Find Cheap Auto Insurance
in Calgary

Car insurance in Calgary

Car insurance is mandatory throughout Canada, and Calgary is no exception. In fact, you're not even allowed to buy license plates without proof of insurance. Insurance covers the cost of damage and injuries sustained in an accident.

How does car insurance work in Calgary?

Alberta has a private auto insurance system. In basic terms, it means drivers buy their coverage from insurance companies. In some places in Canada, drivers get insurance from a Crown corporation, which is also usually the sole provider of car insurance in the province.

Alberta's auto insurance system has two other defining characteristics:

• Your own insurance company will pay to repair or replace your car if you're not at fault for an accident,
• And it will pay for your medical care, regardless of fault.

The intention behind this recently enacted change is to create a more efficient process to resolve auto insurance claims. These efficiencies will benefit consumers' wallets, too. Lower legal expenses mean insurance companies can charge Albertans less for coverage.

The Automobile Insurance Rate Board (AIRB) is a provincial body that establishes guidelines on how insurance companies can rate consumers. Insurance ratings determine how much the company charges a driver for coverage.

AIRB has another tool to regulate insurance prices: the Grid. The Grid outlines the most a company can charge for basic insurance coverage. You may move up or down the Grid depending on your driving history. The rules state that your insurance premium cannot exceed the maximum price for someone with your driving history.

How car insurance rates are set in Calgary

These are the steps Alberta insurance companies follow to calculate your rate:

#1 - Insurance companies figure out the base premium to charge all customers.

The base premium is the average amount needed from each customer to ensure the company can pay claims and bills and extract a reasonable profit.

#2 - They use rating factors to determine the amount of risk you present as a driver.

Doing this changes the base premium. Your insurance company will rate you based on:

• The number of years you've held a license,
• The number of traffic convictions you've had,
• The number of accidents you've had,
• Whether you've had driver training from an accredited school,
• And finally, where you live.

If you live in a city, your premium will likely be higher than someone living in the country. There are more vehicles on the road, which means more accidents. Theft, vandalism, and insurance fraud tends to happen more frequently in cities.

#3 - They assess your car.

The make and model year affects a part of your premium. Why? Insurance companies have to consider how much it could cost to repair or replace your car. For more recent models, premiums tend to be higher than cars older than three years. The older the vehicle, the more you stand to save on insurance. Cars with better safety and handling characteristics are sometimes more affordable to insure. However, many vehicles with superior safety features have built-in sensors to detect danger, making them costly to fix. This means, paradoxically, that you might not reap savings on your insurance by picking the safest car on the market.

Factors in Calgary that affect your car insurance premium

The most common causes of a price increase can be split into two categories: the factors you can control and those you can't.

Factors you can control:

• You cause an accident. Your premium will go up at renewal. You may even have to file a claim to have your car's computer system fixed. Because you were at fault, this, too, will cause your premium to increase.
• You move neighbourhoods. Your postal code affects your car insurance rate. Some areas are riskier than others.
• You change your car. The type of vehicle (its year, make, and model) will influence the premium. If you finance your vehicle, you'll likely need to add collision and comprehensive to your policy.

Factors you can't control:

• An increasing number of serious claims. According to the Automobile Insurance Rate Board, the average claim has more than doubled since 2005.
• Distracted driving is now outpacing impaired driving. It's now the leading cause of accidents and death in the province.
• Newer cars cost more to repair. Even affordable brands are outfitting cars with complex computer systems.
• Severe weather. Drivers are filing more claims due to events like hail, flooding, and wildfires.
• Vehicle theft is on the rise in Alberta. The province accounts for 29% of all vehicle thefts in Canada.
• The increasing cost of medical care. An aging population and inflation are major drivers.

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How to get the cheapest car insurance quotes in Calgary

#1 - Compare rates

This tactic is recommended by the Insurance Bureau of Canada, the Alberta Insurance Regulation Board, and the Financial Consumer Agency of Canada. Getting quotes from different insurance companies is the best way to find your lowest rate.

#2 - Compare insurance prices before buying a car 

A car's make and model will impact insurance costs. Before you buy, make sure to research which cars are the cheapest to insure in Canada.

#3 - Try usage-based insurance 

Usage-based insurance refers to telematics and pay-as-you-go insurance. Both are now available in Alberta.

With a telematics program, you agree to install a device that records your driving habits. You get a discount at renewal, but only if the device shows you to be a responsible driver. The device will record:

• The time of day you drive,
• Where you drive,
• The number of kilometres logged,
• Your speed,
• How fast you accelerate,
• How hard you brake,
• And how often you use your phone while driving.

Pay-as-you-go insurance also uses a device to record your driving patterns. You buy coverage for a set amount of kilometres (usually no more than 12,000 km a year). The device bills you for every 1,000 kilometres you go over.

#4 - Drop collision and comprehensive coverage on older cars 

If you finance or lease a vehicle, collision and comprehensive are likely mandatory. If you own your car outright, you may want to consider dropping these covers. It could be cheaper to pay for repairs yourself, especially if you drive an older car.

The following rules of thumb can help you decide whether to keep collision and comprehensive.

• Drop these covers if your car's value is approximately twice your insurance deductible.
• If the cost of collision and comprehensive coverage is more than 10% of your car's current value, drop them.

But before you cancel these add-ons, make sure you can handle the cost of repairing or replacing your car.

#5 - Increase your deductible

Your insurance company will generally make you share the cost of a claim with them. For example, your deductible on a $10,000 claim may be $1,000. If you offered to pay $2,000, your insurance company would lower your premium in return.

Make sure you're able to pay a higher deductible. Depending on your finances, paying a higher monthly premium may be worthwhile.

#6 - Be an all-star (driver, that is)

Insurance companies use a star rating to rank drivers. Your star rating is based on the number of years you’ve been licensed and claims-free. The more stars you have, the better. Some insurance companies award drivers up to six stars, others go all the way up to 20 — it’s different for each insurer.

#7 - Apply for as many discounts as you can

Bundling your insurance is the one most impactful ways to lower your premium. Bundling refers to buying car and home insurance from the same company. Lower premiums aren't the only benefit of bundling. If you need to claim your car and home at the same time, you'll only pay one deductible.

Here are some other discounts available to Alberta drivers:

• Driving school certificate insurance discounts,
• Increased deductible insurance discount,
• Telematics insurance discount,
• Discount for renewing with your insurance company,
• Seniors' car insurance discount,
• Multi-vehicle insurance discount,
• Discount for renewing your policy with your current insurance company,
• And discounts for installing an anti-theft device.

Wondering how these discounts stack? Insurance companies take the discounts you qualify for and arrange them from largest to smallest, applying each one to your rate in succession.

#8 - Consult an insurance professional 

An insurance professional will identify coverage gaps and create an insurance plan. They can also suggest discounts not listed here.