Car insurance in Edmonton Alberta can be purchased through a direct writer Insurance company or an Agent or Insurance Broker.
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A direct writer insurance company is an insurance company that is licensed to sell car insurance directly to the consumer public. Some examples of direct writer insurance companies are Belair, TD Insurance, RBC Insurance, Desjardins Insurance and many more.
Direct writer auto insurance companies in Edmonton employ insurance agents to sell and service customers or policyholders. Direct writers eliminate the “middleman” in the insurance transaction process as a business model that tends to usually be cheaper for the consumer, as commissions are not paid to an Insurance broker or other intermediaries.
Car insurance in Edmonton is governed by the Automobile Insurance Rate Board or AIRB. The AIRB is responsible for ensuring car insurance prices and rates in Edmonton, or anywhere else in Alberta, is fair and reasonable. “The Board’s vision is to foster an efficient and effective automobile insurance market with fair and predictable rates.”
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Grid Automobile Rating in Edmonton
The grid rating program was designed by the government of Alberta to keep car insurance in Edmonton reasonable and fair. The risks that fall under the grid rating plan are often considered “high risk” or substandard. Because of this, an insurance pool was set up with the residual insurance company called the Facility Association so that auto insurance can be accessible to all Albertans regardless of driving record.
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The grid outlined the maximum car insurance premium that an insurance company can charge for basic coverage, regardless of driving record.
Insurance companies then compare car insurance premium generated by the Grid system to their rating program and choose the lesser of the two quotes. You can argue the grid system is a consumer protection measure for Edmontonians, although most insured drivers in Edmonton fall below Grid premiums.
Car Insurance in Edmonton FAQs
How are car insurance rates in Edmonton calculated?
Car insurance rating in Edmonton is calculated, similarly to other car insurance rating systems models used by insurance companies in other provinces.
Auto insurance premiums in Edmonton are calculated using the following:
– The vehicle itself – based on insurance bureau statistics that measure the likelihood of an injury or extent of damages of a vehicle based on make and model of car.
– Postal Code – where you garage the vehicle, usually where you live in a personal auto insurance policy
– Driver Habits and Behaviour – this is pretty self-explanatory; if you have a driving history full of driving violations and traffic tickets, and accidents, you’re likely to pay more than someone who has a cleaner driving record.
– Driving Experience – Years licensed and insured also play a factor in determining your car insurance premium in Edmonton.
Car insurance rates in Edmonton are based on a two-model system. One system of car insurance rating is a traditional system comparable to other provinces. The other system is called the grid system.
How can I lower my car insurance in Edmonton?
Lowering the cost of car insurance in Edmonton can be achieved by the following:
– Thoroughly shop around – shopping from different distribution channels such as an Insurance Brokerage, Agency or a direct writer insurance company can generate different prices with comparable coverage. Get as many auto insurance quotes from as many sources as possible. The exercise may seem time-consuming and tedious but might help you save money!
– Substitute your vehicle – although your driving record and prior claims history make of the bulk of your auto insurance cost, there’s an opportunity to save money by switching to a different vehicle. Auto insurance companies in Edmonton use the CLEAR model for rating the vehicle in itself. CLEAR stands for Canadian Loss Experience Automobile Report and provides statistical data on the likelihood of injuries, damages or loss associated with a particular make and model of vehicle involved in an accident or loss.
– Increase your deductible – a deductible also called a Self-Insured Retention (SIR), means that you must pay the first portion of a covered loss in a car insurance claim. Increasing your deductible shows the insurance company that you’re willing to pay more out of your pocket for covered losses. Deductible amounts in Edmonton typically can range from $300 to $1,000, with higher deductible amounts not unheard of. The cost savings from increasing your deductible isn’t going to be a drastic reduction in insurance cost, but still, a way to save some money!
– Combine Home and Auto Insurance – insurance companies offer big discounts for combining your home or habitational insurance with your car insurance. Discounts anywhere from 20% to even as large as 40% are common for bundling your insurance under one company! You can even benefit from when adding additional vehicles to your auto policy.
– Reduce Insurance Coverage – it’s probably not a good thing to reduce insurance coverage, but if you must, it might save you some money. Speak to your insurance representative about the repercussions of reducing or eliminate insurance coverage.
What is the average cost of auto insurance in Edmonton?
The average price of auto insurance in Edmonton is roughly $1,250, annually according to thinkinsure.ca. The figure is based on a driver with a clean record with driving experience of over ten years. Depending on your driving experience, claims history and driver’s license violations the average price for car insurance in Edmonton could be substantially more!
What is the average price of auto insurance in Edmonton per month?
The average price of auto insurance in Edmonton per month is approximately $122 based on findings from Insureye.ca.
How do I get car insurance in Edmonton?
Car insurance companies in Edmonton consist of direct writers insurers (Belair, TD Insurance, RBC Insurance, Desjardin, etc.) and also insurance brokers and agents. It’s important to know the key differences between various ways that car insurance in Edmonton is sold and distributed.
– Insurance Broker – An insurance broker is an intermediary who helps find the best and most affordable auto insurance for you. Insurance brokers are also responsible for ensuring that your insurance needs are met, through remarketing for better prices or explaining insurance coverages and auto claims procedure. Insurance brokers have a duty of care to the consumer and to the insurance company they represent. Most insurance brokers and brokerages posit themselves as an independent and separate legal entity from the insurance companies they represent, but that is not always the case.
– Insurance Agent – an Insurance agent sells and service auto insurance, mainly from one company. Insurance agents are usually employed by Direct Writer insurance companies, which means they can sell directly to the consumer public as employees of the insurance company. Essentially there is no “middleman” between the insurer and the insured. An argument can be made that direct-writing insurance companies are cheaper than independent insurance brokerages because a commission is not being paid to the intermediary (broker). However, on the flip side, an Insurance agent usually sells products from the insurance company they work under. A good example of this would be TD insurance.
– Independent Insurance Agent – an independent Insurance agent is very similar to an Insurance agent but works as an independent contractor. From a legal business structure, independent insurance agents are separate from the insurance company they represent. Although an independent insurance agent is a separate legal entity from the insurance company, they typically sell the insurance products of one company. A good example of this would be State Farm Insurance or Desjardin.
– Managing General Agent or Wholesale Broker – a Managing General Agent (MGA), or Wholesale Broker works as an intermediary for both retail insurance brokers, Insurers and sometimes with the insured. An MGA mainly works to find specialized insurance coverage, while having no contact with the insured.
Why is car insurance in Edmonton so expensive?
Car insurance in Edmonton is expensive mainly because of population and traffic density. Edmonton has a population of close to 1.5 million people. If you can imagine a population base where an average family has two vehicles, that’s a lot of vehicles on the road! The more people on the road, the more likely accidents, and injuries happen.
Insurance companies are forced to pay out on a higher claim frequency in Edmonton, compared to cities that have less population and traffic density. This means that the insurance “pool” is being used mainly by drivers of the Edmonton area which insurance companies calculate and make reflective on the cost of car insurance in that area.
How to get cheap car insurance in Edmonton?
The secret to finding cheap car insurance in Edmonton is shopping and comparing prices from as many Insurance companies, insurance brokers and insurance agents as possible. If your goal is to find the cheapest car insurance, and the price is the most important factor to you, then you should be looking for car insurance quotes approximately 30 days before your renewal, if applicable. Prices of auto insurance in Edmonton fluctuate regularly and car insurance quotes are usually valid for one month before lapsing, so it’s important to shop around as much as possible within that time frame to secure the cheapest auto insurance rate.
Peter Martire, CIP, CRM
Chief Technical Officer at Insurancesumo.ca, Chartered Insurance Professional, Canadian Risk Manager
Having worked in the insurance industry in Canada for almost 20 years, Peter’s focus is primarily on the property and casualty insurance sector. Peter has vast experience in the insurance industry, as an Insurance Broker and Claims Adjuster with tenures in companies such as Aviva Canada, Northbridge Insurance, HG Group Insurance Management and High Risk Auto Pros.
Peter Martire obtained his Chartered Insurance Professional designation from the Insurance Institute of Canada in 2005 and was awarded the Canadian Risk Manager accreditation by the Risk Management Society in 2013.