Alberta’s Care-First No-Fault Insurance System: What Changes in 2027?

Published: January 8, 2025 | Last Reviewed: October 16, 2026

What Changes In 2027?

Alberta is preparing to change how people injured in motor vehicle accidents receive treatment and compensation. The Automobile Insurance Act received royal assent on May 15, 2025, and the province’s Care-First system is scheduled to begin on January 1, 2027. [1]

Care-First will expand accident benefits while substantially restricting the right to sue for injuries caused by another driver. For injured Albertans, the practical questions are what benefits will be available, whether those benefits will meet their needs, and what they can do if an insurer denies or limits their claim.

The date of the accident matters. Collisions before January 1, 2027 will remain subject to the existing system, even if the claim continues after Care-First begins. [5]

Key Takeaways

• Earlier accidents remain under the existing rules. Care-First does not replace the rights and benefits applicable to a collision that occurred before January 1, 2027.
• Accident benefits will expand. Eligible claimants will have access to broader treatment, income and other supports, subject to the statutory rules.
• Most ordinary injury lawsuits will be barred. Limited exceptions remain, and disputes over benefits can still arise.
• Higher benefit limits do not guarantee full compensation. Entitlement depends on the injury, the applicable rules and the evidence supporting the claim.

How Alberta’s Current System Works

Alberta currently combines fault-based injury claims with no-fault accident benefits. A person injured through someone else’s negligence may pursue a claim against the responsible party. Depending on the evidence, compensation may include pain and suffering, past income loss, reduced future earning capacity, loss of housekeeping capacity, future care costs and other reasonable expenses.

Separately, eligible injured people can claim Section B accident benefits under an applicable automobile policy, regardless of fault. These benefits include medical and rehabilitation expenses, limited disability payments and certain death-related benefits. They are available without first obtaining a court judgment. [2, 4]

A tort claim allows the injured person to present evidence about how the accident has affected their particular work, health and daily life. However, recovery is not automatic. Fault, causation, the evidence of loss, applicable deductions and legal limits all affect the result.

Pain-and-suffering damages are not unlimited. Alberta’s Minor Injury Regulation caps non-pecuniary damages for injuries that meet its definition. Other personal injury awards remain subject to the Supreme Court of Canada’s general upper limit for non-pecuniary damages, adjusted for inflation. The minor-injury cap does not cap every category of compensation or prevent an injured person from bringing a claim. [2, 3]

What No-Fault Insurance Means

In this context, no-fault insurance means eligible injured people receive prescribed accident benefits without having to prove another person caused the collision. Care-First also limits the ability to pursue a separate lawsuit for additional compensation.

It does not mean fault becomes irrelevant. Responsibility can still affect insurance premiums and legal consequences. Nor does it mean every damaged vehicle is automatically covered: property damage remains subject to separate coverage rules. Alberta already uses direct compensation for certain property damage claims. [2]

Care-First will be delivered by private insurers. Albertans will continue buying automobile insurance in a private market, rather than through a single public insurer. [1]

How Benefits And Compensation Will Change

The comparison below separates existing accident benefits from the additional compensation that may be available through a tort claim. All benefits remain subject to eligibility requirements and applicable limits. [2–5]

Category	Current system	Care-First from January 1, 2027
Medical and rehabilitation	Section B generally provides up to $50,000 for eligible expenses incurred within two years. A tort claim may recover additional proven care costs.	Eligible treatment may continue for life. Coverage depends on the statutory treatment and care requirements; particular services and supports can have limits.
Income loss	Limited Section B disability benefits, plus a potential tort claim for additional income loss and reduced earning capacity.	Generally 90% of calculated net income, subject to a maximum insurable gross income. The published 2025 reference ceiling is $125,000; it is not an annual benefit payment.
Pain and suffering and permanent impairment	Non-pecuniary damages may be recovered through a tort claim, subject to applicable caps.	Ordinary pain-and-suffering claims are generally barred. Eligible permanent impairments attract a scheduled benefit. Published 2025 figures are $298,520 for catastrophic injuries and up to $189,055 for non-catastrophic impairments.
Death and survivor benefits	Section B death-related benefits and, where liability is established, potential fatal-accident claims.	Separate spouse or partner, dependant and other death-related benefits. The published spouse or partner maximum is $600,000; this is not a universal payment or a cap on all family benefits combined.
Right to sue	Generally available where another party is legally responsible, subject to existing restrictions.	Substantially restricted, with exceptions for specified circumstances and certain losses exceeding benefit limits.

About the dollar figures: Alberta’s detailed benefit comparison uses 2025 reference amounts and provides for indexation. The amounts shown are reference figures, not guaranteed payments for accidents in 2027. Entitlement depends on the applicable indexed amounts, benefit rules and any optional coverage. [4]

“Lifetime benefits” also does not mean every requested treatment or expense must be approved. An insurer may dispute whether a particular service meets the legal requirements, making medical evidence and the review process important.

When A Lawsuit May Still Be Possible

The exceptions are broader than criminal convictions alone. Sections 80 and 81 of the Automobile Insurance Act distinguish claims for non-pecuniary damages from claims for specified financial losses. [5]

• Specified offences and administrative penalties. A pain-and-suffering claim may be available against a person who caused the accident and meets a prescribed offence or administrative-penalty condition. A charge or allegation alone is not enough. [5, 6]
• Specified third parties. Claims may remain available against parties such as vehicle manufacturers, repair businesses, certain alcohol providers and municipalities responsible for the road, where the legal requirements for liability are met. [5]
• Certain financial losses above benefit limits. The legislation preserves limited claims for specified excess losses. This does not restore a general right to recover every shortfall. [5]

Optional coverage choices also matter. Declining an offered excess-compensation option can bar an otherwise available claim for losses relating to that option. In addition, the regulations exclude insurer defence and indemnity for the specified offence or penalty claims and prohibit recovery of those judgments against the claimant’s own insurer. A right to sue does not necessarily mean an insured source of payment is available. [6]

What Happens If An Insurer Denies Benefits?

Care-First does not eliminate disagreements about medical treatment, disability, income calculations or permanent impairment. The legislation provides for insurer review and appeals to the Alberta Automobile Care-First Tribunal. [5]

An injured person should obtain the insurer’s decision and reasons in writing, preserve supporting medical and financial records, and act promptly on any review or appeal deadline. Legal advice may help identify an incorrect benefit calculation, an unsupported denial or an available lawsuit exception.

Where The New System May Leave Gaps

The expanded accident benefits are significant. The concern for injured people is whether prescribed benefits adequately reflect the consequences of a particular injury. A standardized assessment can produce a different result from a tort claim supported by evidence about the person’s life and likely future.

The system contains specific provisions for students and minors, caregivers and older workers. Benefits do not invariably end at age 65: the Act includes retirement income benefits and rules addressing employment at older ages. These provisions must be considered when assessing an individual’s entitlement. [5]

The more useful questions are whether the rules adequately recognize a young person’s likely career, the cost of replacing care for a dependent family member, or the financial impact on someone who expected to keep working. These are potential areas of undercompensation, rather than outcomes that can be assumed in every claim.

Similarly, a permanent impairment payment is not an individualized award for pain, suffering and loss of enjoyment of life. Someone whose injuries substantially disrupt their life may have no ordinary tort claim and may not qualify for a permanent impairment payment.

At Preszler Injury Lawyers, our concern is that injured people understand both the benefits available to them and the compensation they may no longer be able to recover.

Will Premiums Fall Under Care First?

AIRB’s September 8, 2026 report says approved insurer filings show an average premium reduction of 13.7%, or about $297 per private passenger vehicle. These are average results, not promised savings for each driver. Some vehicle classes are expected to see increases. [7]

The new rate protections also have qualifications. Beginning in 2027, the announced limits are 5% for an insurer’s average annual rate increase and 10% at renewal for increases arising from insurer rate or rating-program changes. Changes in personal risk or coverage, such as an at-fault accident, a new conviction, a different vehicle or an added driver, can produce an increase above 10%. [8]

Whether a lower premium represents good value also depends on the coverage purchased and the protection available after a serious injury.

Accidents Before January 1, 2027

An accident before January 1, 2027 remains governed by the existing system. Starting a lawsuit or hiring a lawyer after that date does not, by itself, move an earlier accident into Care-First. The transition provisions preserve the earlier insurance rules. [5]

That does not create an unrestricted or indefinite right to sue. Existing limitation periods, liability requirements and other restrictions still apply. If you were injured in 2026 or earlier, do not delay seeking advice because you assume the new system has removed your rights.

Speak With Our Calgary Car Accident Lawyers

Care-First changes both the benefits available after a collision and the legal options for pursuing compensation. Understanding which system applies is the first step.

If you or a loved one has been injured in a motor vehicle accident, contact Preszler Injury Lawyers for a free consultation at 1-888-494-7191. We can help you understand the rights and benefits that may apply to your claim.

Learn more about our Calgary car accident lawyers

Sources

1. Government of Alberta, Enabling better auto insurance and Care-First auto insurance. Royal assent, planned commencement and private delivery. Enabling better auto insurance | Care-First auto insurance
2. Government of Alberta, Automobile insurance reform. Current benefits, non-pecuniary limits and property-damage framework. Automobile insurance reform
3. Andrews v. Grand & Toy Alberta Ltd., [1978] 2 SCR 229; Whiten v. Pilot Insurance Co., 2002 SCC 18. General non-pecuniary ceiling and inflation adjustment. Andrews | Whiten
4. Government of Alberta, Care-First Auto Insurance — A Comparison of Accident Benefits, pp. 1–2. Amounts are labelled as 2025 reference figures. Benefit comparison
5. Automobile Insurance Act, SA 2025, c A-47, particularly ss. 4, 18–35, 71–74, 80–89 and 103, read with the 2026 amendments. Legislative texts: Bill 47 and Bill 27, s. 3 (including replacement ss. 80–82 and the transition amendment). Bill 47 | Bill 27 | 2026 amendment enactment status
6. Exclusions and Tort Bar Exceptions Regulation, Alta Reg 205/2026, ss. 1 and 14–18. Regulation text reproduced by LexIntellect. Regulation text
7. Automobile Insurance Rate Board, Care-First Consumer Premium Impact reports, September 8, 2026. AIRB premium findings
8. Automobile Insurance Rate Board, Understanding Alberta’s auto insurance rate caps, updated June 5, 2026. Rate caps and exceptions

We’re here to help.