2026 Annual Review Report

By Automobile Insurance Rate Board · 2026

The Alberta Automobile Insurance Rate Board's report concluding its 2026 annual review of industry loss experience as of December 31, 2025. The review sets the industry benchmarks — loss development, loss cost trends, administrative expense and ULAE, health cost recovery and profit — that the AIRB considers when it evaluates rate filings received on or after October 1, 2026, for private passenger vehicles, commercial vehicles and motorcycles. It draws on the final report of the AIRB's consulting actuary, Risk Consulting Services (RCS), and on written submissions from the Insurance Bureau of Canada and the Alberta Civil Trial Lawyers Association.

Executive Summary

Annual Review Process
- RCS's preliminary report on industry loss experience was published on June 18, 2026, and interested parties were invited to make written submissions.
Key Sources of Uncertainty
- COVID-19 driving patterns (2020 to the first half of 2022); Bill 41 (expanded accident benefit limits, a changed minor injury definition, and direct compensation for property damage from January 1, 2022); and the late-2021 rise in CPI categories affecting physical damage claim costs.
Other Factors Affecting Loss Cost Trends
- Insured private passenger vehicles grew from about 1.37 million (first half of 2016) to 1.57 million (second half of 2025); comprehensive take-up decreased over ten years; deductibles shifted consistently higher.
- Insurers are expected to rely on their own data; the benchmarks are for an insurer without sufficient data or support.

Annual Review

Industry Experience Review
- RCS's Review of Industry Experience as of December 31, 2025, Private Passenger Vehicles, uses General Insurance Statistical Agency (GISA) claim data for all insured Alberta vehicles, including the Facility Association and Risk Sharing Pools.
Stakeholder Consultation
- Written submissions were due August 4, 2026; the Insurance Bureau of Canada and the Alberta Civil Trial Lawyers Association made them.

Summary of Findings

Claim frequency has generally stabilized below pre-pandemic levels while claim severities remain elevated.
Selected PPV loss cost trend benchmarks: +8.6% bodily injury, +9.0% accident benefits, +1.4% property damage, +1.4% DCPD, +2.3% collision, +3.6% comprehensive and +2.8% all perils (as the summary states them).
The AIRB maintained the Health Cost Recovery assessment, the operating expense benchmark and the allowed profit provision.

Industry Benchmarks

All full filings must consider benchmarks for five components: 1 Loss Development Factors, 2 Loss Cost Trends, 3 Administrative Expense & Unallocated Loss Adjustment Expense (ULAE), 4 Health Cost Recovery and 5 Profit; the AIRB-approved benchmarks are expected where industry loss costs serve as a credibility complement.
Loss Development Factors
- The AIRB accepts RCS's selected claim count and amount development factors as benchmarks; insurers use their own data where credible.
Loss Trends
- The benchmarks apply to rate indication filings submitted between October 1, 2026 and March 31, 2027, during which insurers may only file to increase physical damage premiums.
- Tables compare trend selections by coverage across the 2025 and 2026 semiannual and annual reviews for PPV, and the 2025–2026 commercial and 2026 motorcycle annual reviews; the motorcycle review is new in 2026.
Operating Expenses & ULAE
- The 2022 IFRS 4 expense ratio continues to be used until an acceptable IFRS 17 metric is defined: AIRB selections of 20.0% (amortization of insurance acquisition cash flows), 7.8% (general and operating) and 27.8% total expenses, with a ULAE factor of 1.094 from the GISA exhibit.
Health Cost Recovery
- A levy on third-party liability premiums that recoups public healthcare costs of auto collisions; insurers use the most current percentage published by the President of Treasury Board and Minister of Finance.
Profit
- The pre-tax profit benchmark, lowered from 7.0% to 6.0% of premium effective October 1, 2023, is maintained at 6.0% in 2026.

Care-First

Care-First takes effect January 1, 2027; bodily injury and accident benefits premiums are frozen for the 2027 calendar year.
Insurers filed Care-First rating programs using the benchmarks of the Care-First Actuarial Costing Report and the requirements of AIRB Bulletin 04-2026, with mandated benchmark premiums for bodily injury, accident benefits and SEF 44.

Appendices

A. RCS Review of Industry Experience Final, PPV
B. Industry Benchmark Schedule
C. Consumer Perspectives Report

Sources

2026 Annual Review Report (Automobile Insurance Rate Board, 2026) — the document: its contents, bookmark outline, text and the trend and expense tables (pages 6–7 read as images), read 2026-10-30 (sha256 828ffabe7c8085a6…). Its Summary of Findings gives comprehensive +3.6%, while the PPV trend table's 2026 Annual Review column prints +5.4% (and +3.6% under the 2026 Semiannual Review)
AIRB Annual and Semi-Annual Reviews page — the publisher's listing: the review's issue date (June 18, 2026), the appendices and the stakeholder submissions