The Difference Between No-Fault and At-Fault Insurance

Difference Between No-Fault and At-Fault Insurance
No-Fault insurance means that your insurance company will payout your property damage claim and any personal injury claim that you may have. It does not matter who is at fault for the accident, it is your insurance company that is responsible for paying out all your losses. Provinces with No-Fault insurance limit or prohibit compensation for pain and suffering if you are injured.

Alberta has an At-Fault insurance system which means if you suffer any loss in an automobile accident, the at fault party’s insurance company pays for all your losses. At fault Provinces, like Alberta allow injured parties to be compensated for their pain and suffering.

The Advantages of Having an At-Fault System for Injury Claims

  • Your insurance company does not interfere with your rights
  • You have access to the Courts if necessary
  • Compensation for pain and suffering is recoverable
  • The at fault party is held accountable for their actions

The Disadvantages of Having a No-Fault System for Injury Claims

  • Compensation for Pain and suffering is limited or not available
  • Your access to the Courts is restricted or limited
  • Provincial Legislation regulates your rights and determines your compensation
  • Your rights to appeal any decision may be restricted
  • The at fault party is not held accountable for their actions

Alberta Automobile Insurance Reform

An Alberta advisory committee was appointed to look at the Government’s options on automobile insurance reform. The committee provided their Report and recommendations to the Alberta Government in September 2020.

One of the recommendations in the Report was for the Alberta Government to consider adopting a pure No-Fault care and compensation model for those injured in automobile accidents. The committee also recommended that an administrative body be formed to administer all injury claims.

At this time, the Alberta Government is consulting with the public before they make any final decision on whether to adopt a no-fault insurance system.

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