Alberta introduces Insurance Act amendments, changes limitation periods

The Alberta government on June 12 introduced Bill 42, which contains a number of changes to the province’s Insurance Act, including an extension of the limitation period for a policyholder to claim against an insurer from one to two years.

The bill proposes to establish a regulation-making authority that would require disclosure of a limitation period at a certain interval after the claim was made.

Other substantive amendments include the requirement of regulatory approval for exclusions for damage caused by fire, and the proposal that a new regulation-making authority be established to clarify the sale, compensation disclosure and administration of all types of group policies. The regulation making authority is to apply to Life and Accident & Sickness groups policies, excluding P&C group policies.

Bill 42, which would fully repeal and replace Part 5 of the Insurance Act (dealing with insurance contracts), is now in first reading. The changes are intended to modernize the legislative framework for insurance contracts and strengthen consumer protection.

Bill 42 amendments would change the fire following part of the Insurance Act so that the legislation is applicable to general insurance.

Also, to strengthen consumer protection, current statutory conditions that provide a substantive right or impose a key obligation on a policyholder or insurer will be retained and made applicable to all general insurance contracts. Many of these conditions previously applied only to fire or automobile policies.

A complete guide to the changes and a copy of Bill 42 can be found at: http://www.assembly.ab.ca