How Are Disputes Handled in a No-Fault System?

When Alberta adopts no-fault auto insurance on January 1, 2027, the way disputes are handled will change dramatically. Instead of suing in court, most disagreements with your insurer will be resolved through administrative processes such as tribunals or arbitration.

How Disputes Work Today (Before 2027)

• Accident victims can sue the at-fault driver in court if their insurer refuses to pay fairly.
• Judges or juries determine what compensation is owed.
• The ability to go to court gives victims leverage in negotiations, often leading to higher settlements.

How Disputes Will Work Under No-Fault (After 2027)

• You will file a dispute directly against your own insurance company, not the at-fault driver.
• Disagreements will typically go through:
  • Tribunal hearings (specialized boards created to handle accident benefit disputes)
  • Arbitration processes, where a neutral arbitrator makes a binding decision
  • Internal insurer reviews in some cases

Courts will no longer be the main forum for accident compensation disputes.

What Types of Disputes May Arise?

Common disagreements under no-fault systems in other provinces include:

• Whether treatment is reasonable and necessary
• How long income replacement benefits should continue
• The severity of the injury (minor vs. catastrophic)
• Disagreements about caps or benefit limits

Pros and Cons of the Tribunal Model

• Pros:
  • May resolve disputes faster than a full lawsuit
  • Lower legal costs compared to court trials
• Cons:
  • Less independent than the court system
  • Compensation is still capped by law — tribunals cannot award beyond statutory limits
  • Victims lose bargaining power because insurers know lawsuits are not an option

Will Lawyers Still Play a Role?

Yes. Even without court actions, lawyers can:

• Prepare evidence and arguments for tribunal or arbitration hearings
• Challenge insurers on medical and income benefit cutoffs
• Hold insurers accountable if they act in bad faith (limited situations may still allow court action)

Key Takeaway:
Under Alberta’s no-fault system, disputes will be handled through tribunals and arbitration, not courts. While this may speed up some cases, it also means accident victims will have fewer rights and less leverage to push for full compensation.