DCPD is an insurance acronym that stands for Direct Compensation for Property Damage. DCPD was introduced in Alberta on January 1, 2022, as a part of the Alberta governments auto insurance reform measures. DCPD is used in several Canadian provinces including, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland. The results of DCPD have been faster claims response, consistent treatment during claims, and drastically lower litigation costs.
What is DCPD?
At it’s most basic form, DCPD makes it so that you will always go through your own insurance company in accident, regardless of who is at fault. This does not mean that no one is at fault in an accident, it only means that you will not need to be in touch with the other party’s insurance provider when making a claim.
Before DCPD
If you were in a car accident, both parties would exchange insurance and contact information and you would be responsible for getting in touch with their insurance companies claims department. The responsible party’s insurance company would then pay for the claim. This process often slowed down claims being paid and wound up with high litigation fees.
After DCPD
If you are in a car accident, you would still exchange information. You should get the other persons name, policy number, and insurance company. Once you have their information, you will then contact your insurance companies claims department.
Your insurance provider will assess the collision report from the police department or an Edmonton Collision Reporting Centre. From there, your insurance company will ensure that all parties agree on what the facts of the accident were. Each driver’s insurance policy would then pay the claim (in relation to their coverage).
With DCPD, you will only work with your insurance company, you won’t need to work with the other persons insurance company.
How Does DCPD Pay for At Fault Claims?
If you’re in a car accident where you are found to be 100% at fault and you have collision coverage, your insurance company will pay for the damages to your vehicle. This will increase your auto insurance premiums unless you have an accident forgiveness endorsement. You will pay your deductible on your auto insurance policy.
How Does DCPD Pay for Non-Fault Claims?
If you’re in an accident where you are found to be 0% at fault for the damages, your insurance company will pay for the damages to your vehicle. Your auto insurance premiums will not increase as a result of the pay out. Additionally, you will not pay your auto insurance deductible for the claim.
How Does DCPD Pay for Partial Fault Claims?
In claims where both party’s are found to be partially at fault (and you both have collision coverage), your insurance company will still pay for the damages to your respective vehicles. If you are found to be 25% at fault or greater, your insurance premiums will increase on your policy and you will increase your grid rate by 5. The percentage of fault that you had in the accident is the percent of your insurance deductible that you will pay. If you were each 50% at fault with a $1,000 deductible, you will both pay $500 of your respective deductibles.
If you do not have collision coverage and are in partial fault accident, your insurance company will pay out the damages to the percentage of fault you were not responsible for. If you were 25% responsible for an accident that caused $10,000 in damages to your vehicle, your insurance provider would pay for $7,500 worth of the damages.
Is the Alberta DCPD System Considered No-Fault?
No. There is most certainly fault in the Alberta DCPD system.
The misconception of it being a no-fault system is brought on by the fact that you’ll be going through your own insurance company, rather than going through another parties insurance.
Has DCPD Increased Insurance Premiums?
Yes and no. Depending on the kind of vehicle you have; you may have seen changes in your insurance premium. For individuals with less expensive vehicles with lower repair costs, you may have seen a small drop in your auto insurance premiums. This has not been the case for the owner of high value vehicles or vehicles with high repair costs. The introduction of DCPD has made it more expensive for these drivers as they are responsible for paying the damages, regardless of their client’s fault.
This can be showcased when insuring vehicles with high repair costs. Tesla vehicles are a prime example as they have some of the highest repair costs for their vehicles, in line with Porsche. For the owners of expensive or high-end vehicles, you will have likely seen an increase in your auto insurance premiums.
Conclusion
All in all, Direct Compensation for Property Damage is designed to simplify the claims process for drivers involved in accidents, making it faster and more efficient. By dealing with your own insurance company, you can streamline the claims process and improve outcomes overall. With the complicated nature of DCPD, at-fault claims, collision benefits, extra insurance endorsements, and grid rating, navigating the insurance market can get complicated quickly. By using an insurance broker like Armour Insurance, you get expert advice on your policies and an advocate through the claims process.
Call today to start getting Real Protection from the Real People of Armour Insurance.
