AAI Says Appeal of Reg 68 Ruling Costs NY Drivers $2 Million a Day

February 28, 2002

The Alliance of American Insurers (AAI) has strongly attacked the decision of groups led by trial lawyers to appeal trial Judge William Wetzel’s decision to give the New York State Insurance Department the go-ahead to implement new regulations contained in Regulation 68, which would significantly shorten the time for filing reports of auto accidents and medical claims in an effort to curtail no-fault fraud. (See IJ Website Feb. 21).

The Appellate Division, who will eventually rule on the matter issued a stay in implementing reg 68, which the AAI charges will allow perpetrators of fraudulent practices, notably phony medical claims mills and unscrupulous attorneys, to continue operating. “No fault insurance fraud is a thriving business in new York, costing all drivers statewide an extra $125 annually on their car insurance bills,” sated John Cucci VP of the AAI Northeast region.

Cucci also estimated that this amounts to $2 million a day. The AAI cited a recent study by the Insurance research Council which determined that 65 percent of medical bills submitted more than 45 days after the first treatment contain elements of fraud, mainly in the form of unnecessary or non existent treatments.

The Appellate Court is expected to examine the claims, and to issue a ruling in mid- march as to whether the stay on the implementation of Reg 68 should remain in place while the appeal is considered, or whether they can be applied pending the final outcome of the litigation.

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