Changes in New York’s no-fault auto insurance regulation will help prevent fraud and lower costs, according to an amicus brief the National Association of Independent Insurers and the American Insurance Association plan to file in the Appellate Division of New York State Supreme Court.
The Brief seeks to support the state Department of Insurance’s appeal of a lower court ruling in June that overturned the new regulation. Also joining in the brief are State Farm Insurance, Nationwide Mutual Insurance and the New York Insurance Association.
The regulatory change requires earlier notice of claims and health care billing in auto insurance cases aimed at reducing the number of fraudulent claims.
The changes were challenged in court by trial lawyers and health care providers. In February, the insurance department promulgated a new regulation requiring claimants to notify insurers of an accident and submit proofs of loss, including medical bills, within 30 and 45 days, respectively, instead of the current 90 and 180-day deadlines.
“With these amendments, the New York Insurance Department took reasonable steps to deal with fraudulent claims and to contain lawsuit-generated medical costs,” said David Snyder, AIA assistant general counsel. “Under the current regulation, unscrupulous people are defrauding the system with staged accidents and padding of claims. The current time allows these unscrupulous individuals the chance to run up huge claim costs before an insurer is even notified that a claim exists.”
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