According to the National Association of Independent Insurers (NAII), rather than address the rampant no-fault fraud that costs New York consumers over a billion dollars each year, the legislature yesterday allowed several key provisions of insurance law to sunset.
Joseph Termini, NAII counsel, stated that the Assembly had gone beyond failing to propose meaningful fraud reform, to undermining the stability of New York’s auto insurance market. Termini added that the legislature had done nothing to address the cost problem presented by fraud in the no-fault system, in particular and that AB 8654-D, passed by the Assembly, fails to take the cost of fraud out of the system.
Among the provisions that were allowed to expire were private passenger and commercial lines flex-rating laws and provisions establishing guidelines for the renewal of automobile insurance.
Termini stated that the re-enactment of the flex-rating laws and pertinent automobile policy renewal provisions are critical to the health of New York’s insurance market.
The legislature should enact measures to combat the serious matter of insurance fraud and over-utilization of medical treatment, Termini added. Solutions such as enactment of treatment guidelines relating to treatment for “soft tissue” neck and back injuries could combat the skyrocketing cost of fraud, rather than elimination of laws that encourage insurers to compete with each other to offer consumers better price and service.
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