The findings were presented in a letter addressed to Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie. The research outlines key factors behind rising premiums and offers data-driven recommendations to improve affordability for consumers across the state.
According to the study, systemic fraud, staged accidents, exaggerated claims, and complex litigation processes are among the primary drivers of higher insurance costs. These factors, researchers say, effectively act as a “hidden fraud tax,” adding roughly $200 per policy for drivers and businesses.
The report notes that New York drivers currently pay some of the highest insurance rates in the country. Full coverage averages around $4,000 annually, compared to roughly $2,600 nationwide, while minimum coverage costs are also significantly higher than the national average.
Transportation experts emphasize that targeted policy reforms could help ease these financial pressures. Proposed measures include strengthening fraud detection and enforcement, improving data sharing between insurers and regulators, enhancing oversight of claims and billing practices, and adopting modern underwriting tools such as telematics and usage-based insurance.
The analysis also highlights the potential benefits of reinforcing the state’s excess profit laws to ensure that savings are passed on to consumers. It points to Florida as an example, where recent reforms have led to projected premium reductions and substantial refunds to policyholders.
In addition, the study identifies no-fault billing abuse, medically unnecessary treatments, and staged collisions as significant contributors to rising loss costs. Addressing these issues through targeted enforcement could lead to meaningful reductions in premiums.
The letter concludes by urging lawmakers to prioritize data-driven reforms aimed at reducing fraud, improving accountability, and modernizing insurance practices. Such steps, the researchers argue, could help create a more stable and affordable auto insurance market for New Yorkers while delivering direct financial relief to consumers.
