By John Ravitz
Fraud and excessive litigation are driving up insurance premiums for everyone. That’s why Gov. Kathy Hochul’s proposals to crack down on fraud and modernize New York’s outdated liability standards deserve serious support from lawmakers in Albany.
Groceries cost more. Energy bills are soaring. Housing remains expensive. And for millions of working families and employers, auto insurance has become a major cost driver fueling the affordability crisis.
For local shops and restaurants, trucking companies, contractors, and municipalities, this growing financial burden translates directly into higher operating expenses, tighter budgets, and fewer resources for growth, hiring, and public services. Those costs ultimately show up as higher prices for consumers and reduced returns for taxpayers.
In 2023 alone, New York recorded more than 1,700 staged collisions and tens of thousands of incidents of suspected fraud. Organized networks — involving unethical lawyers, medical mills, “runners,” and outside financiers — exploit the no-fault insurance system by staging crashes and inflating injuries. While the profits flow to bad actors, the bill gets passed to responsible drivers, small businesses, and local governments.
New York’s no-fault auto insurance system was intended to reduce lawsuits and make compensation more efficient. Instead, it has become a magnet for abuse. The result is a system that rewards misconduct, incentivizes unnecessary lawsuits, and pushes premiums higher for families and local business owners who are already struggling to keep up.
Other states that have taken meaningful steps to rein in litigation abuse and insurance fraud are seeing tangible results. After recent reforms in Florida, insurers filed for premium reductions of up to 20 percent. That translates to real relief for a vast majority of drivers.
Gov. Hochul’s reform package would bring New York’s liability standards more in line with those used in 33 other states — and it would do so without weakening protections for people who are genuinely injured. The proposals preserve coverage for medical bills and lost wages while strengthening safeguards against fraud and profiteering. They would restore balance to a lopsided system — protecting access to the courts for legitimate claims while removing incentives for criminal activity and dubious litigation.
These are common sense measures. Responsible drivers should not be subsidizing a system that rewards reckless or unlawful behavior. More reasonable liability standards and new penalties for staged accidents will promote safer roads and help rein in the fraud and opportunism driving up costs.
For the business community in Westchester, high insurance costs affect hiring decisions, fleet expansion, delivery options, and the ability of Main Street businesses to compete. For local governments, the ballooning price of coverage means fewer dollars for public services and infrastructure. For families, it means one more bill that keeps increasing.
The Legislature has an opportunity to back Gov. Hochul’s thoughtful reforms that will put money back in the pockets of New York families and help stabilize costs for employers and municipalities. The Business Council of Westchester looks forward to working with our legislative leaders to put an end to fraud and lawsuit abuse — and fix a liability system that no longer serves the best interests of honest, hardworking New Yorkers.
John Ravitz is Executive Vice President and Chief Operating Officer at the Business Council of Westchester.
