New York Personal Injury News & NYC Legal Current Events

NY Bill Meant to Tackle Vehicle Accident Insurance Fraud

Posted on Jun 02, 2011

A bill is being considered to stop auto accident insurance fraud that would help combat the high rates of insurance in the state. New York state insurance is shown to cost 53% more than the insurance rates on a national average. It is said that the high rates in NY are due to the variety of insurance loopholes which allow for criminals and organized crime organizations to make serious cash from insurance fraud rings.

The bill proposes penalties on criminals that attempt to defraud the system. The criminals have been setting up fraudulent accidents and then solicit medical providers to commit additional insurance fraud. An insurance company would be allowed to deny claims despite passing a 30-day deadline for review though it would still be required to pay interest penalties and attorney costs deemed reasonable if a claim goes overdue.

Currently the insurance companies are estimated to have paid upwards of a half a billion dollars in fraudulent insurance claims in the last two years. However, the NY State Trial Lawyers Association is opposed to the bill, citing that the no-fault fraud issues are simply a cover for the insurance company to deny claims that are legitimate.

Those in opposition of the bill also believe that alleging big savings to drivers who pay insurances isn't exactly accurate. They say that the no-fault provision is actually only a small percentage of an insurance policy and insurance holders won't be saving all that much.

What people do agree on is that insurance rates for New York drivers are very high due to the insurance companies losing money within the state. The bill was presented to the Peekskill office of the NY Department of Motor Vehicles.

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Lever & Stolzenberg, LLP is located in White Plains, New York and serves clients throughout the state, including New York City's five boroughs (The Bronx, Brooklyn, Queens, Manhattan and Staten Island) as well as Westchester County, Rockland County and Long Island. 

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