New Yorkers, Fed Up With Insurance Rates, Want Lawsuit Reform

Recent polling shows voters in New York support lawsuit reform that would lower their auto insurance premiums, as discussion heats up about allegedly staged car wrecks that end up in court.

Gov. Kathy Hochul declared those schemes to be a driving force behind the highest insurance rates in the country during her State of the State address earlier this year. She introduced a plan to limit damages drivers who are found to be “mostly” at fault can win in court and to give insurers more time to investigate claims.

Voters in the state’s 4th, 17th and 18th Congressional districts seem to be on board, according to polling conducted by Impact Research earlier this month. Forty-five percent of likely voters in the three competitive districts say cost-of-living is the most important issue state lawmakers can address this year – a figure far higher than second-place “taxes” at 14%.

“New Yorkers are frustrated with high costs and believe that lawsuit abuse is part of the problem,” said Jeff Liszt, partner at Impact Research. “Across party lines, there is strong support for liability reforms that will lower auto insurance rates.”

Sixty-nine percent of the 1,500 polled say their auto-insurance premiums have gone up in the past year, and 76% say lawsuit abuse is driving up the cost of goods and services. Asked whether they would support or oppose legislation to reform how civil courts handle car-wreck cases, 74% said yes, 5% said no and 21% didn’t know.

Eighty-four percent said it was important for lawmakers to stop lawsuit abuse in auto accidents. The poll was announced this week by Protecting American Consumers Together, a group that advocates for a fair and transparent legal process.

“Voters in these critical swing districts are sending a very clear message: the cost of living is too high, auto insurance premiums keep rising, and families want solutions that address fraud and excessive legal costs driving those increases,” said Lauren Zelt, executive director of PACT.

“This research shows broad bipartisan agreement that reforms focused on protecting consumers and lowering premiums are important to New Yorkers.”

The group has also started a television ad campaign aimed at “billboard lawyers” who game the legal system at the expense of all New Yorkers.

The Lawsuit Reform Alliance of New York has noted that fraud rings target immigrants and others with financial problems to stage crashes, to the detriment of lawful New York drivers whose premiums have risen to about $4,000 annually.

Gov. Hochul also hopes to target doctors who drive up the value of claims with phony diagnoses and unnecessary medical procedures – something lawyers and doctors are accused of conspiring to do in workplace-injury lawsuits in New York.

Hochul said insurers reported more than 38,000 incidents of suspected auto-insurance fraud in 2023, which helped tack an extra $300 onto everyone’s yearly premium.

Her plan will give insurers more than just the current 30 days to investigate and will change a law that allows individuals committing crimes like impaired driving to receive big payouts. To do so, she plans a cap on non-economic damages in those instances.

She’d also follow the lead of other states like Connecticut and New Jersey that permit recovery of damages only if the plaintiff is not primarily at fault. The term “serious injury” also needs to be more clearly defined, as its application is currently inconsistent in courts, she says.

“Car insurance rates are just too damn high, especially at a time when families are feeling squeezed by the cost of living,” Hochul said.

The ride-share company Uber has filed multiple racketeering lawsuits around the country, including in New York, that allege personal injury lawyers are sending clients to meet with doctors willing to perform invasive surgeries in order to increase the value of the claim.

Hochul, a Democrat, might not be the close ally that plaintiff lawyers were hoping for when she took office in 2021. Last year, she vetoed legislation that would have forced out-of-state companies into New York courts and would have allowed wrongful-death plaintiffs more time to sue and recover more.

Florida has been hailed as a guiding light for other states after passing reforms that have stabilized the auto-insurance market and brought down rates for home insurance. Florida’s top five insurers cut rates by an average of 6.5% last year, PACT said.

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