With insurance fraud situations on the rise, lawmakers are being urged by business leaders to pass the legislation that will fight the insurance fraud situation. This is costing the policy holders and the state millions.
The call to action came from Fraud Costs New York, which consists of a coalition of lawmakers, consumers and business leaders. They have called on the State legislature to change the auto insurance system in order to cut down on the insurance abuses and fraudulent charges which have run up to 0ver 200 million dollars last year.
The New York State business Council president Heather Briccetti was heard to say that reforming the no fault system is what will cut down on’ fraud tax’ and thus lower the costs for small businesses all over New York. Funding for criminals has to be cut down by changing the no fault insurance laws was her stand.
The new bill if passed will give insurers the much needed tools to combat fraud and cut down on no-fault costs. There are many criminal enterprises which are uses the loopholes in the laws to the fullest, according to Kristin Baldwin, assistance vice president of the American association of property casualty insurers.
In case of a no-fault insurance company, the situation demands that the company pay all the costs for damages up to the limit placed on the policy irrespective of who is at fault in case of an accident. When people claim for an accident wherein they were not injured or stage accidents to get their hands on this claim, a no fault insurance fraud occurs.
It was the Allstate Insurance Company that announced that it will be filing against 37 New Yorkers who are looking at reclaiming over $2.1million. This came soon after another insurance provider brought up a lawsuit for $4.7 million. From 2003, Allstate has filed lawsuits for more than $167 million worth of damages.
According to investigation by Fraud Costs NY, the cost of coverage for New Yorkers has been on the rise due to the no-fault insurance fraud. Premium rates are on the rise for state residents and for downstate drivers due to this problem remaining unaddressed.
This bill is aimed to bring in a lot of change to the no-fault system in addition to eliminating the need for the insurance company to pay or deny any claims made within a 30 day window. It will also focus on the medical charges that are often excessive and billed unnecessarily. It looks at making the burden of proof more important in clarifying that the services were required medically making the situation more equitable.
