LATHAM, NEW YORK – A recent report claims that policy holders in New York pay 55% more than what they used to.L
New York policy holders find that the usual payments they make for the state’s no-fault system have risen by nearly 55%. Starting on second quarter of 2009, an estimated $8,748 increase per claim has been charged to policy holders.
According to reports published by the Insurance Information Institute (I.I.I.), the increase this year has been too shocking and too much for the public to take. Rates have shot far up from where it was back in 2004, when average payments made for the no-fault system was $5,615 per claim.
Because of a steep hike in premium payments, the National Insurance Crime Bureau, New York State Insurance Department’s Frauds Bureau, law enforcement agencies, and insurance industry members in New York have initiated vigorous investigations regarding the matter, paying special attention to suspicious and fraud-like claims. Dr. Robert Hartwig, economist and incumbent I.I.I. President, also takes part in the investigation regarding this issue. Reports indicate that a recent statement released by Dr. Hartwig shows that certain ambiguities in New York’s no-fault system make it very much susceptible to scams and fraudulent activities. A number of corrupt medical practitioners, lawyers, and common street criminals make it possible for a fraudulent no-fault industry to exist.
According to reports, Dr. Hartwig mentioned some of his observations during the New York Insurance Association’s (NYIA) annual meeting in Latham, New York. Reports show that Dr. Hartwig implied that a majority, if not all, auto insurance companies in New York have made an astonishing 55% increase in the usual cost of no-fault claims during less than 5 years duration.
Today, the amount consumers pay for no-fault claims in New York is second highest in the United States. Rates of New York’s no-fault claim are 111% higher than national average.
The highly publicized issue on extreme no-fault claim payment had caused a lot of negative reaction from New York motorists. Reports from auto insurance companies based in the state, a large percent of their customers have chosen to terminate policies and transferred to different insurance agencies. The public in New York has remained aloof to car insurance companies and are very touchy when it comes to issues regarding fraud and scams in car insurance claims. The public has lost its trust in the state’s no-fault claim system.
Some say that until official investigations conducted by New York authorities have shown any good results, the state of public perception regarding this issue will remain the same.