Brooklyn Borough President

BOROUGH PRESIDENT MARTY MARKOWITZ PUTS
THE BRAKES ON OUT OF CONTROL AUTO INSURANCE RATES

In photo from left to right: Member of the Task Force and Counsel to the Borough President Fred Arriaga, Borough President Marty Markowitz, and Assemblymember James Brennan.

Photographs by Kathryn Kirk

In photo from left to right: Member of the Task Force and Counsel to the Borough President Fred Arriaga, Borough President Marty Markowitz, and Assemblymember James Brennan.

Task Force releases report outlining ways to reduce Brooklyn’s
record high auto insurance rates

On Tuesday, October 19, Borough President Marty Markowitz and Assemblymember Jim Brennan presented the findings of a report called “Putting the Brakes on Out of Control Rates: An Examination of Brooklyn's Record High Automobile Insurance Rates and How They Can Be Reduced.”

“Brooklyn drivers cannot afford and should not have to pay the highest auto insurance rates in the country,” said Borough President Markowitz. “Today we are releasing the findings of an important study that will put the brakes on Brooklyn’s out of control rates. We are calling for a drastic revision of the entire auto insurance system so that all Brooklynites will have access to the affordable car coverage that drivers, in other boroughs, around the state, and across the country take for granted.”

The auto insurance system in Brooklyn is in crisis. Brooklynites pay thousands of dollars more for car insurance than residents in any other part of the country. For example, a 35-year old male with a good driving record in Albany pays about $420 for basic coverage. That same driver living in Brooklyn would have to pay over $2,600 which is a difference of over 600%. Because of this unfair auto insurance rate system, many Brooklynites are left with three impossible choices – pay these astronomical rates, register their cars out of state or drive without insurance.

According to the report, Brooklyn's rates are so outrageous because of fraudulent claims and the lack of resources allocated to fight fraud. The cost of fraudulent no-fault personal injury claims in Brooklyn alone is estimated at about $500 million a year — or more than one-third of the costs in the entire state. Below are some of the ways we can put the brakes on the high auto insurance rates that unfairly penalize Brooklyn drivers.

· Identify and regulate illegitimate health clinics that are abusing the no-fault system. Prevent people from approaching auto accident victims at hospitals and steering them to these clinics.

· Increase funding and coordinate law enforcement efforts to combat abuses of the no-fault insurance system.

· Establish an Office of Automobile Insurance Consumer Advocate & Counsel within the Office of the New York State Attorney General to protect the rights of auto insurance customers.

· Create a pilot program to suspend no fault auto insurance policies issued to Brooklyn residents. A special court would be established to handle all resulting lawsuits.

· Provide resources to conduct public awareness campaigns in multiple languages. Encourage insurance companies to also conduct fraud awareness campaigns.

· Prevent insurance companies from unfairly discriminating against Brooklyn drivers by prohibiting a driver's zip code to be a factor in determining the cost of car insurance.

· Encourage national insurance companies to offer more affordable coverage in areas with disproportionately high rates.

This study was prepared by the Borough President’s Task force on Equity in State and Local Policy, chaired by Asssemblymember James Brennan.