New York Making No Fault Auto Insurance Changes To Reduce Fraud
December 6th, 09The number of no-fault insurance fraud cases have risen steadily in New York with 11,000 incidences reported already this year. Compared to last year this is a seven percent increase. The New York State Insurance Department is suggesting changes be made in required auto insurance coverage to hopefully eliminate the number of fraud cases. The changes will impact consumers in terms of the insurance requirements and the cost of auto insurance.
In general the proposed rules give insurance companies much more leeway when it comes to handling what it suspects are fraud cases. For example, one proposal is to make it easier for insurance companies to dispute health care charges that exceed appropriate free schedules. In another proposal the insurance company would be allowed to suspend medical payments related to the insurance claim if fraud on the part of the medical clinic is suspected.
The New York State Insurance Department has been working hard to find ways to reduce auto insurance fraud because consumers pay higher rates than would be required if fraud was lessened or eliminated. Currently New York Drivers are paying the second highest auto insurance rates in the United States. The cost of fraud cases is passed on to consumers through insurance premiums and is often called a fraud and waste tax.
No fault automobile insurance coverage allows a victim of a car accident to file claims with his or her own insurance company to collect medical payments and lost wages. It does not matter who caused the accident and thus the no-fault designation. But some of the costs of the no fault claims is related to court cases involving disputed medical claims.
The proposed regulations would make changes to the medical forms so insurance companies are better able to determine legitimate claims. This could speed up the settlement of legitimate claims. Some of the proposed regulation changes benefit the insured directly. For example, auto insurers would have to schedule medical exams for the insured so the exams are conveniently located and at reasonable times.
Another proposal is to increase the maximum attorney fee so the insured can be adequately represented. A minimum attorney fee would be eliminated in an effort to promote consolidation of claim cases.
Fighting waste and fraud with regulatory changes in the New York auto insurance industry is important if consumers want to see their insurance premiums contained over the coming years. The New York State Insurance Department has a fraud division that specializes in investigating fraud cases. Some of the fraud cases are instigated by organized groups that involve medical clinics and even attorneys and they operate throughout the state.
The changes to Regulation 68 are still in the draft stage and comments from the public are welcomes. It is expected that most changes as proposed will be adopted along with others being suggested. The consumer is likely to benefit once that happens as auto insurance costs are contained in the state of New York.
Tags: car accident, insurance requirements, No-fault insurance, auto insurance industry, auto insurance costs, Vehicle insurance, auto insurance rates, Types of insurance, auto insurance fraud, insurance premiums
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