ROCHESTER, N.Y. — New York Gov. Kathy Hochul is taking action to address the high auto insurance rates in the state, which are among the highest in the nation. Hochul aims to reduce these rates by focusing on insurance fraud prevention.

“New Yorkers pay the highest auto insurance rates in the nation, averaging $4,000 a year, $1,500 more than the national average,” Hochul said in her State of the State address.

In 2023, more than 38,000 suspected insurance fraud cases were reported in New York. Hochul plans to tackle this issue by increasing efforts through the State Motor Vehicle Theft and Insurance Prevention Board. This includes utilizing dedicated staff and resources at the DMV, state police, and Department of Financial Services.

“When the system allows out of control payouts, those costs get passed on to you in the form of higher monthly premium bills,” Hochul said. “And if you are driving drunk, driving without a license, or committing a felony at the time of the crash, you should not get a payday.”

Hochul’s strategy involves a multi-agency approach to catch fraudsters, with tougher penalties. She also plans to increase oversight on medical providers who sign off on bogus injury claims and drivers who illegally register their cars out of state.

David Kirst from AAA of Western & Central NY says insurance fraud can have a major impact on auto insurance rates. “It’s a big portion of it,” he said. “You know, in the article it show that it could cost the average driver almost $300 a year,” Kirst said. “And some studies show that it could actually be a higher rate on there because of that. So any way to crack down on a lot of that fraud is welcome in the market.”

These initiatives aim to help drivers like Douglas Phillips, a medical courier, who shared his experience with insurance fraud. “I’ve been a part of insurance fraud. Somebody did the whole rear end on me a long time ago. They didn’t have insurance. I had insurance. They got the full benefit, and I got nothing out of it,” Phillips said.

In addition to combating insurance fraud, Hochul plans to increase transparency for policyholders, improve incentives for safe driving, and limit damages for drivers mostly at fault in accidents.

Governor Hochul’s office told News10NBC the exact timeline and cost of the new implementations will depend on when the 2026 New York State budget passes.

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