The war on auto insurance prices in New York

Daily Point

Driving into battle

The biggest debate in Albany as budget season heats up is about auto insurance.

And some of New York's biggest forces are emerging as key players in the showdown over Gov. Kathy Hochul's proposals to tackle auto insurance fraud by limiting payouts to bad actors, prioritizing consumers and combating the potential for staged accidents. Such changes, she says, will result in lower premiums for all car owners.

The fight has already flooded the airways and legislative offices, but is expected to also play out during Thursday's economic development budget hearing in Albany.

On one side, there's the insurance industry and, more significantly, Uber, which is financing a $7 million independent expenditure committee to support Hochul's efforts.

On the other, there's the powerful New York State Trial Lawyers Association, which opposes the restrictions. Separately, good government groups have expressed their own concerns and questions about the Hochul strategy.

"There is a King Kong versus Goliath element to the whole thing," one political observer said. "It's not entirely clear how this plays out, and it will come down to how much does the governor dig in."

The battle revolves around Hochul's proposals to crack down on auto insurance fraud, including staged accidents, by empowering the state's Motor Vehicle Theft and Insurance Fraud Prevention Board to support fraud-related investigations and prosecutions and allowing prosecutors to seek criminal penalties against anyone involved in organizing a staged accident, as opposed to just the driver. She also would limit insurance payouts for those who commit illegal acts in the course of an accident, such as impaired driving, and firm up the definition of serious injuries. Hochul has said that in 2025, insurance carriers reported 43,811 suspected car insurance fraud cases, including 1,729 "staged crashes."

Hochul, who has framed the issue as part of her affordability agenda, also wants to extend legislation that would require insurers to return profits above a certain point to consumers.

The governor has noted that in Florida, where similar reforms have been made, "insurance rates literally plummeted."

Boosting her view is a seemingly unlikely bedfellow: Uber. Uber's independent expenditure committee, Citizens for Affordable Rates, has filed registration paperwork with the state indicating plans to spend $7 million by the end of the year. The group already has launched widespread television and digital ad campaigns.

An Uber spokesman told The Point that the ride-sharing giant is "likely the largest consumer of insurance in the U.S." Outside of New York City, a third of the cost of every ride in the state goes to insurance.

So, for every $24 Uber ride a Long Islander might take, $8 goes to insurance costs.

Hochul's reforms, the spokesman said, "will reduce our costs."

"If we can save money on that formula and can reduce that to $6, making the trip $22, New Yorkers will take more trips and we will make more money," he said. "We could drop our prices so more people will use the service."

Among the other advocacy groups supporting Hochul's plans is Protecting American Consumers Together, a 501(c)(4) that just this week released data from a new poll of three New York congressional districts, including CD4, that showed broad support of the auto insurance fraud reforms. The poll showed that 75% of CD4 voters said their auto insurance rates had gone up in the last year, and that 79% of those voters would support "legislation to reform the cost of lawsuits, settlement and related legal fees to reduce the cost of your auto insurance." The poll also specifically targeted the legislature, finding that 84% of those polled would support a lawmaker that supported the reforms.

This won't be an easy fight, though.

The trial lawyers association, whose members earn fees bringing cases against the insurance firms, is prepared to try to stop the governor's plans, arguing they "do nothing to address fraud."

"What they do is limit injured victims' rights and make it harder to access the courts and put the burden ... on taxpayers rather than on the at-fault party and their insurance," said association spokeswoman Sabrina Rezzy. "It's an insurance company giveaway that makes it harder for victims to recover [funds], reduces the legal rights of New Yorkers, and helps insurance companies limit their exposure."

The trial lawyers will rely on in-house lobbying, according to registration paperwork signed by Rezzy.

Rezzy argued that trial lawyers represent their clients on a contingency basis, including "people who can't afford to go up against a big corporate insurance company."

Most lawsuits are settled out of court.

But Hochul spokesman Gordon Tepper said the notion that the governor's proposals would hurt accident victims was "nonsense."

"The governor is fighting to lower car insurance for everyday New Yorkers," Tepper said. "Anybody who is standing in the way of this proposal will have to justify their rationale."

Rezzy emphasized that the trial lawyers aren't alone in their opposition, pointing to consumer and good government groups like the New York Public Interest Research Group.

But NYPIRG senior policy adviser Blair Horner said his concerns differ somewhat from the lawyers'.

"Our recommendation to the legislature is to kick the issue out of the budget and do what you're supposed to do — hold public hearings, tell us what the problems are, and develop policy to react to those problems," Horner said. "Lawmakers and the governor have a real responsibility to get in under the hood and find out what the problem is that is unique to New York and that New York can really do something about."

Rather than a sole focus on fraud or compensation for injured victims, Horner said he'd like to see a spotlight on how insurance companies set rates, noting that often, both driving experience and non-driving related issues, such as credit scores, are used but that much of that process remains shrouded in secrecy in New York. Horner also recommended that the state consider providing a dashboard that allowed consumers to comparison shop, similar to one that California offers.

"The propaganda tail is wagging the affordability dog," Horner said. "Let's deal with the dog, not the tail." 

— Randi F. Marshall randi.marshall@newsday.com

Pencil Point

Gavel falls

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Final Point

Rumor quashed: Calone isn't running for Congress

Former Democratic candidate for Suffolk County executive Dave Calone is not running for Congress, he told The Point, despite being asked to consider jumping into what would be a tough fight to oust a GOP incumbent.

Calone poured cold water on rumors rumbling in Long Island's political circles that he is building a campaign to challenge Rep. Nick LaLota (R-Amityville) for CD1. "I have had a bunch of people reach out to me on the New York One congressional seat encouraging me to run, which is very kind of them. But I'm not going to do that," he said.

Calone's got name recognition in Suffolk and electoral experience. In 2023, he lost to Republican Ed Romaine for Suffolk County executive by 14 points, 57-43. In 2016, he lost to Anna Throne-Holst in the June Democratic primary for CD1. Throne-Holst lost the general election for CD1 to former Rep. Lee Zeldin — now the administrator of the Environmental Protection Agency — by 16 points.

Months later, in the 2016 November general election, Calone, this time running on the now defunct Independence Party line, lost a bid for state Supreme Court justice in the 10th Judicial District. The top two vote-getters in that race were cross-endorsed by the Democrats and Republicans.

For the 2026 CD1 race, two Democrats who recently filed Federal Election Commission campaign finance reports trail LaLota by more than $2 million combined.

Christopher Gallant reported just under $48,000 cash on hand and Lukas Ventouras reported just under $24,000 cash on hand. LaLota, reaping the fundraising benefits afforded incumbents, reported a little over $2.6 million cash on hand.

The Cook Political Report last month rated New York's CD1 and CD2 as "solid Republican," meaning the races "are not considered competitive and are not likely to become closely contested."

Southold Town Democratic Party chair Kathryn Casey Quigley told The Point that Gallant is "quietly gathering support" after a big initial campaign announcement last August.

— Mark Nolan mark.nolan@newsday.com

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