ALBANY, N.Y. — Gov. Kathy Hochul on Tuesday unveiled a sweeping package of proposals aimed at lowering auto insurance premiums in New York by cracking down on fraud, tightening legal standards and increasing transparency for consumers.

New Yorkers pay some of the highest car insurance rates in the country — averaging more than $4,000 a year, nearly $1,500 above the national average. State officials say fraud, litigation loopholes and weak enforcement have driven up costs, with staged crashes alone adding an estimated $300 annually to the average premium.

“For most people, car insurance isn’t a luxury — it’s a necessity,” Hochul said, noting that families, particularly on Long Island, rely heavily on their vehicles for work, school and daily errands. She said the plan targets “bad actors” while protecting hardworking drivers.

Fraud Cases Surge Across New York

State data show a sharp rise in suspected fraud. Insurance carriers reported 43,811 suspected motor vehicle fraud cases to the Department of Financial Services in 2025, up from 24,238 in 2020 — an 80% increase. In 2023, New York recorded 1,729 staged crashes, ranking second nationwide.

Officials say increasingly sophisticated criminal networks are staging elaborate accidents designed to trigger large insurance payouts or jury awards.

Key Proposals in Hochul’s Plan

Hochul’s proposal includes a broad set of reforms designed to reduce fraud and limit costly litigation:

• Revitalizing the state’s Motor Vehicle Theft and Insurance Fraud Prevention Board.
• Expanding prosecutors’ authority to pursue criminal charges against organizers of staged crashes.
• Cracking down on medical providers who approve fraudulent diagnoses.
• Targeting drivers who illegally register vehicles out of state to lower coverage costs.
• Extending the time insurers have to investigate and report fraud beyond the current 30-day limit.

Limiting Damages and Legal Reforms

The governor is also seeking to limit non-economic damage awards — such as pain and suffering — for drivers engaged in criminal activity at the time of a crash, including impaired or uninsured motorists. Additionally, drivers deemed mostly at fault in an accident would face new limits on compensation.

Hochul plans to tighten New York’s “serious injury” threshold under its no-fault insurance law by establishing clearer medical standards, a move aimed at reducing costly and inconsistent litigation.

Another proposed reform would adjust joint and several liability rules so defendants less than 50% at fault would only be responsible for their share of damages — aligning New York with most other states.

Ensuring Savings Reach Consumers

To ensure drivers benefit from potential savings, Hochul said the state would review its Excess Profit Law, which requires insurers to return profits above a certain threshold to policyholders.

She also pledged to increase transparency by requiring insurers to clearly notify policyholders of rate increases and explain the reasons behind them. Insurers would also be required to offer discounts for drivers who voluntarily enroll in safe-driving programs that use technology to reduce unsafe behavior and fraud.

Support From Local Leaders

Local officials and business leaders across Long Island praised the proposals, saying high premiums strain families and small businesses already grappling with rising living costs.

The legislative package is expected to be introduced in the upcoming session. If enacted, Hochul said the reforms would help make New York more affordable and put money back in the pockets of drivers statewide.