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New York auto insurance regulation change sought

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New York auto insurance regulation change sought

More than 20 business organizations sent a letter to New York’s state senators Monday urging them to repeal an auto insurance regulation in place since 1978 they say is outdated.

The New York Insurance Association, the National Federation of Independent Business-New York, Associated General Contractors of New York State and The Business Council of New York State were among the groups signing the letter calling for passage of S6028, called the Auto Insurance Consumer Relief Act.

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The bill is sponsored by Senate Insurance Committee Chairman Neil Breslin, D-Albany, and is cosponsored by nine Democrats and six Republicans. It would eliminate a state regulation requiring insurance companies to take pictures of vehicles tied to comprehensive and collision policies. New York is one of five states that maintain the requirement.

The regulation was issued nearly 45 years ago to fight insurance fraud. However, the letter states that the former chief inspector of the Property and Casualty Insurance Bureau, who is considered the “father” of the regulation, said it’s no longer an effective tool.

New York auto insurance regulation change sought

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“Mandatory photo inspections are a burden to consumers and put them at risk of losing coverage if the inspection is not completed within a short timeframe,” the business groups wrote. “These inspections are no longer necessary due to transformative advances in how insurance companies identify and prevent fraudulent claims.’’

Still, the bill gives insurance providers the option to continue requiring the photos if they consider it necessary.

A6877, a sister bill sponsored by Assemblyman Ken Zebrowski, D-Clarkstown, passed in the Assembly on March 30 by a 118-30 vote.

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Opponents say it could cost New York jobs, including 300 at CARCO, a Long Island business that fights fraudulent insurance claims. During the vote, Assemblyman Doug Smith, R-Holbrook said on the Assembly floor that big insurance firms care more about acquiring new customers than the potential for fraud.

New York auto insurance regulation change sought

“It’s not a photo-taking program. It’s a fraud-prevention program,” Smith said. “And when we prevent fraudulent claims, we’re keeping the rates lower for ratepayers.”

Zebrowski countered that there have been several developments to fight insurance fraud since the state enacted the regulation.

“The fact of the matter is we need to update our regulations,” Zebrowski said on March 30. “We need to take regulations off of folks that are costing them time and money.”

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