Our Bureau
Albany, NY
Governor Kathy Hochul announced an agreement in the FY 2026-27 State Budget to tackle skyrocketing auto insurance premiums and provide direct relief to millions of New York drivers. By modernizing the state’s insurance laws and launching an aggressive crackdown on rampant fraud and abuse, the deal addresses the root causes of an affordability crisis that has left New Yorkers paying nearly double the national average for coverage.
“This agreement is a big win for New Yorkers struggling to get by in the midst of an affordability crisis. For too long, drivers in this state have been paying nearly double the national average for auto insurance, while broken systems and rampant fraud have driven costs through the roof. Governor Hochul and lawmakers have taken decisive action to address the root causes of this crisis. By strengthening enforcement and modernizing outdated rules, they are helping put money back in people’s pockets. These reforms will bring real relief for working families and mark a meaningful step toward making New York more affordable.” — José Bayona, spokesperson for Citizens for Affordable Rates (CAR):
Lowering Auto Insurance Rates for Everyday New Yorkers
New Yorkers pay some of the highest car insurance rates in the nation, totaling just over $4,000 annually on average — nearly $1,500 above the national average. Car insurance rates are driven up by a combination of fraud, litigation, legal loopholes, and enforcement gaps, with staged crashes and associated insurance fraud inflating everyone’s premiums by as much as $300 per year on average, according to some estimates.
The final Budget will put money back in New Yorkers’ pockets through a series of common-sense legislative reforms that will prevent bad actors and fraudsters from exploiting the system and hold insurers accountable to pass their savings on to consumers.
The final State Budget will:
· Cap payouts for drivers engaging in criminal behavior at the time of the incident, including uninsured motorists, drunk drivers, and drivers in the act of committing a felony.
· Better define what actually constitutes a ‘serious injury’ so that damages for pain and suffering or emotional distress are reserved for those able to objectively demonstrate that they have suffered a serious injury.
· Ensure that if a driver is found to be mostly at fault for causing an accident, they cannot claim outsized payments for damages.
· Prevent insurance companies from exorbitantly raising rates by setting a legal threshold that prevents excess profits and returns savings to consumers.
· Create new regulatory safeguards to prevent insurance companies from raising rates without seeking express approval from the Department of Financial Services.
· Protect consumers by prohibiting insurance companies from setting rates based on extraneous, personal factors like homeownership status, occupation, education level or zip code.
These measures complement the Governor’s whole-of-government approach to combating fraud by tasking DFS, DMV, DCJS, and NYSP with a more proactive, coordinated effort.
About Citizens for Affordable Rates (CAR)
Citizens for Affordable Rates (CAR) is a coalition of citizens, advocates, and organizations dedicated to tackling the root causes of high auto insurance costs in New York. Through advocacy, education, and policy reform, CAR is committed to building an affordable and dependable system for all New Yorkers. For more information, visit: www.citizensforaffordablerates.com
