Flawed legislation severely limits consumer choice and could increase the cost of insurance
ALBANY, N.Y., Aug. 6, 2012 /PRNewswire-USNewswire/ -- The New York Insurance Association (NYIA) calls on Governor Cuomo to veto legislation adopted in the final hours of legislative session that will take away a consumer's right to choose and likely result in drivers paying more for their auto insurance. The legislation would adversely impact both consumers and businesses.
The legislature passed S7787/A10784, which amends the supplementary uninsured/underinsured motorist (SUM) law. "The legislation severely limits consumer choice—specifically requiring policyholders to opt-out of additional insurance coverage versus the current, more transparent process of opting-in," Ellen Melchionni, president of NYIA said. "If you've ever had to successfully opt-out of a service before, you know that it's basically a form of coercion. The legislation would be detrimental to consumers—individuals could end up paying a lot more for coverage that they didn't even want."
The bill is particularly troubling since the legislature did not pass meaningful no-fault auto insurance reform. "The bill adds insult to injury," Melchionni said. "The legislature did nothing to address the enormous cost of auto insurance fraud and instead passed a bill that could further increase the cost of insurance. It was crucial that elected officials act this year to pass reform. Instead, legislators passed a bill that will negatively impact consumers and potentially, unnecessarily increase the cost of auto insurance."
Individual policyholders and businesses alike could see an increase when they receive their next auto insurance bill. "This legislation is far from the answer that New York's citizens and businesses have been looking for over the past two years as fraud has increased with innocent policyholders paying the price," Melchionni said. "We are asking that the Governor veto this measure so an already bad situation isn't made worse."
"Governor Cuomo has been steadfast in his commitment to protect consumers and enable businesses to thrive," Melchionni said. "Legislation that is negative for both consumers and businesses is counterintuitive to what the Governor stands for when it comes to a new New York."
The New York Insurance Association (NYIA®) is a state trade association that has represented the property and casualty insurance industry for 130 years. For more information about NYIA, visit www.nyia.org.
SOURCE New York Insurance Association