A proposal to reduce auto insurance costs in New York has sparked a dispute between the ride-share company Uber and the New York State Trial Lawyers Association, two influential groups with significant lobbying presence in Albany.
The proposal, introduced by Gov. Kathy Hochul, aims to lower insurance premiums for drivers in a state where costs rank among the highest nationwide. According to the Citizens Budget Commission, the average annual premium in New York reached $1,896 in 2023, 32% above the national average.
The governor’s plan includes several changes to the current system. It would cap damages for pain, suffering, and emotional distress at $100,000 in cases where individuals are uninsured, impaired, or committing a felony at the time of an accident. It would also narrow the criteria used to define a “serious injury.” In addition, drivers found to be more than 51% at fault in a crash would not be eligible to seek compensation beyond the $50,000 provided under no-fault coverage.
Uber has supported the proposal and invested approximately $8.3 million in lobbying efforts through the group Citizens for Affordable Rates. The company has also funded advertising campaigns and outreach efforts encouraging public support for the measure. According to a company spokesperson, more than 72,000 letters from drivers and riders have been sent to state lawmakers. Uber has stated that rising insurance costs affect both drivers and passengers, noting that insurance-related fees can account for about $5 of a $20 ride.
Supporters of the proposal, including the governor, have pointed to fraud as a contributing factor to rising premiums. In 2023, New York reported 1,729 staged car crashes, the second-highest number in the country, according to the Department of Financial Services. The administration has argued that legal loopholes and fraudulent claims increase costs within the system.
The New York State Trial Lawyers Association has opposed the proposal. The group has a long-standing presence in state politics and has contributed approximately $7.5 million to campaigns over the past decade, along with about $16 million in lobbying expenditures. The association has also supported legislative efforts related to liability and damages, including changes to wrongful death laws and insurance coverage requirements.
Andrew Finkelstein, the association’s president, has raised concerns that the proposed limits could reduce compensation for individuals involved in legitimate accidents. He has also stated that fraud accounts for a smaller portion of cases than suggested and questioned whether the proposed reforms would lead to lower premiums.
Some lawmakers have expressed hesitation about the proposal. Senate Majority Leader Andrea Stewart-Cousins said discussions have focused on whether the changes would yield measurable cost reductions for drivers.
The debate has contributed to delays in finalizing the state’s budget, which has extended past its April 1 deadline. The proposal’s outcome remains under negotiation as stakeholders continue to present competing perspectives on its potential impact.
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