Forty-three companies – covering 75 percent of New York drivers – had rate filings pending on August 6, when the New York Insurance Department required companies to demonstrate how they were factoring in reduced driving when setting new rates. As a result, many of the companies withdrew or dramatically reduced their filed increases. Additionally, insurers that failed to provide adequate support for their filing or failed to respond to the Insurance Department's directive will not have their requested increases approved. New York residents already pay approximately $10 billion annually in auto insurance premiums.
“It’s simply counter-intuitive to increase rates by eight percent when people are driving less. Because of higher gas prices, New Yorkers are driving less and having fewer accidents as a result,” said Governor Paterson. “New York’s auto insurance rates are already the third highest in the nation, and if the original requests for rate increases had been approved, it would have cost New Yorkers more than $600 million. By working with these insurance providers, we have helped provide $515 million in badly needed relief for New Yorkers.”
Insurance Superintendent Eric Dinallo said: “There is a clear trend toward driving less. Since trends are an important factor in setting auto insurance rates, we would have been remiss had we gone ahead with business as usual. It is common sense: when gasoline prices are high, people drive less. When people drive less, they have fewer accidents and fewer claims. And the insurance rates should reflect that. Setting the correct rate is too important both to consumers and to fostering a vital, competitive auto insurance industry.”
On September 30, the U.S. Department of Transportation (DOT) released new data showing that July marked the ninth straight month to see a decline in driving nationally. Since last November, Americans have driven 62.6 billion fewer miles than they did over the same period a year earlier – topping the previous peak decline in 1970’s of 49.3 billion miles. In the summer months of June and July 2008, New Yorkers drove 907 million fewer miles than in June and July of 2007.