On Tuesday, November 24, 2009, New York Superintendent James Wrynn released a draft of revised rules for no-fault automobile insurance (the “Proposed Draft”). If promulgated, the Proposed Draft would be the first significant regulatory reform to no-fault automobile insurance in New York since 2002. The goal of the Proposed Draft is to “reduce fraud and abuse associated with no-fault claims, while making the no-fault system more user-friendly,” and in turn should lead to lower premiums for insureds.
The reforms in the Proposed Draft would also benefit insurers by:
- Revising current prescribed forms to require additional information to reduce the need for verification that the claims paid are medically necessary;
- Providing more discretion to deny health services that do not comply with the applicable fee schedule; and
- Simplifying the procedure for suspending payments to medical clinics whose license status is under investigation due to allegations of fraud.
The Proposed Draft also seeks legislative action to help eliminate steering and stop individuals and providers from flooding the claims system in order to receive mandatory claim payments.
Comments on the Proposed Draft may be sent to the New York State Insurance Department on or before January 8, 2010.
Click here to view the Proposed Draft and here to view the official press release.