Gov. Kathy Hochul‘s proposed auto insurance reforms, now in budget negotiations that remain unresolved more than five weeks past the April 1 deadline, are framed as a targeted solution to insurance fraud driven by an aggressive plaintiff’s bar.
The narrative being promoted is: cut down on bad-faith claims and bring down auto insurance premiums for New Yorkers. The reality is far more troubling.
New York follows a pure comparative negligence standard, meaning an injured person who bears some share of responsibility for an accident can still recover damages proportional to the other party’s fault. What this means is that if a plaintiff is found to be 50% to blame for an accident, then any recovery that they receive would be reduced by 50% and the same is true for any percentage.
If a plaintiff is 99% to blame for the occurrence of an accident, then they would only be able to recover 1% of whatever the total amount of the damages equals. The proposal put forth by Governor Hochul seeks to make it so that any plaintiff who is found to be greater than 50% to blame for the occurrence of an accident cannot recover anything at all.
The proposals also seek to narrow the definition of what constitutes a serious injury following a car accident. The law currently allows a plaintiff who suffers a medically determined injury of a non-permanent nature that prevents them from performing all of their customary daily activities substantially for at least 90 out of the first 180 days following the accident to obtain damages from the defendant who caused such injuries.
For example, if a plaintiff is injured and caused to miss three months of work, and this is substantiated by a doctor attesting to that fact, then that plaintiff is allowed to recover damages.
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The basis for the proposed changes rests on the premise that such injuries are difficult to see and, therefore, easier to fabricate. The real motivator behind these proposals comes from insurance companies that must defend and ultimately pay for substantiated claims, as well as Uber, which has poured more than $10 million into lobbying this cause. Soft-tissue injuries — herniated discs, cervical strain, radiculopathy, chronic pain conditions — are among the most common and genuinely disabling consequences of motor vehicle accidents.
They are diagnosed and treated by orthopedic surgeons, neurologists, and pain specialists every day. Casting suspicion over this entire category of harm does not identify dishonest claimants; it simply makes it harder for honest ones to prove their cases — and harder still to recover damages that are fully documented and directly tied to their injuries.
No serious advocate for injured people objects to holding bad-faith claimants accountable. But when those tools are deployed by parties with a direct financial interest in denying claims, they become instruments of delay and denial. Mandatory fraud review periods stretch timelines, forcing economically vulnerable claimants toward inadequate settlements.
So-called “independent medical examinations,” conducted by physicians chosen and compensated by insurers, routinely contradict treating doctors. The mere threat of a fraud referral chills legitimate claims before they are ever filed. These are not hypothetical risks. They are the documented experience of injury victims in states that pursued similar reforms without meaningful protections for claimants.
If Albany is serious about targeting fraud without punishing victims, the enforcement framework must include concrete safeguards: clear evidentiary standards before any fraud referral can be triggered; strict timelines that prevent delay from becoming a litigation strategy; neutral, accountable processes for medical evaluations; real penalties for bad-faith use of enforcement mechanisms against claimants whose injuries are ultimately validated; and transparent public reporting on how these tools are actually being used.
Without these protections, “fraud enforcement” becomes a label covering harms to people who have done nothing wrong.
Fraud is real. So is the temptation to use it as a justification for denying legitimate claims. The people who will bear the cost of getting that balance wrong are injured New Yorkers whose losses are real, whose documentation is sound, and whose access to justice is being quietly legislated away under the banner of reform. That demands a far more honest reckoning than this proposed budget provides.
Eric Subin is a New York trial attorney and partner and founder of Subin LLP.