New York‘s $263 billion state budget has been stuck well past its April 1 deadline, and one of the biggest issues it’s facing has very little to do with traditional spending. Instead, there’s a fight going on over car insurance between Governor Kathy Hochul and legislative leaders.

Hochul has made lowering car insurance rates a large part of her agenda this year. Her proposal looks to reduce costs by targeting fraud, staged crashes and expensive litigation. It basically limits the ability of drivers with minor injuries to pursue expensive claims, lowering payouts for insurance companies and, theoretically, lowering prices for consumers.

But Senate Deputy Majority Leader Michael Gianaris has criticized this idea and Assemblymember Jeffrey Dinowitz has added that this legislation doesn’t actually guarantee that insurance rates will fall. Senate Majority Leader Andrea Stewart-Cousins and Assembly Speaker Carl Heastie are pushing against it.

There’s now a lobbying war between trial lawyers, insurers, and rideshare giants like Uber. Trial lawyers, who stand to lose substantial revenue if injury payments are tightened, have poured money into this fight. In fact, they’ve added nearly $3 million to more than 300 campaigns since 2021. Hochul’s campaign has received roughly $200,000 from auto insurers during the same period. In response to the pushback, the governor’s office has openly attacked dissenting lawmakers, accusing them of “defending a broken system that benefits the trial lawyers”.

Despite this, Hochul continues to argue that the fight is a necessary thing to lower expenses. Her administration argued that New Yorkers pay an average of $4,000 a year for car insurance, roughly $1,500 above the national average. Staged crashes and other fraud add an estimated $300 to those annual premiums. Her office also recently announced that the reforms would protect public transit from ‘jackpot’ legal settlements, saving the MTA an estimated $48 million annually.

So, while insurers promise that lowering the cost of liability and litigation will eventually trickle down to those signing the checks, there is no mandated pass-through forcing those savings into the pockets of everyday drivers. Until that is changed, there’s still a fight ahead.