More than a dozen clergy members have signed onto a letter calling on legislators to reject Gov. Kathy Hochul’s proposal to reform car insurance in New York.
Hochul has made reducing the state’s high car insurance rates a cornerstone of her affordability agenda this year. As part of her executive budget proposal, she included measures meant to crack down on fraud that has driven up insurance premiums and to amend the laws governing payouts to prevent lawsuit abuse – including by redefining the meaning of “serious injury” and limiting the damages paid by people who are only “mostly” at fault.
Echoing complaints from street safety advocates, the clergy members who signed the letter argued that the governor’s proposals would weaken protections for crash victims. The letter specifically cites the redefinition of “serious injury,” which could limit the compensation awarded to people who suffer debilitating short-term injuries following a crash. “In our congregations, we walk alongside families who are already living paycheck to paycheck,” the letter reads. “When injured members of our communities are denied a fair path to recovery, families fall behind on rent, delay necessary medical care, and are pushed into financial crisis.”
Hochul’s proposals have gained a significant amount of support from business groups, local political leaders and a few unions. Hochul’s budget director Blake Washington told City & State last week that people speaking to him about totally unrelated parts of the budget have said how much they appreciate the prospect of lower car insurance rates. “We have nonprofit providers that are coming in and they don’t represent anything to do with car insurance, just representing their own interests,” he said. “They’ll say, ‘Oh, by the way, thanks for the auto insurance, I hope that works because it’ll help my employees.’”
But Uber has pushed for the reforms as well, and the company is pouring millions into a super PAC supporting Hochul for reelection. A number of street safety groups and trial attorneys have come out in opposition to the measures. And lawmakers expressed at least some skepticism of Hochul’s proposed reforms during a recent joint legislative budget hearing.
The Concerned Clergy of New York State and New York City also took issue with the fact that Hochul’s reforms don’t address the issue of discriminatory car insurance pricing. They cited numbers from the Consumer Federation of America that found zip codes that were majority people of color paid higher premiums than zip codes that had a majority white population. The group also determined that those with lower credit scores had higher premiums, a fact compounded greatly in zip codes with majority Black or Latino populations.
“Insurers are applying surge pricing to communities of color through modern-day redlining,” said Rev. Carl Washington, one of the letter’s signers. “In New York, a cautious driver could face thousands of dollars in higher premiums – not because of their driving record, but simply based on where they live or their credit score.”
A spokesperson for Hochul defended the proposals in a statement to City & State. “Governor Hochul is committed to enhancing safety on New York’s roads and driving down the exorbitant costs of auto insurance for everyone,” the spokesperson said. “Governor Hochul’s plan will bring down costs, hold bad actors accountable and put an end to fraudulent stunts that put people in harm’s way.” Her office also referenced support from the Rev. Al Sharpton for the governor’s proposed reforms, and members of her administration have contended that the change to “serious injury” would not impact crash victims who suffer short-term injuries like concussions.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.