Allstate responded April 26 to the Insurance Information Institute’s (III) announcement that fraud and abuse in New York State’s no-fault auto insurance system remains at crisis levels. III also revealed the estimated ‘fraud tax’ that New Yorkers paid in 2010 was $204 million—an amount exceeding $200 million for the second consecutive year. The New York State Senate Insurance Committee is holding a hearing on April 26 to examine the issue more closely.
Krista Conte, New York spokesperson for Allstate Insurance Company, said in response to the III announcement:
"We agree with the Insurance Information Institute that the scale of fraud and abuse in New York State's no-fault auto insurance system today has reached crisis levels. Not only is no-fault fraud (auto accident fraud) costing New York consumers and insurers hundreds of millions of dollars, it puts drivers at risk.
"Those who would commit this type of crime are taking advantage of the broken no-fault system and they are organized, calculating and part of a big business. In essence, the perpetrators of this crime are imposing a 'fraud tax' on honest, hard working New Yorkers by gaming the auto insurance system.
"Without the support of lawmakers, incidents of fraud will continue to increase. Responsible citizens are the victims. We urge lawmakers to enact comprehensive, meaningful no-fault insurance reform that puts citizens of New York first."