The New York State Department of Financial Services published an update on Governor Kathy Hochul’s auto insurance reform package, citing a Metropolitan Transportation Authority analysis that the proposal would deliver USD 48 million in recurring annual savings for the MTA by reducing exposure to large settlements in crashes where MTA buses are not primarily at fault. Under the proposal, all savings retained by the MTA are intended to be redirected over time to support subway, bus and rail operations, alongside safety and infrastructure investments. The same reforms are projected to save up to USD 25 million annually across more than 130 transit agencies outside the MTA region. The package would modernize New York’s auto liability framework by limiting disproportionate responsibility in damage awards and includes measures to create new legal liability for staged-accident fraud, restrict “windfall” payments to people committing crimes or driving uninsured, prevent at-fault drivers from suing victims, tighten the definition of “serious injury” for non-economic damages, adjust liability outcomes for parties minimally responsible for an accident, require insurers to return excess profits above a “reasonable threshold” to policyholders while justifying rate increases to consumers and regulators, and mandate technology discounts intended to incentivize safe driving. The reforms are included in the FY 2027 Executive Budget and will be considered by the New York State Legislature as part of the budget process ahead of the April 1 deadline.
New York State Department of Financial Services 2026-03-13
New York State Department of Financial Services highlights Governor Hochul auto insurance reforms projecting USD 48 million annual savings for the MTA
The New York State Department of Financial Services updated Governor Kathy Hochul’s auto insurance reform package, projected to save the Metropolitan Transportation Authority USD 48 million annually by reducing liability in certain crash settlements. The reforms modernize New York’s auto liability framework, addressing staged-accident fraud and disproportionate damage awards, while mandating insurer accountability and incentivizing safe driving. The package is part of the FY 2027 Executive Budget under consideration by the New York State Legislature.