New York Changing What Insurance Companies Do To Your Rates

Tired of seeing your car insurance bill go up? New York is changing the rules insurers must follow before raising your rates.

New York drivers should soon have more protection against surprise car insurance rate hikes.

New York Is Making It Harder For Car Insurance Companies To Raise Your Rates

If your car insurance bill has been climbing and you've had no idea why, a new state regulation coming this fall is designed to put a stop to that.

Governor Hochul's administration has proposed a new rule requiring auto insurance companies to get express approval from New York State before raising rates on private passenger vehicles.

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The regulation takes effect November 27. It closes a loophole that major carriers like GEICO, Progressive, and Allstate have been using for years to quietly raise your premiums without anyone signing off on it.

“New Yorkers deserve a transparent, fair, and accountable auto insurance market that puts customers first,” Gov. Kathy Hochul said.

Under the old system, insurers could raise rates to two times per year without state permission, as long as the total increase stayed under five percent.

It's flex-rating. Which means companies could bump your bill without any independent review and without having to explain themselves to anyone.

Starting in late November, every proposed rate increase, even a one percent bump, now requires insurers to submit their data to the New York State Department of Financial Services and wait for approval before a single dollar gets added to your bill.

“New Yorkers deserve relief from rising auto insurance costs, as well as greater transparency and accountability when rates change. Requiring insurers to receive prior approval before raising private passenger auto rates is an important consumer protection," Assemblymember David Weprin said.

Rate decreases are a different story. Companies can still lower rates by up to five percent without prior approval.

The state wants insurers to be able to pass savings to drivers quickly, without delay.

"As we continue to work to lower costs, combat fraud and make New York State more affordable, we are helping families and businesses make informed decisions and ensuring insurers remain accountable to their customers," Hochul added.

A 60-day public comment period is currently underway following the rule's publication in the State Register, giving New Yorkers a chance to weigh in before it becomes official.