FOR IMMEDIATE RELEASE
May 11, 2006
MAYOR BLOOMBERG SIGNS LEGISLATION FIGHTING AUTO INSURANCE FRAUD
Remarks by Mayor Michael R. Bloomberg at a Public Hearing on Local Laws
"The next bill before me is Introductory Number 243-A, sponsored, at the request of Brooklyn Borough President, Marty Markowitz, by Council Members Yassky, Brewer, Nelson, Barron, Fidler, Koppell, Recchia, Gentile, Felder, Garodnick, Gennaro and Weprin. This bill further combats no-fault automobile insurance fraud by prohibiting the employment of 'runners' in New York City.
"New York State mandates no-fault insurance coverage for all motor vehicles. This no-fault system lowers insurance rates and is designed to promptly pay up to $50,000 for medical treatment for injuries resulting from an automobile accident, regardless of the driver's fault or negligence. Unfortunately, insurance rates have increased after the no-fault law went into effect, and fraud is one of the main causes of this increase.
"Introductory Number 243-A attempts to combat a specific type of fraud with no-fault medical providers. Some medical clinics are established for the purpose of defrauding insurance providers. The owners of these fraudulent clinics hire 'runners' to recruit actual or fraudulent accident victims by canvassing hospitals or roadways for legitimate automobile accidents, and at times stage accidents for fraudulent purposes. Introductory Number 243-A prohibits 'runners' and also requires medical clinics processing a high volume of no-fault insurance claims to report their activity to the Department of Consumer Affairs. Any clinic found to be hiring 'runners' or not reporting their activity to the Department of Consumer Affairs will be subject to civil penalties.
"I would like to thank Department of Consumer Affairs Commissioner Jonathan Mintz and his staff for their work on this bill. I would also like to thank Brooklyn Borough President Marty Markowitz for his leadership on this important issue. Finally, I would like to thank the members of the City Council, particularly the bills sponsors, for passing this legislation."
Stu Loeser / Jordan Barowitz (212) 788-2958