From Brooklyn pizzerias to Bronx medical clinics, New York’s small business owners are raising the alarm: high rents aren’t the only costs threatening their survival. A coalition of more than 30 neighborhood businesses is backing Governor Kathy Hochul’s proposal to overhaul the state’s auto insurance system, warning that soaring premiums have become an existential threat to the “backbone” of the state’s economy.
In a letter to legislative leaders, these local employers stressed that the proposed reforms are about more than cost-cutting for insurers—they are designed to put money back into the pockets of drivers and business owners who have been overpaying for years.
Targeting Real Relief for Drivers and Businesses
The plan aims to lower auto insurance costs by cracking down on fraud, limiting payouts for drivers engaging in unlawful behavior, and modernizing litigation rules. Importantly, it calls for a review of the state’s Excess Profit Law to ensure that savings from these reforms benefit consumers before reaching insurers.
For contractors in Deer Park or delivery drivers navigating Jackson Heights, a vehicle is not a luxury—it’s essential for earning a living. Yet many commercial premiums have surged 50% to 100% since 2021, according to the coalition. Experts attribute the increases to rampant motor vehicle insurance fraud, which has jumped roughly 80% over the past five years, adding an estimated $300 in hidden costs to each driver’s annual bill.
High Costs Threaten New Yorkers’ Bottom Line
The average full-coverage premium in New York now reaches $4,031 per year—nearly double the national average. Governor Hochul’s reform plan targets the root causes of these high costs:
- Cracking Down on Fraud Rings: Empowering district attorneys and state police to dismantle organized fraud operations.
- Closing Legal Loopholes: Extending investigation periods for suspicious claims and capping large payouts for impaired or criminal drivers.
- Returning Profits to Drivers: Redirecting insurance companies’ excess profits back to New Yorkers who power the state’s economy.
A United Front of Local Businesses
The coalition includes a diverse range of small businesses, all arguing that they are being punished for hard work while professional fraudsters reap the benefits.
“Whether it’s a delivery van in Flushing or a service vehicle in the Bronx, our economic growth is being crushed.”
As state budget negotiations continue, these 31 businesses are urging lawmakers to address the auto insurance crisis with urgency. For many of the shops that survived the pandemic, the message is clear: they cannot afford to be driven off the road by a broken system.
