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Insurance organization president says fraud in New York is a "crisis\

Posted On Wed, April 27, 2011

While no-fault insurance laws can make the claims process a lot easier for policyholders, an insurance expert says the policy is costing drivers millions in excess auto insurance payments due to so many people taking advantage of the system.

According to Robert Hartwig, president of the Insurance Information Institute, no-fault auto insurance fraud has reached epidemic levels in New York.

"The scale of fraud and abuse in New York State’s no-fault auto insurance system today remains at crisis levels," Hartwig said. "Not only are New York's courtrooms filled with no-fault cases, but an Insurance Research Council study found that over one in five of all downstate New York no-fault closed claims showed signs of fraud and more than one in three appeared to be inflated."

Hartwig has called on the New York Legislature to amend the state's no-fault auto insurance laws so that fraud and abuse trends don't continue.

According to the III, 12 states, as well as Puerto Rico, have no-fault insurance laws on the books, otherwise known as Personal Injury Protection. The National Insurance Crime Board has seen a significant increase in questionable claims recently from states with these laws.

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