Auto Insurance Repair Surcharge Threshold Increased in N.Y.

New York Governor David PatersonA bill signed this past weekend by New York Gov. David Paterson increases the property damage threshold that must be reached before auto insurance companies can apply a surcharge.

Property damage in a claim must now exceed $2,000, up from the $1,000 threshold established in 1991, for insurers to be able to tack on the extra fee.

Professional Insurance Agents of New York (PIANY) say that the threshold increase was needed due to inflation alone.

“The threshold, which has not been raised in nearly 20 years, has saddled drivers with surcharges on almost every car accident, even minor fender-benders, since they are almost always likely to cost more than $1,000 to repair damages,” said PIANY president Kevin Ryan in a statement.

Research from the Insurance Institute for Highway Safety conducted in 2008 shows that even economical small cars could have large repair costs. The Institute found that, even in a low-speed accident, cars such as the Hyundai Elantra and Toyota Prius had bumper damage potentially costing upward of $4,000 to repair.

About Ben Zitney
Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.

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