ALBANY, N.Y., April 5 – Legislation relating to motor vehicle insurance fraud from misrepresenting where a vehicle is garaged and driven has passed the New York State Assembly and has been sent to the Senate Insurance Committee.

Within the metro areas of New York State, automobile insurance is appropriately higher in comparison to rural, less populated areas of New York State, Assemblywoman Irene Gunther (D/C-Warren) said. The reason for higher rates in those areas is due to higher occurrences of accidents, theft, and damage, she explained. The practice of misrepresenting the place where an automobile is garaged or driven is a dishonest way of reducing the costs paid for insurance. Residents of areas where insurance costs are higher should not be permitted to pay lower rates for auto insurance based simply on documentation that states their motor vehicle is garaged in an area where insurance costs are lower.

This is causing an imbalance in the insurance pool of some regions in less populated areas of the state, making rates in those regions artificially higher, Gunther pointed out.

To combat these abuses, this legislation amends Section 405 of the insurance law and requires a report to the governor and Legislature that includes the incidence of misrepresentation by insureds of the principal place where the motor vehicles are driven and stored.

The bill in the Senate is sponsored by Senator William J. Larkin, Jr. (R/C-Orange).