Exploring the Increased Auto Insurance Costs for New Yorkers

In 2024, New York households faced an average personal auto insurance cost of $1,935, marking a significant increase from $1,753 in 2023. This rise highlights the growing financial burden on residents, as reported by the Insurance Information Institute (Triple I).

According to Triple I, New Yorkers allocated approximately 2.23% of the state’s median household income to personal auto insurance in 2024, up from 2.15% the previous year. In contrast, the national average stood at just 1.59%. This places New York as the fourth highest state for auto insurance costs in 2023, trailing only Louisiana, Florida, and Mississippi.

The report titled New York Personal Auto Insurance Premium and Cost Drivers comes in the wake of Governor Kathy Hochul’s commitment to prioritize making auto insurance more affordable in her administration’s 2026 legislative agenda.

Triple I has identified several key cost drivers that need addressing to enhance affordability: elevated repair costs, severe injury claims, high claims-handling expenses, and the frequency of accidents. “By tackling these cost drivers, New Yorkers could see meaningful steps toward improving long-term insurance affordability,” stated Michel Léonard, chief economist and data scientist at Triple I.

In her 2026 State of the State address, Hochul emphasized the need to combat fraud, including staged accidents that contribute to the soaring average auto insurance premiums of $4,000 per year—$1,500 more than the national average. She proposed reforms to the serious injury threshold under the state’s no-fault insurance law, aimed at reducing litigation. Additional measures include capping non-economic damages for drivers engaged in criminal behavior at the time of the accident and allowing insurers more time to investigate suspected fraudulent claims.

Hochul asserted that New Yorkers “should not pay more for the same coverage” and expressed determination to address this issue in the current year.

Trial Lawyers

However, Hochul’s proposals may encounter significant opposition from the state’s influential trial lawyers. The New York State Trial Lawyers Association (NYSTLA) has labeled these proposals a “victim tax” and a “disaster for crash victims’ rights.” They argue that the changes would hinder injured residents from obtaining claim payments and that any potential cost reductions would not be passed on to policyholders.

On the other hand, a new advocate for reform has emerged. Supported by Uber, the Citizens for Affordable Rates (CAR) is pushing for lower insurance costs across auto, home, and health insurance, citing these expenses as a growing burden for families and businesses. The group aims to tackle fraud and excessive litigation as part of its strategy to reduce costs.

Affordability Trend

The Triple I report follows an April 2025 analysis from the Insurance Research Council, which found that auto insurance has become more affordable compared to the early 21st century. The IRC noted that the average expenditure as a share of income was 1.64% in 2000, despite the average cost of auto insurance being only $690.

Throughout the 2000s, auto insurance expenditures averaged 1.7%, while the 2010s saw a slight decrease to 1.6%. However, the IRC anticipates a decline in affordability for 2023 and 2024 due to recent rate hikes.

Topics
Auto

In 2024, New York households faced an average personal auto insurance cost of $1,935, marking a significant increase from $1,753 in 2023. This rise highlights the growing financial burden on residents, as reported by the Insurance Information Institute (Triple I).

According to Triple I, New Yorkers allocated approximately 2.23% of the state’s median household income to personal auto insurance in 2024, up from 2.15% the previous year. In contrast, the national average stood at just 1.59%. This places New York as the fourth highest state for auto insurance costs in 2023, trailing only Louisiana, Florida, and Mississippi.

The report titled New York Personal Auto Insurance Premium and Cost Drivers comes in the wake of Governor Kathy Hochul’s commitment to prioritize making auto insurance more affordable in her administration’s 2026 legislative agenda.

Triple I has identified several key cost drivers that need addressing to enhance affordability: elevated repair costs, severe injury claims, high claims-handling expenses, and the frequency of accidents. “By tackling these cost drivers, New Yorkers could see meaningful steps toward improving long-term insurance affordability,” stated Michel Léonard, chief economist and data scientist at Triple I.

In her 2026 State of the State address, Hochul emphasized the need to combat fraud, including staged accidents that contribute to the soaring average auto insurance premiums of $4,000 per year—$1,500 more than the national average. She proposed reforms to the serious injury threshold under the state’s no-fault insurance law, aimed at reducing litigation. Additional measures include capping non-economic damages for drivers engaged in criminal behavior at the time of the accident and allowing insurers more time to investigate suspected fraudulent claims.

Hochul asserted that New Yorkers “should not pay more for the same coverage” and expressed determination to address this issue in the current year.

Trial Lawyers

However, Hochul’s proposals may encounter significant opposition from the state’s influential trial lawyers. The New York State Trial Lawyers Association (NYSTLA) has labeled these proposals a “victim tax” and a “disaster for crash victims’ rights.” They argue that the changes would hinder injured residents from obtaining claim payments and that any potential cost reductions would not be passed on to policyholders.

On the other hand, a new advocate for reform has emerged. Supported by Uber, the Citizens for Affordable Rates (CAR) is pushing for lower insurance costs across auto, home, and health insurance, citing these expenses as a growing burden for families and businesses. The group aims to tackle fraud and excessive litigation as part of its strategy to reduce costs.

Affordability Trend

The Triple I report follows an April 2025 analysis from the Insurance Research Council, which found that auto insurance has become more affordable compared to the early 21st century. The IRC noted that the average expenditure as a share of income was 1.64% in 2000, despite the average cost of auto insurance being only $690.

Throughout the 2000s, auto insurance expenditures averaged 1.7%, while the 2010s saw a slight decrease to 1.6%. However, the IRC anticipates a decline in affordability for 2023 and 2024 due to recent rate hikes.

Topics
Auto