Car insurance personal injury protection claim losses tied to medical expenses, lost wages and other costs related to auto accident injuries in the New York City area were 70 percent higher last year than in 2000, according to a new Insurance Research Council study of personal injury claims in the state.
The rise in claims surpassed the 49 percent increase in medical care inflation over the same period.
The average PIP claim in the New York City metro area was more than double the average in the rest of the state--$15,086 compared to $6,870. Car insurance customers in the metropolitan area were much more likely to visit chiropractors, physical therapists and acupuncturists. They also were more likely to receive expensive diagnostic procedures, report durable medical equipment expenses, receive treatment in pain clinics and hire attorneys, the report says.
Statewide, about 23 percent of claims involved the appearance of fraud, material misrepresentation of the facts, or inflated medical or other expenses in an otherwise legitimate claim.
Thirty-five percent of claims in the New York City metro area involved instances of apparent claim abuse. That compares to just 8 percent of claims involving apparent abuse in the rest of the state. More than half (52 percent) of the examples of apparent claim abuse in New York City stemmed from accidents occurring in either Brooklyn or Queens. The two boroughs accounted for only 28 percent of all claims in the study.
"This report further details the problem of claim abuse in New York, especially unscrupulous medical providers who overtreat and overcharge claimants and their insurers," Elizabeth Sprinkel, the council's senior vice president, said in a press statement. "Even when the excessive charges can be mitigated, the costs of combating these fraudulent activities are further driving up the price of insurance for all consumers in the state."
The IRC study examines details from more than 4,500 auto insurance claims closed in 2010. Ten car insurance companies, representing about 70 percent of the private passenger auto insurance market in New York, participated in the study.