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Gov. Kathy Hochul’s auto insurance reform plan would generate $48 million in annual savings for the Metropolitan Transportation Authority and another $25 million for transit agencies statewide, according to a new MTA analysis announced Friday.
The proposal aims to prevent transit agencies from paying large settlements in crashes where their buses were not primarily at fault. Under current law, MTA buses have become targets for substantial payouts even when other vehicles caused accidents.
“New York’s broken insurance system is not just hurting those who rely on a car to get around, but the millions of New Yorkers who take trains and buses every day,” Hochul said. “For too long, our transit agencies have been used as a deep pocket for jackpot settlements, forced to make huge payouts even when their buses aren’t at fault for a collision.”
The MTA said it plans to redirect all savings from the reforms into operating subways, buses, and railroads. The additional $25 million would benefit more than 130 transit agencies outside the MTA region, which operate over 3,000 buses and serve hundreds of thousands of riders daily across urban, suburban, and rural communities.
MTA Chair and CEO Janno Lieber said the reform would substantially reduce the authority’s exposure to questionable lawsuits. “Every dollar saved can be redirected back where it belongs: to delivering more frequent, more reliable transit service for New Yorkers,” Lieber said.
The reform package includes seven key components: creating legal liability for those orchestrating staged accidents; preventing uninsured or criminal drivers from receiving large settlements beyond medical care and lost wages; barring at-fault parties from suing their victims; redefining what constitutes a serious injury; limiting disproportionate liability for those minimally responsible; requiring insurers to return excess profits to policyholders; and mandating technology discounts for safe driving.
New York State Department of Transportation Commissioner Marie Therese Dominguez said the reforms would allow transit providers to focus resources on serving riders instead of fighting lawsuits.
The proposal is included in Hochul’s fiscal year 2027 executive budget.
The state Legislature will consider the insurance reforms as part of the budget process ahead of the April 1 deadline.