NY DFS Penalizes Insurers for Late Vehicle Information Reporting
Superintendent Adrienne A. Harris of the New York Department of Financial Services (DFS) has announced the first actions taken in an ongoing investigation into the insurance industry’s failure to report vehicle information to the Department of Motor Vehicles (DMV) in a timely manner. Zurich American Insurance Company (Zurich) and Progressive Direct Insurance Company (Progressive) have agreed to pay a combined $4.2 million in fines for failing to adhere to reporting deadlines.
Under separate Consent Orders, Zurich will pay $2.2 million, and Progressive will pay $2 million. DFS initiated the investigation after becoming aware of industry-wide problems with the Insurance Information & Enforcement System (IIES) reporting. New York State law mandates that insurers report newly insured vehicles within seven days of their effective date and any insurance terminations or suspensions within 30 days.
“This reporting requirement is critical to protect New Yorkers on the road, as the requirement helps ensure drivers can rely on the availability of insurance coverage to address potential injuries and car repairs in the unfortunate event of an accident,” said Superintendent Harris. “DFS expects insurers to comply with this important regulation to uphold the integrity and accuracy of auto insurance information to the state to protect consumers.”
The DFS is working closely with the DMV, and continues to investigate potential violations across the industry. Zurich and Progressive must also provide remediation plans detailing corrective actions, subject to DMV approval.
“These consent orders are an important means of protecting consumers, and the DMV is grateful to the Department of Financial Services for taking action,” said DMV Commissioner Mark J.F. Schroeder. “Late or invalid insurance filings have a negative impact on New Yorkers, the DMV, and the insurance industry, so we work closely with insurance companies to make sure customers’ insurance information is filed with us in a timely manner. When insurance companies fail to comply, they put all New Yorkers at risk.”
The DFS has acknowledged cooperation from Zurich and Progressive, as they became the first insurers to reach settlements. The department continues active investigation into other violations, coordinating with the DMV and other insurance companies to bring the entire New York insurance segment into compliance.
