Assembly Bill 33 is sponsored by A/M Cahill. It was referred to Insurance on 1/4/2017 and hasn’t gone anywhere since.

Current law limits the maximum amount of insurance settlements in certain cases. The schedule limiting the maximum amount is currently set by the chair of a Worker’s Compensation Board.

This law changes that process so that the maximum amount would instead be set by a Superintendent. It also directs that Superintendent to be more mindful (presumably, more supportive) of no-fault claimants.

This seems like a pretty complex issue. Philosophically, you can argue that the bill removes an artificial restriction on maximum payouts and the government should take a step out of the restriction business. On the other hand, you can argue that the bill is a carve-out of a particular sector of insurance and causes even more distortion for that reason.

On an analysis of interests, it seems like this bill would probably help, in some very small way, no-fault claimants, hospitals (doctors, nurses, etc.), and trial lawyers. It seems like the bill would probably hurt, in some small way, businesses (esp. small businesses), taxpayers (New York State is a major employer) and insurers.

The best argument against this bill is that it seems to provide concentrated benefits and diffuse harms, and that legislation like that is usually bad (e.g. farm subsidies). That’s a good general argument against a bill and I’m not sold on the necessity of this one. So, I’d vote against this bill.

I’d be open to changing my opinion if A/M Cahill could show that the current system distorts the proper compensation for no-fault tenants in a clear way, or if he could show that the bill actually does not cause diffuse harm.

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