NU Online News Service, Jan14, 2:41 p.m. EST

Insurance industry representatives presented aunified front in opposition to the New York City Fire Department'splan to impose an accident tax onmotorists.

At a hearing today, representatives from theinsurance industry expressed opposition to a plan that would allowthe city's fire department to charge motorists close to $500 whenthey answer an accident call.

After attending today's hearing, EllenMelchionni, president of The New York Insurance Association, toldNU Online News Service that she hopes the hearing served as aneducational session for the fire department and the city. She saidthere was a united front of opposition displayed at the hearing,including representatives from the Property Casualty InsurersAssociation of America (PCI) and the National Association of MutualInsurance Companies (NAMIC), among a host of others who spoke inopposition to the plan.

"I believe the information we provided for themwill enlighten them to understand that this is a bad idea and badpublic policy," said Ms. Melchionni.

Under the city's plan, there would be a chargeof $490 to respond to a vehicle fire or any other incident withinjuries. A vehicle fire without injuries would cost the motorist$415 and arriving to a scene without fire or injury would see acharge of $365.

NAMIC issued a statement outlining itsopposition to the plan that would bill motorists and insurers,saying that the fee amounts to double taxation and municipalitiesare under the false impression that the fees are covered byinsurers.

"NAMIC has fought these proposals every step ofthe way, and we continue to find that these fees are not onlyunpopular but also ineffective as a means of generating revenue,"said Paul Tetrault, NAMIC's state affairs manager for theNortheast, in a statement. "Municipal officials should recognizethe balance between potential revenues and public opposition, whichshows these programs are not worthwhile."

In a separate statement, the American InsuranceAssociation (AIA) noted the overwhelming opposition the proposalhas gotten and that in other places where these plans wereinstituted, major revenue gains were not realized.

"We believe this kind of fee-based emergencyresponse system was rejected long ago for very good reasons andshould not be resurrected now," said David F. Snyder, AIA vicepresident and associate general counsel.

Critics charge that individuals would delaycalling for emergency assistance because of the charges,endangering lives in the process.

"Even a moment's hesitation caused byfee-related financial concerns can be fatal," said Mr. Snyder.

In her testimony, Ms.Melchionni laid out the case that revenues promised under thisscheme are not often realized. In one example, the city ofCleveland billed $2 million but only collected $117,000 in oneyear. Quincy, Mass., expected to raise $25,000 in accident responsefees but only collected $2,700.

No decision was made at the hearing and Ms.Melchionni said attendees were told it would be a few weeks beforethe department makes a decision.

It has been reported that New York City CouncilPresident Christine Quinn is opposed to the plan. However, the firedepartment does not need council approval to move forward.