NYC’s Largest Cab Insurer Ordered to Explore Sale After Losses

The report laid out dozens of potential financial improprieties and accounting problems at the city’s largest insurer of taxis and for-hire vehicles, and warned that the consequences of the company’s failure could be devastating for tens of thousands of drivers.

The insurer known as ATIC has had reserves that are “massively deficient,” according to a letter from New York’s Department of Financial Services dated April 3 that was posted to the DFS website. ATIC must take “immediate action” to cure its insolvency and should “explore all possible options to obtain funding,” according to the letter.

“If this situation is not resolved, ATIC is at significant risk of failure,” the letter warned. “This would be economically devastating for livery drivers, passengers, health care providers and the New York economy, and would disrupt vital transportation services,” DFS said.

ATIC said in a statement Thursday that the company is working to address a “longstanding issue of statutory solvency amid rampant fraud and escalating costs.” The company said it’s seeking a solution, which will “not unduly impact the broader market in an adverse manner.”

The documents showed years of previously unpublished correspondence and comprehensive state-mandated examinations that made clear ATIC’s dire financial circumstances. The report raises questions over how regulators under current Governor Kathy Hochul and her predecessor Andrew Cuomo failed to take serious action that would force the company to address its problems until recent months.

DFS said in a statement that under Hochul and current Superintendent Adrienne Harris the department is publishing the exam reports “for the first time in nearly 40 years,” and said it “took time to untangle the complex issues and history.”