Daily News from New York, New York • 661

JL MJ 1 Wednesday, November 29, 1989 'Cheap' HJ draivs fafies Auto insurance rates in New Jersey may be among the nation's highest, but a state indictment Tuesday alleges that 10 out-of-state residents sought coverage here ille gally. The indictment charges two New York City motorists and eight Pennsylvania residents with falsifying insurance applications in order to get car insurance from the state Joint Underwriting Association. Insurance Commissioner Kenneth Merin said a policy costing $1,500 under the JUA in New Jersey can run as high as $5,000 in New York City or Philadelphia for similar coverage by an insurance company from those states. Louis Parisi, who heads the fraud unit for the state Department of Insurance, said the indictments are just the tip of the problem. Another 15,000 to 20,000 motorists are driving with fraudulently obtained insurance, he said.

He said most of the cases involve out-of-state residents who falsely give New Jersey addresses, often a post office box or a vacant or nonexistent property. Many others involve New Jersey residents who live in urban areas, where insurance is costly, and give rural addresses, or drivers of commercial vehicles who claim they use the vehicle only for pleasure purpose. Parisi and Merin said the problem costs New Jersey drivers in the form of higher overall rates. They say it points to the need for legislation, now awaiting Assembly action, that would give the state the power to fine those who falsify their addresses. "Rate evaders are typically from high-risk areas such as Center City Philadelphia and New York City," said.

set in a pedestrian park, across from Grand Central Terminal at 42d St. Bt so ilfefeD Merin. "Individuals who obtain coverage to which they are not entitled hurt all New Jersey drivers because they reside and drive in high-risk areas, creating the potential for more claims and higher losses to the state's insurance system," he said. None of the 10 accused Tuesday of falsifying their insurance applications could be reached for comment The indictment charges that they applied for and received coverage from the JUA, a state-backed insurer that covers about half the drivers in the state and is staggering beneath a $3 billion deficit Legislation before the Assembly would give the state the power to fine motorists $5,000 the first time they falsify an insurance application. The fine would increase to $10,000 for second offenses and $15,000 for third offenses.

Parisi said such fraud can be profitable. He said it would cost a Vineland resident about $1,600 to get basic coverage for a 1988 Pontiac Firebird, but $5,800 for the same car in Philadelphia and $2,600 in Manhattan. Likewise, he said, noncommercial insurance for a 1989 Dodge van would cost $935 in Ocean and Monmouth counties and about $1,300 in Essex and Hudson counties. But for commercial insurance covering the same vehicle, the cost would rise to $1,200 in Monmouth and Ocean counties, and $2,200 in Essex and Hudson counties. Parisi said the state and insurance firms are constantly flagging policies suspected of being falsely filed, but that the list grows longer every day and without a deterrent in the law it will keep growing.

Jo Astrid Glading Tit Associated Press RENDERING OF glass-walled cafe, and Park Ave. By JOAN SHEPARD Manhattan Cultural Affairs Editor I The Landmarks Preservation Commission yesterday heard an unusual proposal to convert the bottom stone portion of the Pershing Square Viaduct between 41st St. and 42d St. at Park Ave. into a restaurant The proposal also calls for the closing of a city block between 41st and 42d St on Park restricting all except emergency vehicles and converting the area to a pedestrian mall.

The proposal was presented by the Department of General Services which operates the viaduct. The Grand Central Partnership would fund and operate the mall and restaurant. "The idea is to clean up the area," explained Dan Bieder-man, spokesman for the Grand Central Partnership. "We suggest a restaurant in order to get activity into the area after five o'clock. Increased activity means greater public safety." If approved, the proposal would mean the existing discount store at 42d St.

and Park Ave. would close. The store operates on a month-to-month lease, according to Biederman. The proposed restaurant would be in the space of the existing twnn Biederman said Part- mm In the Grand Central district, businesses are assessed about nine cents per square foot. "We have 500 retail stores and about 6,500 commercial tenants, and we raise about $4.7 million a year," explained Biederman.

The Landmarks Commission also heard a proposal from the Metropolitan Museum, which wants to add an entrance to the museum from the Central Park side of the building and to add two new restaurants. The new park entrance would lead directly into the Henry R. Kravis Wing. Kravis is known as the "King of LBOs (leveraged buyouts)" and is a partner in the Wall Street firm, Kolhberg Kravis Roberts Co, the investment firm which organized the $26 billion RJR Nabisco buyout. Kravis is a major donor to the museum.

The proposal calls for a 5000-square-foot glass roofed cafe which would seat 240 and a cafeteria. The plan, according a museum spokesman, is to take the restaurants out of the gallery area and free about 12,000 square feet for the exhibition of art work. The museum's plan does not take away from park space, according to the Parks Department The commission is re- quired to vote within-90 days on nTesS. ffn about $7 million to the city to renovate this lower portion of the viaduct and to build the restaurant. The Partnership, according to Biederman, is also talking to the operators of the airport buses which load and unload passengers at 42d St.

and Park Ave. about relocating. If the proposal is approved by the commission, Biederman said he hopes construction would begin in about a year. However, the Pershing Square proposal also requires approval by the Art Commission, the General Services Administration, and the Board of Estimate in addition to the Landmarks Commission before construction can begin. Lease sought The Partnership and the General Services Administration are also working out a lease agreement for the property.

Biederman said that because the approvals take so long, they decided to get started at the Landmarks Commission even though the lease was not finalized. The Grand Central Partnership administrates the Grand Central Business Improvement District from 38th St to 48th St from Fifth Ave. to Second Ave. Under state law businesses in an improvement district can be assessed beyond real estate taxesin ordef) it raise cash TtO'm-K nrnvo the nroa insurer was established by the Legislature at a time when commercial insurers were unwilling to provide medical malpractice coverage. Hospitals that were insured by the association will pay a 3.75 surcharge.

Physicians, surgeons, podiatrists and HMOs that were covered by the association will be levied a 5 annual surcharge. All other hospitals, HMOs, physicians, surgeons and podiatrists who are in practice but were never insured by the association will pay a 2.5 surcharge. Officials said the surcharge will remain in effect for seven years and raise about $9.1 lion each Health charge -All physicians, surgeons, podiatrists, hospitals and health maintenance organizations in New Jersey will pay a surcharge on their medical malpractice insurance -premiums to help pay off a deficit, officials say. The New Jersey Medical Malpractice Reinsurance Association, which operated between 1976 and 1982, has amassed a $64 million deficit and continues to pay out old claims as they are reached. State insurance officials said the association's deficit is the result of insufficient premium levels during the seven years it operated- The I I.