LODI, New Jersey — Attorney Peter N. Davis, Founder of The Law Offices of Peter N. Davis & Associates, LLC, which has been serving clients since 1989, applauds the passage of auto insurance laws that protect the state’s motorists.
On August 5, 2022, Governor Phil Murphy signed Senate Bill 481 into law, which took effect on January 1, 2023 and increased New Jersey’s minimum car insurance coverage requirements as follows:
- Bodily Injury Liability – $25,000 per person and $50,000 per accident
- Property Damage Liability – $25,000 per accident
- Personal Injury Protection (PIP) – $15,000
- Uninsured/Underinsured Motorist Bodily Injury – $25,000 per person and $50,000 per accident
The changes comprise the first phase of a two-phase update to the state’s auto insurance mandates. The second phase will take effect in January of 2026, when the minimums will increase again to $35,000 per person and $70,000 per accident for bodily injury liability and $35,000 per person and $70,000 per accident for uninsured/underinsured motorist insurance. Because the state operates under a no-fault insurance system, motorists must carry PIP to cover medical expenses, regardless of who caused the accident.
For New Jersey drivers, the state requires drivers to make proof of insurance available at all times by keeping it in their vehicles and showing it to law enforcement when requested. Both electronic ID cards and physical documentation are acceptable forms of proof of insurance coverage. Refusal to carry an auto insurance policy is illegal in the state, which means that uninsured New Jersey drivers are violating the law and facing stiff financial fines and penalties such as suspension of their driver’s licenses.
These updates to the state’s auto insurance laws seek to protect drivers financially and make sure that all motorists on the state’s roads and highways have enough coverage. New Jersey drivers must understand and comply with these regulations to avoid fines and penalties and protect themselves in the unfortunate event of an accident.
Under The Automobile Insurance Cost Reduction Act, all drivers have the right to auto insurance. Drivers who are denied standard coverage or cannot afford it, can choose a Basic Policy, which offers less protection at a lower cost than the Standard Auto Insurance Policy. Under a Basic Policy, Bodily Injury Liability is not included, but motorists can opt for $10,000 coverage for all persons per accident. Property Damage Liability is limited to $5,000 per accident, with PIP at $15,000 per person per accident, up to $250,000 for specific injuries, including permanent or significant brain injury, spinal cord injury or disfigurement, or for medically necessary treatment of other permanent or significant injuries addressed at a trauma center or acute care hospital in the immediate aftermath of an accident. Residents on federal Medicaid with hospitalization benefits qualify for the Special Automobile Insurance Policy (SAIP) for $365 a year. Mr. Davis recommends that his client’s not buy Basic or Dollar Per Day policies. His reasoning is that they do not adequately protect you or your family. His recommendation is that at a minimum his client’s purchase 100/300 in liability 100/300 UM/UIM.
Previously, on July 22, 2021, thanks to Governor Murphy, New Jersey also became a disclosure state relative to insurance. Before the passage of this law, it was difficult for personal injury attorneys to negotiate cases pre-suit because insurance companies didn’t have to tell them what the policy limits were.
“You were always in the dark, which was a big advantage for the insurance carrier negotiating in pre-litigation,” Davis said. “Now, once you make the request for the limits, they have to tell you.” The new law levels the playing field when trying to settle a case. Buying auto insurance online also creates a problem because it cuts brokers out of the equation. Brokers have a fiduciary duty to their customers. They have to do what’s in the best interest of the people buying insurance from them. When you buy a policy online you’re buying it directly from the insurance carrier, they have no fiduciary duty. It’s an arms’ length transaction to let the buyer beware.
On January 18, 2022, Governor Murphy signed into law the New Jersey Insurance Fair Conduct Act (IFCA). Under this law, policyholders injured in a motor vehicle accident can file suit against their automobile insurance company for “an unreasonable delay or unreasonable denial” of their claims. It basically means that New Jersey policyholders can sue their insurance company for acting in bad faith. The IFCA applies to uninsured motorist (“UM”) or underinsured motorist (“UIM”) coverage.
“The new laws are a good thing for New Jersey drivers.”
For more information, visit The Law Offices of Peter N. Davis & Associates, LLC.
About The Law Offices of Peter N. Davis & Associates, LLC
Attorney Peter N. Davis founded Peter N. Davis and Associates in 1989. Since then, Attorney Davis and our dedicated team have served countless injured individuals and their families in Lodi, New Jersey, and surrounding communities.
We have settled over $400 million dollars since 1989, we have also helped thousands of clients navigate the difficult legal system to get the money they truly deservedto recover from their accidents.
We are fierce advocates for those who have suffered injuries due to the carelessness of another person or entity and are proud to fight for justice and compensation for our clients.
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