What Insurance Issues Affect my Car Accident Case in New Jersey?

By Greg Kohn

When a person is injured in a car accident in New Jersey, one of the first steps after seeking medical attention is to file an insurance claim. An insurance claim can provide compensation for medical bills, lost income, and other damages. However, New Jersey car insurance requirements can have a significant impact on a victim’s ability to recover full compensation for all damages.

If you have questions about the compensation you may be entitled to receive after a car crash, a New Jersey car accident attorney can review your case to determine what insurance issues could impact your ability to receive a fair settlement for your injury claim.

Basic vs. Standard Car Insurance Coverage in New Jersey?

Drivers may choose between a basic insurance policy or a standard insurance policy, but the choice of insurance coverage has a significant impact on a person’s ability to pursue an at-fault driver for damages arising from a car accident.

A basic insurance policy provides the following insurance coverage:

  • $5,000 property damage coverage
  • $15,000 Personal Injury Protection (PIP) coverage
  • $250,000 PIP coverage for significant or permanent injuries

Liability insurance is not included in a basic policy, but $10,000 in coverage may be added as an option.

A standard insurance policy provides the following insurance coverage:

  • Minimum bodily injury liability coverage of $15,000/$30,000
  • Minimum property damage liability coverage of $5,000
  • Minimum of $15,000 PIP coverage ($250,000 for significant injuries)

Individuals may choose to purchase higher amounts of insurance coverage with a standard insurance policy. They may also purchase uninsured and underinsured coverage up to the amounts selected for their liability coverage.

New Jersey’s No-Fault Car Insurance System

New Jersey is a choice no-fault insurance state. In a no-fault system, PIP coverage pays for your medical care and lost income. Your choice of a car insurance policy sets the coverage and terms. The insurance coverage applies regardless of whether you or the other driver was responsible for causing the car crash. Therefore, accident victims file claims under their PIP coverage before they pursue a claim against the other driver.

However, your PIP coverage may not cover all your damages and costs from a car accident. In that case, you may have the right to pursue a claim against the driver who caused the accident depending on the type of car insurance coverage you purchased.

Limited Right to Sue vs. Unlimited Right to Sue

When you purchase car insurance coverage in New Jersey, you must choose between a limited or unlimited right to sue option. All basic insurance policies have the limited right to sue option. Standard insurance policies may be purchased with either option.

The limited right to sue option lowers your insurance premium but restricts your right to sue the other driver for pain and suffering damages. You may sue an at-fault driver for economic damages if your financial losses exceed your PIP coverage. However, you cannot sue the at-fault driver for pain and suffering or noneconomic damages unless one of six circumstances apply:

  • Dismemberment
  • Death
  • Loss of fetus
  • Displaced fracture
  • Significant scarring or disfigurement
  • Certain permanent injuries

If you choose a standard insurance policy with an unlimited right to sue option, your right to pursue a claim against an at-fault driver is not limited. Because noneconomic damages can be a substantial portion of an injury claim, choosing a car insurance policy with a limited right to sue can severely lower the amount of money you might be entitled to receive for a car accident claim.

Consult a New Jersey Car Accident Attorney for More Information

Determining your legal options for recovering compensation after a car accident can be difficult, especially if you chose a policy with the limited right to sue option. A New Jersey personal injury attorney can evaluate your claim to determine if your injuries fall within one of the six categories that allow for noneconomic damages. Before settling your claim, it is beneficial to discuss your case with an experienced attorney to ensure you are receiving all compensation you deserve under New Jersey’s personal injury laws. Contact Nagel Rice today for a free consultation.

About the Author
Greg Kohn is a partner at Nagel Rice and specializes in complex civil litigation cases, including professional malpractice, personal injury, class actions, wrongful death, products liability, and commercial litigation.  He has extensive experience representing clients in both state and federal court. Greg has tried many jury trials to verdict and has recovered over $50 million in settlements and verdicts in all types of personal injury matters including automobile accidents, wrongful death cases, slip and falls, and other catastrophic injury cases. Greg also handles medical malpractice cases, involving misdiagnoses, wrongful birth, and delayed cancer diagnosis. If you have questions regarding this article, you can contact Greg here.