MONMOUTH COUNTY - On August 15, Governor Murphy signed into law a two-bill package sponsored by Assemblywoman Joann Downey that will enable drivers who choose low thresholds of personal injury protection (PIP) to sue for uncompensated medical bills and seek unreimbursed medical expenses as an economic loss.
“Many people who purchase auto insurance with lower personal injury protection do so because they can’t afford the premiums for higher levels of PIP. They don’t realize that under New Jersey’s ‘no-fault law,’ they’ll be unable to sue for medical expenses beyond the lower limit PIP option of $15,000,” said Downey (D-Monmouth). “Under these two new laws, injured drivers will now be able to recover those uncompensated medical expenses through civil action.”
The first law (A-5371) allows someone injured in a motor vehicle accident to recover all unreimbursed medical expenses not covered by the PIP limits applicable to and sustained by the injured party, as part of the recovery of uncompensated economic loss. The second law (A-5639) subjects reimbursed medical expenses resulting from accidents occurring on or after August 1, 2019, in excess of the PIP limits to the Automobile Medical Fee Schedules, and prohibits balance billing of any medical expenses claimed as damages and paid pursuant to the medical fee schedule.
New Jersey’s standard default plan for drivers is to have $250,000 in PIP coverage. The state, however, also allows drivers to purchase a cheaper insurance option and select a plan that comes with only $15,000 of personal injury protection.
Downey introduced the bills in May in response to a March State Supreme Court ruling in the case of Haines v. Taft. The high court ruled that any person whose auto policy has less than the standard $250,000 medical benefits limit has to pay for their medical treatment above $15,000 up to $250,000 and cannot sue to recover the difference.
“The Supreme Court ruling was devastating to low-income people who can't afford to buy auto policies with higher coverage limits,” Downey added. “People shouldn't be stuck with thousands of dollars in medical bills and mounting credit problems - even bankruptcy - just because they couldn't afford higher premiums for higher PIP limits. They must have some recourse.”