In no-fault insurance states like New Jersey, your own insurance coverage is the primary insurer, regardless of fault for the accident. In other words, if you’re in a car accident – whether you’re on a congested street in Jersey City or driving the Garden State Parkway in Hackensack  – your own insurance coverage choices will determine how much you are able to recover in compensation after an accident. In this blog post, we’ll cover New Jersey auto insurance PIP options.

Liability in a New Jersey Car Accident

Many New Jersey drivers believe that whomever is at-fault for a car accident will be responsible for compensating the other for any damage or injury caused. However, this is not necessarily the case. In no-fault insurance states, your own insurance coverage is the primary insurer, regardless of fault for the accident. In other words, your own insurance coverage will cover property damage and pay for some expenses related to injuries stemming from the accident.

Filing a claim against another driver – assuming the driver is at-fault for the accident – is only possible if you have certain types of PIP auto insurance coverage in New Jersey.

Basic vs Standard PIP Options in New Jersey

Under New Jersey’s car insurance system, drivers have the options for Basic or Standard coverage. If you’ve chosen Basic coverage, you have very limited options for recovering compensation after an accident. For this reason, we strongly advise clients against this option. While it may be less expensive, few people can afford the consequences of such low insurance coverage limits. There are very few options for suing another driver with Basic coverage. 

If you choose the Standard coverage, you would also have an option for coverage with an “Unlimited Right to Sue” (also known as “no limitation on lawsuit”) or “Limited Right to Sue.” Which type of coverage you have dictates under what circumstances you can file a claim against another driver.

Unlimited Right to Sue vs Limited Right to Sue

When choosing auto insurance PIP options, you can decide if you want to retain the right to sue in the event you are injured in a vehicle accident. This allows you to file a claim against the at-fault driver’s policy if your own PIP coverage is not enough to cover all of your losses.

Regardless of your choice, you can file a claim to recover compensation for medical expenses and lost income. This option only affects your ability to file a claim for non-economic damages, like pain and suffering. Keep in mind that if non-economic damages are awarded, they are typically a multiplier of your economic losses. 

If your car insurance has a limited right to sue or “limitation on lawsuit” policy in New Jersey, you can only file a claim for non-economic damages like pain and suffering if you have one or more specific injuries including:

• Death
• Loss of limbs or dismemberment
• Significant Disfigurement or Scarring
• Broken bones or fractures
• Loss of an unborn child
• Permanent Injury to a body part that will never heal

If you had family members in the vehicle who suffered injury in the accident, the same limitations would apply to them.

If you select the unlimited right to sue, the above list of injuries does not apply and you are free to pursue a claim against the at-fault driver regardless of a specific injury.

Uninsured/Underinsured PIP Insurance Option in New Jersey

New Jersey’s uninsured motorist coverage pays for property damage or bodily injury if you are in an accident caused by an uninsured motorist (a driver who does not have the minimum level of insurance required by law) or a driver who is insured, but who has less coverage than you.

If you have a Standard Policy, your auto insurance should pay for damage sustained by your vehicle caused by any of the following:

• Someone who did not have liability insurance at the time of the accident.
• A business that did not have liability insurance at the time of the crash.
• Someone who did have liability insurance at the time of the crash, but for some reason their auto insurance company refuses to cover the loss.
• Someone who had inadequate insurance coverage to pay for all of your damages.
• A business that had inadequate insurance coverage to pay for all of your damages.

If you live in New Jersey, the best way to protect yourself is by making sure you have a Standard Policy and adding Uninsured and Underinsured Motorist Coverage (UM/UIM) to your own auto policy. While your premiums may be higher, this supplementary coverage can protect your assets and well-being down the line.

New Jersey PIP Options

One of the most common questions we hear is, “how much is my claim worth?” Unfortunately, even if you are seriously injured in a car accident through no-fault of your own, your ability to recover financial compensation for your losses and maximize your claim could be hindered by your insurance coverage choices. For this reason, we recommend that drivers carry as much insurance as they can afford and retain their full rights. No one expects to be in a car accident, not to mention be left on the hook for thousands of dollars of expenses.

Help with Your Car Accident Claim

If you’ve been injured in a car accident, we strongly advise you to contact our firm and speak with an experienced car accident attorney at once. It can be hard to determine if you have a case and what your options are without consulting with an attorney. Insurance companies -- even your own -- may devalue or deny your claim. An experienced car accident lawyer can negotiate with insurance companies and handle PIP arbitration.

At Brandon J. Broderick, Attorney at Law, we believe in exceptional client care, empathy, and results. With offices in New Jersey, New York, and Connecticut, we’ve got you covered.  We have decades of experience championing for our clients and succeeding, even when insurance adjusters deny or devalue your claim. Contact us today for a free consultation.