Automobile Insurance Coverage
What Is the Best Coverage for Me and My Family?
You and your family are involved in an automobile accident that is not your fault. You, your spouse and two children are taken to the emergency room by ambulance. After initial X-Rays are taken, and an examination is made by the physician, you are diagnosed with neck and back sprains. Your spouse has a severely bruised shoulder and three non-displaced, cracked ribs. Your oldest child has a severe concussion and is hospitalized for observation, and your son was just shaken up.
You want the person who caused this accident and his insurance company to pay for your medical bills and for the pain and suffering of you and your family. Unfortunately, you are entitled only to monetary compensation for the injuries sustained in this accident if your own automobile insurance policy provides for a “No Limitation on Lawsuit” threshold. The vast majority of New Jersey drivers, however; have opted to severely restrict their rights to be compensated for their pain and suffering by selecting the “Limitation on Lawsuit” threshold option. This means that you could be saddled with hundreds, if not thousands, of dollars in medical bills not payable by your own insurance company because they are subject to the deductible and co-payment provision of your policy.
You ask for clarification. Do you mean that we are not entitled to any payment for our pain and suffering and we must pay medical bills incurred for an accident that was not our fault? The answer is yes.
How do you avoid such an apparent injustice? By changing your automobile insurance policy to the “No Limitation on Lawsuit” threshold. Of course, before making this selection, you should spend some time doing a cost benefit analysis. While the “Limitation on Lawsuit” Threshold option is a substantially cheaper choice (approximately $500 per year, per car – with some insurance carriers charging a little more, some a little less), it also provides far less coverage than the “No Limitation on Lawsuit” threshold.
Keep in mind, too that one’s selection of coverage binds your spouse and children regardless of whose car an individual is occupying at the time of an accident. For example, if your daughter is riding in a neighbor’s car when an accident occurs, your household’s automobile insurance coverage determines if a claim can be brought for her injuries.
In a nutshell, the “Limitation on Lawsuit” option severely limits your legal rights and the rights of your family members to pursue a claim for monetary damages or to file a lawsuit against a careless driver, unless, under the provisions of N.J.S.A. 39:6A-8, you sustain one of the following types of injuries:
- Significant disfigurement or scarring.
- Displaced fractures.
- Loss of a fetus.
- Permanent injury (defined as when a body part has not and will not heal to function normally with further treatment and confirmed by diagnostic testing).
Last year, over 90% of the people who had chosen the “Limitation on Lawsuit” option and who went before a New Jersey jury seeking compensation for the injuries they sustained received no money, regardless of if the other driver caused the crash.
By knowing the differences between these two basic types of automobile insurance policies in New Jersey, you can today make an informed decision. There is no correct or incorrect answer. The decision must be one that is right for you and your family. Please contact us 856-637-3000 in the event you need legal advice involving motor vehicle accidents and the amount of insurance protection your policy provides.
– Joseph J. Hoffman, Jr.