INDIANAPOLIS (Dec. 1, 2005)—A new actuarial study concluding that a New Jersey Supreme Court ruling will substantially increase costs for drivers that choose no fault coverage shows there is a significant need for legislation to correct the decision, according to the National Association of Mutual Insurance Companies (NAMIC).
The Supreme Court’s decision in DiProspero v. Penn, 183 N.J. 477 (2005) will increase bodily injury and uninsured/underinsured motorists costs for drivers selecting the verbal threshold option by between 36-57 percent, estimates Pinnacle Actuarial Resources, Inc., which conducted the study on behalf of the Save Choices for New Jersey Drivers Coalition. Approximately 92 percent of New Jersey drivers have chosen the verbal threshold no fault option.
“Drivers have chosen the verbal threshold no fault option to save premium costs, but the Court’s decision will go a long way towards eliminating those savings,” said NAMIC Northeast Region State Affairs Manager Paul Tetrault. “Consequently, it is vital for lawmakers to enact legislation that will undo the decision and restore consumers’ ability to make a meaningful choice regarding their auto insurance coverage.”
In DiProspero v. Penn, the Court was faced with the question of whether the Automobile Insurance Cost Reduction Act of 1998 required plaintiffs seeking to overcome the statute’s tort threshold to show their injuries had a serious impact on their life. The “serious impact” requirement had been established in a 1992 court ruling, and courts operated on the assumption that the requirement was implicitly retained in the 1998 law.
In DiProspero, however, the Court reviewed the language of the tort threshold and concluded that it did not contain an implied “serious impact” requirement.
“NAMIC supports efforts to restore the verbal threshold’s serious impact requirement in the upcoming legislative session,” said Tetrault.
For further information, contact
Rick Nelson, APR
(317) 875-5250 Tel
(317) 879-8408 Fax
Posted: Thursday, December 01, 2005 12:00:00 AM. Modified: Thursday, December 01, 2005 1:37:40 PM.
317.875.5250 - Indianapolis | 202.628.1558 - Washington, D.C.