The tough economy puts pressure on almost everyone. With jobs scarce and wages static, it gets harder and harder to make ends meet. Naturally, then, you look for places to save wherever you can. In general, that is a sound strategy for surviving in challenging economic times.
But when choosing your options for car insurance in New Jersey, you need to consider carefully. The so-called "verbal threshold" option is less expensive than the "zero threshold" option. But if you choose the verbal threshold option, it becomes very difficult to sue for personal injuries suffered in a New Jersey car accident.
PIP Coverage in New Jersey
The relevant New Jersey statute governing choice of automobile insurance coverage is N.J.S.A. 39:6A-8. It limits the ability of people who choose the "verbal threshold" (limitation on lawsuit) option from pursuing non-economic damages, unless their injuries fit under one of the designated exceptions.
The statute has a legislative history that dates to 1972, when New Jersey adopted a no-fault insurance system for automobile accident cases. The new law required insurers to offer policies containing personal injury protection (PIP) benefits to all registered drivers in New Jersey. PIP benefits include such things as medical expenses, income continuation, essential services and funeral expenses. These benefits were to be available to a policy holder injured in an accident, even if he or she was not at fault.
The insurance premiums to pay for such benefits can be expensive, however. So all along, under the no-fault law, a policyholder could choose an option that limited his or her right to bring a personal injury lawsuit. Initially, there was a monetary threshold of $200. You couldn't bring suit for those damages unless your medical expenses were shown to be more than $200.
Eventually, this monetary threshold was increased to $1500. In 1988, the New Jersey Legislature replaced it with a "verbal threshold." Only types of injuries that fit into certain stated categories would be eligible to pursue damages for non-economic loss. Because these categories are expressed in words, they have come to be known as the "verbal threshold." This type of policy also became the default type of coverage, for those who do not elect otherwise.
Once this amendment took effect, a policyholder could still choose a "zero threshold" option to retain their right to bring legal action for non-economic loss, no matter what type of injury he or she suffered. But it was necessary to specifically select this coverage, and to pay higher premiums for it.
Disfiguring or Disabling Injuries
For over two decades now, the New Jersey courts have enforced a tight interpretation of what types of injuries meet the verbal threshold. In short, injuries must be "disfiguring" or "disabling."
The older legal test used to be whether there was a "serious life impact" from the injury. But the emphasis now is on disfiguring or disabling injuries. Even major fractures may or may not meet this standard, depending on whether they are deemed to be permanently disfiguring or disabling.
Practical Effect of the Verbal Threshold
The practical effect of the verbal threshold rule is that it is often difficult to recover from an insurance company on a lawsuit for personal injuries suffered in a motor vehicle accident. New Jersey car accident lawyers know that insurance companies do everything they can to push their agents into getting people to choose the verbal threshold option. Perhaps 7 times out of 10, in drawing up the policy, the agents succeed in this.
But that doesn't mean that auto accident victims are always out of luck either. Talk with an experienced New Jersey personal injury lawyer about what your legal options are, no matter what type of insurance you chose. Many attorneys take cases on a contingent fee basis, and it may help your piece of mind to know you are doing everything you can to assert your rights.
