By Francis M. Smith
A bill recently passed in the New Jersey Senate will help injured plaintiffs make informed decisions in their pursuit of fair compensation for their injuries. The bill, S-2429, passed in the State Senate at the end of March, requires that insurance providers disclose the limits of coverage on a policy held by a customer who is party to an injury claim. After receiving a request for disclosure in connection with an injury claim (which must include a statement that the attorney represents a person injured in an accident involving someone insured by the provider, the insured person’s name and last known address, the date and time of the accident, and any existing police report), the insurance company has 30 days to respond in writing with a disclosure of the policy limits in question. The bill was sponsored by Senator Nicholas Scutari and Senator Nellie Pou, and co-sponsored by Senator Chris Brown. Having passed in the Senate on March 25th by a vote of 27-9, S-2429 will be sent to the Assembly to be considered.
Currently, New Jersey law requires that an automotive accident injury victim file a lawsuit seeking compensation for damages before they are able to find out how much insurance coverage the other driver involved was carrying. Most automotive injury cases are resolved with a settlement agreement outside of court, often without the need for a trial. This begs the question: why is litigation necessary at all? In many cases, accident victims are advised to move forward with filing suit only when settlement negotiations have stalled or failed completely, or when the statute of limitations for their case (usually two years) is close to running out. Forcing almost every accident victim to initiate the process of a lawsuit in order to find out the insurance policy limits of the driver responsible for their injuries serves only to clog court schedules with cases that will probably never make it to trial, slowing down the process for others whose cases do need to be heard by the court in order to obtain justice.
The new legislation would reduce the number of needless court filings by enabling injury victims and their attorneys to obtain basic and essential information about their cases without filing suit prematurely and unnecessarily. It also helps accident victims and their lawyers focus their efforts more effectively; if the negligent driver did not have liability coverage, the injured plaintiff knows that they need to make a claim with his or her own insurance provider using their Uninsured Motorist (UM) coverage. Similarly, if the other driver’s liability insurance policy limits are insufficient to adequately compensate the accident victim for all injuries and losses, their attorney can consolidate the claim against the negligent defendant’s insurance and the injured plaintiff’s Underinsured Motorist (UIM) coverage into a single lawsuit, rather than juggling two separate suits or having to amend a suit already in progress.
Having the ability to discover the other driver’s insurance policy limits earlier in the claim process also helps the accident victim make informed decisions about their medical treatment. Serious injuries can run up sizable medical bills, and if an injured plaintiff knows that the insurance coverage to pay for those bills isn’t there, then the plaintiff is faced with hard choices about pursuing the medical care they need and dealing with the resulting medical debt. When facing such difficult decisions about their health and financial stability, the accident victim deserves to have the information they need to make the best choice possible before they commit to costly medical procedures. By the same token, the requirement for disclosure of policy limits also benefits the medical care providers who would perform those procedures, and who have a right to be paid for their efforts. If an accident victim knows that the other driver’s insurance policy will not cover some or all of their medical expenses, they are less likely to undergo costly treatment that they cannot otherwise afford, due to a recent unenlightened punitive N.J. Supreme Court ruling.
The prospect of an accident victim who was injured through another driver’s negligence needing to balance the medical treatment necessary to recover against the limits of the other driver’s insurance policy is a grim one, but even worse is the reality of having to make those decisions blind, or being forced to invest even more time, money, and energy into initiating a lawsuit in order to obtain the basic facts needed to make an informed decision. That is the reality that the bill passed by the New Jersey Senate last month seeks to rectify. At the same time, it streamlines the legal process for those whose cases do make it to court by removing the congestion of so many unnecessary lawsuits from court calendars. Should S-2429 ultimately be ratified, it will remove an unnecessary impediment in the way of car accident victims seeking to be reasonably compensated for their injuries. The sponsors of the bill and those members of the Senate who voted to pass the bill deserve our thanks.