New Jersey's 'No Fault' System
Thanks in large part to the beautiful Jersey Shore, and tourist destinations like Atlantic City or Wildwood, the roads and highways of New Jersey are packed with traffic, be it commuter going to or from work, trucks transporting cargo, or out-of-state visitors. Since New Jersey is the most densely populated state, it is no surprise that it loaded with traffic, and as is often the case with heavily trafficked roadways, there is a higher than average risk of motor vehicle accidents.
New Jersey is one of several states to adopt a “no fault” insurance law for motor vehicle accidents, in the form of the Automobile Insurance Cost Reduction Act of 1998, which was designed to prevent most accident-related personal injury cases from entering the already backlogged New Jersey court system by enabling drivers and passengers in in-state motor vehicle accidents to receive compensation for injuries and lost wages more quickly.
Contrary to what many people who have been involved in a motor vehicle accident tend to believe, in New Jersey, regardless of who caused the accident or who may be thought to be “at fault,” your own insurance company is responsible for covering your medical expenses.
Often, this comes as a surprise to the dismay of many of our clients, for after being involved in a motor vehicle accident, especially one that you was not your fault, you may already be faced with many struggles – you are in pain and may be hospitalized – and then to learn that the at-fault driver cannot be held responsible for your medical bills, it is no surprise why motor vehicle accidents can be such a frustrating and stressful ordeal. However, the rationale behind New Jersey’s adoption of the ‘No Fault’ state is so that in motor vehicle accident cases, you have quicker, more immediate access to the medical treatment you need, without insurers needing to argue about assigning fault between the parties involved before medical treatment can be paid for.
Therefore, what ‘No Fault’ means is that the each driver involved in an auto accident in New Jersey is responsible for their own medical bills, either through their own auto or health insurance policy – what in personal injury law is referred to as being either “PIP Primary” or “Health Primary”.
The section of your auto policy which covers your medical costs is known as “Personal Injury Protection” benefits, or PIP. In the case that you have listed PIP as primary on your auto policy, this will cover your medical expenses up to the limit you have chosen, and the remainder, if any, will be submitted to your health insurance. A more in-depth discussion about PIP and the difference between PIP primary versus health primary will be had in subsequent blog posts and videos on our YouTube Channel, so stay tuned.
In the meantime, however, if you have questions about your auto policy, or if you have been involved in an auto accident, please feel free to reach out to us at Drinkwater & Goldstein, LLP at (856) 753-5131 for a free consultation.