New Jersey drivers should have a fundamental understanding of how the state's auto insurance coverage system works, especially since it's a "no-fault" state.

What does this mean? It means you are covered whether or not you caused an accident or are at-fault in a car accident. We will cover this in more detail in the following article, but in short, if you have the required insurance, your own insurance will cover some of your losses.

If you've been in an accident in New Jersey, suffered an injury and are looking for help, the law office of Brandon J. Broderick, Attorney at Law is here 24/7 to assist.

No-Fault State: New Jersey

Because New Jersey follows a no-fault insurance system, your own auto insurance company is liable for certain accident-related expenses regardless of who was at fault. Therefore, even if the other motorist was obviously at fault for an accident you were involved in, your insurance company will pay for your medical expenses. This is the opposite of how a "fault" state works.

However, some no-fault states have different laws. Personal Injury Protection, or "PIP," which pays your medical fees if you are hurt in an accident, is a requirement for all drivers in New Jersey. If you or others are hurt in a car accident, PIP will pay for medical care. This is commonly referred to as "no-fault" coverage.

New Jersey No-Fault Insurance

This is a basic overview of how auto insurance coverage works in the state of New Jersey:

• Vehicle owners are required by law to maintain a "Basic Policy" in New Jersey at minimum, which combines liability insurance and PIP coverage to pay for damage to other drivers' vehicles and medical costs.
• For drivers in New Jersey, a "Standard Policy" offers extra alternatives for coverage.
• When it comes to choices for receiving compensation after an accident, including a "Unlimited Right to Sue" option, New Jersey provides more options than most no-fault jurisdictions.

What is Covered Under No-Fault Auto Insurance?

New Jersey no-fault/PIP insurance provides the following benefits depending on whether the "Basic" or "Standard" option is selected when purchasing an automobile insurance policy:

• Medical expenses and costs related to treatment
• Compensation for lost wages or income due to time away from work
• Reimbursement of the cost of "replacement services," when you are unable to perform specific responsibilities due to your injury
• "Death benefit" and "funeral benefit" coverages in the event of a fatal injury due to the car accident

In New Jersey, PIP policy holders have the option of choosing larger deductibles to lower their PIP rates. They can also reduce the price of their auto insurance by designating their health insurer as their primary source of coverage for medical expenses following a car accident.

Lastly, drivers who qualify for Federal Medicaid may also purchase a "Special Automobile Insurance Policy" from New Jersey.

"Limited Right to Sue" Explained

Under a "Basic" policy, medical costs and other economic losses incurred by anyone covered under the policy will be paid after a car accident, up to the limits of PIP coverage and regardless of who was at fault. However, under the Basic Policy, the claimant is obligated to use what is known as a "limited right to sue." Outside of the no-fault PIP coverage, the injured party may only take legal action against the at-fault motorist if the accident resulted in their suffering:

• the removal of a body part
• significant disfigurement
• significant scarring
• displaced fracture
• the death of a fetus
• permanent injury
• death

The injured person has the right to file a third-party auto insurance claim or a personal injury lawsuit against the at-fault driver if the impact of the accident has reached this threshold. These actions allow recovery of "pain and suffering" damages and other non-economic losses (which are not available through a no-fault or PIP claim).

Who Is Covered by No-Fault Auto Insurance in New Jersey?

In addition to the policyholder, no-fault/PIP auto insurance will usually cover:

• Members of the policyholder's family or household (if they don't have their own auto insurance policy)
• Anyone who borrows the policyholder's car and drives it without obtaining their own insurance
• Any passengers in the policyholder's car (if they don't have their own insurance)

Does Damage to My Car Get Covered by New Jersey No-Fault Insurance?

Vehicle damage claims are not covered under a no-fault/PIP claim in New Jersey. There are no restrictions on making a claim against the at-fault motorist for damage to (or entire loss of) a car. You would have to file a separate third-party car insurance claim against the other driver's car insurer (or even a lawsuit) for vehicle damage.

Hire Brandon J. Broderick, Attorney at Law If You've Suffered Injury in a Car Accident

Our team of NJ car accident lawyers can help you through the sometimes complicated process of filing a car accident claim or personal injury case. We pride ourselves in providing our clients with the best legal help possible.

Call us today for a free consultation.

We service the entire state of New Jersey, with offices in Trenton, Jersey City, Newark, Paterson, Toms River, and Atlantic City to name a few.