The New Jersey Supreme Court issued a recent opinion regarding no-fault insurance coverage arising from automobile accidents. In Haines v. Taft, the Court considered whether the legislature intended to deviate from its highly regulated no-fault system of first-party self-insurance to cover medical expenses arising from automobile accidents when it amended the statute to allow an insured to elect smaller amounts of personal injury protection (“PIP”) under a standard policy?
In this case, each plaintiff was injured in a car accident and was insured under a standard policy with insurance that provided for $15,000 in PIP no-fault coverage instead of the default amount of $250,000. Neither plaintiff was able to sustain a claim for bodily injury (non-economic loss) due to the fact that each policy's limitation-on-lawsuit option. As a result, each plaintiff was suing for outstanding medical provider charges in excess of their elected $15,000 PIP coverage ($28,000 and $10,000, respectively).
Each plaintiff filed a personal injury claim, and each defendant moved to preclude that plaintiff from presenting evidence of medical expenses that exceeded their $15,000 PIP limits. The defendants relied on N.J.S.A. 39:6A-12 (Section 12), which addresses the inadmissibility of evidence of losses collectible under personal injury protection, and Roig v. Kelsey, 135 N.J. 500, 641 A.2d 248 (1994). In Roig, the Court held that the public policies underlying the no-fault system required that Section 12 be construed to prohibit injured parties from recovering medical deductibles and copayments from a tortfeasor.
The Trial Court ruled against the plaintiffs in each matter and prohibited both plaintiffs from admitting evidence of their medical expenses that exceeded their $15,000 PIP limits. The Appellate Division consolidated the cases on appeal, and, in a published opinion, reversed both Trial Court orders stating in pertinent part… “Unless the Legislature makes such an intent clearly known, the Court will not assume that such a change was intended by the Legislature through its amendments to the no-fault system in the Automobile Insurance Cost Reduction Act.” The Supreme Court granted defendants' petitions for certification and concluded that the Appellate Division judgment must be reversed to ensure that the legislative intent of AICRA was maintained.
“Under the No-Fault Law, the ability to sue is the exception, not the rule. The Legislature has determined that the benefits of creating limited but automatic medical reimbursement for injured motor-vehicle-accident victims outweigh the ability of a minority of injured parties to recover larger amounts in tort.” Haines v. Taft, 237 N.J. 271 (2019).
In Haines, The Supreme Court of New Jersey opined that it was legislature’s belief that it is good public policy to provide medical benefits on a first party basis without regard to fault to persons injured in automobile accidents. However, in order to keep premium costs down, the benefit must be offset by a reduction in the cost of other coverages. Most notably, a restriction on the right of persons, who have non-permanent or non-serious injuries, to sue for pain and suffering.