New Jersey Senate Bill S1463

New Jersey 2024-2025 Regular Session

• Introduced: 1/9/24
• Refer: 1/9/24

Caption

Clarifies the violation of "New Jersey Insurance Fraud Prevention Act" results in loss of motor vehicle liability insurance coverage in certain circumstances; provides coverage for innocent persons in certain situations involving insurance fraud.

Impact

The bill provides that innocent individuals injured by a motor vehicle associated with a policy that has been voided may seek compensation primarily through uninsured motorist coverage or the Unsatisfied Claim and Judgment Fund, should they not have other means of coverage. Additionally, it stipulates that those seeking recourse through the Unsatisfied Claim and Judgment Fund will not be subject to verbal threshold requirements, thus allowing easier access to claims for these victims. This provision is significant as it changes the dynamics of liability and insurance recourse, potentially increasing the responsibilities of insurers and the protections for victims of vehicular incidents.

Summary

Senate Bill S1463 amends the 'Motor Vehicle Security-Responsibility Law' to clarify the implications of violating the 'New Jersey Insurance Fraud Prevention Act' on motor vehicle liability insurance coverage. Under this bill, if a person violates any provision of the Fraud Prevention Act, any associated motor vehicle liability policy would be deemed voided. Therefore, the insurance carrier would not be liable for any claims made by that person or any innocent parties injured due to an incident involving the voided policy. This change aims to protect insurance companies from having to cover losses incurred in situations where fraudulent behavior is present.

Contention

Noteworthy points of contention surrounding S1463 may arise from the implications for motor vehicle safety and insurance fraud prevention measures. Supporters of the bill argue that it provides a necessary deterrent against fraud by ensuring that individuals engaging in such activities cannot benefit from insurance coverage. In contrast, critics may highlight concerns over the adequacy of protections for innocent victims who may find themselves without adequate coverage in the event of an accident involving a fraudulent policyholder. Furthermore, the potential impact on victims' access to justice may fuel debates on whether the bill offers fair resolutions.