Bill Text: NJ A2098 | 2010-2011 | Regular Session | Introduced
Bill Title: Permits "opt out" of compulsory automobile insurance; reinstates financial responsibility laws; eliminates territorial rate caps.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced - Dead) 2010-02-11 - Introduced, Referred to Assembly Financial Institutions and Insurance Committee [A2098 Detail]
Download: New_Jersey-2010-A2098-Introduced.html
Sponsored by:
Assemblyman HERB CONAWAY, JR.
District 7 (Burlington and Camden)
SYNOPSIS
Permits "opt out" of compulsory automobile insurance; reinstates financial responsibility laws; eliminates territorial rate caps.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning automobile insurance and revising various parts of the statutory law.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. (New section) For the purposes of sections 2 and 3 of P.L. . c. (C. ) (pending before the Legislature as this bill):
"Automobile" means a private passenger automobile of a private passenger or station wagon type that is owned or hired and is neither used as a public or livery conveyance for passengers nor rented to others with a driver; and a motor vehicle with a pickup body, a delivery sedan, a van, or a panel truck or a camper type vehicle used for recreational purposes owned by an individual or by husband and wife who are residents of the same household, not customarily used in the occupation, profession or business of the insured other than farming or ranching. An automobile owned by a farm family copartnership or corporation, which is principally garaged on a farm or ranch and otherwise meets the definitions contained in this section, shall be considered a private passenger automobile owned by two or more relatives resident in the same household.
"Chief Administrator" or "administrator" means the Chief Administrator of the New Jersey Motor Vehicle Commission.
"New Jersey Motor Vehicle Commission" means the commission established by section 4 of P.L.2003, c.13 (C.39:2A-4).
2. (New section) a. Notwithstanding the provisions of P.L.1972, c.70 (C.39:6A-1 et seq.), P.L.1972, c.197 (C.39:6B-1 et seq.), section 2 of P.L.1968, c.385 (C.17:28-1.1) or any other provision law to the contrary, an owner or registered owner of an automobile registered or principally garaged in this State may choose not to maintain private passenger automobile liability insurance coverage on that automobile.
b. An owner or registered owner who chooses not to maintain private passenger automobile insurance on an automobile registered or principally garaged in this State, shall register with the Chief Administrator of the New Jersey Motor Vehicle Commission and obtain a certificate of non-insurance in accordance with the provisions of section 3 of P.L. , c. (C. ) (pending before the Legislature as this bill).
3. (New section) a. An
application for a certificate of non-insurance shall be in writing, signed by
the applicant, on forms prepared and supplied by the administrator. The form
and content
of the certificate of non-insurance shall be determined by the administrator.
b. Fees for the processing and issuance of a certificate of non-insurance shall be determined by the administrator.
c. No automobile shall be driven or operated in this State unless a certificate of non-insurance required pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill) or an insurance identification card required pursuant to R.S.39:3-29 is in the possession of the driver or operator at all times.
4. Section 3 of P.L.1952, c.173 (C.39:6-25) is amended to read as follows:
3. (a) If 20 days after the receipt of a report of a motor vehicle accident within this State which has resulted in bodily injury or death, or damage to the property of any one person in excess of $500.00, the [director] administrator does not have on file evidence satisfactory to him that the person who would otherwise be required to file security under subsection (b) of this section has been released from liability, or has been finally adjudicated not to be liable, or has executed a duly acknowledged written agreement providing for the payment of an agreed amount in installments with respect to all claims for injuries or damages resulting from the accident, and in the event of an accident involving an automobile [, required to have] having coverage for personal injury protection benefits pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), has also reimbursed or has executed a duly acknowledged written agreement to pay an agreed amount in installments to reimburse the Unsatisfied Claim and Judgment Fund for the payment of all personal injury protection benefits the fund has made or shall make pursuant to section 7 or section 10 of P.L.1972, c.198 (C.39:6-86.1 and C.39:6-86.4) by reason of the failure of such person to have [the] any requisite insurance coverage in effect, the [director] administrator shall determine the amount of security which may be necessary in his judgment to satisfy any reimbursement, judgment or judgments for damages resulting from such accident as may be recovered against each operator or owner in view of the total insurance protection available to the injured party. The [Director] Chief Administrator of the [Division of] New Jersey Motor [Vehicles] Vehicle Commission shall promulgate such rules as may be necessary to set forth those instances where deposit of security is necessary.
(b) The [director] administrator may, within 90 days after the receipt of such report of a motor vehicle accident, suspend the license of each operator and all registrations of each owner of a motor vehicle in any manner involved in such accident, and if such operator is a nonresident the privilege of operating a motor vehicle within this State, and if such owner is a nonresident the privilege of the use within this State of any motor vehicle owned by him, unless such operator or owner or both shall deposit security in the sum so determined by the [director] administrator; provided, notice of such suspension shall be sent by the [director] administrator to such operator and owner not less than 10 days prior to the effective date of such suspension and shall state the amount required as security. Where erroneous information is given the [director] administrator with respect to the matters set forth in paragraph (1), (2) or (3) of subsection (c) of this section, he may take appropriate action as hereinbefore provided, within 90 days after receipt by him of correct information with respect to said matters.
(c) This section shall not apply under the conditions stated in section 4 of this act nor:
(1) To such operator or owner, if such owner had in effect, at the time of such accident, a motor vehicle liability policy with respect to the motor vehicle involved in such accident;
(2) To such operator, if not the owner of such motor vehicle, if there was in effect at the time of such accident a motor vehicle liability policy or bond with respect to his operation of motor vehicles not owned by him;
(3) To such operator or owner if the liability of such operator or owner for damages resulting from such accident is, in the judgment of the [director] administrator, covered by any other form of liability insurance policy or bond; nor
(4) To any person qualifying as a self-insurer under section 30 of this act, or to any person operating a motor vehicle for such self-insurer.
No such policy or bond shall be effective under this section unless issued by an insurance company or surety company authorized to do business in this State, except that if such motor vehicle was not registered in this State, or was a motor vehicle which was registered elsewhere than in this State at the effective date of the policy or bond, or the most recent renewal thereof, such policy or bond shall not be effective under this section unless the insurance company or surety company if not authorized to do business in this State shall execute a power of attorney authorizing the [director] administrator to accept service on its behalf of notice or process in any action upon such policy or bond arising out of such accident; provided, however, every such policy or bond is subject, if the accident has resulted in bodily injury or death, to a limit, exclusive of interest and costs, of not less than $15,000.00 because of bodily injury to or death of one person in any one accident and, subject to said limit for one person, to a limit of not less than $30,000.00 because of bodily injury to or death of two or more persons in any one accident, and, if the accident has resulted in injury to or destruction of property, to a limit of not less than $5,000.00 because of injury to or destruction of property of others in any one accident and if policy or bond is applicable to an automobile [required to have] having coverage for personal injury protection benefits pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), it shall include an amount to cover personal injury protection benefits as 4 required by that act.
(cf: P.L.1988, c.119, s.12)
5. Section 4 of P.L.1952, c.173 (C.39:6-26) is amended to read as follows:
4. The requirements as to security and suspension in section 3 of this act shall not apply:
(a) to the operator or the owner of a motor vehicle involved in an accident wherein no injury or damage was caused to the person or property of any one other than such operator or owner;
(b) to the operator or the owner of a motor vehicle legally parked at the time of the accident;
(c) to the owner of a motor vehicle if at the time of the accident the vehicle was being operated without his permission, express or implied, or was parked by a person who had been operating such motor vehicle without such permission; or to the operator if he was a chauffeur or operator employed by the owner of the motor vehicle and was operating with the permission of the owner.
(d) if, prior to the date that the [director] administrator would otherwise suspend license and registration or nonresident's operating privilege under section 3 of this act, there shall be filed with the [director] administrator evidence satisfactory to him that the person who would otherwise have to file security has been released from liability or been finally adjudicated not to be liable or has executed a duly acknowledged written agreement providing for the payment of an agreed amount in installments, with respect to all claims for injuries or damages resulting from the accident and with respect to an accident involving an automobile [, required to have] having coverage for personal injury protection benefits pursuant to P.L.1972, c.70, has also reimbursed or executed a duly acknowledged written agreement to pay an agreed amount in installments to reimburse the Unsatisfied Claim and Judgment Fund for the payments it has made or shall make pursuant to section 7 or section 10 of P.L.1972, c. [(Assembly Bill No. 803 presently pending in the Legislature)] 198 (C.39:6-86.1 or C.39:6-86.4) by reason of the failure of such person to have the requisite insurance coverage in effect.
(cf: P.L.1972, c.199, s.2)
6. Section 5 of P.L.1952, c.173 (C.39:6-27) is amended to read as follows:
5. The license and registration and nonresident's operating privilege suspended as provided in section [three] 3 of this act shall remain so suspended and shall not be renewed nor shall any such license or registration be issued to such person until:
(a) such person shall deposit or there shall be deposited on his behalf the security required under said section 3 of this act; or
(b) one year shall have elapsed following the date of such suspension and evidence satisfactory to the [director] administrator has been filed with him that during such period no action for damages arising out of the accident has been instituted; or
(c) evidence satisfactory to the [director] administrator has been filed with him of a release from liability, or a final adjudication of nonliability, or a duly acknowledged written agreement, in accordance with section 4(d) of P.L.1952, c.173 (C.39:6-26) and with respect to an automobile [required to have] having coverage for personal injury protection benefits pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), that person has filed evidence satisfactory to the [director] administrator that he has also met the additional requirements of section 4(d) of P.L.1952, c.173 (C.39:6-26) pertaining to such automobile; provided, however, in the event there shall be any default in the payment of any installment under any duly acknowledged written agreement, then, upon notice of such default, the [director] administrator shall forthwith suspend the license and registration or nonresident's operating privilege of such person defaulting which shall not be restored unless [and until]
(1) such person deposits and thereafter maintains security as required under said section 3 of this act in such amount as the [director] administrator may then determine; or
(2) one year shall have elapsed following the date when such security was required and during such period no action upon such agreement has been instituted in a court in this State.
Subsections 5(b) and 5(c)(1) of this section shall not apply to amounts in reimbursement of the Unsatisfied Claim and Judgment Fund which remain unpaid after [1] one year.
(cf: P.L.1972, c.199, s.3)
7. Section 8 of P.L.1952, c.173 (C.39:6-30) is amended to read as follows:
8. Security deposited in compliance with the requirements of this act shall be applicable only to the payment of a judgment or judgments rendered against the person or persons on whose behalf the deposit was made, for damages arising out of the accident in question in a civil action, begun not later than [1] one year after the date of such accident, or within [1] one year after the date of deposit of any security under [subparagraph] subsection (c) of section 5 of this act, or to the payment in settlement, agreed to by the depositor, of a claim or claims arising out of such accident or to the reimbursement of the Unsatisfied Claim and Judgment Fund for the payment of personal injury protection benefits pursuant to section or section 10 of P.L.1972, c. [(Assembly Bill No. 803 presently pending in the Legislature)] 198 (C.39:6-86.1 or C.39:6-86.4). Such deposit or any balance thereof shall be returned to the depositor or his personal representative when evidence satisfactory to the [director] administrator has been filed with him that there has been a release from liability, or a final adjudication of nonliability, or a duly acknowledged agreement in accordance with [subparagraph] subsection (d) of section 4 of this act, and in the event of an accident involving an automobile [required to have] having coverage for personal injury protection benefits pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), if the depositor has also met the additional requirements of section 4(d) of P.L.1952, c.173 (C.39:6-26) pertaining to such automobile or whenever, after the expiration of [1] one year (1) from the date of the accident, or (2) from the date of any security under [subparagraph] subsection (c) of section 5 of this act, the [director] administrator shall be given reasonable evidence that there is no such action pending and no judgment rendered in such action left unpaid and no amount in reimbursement, to the Unsatisfied Claim and Judgment Fund for payment of personal injury protection benefits, remains unpaid by such person.
(cf: P.L.1972, c.199, s.4)
8. Section 13 of P.L.1952, c.173 (C.39:6-35) is amended to read as follows:
13. If a person fails to pay and satisfy every judgment rendered against him for damages because of personal injury or death, or damage to property in excess of $500.00, resulting from the ownership, maintenance, use or operation of a motor vehicle and every judgment based on an agreement or contract made in settlement of damages arising out of a motor vehicle accident, within 60 days after its entry, or if an appeal is taken therefrom within that time, within 60 days after the judgment as entered or modified becomes final, the operator's license and all registration certificates of any such person, other than a chauffeur or operator employed by the owner of a motor vehicle and so acting at the time of the damage, injuries or death resulting in the judgment, shall, upon receiving a certified copy of a transcript of the final judgment from the court in which it was rendered showing it to have been still unsatisfied more than 60 days after it became final, be forthwith suspended by the [director] administrator.
If the [director] administrator is satisfied that a judgment debtor or his insurance carrier was, within the said 60-day period, ready, willing and able to pay the said judgment but was prevented from so doing by reason of the refusal or legal inability of the judgment creditor to accept payment, or that the failure to pay said judgment within the said 60-day period was due to the act or neglect of the judgment debtor's insurance carrier and not to any fault of the judgment debtor, then the [director] administrator may, in his discretion, extend the 60-day limitation herein prescribed for any reasonable time necessary to complete the formality of payment of the judgment and shall not suspend the judgment debtor's driver's license, operating privilege or certificate of registration.
The judgment herein mentioned shall be a judgment of a court of competent jurisdiction of this State or any other state or of a District Court of the United States.
The license and registration certificates shall remain so suspended and shall not be renewed, nor shall a motor vehicle be thereafter registered in the name of that person while the judgment remains unstayed, unsatisfied, subsisting and until every such judgment is satisfied or discharged, and the person gives proof of financial responsibility to respond in damages for future accidents as required pursuant to section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill), except that in the event that the judgment debtor shall be relieved of liability for payment of said judgment by an adjudication of the court in which the same was entered, or if the right to enforce said judgment by docketing and revival, or by revival, or by bringing an action thereon, shall have expired without such revival or the bringing of any such action thereon, the judgment debtor's license shall be restored to him, and one or more motor vehicles may be registered in his name, upon application to the [Division of] New Jersey Motor [Vehicles] Vehicle Commission.
A discharge in bankruptcy shall relieve the judgment debtor from any of the requirements of this act, except proof of financial responsibility as required pursuant to section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill), provided that the underlying judgment was not based on a willful or malicious tort.
The clerk of the court in which the judgment is rendered, or the court where it has no clerk, shall forward to the [director] administrator, at the request of the judgment creditor or his attorney, after the expiration of the 60 days a certified copy of the judgment or a transcript thereof, as aforesaid.
Upon the filing with the court of proof of satisfaction or discharge of a judgment, the nonpayment of which has been previously certified to the [director] administrator, the clerk of the court, or the court where it has no clerk shall immediately forward notice of such satisfaction or discharge to the [director] administrator.
If the defendant is a nonresident the [director] administrator shall transmit to the officer in charge of the issuance of driver licenses and registration certificates of the state of which the defendant is a resident a certified copy of the judgment.
If after proof is given, another such judgment is recovered against that person for an accident occurring before the proof was given, the license and certificate shall again be and remain suspended, and no other license or certificate shall be issued to him while the judgment so remains unsatisfied and subsisting.
(cf: P.L.1988, c.119, s.13)
9. Section 14 of P.L.1952, c.173 (C.39:6-36) is amended to read as follows:
14. While a final judgment against a nonresident motor vehicle owner or operator is so unstayed, unsatisfied and subsisting for more than 60 days, his privilege of operating a motor vehicle, whether owned by him or not, in this State, shall be withdrawn and shall not be renewed. No operator's or chauffeur's license shall be issued to him nor shall a motor vehicle be registered in his name until every such judgment is stayed, satisfied or discharged as herein provided, and he has given proof of financial responsibility to respond in damages for future accidents as required pursuant to section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill.
(cf: P.L.1979, c.169, s.2)
10. Section 16 of P.L.1952, c.173 (C.39:6-38) is amended to read as follows:
16. For the purposes of sections [9 to] 13 and 14 of this act and sections 12 through 15 of P.L. , c. (C. ) (pending before the Legislature as this bill), when:
(a) [$10,000.00] $15,000 has been credited upon any judgment or judgments rendered in excess of that amount for bodily injury to or the death of [1] one person as the result of [1] one accident;
(b) Subject to the limit of [$10,000.00] $15,000 for [1] one person so injured or killed, the sum of [$20,000.00] $30,000 has been credited upon any judgment or judgments rendered in excess of that amount for bodily injury to or the death of more than [1] one person as the result of [1] one accident; or
(c) $5,000.00 has been credited upon any judgment or judgments rendered in excess of that amount for damage to property as the result of [1] one accident--
Such payment or payments shall be deemed a satisfaction of the judgment or judgments.
(cf: P.L.1958, c.95, s.4)
11. Section 17 of P.L.1952, c.173 (C.39:6-39) is amended to read as follows:
17. A judgment debtor to whom this chapter applies may, for the sole purpose of giving authority to the [director] administrator to authorize the judgment debtor to operate a motor vehicle thereafter, on due notice to the judgment creditor, apply to the court in which the trial judgment was obtained for the privilege of paying the judgment in installments. The court, in its discretion and without prejudice to any other legal remedies which the judgment creditor may have, may so order, fixing the amounts and times of payment of the installments. The [director] administrator may, in his discretion, while the judgment debtor is not in default in paying the installments, and upon his giving proof of financial responsibility to respond for future accidents as required pursuant to section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill), restore, or refrain from suspending his license or registration certificate or certificates, or either or both of them. The license or certificate or certificates, or either or both or all of them, shall be suspended as hereinbefore provided when the [director] administrator is satisfied that the judgment debtor has failed to comply with the terms of the court order.
(cf: P.L.1979, c.169, s.4)
12. (New section) The administrator shall require as proof of financial responsibility a policy of insurance providing coverage of at least an amount or limit of $15,000, exclusive of interest and costs, on account of injury to, or death of, one person, in any one accident; an amount or limit, subject to such limit for any one person so injured or killed, of $30,000, exclusive of interest and costs, on account of injury to or death of, more than one person, in any one accident; and an amount or limit of $5,000, exclusive of interest and costs, for damage to property in any one accident.
Whenever the administrator shall require proof of financial responsibility from the owner of an automobile he shall require proof in the amounts specified for each vehicle owned or registered by that person. Pursuant to regulations promulgated by the administrator, the insurer providing the policy of insurance shall notify the New Jersey Motor Vehicle Commission of the issuance, nonrenewal and termination of the policy.
13. (New section) If a person fails to maintain proof of financial responsibility as required by section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill), the administrator shall, until proof is furnished, suspend or revoke the license of that person to operate a motor vehicle or refuse to return a license which is suspended or revoked, or suspend or revoke the registration of a motor vehicle, or refuse to register a motor vehicle transferred by him, if it shall not appear to the administrator's satisfaction that the transfer is a bona fide sale, or if a person is not a resident of this State, withdraw his privilege of operating a motor vehicle in this State and the privilege of operation within this State of a motor vehicle owned by him.
No appeal taken from the judgment of a court shall act as a stay of an action of the administrator authorized by this section or the "Motor Vehicle Security-Responsibility Law," P.L.1952, c.173 (C.39:6-23 et seq.).
The administrator may suspend or revoke the license of a person or the registration of a motor vehicle if proof of financial responsibility is not furnished or if a person's license or registration is suspended or revoked in any other state.
14. (New section) A person subject to the requirements of the "Motor Vehicle Security-Responsibility Law," P.L.1952, c.173 (C.39:6-23 et seq.), and not the owner of the motor vehicle may operate a motor vehicle when he or the owner of the motor vehicle has furnished acceptable proof of financial responsibility to the administrator.
Unless an operator who is not the owner files acceptable proof, his license shall be restricted to operating only the motor vehicles for which the owner has filed proof of financial responsibility.
In the event that person is a nonresident, his operating privilege in this State shall be limited to only those motor vehicles for which the owner has furnished to the administrator acceptable proof of financial responsibility.
15. (New section) The administrator shall, upon written request, furnish a person who sustained personal injury or property damage from a motor vehicle with information concerning the financial responsibility of the operator or owner of that motor vehicle.
16. (New section) An operator or registrant whose operator's license or registration certificate, or both, are suspended pursuant to the "Motor Vehicle Security-Responsibility Law," P.L.1952, c.173 (C.39:6-23 et seq.), or whose policy of liability insurance, as required thereunder, has been terminated, shall immediately return to the administrator his operator's license or registration certificate and the number plates issued thereunder. If a person fails to return these items, the administrator shall direct any member of the State Police, motor vehicle inspector or other police officer to secure possession of these items and return them to the administrator's office.
17. (New section) The administrator may cancel the requirement that a person maintain liability coverage, as provided in section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill), if three years have elapsed since the date of suspension or revocation of the license or registration, and if no right of action or judgment arising out of the ownership, maintenance, operation or use of a motor vehicle is then outstanding against him and remains unpaid by that person.
18. (New section) A policy of insurance furnished as proof of financial responsibility as provided in section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill) shall be a policy of liability insurance issued by an insurance carrier authorized to transact business in this State; or in the case of a person who is not otherwise able to purchase insurance from an insurance carrier, issued by an eligible surplus lines insurer to the person therein named as insured; or in the case of a nonresident, issued by an insurance carrier authorized to transact business in any of the states of the United States. The policy shall:
a. Designate, by explicit description or appropriate reference, all motor vehicles covered by the policy, and insure the named insured and any other person using or responsible for the use of a motor vehicle with the express or implied consent of the insured, against loss from the liability imposed upon the insured or other person by law, for injury to or death of a person, other than a person who is covered for injury or death by any workers' compensation law, or damage to property, except property of others in charge of the insured or the insured's employees, growing out of the maintenance, use or operation of the motor vehicle in the United States of America; or,
b. In the alternative, insure the named insured against loss from liability imposed by law for injury to or death of a person, other than a person who is covered for injury or death by any workers' compensation law, or damage to property, except property of others in charge of the insured or the insured's employees, growing out of the operation or use by the insured of a motor vehicle except a motor vehicle registered in the name of the insured, and occurring while the insured is personally in control, as driver or occupant, of the motor vehicle within the United States of America.
The policy shall insure to at least the minimum limits provided for in section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill), or a binder pending the issuance of any policy, or an endorsement to an existing policy as hereinafter provided.
This section shall not be construed as preventing the insurance carrier from granting lawful coverage in excess of or in addition to the minimum coverage, nor from embodying in the policy any agreement, provision or stipulation not contrary to the provisions of P.L.1952, c.173 (C.39:6-23 et seq.) or other laws.
19. (New section) In the case of a nonresident, a policy of insurance as required in section 12 of P.L. , c. (C. ) (pending before the Legislature as this bill) and issued by an insurance carrier authorized to transact business in the state in which the motor vehicle is registered or primarily garaged shall be considered sufficient if the carrier:
a. executes a power of attorney authorizing the administrator to accept service of notice or process in an action arising out of a motor vehicle accident in this State;
b. by its governing executive authority, duly adopts a resolution providing that its policies shall be deemed to be varied to comply with the law of this State relating to the terms of motor vehicle liability policies issued; and
c. agrees to accept as final and binding any final judgment duly rendered in an action arising out of a motor vehicle accident in a court of competent jurisdiction of this State.
This section shall apply to insurance carriers organized and existing under the laws of any other state and not licensed to transact business in this State to the extent and under the same terms and conditions that the laws of the state where the motor vehicle is registered or in which the insured resides recognize certificates of insurance carriers organized and existing under the laws of this State.
20. Section 7 of P.L.1983, c.65 (C.17:29A-36) is amended to read as follows:
7. a. Any filing made for the purpose of automobile insurance rate making shall indicate the actual rate needs of the filer; provided, however, that [(a)] each filer's rate classification definitions, as used by that filer, shall be uniform Statewide [; (b) the automobile insurance rate charged an insured shall not exceed two and one-half times the filer's territorial base rate for each coverage, exclusive of driving record surcharges and discounts; and (c) the automobile insurance rate of the base class in any territory for any filer shall not exceed 1.35 times the filer's Statewide average base rate for each coverage, exclusive of driving record surcharges and discounts for any basic policy issued or renewed at any time and for any standard policy issued or renewed before January 1, 2000 or the 180th day following approval of the common territorial rating plan pursuant to section 28 of P.L.1998, c.21 (C.17:29A-50), whichever first occurs].
b. No rating plan or rate filing applicable to any policy issued or renewed on or after January 1, 2000 or the 180th day following the approval of the common territorial rating plan provided for in sections 27 and 28 of P.L.1998, c.21 (C.17:29A-49 and C.17:29A-50), whichever first occurs, shall be approved by the commissioner which creates territorial relativities which are significantly disproportionate to those in effect as of the effective date of P.L.1998, c.21 (C.39:6A-1.1 et al.).
c. The automobile insurance rate of an automobile whose principal operator is 65 years of age or older shall not exceed one and one-quarter times the Statewide average rate for principal operators 65 years of age or older for each coverage, exclusive of driving record surcharges and discounts; provided, however, that no filer shall increase rates for principal operators 65 years of age or older as a result of the implementation of this section unless more than 50% of its insureds are principal operators 65 years of age or older.
d. As a result of the filings made pursuant to sections 26 and 27 of P.L.1998, c.21 (C.17:29A-48 and C.17:29A-49) and subsections a., b. and c. of this section, the filer's aggregate premium for all territories shall not exceed the filer's aggregate premium in effect prior to the date established in subsection b. of this section.
As used in this section, base rate means the automobile insurance rate charged for an automobile that is not used in business and not used in going to and from work, except for the going to and from work distance included in the pleasure use classification of the filer, and where there is no youthful operator, as defined in the filer's classification system. The base rate class shall not include automobiles to which discounts apply under the filer's classification system, including, but not limited to, farmers' and senior citizens' automobiles or any discount from a standard rate provided for in the filer's tier rating system.
The provisions of this section shall be implemented after the implementation of the provisions of subsection a. of section 8 of P.L.1983, c.65 (C. 17:29A-37).
(cf: P.L.1998, c.22, s.6)
21. (New section) There is established the "Automobile Insurance Reform Study Commission."
a. The study commission shall consist of 11 members as follows:
(1) the Commissioner of Banking and Insurance, or his designee, who shall serve ex officio;
(2) a representative of an automobile insurer appointed by the President of the Senate;
(3) a certified civil trial attorney who is a member of the bar of this State, appointed by the Speaker of the General Assembly;
(4) a physician licensed to practice medicine in this State, appointed by the Minority Leader of the Senate;
(5) an automobile insurance producer appointed by the Minority Leader of the General Assembly; and
(6) six public members who are citizens of this State, to be appointed by the Governor with the advice and consent of the Senate, no more than four of whom are of same political party, three of whom are each the named insured under an automobile insurance policy issued in compliance with the laws of this State.
b. Vacancies in the membership of the study commission shall be filled in the same manner provided for the original appointments. The public members of the study commission shall serve without compensation but may be reimbursed for traveling and other miscellaneous expenses necessary to perform their duties, within the limits of funds made available to the study commission for its purposes.
c. (1) The study commission shall organize as soon as practicable, but no later than the 30th day after the appointment of its members, and shall select a chairperson and vice-chairperson from among the members. The chairperson shall appoint a secretary who need not be a member of the study commission.
(2) The study commission may meet at the call of its chair and hold hearings at the times and in the places it may deem appropriate and necessary to fulfill its charge. The study commission shall be entitled to call to its assistance, and avail itself of the services of, the employees of any State, county or municipal department, board, bureau, commission or agency as it may require and as may be available to it for its purposes.
(3) The Department of Banking and Insurance shall provide staff services to the study commission.
d. The purpose of the study commission shall be to perform a comprehensive examination, analysis and study of the impact of the enactment of P.L. , c. (C. ) (pending before the Legislature as this bill) on the automobile liability insurance market, including any impact on the cost of automobile insurance coverage in this State and including further proposals to modify or repeal the "New Jersey Automobile Reparation Reform Act," P.L.1972, c.70 (C.39:6A-1 et seq.) or the "Automobile Insurance Cost Reduction Act," P.L.1998, c.21 (C.39:6A-1.1 et seq.).
e. The study commission shall present a report of its findings and recommendations to the Governor and the Legislature no later than 12 months after the date of its initial meeting.
22. This act shall take effect on the 180th day after enactment.
STATEMENT
This bill permits insureds to choose not to carry compulsory automobile insurance, including compulsory liability and no-fault insurance.
The bill provides that motorists who choose not to carry automobile liability insurance shall register with the Chief Administrator of the New Jersey Motor Vehicle Commission and obtain a certificate of non-insurance. The bill also requires that the certificate of non-insurance or an insurance identification card shall be in the possession of the driver or operator of the automobile at all times.
Under the provisions of the bill, if a driver without liability coverage has an accident, the driver must then provide proof of financial responsibility in the form of a policy of automobile liability insurance coverage in an amount or limit of at least $15,000/$30,000/$5,000 if the driver cannot meet his financial responsibility for the accident.
The bill also eliminates the territorial rate caps that were established in 1983. By eliminating the caps, certain insureds in suburban territories who choose to purchase automobile insurance could realize a reduction in their automobile insurance premium rate.
Finally, the bill establishes an 11-member "Automobile Insurance Reform Study Commission" to perform a comprehensive examination, analysis and study of the impact of the enactment of the bill on the automobile liability insurance market, including any impact on the cost of automobile insurance coverage in this State and including further proposals to modify or repeal existing automobile liability insurance provisions.
As provided in the bill, the study commission members shall include:
(1) the Commissioner of Banking and Insurance;
(2) a representative of an automobile insurer appointed by the President of the Senate;
(3) a certified civil trial attorney who is a member of the bar of this State, appointed by the Speaker of the General Assembly;
(4) a physician licensed to practice medicine in this State, appointed by the Minority Leader of the Senate;
(5) an automobile insurance producer appointed by the Minority Leader of the General Assembly; and
(6) six public members who are citizens of this State, to be appointed by the Governor with the advice and consent of the Senate, no more than four of whom are of same political party, three of whom are each the named insured under an automobile insurance policy issued in compliance with the laws of this State.
The bill directs that the study commission shall organize within 30 days of the appointment of its members, shall present a report of its findings and recommendations to the Governor and the Legislature no later than 12 months after the date of its initial meeting, and provides that the Department of Banking and Insurance shall provide staff services to the task force.
