New Jersey First-Party and Third-Party Auto Insurance Claims
It’s not the first thing you think about in the moments after impact. But after the dust has settled, the police report has been made, the car’s been towed and you’ve received medical treatment, the thought occurs to you: how am I going to pay for all of this?
If you’ve been involved in a car crash, New Jersey no-fault insurance law means that you will be entitled to certain benefits. In order to best preserve your rights, you need to learn what the benefits are and what you need to do in order to access them.
New Jersey’s no-fault insurance law can be confusing at first glance. If you are in a car crash, what benefits are you entitled to, and from whom? How do you pursue those benefits? The first thing to know is that there are two types of claims involved in any car crash case, commonly referred to as first-party (no-fault) and third-party (liability, uninsured and underinsured motorist coverage).
In a first-party situation, the claim is between you and your own insurance company, regardless of who was at fault for the crash (thus, the name “no-fault insurance”). First-party benefits are also known as personal injury protection (PIP) benefits. They include:
-Medical expenses related to your car crash
-Compensation for lost wages
-Payment for attendant care (nursing assistance and help with activities of daily living, such as bathing)
-Payment for household replacement services (such as housework, yard work or child care you can’t do because of your injury
-Reimbursement for transportation expenses to and from medical treatments, rehabilitation and therapy related to injuries from the crash
But, what if you don’t have your own auto insurance policy? You may still be covered under someone else’s policy for PIP benefits, such as a member of your household who does have an auto policy, or the owner of the vehicle in which you were riding at the time of the crash.
Receipt of these benefits is not automatic. If you don’t take the proper steps to secure the benefits, you will be permanently barred from claiming them. Within one year of the crash, you must file an application for no-fault benefits with the correct insurance company. Although you have a year to do this, you should file the application as soon as possible. If your insurer does not pay the full amount of your medical bills or other expenses, you will need to file a lawsuit to recover those expenses. Any co-pay or deductible amounts remaining, after no-fault has paid its obligated amount, can be submitted for payment to any secondary insurance you may have, such as private health insurance. New Jersey law requires your no-fault company to pay 80% of the first $5000.00 in medical bills. (So, the 20%, or $1000.00 remaining should be submitted to your secondary insurance company). After $5000.00 in bills have been incurred, your no-fault carrier is then obligated to pay 100% of your accident related bills.
A third-party claim is between you and the other driver who was at fault for causing the car crash. In a third-party claim, you would sue the at fault driver for damages for your pain and suffering as well as for any economic damages (out of pocket expenses) you may have suffered. The at-fault driver’s insurance company typically pays these damages. However, sometimes the driver who caused the crash may be driving without any insurance (uninsured motorist, otherwise known as “UM”) or very minimal insurance (known as underinsured motorist, or UIM) that is not sufficient to compensate you for your injuries. If that is the case, you will be able to file a UM or UIM claim against your own insurer or the insurer of the vehicle in which you were traveling at the time of the crash.
Do I Really Need a Lawyer If I’ve Been Involved in a Car Crash in New Jersey?
You may receive a prompt settlement offer from the insurance company, but that does not mean you should accept it. The offer may seem generous, and the prospect of avoiding a lawsuit tempting, especially if you are in pain. However, the reality is that you cannot know soon after a crash what your true expenses will be, and if you accept a settlement, you will be prevented from asking for more later if it turns out your expenses were greater than you expected. Never accept a settlement before consulting with a qualified New Jersey personal injury attorney.