NJ Residents Injured in Out of State Accidents – Does Verbal Threshold Apply?

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NJ Residents Injured in Out of State Accidents

Under New Jersey auto injury law, residents of this state who are injured in auto accidents that occur out of state may obtain financial compensation for their injuries and losses. The key issue is the status of the at-fault driver, i.e., which state the at-fault driver is from.

As a general rule, individuals covered under a verbal threshold car insurance policy issued in the state of NJ can only obtain monetary compensation for pain and suffering if their injuries fall under certain statutory exceptions. This very complex body of law is covered under the AICRA (Automobile Insurance Cost Reduction Act), which was originally passed in 1998 and has since been amended. The AICRA seriously limits a NJ resident’s ability to obtain financial compensation for pain and suffering. However, in general, this rule only applies to residents of NJ injured in auto accidents that occur in the state.

What about when NJ residents travel to other states like Pennsylvania, New York, or Delaware? It’s not uncommon for a resident of South New Jersey to drive over one of the many bridges connecting PA and NJ. For instance, a resident of Marlton or Cherry Hill, NJ may need to travel to Philadelphia for a work related meeting. A family from the New Jersey shore may head to one of Delaware’s beaches for a change of scenery. The reality is that the northeast area is well-traveled for both work and vacation. Does the verbal threshold election follow NJ drivers across state lines?

Related: New Jersey Car Accident Law – New Jersey’s Deemer Statute (Out of State Residents Injured in Auto Accidents in NJ)

Does Verbal Threshold Follow NJ Drivers When Out of State?

NJ verbal threshold law is incredibly complex. Therefore, the answer to this question is complex and depends on the status of the at-fault driver. Typically, when NJ residents with verbal threshold are injured in out of state auto accidents, the chances are very good that they will not be bound by the verbal threshold law. If the at-fault driver is a non-NJ driver, then the verbal threshold election probably does not apply. If, however, the at-fault driver happens to be a NJ driver, then the verbal threshold election would probably apply.

Out of state courts and federal courts often deal with the verbal threshold issue. That’s because NJ residents who are injured in out of state auto accidents are more likely to file their car accident lawsuits in the state where the accident occurred or where the at-fault party resides.

In two Pennsylvania federal court cases, the court found that when a NJ driver is injured in Pennsylvania, verbal threshold does not apply. See Koch v. Venezia Transportation and Harris v. Bainhauer, both of which were 2001 cases. There is a two part test to determine whether a NJ resident injured in an out of state auto accident is subject to the threshold. First, the defendant (at-fault driver) must be able to show that he or she is eligible for NJ PIP benefits. Second, it must be established that the injured party (plaintiff) elected verbal threshold. See Harris, citing Loftus-Smith v. Henry (1996) and Weiss v. Thomas (1994).

The Harris court found that an at-fault driver meets the first part of the test if he either 1. meets the requirements for PIP benefits via N.J.S.A. 39:6A-4, or 2. is “deemed” to have met them by application of the deemer statute, as per N.J.S.A. 17:28-1.4. In a nutshell, this means that in cases where a NJ driver is injured in an out of state auto accident and has a verbal threshold auto insurance policy, the at-fault driver must be a NJ driver. Otherwise, verbal threshold does not apply. Here are two examples which explain how this works.

Example 1 – NJ Driver Injured in PA, Accident Caused by Another NJ Driver

A NJ resident is in Pennsylvania and is injured in a car accident. The other, at-fault driver happens to be a resident of NJ as well and has a NJ auto insurance policy. Here, the at-fault driver is eligible for PIP benefits under NJ law because he is a resident of NJ with a NJ auto insurance policy. Therefore, the at-fault driver can raise the verbal threshold defense. If the injured driver’s injuries do not meet the statutory threshold, there is no viable claim for pain and suffering damages.

Example 2 – NJ Driver Injured in PA, Accident Caused by PA Driver

A NJ resident is in Pennsylvania and is injured in a car accident. The other, at-fault driver is a resident of PA with a PA car insurance policy. Here, the at-fault driver cannot raise the verbal threshold defense because he is not eligible for PIP benefits or otherwise deemed to be eligible for PIP by operation of NJ’s deemer statute. If the accident had occurred in New Jersey, however, the injured NJ driver would probably be subject to verbal threshold.

More: NJ Car Accident Law – Exception to Verbal Threshold: Automobiles not Covered by PIP

Verbal Threshold Car Accident Lawyer in South New Jersey

Marlton, NJ auto accident and injury lawyer Philip T. Ciprietti has handled auto injury cases for over 30 years. Call for a FREE consultation. 856.983.8695

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