Every individual in New Jersey that owns a car is required by New Jersey law to purchase insurance for that car. The laws of New Jersey also require the owner of the car to purchase certain amounts of insurance coverage.
Most individuals, rightfully so, would expect that when the time comes to use the insurance that they have paid for, their own insurance company would readily provide them coverage. Unfortunately, all too frequently that does not occur, and the insurance company will delay paying out benefits or refuse to pay out benefits all together.
More unfortunate is that the laws of New Jersey do not adequately protect the person who purchased the insurance, since they prevent individuals from suing their insurance company to get the benefits they have paid for. Therefore, the person who purchased the insurance, has no remedy against the insurance company when it either delays or refuses to pay out benefits. This results in the insurance company have very little incentive to do the right thing and pay legitimate claims in a timely manner.
In order to deal with this recurring issue, that the attorneys and staff at Cerussi & Gunn deal with on a daily basis, a bill entitled the “New Jersey Insurance Fair Conduct Act” has been introduced in the New Jersey Legislature. If passed and signed by the governor, this act would give the holders of insurance the right to sue their own insurance companies for what is known as “bad faith,” meaning the insurance company unreasonably denies to provide the contracted for benefits to the insured, fails to timely provide benefits to the insured, or takes other unreasonable actions against the insured.
You can be sure that the insurance companies are going to lobby against this bill, so only time will tell whether our elected officials will push the bill through, despite opposition from the insurance industry.