New Laws Make Major Changes to New Jersey’s PIP System
New Jersey drivers tend to pay exorbitant amounts for their car insurance. In fact, according to the National Association of Insurance Commissioners, the car insurance premiums in the state are the third-highest in the entire country. As a result, the average driver pays about $1,100 to insure their cars. A significant part of this expense goes toward PIP coverage.
Personal injury protection, or PIP, is a part of drivers’ auto insurance that is designed to pay for any medical expenses that arise because of a car accident. In New Jersey, drivers can receive a maximum benefit of $250,000 to pay for their medical bills. Because of this high rate of compensation, some say that many fraudulent claims are made by those looking to abuse the system.
In order to address that problem, the state recently implemented new rules for PIP claims. Some experts say the change may also help prevent insurance rates from continuing to climb.
Changes to the PIP system
In an effort to help fix the problems of in the New Jersey PIP system, the following rules have been implemented:
Compensation: The new rules place a cap on the amount of reimbursement that someone can receive for certain medical procedures. By changing the price codes, the amount that will be paid out for about 2,500 healthcare procedures – including medical treatment for spinal injuries – will significantly decrease.
Arbitration: Under the new law, the amount that plaintiffs’ attorneys can be reimbursed for their services will also be reduced. In addition, there will be no hearings for cases where the claims are below $1,000. If the insurance company denies the claim, the insurer may also be required to pay the medical provider’s legal fees.
Surgery: For those who sustain spinal injuries during an accident, the new PIP rules will prevent them from being compensated if they receive treatment from an ambulatory surgical center.
Concerns about the new rules
Many people are concerned that the new PIP rules will discourage medical professionals from providing treatment in PIP cases because of the cap on compensation. This may actually cause more harm than good to motorists, as some believe that the new rules will not do much to save them money on their insurance rates.
The changes make it even more important to consult with an experienced personal injury attorney after a car accident. A skilled attorney can help accident victims stand up for their rights and fight for the insurance benefits they are entitled to. In addition, if the accident was caused by another driver’s negligence, the attorney can help victims pursue additional financial compensation in a personal injury lawsuit.