Senator† JOSEPH PENNACCHIO
District 26 (Essex, Morris and Passaic)
†††† Requires automobile insurers to provide certain information regarding premiums relating to PIP coverage in certain circumstances.
CURRENT VERSION OF TEXT
†††† As introduced.
An Act concerning personal injury protection coverage and amending P.L.1983, c.362.
†††† Be It Enacted by the Senate and General Assembly of the State of New Jersey:
†††† 1.††† Section 13 of P.L.1983, c.362 (C.39:6A-4.3) is amended to read as follows:
†††† 13.† Personal injury protection coverage options. With respect to personal injury protection coverage provided on an automobile in accordance with section 4 of P.L.1972, c.70 (C.39:6A-4), the automobile insurer shall provide the following coverage options:
†††† a.†††† Medical expense benefit deductibles in amounts of $500.00, $1,000.00, $2,000.00 and $2,500.00 for any one accident;
†††† b.††† The option to exclude all benefits offered under subsections b., c., d., and e. of section 4;
†††† c.†††† (Deleted by amendment, P.L.1988, c.119.)
†††† d.††† For policies issued or renewed on or after January 1, 1991, the option that other health insurance coverage or benefits of the insured, including health care services provided by a health maintenance organization and any coverage or benefits provided under any federal or State program, are the primary coverage in regard to medical expense benefits pursuant to section 4 of P.L.1972, c.70 (C.39:6A-4).† If health insurance coverage or benefits are primary, an automobile insurer providing medical expense benefits under personal injury protection coverage shall be liable for reasonable medical expenses not covered by the health insurance coverage or benefits up to the limit of the medical expense benefits coverage.† The principles of coordination of benefits shall apply to personal injury protection medical expense benefits coverage pursuant to this subsection;
†††† e.†††† Medical expense benefits in amounts of $150,000, $75,000, $50,000 or $15,000 per person per accident; except that, medical expense benefits shall be paid in an amount not to exceed $250,000 for all medically necessary treatment of permanent or significant brain injury, spinal cord injury or disfigurement or for medically necessary treatment of other permanent or significant injuries rendered at a trauma center or acute care hospital immediately following the accident and until the patient is stable, no longer requires critical care and can be safely discharged or transferred to another facility in the judgment of the attending physician.† The coverage election form shall contain a statement, clearly readable and in 12-point bold type, in a form approved by the commissioner, that election of any of the aforesaid medical expense benefits options results in less coverage than the $250,000 medical expense benefits coverage mandated prior to the effective date of P.L.1998, c.21.
†††† If none of the aforesaid medical expense benefits options is affirmatively chosen in writing, the policy shall provide $250,000 medical expense benefits coverage.† Prior to the insured electing medical expense benefits coverage of $15,000, the insurer shall provide to the insured, in writing, the exact dollar amount that the insuredís premium is reduced by electing the $15,000 coverage in comparison to electing the $50,000 coverage, and the insured shall acknowledge receipt of this information in writing and affirmatively elect the $15,000 coverage;
†††† f.†††† The insurer shall provide an appropriate reduction from the territorial base rate for personal injury protection coverage for those electing any of the options in subsections a., b., d. and e. of this section.
†††† Any named insured who chooses the option provided by subsection d. of this section shall provide proof that he and members of his family residing in his household are covered by health insurance coverage or benefits in a manner and to an extent approved by the commissioner. Nothing in this section shall be construed to require a health insurer, health maintenance organization or governmental agency to cover individuals or treatment which is not normally covered under the applicable benefit contract or plan.† If it is determined that an insured who selected or is otherwise covered by the option provided in subsection d. of this section did not have such health coverage in effect at the time of an accident, medical expense benefits shall be payable by the person's automobile insurer and shall be subject to any deductible required by law or otherwise selected as an option pursuant to subsection a. of this section, any copayment required by law and an additional deductible in the amount of $750.
†††† An option elected by the named insured in accordance with this section shall apply only to the named insured and any resident relative in the named insured's household who is not a named insured under another automobile insurance policy, and not to any other person eligible for personal injury protection benefits required to be provided in accordance with section 4 of P.L.1972, c.70 (C.39:6A-4).
†††† Medical expense benefits payable in any amount between the deductible selected pursuant to subsection a. of this section and $5,000.00 shall be subject to the copayment provided in the policy, if any.
†††† No insurer or health provider providing benefits to an insured who has elected a deductible pursuant to subsection a. of this section shall have a right of subrogation for the amount of benefits paid pursuant to a deductible elected thereunder or any applicable copayment.
†††† The Commissioner of Banking and Insurance shall adopt rules and regulations to effectuate the purposes of this section and may promulgate standards applicable to the coordination of personal injury protection medical expense benefits coverage.
(cf: P.L.1998, c.22, s.3)
†††† 2.††† This act shall take effect immediately and apply to policies issued or renewed on or after the 180th day next following enactment.
†††† This bill requires automobile insurers to provide certain information regarding premiums when an insured elects medical expense benefits in an amount of $15,000 as part of personal injury protection coverage.† Specifically, the bill requires the insurer to, prior to the insured electing medical expense benefits coverage of $15,000, provide to the insured, in writing, the exact dollar amount that the insuredís premium is reduced by electing the $15,000 coverage in comparison to electing the $50,000 coverage.† The insured must acknowledge receipt of this information in writing and affirmatively elect the $15,000 coverage.
†††† Under current law, in addition to the default of $250,000, insurers must provide coverage options for medical expense benefits in amounts of $150,000, $75,000, $50,000 or $15,000 per person per accident.† If none of these medical expense benefits options is affirmatively chosen in writing, the policy must provide $250,000 medical expense benefits coverage.†
†††† It has come to the sponsorís attention that in many situations, the minimum option of $15,000 does not provide adequate coverage and also may not save a significant amount for the insured on the policy premium.† Therefore, this bill is intended to ensure that insureds make an informed decision when deciding on $15,000 in PIP coverage and understand the exact dollar amount that is saved on their premium when making that selection.†