A2698

ASSEMBLY, No. 2698

STATE OF NEW JERSEY

INTRODUCED FEBRUARY 3, 1997

By Assemblymen MORAN and CONNORS

An Act concerning automobile insurance and revising various parts of the statutory law.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 1 of P.L.1972, c.197 (C.39:6B-1) is amended to read as follows:

1. Every owner or registered owner of a motor vehicle, other than an automobile, registered or principally garaged in this State shall maintain motor vehicle liability insurance coverage, under provisions approved by the Commissioner of Insurance, insuring against loss resulting from liability imposed by law for bodily injury, death and property damage sustained by any person arising out of the ownership, maintenance, operation or use of a motor vehicle, other than an automobile, wherein such coverage shall be at least in: a. an amount or limit of $15,000.00, exclusive of interest and costs, on account of injury to, or death of, one person, in any one accident; and b. an amount or limit, subject to such limit for any one person so injured or killed, of $30,000.00, exclusive of interest and costs, on account of injury to or death of, more than one person, in any one accident; and c. an amount or limit of $5,000.00, exclusive of interest and costs, for damage to property in any one accident.

For purposes of this section, "automobile" means a private passenger automobile of a private passenger or station wagon type that is owned or hired and is neither used as a public or livery conveyance for passengers nor rented to others with a driver; and a motor vehicle with a pickup body, a delivery sedan, a van, or a panel truck or a camper type vehicle used for recreational purposes owned by an individual or by husband and wife who are residents of the same household, not customarily used in the occupation, profession or business of the insured other than farming or ranching. An automobile owned by a farm family copartnership or corporation, which is principally garaged on a farm or ranch and otherwise meets the definitions contained in this section, shall be considered a private passenger automobile owned by two or more relatives resident in the same household.

(cf: P.L.1972, c.197, s.1)

2. Section 2 of P.L.1972, c.197 (C.39:6B-2) is amended to read as follows:

2. Any owner or registrant of a motor vehicle, other than an automobile as defined in section 1 of P.L.1972, c.197 (C.39:6B-1), registered or principally garaged in this State who operates or causes to be operated a motor vehicle, other than an automobile, upon any public road or highway in this State without motor vehicle liability insurance coverage required by this act, and any operator who operates or causes a motor vehicle, other than an automobile, to be operated and who knows or should know from the attendant circumstances that the motor vehicle is without motor vehicle liability insurance coverage required by this act shall be subject, for the first offense, to a fine of $300.00 and a period of community service to be determined by the court, and shall forthwith forfeit his right to operate a motor vehicle over the highways of this State for a period of one year from the date of conviction. Upon subsequent conviction, he shall be subject to a fine of $500.00 and shall be subject to imprisonment for a term of 14 days and shall be ordered by the court to perform community service for a period of 30 days, which shall be of such form and on such terms as the court shall deem appropriate under the circumstances, and shall forfeit his right to operate a motor vehicle for a period of two years from the date of his conviction, and, after the expiration of said period, he may make application to the Director of the Division of Motor Vehicles for a license to operate a motor vehicle, which application may be granted at the discretion of the director. The director's discretion shall be based upon an assessment of the likelihood that the individual will operate or cause a motor vehicle, other than an automobile, to be operated in the future without the insurance coverage required by this act. A complaint for violation of this act may be made to a municipal court at any time within six months after the date of the alleged offense.

Failure to produce at the time of trial an insurance identification card or an insurance policy which was in force for the time of operation for which the offense is charged, creates a rebuttable presumption that the person was uninsured when charged with a violation of this section.

[Notwithstanding any provision of P.L.1972, c.197 (C.39:6B-1 et seq.), any person who violates the provisions of that act, from October 1, 1990 through January 31, 1991, shall not be subject to any of the penalties or sanctions provided for a first violation of that act if that person produces at the time of trial an insurance identification card or a motor vehicle liability insurance policy which is in force at the time of the trial and the conviction for that person's offense would be the person's first conviction for an offense under that act. The Commissioner of Insurance shall appropriately promote and advertise this limited time amnesty program for first-time offenses under that act throughout the State.]

(cf: P.L.1990, c.8, s.49)

3. Section 2 of P.L.1968, c.385 (C.17:28-1.1) is amended to read as follows:

2. a. No motor vehicle liability policy or renewal of such policy of insurance, including a liability policy for an automobile as defined in section [2 of P.L.1972, c.70 (C.39:6A-2)] 1 of P.L.1972, c.197 (C.39:6B-1), insuring against loss resulting from liability imposed by law for bodily injury or death, sustained by any person arising out of the ownership, maintenance or use of a motor vehicle, shall be issued in this State with respect to any motor vehicle registered or principally garaged in this State unless it includes coverage in limits for bodily injury or death as follows:

(1) an amount or limit of $15,000.00, exclusive of interest and costs, on account of injury to, or death of, one person, in any one accident, and

(2) an amount or limit, subject to such limit for any one person so injured or killed, of $30,000.00, exclusive of interest and costs, on account of injury to or death of more than one person, in any one accident,

under provisions approved by the Commissioner of Insurance, for payment of all or part of the sums which the insured or his legal representative shall be legally entitled to recover as damages from the operator or owner of an uninsured motor vehicle, or hit and run motor vehicle, as defined in section 16 of P.L.1952, c.174 (C.39:6-78), because of bodily injury, sickness or disease, including death resulting therefrom, sustained by the insured, caused by accident and arising out of the ownership, maintenance or use of such uninsured or hit and run motor vehicle anywhere within the United States or Canada [; except that uninsured motorist coverage shall provide that in order to recover for non-economic loss, as defined in section 2 of P.L.1972, c.70 (C.39:6A-2), for accidents to which the benefits of section 4 (C.39:6A-4) of that act apply, the tort option elected pursuant to section 8 (C. 39:6A-8) of that act shall apply to that injured person].

All motor vehicle liability policies shall also include coverage for the payment of all or part of the sums which persons insured thereunder shall be legally entitled to recover as damages from owners or operators of uninsured motor vehicles, other than hit and run motor vehicles, because of injury to or destruction to the personal property of such insured, with a limit in the aggregate for all insureds involved in any one accident of $5,000.00, and subject, for each insured, to an exclusion of the first $500.00 of such damages.

b. Uninsured and underinsured motorist coverage shall be provided as an option by an insurer to the named insured up to at least the following limits: $250,000.00 each person and $500,000.00 each accident for bodily injury; $100,000.00 each accident for property damage or $500,000.00 single limit, subject to an exclusion of the first $500.00 of such damage to property for each accident, except that the limits for uninsured and underinsured motorist coverage shall not exceed the insured's motor vehicle liability policy limits for bodily injury and property damage, respectively.

Rates for uninsured and underinsured motorist coverage for the same limits shall, for each filer, be uniform on a Statewide basis without regard to classification or territory.

c. Uninsured and underinsured motorist coverage provided for in this section shall not be increased by stacking the limits of coverage of multiple motor vehicles covered under the same policy of insurance nor shall these coverages be increased by stacking the limits of coverage of multiple policies available to the insured. If the insured had uninsured motorist coverage available under more than one policy, any recovery shall not exceed the higher of the applicable limits of the respective coverages and the recovery shall be prorated between the applicable coverages as the limits of each coverage bear to the total of the limits.

d. Uninsured and underinsured motorist coverage shall be subject to the policy terms, conditions and exclusions approved by the Commissioner of Insurance, including, but not limited to, unauthorized settlements, nonduplication of coverage, subrogation and arbitration.

e. For the purpose of this section, (1) "underinsured motorist coverage" means insurance for damages because of bodily injury and property damage resulting from an accident arising out of the ownership, maintenance or use of an underinsured motor vehicle. Underinsured motorist coverage shall not apply to an uninsured motor vehicle. A motor vehicle is underinsured when the sum of the limits of liability under all bodily injury and property damage liability bonds and insurance policies available to a person against whom recovery is sought for bodily injury or property damage is, at the time of the accident, less than the applicable limits for underinsured motorist coverage afforded under the motor vehicle insurance policy held by the person seeking that recovery. A motor vehicle shall not be considered an underinsured motor vehicle under this section unless the limits of all bodily injury liability insurance or bonds applicable at the time of the accident have been exhausted by payment of settlements or judgments. The limits of underinsured motorist coverage available to an injured person shall be reduced by the amount he has recovered under all bodily injury liability insurance or bonds;

(2) "uninsured motor vehicle" means:

(a) a motor vehicle with respect to the ownership, operation, maintenance, or use of which there is no bodily injury liability insurance or bond applicable at the time of the accident;

(b) a motor vehicle with respect to the ownership, operation, maintenance, or use of which there is bodily injury liability insurance in existence but the liability insurer denies coverage or is unable to make payment with respect to the legal liability of its insured because the insurer has become insolvent or bankrupt, or the Commissioner of Insurance has undertaken control of the insurer for the purpose of liquidation; or

"Uninsured motor vehicle" shall not include an underinsured motor vehicle; a motor vehicle owned by or furnished for the regular use of the named insured or any resident of the same household; a self-insurer within the meaning of any financial responsibility or similar law of the state in which the motor vehicle is registered or principally garaged; a motor vehicle which is owned by the United States or Canada, or a state, political subdivision or agency of those governments or any of the foregoing; a land motor vehicle or trailer operated on rails or crawler treads; a motor vehicle used as a residence or stationary structure and not as a vehicle; or equipment or vehicles designed for use principally off public roads, except while actually upon public roads.

(cf: P.L.1988, c.119, s.11)

4. Section 8 of P.L.1985, c.520 (C.17:28-1.4) is amended to read as follows:

8. Any insurer authorized to transact or transacting [automobile or] motor vehicle insurance business, other than automobile insurance business, in this State, or controlling or controlled by, or under common control by, or with, an insurer authorized to transact or transacting insurance business in this State, which sells a policy providing [automobile or] motor vehicle liability insurance coverage, or any similar coverage, other than automobile insurance coverage, in any other state or in any province of Canada, shall include in each motor vehicle liability insurance policy , other than an automobile liability insurance policy, coverage to satisfy at least the liability insurance requirements of section 1 of P.L.1972, c.197 (C.39:6B-1) [or section 3 of P.L.1972, c.70 (C.39:6A-3),] and the uninsured motorist insurance requirements of subsection a. of section 2 of P.L.1968, c.385 (C.17:28-1.1), [and personal injury protection benefits coverage pursuant to section 4 of P.L.1972, c.70 (C.39:6A-4) or of section 19 of P.L.1983, c.362 (C.17:28-1.3),] whenever the [automobile or] motor vehicle,other than an automobile insured under the policy is used or operated in this State.

Any liability insurance policy subject to this section shall be construed as providing the coverage required herein [, and any named insured, and any immediate family member as defined in section 14.1 of P.L.1983, c.362 (C.39:6A-8.1), under that policy, shall be subject to the tort option specified in subsection a. of section 8 of P.L.1972, c.70 (C.39:6A-8)].

Each insurer authorized to transact or transacting [automobile or] motor vehicle insurance business ,other than automobile insurance business, in this State and subject to the provisions of this section shall, within 30 days of the effective date of P.L.1985, c.520, file and maintain with the Department of Insurance written certification of compliance with the provisions of this section.

"Automobile" means an automobile as defined in section [2 of P.L.1972, c.70 (C.39:6A-2)] 1 of P.L.1972, c.197 (39:6B-1).

(cf: P.L.1988, c.119, s.1)

5. Section 3 of P.L.1952, c.173 (C.39:6-25) is amended to read as follows:

3. (a) If 20 days after the receipt of a report of a motor vehicle accident within this State which has resulted in bodily injury or death, or damage to the property of any one person in excess of $500.00, the director does not have on file evidence satisfactory to him that the person who would otherwise be required to file security under subsection (b) of this section has been released from liability, or has been finally adjudicated not to be liable, or has executed a duly acknowledged written agreement providing for the payment of an agreed amount in installments with respect to all claims for injuries or damages resulting from the accident, [and in the event of an accident involving an automobile, required to have coverage for personal injury protection benefits pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), has also reimbursed or has executed a duly acknowledged written agreement to pay an agreed amount in installments to reimburse the Unsatisfied Claim and Judgment Fund for the payment of all personal injury protection benefits the fund has made or shall make pursuant to section 7 or section 10 of P.L.1972, c.198 (C.39:6-86.1 and C.39:6-86.4) by reason of the failure of such person to have the requisite insurance coverage in effect,] the director shall determine the amount of security which may be necessary in his judgment to satisfy any reimbursement, judgment or judgments for damages resulting from such accident as may be recovered against each operator or owner in view of the total insurance protection available to the injured party. The Director of the Division of Motor Vehicles shall promulgate such rules as may be necessary to set forth those instances where deposit of security is necessary.

(b) The director may, within 90 days after the receipt of such report of a motor vehicle accident, suspend the license of each operator and all registrations of each owner of a motor vehicle in any manner involved in such accident, and if such operator is a nonresident the privilege of operating a motor vehicle within this State, and if such owner is a nonresident the privilege of the use within this State of any motor vehicle owned by him, unless such operator or owner or both shall deposit security in the sum so determined by the director; provided, notice of such suspension shall be sent by the director to such operator and owner not less than 10 days prior to the effective date of such suspension and shall state the amount required as security. Where erroneous information is given the director with respect to the matters set forth in paragraph (1), (2) or (3) of subsection (c) of this section, he may take appropriate action as hereinbefore provided, within 90 days after receipt by him of correct information with respect to said matters.

(1) To such operator or owner, if such owner had in effect, at the time of such accident, a motor vehicle liability policy with respect to the motor vehicle involved in such accident;

(2) To such operator, if not the owner of such motor vehicle, if there was in effect at the time of such accident a motor vehicle liability policy or bond with respect to his operation of motor vehicles not owned by him;

(3) To such operator or owner if the liability of such operator or owner for damages resulting from such accident is, in the judgment of the director, covered by any other form of liability insurance policy or bond; nor

(4) To any person qualifying as a self-insurer under section 30 of this act, or to any person operating a motor vehicle for such self-insurer.

No such policy or bond shall be effective under this section unless issued by an insurance company or surety company authorized to do business in this State, except that if such motor vehicle was not registered in this State, or was a motor vehicle which was registered elsewhere than in this State at the effective date of the policy or bond, or the most recent renewal thereof, such policy or bond shall not be effective under this section unless the insurance company or surety company if not authorized to do business in this State shall execute a power of attorney authorizing the director to accept service on its behalf of notice or process in any action upon such policy or bond arising out of such accident; provided, however, every such policy or bond is subject, if the accident has resulted in bodily injury or death, to a limit, exclusive of interest and costs, of not less than $15,000.00 because of bodily injury to or death of one person in any one accident and, subject to said limit for one person, to a limit of not less than $30,000.00 because of bodily injury to or death of two or more persons in any one accident, and, if the accident has resulted in injury to or destruction of property, to a limit of not less than $5,000.00 because of injury to or destruction of property of others in any one accident [and if policy or bond is applicable to an automobile required to have coverage for personal injury protection benefits pursuant to P.L.1972, c.70 (C.39:6A-1 et seq.), it shall include an amount to cover personal injury protection benefits as required by that act].

(cf: P.L.1988, c.119, s.12)

6. Section 4 of P.L.1952, c.173 (C.39:6-26) is amended to read as follows:

4. The requirements as to security and suspension in section 3 of this act shall not apply:

(a) to the operator or the owner of a motor vehicle involved in an accident wherein no injury or damage was caused to the person or property of any one other than such operator or owner;

(b) to the operator or the owner of a motor vehicle legally parked at the time of the accident;

(c) to the owner of a motor vehicle if at the time of the accident the vehicle was being operated without his permission, express or implied, or was parked by a person who had been operating such motor vehicle without such permission; or to the operator if he was a chauffeur or operator employed by the owner of the motor vehicle and was operating with the permission of the owner[.];

(d) if, prior to the date that the director would otherwise suspend license and registration or nonresident's operating privilege under section 3 of this act, there shall be filed with the director evidence satisfactory to him that the person who would otherwise have to file security has been released from liability or been finally adjudicated not to be liable or has executed a duly acknowledged written agreement providing for the payment of an agreed amount in installments, with respect to all claims for injuries or damages resulting from the accident [and with respect to an accident involving an automobile, required to have coverage for personal injury protection benefits pursuant to P.L.1972, c.70, has also reimbursed or executed a duly acknowledged written agreement to pay an agreed amount in installments to reimburse the Unsatisfied Claim and Judgment Fund for the payments it has made or shall make pursuant to section 7 or section 10 of P.L., c. (Assembly Bill No. 803 presently pending in the Legislature) by reason of the failure of such person to have the requisite insurance coverage in effect].

(cf: P.L.1972, c.199, s.2)

7. Section 5 of P.L.1952, c.173 (C.39:6-27) is amended to read as follows:

5. The license and registration and nonresident's operating privilege suspended as provided in section [three] 3 of this act shall remain so suspended and shall not be renewed nor shall any such license or registration be issued to such person until:

(a) such person shall deposit or there shall be deposited on his behalf the security required under said section 3 of this act; or

(b) one year shall have elapsed following the date of such suspension and evidence satisfactory to the director has been filed with him that during such period no action for damages arising out of the accident has been instituted; or

(c) evidence satisfactory to the director has been filed with him of a release from liability, or a final adjudication of nonliability, or a duly acknowledged written agreement, in accordance with section 4(d) of P.L.1952, c.173 (C.39:6-26) [and with respect to an automobile required to have coverage for personal injury protection benefits pursuant to P.L.1972, c.70 has filed evidence satisfactory to the director that he has also met the additional requirements of section 4(d) of P.L.1952, c. 173 (C.39:6-26) pertaining to such automobile]; provided, however, in the event there shall be any default in the payment of any installment under any duly acknowledged written agreement, then, upon notice of such default, the director shall forthwith suspend the license and registration or nonresident's operating privilege of such person defaulting which shall not be restored unless [and until]

(1) such person deposits and thereafter maintains security as required under said section 3 of this act in such amount as the director may then determine; or

(2) one year shall have elapsed following the date when such security was required and during such period no action upon such agreement has been instituted in a court in this State.

Subsections 5(b) and 5(c)(1) of this section shall not apply to amounts in reimbursement of the Unsatisfied Claim and Judgment Fund which remain unpaid after [1] one year.

(cf: P.L.1972, c.199, s.3)

8. Section 8 of P.L.1952, c.173 (39:6-30) is amended to read as follows:

8. Security deposited in compliance with the requirements of this act shall be applicable only to the payment of a judgment or judgments rendered against the person or persons on whose behalf the deposit was made, for damages arising out of the accident in question in a civil action, begun not later than [1] one year after the date of such accident, or within [1] one year after the date of deposit of any security under subparagraph (c) of section 5 of this act, or to the payment in settlement, agreed to by the depositor, of a claim or claims arising out of such accident [or to the reimbursement of the Unsatisfied Claim and Judgment Fund for the payment of personal injury protection benefits pursuant to section 7 or section 10 of P.L., c. (Assembly Bill No. 803 presently pending in the Legislature)]. Such deposit or any balance thereof shall be returned to the depositor or his personal representative when evidence satisfactory to the director has been filed with him that there has been a release from liability, or a final adjudication of nonliability, or a duly acknowledged agreement in accordance with subparagraph (d) of section 4 of this act [, and in the event of an accident involving an automobile required to have coverage for personal injury protection benefits pursuant to P.L.1972, c.70, if the depositor has also met the additional requirements of section 4(d) of P.L.1952, c.173 (C.39:6-26) pertaining to such automobile] or whenever, after the expiration of 1 year (1) from the date of the accident, or (2) from the date of any security under subparagraph (c) of section 5 of this act, the director shall be given reasonable evidence that there is no such action pending and no judgment rendered in such action left unpaid [and no amount in reimbursement, to the Unsatisfied Claim and Judgment Fund for payment of personal injury protection benefits, remains unpaid by such person].

(cf: P.L.1972, c.199, s.4)

9. Section 13 of P.L.1952, c.173 (C.39:6-35) is amended to read as follows:

13. If a person fails to pay and satisfy every judgment rendered against him for damages because of personal injury or death, or damage to property in excess of $500.00, resulting from the ownership, maintenance, use or operation of a motor vehicle and every judgment based on an agreement or contract made in settlement of damages arising out of a motor vehicle accident, within 60 days after its entry, or if an appeal is taken therefrom within that time, within 60 days after the judgment as entered or modified becomes final, the operator's license and all registration certificates of any such person, other than a chauffeur or operator employed by the owner of a motor vehicle and so acting at the time of the damage, injuries or death resulting in the judgment, shall, upon receiving a certified copy of a transcript of the final judgment from the court in which it was rendered showing it to have been still unsatisfied more than 60 days after it became final, be forthwith suspended by the director.

If the director is satisfied that a judgment debtor or his insurance carrier was, within the said 60-day period, ready, willing and able to pay the said judgment but was prevented from so doing by reason of the refusal or legal inability of the judgment creditor to accept payment, or that the failure to pay said judgment within the said 60-day period was due to the act or neglect of the judgment debtor's insurance carrier and not to any fault of the judgment debtor then the director may, in his discretion, extend the 60-day limitation herein prescribed for any reasonable time necessary to complete the formality of payment of the judgment and shall not suspend the judgment debtor's driver's license, operating privilege or certificate of registration.

The judgment herein mentioned shall be a judgment of a court of competent jurisdiction of this State or any other state or of a District Court of the United States.

The license and registration certificates shall remain so suspended and shall not be renewed, nor shall a motor vehicle be thereafter registered in the name of that person while the judgment remains unstayed, unsatisfied, subsisting and until every such judgment is satisfied or discharged, and the person gives proof of financial responsibility to respond in damages for future accidents as required pursuant to section 17 of P.L. , c. (C. )(pending in the Legislature as this bill), except that in the event that the judgment debtor shall be relieved of liability for payment of said judgment by an adjudication of the court in which the same was entered, or if the right to enforce said judgment by docketing and revival, or by revival, or by bringing an action thereon, shall have expired without such revival or the bringing of any such action thereon, the judgment debtor's license shall be restored to him, and one or more motor vehicles may be registered in his name, upon application to the Division of Motor Vehicles.

A discharge in bankruptcy shall relieve the judgment debtor from any of the requirements of this act, except proof of financial responsibility as required pursuant to section 17 of P.L., c. (C. )(pending in the Legislature as this bill), provided that the underlying judgment was not based on a willful or malicious tort.

The clerk of the court in which the judgment is rendered, or the court where it has no clerk, shall forward to the director, at the request of the judgment creditor or his attorney, after the expiration of the 60 days a certified copy of the judgment or a transcript thereof, as aforesaid.

Upon the filing with the court of proof of satisfaction or discharge of a judgment, the nonpayment of which has been previously certified to the director, the clerk of the court, or the court where it has no clerk shall immediately forward notice of such satisfaction or discharge to the director.

If the defendant is a nonresident the director shall transmit to the officer in charge of the issuance of driver licenses and registration certificates of the state of which the defendant is a resident a certified copy of the judgment.

If after proof is given, another such judgment is recovered against that person for an accident occurring before the proof was given, the license and certificate shall again be and remain suspended, and no other license or certificate shall be issued to him while the judgment so remains unsatisfied and subsisting.

(cf: P.L.1988, c.119, s.13)

10. Section 14 of P.L.1952, c.173 (C.39:6-36) is amended to read as follows:

14. While a final judgment against a nonresident motor vehicle owner or operator is so unstayed, unsatisfied and subsisting for more than 60 days, his privilege of operating a motor vehicle, whether owned by him or not, in this State, shall be withdrawn and shall not be renewed. No operator's or chauffeur's license shall be issued to him nor shall a motor vehicle be registered in his name until every such judgment is stayed, satisfied or discharged as herein provided, and he has given proof of financial responsibility to respond in damages for future accidents as required pursuant to section 17 of P.L. , c. (C. )(pending in the Legislature as this bill).

(cf: P.L.1979, c.169, s.2)

11. Section 16 of P.L.1952, c.173 (C.39:6-38) is amended to read as follows:

16. For the purposes of sections [9 to] 13 and 14 of this act and sections 17 through 20 of P.L. , c. (C. )(pending in the Legislature as this bill), when:

(a) $10,000.00 has been credited upon any judgment or judgments rendered in excess of that amount for bodily injury to or the death of [1] one person as the result of [1] one accident;

(b) Subject to the limit of $10,000.00 for [1] one person so injured or killed, the sum of $20,000.00 has been credited upon any judgment or judgments rendered in excess of that amount for bodily injury to or the death of more than [1] one person as the result of [1] one accident; or

(c) $5,000.00 has been credited upon any judgment or judgments rendered in excess of that amount for damage to property as the result of [1] one accident--

Such payment or payments shall be deemed a satisfaction of the judgment or judgments.

(cf: P.L.1958, c.95, s.4)

12. Section 17 of P.L.1952, c.173 (C.39:6-39) is amended to read as follows:

17. A judgment debtor to whom this chapter applies may, for the sole purpose of giving authority to the director to authorize the judgment debtor to operate a motor vehicle thereafter, on due notice to the judgment creditor, apply to the court in which the trial judgment was obtained for the privilege of paying the judgment in installments. The court, in its discretion and without prejudice to any other legal remedies which the judgment creditor may have, may so order, fixing the amounts and times of payment of the installments. The director may, in his discretion, while the judgment debtor is not in default in paying the installments, and upon his giving proof of financial responsibility to respond for future accidents as required pursuant to section 17 of P.L. , c. (C. )(pending in the Legislature as this bill), restore, or refrain from suspending his license or registration certificate or certificates, or either or both of them. The license or certificate or certificates, or either or both or all of them, shall be suspended as hereinbefore provided when the director is satisfied that the judgment debtor has failed to comply with the terms of the court order.

(cf: P.L.1979, c.169, s.4)

13. Section 3 of P.L.1952, c.174 (C.39:6-63) is amended to read as follows:

3. For the purpose of creating and maintaining the fund:

(a) (Deleted by amendment, P.L.1968, c.323, s.3.)

(b) (Deleted by amendment, P.L.1968, c.323, s.3.)

(d) On December 30 in each year, the commissioner shall calculate the probable amount which will be needed to carry out the provisions of this act during the ensuing registration license year. In such calculation, he shall take into consideration the amount presently reserved for pending claims, anticipated payments from the fund during said year, anticipated payments from the fund for medical expenses to be made pursuant to section 2 of P.L.1977, c.310 (C.39:6-73.1), during the two years after said year, anticipated amounts to be reserved for claims pending during said year, amounts transferred to the Division of Motor Vehicles pursuant to section 28 of P.L.1952, c.174 (C.39:6-88) and the desirability of maintaining a surplus over and above such anticipated payments and present and anticipated reserves, such surplus not to exceed the amount actually paid from the fund during the 12 full calendar months immediately preceding the date of calculation. Such probable amount which will be needed to carry out the provisions of this act shall be provided from the estimated fees to be collected in the ensuing year by the Division of Motor Vehicles at the time of registration pursuant to section 25 of P.L. , c. (C. )(pending in the Legislature as this bill), with the remainder to be assessed against insurers for such year's contributions to the fund [. Such probable amount needed] , which assessment shall be initially apportioned on an estimated basis among such insurers in the proportion that the net direct written premiums of each bear to the aggregate net direct written premiums of all insurers [, including the New Jersey Automobile Full Insurance Underwriting Association, created pursuant to P.L.1983, c.65 (C.17:30E-1 et seq.), and the Market Transition Facility created pursuant to section 88 of P.L.1990, c.8 (C.17:33B-11),] during the preceding calendar year as shown by the records of the commissioner as an estimate. Each insurer shall pay the sum so assessed to the treasurer on or before March 31, next following. Such estimated sum shall be subject to adjustment on March 31 next following payment based upon the proportion that the net direct written premiums of each insurer bear to the aggregate net direct written premiums of all insurers [, including the New Jersey Automobile Full Insurance Underwriting Association created pursuant to P.L.1983, c.65 (C.17:30E-1 et seq.), and the Market Transition Facility created pursuant to section 88 of P.L.1990, c.8 (C.17:33B-11),] during the year the estimated assessment was paid as shown by the records of the commissioner.

(e) Whenever any of the provisions of this act concerning the method and sources of assessments on insurers, [including the New Jersey Automobile Full Insurance Underwriting Association, created pursuant to P.L.1983, c.65 (C.17:30E-1 et seq.), and the Market Transition Facility created pursuant to section 88 of P.L.1990, c.8 (C.17:33B-11),] the maximum amounts payable from the fund, eligibility or qualifications of claimants, or amounts to be deducted from payments made from the fund are amended by law, between January 1 and April 30 in any year, the commissioner may, if he deems it necessary, rescind any assessment on insurers, [including the New Jersey Automobile Full Insurance Underwriting Association, created pursuant to P.L.1983, c.65 (C.17:30E-1 et seq.) and the Market Transition Facility created pursuant to section 88 of P.L.1990, c.8 (C.17:33B-11),] made on December 30 of the preceding year. He shall then, within 15 days of the adoption of such amendment, recalculate the probable amount which will be needed to carry out the provisions of this act during the ensuing registration license year, in accordance with the provisions of subsection (d) of this section. If, in his judgment, the estimated balance of the fund at the beginning of the next registration license year will be insufficient to meet such needs, he shall determine the contributions of insurers, if any, in accordance with the provisions of subsection (d) of this section. In the event of a rescission and reassessment subsequent to March 1 in any year, insurers shall pay the sum so assessed, if any, to the treasurer within 90 days of the date of such assessment.

(cf: P.L.1990, c.8, s.85)

14. Section 10 of P.L.1952, c.174 (C.39:6-70) is amended to read as follows:

10. Hearing on application for payment of judgment. The court shall proceed upon such application, in a summary manner, and, upon the hearing thereof, the applicant shall be required to show:

(a) He is not a person covered with respect to such injury or death by any workers' compensation law, or the personal representative of such a person,

(b) He is not a spouse, parent or child of the judgment debtor, or the personal representative of such spouse, parent or child,

(c) He was not at the time of the accident a person (1) operating or riding in a motor vehicle which he had stolen or participated in stealing or (2) operating or riding in a motor vehicle without the permission of the owner, and is not the personal representative of such a person,

(d) He was not at the time of the accident, the owner or registrant of an uninsured motor vehicle, or was not operating a motor vehicle in violation of an order of suspension or revocation,

(e) He has complied with all of the requirements of section 5,

(f) The judgment debtor at the time of the accident was not insured under a policy of automobile liability insurance under the terms of which the insurer is liable to pay in whole or in part the amount of the judgment,

(g) He has obtained a judgment as set out in section 9 of this act, stating the amount thereof and the amount owing thereon at the date of the application,

(h) He has caused to be issued a writ of execution upon said judgment and the sheriff or officer executing the same has made a return showing that no personal or real property of the judgment debtor, liable to be levied upon in satisfaction of the judgment, could be found or that the amount realized on the sale of them or of such of them as were found, under said execution, was insufficient to satisfy the judgment, stating the amount so realized and the balance remaining due on the judgment after application thereon of the amount realized,

(i) He has caused the judgment debtor to make discovery under oath, pursuant to law, concerning his personal property and as to whether such judgment debtor was at the time of the accident insured under any policy or policies of insurance described in subsection (f) of this section,

(j) He has made all reasonable searches and inquiries to ascertain whether the judgment debtor is possessed of personal or real property or other assets, liable to be sold or applied in satisfaction of the judgment,

(k) By such search he has discovered no personal or real property or other assets, liable to be sold or applied or that he has discovered certain of them, describing them, owned by the judgment debtor and liable to be so sold and applied and that he has taken all necessary action and proceedings for the realization thereof and that the amount thereby realized was insufficient to satisfy the judgment, stating the amount so realized and the balance remaining due on the judgment after application of the amount realized,

(l) The application is not made by or on behalf of any insurer by reason of the existence of a policy of insurance, whereby the insurer is liable to pay, in whole or in part, the amount of the judgment and that no part of the amount to be paid out of the fund is sought in lieu of making a claim or receiving a payment which is payable by reason of the existence of such a policy of insurance and that no part of the amount so sought will be paid to an insurer to reimburse or otherwise indemnify the insurer in respect of any amount paid or payable by the insurer by reason of the existence of such a policy of insurance,

(m) Whether or not he has recovered a judgment in an action against any other person against whom he has a cause of action in respect of his damages for bodily injury or death or damage to property arising out of the accident and what amounts, if any, he has received by way of payments upon the judgment, or by way of settlement of such cause of action, in whole or in part, from or on behalf of such other person,

(n) [In order to recover for noneconomic loss, as defined in section 2 of P.L.1972, c.70 (C.39:6A-2) for accidents to which the benefits of sections 7 and 10 of P.L.1972, c.198 (C.39:6-86.1 and C.39:6-86.4) apply, the injured person shall have sustained an injury described in subsection a. of section 8 of P.L.1972, c.70 (C.39:6A-8).] (Deleted by amendment, P.L. , c. .)

Whenever the applicant satisfies the court that it is not possible to comply with one or more of the requirements enumerated in subsections (h) and (i) of this section and that the applicant has taken all reasonable steps to collect the amount of the judgment or the unsatisfied part thereof and has been unable to collect the same, the court may dispense with the necessity for complying with such requirements.

The board or any insurer to which the action has been assigned may appear and be heard on application and show cause why the order should not be made.

(cf: P.L.1988, c.119, s.19)

15. Section 2 of P.L.1977, c.310 (C.39:6-73.1) is amended to read as follows:

2. In the event medical expense benefits paid by an insurer, in accordance with subsection a. of section 4 of P.L.1972, c.70 (C.39:6A-4), are in excess of $75,000.00 on account of personal injury to any one person in any one accident, the Unsatisfied Claim and Judgment Fund shall assume such excess up to $250,000 and reimburse the insurer therefor in accordance with rules and regulations promulgated by the commissioner; provided, however, that this provision is not intended to broaden the coverage available to accidents involving uninsured or hit-and-run automobiles, to provide extraterritorial coverage, or to pay excess medical expenses; and, provided, further, that the provisions of this section shall not apply to the payment of medical expense benefits pursuant to policies issued or renewed on or after the effective date of P.L. , c. (C. )(pending in the Legislature as this bill).

(cf: P.L.1990, c.8, s.14)

16. Section 27 of P.L.1952, c.174 (C.39:6-87) is amended to read as follows:

27. Registration, etc. not restored until fund is reimbursed. Where the license or privileges of any person, or the registration of a motor vehicle registered in his name, has been suspended or cancelled under the Motor Vehicle Security-Responsibility Law of this State, and the treasurer has paid from the fund any amount in settlement of a claim or towards satisfaction of a judgment against that person, [or for the payment of personal injury protection benefits as provided in section 7 and section 10 of this act,] the cancellation or suspension shall not be removed, nor the license, privileges, or registration restored, nor shall any new license or privilege be issued or granted to, or registration be permitted to be made by, that person until he has

(a) Repaid in full to the treasurer the amount so paid by him together with interest thereon at 8% per annum from the date of such payment; and

(b) Satisfied all requirements of said Motor Vehicle Security-Responsibility Law in respect of giving proof of ability to respond in damages for future accidents, provided, that the court in which such judgment was rendered may, upon 10 days' notice to the board, make an order permitting payment of the amount of such person's indebtedness to the fund, to be made in installments [, or in the event the fund makes personal injury protection benefit payments, such person and the fund by agreement may provide for repayment to the fund to be made in installments,] and in such case, such person's driver's license, or his driving privileges, or registration certificate, if the same have been suspended or revoked, or have expired, may be restored or renewed and shall remain in effect unless and until such person defaults in making any installment payment specified in such order. In the event of any such default, the Director of the Division of Motor Vehicles shall upon notice of such default suspend such person's driver's license, or driving privileges or registration certificate until the amount of his indebtedness to the fund has been paid in full.

(cf: P.L.1985, c.148, s.20)

17. (New section) The director shall require as proof of financial responsibility a policy of insurance providing coverage of at least an amount or limit of $15,000, exclusive of interest and costs, on account of injury to, or death of, one person, in any one accident; an amount or limit, subject to such limit for any one person so injured or killed, or $30,000, exclusive of interest and costs, on account of injury to or death of, more than one person, in any one accident; and an amount or limit of $5,000, exclusive of interest and costs, for damage to property in any one accident.

Whenever the director shall require proof of financial responsibility from the owner of an automobile he shall require proof in the amounts specified for each vehicle owned or registered by that person. Pursuant to regulations promulgated by the director, the insurer providing the policy of insurance shall notify the Division of Motor Vehicles of the issuance, nonrenewal and termination of the policy.

18. (New section) If a person fails to maintain proof of financial responsibility as required by section 17 of P.L. , c. (C. )(pending in the Legislature as this bill), the director shall, until proof is furnished, suspend or revoke the license of that person to operate a motor vehicle or refuse to return a license which is suspended or revoked, or suspend or revoke the registration of a motor vehicle, or refuse to register a motor vehicle transferred by him, if it shall not appear to the director's satisfaction that the transfer is a bona fide sale, or if a person is not a resident of this State, withdraw his privilege of operating a motor vehicle in this State and the privilege of operation within this State of a motor vehicle owned by him.

No appeal taken from the judgment of a court shall act as a stay of an action of the director authorized by this act.

The director may suspend or revoke the license of a person or the registration of a motor vehicle if proof of financial responsibility is not furnished or if a person's license or registration is suspended or revoked in any other state.

19. (New section) A person subject to the requirements of the "Motor Vehicle Security-Responsibility Law," P.L.1952, c.173 (C.39:6-23 et seq.), and not the owner of the motor vehicle may operate a motor vehicle when he or the owner of the motor vehicle has furnished acceptable proof of financial responsibility to the director.

Unless an operator who is not the owner files acceptable proof, his license shall be restricted to operating only the motor vehicles for which the owner has filed proof of financial responsibility.

In the event that person is a nonresident, his operating privilege in this State shall be limited to only those motor vehicles for which the owner has furnished to the director acceptable proof of financial responsibility.

20. (New section) The director shall, upon written request, furnish a person who sustained personal injury or property damage from a motor vehicle, with information concerning the financial responsibility of the operator or owner of that motor vehicle.

21. (New section) An operator or registrant whose operator's license or registration certificate, or both, are suspended pursuant to the "Motor Vehicle Security-Responsibility Law," P.L.1952, c.173 (C.39:6-23 et seq.), or whose policy of liability insurance, as required thereunder, has been terminated, shall immediately return to the director his operator's license or registration certificate and the number plates issued thereunder. If a person fails to return these items, the director shall direct any member of the State Police, motor vehicle inspector or other police officer to secure possession of these items and return them to the director's office.

22. (New section) The director may cancel the requirement that a person maintain liability coverage, as provided in section 17 of P.L., c. (C. )(pending in the Legislature as this bill), if three years have elapsed since the date of suspension or revocation of the license or registration, and if no right of action or judgment arising out of the ownership, maintenance, operation or use of a motor vehicle is then outstanding against him and remains unpaid by that person.

23. (New section) A policy of insurance furnished as proof of financial responsibility as provided in section 17 of P.L. , c. (C.) (pending in the Legislature as this bill) shall be a policy of liability insurance issued by an insurance carrier authorized to transact business in this State; or in the case of a person who is not otherwise able to purchase insurance from an insurance carrier, issued by an eligible surplus lines insurer to the person therein named as insured; or in the case of nonresident, issued by an insurance carrier authorized to transact business in any of the states of the United States. The policy shall:

a. Designate, by explicit description or appropriate reference, all motor vehicles covered by the policy, and insure the named insured and any other person using or responsible for the use of a motor vehicle with the express or implied consent of the insured, against loss from the liability imposed upon the insured or other person by law, for injury to or death of a person, other than a person who is covered for injury or death, by any workers' compensation law, or damage to property, except property of others in charge of the insured or the insured's employees, growing out of the maintenance, use or operation of the motor vehicle in the United States of America; or,

b. In the alternative, insure the named insured against loss from liability imposed by law for injury to or death of a person, other than a person who is covered for injury or death by any workers' compensation law, or damage to property, except property of others in charge of the insured or the insured's employees, growing out of the operation or use by the insured of a motor vehicle except a motor vehicle registered in the name of the insured, and occurring while the insured is personally in control, as driver or occupant, of the motor vehicle within the United States of America.

The policy shall insure to at least the minimum limits provided for in section 17 of P.L. , c. (C. )(pending in the Legislature as this bill), or a binder pending the issuance of any policy, or an endorsement to an existing policy as hereinafter provided.

This section shall not be construed as preventing the insurance carrier from granting lawful coverage in excess of or in addition to the minimum coverage, nor from embodying in the policy any agreement, provision or stipulation not contrary to the provisions of P.L.1952, c.173 (C.39:6-23 et seq.) or other laws.

24. (New section) In the case of a nonresident, a policy of insurance as required in section 17 of P.L. , c. (C. )(pending in the Legislature as this bill) and issued by an insurance carrier authorized to transact business in the state in which the motor vehicle is registered or primarily garaged shall be considered sufficient if the carrier:

a. executes a power of attorney authorizing the director to accept service of notice or process in an action arising out of a motor vehicle accident in this State;

b. by its governing executive authority, duly adopts a resolution providing that its policies shall be deemed to be varied to comply with the law of this State relating to the terms of motor vehicle liability policies issued; and

c. agrees to accept as final and binding any final judgment duly rendered in an action arising out of a motor vehicle accident in a court of competent jurisdiction of this State.

This section shall apply to insurance carriers organized and existing under the laws of any other state and not licensed to transact business in this State to the extent and under the same terms and conditions that the laws of the state where the motor vehicle is registered or in which the insured resides recognize certificates of insurance carriers organized and existing under the laws of this State.

25. (New section) a. A person registering an automobile, as defined in section 1 of P.L.1972, c.197 (C.39:6B-1), on or after the effective date of P.L. , c. (C. )(pending in the Legislature as this bill), without liability insurance coverage in the amounts required under section 17 of P.L. , c. (C. )(pending in the Legislature as this bill), shall, in addition to any other fees required by law, pay to the Division of Motor Vehicles a fee of $150 at the time of registration of the motor vehicle. All moneys collected pursuant to this section by the director shall be remitted to the State Treasurer, in accordance with section 28 of P.L.1952, c.174 (C.39:6-88), for use by the Unsatisfied Claim and Judgment Fund. The board of the Unsatisfied Claim and Judgment Fund shall determine, by regulation, no later than January 1 of each calendar year, the amount of the fund charge for each registration year subsequent to the initial registration year.

b. The Division of Motor Vehicles shall refuse registration or renewal or transfer of registration to the owner of any automobile for which the fund charge is not paid.

26. (New section) Notwithstanding the provisions of any other law to the contrary, the doctrine of contributory negligence shall apply to all motor vehicle accidents.

27. (New section) This act shall be known and may be cited as the "Automobile Insurance Reform Act of 1997."

28. The following acts or parts of acts are repealed:

sections 24 through 33 inclusive and section 51 of P.L.1990, c.8 (C.17:33B-13 through 17:33B-22, inclusive, and 17:33B-42);

sections 7 through 12 of P.L.1972, c.198 (C.39:6-86.1 through C.39:6-86.6, inclusive);

P.L.1972, c.70 (C.39:6A-1 et seq.);

sections 9 through 11 inclusive of P.L.1972, c.203 (C.39:6A-19, 39:6A-20 and 39:6A-13.1);

section 1 of P.L.1983, c.212 (C.39:6A-4.1);

sections 12, 13, 14.1, 18, 19 and 20 of P.L.1983, c.362 (C.39:6A-4.2, 39:6A-4.3, 39:6A-8.1, 17:29A-15.1, 17:28-1.3, and 39:6A-9.1);

section 17 of P.L.1983, c.362 (39:6A-23);

section 4 of P.L.1984, c.40 (C.39:6A-4.4);

section 14 of P.L.1985, c.520 (C.39:6A-4.5);

section 10 of P.L.1988, c.119 (C.39:6A-4.6) and

section 14 of P.L.1988, c.156 (C.17:29A-15.2).

29. This act shall take effect on the 180th day after enactment.

STATEMENT

This bill repeals the no-fault law and compulsory automobile liability insurance for automobiles.

The bill requires motorists choosing not to carry automobile liability insurance to pay a fee of $150 into the Unsatisfied Claim and Judgment Fund. Such fees would be applied toward reimbursing individuals who are injured by an uninsured driver.

Under the provisions of the bill, if a driver without liability coverage has an accident, the driver must then provide evidence of financial responsibility in the form of a policy of automobile liability insurance coverage in an amount or limit of at least $15,000/$30,000/$5,000 if the driver cannot meet his financial responsibility for the accident.

The bill requires that the doctrine of contributory negligence apply to all motor vehicle accidents.

Finally, the bill repeals various provisions of law with respect to compulsory automobile liability insurance and the no-fault law.

Eliminates compulsory liability and no-fault automobile insurance; reinstates financial responsibility laws; uses doctrine of contributory negligence in motor vehicle accidents.