Did I restrict my rights on my automobile insurance policy?

Paul Sochanchak, Lundy Law Managing Partner of our New Jersey Office, answers this tricky question.

“In New Jersey, when you obtain automobile insurance, you are required to make a Tort Threshold selection, either No Limitation on Lawsuit Threshold or Limitation on Lawsuit Threshold.  This is an extremely important decision.  Yet most people are not aware of the serious consequences the selection of the Limitation on Lawsuit Threshold will have on their right to pursue a claim, if injured in a motor vehicle collision.  In exchange for receiving a relatively small discount on your insurance premium, the Limitation on Lawsuit Threshold severely restricts an injured person’s rights to make a claim for pain and suffering.

In fact, this Threshold will bar you from recovering any non-economic loss, unless your injuries fall within one of six (6) narrow categories:   1) Death; 2) Dismemberment; 3) Loss of fetus; 4) Significant disfigurement or scarring; 5) Displaced fractures; 6) Permanent Injury within a reasonable degree of medical probability, other than scarring or disfigurement.  Additionally, this restriction not only applies to you, but applies to your immediate family members (spouse, children and step-children) living in your household. So, yes, you can be in an automobile collision, not at fault, in pain from your injuries, and barred from being compensated for your injuries from the person who caused them.

While it is more expensive, I strongly suggest you select the No Limitation on Lawsuit Threshold.  This will protect your rights and the rights of your immediate family members.  With this Threshold, you can be compensated for all of your injuries sustained in an automobile collision.  Also, when asking for the No Limitation on Lawsuit Threshold, make sure you are given an actual dollar amount of the cost (not a percentage range) to have the right to sue, so you can make an informed decision.”

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