New Jersey Driver With New York Auto Policy Considered To Be Uninsured And Barred From Pursuing Personal Injury Claim

Plaintiff Adam Haber was involved in an automobile accident with the defendant Faith Geruldsen on March 7, 2019.  At that time, plaintiff resided in New Jersey with his car garaged in New Jersey but he had a New York auto insurance policy.  The issue in Haber v. Geruldsen, 2021 N.J. Super. Unpub. LEXIS 2943 (App. Div. Dec. 3, 2021) was whether plaintiff’s personal injury claim from the automobile accident was statutorily barred because he had a New York insurance policy and, hence, would considered to be “culpably” uninsured on the date of the accident. If he was uninsured, by statute, he would not be entitled to make a claim for personal injuries suffered in the auto accident.

Plaintiff’s automobile insurance policy was issued by State Farm.  Plaintiff claimed that State Farm knew he had relocated to New Jersey in 2017 because State Farm sent insurance premium bills to his New Jersey address.  However, the declaration page for the State Farm policy expressly indicated that the plaintiff’s New York address was used to determine the rate charged.  The notice stated that the amount charged would be “determined by many factors such as the coverages you have, where you live, the kind of car you drive, how your car is used, who drives the car, and information from consumer reports.” 

In December 2019, Haber sued the defendant Geruldsen to recover for damages from the personal injuries he suffered in the March 2019 accident.  Thereafter, the defendant filed a motion for summary judgment, claiming that plaintiff failed to insure his vehicle pursuant to N.J.S.A. 39:6A-4, which rendered him “culpably” uninsured under N.J.S.A. 39:6A-4.5(a).  Plaintiff opposed that motion, arguing that he was not uninsured because his vehicle was insured under a New York policy. 

The trial court judge granted the motion for summary judgment, dismissing the lawsuit.  The judge found that plaintiff’s vehicle was continuously and principally garaged in the State of New Jersey for over one year and plaintiff failed to obtain personal injury protection insurance coverage through a New Jersey policy, as obligated under New Jersey law.  Instead, plaintiff obtained coverage through a New York policy through State Farm Insurance Company.  Thus, the judge found that under N.J.S.A. 39:6A-4.5, the plaintiff had “no cause of action for recovery of non-economic [loss] sustained as the result of an accident while operating an uninsured automobile.”

The judge noted that N.J.S.A. 39:6B-1 required that all owners of vehicles registered or principally garaged in New Jersey had to maintain a minimum amount of standard, basic, or special liability insurance coverage for bodily injury, death and property damage caused by their vehicle.  The judge dismissed the plaintiff’s complaint based upon a law which precluded recovery of economic and non-economic damages for drivers not insured in accordance with N.J.S.A. 39:6A-4.5.

The plaintiff appealed this dismissal to the Appellate Division.  The plaintiff argued that his vehicle was fully insured under a New York automobile insurance policy issued by State Farm and, hence, fulfilled the coverage requirements to be fully insured under New Jersey law.  The Appellate Division rejected that argument. 

The Court found that “there is no statutory provision allowing a New Jersey resident with a vehicle principally garaged in New Jersey to procure ‘equivalent’ insurance from another state.”  Further, the Appellate Division pointed out that to accept plaintiff’s argument “would invite potential insurance fraud and encourage drivers residing in New Jersey to obtain insurance policies from other states offering lower insurance rates despite the policy holder having no connection with the state issuing the insurance policy.” 

The Appellate Division reviewed the New York automobile insurance policy and it revealed various coverage differences from the New Jersey’s automobile insurance law. Because plaintiff was subject to various coverage provisions under the New York policy that are not authorized in New Jersey, the Appellate Division found that plaintiff could not rely on purchasing equivalent insurance to allow him to pursue claims for economic and non-economic damages in New Jersey as a result of an automobile accident.

The plaintiff’s automobile insurance premiums were calculated based upon his address in Piermont, New York and reflected the demographic information relevant to a car garaged in New York.  There was no evidence that the New York issued State Farm policy contained provisions approved by New Jersey’s Commissioner of Banking and Insurance.  Further, the Court pointed out that the plaintiff’s automobile insurance premiums funded a New York insurance pool and he never contributed to the New Jersey Automobile Liability Insurance Pool. 

Finally, the Appellate Division found that allowing the plaintiff to recover for injuries under these circumstances would be “contrary to the Legislature’s stated purpose in enacting automobile insurance laws designed specifically to reduce insurance costs to New Jersey’s drivers and alleviate the burden on New Jersey’s courts.”  Thus, the Appellate Division was satisfied that the trial court judge correctly concluded that the plaintiff failed to satisfy the requirements of N.J.S.A. 39:6A-4.5(a), rendering plaintiff culpably uninsured.  Hence, the trial court judge correctly dismissed the plaintiff’s complaint on summary judgment.

Tags: automobile insurance