What Happens When a Car Accident Claim Exceeds Insurance Limits in New Jersey?

Just imagine this: You are in a car accident. This car accident leads to a spinal injury that prevents you from working in the warehouse you are employed at, while also saddling you with $150,000 worth of medical bills.

You file a claim with your insurance. But, there’s a problem: your policy limit is $15,000. This means that you have to pay $135,000 worth of medical bills, which is something you are unable to do.

If you are in a situation like this, then keep reading. You’ll learn what your options are. And, if you want to move forward with a personal injury lawsuit, call the Rosengard Law Group at 856-284-6446 or Contact Us.

How Do Insurance Limits Affect Car Accident Claims in New Jersey?

In New Jersey, drivers are required to carry Personal Injury Protection (PIP) coverage, which means that your own insurance company pays for your medical expenses and certain other losses, regardless of who was at fault in the accident.

PIP coverage pays for your medical expenses after an accident, up to your policy limits, regardless of fault. But as we mentioned above, your policy limits may not come close to the compensation you need to recover.

And under New Jersey law, you have a limited right to sue unless your Injuries meet Specific Thresholds, such as significant disfigurement, fracture, loss of a body part, or other permanent injuries. 

When purchasing auto insurance, however, you can select a policy with an unlimited right to sue, allowing you to pursue compensation for pain and suffering regardless of injury severity.

In other words, you pursue compensation from your own insurance company — at first.

But if your damages exceed the amount of your policy limit, you may be able to pursue a claim against an at-fault driver, especially when your damages exceed your own policy limits or meet certain legal thresholds.

What Should You Do if Your Car Accident Claim Exceeds Insurance Limits in New Jersey?

Even in a no-fault state like New Jersey, situations arise where:

• Serious injuries occur. If your injuries are severe and meet the legal thresholds, you can step outside the no-fault system and file a personal injury lawsuit against the at-fault driver.
• Economic damages exceed PIP limits. PIP coverage has limits, and severe accidents can quickly exhaust these, leaving you with unpaid expenses.
• You suffer non-economic damages. PIP doesn’t cover non-economic damages like pain and suffering unless you have the unlimited right to sue or your injuries meet the serious injury threshold.

When your situation sounds like one of those above, you may need to explore additional legal options. Some of the most common alternative options are outlined below:

Suing the At-Fault Driver

You may be able to file a lawsuit to pursue the at-fault driver’s personal assets to cover the remaining damages. 

Collecting from personal assets can be difficult if the driver lacks sufficient resources, however. And in many cases, the driver’s insurance may not cover the full extent of your damages.

Underinsured Motorist (UIM) Coverage

UIM coverage on your insurance policy can help cover the gap when the at-fault driver’s insurance isn’t enough.

After exhausting the at-fault driver’s insurance, you may be able to file a claim with your insurer under your UIM coverage.

Identifying Other Liable Parties

There may be other parties responsible, such as employers (if the driver was working), vehicle owners, or manufacturers (in case of a vehicle defect). Identifying additional liable parties can provide more sources from which to recover damages. 

However, understanding where to look for these additional parties is quite difficult. And that is why so many people in your situation choose to hire a New Jersey car accident attorney.

Hire an Attorney or Go It Alone?

Our state’s car accident and auto insurance is — in a word — complicated. And navigating the complexities of New Jersey’s no-fault insurance laws and pursuing compensation beyond policy limits can be more than challenging. 

That’s why it’s a good idea to consider working with an attorney rather than pursuing compensation on your own — particularly if your car accident claim exceeds insurance limits.

An experienced personal injury attorney can:

• Assess your case. Determine if your injuries meet the threshold to step outside the no-fault system.
• Maximize compensation. Explore all avenues to ensure you receive full compensation for both economic and non-economic damages.
• Handle communications. Manage dealings with insurance companies to protect your rights.
• Pursue additional parties. Identify and pursue other liable parties to increase potential recovery.

What Happens When a Car Accident Claim Exceeds Insurance Limits in NJ? We Can Help You Understand Your Options

Have questions about your car accident claim in New Jersey’s no-fault system? We’re here to provide answers and the help you need.

Contact Rosengard Law Group today to schedule your free consultation. Call us at 856-284-6446 or reach out online to speak with a knowledgeable attorney who can help you navigate New Jersey’s insurance laws and pursue maximum compensation. If you’re in Cherry Hill, hire a trusted Cherry Hill auto attorney to ensure your rights are protected every step of the way.