Key Takeaway
New Jersey's strict insurance compliance requirements bar claims when drivers fail to maintain state-approved coverage, highlighting jurisdictional challenges in auto accident cases.
Auto insurance requirements vary significantly from state to state, creating complex jurisdictional challenges for drivers and attorneys alike. New Jersey maintains particularly strict standards for automobile liability insurance, requiring specific coverage amounts and state-approved policies. When drivers fail to comply with these requirements, the consequences can be severe—including complete bars to recovery even after suffering injuries in an accident.
A recent New Jersey appellate case illustrates just how unforgiving these insurance compliance rules can be, particularly for drivers who attempt to use out-of-state policies that don’t meet New Jersey’s standards. The case serves as a stark reminder that insurance fraud or non-compliance doesn’t just risk policy cancellation—it can eliminate legal remedies entirely. This type of jurisdictional issue demonstrates why understanding state-specific insurance requirements is crucial for both drivers and their legal counsel.
Jason Tenenbaum’s Analysis:
JEFFREY E. SCHOLES VS. STEPHEN M. HAUSMANN, ET AL, A-0980-17T3 (N. J. App. Div. 2018)
“Since plaintiff primarily garaged his vehicle in New Jersey, he was required to maintain automobile liability insurance coverage under provisions approved by the Commissioner, including mandatory medical expense benefits coverage of $15,000 per person. As noted by the judge, “the Deemer Statute cannot save the laintiff’s failure to obtain an insurance policy approved by the State of New Jersey.” Plaintiff had a Florida insurance policy that the Commissioner did not approve, and the policy did not provide medical expense benefits coverage of $15,000 per person. Consequently, N.J.S.A. 39:6A-4.5(a) bars plaintiff’s cause of action for recovery of economic and non-economic
damages sustained as a result of the accident”
I wish we had this statute in New York.
Key Takeaway
New Jersey’s insurance compliance statute N.J.S.A. 39:6A-4.5(a) completely bars accident victims from pursuing any damages—both economic and non-economic—when they fail to maintain state-approved insurance coverage. This creates a powerful deterrent against insurance fraud and ensures drivers cannot benefit from non-compliant policies, even when they become accident victims themselves.
