New insurance regulations for New Jersey drivers

New Jersey Auto InsuranceNew Jersey is considering a massive change to the regulations for the personal injury element of auto insurance, with the intention of keeping rate increases under control.

The primary changes have to do with the ways in which a doctor will be permitted to bill for the treatments provided, and will recreate the way in which a claim that has been denied can be appealed.

While New Jersey has maintained its status among the more costly states in which to buy car insurance, its residents are paying lower premiums following former Governor James McGreevey’s changes, which were enacted in 2003 in order to encourage competition. However, more recently, rates have been climbing upward once more and officials are blaming personal injury expenses.

According to the Department of Banking and Insurance in New Jersey, in 2010, 97% of all rate increases were a direct result in an alarming increase in the personal injury claims being paid out. It also stated that $1.23 was being spent by insurers for benefits for every dollar that they made for personal injury premiums.

State regulators are hoping that these new rules will help to slow or stop these escalating premiums.

According to Thomas Considine, the insurance commissioner for the state, too many loopholes are permitting doctors to bill for a greater amount than the listed rate. He explained that a small percentage of the doctors in the state had “found ways to abuse and take advantage of the system, and really have an unfair and inequitable way of drawing down New Jersey’s coverage dollars”.

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