To view a pdf file of this article with photos, click HERE.
At the NORTHEAST show I was able to talk to Charles Bryant of AASP-NJ and ask him what’s going on in NJ in general. Here’s what he told me:
There is always something interesting going on in New Jersey. First, we are proud that the NJ-MVC has abandoned the proposal to license Mobile Auto Body shops in our state. That was a battle that took over two years to accomplish.
Another real exciting thing is new proposed legislation that would force insurers to follow the regulations that govern fair claim settlement practices or face serious consequences. Currently, a one-time violation of the NJ Unfair Claim Settlement Practices Act is not considered a violation of the act until it is established through what is referred to as a market conduct survey, that the insurer has violated the act with enough frequency to create a general business practice.
Then, even when it has been established that the insurer has violated the act with enough frequency to create a general business practice all that can happen is the NJ-DOBI can fine the insurer, if they choose to do so. To make things worse, a violation of the NJ Unfair Claim Settlement Practices Act does not state a cause of action upon which relief may be granted by civil action.
As such, the act basically has no teeth and allows insurers to violate the provisions of the act without fear of any serious repercussions. In essence, the act gives the consumer a false sense of security and an unjustified feeling that the insurers have a set of rules that they must follow.
If passed, these bills would allow an insured, claimant or the assignee of the insured to file a civil action in a court of competent jurisdiction against an insurer for any single violation of the NJ Unfair Claim Settlement Practices Act even though the insurer did not violate any provision of the act with enough frequency as to indicate a general business practice. In other words, it would make a one-time violation a valid violation.
Upon establishing that (a) violation of the provisions of the Unfair Claim Settlement Practices Act has occurred, the claimant shall be entitled to the following:
● The full amount of damages as set forth in the final judgment (regardless of the coverage limits of the policy)
● Prejudgment interest
● Reasonable attorney’s fees
● All reasonable litigation expenses from the date of the institution of the action filed
● Punitive damages, when the insurer’s acts or omissions demonstrate, by clear and convincing evidence, actual malice or wanton and willful disregard of any person who foreseeably might be harmed by the insurer’s acts or omissions
The provisions of the bill intend to incorporate into statutory law certain aspects of New Jersey’s current case law, which recognize private causes of action in first-party and third-party claims regarding the bad faith actions of insurance companies which result in harm to their insureds. See Pickett v. Lloyd’s, 131 N.J. 457 (1993), Samuel v. Doe, 158 N.J. 134 (1999), Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474 (1974).
Although the prospect of this legislation passing sounds great, the might and power of the insurance industry to fight such a proposal makes it extremely hard to get this type of legislation passed. However, because of the abuse of New Jersey residents harmed by Hurricane Sandy by certain insurers, it has a much better chance to get legs. Therefore, we are keeping a close watch on this legislation and ready to fight for the passage of it if it looks like there is a realistic chance of actually passing.
We have two great training meetings planned for April of this year and more meetings in the planning stage.
The AASP/NJ Lou Scoras Memorial Golf Outing is coming up on May 20, 2013 and we are already getting players and sponsors signing up.
I could go on and on because new things are always happening here in New Jersey. However, I think this will give you a pretty good idea of the highlights for now. Thank you for giving me the opportunity.
Jeff McDowell added that like the rest of the country, shops in his region are examining the benefits and costs of assignments of proceeds and parts procurement programs, amongst other general industry concerns.