NJ Underinsurance

[b2sunrise]

I had an accident and my car was partially damaged. I was making a U turn on a green arrow, and this car (Car A) broke the red light from oncoming side and hit my car (probably texting). The same car who hit mine also hit another vehicle that was parked on the curb (CarB). Insurance for Car A (Geico A) accepted liability and agreed to pay me and car B pro-rated share from their 5000$ insurance limit. My share comes to $1400, however my expense was $3800, they sent me a release letter for $1400.

This in state of NJ, so we have to have under insured coverage, and claim the remainder $2400 from that. However my under insured coverage is $5000 which my insurance company says does not apply since it is same as the coverage for insurance of car A.

Should i sue the owner of Car A? if I do that does the release for $1400 from insurance A still hold good till the lawsuit is complete? Unfortunately my insurance and insurance of car A is the same, and they don't provide straight answers. It almost feels like they are conspiring to pay as little money as possible.

Or should I sue my insurance since they are denying my underinsurance claim, stating it does not apply as the at fault driver has same coverage as my underinsurance coverage? My arguement is that even if she does, the applicable portion of her limit to mine is not the same.

 

[ALawyer]

You have a claim against the negligent driver for the full value of your damages -- and don't have to stop at the $1,400 you received from Geico (even though that is all Geico will pay) unless of course you signed a general release running in favor of the driver when accepting the $1,400 from Geico -- it all depends on what the release you signed says. If it doesn't waive rights for the remainder of the damages, you could go to small claims court and get a judgment for the remaining $2,400 plus court costs against the driver and then try to collect.

If you had collision coverage, your insurance company would have paid the full costs to fix your car (less any deductible) and then gone after the other driver's insurance coverage fo reimbursement -- making your life much easier -- and if it could it would also then cover your deductible. My recollection is that NJ has a very low required dollar limit for auto insurance so that %,00 property damage limit covers all property damage, and Geico seemingly did the right thing when it apportioned liability.

As for your carrier's underinsurance posture -- I am skeptical that you are getting the right answer but as I am not up-to-date on how NJ law or the under-insurance policy provisions work I suggest that you get a letter in writing from your insurer and then write to the NJ Commissioner of Insurance and pose the question, with a copy of the letter from your carrier.

 

[adjusterjack]

I suggest that you get a letter in writing from your insurer and then write to the NJ Commissioner of Insurance and pose the question, with a copy of the letter from your carrier.

Or, the OP can just read the Underinsured Motorists form that is part of his policy. The form contains an explanation of how the limits work.

Or, the OP can just read what the NJ Department of Banking and Insurance says on its website:

You are only eligible to receive reimbursement of underinsured motorist benefits if your Underinsured Motorist Coverage limits are higher than the Liability Coverage limits of the other driver.

https://www.state.nj.us/dobi/ins_ombudsman/wysk3.htm

 

[b2sunrise]

Thank you
ALawyer
and

You have a claim against the negligent driver for the full value of your damages -- and don't have to stop at the $1,400 you received from Geico (even though that is all Geico will pay) unless of course you signed a general release running in favor of the driver when accepting the $1,400 from Geico -- it all depends on what the release you signed says. If it doesn't waive rights for the remainder of the damages, you could go to small claims court and get a judgment for the remaining $2,400 plus court costs against the driver and then try to collect.

If you had collision coverage, your insurance company would have paid the full costs to fix your car (less any deductible) and then gone after the other driver's insurance coverage fo reimbursement -- making your life much easier -- and if it could it would also then cover your deductible. My recollection is that NJ has a very low required dollar limit for auto insurance so that %,00 property damage limit covers all property damage, and Geico seemingly did the right thing when it apportioned liability.

As for your carrier's underinsurance posture -- I am skeptical that you are getting the right answer but as I am not up-to-date on how NJ law or the under-insurance policy provisions work I suggest that you get a letter in writing from your insurer and then write to the NJ Commissioner of Insurance and pose the question, with a copy of the letter from your carrier.

Thank you! Much appreciated.

 

[b2sunrise]

Or, the OP can just read the Underinsured Motorists form that is part of his policy. The form contains an explanation of how the limits work.

Or, the OP can just read what the NJ Department of Banking and Insurance says on its website:



https://www.state.nj.us/dobi/ins_ombudsman/wysk3.htm

The law is unclear about when Coverage Limits of driver are applied as a pro-rata. Intent of undreinsurance is to be a second layer of protection thus allowing lower mandatory property damage limits. I wish there would have been more clarity in this.