Alliance Hails NJ Supreme Court Denial of Appeal in James Case; Reaffirms AICRA Threshold

March 17, 2003

The Alliance of American Insurers announced its satisfaction in the outcome of a recent decision by the New Jersey Supreme Court to deny certification in James v. Torres.

The bulletin noted that the result “will bring a needed sense of stability to the state’s insurance market and help battle the over-utilization that permeates the system today.”

“As a result of the Supreme Court’s decision, the Nov. 6, 2002, decision of the New Jersey Appellate Division will stand,” said the Alliance. “That decision held that an injury must be both permanent and serious to permit a plaintiff to cross the verbal threshold contained in the Automobile Insurance Cost Reduction Act (AICRA).”

“This decision is a clear victory for personal auto insurers doing business in New Jersey, and is consistent with prior judicial interpretations of AICRA,” stated Richard Stokes, government affairs representative for the Alliance’s Northeast Region.

“There are two important aspects to this case,” Stokes continued. “First, the Supreme Court’s decision is consistent, because it adopts an earlier court’s methodology for analyzing questions presented under the verbal threshold statute. Secondly, the decision reaffirms AICRA and the legislature’s intent that an injury be both permanent and serious to permit a plaintiff to cross the amended verbal threshold.”

The Alliance noted that the decision “will help reduce the over-utilization, abuse and fraud in New Jersey’s auto insurance system that steals virtually hundreds of dollars out of the pockets of state consumers.”

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