ORDER NO. A02-130

 

STATE OF NEW JERSEY

DEPARTMENT OF BANKING AND INSURANCE

 

IN THE MATTER OF THE "LAST CHANCE" )

PROGRAM: AMENDMENTS TO THE ) ORDER

RATING MANUAL FOR THE PERSONAL )

AUTOMOBILE INSURANCE PLAN )

This matter having been opened by the Commissioner of Banking and Insurance ("Commissioner") pursuant to N.J.S.A. 17:1-15, 17:29A-1 et seq. and 17:29D-1, N.J.A.C. 11:3-2, and all powers expressed or implied herein; and

IT APPEARING that pursuant to N.J.S.A. 39:6B-1 et seq., owners or registrants of motor vehicles registered or principally garaged in this State are required to maintain motor vehicle liability insurance as required by law; and

IT FURTHER APPEARING that recent accounts indicate that there are approximately 600,000 uninsured motorists in this State; and that the existence of uninsured motorists ultimately increases costs to policyholders and the market in general; and

IT FURTHER APPEARING that it is reasonable and appropriate to encourage motorists currently uninsured to obtain required automobile insurance before additional penalties for driving without required insurance are imposed; and

IT FURTHER APPEARING that N.J.S.A. 17:33B-13 and N.J.A.C. 11:3-34.4 defines what constitutes an eligible person for automobile insurance in the voluntary market; and

IT FURTHER APPEARING that applicants for insurance and insureds who do not meet the definition of an eligible person can obtain insurance through the New Jersey Personal Automobile Insurance Plan ("PAIP"); and

IT FURTHER APPEARING that pursuant to N.J.A.C. 11:3-34.4(a)8 a person who, within the previous three years, accumulates nine or more automobile insurance eligibility points does not meet the definition of an eligible person; and

IT FURTHER APPEARING that pursuant to N.J.A.C. 11:3-34-Appendix, a person receives nine eligibility points for a conviction of operating a motor vehicle without liability insurance; and

IT FURTHER APPEARING that pursuant to N.J.A.C. 11:3-34.4(a)6 a person whose automobile insurance policy has been cancelled for non-payment of premium or financed premium with a lapse of at least 30 days, within the immediately preceding two-year period, does not meet the definition of an eligible person; and

IT FURTHER APPEARING that the PAIP rating manual provides for the assessment of nine penalty points for applicants with a conviction for driving without compulsory liability insurance and one penalty point for applicants who have a lapse of coverage of at least 30 days; and

IT FURTHER APPEARING that each penalty point imposed results in a surcharge of $115.00 for the mandatory insurance coverages and $26.00 and $13.00 respectively for collision and comprehensive coverages; and

IT FURTHER APPEARING that it is reasonable and appropriate to amend the PAIP rating manual to provide for the writing of individuals, who are uninsured as of the effective date of this Order and who either have been convicted of operating a motor vehicle without required liability insurance or who have been cancelled for non-payment of premium or financed premium with a lapse of coverage of at least 30 days within the immediately preceding two year period, through the PAIP without imposition of penalty points solely for those violations.

THEREFORE IT IS on this 6th day of September 2002 ORDERED that

1. The "Last Chance" program is created in PAIP. It shall begin with coverage bound on September 16, 2002 and shall end on December 31, 2002 and shall include the renewals of policies written under the program; and

2. PAIP shall immediately make appropriate revisions to its rating manual to not impose penalty points on individuals who were uninsured as of September 16, 2002, and who are eligible for PAIP because they have either been convicted of operating a motor vehicle without required liability insurance or who have been cancelled for non-payment of premium or financed premium with a lapse of coverage of at least 30 days within an immediately preceding two-year period. All other penalty points and rating factors shall remain in effect.

3. Nothing in this Order shall affect an individualís obligation to pay any surcharges assessed by the New Jersey Division of Motor Vehicles as provided by law.

 

/s/ Holly C. Bakke

Holly C. Bakke

Commissioner