New Jersey’s top lawmaker has come out fiercely defending his legislation that could force more than a million people in the state to pay more for car insurance each year.
President of the Senate Nicolas Scutari on Monday defended the bill that would increase the minimum amount of liability insurance in the Garden State from its current coverage of $15,000 to $25,000 starting in 2023, and a minimum of $35,000 starting in 2026. He says it is high time to protect accident victims.
“This whole thing just doesn’t make sense,” Scutari, D-Union, told a Senate committee hearing, arguing that the cost of driving in the state wouldn’t go up immediately.
“(Insurers) cannot increase rates for at least three and a half years. They can’t justify a rate increase when we go to $25,000 coverage. The industry cannot justify it. It is an impossibility. The Ministry of Banks and Insurance will not allow it,” he said.
“New Jerseyans need this legislature to protect them from themselves because we tell them what they need to get, and that’s what they get.”
He added that taxpayers are the ones stuck with the costs to “subsidize unpaid medical bills” and “anything the insurance industry doesn’t cover” in the minimum policy.
“It’s crazy,” he said.
Scutari’s passionate defense of the bill (S481) came moments after people urged lawmakers not to support the bill.
“Why this urgency? John Harmon, president and CEO of the New Jersey African American Chamber of Commerce, asked. “Couldn’t we take that out and do impact studies?
Harmon testified at the committee hearing on Monday and spoke to NJ Advance Media on Tuesday. He said he was surprised to see Scutari appear briefly at the event to “whip votes” and then disappear moments before the panel voted 8-4 along party lines to advance the bill through the Senate for a vote.
He argued that black and brown New Jersey residents would be disproportionately affected by the bill and said he was surprised not to hear from Scutari or other sponsors of the bill before the measure is heading to the Legislative Assembly for a vote before it lands on the government. Phil Murphyoffice.
“We’re definitely open to compromise, but we haven’t had the opportunity to have that conversation,” Harmon said. “Why is this so important to him compared to all the other things going on?”
A group that represents insurers, the Insurance Council of New Jersey, agreed to raise the minimum coverage to $25,000, but opposed the bill because of the automatic increase in 2026. The average cost of a personal injury claim is $18,000.
They estimate that 1.1 million New Jersey drivers will have to pay an extra $130 a year if the bill is enacted.
The legislation is a streamlined reform bill that Scutari originally hoped to pass.
He has sponsored more than half a dozen bills that opponents say would force 1.27 million drivers to pay up to $350 more a year.
Its initial measures would have required drivers to select plans with a minimum of $250,000 in injury protection, commonly referred to as PIP. Another bill would prohibit motorists from using private health insurance as the primary payer for injury protection coverage in exchange for a car insurance discount.
They were all passed by a Senate committee last week, but were apparently scrapped in the face of backlash.
Scutari had none of that on Monday.
“Let the insurance industry explain why it won’t pay the necessary medical bills (and) keep raising rates,” he said. “And we have the latest media coverage in the country.”
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