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Personal Injury

Auto Accident Claims Under the Revised No-Fault Law and

Verbal Threshold Standard in New Jersey

By John D. Kovac, Esq.

Introduction

New Jersey's no-fault law has always distinguished between medical treatment, which is provided regardless of fault, and claims for pain and suffering, which are restricted to "serious injuries" in many cases and can only be successful if the injured party proves the negligence of someone else. The no-fault aspect of the law usually involves a claim for medical treatment against one's own insurance company. In contrast, a claim for pain and suffering is asserted against a negligent driver's insurance company unless the negligent driver is uninsured or underinsured, then a claim against one's own policy may be an option.

An injured motorist covered by the no-fault statute is entitled to medical coverage even if he causes the accident. Typically medical bills are paid by the injured party's own insurance company, but if the injured party is a passenger or pedestrian without insurance, treatment should be available under a policy covering the vehicle or negligent driver involved. Medical coverage is known as "personal injury protection" or "PIP," which provides treatment to any injured motorist, even one responsible for an accident. Claims for pain and suffering, however, may only be brought by a claimant not primarily at fault in the accident such as a passenger, a driver hit from behind, or a driver partly at fault but less so than another driver.[i]

The New Jersey legislature amended the no-fault law in 1998. Under the old law, insurance costs were supposed to be kept low by the elimination of certain "non-serious" pain and suffering claims. With the new law, the legislature endeavors to further restrict pain and suffering claims and, in addition, to cut unnecessary medical expenses. Unfortunately it appears probable that the new law will make it harder in some circumstances to get medical treatment and will result in fewer legitimate pain and suffering claims. Furthermore, despite intentions to the contrary, the new law will continue to burden residents with unreasonably high insurance premiums. New Jersey courts are just now beginning to interpret the amended statute, and it is not yet clear to what extent additional limits will be placed on pain and suffering claims.

Basic Policies, Standard Policies, and Verbal Threshold

The 1998 amendments to the no-fault law created a "basic policy." Offered as a means of keeping costs down, this policy provides only minimum coverage. Medical treatment (PIP benefits) is limited to $15,000 per person per accident unless there is a "catastrophic injury" such as permanent or significant brain damage, spinal cord damage, disfigurement, or other acute injury requiring immediate hospital care. N.J.S.A. 39:6A-3.1. Catastrophic injuries are covered up to $250,000. Some serious injuries, however, may necessitate more than $15,000 in medical care without qualifying as catastrophic.[ii] A consumer who purchases a basic policy puts herself at risk of insufficient medical coverage, especially if she is not covered by an employee or other health insurance policy.

One's right to medical benefits is determined by one's own insurance policy. The ability to sue for pain and suffering is also affected by the presence or absence of a verbal threshold provision in one's own policy, though the funds available to compensate for pain, suffering, and economic damages[iii] will depend on the amount of coverage in a negligent driver's policy. The basic policy imposes a "verbal threshold" or "lawsuit limitation." Under this policy, suits for pain and suffering are prohibited unless an injury results in

  • Death
  • Dismemberment
  • Significant disfigurement or significant scarring
  • Loss of a fetus
  • Displaced fractures
  • A permanent injury within a reasonable degree of medical probability, other than scarring or disfigurement. An injury shall be considered permanent when the body part or organ, or both, has not healed to function normally and will not heal to function normally with further medical treatment. N.J.S.A. 39:6A-8.

These exceptions constitute limits below which claims for pain and suffering are prohibited. The new criteria omit the following exceptions under the old law: (a) injuries resulting in significant limitation of a body function; (b) non-permanent impairments limiting substantially all usual daily activities for at least 90 days out of the first 180 days after the accident; and (c) non-displaced fractures. Under the new law, the broadest exception is for a "permanent injury" under category six. This exception, which appears to be more restrictive than the "significant limitation" exception under the old law, will be the one subject to the most litigation.

The standard policy is an alternative to the basic policy. In contrast to the basic policy, which automatically includes verbal threshold limits, standard policies come either with or without verbal threshold. For an increase in the premium, a standard policy may be purchased with a "no threshold" option that allows the insured to sue a negligent driver for damages even if the injury is minor. The injured party's right to sue depends not on the policy of the negligent driver but on the content of the injured party's own insurance contract.

Basic policies exclude benefits provided in standard policies such as income continuation, essential services, death benefits, funeral expenses, and uninsured/underinsured coverage. Unlike the basic policy, the standard policy offers benefit flexibility. For an increased premium, the verbal threshold may be omitted so that the insured can obtain compensation for pain and suffering after a negligently inflicted injury. If possible, the "no threshold" option should be selected so the insured can recover damages for personal injury and avoid the problems of verbal threshold discussed in this article.

Uninsured/underinsured coverage, optional in a standard policy, allows an injured motorist to recover for pain and suffering beyond the monetary limits of a negligent driver's policy. For example, A negligently drives his car into the rear of B's car, causing B to sustain a displaced fracture of the leg requiring surgery. A's coverage is $15,000/30,000 ($15,000 per person, $30,000 per accident), meaning B can recover up to $15,000 from A. If C and D were also injured in B's car, the three of them combined may recover no more than a total $30,000 if none has uninsured/underinsured coverage. But if B has $100,000 uninsured/underinsured coverage, she may recover up to $100,000 in damages if her injury so warrants. Up to $15,000 would be collected from A's insurance company; the remainder would be paid by B's insurance company.

Under the basic policy, bodily injury liability of $10,000 may be purchased. This coverage, which pays damages to others arising out of a drivers' own negligence, is offered beginning at $15,000 per person and $30,000 per accident in standard policies, with an option for more. A consumer with assets to protect should purchase liability coverage of $100,000/$300,000 or more. Obviously the basic policy option of $10,000 will not protect an insured from the claim of an injured party if the insured negligently causes a catastrophic or serious injury. The minimum standard policy option also leaves a negligent driver vulnerable to loss of a home or other assets. Both basic and standard policies offer liability insurance of $5000 for damage negligently caused to other vehicles. Again, the basic policy has only one choice, but standard policy options are flexible. Finally, the basic policy offers no collision or comprehensive coverage for damage to one's own vehicle. In sum, New Jersey drivers who can afford it should purchase a standard policy without verbal threshold, with at least $100,000 of uninsured/underinsured coverage, with liability coverage sufficient to protect assets, and with medical (PIP) coverage up to $250,000.

Medical Treatment

The new no-fault law impedes the process of obtaining medical treatment. Under the new law, the PIP carrier monitors medical treatment and requires a doctor's certification prior to the rendering of certain treatments and tests, and prior to the prescription of certain medication. The injured party should find a doctor with experience in dealing with PIP claims and make sure that the doctor immediately notifies the insurance company in writing of her involvement. Emergency care, testing, and diagnostic procedures do not require pre-certification, but the insurance company should be notified within 48 hours of an accident. Though an insured might not select a treating physician within 48 hours of the accident, notification of the accident itself still must be given to the insurance company.

Department of Banking and Insurance regulations require doctors to adhere to a set course of treatment for neck and back injuries. According to our Department of Banking and Insurance, these injuries are "fraught with the potential for unnecessary treatment and over-utilization of benefits." Coalition for Quality Health Care v. New Jersey Department of Banking and Insurance, 348 N.J Super, 272, 280 (App. Div. 2002). These regulations, known as "care paths," limit the type of treatment and the number of visits allowed within various time periods after the accident. In the first four weeks, there may be five office visits to a doctor, physical therapy, medication, and diagnostic testing, with no more than 12 visits combined for all of these services. N.J.A.C. 11:3-4.6. After four weeks, prior to providing further treatment or testing, the treating physician must notify the insurance company that additional treatment or testing is "medically necessary." The PIP carrier has two or three days to respond, depending on the time specified in its "decision point review plan," which must be submitted for approval to the Department of Banking and Insurance. N.J.A.C. 11:3-4.7(a). A denial must be based on "the determination of a physician." N.J.A.C. 11:3-4.7(b). If the insurance company fails to respond within the applicable time period, the treatment specified in the notice to the carrier may be given.

Insurance companies now have the right to steer injured motorists to doctors and testing centers within an approved network of providers. This means that treatment may still be obtained outside of the network, but subject to out-of-pocket copayments of up to 50 percent. Id. at 307-308. Where in-network choices are limited, in-network providers might be inclined to restrict treatment in order to maintain business with insurance companies. An injured motorist might then face the unpleasant choice of insufficient treatment on one hand or unaffordable treatment on the other.

For example, a patient with a neck injury experiences pain and numbness shooting into the right arm making it difficult to work and perform household chores. This symptom suggests the presence of a herniated disc, which could be confirmed by an MRI. The average network doctor, however, might be less willing to recommend this test than a doctor not directly tied to the insurance company in question. In this situation, if the patient wants to confirm the nature if his injury, he has various options. One is to find an independent doctor who recommends the MRI. Even if this is done, however, the insurance company must approve the test, which still may be denied based upon the recommendations of the original doctor and their own internal review board. At this point, the injured party must ask for binding arbitration under the rules set forth in N.J.S.A. 39:6A-5.1. Another option is for the injured party to go out of network at the outset and make the required copayment. Here too, even if the doctor recommends the MRI, the insurance company may deny the request. But a denial under these circumstances would be less credible to a potential arbitrator and therefore less likely.

Though disputes over medical care occurred under the old law, under the new law they will likely be more frequent because insurance companies have additional opportunities to cut off treatment, and they may now direct injured motorists to doctors inclined to side with them on close calls. This is not to say that all or even most in-network doctors will short change their patients—just that it is possible that some will given the incentives built into the revised no-fault law.

Determining Viable Claims Under the Verbal Threshold: Permanent Injury and the Serious Impact Test

Death and significant injuries remain compensable under the new law. These injuries include lost limbs, severely broken bones, heart attacks, and brain damage. Injuries falling within categories one, two, and five are relatively clear cut. There is, however, a wide spectrum of injuries that falls into a gray area that may or may not be severe enough to qualify as a verbal threshold exemption. This gray area would include category 3 (significant disfigurement or scarring). But the broadest and most ambiguous exception is category six's "permanent injuries," which would include back, neck, and shoulder impairments, carpal tunnel syndrome, various arm and hand injuries, sprained ankles, Temporomandibular  joint (TMJ) syndrome, certain leg injuries, hip injuries, non-displaced fractures, [iv] and psychiatric claims.

The six verbal threshold exceptions, set forth in N.J.S.A. 39:6A-8 and listed above, are fewer in number than the nine exceptions in place prior to the 1998 amendments. Though there has been some debate as to whether it will now be harder for pain and suffering claims to survive, [v] the first case to directly address the new law (in particular, category six) suggests it will be more difficult. In dismissing a lawsuit for neck and back sprains, the court in Jacques v. Kinsey, 347 N.J. Super 112 (Law Division 2001) emphasized the legislature's intent to preclude "non-serious" claims:

One way AICRA [the Automobile Insurance Cost Reduction Act] seeks to keep the cost of premiums down is by limiting the right to people injured in motor vehicle accidents to sue for non-economic injuries. The insured has the option of electing a no threshold (the unlimited right to sue for non-economic injuries) or a verbal threshold where the right to sue for non-economic loss is limited. With respect to the verbal threshold, the legislation's preamble states: "this legislation . . . provides for a revised lawsuit threshold for suits for pain and suffering which will eliminate suits for injuries which are not serious or permanent, including those for soft tissue injuries. N.J.S.A. 39:6A-11.

AICRA has made a number of changes to the verbal threshold in order to tighten up the standards in accordance with the goals set forth above. Losses or injuries that are temporary no longer qualify; fractures must be displaced in order to qualify. Plaintiff's claim must be supported by a physician's certification based on objective clinical evidence. N.J.S.A. 39:6A-8.

Due to this history and legislative intent, the verbal threshold standard must not be read liberally to allow the threshold to be easily met. Rather, the verbal threshold must be viewed as an important barrier designed to keep insurance costs down. Insureds selecting the verbal threshold experience significant savings in insurance premiums because of the limitation on their right to sue for non-economic damages. Plaintiff's injuries in this case would not have met the threshold under prior law, and nothing in the legal history suggests an intent to ease rather than tighten the standard.

In Jacques v. Kinsey, the plaintiff's treating physician submitted a certification stating that the plaintiff sustained cervical and lumbar sprains that are permanent as evidenced by continuing muscle spasms and loss of range of motion. The court defined four factors in the permanent injury category, all of which must be established by certification of a physician to avoid dismissal of the case:

  • A qualifying injury—plaintiff has a body part or organ which no longer functions normally;
  • Permanency—the body part or organ will neither heal nor function normally[vi] in the future even with further medical treatment;
  • Causation—the accident caused the injury to the body part or organ; and
  • Objective clinical evidence—the physician must rely on objective clinical evidence to support these findings.

In addition to these requirements, a leading case under the old law also requires a plaintiff attempting to establish a permanent injury[vii] to prove that the injury had a "serious impact" on his or her life. The "serious impact" requirement was established by the New Jersey Supreme Court in Oswin v. Shaw, 129 NJ 290 (1992) and remained applicable up to the 1998 revisions. In contrast to the four factors above, which must be proved by objective medical evidence, the serious impact test involves a claimant's state of mind. From the plaintiff's point of view, the injury must have a serious impact on his life. This is yet another way for trial courts to bar claims. Jacques v. Kinsey did not determine if the serious impact test applies after the 1998 amendments, which make no reference to it. The court never considered the serious impact test because it held there was insufficient proof that the injury was permanent: the doctor's range-of-motion findings were merely subjective (verifiable only by the patient's word) and therefore not enough to pierce the threshold. Furthermore the court stated that muscle spasms can be objective evidence (verifiable by means other than the patient's word) but that muscle spasms alone are insufficient.

After Jacques v. Kinsey, Compere v. Collins, 352 N.J. Super 200 (Law. Div. 2002), held that the serious impact test is inapplicable under the new law. A subsequent case [Rogozinski v. Turs, 351 N.J. Super 536 (Law Div. 2002)], however, reached the opposite conclusion. In Compere v. Collins, the court asserted that the serious impact test announced in Oswin v. Shaw was inextricably linked to the old law, which the New Jersey legislature borrowed from New York. In contrast, because the new law is modeled on a Florida statute and makes no mention of the serious impact test, it is not required:

A permanent injury within a reasonable degree of medical probability which requires an objective test other than scarring or disfigurement, is by its very definition serious, when it is restricted to a body part or organ that has not healed to function normally and will not heal to function normally with further medical treatment. The other categories such as death and dismemberment are by their very terms serious. The word serious is not a talisman, which when used automatically, requires the Oswin charge. As outlined above, the word serious in Oswin was taken directly from the New York Statute and caselaw and is not found in this new statute. There is nothing in the legislative history to suggest reference should be made to the New Jersey Torts Claims Act.[viii] This court concludes, therefore, that the Legislature with its silence and lack of any legislative history supporting its desire to include Oswin's subjective analysis did not intend to do so and this court, therefore, will not read it into the otherwise plain language of this statute.

This reading removes one barrier to an injured party's recovery. But in Rogozinski v. Turs, a different court, focusing on the overall intent of the legislature rather than the statutory language, concluded that the serious impact test is required under the new law. The opinion cites the legislature's statement that it provided for "a revised lawsuit threshold for suits for pain and suffering which will eliminate suits for injuries which are not serious or permanent including those for soft tissue injuries." Rogozinski at 547. Rogozinski also cites former Governor Whitman's statement that the old statute failed to achieve its purpose because it "allowed for recoveries that were not permanent." Id. at 548. Therefore, the court concluded, "there is nothing in the language of the amended statute that reflects an intention . . . to alter the requirement under Oswin v. Shaw that the injuries have a serious impact on the plaintiff and the plaintiff's life." Id. at 550.

One result of retaining the serious impact test is that the treating doctor's certification alone will be insufficient to save a case from a motion for summary judgment--an attempt to dismiss a suit before trial.[ix] In addition to a doctor's certification, the plaintiff must present evidence (such as her own certification or deposition testimony) of serious impact in response to a motion for summary judgment. Moreover, the doctor's certification itself is subject to challenge:

The certification is intended as an anti-fraud measure to assure legitimacy. It is necessary to state a claim, not sufficient to establish one, and will be subject to challenge through the normal discovery and summary judgment process. [Id. at 548, again quoting former Governor Whitman.]

A review of the application of law to facts in Rogozinski and Compere illustrates how particular injuries are addressed under the new no-fault act. In Rogozinski, the plaintiff was diagnosed with a back strain at the emergency room after a rear-end collision. Subsequently an MRI of the lower back was normal, and an MRI of the neck showed disc desiccation (dryness) but no herniations. MRIs of the right and left hip registered joint effusions (escape of fluid into tissue), and an EMG showed left moderate L5-S1 radiculopathy (pain or numbness traveling from the spinal nerves into the leg). In other words, there was some evidence of back and hip injury, but the evidence of nerve damage in the spine was equivocal: the MRI was negative, the EMG positive.

After the accident, the plaintiff received physical therapy and chiropractic treatment lasting approximately ten months. The treating physician certified that the plaintiff would have permanent "neck pain, stiffness, and weather sensitivity; lower back pain, stiffness, weather sensitivity; headaches; recurrent anxiety insomnia secondary to trauma." Id. at 543-544. Plaintiff certified that he suffers from neck and lower back pain, that the back pain is "fairly constant" and radiates to his left hip and leg, that his left hip hurts regularly, and that he takes over-the-counter painkillers. He further stated that he has trouble bending, running, walking, or driving for long periods of time, that he cannot run or jog, and that he has difficulty performing household chores.

Given these facts, the court concluded that the plaintiff's injuries did not qualify as "permanent" under the new statute and did not have a significant impact on his personal and professional life. Though the new requirements fail to specify that a permanent injury must also be serious, the court required proof of "a serious injury of a permanent nature." Id. at 553. It was not enough that the plaintiff had headaches, some neck pain and stiffness, a lower back sprain with muscle spasms, and intermittent radiating pain into the leg as documented on the EMG. Even if the plaintiff's medical condition had qualified as serious and permanent, the case would still have been dismissed, according to the court, because he was unable to show that his injuries significantly affected his life: He lost no time at work. He could still "engage in virtually all of the activities he engaged in prior to this accident" despite some pain. And his alleged inability to run, jog, and perform various household chores was not shown to have been sufficiently disruptive. Id. at 556-557.

In Compere, the plaintiff sustained a torn meniscus in the right knee. Several months after the accident he had surgery and missed work for three weeks while recovering. He testified that he could no longer squat, run, jog, or play basketball with friends; he had trouble exercising and doing odd jobs around the house; his knee, which could not fully extend, bothered him forty to fifty percent of the time. Whereas the claim in Rogozinski was dismissed prior to trial, the plaintiff's claim in Compere reached trail, and the jury awarded $200,000. The defense complained on appeal that the verdict was excessive and the jury was not instructed to apply the serious impact test. Rejecting these and other claims, the court affirmed the verdict.

Jacques v. Kinsey, Rogozinski v. Turs, and Compere v. Collins are Law Division cases subject to the higher authority of the Appellate Division, and the ultimate authority of the New Jersey Supreme Court (which has not addressed the issues considered in these cases). The state of our new no-fault law remains uncertain: we still do not know if the serious impact test will in the end be required by the Supreme Court. If this test is not mandated, it is still possible that the new law will in some respects be interpreted more liberally than the old law, or at least no more strictly. This possibility, however, appears unlikely because our higher courts, in the opinion of this author, will be more inclined to follow our legislature's intent to restrict claims rather than follow the literal language of the new statute.

Some attorneys, now believing that auto accident cases are more difficult to win, are limiting their practice to cases where the verbal threshold is either clearly met or where it is not included in the insurance policy. Nevertheless many verbal threshold claims are still winnable and will remain so even if our Appellate Division and Supreme Court ratify the more restrictive language found in Jacques v. Kinsey and Rogozinski v. Turs. Though interpretations of the new law will probably allow fewer claims, any additional restrictions may turn out to be a relatively small matter of degree, and old case law will remain relevant.

Under the old law, many neck and back injuries without herniations did not pass the verbal threshold even though Oswin v. Shaw held that soft-tissue injuries are not necessarily barred. For example, in Mentemayor v. Signorelli, 339 N.J. Super 482 (App. Div. 2001[x]), a neck sprain with muscle spasms and disc desiccation evidenced by an MRI were insufficient, and the court found there was no serious impact because the plaintiff's income and job status were not affected. On the other hand, in Moreno v. Greenfield, 272 N.J. Super 456 (App. Div. 1994), the plaintiff had a herniated disc with complaints of pain radiating into her right leg though the MRI failed to conclusively demonstrate nerve damage. The plaintiff's decision to leave her job was unrelated to the accident, but she curtailed what had been an active life including dancing, exercise, and going out. Under these circumstances, the court allowed the case to go to trial. In Natale v. Kasling, 336 N.J. Super 198 (App. Div. 2001), the Appellate Division said there may be serious impact where the plaintiff complained of a diminished sex life, and an inability to work overtime, to do most household chores, and to take long trips by car. The trial court's decision of no serious impact was reversed. Interestingly the trial court found that decreased neck and back range of motion with muscle spasms but no herniation passed the verbal threshold; and the Appellate Division voiced no objection to this finding.

Rogozinski v. Turs, and Compere v. Collins may have come to the same result under the old law, where soft-tissue injuries were often insufficient but most injuries requiring surgery survived. It is quite likely that under the new law no soft tissue injury standing alone will be compensable. This issue, however, is still undecided, as are questions about disc herniations: Would the Moreno plaintiff now be allowed to reach trial with a herniation but equivocal proof of nerve damage? Will surgery be necessary for a back or neck case to pass the threshold? It also remains to be seen if the serious impact test will be expanded to include more than just the permanent injury exception. Our courts will soon answer these questions. In the meantime, plaintiffs' attorneys will have to rely on Compere and favorable cases under the old law.

Conclusion

No-fault law in New Jersey, originally passed in 1972, has failed to reduce insurance premiums, which remain among the highest in the nation. The 1998 statutory changes are unlikely to bring about rate changes, but the new law will make it harder for some legitimately injured parties to obtain medical care and will likely further limit pain and suffering claims. Insurance companies and their lobbyists appear to have convinced our legislature and a significant portion of the public that it is in our interest to make life more difficult for injured motorists, who now must look to our courts for protection. Presently our system poorly serves many injured claimants while premiums for all remain high. For the same money, we should demand a better product from our lawmakers, which, in the end, may require repeal of the no-fault law.[xi]

Postscript

As this article was being finalized, two Appellate decisions were published that address the respective issues of (1) the doctor's certification and (2) the serious impact test. In Rios v. Szivos, 2002 WL 31499384, the court, following Rogozinski, held that the defense may move to dismiss a case by summary judgment even if the treating physician submits a certification as required under the new law. James v. Torres, 2002 WL 31500322, also following Rogozinski, held that the Automobile Insurance Cost Reduction Act (ACRA) did not do away with the serious impact test. Both decisions rely heavily on legislative intent to restrict lawsuits for pain and suffering.

In James, the plaintiff suffered bulging discs in the neck and lower back verified by MRIs. There was also evidence of nerve dysfunction on an EMG, though a nerve conduction study was normal. Despite these injuries and a visit to the emergency room on the day of the accident, the plaintiff only missed two days from work. Nevertheless she experienced difficulty holding her two-year-old child, going up and down stairs, driving for long periods, sitting and standing quickly, and doing household chores. Without much comment or analysis, the court concluded that these problems with her daily life were not sufficiently serious and upheld the trial judge's dismissal of the case on a motion for directed verdict.

Though Rios and James clarify questions about physician's certifications and the special impact test under the new law, the extent to which the Automobile Insurance Cost Reduction Act will preclude claims is still unclear. On one hand, James can be seen to impose greater restrictions because a claimant with multiple herniated discs documented by objective evidence was turned away. The court's emphasis on our legislature's intent to make claims more difficult suggests that fewer cases will get through. On the other hand, the plaintiff was only out of work for two days. And by acknowledging that there are problems with determining subjective impact because the cases contradict each other,[xii] the court implies that under the new law (as with the old law), a court's decision itself is a subjective one. With such ambiguity, a confusing and fact specific body of case law will most likely develop, posing many risks for plaintiffs, some for defendants, and lots of opportunity for more litigation.

End Notes

[i] If the accident occurs during the course and scope of employment, an injured party may seek workers' compensation benefits, including benefits for permanent disability, regardless of fault. The workers' compensation system is completely separate from personal injury law, and is handled in state administrative courts.

[ii] Injuries categorized as "catastrophic" under N.J.S.A. 39:6A-3.1 appear to be more strictly defined than injuries deemed sufficiently serious to qualify for an exception to verbal threshold under N.J.S.A. 39:6A-8. Thus even within the restricted category of injuries that can pass the verbal threshold, some may not qualify for medical treatment beyond the minimum offered under the basic policy.

[iii] Economic damages, including loss of past and future earnings, are also a component of an automobile negligence suit. But unlike a pain and suffering claim, which is subject to the verbal threshold, a claim for economic damages is not. See Jefferson v. Freeman, 296 N.J. Super., 54 (App. Div. 1996).

[iv] Prior to the 1998 amendments, any fracture, no matter how small, quickly healed, or insignificant was enough to surmount the verbal threshold. Now only "displaced fractures" qualify (See Fowler v. Crystal Motors, Inc., 340 N.J. Super. 33, 46 (2001); a non-displaced fracture will be compensable only if it qualifies as a permanent injury.

[v] See Gerald H. Baker, "How Insurance Reform Affects No-Fault Cases," 155 N.J.L.J. 332, Jan. 25, 1999, for an argument that the amended law will make it easier to bring bodily injury claims. The opposing argument is made by Thomas P. Widner and Michael J. Canavan in "The 'New' Verbal Threshold: But Is It Improved," 24 Seton Hall Legis. 117 (1999).

[vi] The requirement that a body part or organ no longer "function normally" echoes language in one of the eliminated exceptions under the old law, which exempted from the verbal threshold "injuries resulting in significant limitation of a body function." Given this similarity, a plaintiff's attorney may cite pre-amendment case law in support of a client asserting the permanent injury exception under the new law.

[vii] Fowler v. Crystal Motors, Inc., 340 N.J. Super. 33 (2001) limited the serious impact test to soft tissue injuries under the old law. In Fowler, the court held that a claimant attempting to overcome the verbal threshold with a rib fracture did not have to prove the injury had a serious impact on her life. It has not yet been determined if the serious impact test will apply to displaced fractures, non-displaced fractures, and other non-soft tissue injuries under the new statute.

[viii] Verbal threshold law differs from the law applicable to claims against public entities (municipal and state government) or public employees. Under the New Jersey Tort Claims Act (Title 59), public entities are immune from suit unless specific exceptions apply. In addition to, among other things, requiring notice of claims within 90 days of the accident, the Tort Claims Act imposes a severity-of-injury prerequisite analogous to the verbal threshold. Brooks v. Odom, 150 N.J. 395 (1997), compels an injured party suing a public entity to show objective evidence of "a permanent loss of a bodily function that is substantial." Id. at 406. This standard, according to the court, is more restrictive than the old verbal threshold standard because it precludes exemptions contained in the old statute. These exemptions were (a) significant limitation of a body function, and (b) non-permanent impairments limiting substantially all of the claimant's usual daily activities for at least 90 days out of the first 180 days after the accident. Id. at 404-405. Because the new verbal threshold eliminates these two exemptions, the new law and our present Tort Claims standard are now more similar than they were. Plaintiffs' attorneys should expect insurance company lawyers to cite tort claims cases in support of dismissing verbal threshold claims.

[ix] A summary judgment motion made by the defense before trial is the first of three junctures where a verbal threshold suit may fail. If the plaintiff's case survives a summary judgment motion, the defense may raise verbal threshold issues again with a motion for directed verdict after the plaintiff's case is presented at trial. The level of proof required to prevail on each motion is similar; so a motion for directed verdict would not likely succeed if a summary judgment motion was denied, unless there has been a change in the strength of the evidence. Finally, even if the judge sends the plaintiff's case to the jury, the jury may still find that the verbal threshold was not crossed and rule in favor of the defendant.

[x] Decided under the old law. Though the new law was passed in 1998, it takes a few years for disputes arising under this law to reach the appellate level. Meanwhile disputes arising under old insurance policies have been making their way through the courts.

[xi] See Gerald H. Baker, "Implementing AICRA," The New Jersey Law Journal, January 22, 2001, pp. S3-S8.

[xii] Before citing a list of cases for comparison, the court notes, "It would not be an understatement to say that it can appear difficult to find an analytical thread unifying subsequent judicial treatment [subsequent to Oswin v. Shaw] of what constitutes a 'serious impact.'"

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