What If the Other Driver’s Insurance Company Denies Liability?

Why Would an Insurance Company Deny Liability?

An insurer may contend that:

• Its insured did not cause the accident;
• You caused or contributed to the collision;
• Another driver was responsible;
• The available evidence is inconclusive;
• Your injuries were not caused by the accident; or
• Its policy does not cover the driver or vehicle.

Ask the adjuster to provide the denial and its supporting reasons in writing. New Jersey regulations require an insurer to confirm a denial in writing and, when relying on policy language concerning liability, a condition, or an exclusion, identify the relevant language and operative facts. N.J. Admin. Code § 11:2-17.8.

Is the Insurance Company’s Decision Final?

No. The other driver’s insurer does not have the final authority to determine legal responsibility. If the dispute cannot be resolved, a judge or jury may evaluate the evidence and assign fault.

New Jersey follows modified comparative negligence. You may recover damages if your negligence was not greater than the negligence of the person — or combined negligence of the parties — from whom you seek recovery, but your damages are reduced by your percentage of fault. N.J. Stat. Ann. § 2A:15-5.1.

In Krzykalski v. Tindall, 232 N.J. 525 (2018), the New Jersey Supreme Court explained that a plaintiff found more than 50% responsible cannot recover, while a plaintiff found 50% or less responsible may recover a reduced award.

Request the Denial and Claim File Information

Request a written response identifying:

• The insurer's liability determination;
• The facts supporting that determination;
• Any policy provision or exclusion being invoked;
• Whether the insurer assigns any percentage of fault to each driver; and
• What additional evidence the insurer will consider.

An insurer generally must begin investigating a non-physical-damage claim within 10 working days after receiving notice. For a third-party bodily-injury claim, the ordinary maximum payment period is 90 calendar days after notification unless a clear justification exists; if more time is needed, the insurer generally must provide written reasons and periodic updates. N.J. Admin. Code § 11:2-17.7.

Preserve Evidence That May Establish Fault

A liability denial should be answered with evidence rather than speculation. Preserve and obtain, when available:

• The police accident report;
• Photographs and videos of the scene and vehicles;
• Dash-camera or surveillance footage;
• Witness names and statements;
• Vehicle repair estimates;
• Electronic vehicle data;
• Medical records documenting the onset of symptoms; and
• Communications with every insurance company.

Do not alter, discard, or repair relevant physical evidence before it has been appropriately documented. An attorney may also investigate nearby businesses, residences, traffic cameras, and other sources of time-sensitive evidence.

Notify Your Own Insurance Company

Report the accident to your insurer even if you believe the other driver was entirely responsible. New Jersey permits an automobile insurer providing personal injury protection benefits to require written notice as soon as practicable. N.J. Stat. Ann. § 39:6A-5.

Your own policy may provide possible avenues for addressing immediate losses:

• PIP benefits: New Jersey PIP pays qualifying medical-expense benefits for reasonable, necessary, and appropriate treatment regardless of fault, subject to the policy’s benefit plan, limits, deductible, and copayments. N.J. Stat. Ann. § 39:6A-4.
• Collision coverage: If purchased, collision coverage may address covered vehicle damage subject to the policy’s terms and deductible.
• Uninsured or underinsured motorist coverage: These coverages may become relevant in specified circumstances, but a disagreement about who caused the accident does not automatically make the other vehicle uninsured.

For occurrence-based automobile liability policies, late notice does not automatically justify forfeiture. The insurer must establish both a breach of the notice provision and a likelihood of appreciable prejudice. Cooper v. Government Employees Insurance Co., 51 N.J. 86 (1968). Nevertheless, prompt notice is the safest course.

Distinguish a Liability Denial From a Coverage Denial

A liability denial means the insurer disputes whether its driver legally caused the accident. A coverage denial means the insurer contends its policy does not cover the driver, vehicle, or event.

That distinction can affect your available insurance benefits. New Jersey law treats a vehicle as uninsured in certain circumstances when liability insurance exists but the carrier denies coverage or cannot pay because of insolvency or bankruptcy. N.J. Stat. Ann. § 17:28-1.1. A mere denial that the insured driver was at fault is not the same as a denial of insurance coverage.

If your own UM or UIM coverage may apply, notify that insurer promptly and do not sign a release or finalize a settlement without reviewing the policy’s notice, consent, and subrogation requirements. In Longworth v. Van Houten, 223 N.J. Super. 174 (App. Div. 1988), the court addressed procedures intended to protect both an injured insured’s ability to pursue compensation and the UIM carrier’s potential subrogation rights.

Can You Challenge the Denial?

Yes. Depending on the evidence, you or your attorney may submit a written demand asking the insurer to reconsider its decision. The submission may include witness statements, photographs, video, diagrams, repair records, medical documentation, and an explanation of the applicable traffic rules.

New Jersey regulations prohibit an insurer from denying payment when it is reasonably clear that full or partial benefits are payable. N.J. Admin. Code § 11:2-17.8. They also prohibit an automobile insurer from directing a third-party claimant to use the claimant’s own policy solely to avoid payment when liability and damages are reasonably clear. N.J. Admin. Code § 11:2-17.10.

When Should You Contact a Personal Injury Attorney?

Consider contacting a New Jersey personal injury attorney promptly when:

• The insurer denies or disputes liability;
• The parties provide conflicting accounts;
• Multiple vehicles may share responsibility;
• You suffered significant injuries;
• Important video or witness evidence may disappear;
• The insurer requests a recorded statement or broad medical authorization; or
• UM or UIM coverage may be involved.

An attorney can investigate the collision, preserve evidence, identify responsible parties, communicate with insurers, and file a lawsuit when necessary.

New Jersey generally requires a personal injury lawsuit to be filed within two years after the claim accrues, subject to statutory exceptions. N.J. Stat. Ann. § 2A:14-2. If a New Jersey public entity or employee may be responsible, a notice of claim generally must be presented within 90 days after accrual. N.J. Stat. Ann. § 59:8-8.

Speak With a New Jersey Car Accident Attorney

A liability denial does not necessarily end your right to pursue compensation. Surman Law can review the denial, investigate the evidence, evaluate available insurance coverage, and pursue the responsible parties. Contact us at 732-745-6798 or surmanlaw@gmail.com to schedule a consultation.

References

1. [1]Section 11:2-17.8: Rules for fair and equitable settlements and reasonable explanations applicable to all insurance — N.J. Admin. Code § 11:2-17.8
2. [2]Section 2A:15-5.1: Contributory negligence; elimination as bar to recovery; comparative negligence to determine damages — N.J. Stat. Ann. § 2A:15-5.1
3. [3]Krzykalski v. Tindall, 232 N.J. 525 (N.J. 2018)
4. [4]Section 11:2-17.7: Rules for prompt investigation and settlement of claims — N.J. Admin. Code § 11:2-17.7
5. [5]Section 39:6A-5: Payment of personal injury protection coverage benefits — N.J. Stat. Ann. § 39:6A-5
6. [6]Section 39:6A-4: Personal injury protection coverage, regardless of fault — N.J. Stat. Ann. § 39:6A-4
7. [7]Cooper v. Government Employees Ins. Co., 51 N.J. 86 (N.J. 1968)
8. [8]Section 17:28-1.1: Required coverage; exceptions — N.J. Stat. Ann. § 17:28-1.1
9. [9]Longworth v. Van Houten, 223 N.J. Super. 174 (N.J. Super. 1988)
10. [10]Section 11:2-17.10: Rules for fair and equitable settlements applicable to property and liability insurance — N.J. Admin. Code § 11:2-17.10
11. [11]Section 2A:14-2: Actions for injury caused by wrongful act, appointment of guardian ad litem — N.J. Stat. Ann. § 2A:14-2
12. [12]Section 59:8-8: Time for presentation of claims — N.J. Stat. Ann. § 59:8-8