What If the Driver Who Hit Me Had Minimal Insurance?

How Much Insurance Might the Other Driver Have?

For standard automobile policies issued or renewed on or after January 1, 2026, New Jersey’s minimum bodily-injury liability limits are $35,000 for one injured person and $70,000 for multiple injured people in one accident. N.J. Stat. Ann. § 39:6A-3.

However, some drivers may have different policy types. A basic automobile policy may include optional bodily-injury liability coverage of only $10,000 per accident. N.J. Stat. Ann. § 39:6A-3.1. A qualifying special automobile policy provides no liability, uninsured motorist, or underinsured motorist coverage. N.J. Stat. Ann. § 39:6A-3.3.

Because coverage varies, request written confirmation of every applicable policy and its limits. Other potentially responsible parties or policies should also be investigated.

What Is UM/UIM Coverage?

Uninsured motorist (UM) coverage generally applies when the responsible vehicle has no applicable liability insurance, including certain hit-and-run or coverage-denial situations. Underinsured motorist (UIM) coverage applies when the responsible driver’s liability limits are lower than the claimant’s applicable UIM limit. N.J. Stat. Ann. § 17:28-1.1.

Accordingly, minimal but valid liability insurance ordinarily implicates UIM — not UM. UIM eligibility depends on comparing policy limits, not merely the value of the injuries. In French v. N.J. School Board Insurance Group, 149 N.J. 478 (1997), the New Jersey Supreme Court explained that the tortfeasor is underinsured only when the applicable liability limits are lower than the UIM limits held by the claimant.

For example, if the at-fault driver has $35,000 in liability coverage and you have $100,000 in applicable UIM coverage, a potential UIM claim may exist. If both limits are $35,000, the driver generally is not underinsured for statutory purposes — even if your damages greatly exceed $35,000.

How Does the UM/UIM Claim Process Work?

1. Give prompt notice. Notify every potentially applicable UM/UIM carrier and follow the policy's notice requirements.
2. Verify coverage. Identify all policies covering you and determine whether the responsible vehicle is uninsured or underinsured.
3. Prove the claim. Whether seeking UM or UIM benefits, you must establish fault, injuries, and recoverable damages.
4. Cooperate with the carrier. Comply with applicable policy conditions, including reasonable requests for information and participation in the policy's claim-resolution process. UM/UIM coverage remains subject to approved policy terms, exclusions, subrogation provisions, and arbitration requirements.
5. For a UM claim, establish uninsured status. The carrier will investigate whether the responsible vehicle lacked applicable coverage and evaluate liability and damages.
6. For a UIM claim, pursue available liability coverage. Identify and exhaust the applicable liability limits through settlement or judgment, and give the UIM carrier notice before signing a release.
7. Resolve the remaining UIM claim. The carrier will evaluate coverage, liability, damages, policy compliance, and applicable offsets.

UIM benefits are subject to an offset for the applicable liability limits. Accepting less than the available liability limit may leave the claimant responsible for that shortfall.

Do Not Settle Before Giving Longworth Notice

Before accepting the at-fault driver’s settlement and signing a release, notify your UIM carrier. In Longworth v. Van Houten, 223 N.J. Super. 174 (App. Div. 1988), the court established a procedure intended to balance the injured person’s right to settle against the UIM carrier’s potential right to pursue the at-fault driver.

After receiving notice, the UIM carrier may permit the settlement or substitute its own payment of the offered amount in exchange for the claimant’s rights against the driver. Thirty days is a presumptive response period when no trial date has been assigned, although reasonable timing depends on the circumstances. Longworth, 223 N.J. Super. 174.

The New Jersey Supreme Court adopted this notice framework in Rutgers Casualty Insurance Co. v. Vassas, 139 N.J. 163 (1995). The insured should notify the UIM carrier when litigation begins, when the responsible driver’s coverage appears insufficient, and when an inadequate settlement offer or award is received.

Failure to provide notice can have serious consequences. In Ferrante v. New Jersey Manufacturers Insurance Group, 232 N.J. 460 (2018), the insured forfeited UIM coverage after withholding notice until the underlying action was finally resolved and the carrier’s intervention and subrogation rights had been destroyed.

Can I Accept Less Than the Liability Limit?

An injured person may accept the best available settlement even when it is below the liability limit, but doing so can affect the UIM calculation. Longworth, 223 N.J. Super. 174. The full available liability limit may still be deducted when calculating UIM benefits, meaning the claimant can be responsible for the gap between the available limit and the smaller settlement accepted.

This makes it important to obtain legal advice before accepting a discounted liability settlement.

Can I Combine Multiple UIM Policies?

New Jersey generally prohibits stacking multiple UM or UIM limits to create a larger combined limit. N.J. Stat. Ann. § 17:28-1.1. The New Jersey Supreme Court has explained that a claimant’s UIM recovery ordinarily cannot exceed the highest limit available under any single applicable policy. Magnifico v. Rutgers Casualty Insurance Co., 710 A.2d 412 (N.J. 1998).

Policy language may also determine which coverage is primary, excess, or subject to a step-down limitation. A careful review of every potentially applicable policy is therefore essential.

What If UIM Coverage Is Unavailable or Insufficient?

You may pursue a personal judgment against the at-fault driver for damages exceeding available insurance. This generally requires filing suit within the applicable deadline, serving the driver, and establishing liability and damages through settlement, default proceedings, or trial. Litigation can be lengthy and expensive, reducing the practical value of recovery. Longworth, 223 N.J. Super. 174.

After judgment is entered, post-judgment discovery and enforcement may begin through tools such as information subpoenas and writs of execution. N.J. Ct. R. 6:7-2; N.J. Ct. R. 4:59-1. A judgment does not guarantee payment. Collection ultimately depends on whether the driver has reachable, nonexempt income or property.

How Is a Judgment Collected in New Jersey?

• Information subpoenas: A creditor may require the debtor to answer written questions under oath about employment, bank accounts, and assets. N.J. Ct. R. 6:7-2.
• Writs of execution: A writ directed to the sheriff is the ordinary process for enforcing a money judgment. N.J. Ct. R. 4:59-1.
• Bank levies: Money belonging to the debtor may be levied upon. N.J. Stat. Ann. § 2A:17-15. A bank levy generally reaches the identifiable funds present when the levy is served rather than automatically capturing later deposits. T C Leasing, Inc. v. Wachovia Bank, N.A., 421 N.J. Super. 221 (App. Div. 2011).
• Wage execution: A creditor may apply for an execution against qualifying wages and earnings. N.J. Stat. Ann. § 2A:17-50. The amount generally may not exceed 10% unless the debtor’s income exceeds the statutory threshold. N.J. Stat. Ann. § 2A:17-56.
• Real-estate liens and execution: A docketed Superior Court judgment creates a lien against the debtor’s New Jersey real property. New Brunswick Savings Bank v. Markouski, 123 N.J. 402 (1991). Execution ordinarily proceeds against personal property before a creditor may seek a court order permitting the sale of real property. N.J. Ct. R. 4:59-1.

A New Jersey judgment may be revived, or an action may be brought upon it, within 20 years after entry. N.J. Stat. Ann. § 2A:14-5.

Why Can Collecting an Excess Judgment Be Difficult?

Collection may be difficult when the driver:

• Has no significant savings or property;
• Has low or unstable wages;
• Already has prior liens or wage executions;
• Holds funds that are exempt from collection; or
• Files for bankruptcy protection.

Only one wage execution is satisfied at a time, with priority generally determined by the order in which executions are presented. N.J. Stat. Ann. § 2A:17-52. New Jersey also protects wearing apparel and up to $1,000 of other personal property from ordinary execution, subject to statutory exceptions. N.J. Stat. Ann. § 2A:17-19.

Bankruptcy may discharge the driver’s personal obligation, although a properly established judgment lien may survive in some circumstances. New Century Financial Services, Inc. v. Staples, 379 N.J. Super. 489 (App. Div. 2005). The result depends on the debtor’s property, existing liens, exemptions, collection steps already taken, and bankruptcy proceedings.

For these reasons, a large judgment against a driver with no collectible assets may have limited immediate value.

What Are the Likelihood and Costs of Collecting an Excess Judgment?

Before pursuing an excess judgment, an attorney should investigate the defendant’s income, real estate, financial accounts, existing liens, and other potentially reachable assets. The likelihood of collection depends more on those resources than on the judgment amount.

Collection expenses may include asset searches, filing and service fees, post-judgment discovery, sheriff or levy charges, and attorney fees. N.J. Ct. R. 6:7-2; N.J. Ct. R. 4:59-1. If the defendant is effectively judgment-proof, these costs may exceed any realistic recovery.

Speak With a New Jersey Car Accident Attorney

When the responsible driver has minimal insurance, early investigation is critical. Joe Surman can identify all available liability and UIM policies, preserve your UIM rights, provide proper settlement notice, and evaluate whether pursuing an excess judgment is economically practical. Contact Surman Law at 732-745-6798 or surmanlaw@gmail.com to schedule a consultation.

References

1. [1]Section 39:6A-3: Compulsory automobile insurance coverage; limits — N.J. Stat. Ann. § 39:6A-3
2. [2]Section 39:6A-3.1: Election of basic automobile insurance policy; coverage provided — N.J. Stat. Ann. § 39:6A-3.1
3. [3]Section 39:6A-3.3: Establishment of special automobile insurance policy — N.J. Stat. Ann. § 39:6A-3.3
4. [4]Section 17:28-1.1: Required coverage; exceptions — N.J. Stat. Ann. § 17:28-1.1
5. [5]Longworth v. Van Houten, 223 N.J. Super. 174 (N.J. Super. 1988)
6. [6]Rutgers Cas. Ins. Co. v. Vassas, 139 N.J. 163 (N.J. 1995)
7. [7]Ferrante v. N.J. Mfrs. Ins. Grp., 232 N.J. 460 (N.J. 2018)
8. [8]Magnifico v. Rutgers Cas. Ins. Co., 710 A.2d 412 (N.J. 1998)
9. [9]Rule 6:7-2: Orders for discovery; information subpoenas — N.J. Ct. R. 6:7-2
10. [10]Rule 4:59-1: Execution — N.J. Ct. R. 4:59-1
11. [11]Section 2A:17-15: Money — N.J. Stat. Ann. § 2A:17-15
12. [12]T C Leasing, Inc. v. Wachovia Bank, N.A., 421 N.J. Super. 221 (N.J. Super. 2011)
13. [13]Section 2A:17-50: Order to issue wage execution; application; jurisdiction — N.J. Stat. Ann. § 2A:17-50
14. [14]Section 2A:17-56: Limitation on amount specified in execution — N.J. Stat. Ann. § 2A:17-56
15. [15]New Brunswick Sav. Bank v. Markouski, 123 N.J. 402 (N.J. 1991)
16. [16]Section 2A:14-5: 20 years; judgments — N.J. Stat. Ann. § 2A:14-5
17. [17]Section 2A:17-52: Number of executions issued and levied at same time; priority — N.J. Stat. Ann. § 2A:17-52
18. [18]Section 2A:17-19: Amount; exceptions — N.J. Stat. Ann. § 2A:17-19
19. [19]New Century Financial v. Staples, 379 N.J. Super. 489 (N.J. Super. 2005)