Auto Accident Demand Letter - New Jersey

DEMAND FOR SETTLEMENT — MOTOR VEHICLE COLLISION

STATE OF NEW JERSEY

[________________________________]
Attorneys at Law
[________________________________]
[________________________________], New Jersey [____]
Telephone: [________________________________]
Facsimile: [________________________________]
Email: [________________________________]

DATE: [__/__/____]

VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED
AND VIA ELECTRONIC MAIL

[________________________________]
[________________________________]
[________________________________]
[________________________________], [____] [____]

RE: SETTLEMENT DEMAND — MOTOR VEHICLE COLLISION
Our Client: [________________________________]
Date of Loss: [__/__/____]
Your Insured: [________________________________]
Policy Number: [________________________________]
Claim Number: [________________________________]

Dear [________________________________]:

This firm represents [________________________________] ("Claimant") in connection with the motor vehicle collision that occurred on [__/__/____] in [________________________________] County, New Jersey. This letter constitutes a formal demand for settlement of all claims arising from this incident.

I. NEW JERSEY-SPECIFIC LEGAL FRAMEWORK

A. Statute of Limitations

Under N.J.S.A. 2A:14-2, the statute of limitations for personal injury actions is two (2) years from the date of injury.

The limitations period in this matter expires on [__/__/____].

B. Modified Comparative Negligence (51% Bar)

New Jersey follows modified comparative negligence under N.J.S.A. 2A:15-5.1. A plaintiff is barred from recovery if the plaintiff's negligence is greater than the combined negligence of all defendants. Where recovery is permitted, damages are reduced by the plaintiff's percentage of fault.

Our client bears no fault whatsoever for this collision.

C. No-Fault System — Verbal Threshold vs. Zero Threshold

New Jersey operates a choice no-fault system under the Automobile Insurance Cost Reduction Act (AICRA). Motorists choose between two lawsuit threshold options on their insurance policy:

Option 1 — Limitation on Lawsuit Option ("Verbal Threshold"):
The insured may not sue for non-economic damages (pain and suffering) unless the injury falls within one of the six categories listed in N.J.S.A. 39:6A-8(a):

☐ Death
☐ Dismemberment
☐ Significant disfigurement or significant scarring
☐ Displaced fracture
☐ Loss of a fetus
☐ Permanent injury within a reasonable degree of medical probability, other than scarring or disfigurement (the body part or organ has not healed to function normally and will not heal to function normally with further medical treatment)

Option 2 — No Limitation on Lawsuit Option ("Zero Threshold"):
The insured retains the full right to sue for all damages, including pain and suffering, regardless of the nature or severity of injury.

D. Our Client's Threshold Status

Our client elected: ☐ Verbal Threshold (Limitation on Lawsuit) ☐ Zero Threshold (No Limitation)

[If Verbal Threshold applies — complete Section II below]
[If Zero Threshold applies — skip to Section III]

E. PIP Coverage

Under N.J.S.A. 39:6A-4, New Jersey requires Personal Injury Protection (PIP) coverage. Standard PIP limits are $250,000, with options for $150,000 or $75,000 (for policies that elected lower PIP at reduced premium). PIP covers medical expenses regardless of fault.

F. No Damage Caps on Compensatory Damages

New Jersey does not impose statutory caps on compensatory damages in automobile accident cases.

G. Minimum Insurance Requirements

New Jersey requires minimum liability coverage of $35,000 per person / $70,000 per accident for bodily injury and $25,000 for property damage (effective January 1, 2026), plus PIP coverage with a standard limit of $250,000 (lower options of $150,000, $75,000, or $15,000 available), under N.J.S.A. 39:6A-3.

II. VERBAL THRESHOLD ANALYSIS (If Applicable)

This section applies only if the claimant elected the Verbal Threshold option.

A. Threshold Category Satisfied

Our client's injuries satisfy the verbal threshold under N.J.S.A. 39:6A-8(a) because:

Primary category: [________________________________]

☐ Permanent Injury: Our client has sustained a permanent injury within a reasonable degree of medical probability. The affected body part/organ has not healed to function normally and will not heal to function normally with further medical treatment.

☐ Displaced Fracture: Our client sustained a displaced fracture of the [________________________________], as confirmed by [imaging study/date].

☐ Significant Disfigurement/Scarring: Our client sustained significant disfigurement/scarring to [________________________________].

☐ Other qualifying category: [________________________________]

B. Medical Certification

Within 60 days following the date of the answer, we will provide a certification from a licensed treating physician or board-certified physician stating, under penalty of perjury, that our client sustained an injury meeting the threshold, based on and referring to objective clinical evidence. N.J.S.A. 39:6A-8(a).

C. Medical Evidence Supporting Permanency

[________________________________]
[Provide detailed narrative explaining how the medical evidence supports a finding that the injury is permanent — the body part has not healed to function normally and will not heal to function normally]

III. PRESERVATION OF EVIDENCE DEMAND

☐ Complete claims file, including all adjuster notes and evaluations
☐ All photographs, videos, and surveillance footage
☐ All recorded or written statements
☐ Vehicle inspection reports, repair estimates, and salvage records
☐ Event Data Recorder (EDR) / "black box" data
☐ Cell phone records of the insured driver
☐ All insurance policy documents, including threshold election

IV. STATEMENT OF FACTS

On [__/__/____], at approximately [____] [a.m./p.m.], our client was [________________________________] on [________________________________] in [________________________________] County, New Jersey. At that time, your insured, [________________________________], was operating a [____] [________________________________] (VIN: [________________________________]).

[________________________________]
[Describe the collision in detail]
[________________________________]

The [________________________________] [New Jersey State Police / Municipal Police] responded to the scene and prepared Crash Report No. [________________________________].

V. LIABILITY ANALYSIS

A. Defendant's Negligence

Your insured breached the duty of care by:

☐ Failing to maintain a proper lookout — N.J.S.A. 39:4-97
☐ Following too closely — N.J.S.A. 39:4-89
☐ Failing to yield the right of way — N.J.S.A. 39:4-90 et seq.
☐ Speeding or exceeding safe speed — N.J.S.A. 39:4-98
☐ Running a red light or stop sign — N.J.S.A. 39:4-81, 39:4-144
☐ Improper lane change — N.J.S.A. 39:4-88
☐ Distracted driving / cell phone use — N.J.S.A. 39:4-97.3
☐ Driving under the influence — N.J.S.A. 39:4-50
☐ Other: [________________________________]

B. Negligence Per Se

Violation of the New Jersey Motor Vehicle Code constitutes evidence of negligence. Dolson v. Anastasia, 55 N.J. 2, 258 A.2d 706 (1969).

VI. MEDICAL TREATMENT SUMMARY

A. Emergency / Immediate Treatment

B. Ongoing Treatment

C. Diagnosis Summary

☐ [________________________________]
☐ [________________________________]
☐ [________________________________]

D. Prognosis

[________________________________]

VII. ITEMIZED MEDICAL EXPENSES

Estimated Future Medical Expenses

VIII. LOST WAGES AND EARNING CAPACITY

Employer: [________________________________]
Position: [________________________________]
Rate of Pay: $[________] per [hour/week/month/year]

IX. PROPERTY DAMAGE

X. PAIN AND SUFFERING / NON-ECONOMIC DAMAGES

☐ Physical pain and suffering (past and ongoing)
☐ Mental anguish and emotional distress
☐ Loss of enjoyment of life
☐ Inconvenience and disruption of daily activities
☐ Scarring and/or disfigurement
☐ Fear and anxiety
☐ Sleep disruption

Non-Economic Damages Claimed: $[________]

XI. LOSS OF CONSORTIUM

[If applicable:]

Claimant's spouse, [________________________________], has suffered a loss of consortium. Beynon v. Trezza, 150 N.J. 481, 696 A.2d 711 (1997) (spouse's loss of consortium recognized as derivative claim).

Loss of Consortium Claimed: $[________]

XII. TOTAL DAMAGES SUMMARY

XIII. SETTLEMENT DEMAND

Based upon the foregoing, we hereby demand the sum of:

$[________________________________]

This demand is open for thirty (30) days from the date of this letter, expiring on [__/__/____].

XIV. BAD FAITH WARNING

N.J.S.A. 17:29B-4 — Unfair Claims Settlement Practices

Under N.J.S.A. 17:29B-4, an insurer that engages in unfair claims settlement practices is subject to regulatory penalties. Unfair practices include failure to promptly investigate claims, misrepresentation of policy provisions, and not attempting good-faith settlements when liability is reasonably clear.

New Jersey courts recognize a cause of action for bad faith failure to settle within policy limits. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 323 A.2d 495 (1974). An insurer that fails to settle a case within policy limits when it could and should have may be liable for the full judgment, including amounts in excess of policy limits.

Your company is on notice that failure to respond in good faith may expose it to excess liability and bad faith claims.

XV. ENCLOSED DOCUMENTS

☐ Medical records and bills from all treating providers
☐ PIP payment records and EOBs
☐ Police/crash report
☐ Photographs of vehicle damage and injuries
☐ Employer verification of lost wages
☐ Property damage estimates
☐ Insurance declarations page showing threshold election
☐ [________________________________]

XVI. RESPONSE REQUESTED

Please confirm receipt and provide a substantive response within thirty (30) days.

Respectfully submitted,

[________________________________]
Attorneys for [________________________________]

By: _________________________________
[________________________________]
New Jersey Bar No. [________________________________]
[________________________________]
[________________________________], New Jersey [____]
Telephone: [________________________________]
Email: [________________________________]

NEW JERSEY PRACTICE NOTES AND CHECKLIST

☐ Verbal Threshold: Must be satisfied unless client elected "zero threshold" — verify declarations page
☐ Medical Certification: Required within 60 days of answer; must be under penalty of perjury based on objective clinical evidence
☐ 51% Bar Rule: Plaintiff barred if fault exceeds combined defendant fault (N.J.S.A. 2A:15-5.1)
☐ No Damage Caps: Full compensation available
☐ PIP: Required; standard $250,000; coordinate with third-party claim
☐ Punitive Damages: N.J.S.A. 2A:15-5.12 — clear and convincing evidence; capped at 5x compensatory or $350,000, whichever greater
☐ Whole Person Rule: For comparative negligence analysis — Brodsky v. Grinnell Haulers, Inc., 181 N.J. 102 (2004)
☐ Government Claims: NJ Tort Claims Act (N.J.S.A. 59:8-8) — 90-day notice requirement
☐ Minimum Insurance: $35,000/$70,000/$25,000 plus PIP (standard $250,000) (N.J.S.A. 39:6A-3)

SOURCES AND REFERENCES

• N.J.S.A. 2A:14-2 (Statute of limitations)
• N.J.S.A. 2A:15-5.1 (Comparative negligence)
• N.J.S.A. 39:6A-8 (Verbal threshold)
• N.J.S.A. 39:6A-4 (PIP benefits)
• N.J.S.A. 17:29B-4 (Unfair claims practices)
• N.J.S.A. Title 39 (Motor Vehicles)
• New Jersey Legislature: https://www.njleg.state.nj.us