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NJ Court Rejects Appeal of Order Confirming Arbitration Ruling that a Pennsylvania Auto Insurer Was Not Subject to the NJ Deemer Statute

March 22, 2024

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In Comprehensive Pain Solutions of New Jersey, PC a/a/o William Beard v. Omni Insurance Company, the New Jersey Appellate Division recently rejected an appeal of a Law Division judge’s decision to deny an application to vacate a personal injury protection (“PIP”) arbitration award under the Alternative Procedure for Dispute Resolution Act (APDRA). The lawsuit arose from the plaintiff’s PIP claim against Omni Insurance Company (“Omni”) for reimbursement of bills for medical treatment rendered to Omni’s insured, William Beard. Mr. Beard was a Pennsylvania resident who was injured in a New Jersey car accident. Omni is a Pennsylvania automobile insurer which is not licensed or authorized to do business in New Jersey. Beard's policy had a $5,000 limit for medical expense benefits, which was exhausted when plaintiff submitted the bills.


The legal dispute centered on whether Omni was subject to New Jersey’s "deemer" statute, N.J.S.A. 17:28-1.4, which generally requires insurance companies authorized to conduct automobile insurance business in New Jersey to provide certain coverages in out-of-state policies when the insured vehicle is operated in New Jersey. Plaintiff claimed that despite the exhaustion of the PIP limits, Omni was required to provide PIP coverage up to $250,000 per accident as prescribed by N.J.S.A. 39:6A-4(a).


The DRP denied the claim, finding that the limits were exhausted, and Omni was not subject to the deemer statute since it was not licensed or authorized to do business in New Jersey. Plaintiff sought to vacate the award through a summary action in the Superior Court, asserting that the DRP committed prejudicial error by misapplying the law to the facts. The judge agreed with the DRP and denied the application, finding that Omni did no business in New Jersey and that its parent, which was a New Jersey company, had no control over or relationship with Omni.

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