Auto Accident? Full Tort or Limited Tort – Why it Matters

There are an overwhelming amount of car accidents occurring and this trend has been seen for a very long time. In total, there is in excess of two hundred fifty million vehicles that are registered in the United States. In the early 2000’s, we saw approximately six million car accidents in the first few years. There are many different causes of car accidents, but a majority of these accidents are solely the result of someone acting negligently. A number of these negligent acts include someone not adhering to a particular motor vehicle law. For example, 75 Pa.C.S.A. §3112 (a)(3) of the Pennsylvania Motor Vehicle Code states that an individual must stop at an intersection if there is a solid red light. Failure to stop at this solid red light may cause an accident, and thus be considered negligent by the statute. This is just one example of a negligent act that can cause motor vehicle accidents.

The millions of motor vehicle accidents that occur result in personal injury claims for recovery of economic and noneconomic damages. In turn, insurance companies have become overwhelmed with claims. Pennsylvania and New Jersey hold some of the highest insurance claims in the nation, with PA being within the top ten. On top of that, court systems are overwhelmed with litigation, and automobile insurance premiums were completely out of control. The outcry in Pennsylvania and New Jersey due to these results did not go unheard.

Looking at Pennsylvania today, when insurance is purchased, the individual must select between what is known as the full tort or limited tort coverage options. Established by 75 Pa.C.S.A. §1705, when full tort is selected the individual remains eligible to seek compensation for noneconomic loss (pain and suffering) and economic loss sustained in a motor vehicle accident as the consequence of the fault of another person. On the other hand, when an individual selects the limited tort option, they remain eligible to seek compensation for economic loss sustained in a motor vehicle accident as the consequence of the fault of another person, however, it limits your right to seek financial compensation for injuries unless you fall under one of several exceptions. Exceptions that will render you full tort include: (1) tortfeasor is convicted or accepts ARD for DUI of alcohol or a controlled substance; (2) if you are struck by a vehicle that is registered in another state; (3) if you are struck by someone who is intentionally trying to injure himself or another person; (4) if you are struck by someone who has not maintained financial responsibility of his or her vehicle; (5) if injury is caused by the improper repair or omission during the course of business; and (6) if you are injured in a vehicle that is not a private passenger vehicle.

The exceptions seem to be pretty straight forward, but the final exception is somewhat ambiguous because it includes the idea of a “serious injury” being sustained. According to 75 Pa.C.S.A. §1702, a serious injury is defined as a personal injury resulting in death, serious impairment of bodily function or permanent serious disfigurement. The question of what constitutes a serious injury when proceeding with a claim has and continues to generate considerable litigation. Initially, Pennsylvania courts were dismissing cases with the traditional summary judgement. But there are a few cases that help constitute what can be considered a serious injury. For example, Lalena v. Murray (1995) was a case where the Plaintiff broke their foot and needed stitches in her head, but the court found that these injuries did not impede on her daily life. In another case, Washington v. Baxter (1998), the court had found that only in the “clearest of cases” should the judge use the traditional summary judgement standard. The court believed that the factors that should be considered when determining the seriousness of an injury are the extent of impairment, the length of time of impairment, treatment required to correct impairment, and any other relevant factors such as the negative impact on someone’s ability to perform their profession. The impairment does not have to be permanent for it to be considered a serious injury.

Today in New Jersey, under N.J.S.A. 17:28-1.4, also known as the Deemer Statute or Verbal Threshold which applies the limited tort option to all outside residents who are involved in an accident in New Jersey that is insured by a company who is authorized to do business in New Jersey. This applies even if you are full tort in Pennsylvania. You would think that if you pay a higher premium for full tort in Pennsylvania, it would carry over into New Jersey since they have a similar style of insuring motor vehicles, but that is not the case. In a NJ Supreme Court case, Whitaker v. DeVilla, 687 A.2d 738., the Supreme Court of New Jersey upheld the state statute which, “imposes the verbal threshold [limited tort] on all out-of-state insured who sustain automobile accident injuries in New Jersey and whose policies were issued by insurers authorized to transact business in New Jersey.” There is one loophole to this, and that is that Erie Insurance does no business in New Jersey.

If you live in Pennsylvania and elect full tort insurance you have the right to recover all economic and noneconomic damages, if any. On the other hand, if you elect the limited tort insurance you restrict yourself to recovery for economic damages, unless you fall under the exceptions, even if you can establish all the elements necessary to deem someone else negligent for the injuries you suffer during a motor vehicle accident. And if the exception you are trying to get by on is serious injury, you may have an uphill battle.

Please contact us directly if you have further questions or concerns that you would like to discuss.