In June 2005, the New Jersey Supreme Court decided that all New Jersey drivers will have to bear the cost of pain and suffering awards for minor auto accident injuries.  The result will be more lawsuits, which will inevitably lead to higher costs.

Preliminary indications are that the recent New Jersey Supreme Court decision will lead to higher costs and fewer choices for most drivers in New Jersey.
 
The verbal threshold allows drivers to voluntarily limit their right to sue for pain and suffering in exchange for lower premiums.  Fully 92% of New Jersey drivers chose the verbal threshold because it gave them a way to control their auto insurance premiums and ensure that their medical bills are paid, while allowing them to be compensated for serious and permanent injuries.  This decision severely undercuts the advantage of the verbal threshold choice.

By eliminating the requirement that injuries be serious in order to sue for 'pain and suffering,' the court has opened the door to minor lawsuits which will undoubtedly increase cost for the 9-out-of-10 insured drivers who chose the verbal threshold.

An actuarial study based on a review of thousands of actual New Jersey claims found that the changes incorporated in the court’s decision could result in an annual auto insurance cost increases of as much as $300 per year for the typical two-car family.