The pending New Jersey Insurance Fair Conduct Act explained by Jared Stolz, Esq

FLEMINGTON, N.J. - March 7, 2019 - PRLog -- The New Jersey Insurance Fair Conduct Act ("IFCA") may create a private cause of action for violation of the New Jersey Unfair Claims Settlement Practices Act ("UCSPA"), explains attorney Jared Elliott Stolz. Senate Bill S2144, titled the New Jersey Insurance Fair Conduct Act ("IFCA") has passed the New Jersey Senate and is currently pending before the New Jersey Assembly's Financial Institutions and Insurance Committee. The bill was referred in the summer of 2018 and whether the bill will ultimately pass during the 2018-2019 legislative session is unclear.  The passage of the bill in the senate, however, could signal an eventual adoption of the bill or some reasonable facsimile in the near future.

Jared Stolz, Esq. is providing his thoughts on this subject in a new article. The complete article will be available on Mr. Stolz' blog at https://jaredstolz.law.blog/

The core of the bill is the creation of a private cause of action for violation of New Jersey Unfair Claims Settlement Practices Act ("UCSPA").  UCSPA prohibits insurers from engaging in various deceitful practices, such as misrepresentation of facts or denial of claim without reasonable investigation. Currently, violations of the UCSPA is enforced by the New Jersey Department of Banking and Insurance.

Under current law, aggrieved insured can pursue common law cause of actions such as bad faith delay or denial of claims for insurance benefits.  Such common law remedies allow for recovery of consequential damages but no punitive or treble damages.

Critics of IFCA are concerned that the law may create unreasonable burden on insurers and may ultimately end up hurting consumers through additional costs that ends up getting passed on as higher premiums.  One criticism of the IFCA is the extremely broad definition of insurers subject to the law.  IFCA defines "insurers" as "any individual, corporation, association, partnership or other legal entity which issues, executes, renews or delivers an insurance policy in this State, or which is responsible for determining claims made under this policy."  Such a broad definition would cover not only the insurance companies themselves, but also potentially employees of the companies.

*** Jared Elliott Stolz is an attorney in New Jersey, focusing on insurance law and litigation. Jared E. Stolz is the managing partner of Stolz and Associates.

Attorney profile: https://solomonlawguild.com/jared-stolz%2C-new-jersey
Blog: https://jaredstolz.law.blog/