Sometimes a one-car accident is not driver’s fault – Reilly v. AAA Mid-Atlantic Insurance
In New Jersey, insurance companies are permitted to assess so-called insurance eligibility points to drivers who are convicted of certain moving violations and to those who are involved in “at-fault” accidents. An “at fault” accident occurs when the carrier pays out damages in excess of $1000 and the insured is more than 50% at fault will result in 5 insurance points. An accumulation of 7 or more points over a 3 year period will result in cancellation of the auto insurance policy and banishment from the voluntary market. Such a driver will have to purchase future liability insurance in the assigned risk program.
In Reilly v. AAA Mid-Atlantic, the driver became involved in a single car accident on a hazardous, icy road. The driver claimed that he was not at fault in the accident, but the insurance company assessed 5 eligibility points anyway, under the theory that all single car accidents are the fault of the driver in every case. Due to these points, plus two others from an unrelated traffic ticket, the driver was not permitted to renew his liability policy with his carrier.
The driver challenged this outcome and during the driver’s administrative appeals of this point assessment, the Department of Insurance took the position that their regulation permitted a finding of driver fault in all single car accidents based largely on public policy.
This morning, in a case captioned Reilly v. AAA-Mid-Atlantic Insurance, the Supreme Court held that this particular regulation was unreasonable. The Justices went on to explain that ordinary concepts of negligence must be used as a guide to determine fault in a single car accident as opposed to administrative notions of public policy.
It should be noted that the victorious plaintiff in this matter argued the case on a pro se basis before the Supreme Court.
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