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Bill

S 4534

Ensures proper administration and enforcement of the uniform fire prevention and building code and the state energy conservation construction code; and makes conforming technical changes

2025 Regular Session Introduced by Robert Jackson and 1 co-sponsor

Requires auto insurers to include a formal appraisal clause in every policy to resolve disputes over actual cash value, loss amounts, or settlement offers.

REFERRED TO GOVERNMENTAL OPERATIONS
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Bill Summary · S 4534

Summary of Bill S 4534 (Introduced Version)

Note on title vs. content: The bill’s title references fire prevention/building code and energy construction codes, but the introduced text provided concerns right-to-appraisal provisions for automobile insurance claims. The summary below reflects the introduced version’s substantive provisions.

Purpose and Intent

  • To require automobile insurers to include a formal appraisal provision in policies, establishing a structured process for resolving disputes over actual cash value, loss amounts, and offers of settlement in third-party liability claims.

Key Provisions

  • Auto insurers must insert an appraisal clause in every policy issued, renewed, executed, or delivered in New Jersey.
  • Appraisal scope includes:
    • Disagreements about actual cash value or loss amount (repairable vs. total loss) for a claim.
    • Disagreements about the offer of settlement for a third-party liability claim.
  • Process for initiating appraisal:
    • Either party may submit a written demand to the other to invoke the appraisal provision.
    • The receiving party has 20 calendar days to notify the other of the appraiser chosen.
    • Appraisers must independently appraise within 20 business days, stating actual cash value and loss amount, or the offer of settlement.
  • Impartiality:
    • Appraisers must be competent and disinterested (impartial with no financial interest in the opposing party).
  • Resolution of disputes among appraisers:
    • If appraisers disagree, they must memorialize differences and submit to an umpire chosen by the appraisers (or, upon request, a judge in a competent court if no umpire is agreed within 15 days).
    • The umpire (or judge) will review the documentation and issue an award to one of the appraisers, which is filed with the insurer.
  • Third-party claims:
    • The appraisal clause also applies to disputes arising from third-party claims used to determine settlement offers.
  • Definitions:
    • “Competent and disinterested appraiser,” “Offer of settlement,” and “Third-party liability claim” are defined within the act.

Who Is Affected

  • Automobile insurers authorized to write auto insurance in New Jersey.
  • Policyholders of auto insurance.
  • Third-party claimants (in cases where a third-party liability claim affects settlement offers).
  • Appraisers and umpire/judicial participants involved in the appraisal process.

Effective Date and Application

  • Effective 90 days after enactment.
  • Applies to claims filed and offers of settlement made on or after that date.

Legislative History (illustrative)

  • Sponsor: Primary James Skoufis; co-sponsor Robert Jackson.
  • Related bills: A 6106 (companion), A 5289, S 9440, S 3372 (prior sessions).
  • Committee path (Senate): Referred to Senate Commerce; subsequently discharged to Rules; then passed Senate and delivered to the Assembly; referred to Governmental Operations.
  • House path ( Assembly): Referred to Governmental Operations after delivery.

Impact and Practical Considerations

  • Strengthens consumer rights to an independent appraisal in auto claims.
  • Introduces a formal, time-bound process potentially reducing disputes and accelerating resolution.
  • Insurers may incur additional administrative costs and must implement policy language changes to include appraisal provisions.
  • Requires careful adherence to defined timelines to avoid procedural complications.

Compiled from official sources — confirm details with the bill’s official record.

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