On March 16, 2020, the New Jersey legislature introduced Bill A-3844 with the goal of alleviating the economic toll on certain insureds arising from the global COVID-19 pandemic and with the extraordinary aim of altering the terms of existing policies, potentially forcing private insurers to cover business interruption losses not covered by the existing language of polices and/or that were expressly excluded. Incredibly, the bill would also require insurers that did not write first-party business interruption coverage at all to provide such coverage. The draft bill is limited to insureds in New Jersey with fewer than 100 full-time employees (those who work 25 hours or more per week), and the forced coverage would still be subject to policy limits otherwise in place for business interruption.

The bill was pulled on March 16, 2020, and thus failed to reach a floor vote because of discussions over amending it. The bill sponsors say that the bill is still in consideration. We will continue to watch and report on the evolution of this bill.

NJ Bill A-3844

On March 19, 2020, the New Jersey Department of Banking and Insurance issued Bulletin 20-04 to all entities regulated by the Departments concerning the disruptions from COVID-19. In part, the Insurance Division encouraging carriers to relax due dates for premium payments and insurance policy based loan payments, extending grace periods, waiving late fees and penalties, allowing for forbearance with regard to cancellation / nonrenewal of policies, allowing payment plans for premium payments, extending time frames to complete property and automobile inspections or undergo medical exams, and exercising judicious efforts to assist affected policyholders and work with them to ensure their policies don’t lapse.

NJ Bulletin 20-04

On April 9, 2020 the New Jersey Governor issued Executive Order No. 123 that prohibits cancellations of any policy or contract as a result of nonpayment during the emergency grace period.

NJ Executive Order No. 123

On April 10, 2020, the New Jersey Department of Insurance issued Bulletin No. 20-15 to all property and casualty insurers directing them to provide insureds experiencing a financial hardship due to COVID-19 with a 90-day grace period to pay insurance premiums to avoid cancellation for nonpayment. Insurers are also directed to waive late payment fees and allow the catch-up payment to be made over a 12-month period or the remainder of the current policy period, whichever is longer.

NJ Bulletin No. 20-15

On April 24, 2020, the New Jersey Department of Insurance issued Bulletin 20-19 requiring automobile insurers that provide medical expense benefits under personal injury protection (PIP) to review or establish their telemedicine and telehealth networks, encourage network providers to utilize telemedicine or telehealth services during the COVID-19 public health emergency, etc.

The department also prohibits PIP insurers from imposing reimbursement restrictions on providers and imposing prior authorization requirements on any treatment that is delivered through telemedicine or telehealth.

NJ Bulletin 20-19

On May 12, 2020, the New Jersey Department of Insurance issued Bulletin 20-22 ordering insurers to make an initial premium refund or other adjustment to all adversely impacted New Jersey policyholders, and, for each month the public health emergency is in effect, in the following lines of insurance starting as quickly as practicable, but no later than June 15, 2020: private passenger automobile insurance, commercial automobile insurance, workers’ compensation insurance, commercial multiple-peril insurance, commercial liability insurance, medical malpractice insurance, and any other line of coverage where the measures of risk have become substantially overstated as a result of the COVID-19 pandemic.

NJ Bulletin 20-22