PIANJ members work to change step-down provisions, meet with legislators

October 11, 2022

PIANJ volunteers spent August and September meeting with the members of the state Assembly Financial Institutions and Insurance Committee to discuss PIANJ’s top legislative priority: a ban on step-down provisions in personal auto policies.

A step-down provision appears in many personal automobile policies. It has the effect of reducing the amount of coverage to which a policyholder would be entitled in the event of a claim. These provisions can manifest in one of several ways.

So-called intra-family step-downs reduce coverage when named-insureds or resident relatives are passengers in their own vehicles. Other step-down provisions reduce coverage for drivers who are not named-insureds or resident relatives. Still others reduce coverage for the incidental business use of a personal auto. In each instance, the step-down reduces coverage from whatever limits a policyholder may have chosen to the state minimums instead. That could amount to a significant reduction in coverage. For someone with 100,000/300,000 limits that would represent an 85% decrease in coverage limits! To make matters worse, these provisions typically are buried deep in the policy where no policyholder would ever see them.

PIANJ hard at work

To combat these hidden traps PIANJ-supports legislation (A-1761) that would protect policyholders by prohibiting the use of step-down provisions in personal auto policies. This would guarantee that policyholders are afforded the coverage limits they purchased instead of being surprised by state minimum limits.

At the meetings this summer, PIANJ was represented by PIANJ President Thomas Wilkens; Vice President Andrew Harris Jr., CIC, AAI; Secretary Aaron Levine, CIC; Treasurer Beth Frederickson, CPIA; Directors Lydia Bashwiner, Esq., CWCP, NJWCP, Lisa Hamm, CIC, Christopher J. Powell, Casey Yarger, CIC, CRM; past Presidents Bruce Blum, CPIA, Louis Beckerman, CIC, CPCU, John A. Latimer, Esq.; and NJYIP Director Bart DiMattina.

PIANJ volunteers met with the following members of the state Assembly: Robert Clifton, R-12; Joe Danielson, D-17; Kim Eulner, R-11; Victoria Flynn, R-13; Roy Freiman, D-16; Yvonne Lopez, D-19; Carol Murphy, D-7; Ellen Park, D-37; Gary Schaer, D-36; and Jay Webber, R-26.

Next steps

PIANJ will continue to advocate for the passage of this bill. And, we encourage you to contact your legislative representatives to ask them to support this bill. Watch your PIA publications for updates.

To see your association’s full position on this and its other legislative priorities, see its Legislative Agenda.

Bradford J. Lachut, Esq.
PIA Northeast | + posts

Bradford J. Lachut, Esq., joined PIA as government affairs counsel for the Government & Industry Affairs Department in 2012 and then, after a four-month leave, he returned to the association in 2018 as director of government & industry affairs responsible for all legal, government relations and insurance industry liaison programs for the five state associations. Prior to PIA, Brad worked as an attorney for Steven J. Baum PC, in Amherst, and as an associate attorney for the law office of James Morris in Buffalo. He also spent time serving as senior manager of government affairs as the Buffalo Niagara Partnership, a chamber of commerce serving the Buffalo, N.Y., region, his hometown. He received his juris doctorate from Buffalo Law School and his Bachelor of Science degree in Government and Politics from Utica College, Utica, N.Y. Brad is an active Mason and Shriner.

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