PLNJhard
A NJ Standard Policy insured carries 100/300 BI and matching 100/300 UM/UIM with no written rejection. He suffers $200,000 in covered bodily-injury damages from an at-fault driver carrying 25/50 BI and recovers the $25,000 per-person BI limit. Under N.J.S.A. 17:28-1.1, what is the maximum UIM amount payable from his own carrier?
A$100,000 — UIM stacks on top of the BI recovery
B$175,000 — UIM fills the gap between BI recovery and total damages
C$0 — because the insured already recovered the at-fault driver's BI limits
$75,000 — the $100,000 UIM limit is reduced by the $25,000 BI recovery
Why this is the answer
N.J.S.A. 17:28-1.1 structures NJ UIM as excess over the at-fault driver's BI limits, reduced by amounts recovered from that liability policy. With $100,000 UIM and a $25,000 BI recovery, the carrier pays a maximum of $75,000 UIM. The remaining $100,000 of the insured's $200,000 damages is uninsured and recoverable only directly from the at-fault driver, typically uncollectible.
Studying for the NJ Personal Lines exam?
This question comes from our PL bank. Take a free practice test — no signup.