NJ Bill Could Speed the Process of Reimbursement for Totaled Vehicles

If your car has been totaled in an accident, you need reimbursement right away. That requires transferring the vehicle’s title to your auto insurance company. Currently in New Jersey, the owner of the car has to submit the title to the insurance company by mail, which can be cumbersome and time-consuming.

Now, three New Jersey legislators are sponsoring a measure designed to establish a process by which the ownership and title of totaled and stolen cars can be transferred electronically. The Assembly bill is expected to result in quicker payouts to car owners whose cars have been stolen or damaged to the point that repairs would cost more than the car’s value.

The bill would instruct the state Motor Vehicle Commission (MVC) to set up a system permitting electronic transfer of any documents necessary to put the title to the demolished car in the insurance company’s name. This procedure would also allow the payment of any required fees online.

The bill would also permit a salvage processor — which takes possession of what is left of a totaled vehicle and sells it on behalf of the insurance company — to electronically submit applications for salvage certificates of title and certificates of ownership. This includes electronic submission of documentation supporting such applications, as well as any required fees. Currently, this correspondence and payment is done by mail.

Lastly, the bill would require the MVC to set up a procedure by which the salvage processor could print out the new salvage certificate or certificate of ownership at its own place of business.

New Jersey is one of the few states that still require manual transfers of title documents and, as a result, is one of the slowest in getting titles processed. By insurance industry estimates, the MVC handles 60,000 to 70,000 of these titles every year.

The bill, which has insurance industry support, passed the Assembly Transportation Committee unanimously in June 2021 and is pending in the Assembly Appropriations Committee.

At Seigel Law, we deal with automobile insurance companies every day. If you are not sure that your insurance company is treating you fairly when you are making a claim for compensation, contact an experienced attorney at our Ridgewood office at 201-444-4000 or online to schedule a free consultation.