The Superior Court of New Jersey addressed whether the state's no fault insurance law bars an insured who was intoxicated at the time of an accident from collecting personal injury protection (PIP) benefits in Walcott v. Allstate New Jersey Ins. Co., 2005 WL 839506 (N.J. Super A.D. Apr. 13, 2005).

 

While intoxicated, Melanie Walcott was involved in a one-car collision. She sustained bodily injury in the accident and sought PIP benefits under her Allstate policy. Allstate denied the claim because Walcott was convicted of driving while intoxicated (DWI). Allstate claimed that the policy's PIP benefits did not apply when the insured's bodily injury resulted from her operation of a motor vehicle while intoxicated.

 

Allstate also said that the statutory bar in New Jersey statutes section 39:6A-4.5 applied. The statute said that anyone convicted of DWI in connection with a motor vehicle accident “shall have no cause of action for recovery of economic or non-economic loss sustained as a result of the accident.”

 

Walcott argued that the statute did not apply to PIP benefits and that exclusions for PIP benefits were found in a different statute, section 39:6A-7. That statute contained no disqualifications for DWI.

 

The court pointed out that, under New Jersey law, all motor vehicle policies must provide PIP benefits “that guarantee, without regard to fault, medical expense benefits to the named insured and his family household members in the event they suffer bodily injury in an automobile accident.”

 

The court further stated that the two statutes cited by the parties controlled different types of claims—section 4.5 applied to third-party and uninsured or underinsured motorists claims, whereas section 7 applied to first-party claims against an insurer. Noting the difference between the two, the court said, “courts have never interpreted Section 4.5 to expand the very narrow limitations for PIP benefits imposed under Section 7.”

 

The court concluded by saying, “Accordingly, the policy provision at issue here, being at odds with coverage that we find legislatively required, is unenforceable and deemed amended to conform to the statutory standards, entitling plaintiff to PIP benefits.”