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Bill > A5846
NJ A5846
NJ A5846Revises territorial rating plans used by insurers writing private passenger automobile insurance.
summary
Introduced
06/16/2025
06/16/2025
In Committee
06/16/2025
06/16/2025
Crossed Over
Passed
Dead
01/12/2026
01/12/2026
Introduced Session
2024-2025 Regular Session
Bill Summary
This bill revises the territorial rating plans used by insurers writing private passenger automobile insurance in this State. Specifically, the bill requires the Commissioner of Banking and Insurance to establish rating territories that are geographic areas of the State defined by contiguous zip code+4, that follow municipal boundaries as closely as possible. The bill provides that the maximum number of territories in any territorial map may not exceed 100 territories. Currently, regulations established by the Department of Banking and Insurance provide for rating territories that are geographic areas of the State defined by contiguous zip code, with the maximum number of territories in any territorial map not exceeding 50 territories. By allowing rating territories to be defined by zip code+4, and increasing the maximum number of territories in the territorial map, insurers will be able to take a more detailed, granular approach to the territorial assignment of risk for automobile insurance.
AI Summary
This bill revises the territorial rating system for private passenger automobile insurance in New Jersey by modifying how insurance companies define and establish geographic rating territories. Currently, territories are defined by contiguous zip codes with a maximum of 50 territories, but the bill expands this to use more precise zip code+4 boundaries with a maximum of 100 territories. The bill requires the Commissioner of Banking and Insurance to create rating territories that closely follow municipal boundaries and take into account various factors such as traffic density, population density, driving environments, and loss severity. Importantly, the new territorial definitions aim to create a more granular and equitable approach to assessing insurance risk, ensuring that territories are not arbitrary or unfairly discriminatory. The goal is to allow insurers to more accurately assess and price risk based on more detailed geographic and demographic information. The changes will apply to territorial rating plans filed 120 days after the bill's enactment, giving insurance companies time to adjust their rating systems to the new requirements.
Committee Categories
Business and Industry
Sponsors (1)
Last Action
Introduced, Referred to Assembly Financial Institutions and Insurance Committee (on 06/16/2025)
Official Document
bill text
bill summary
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bill summary
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bill summary
| Document Type | Source Location |
|---|---|
| State Bill Page | https://www.njleg.state.nj.us/bill-search/2024/A5846 |
| BillText | https://pub.njleg.gov/Bills/2024/A6000/5846_I1.HTM |
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