Why the Verbal Threshold Does Not Apply to Rideshare Riders

Verbal threshold and rideshare, in brief

• The verbal threshold (N.J.S.A. 39:6A-8(a)) limits pain and suffering claims to six injury categories for drivers who chose it on their own policy.
• N.J.S.A. 39:5H-10(j) says a TNC and its driver cannot raise that defense against a rider on a prearranged ride.
• The exemption protects riders. It does not protect the rideshare driver or other motorists, whose own policy election controls.
• If a third driver caused the crash, a rider’s claim against that driver may still be subject to the rider’s own threshold election.
• Insurers often ignore this rule until a lawyer cites it.

What the verbal threshold is

New Jersey is a no-fault state. Your own auto policy pays your medical bills through PIP, and in exchange the law limits when you can sue for pain and suffering. When you buy a standard auto policy you choose between two options. The “unlimited right to sue” option costs more. The “limitation on lawsuit” option, known as the verbal threshold, costs less and is the default. Most New Jersey drivers have it. Drivers with a basic policy have it automatically.

Under N.J.S.A. 39:6A-8(a), a driver with the limitation on lawsuit can recover pain and suffering only if the injury falls into one of six categories:

1. Death
2. Dismemberment
3. Significant disfigurement or significant scarring
4. Displaced fractures
5. Loss of a fetus
6. A permanent injury within a reasonable degree of medical probability, meaning a body part or organ that has not healed to function normally and will not heal to function normally with further treatment

The sixth category is where most fights happen. It requires a physician’s certification, and insurers hire their own doctors to dispute it. Whiplash, sprains, strains, concussions without lasting symptoms and herniated discs that respond to treatment are routinely challenged. Many legitimate injury claims in New Jersey end with no pain and suffering recovery because of this rule.

What the rideshare law says

When the Legislature wrote the Transportation Network Company Act in 2017, it added a provision aimed squarely at this problem. N.J.S.A. 39:5H-10(j) provides that a transportation network company and its driver may not assert the limitation on lawsuit defense against a rider who is injured during a prearranged ride. In plain terms: if you were a passenger and the rideshare driver’s negligence hurt you, you do not have to prove a permanent injury to recover pain and suffering from the rideshare policy.

The logic is simple. A rider has no control over the car and no relationship with the driver. The rider’s own choice of a cheaper auto policy, or having no auto policy at all, should not reduce what a commercial carrier owes for its driver’s negligence.

Who the exemption covers, and who it does not

Claimant	Claim against	Does the verbal threshold apply?
Rideshare passenger	The rideshare driver or the TNC policy	No. Barred by 39:5H-10(j).
Rideshare passenger	A third driver who caused the crash	Possibly, based on the passenger’s own auto policy election. If the passenger has no auto policy in the household, generally no.
Rideshare driver	A third driver who caused the crash	Based on the rideshare driver’s own personal policy election.
Other motorist hit by a rideshare car	The rideshare driver or the TNC policy	Based on the motorist’s own policy election. The exemption does not extend to them.
Pedestrian or cyclist with no auto policy	Anyone	Generally no. The limitation is tied to an auto policy election they never made.

What this means in dollars

Consider a passenger with a neck and back sprain who treats for four months, misses three weeks of work and recovers fully. For a typical New Jersey driver with the limitation on lawsuit, that claim would likely be limited to lost wages and any medical bills beyond PIP, with no pain and suffering, because the injury healed. For a rideshare passenger claiming against the TNC policy, pain and suffering for those four months is recoverable. The difference can be the majority of the claim’s value.

It also changes how the case is handled. There is no need for a permanency certification from a doctor, and no independent medical exam fight over whether a disc herniation is “permanent.” The case turns on fault and on the injury’s actual effect on your life, which is how it should work.

How insurers handle it

Adjusters for the rideshare carriers know this provision. Unrepresented passengers usually do not. It is common for an adjuster to request a permanency certification, or to make a low offer “because the injury is not permanent,” to a passenger who is exempt from that requirement. When we take a passenger case, one of the first letters we send cites 39:5H-10(j) and removes the threshold from the negotiation.

Two cautions

First, the exemption applies to a prearranged ride. If you were injured by a rideshare driver as a pedestrian or in another car, your own policy’s election controls, and the permanency rules may apply to you. Second, if a third driver caused the crash while you were a rideshare passenger, you may have two claims: one against the TNC policy’s UM/UIM coverage, where the exemption applies, and one against the third driver’s liability policy, where your own threshold election may apply. We evaluate both and pursue whichever pays more.

Scott D. Grossman has practiced New Jersey personal injury law since 1997. Free case review, no fee unless we recover: (732) 625-9494.

Related: Injured as a passenger · Insurance coverage · PIP and medical bills · What a case is worth · NJ rideshare law overview

Sources: N.J.S.A. 39:5H-10(j) · N.J.S.A. 39:6A-8(a) (limitation on lawsuit) · N.J.S.A. 39:6A-4 (PIP).