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Muschette v. Gateway Insurance Co.

Decided: March 30, 1977.

MILTON J. MUSCHETTE, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF ROSE LEE MUSCHETTE, DECEASED, PLAINTIFF-RESPONDENT,
v.
THE GATEWAY INSURANCE CO., AN INSURANCE COMPANY DOING BUSINESS IN THE STATE OF NEW JERSEY, DEFENDANT-APPELLANT. MILTON J. MUSCHETTE, INDIVIDUALLY AND AS ADMINISTRATOR OF THE ESTATE OF ROSE LEE MUSCHETTE, DECEASED, PLAINTIFF-RESPONDENT, V. THE GATEWAY INSURANCE CO., AN INSURANCE COMPANY DOING BUSINESS IN THE STATE OF NEW JERSEY, DEFENDANT-APPELLANT



Halpern, Michels and Botter.

Per Curiam

[149 NJSuper Page 91] Defendant*fn1 appeals from a judgment awarding plaintiff certain benefits under the personal injury protection (P.I.P.) provisions of its insurance policy. The policy insured Milton J. Muschette, his wife Rose Lee, and their automobile. It is conceded that the policy provided "additional" P.I.P. coverage (N.J.S.A. 39:6A-4) as well as the additional first-party coverage (Option 5), made available as required by N.J.S.A. 39:6A-10. During the

term of the policy plaintiff's wife was killed in an automobile accident. She had been gainfully employed and had cared for and maintained the family household, which included three infant children. Defendant admitted liability for P.I.P. benefits provided by § 4 but appeals from the award of the maximum amount of the additional P.I.P. coverage provided pursuant to § 10, together with 10% interest as specified in N.J.S.A. 39:6A-5. Plaintiff cross-appeals from the trial judge's refusal to add counsel fees to the award.

N.J.S.A. 39:6A-4 requires automobile liability insurance policies to provide

This coverage includes: (a) medical expense benefits; (b) income continuation benefits up to $5,200; (c) essential services benefits up to $4,380; (d) survivor benefits, and (e) funeral expenses benefits up to $1,000. Subsection (d) provides survivor benefits as follows:

In the event of the death of an income producer as a result of injuries sustained in an accident entitling such person to benefits under section 4 of this act, the maximum amount of benefits which could have been paid to the income producer, but for his death, under section 4 b. shall be paid to the surviving spouse, or in the event there is no surviving spouse, then to the surviving children, and in the event there are no surviving spouse or surviving children, then to the estate of the income producer.

In the event of the death of one performing essential services as a result of injuries sustained in an accident entitling such person to benefits under section 4 c. of this act, the maximum amount of benefits which could have been paid such person, under section 4 c., shall be paid to the person incurring the expense of providing such essential services.

N.J.S.A. 39:6A-10 requires additional optional coverage in the following terms:

Insurers shall make available to the named insured covered under section 4, suitable additional first-party coverage for income continuation benefits, essential services benefits, survivor benefits and funeral expense benefits. Income continuation in excess of that provided for in section 4 must be provided as an option by insurers to persons for disability, as long as the disability persists up to an income level of $35,000.00 per year, with the excess between $5,200.00 and the amount of coverage contracted for to be written on the basis of 75% of said difference. The Commissioner of Insurance is hereby authorized and empowered to establish, by rule or regulations, the amounts and terms of income continuation insurance to be provided pursuant to this section.

By regulation (see N.J.S.A. 39:6A-10 and N.J.S.A. 39:6A-19) the Commissioner promulgated a minimum schedule of "additional personal injury protection." N.J.A.C. 11:3-7.3(a). The schedule established income continuation benefits of $36,400 in the maximum, essential services benefits of $10,220 in the maximum, and $10,000 for death occurring within 90 days from the accident. (N.J.A.C. 11:3-7.3(d) provides that benefits in excess of the scheduled amounts must be made available at the option of the named insured.) Having purchased the optional, additional first-party coverage in the maximum scheduled amounts, plaintiff claimed the maximum benefits in each category because of his wife's death.

Defendant contends that N.J.S.A. 39:6A-4(d), requiring payment of "the maximum amount of benefits" in the event of death, applies only to the P.I.P. coverage specified in § 4 and does not apply to the additional coverage authorized in § 10. N.J.S.A. 39:6A-4(d) provides "survivor benefits" payable to certain survivors in case of death of a person who was an income producer, defined in N.J.S.A. 39:6A-2(d), and/or one who performed essential services, defined in N.J.S.A. 39:6A-2(b), for ...


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