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After months in committee, the state Assembly approved a bill targeting drivers in New Jersey who buy out-of-state insurance but keep their vehicles in the Garden State.
The proposal in A 2204 criminalizes that practice, called “reverse rate evasion,” as a fourth-degree offense, which carries a penalty of up to 18 months in jail.
Sponsoring Assemblyman Wayne DeAngelo (D-Hamilton) said it is a “growing trend” among motorists trying to dodge the insurance premiums in the state that industry analysts say are among the priciest in the U.S.
According to DeAngelo, North Carolina and Pennsylvania are among the states that most reverse rate evaders pick as their home state for their phony policies.
Last April, authorities in Pennsylvania uncovered a criminal operation that fed false information to motorists in nearby states like New Jersey so that they could engage in reverse rate evasion.
“All vehicles that should be registered and insured in New Jersey should be properly registered and insured,” DeAngelo said in a statement.
The unanimous 76-0 vote on Monday sent the piece of legislation to the state Senate for further consideration.
The landslide vote showed that lawmakers want to fight “loss of revenue to the state, higher premiums for those who properly register their vehicles and [reduced] revenue for New Jersey insurers,” according to DeAngelo.
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