Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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UPDATED: Aug 11, 2011

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Insurance Question from Brick, NJ

Asked on 08/11/2011

do i have to pay new jersey guaranty association fees each time i get my auto insurance bill? each 6 month bill i get a separate bill added on for new jersey guaranty association

Answer given on August 20, 2011

insurance fees or taxes are set by the state or department of insurance to protect consumers in the event an insurance company goes bankrupt. The fees help protect policyowners by having a fund available to pay claims if the company is unable to do so.The fees are continually collected at the renewal of each insurance policy that is subject to the fee. If the department of insurance determines there are enough funds in the program they may reduce the fee or stop collecting it for a time. However, they may start it up again if a company becomes distressed and claims have to be paid from the fund. It may seem unfair for the fees to be added to your premiums every renewal, however it is set up to protect you and to make sure money is available to you in the event of a loss. It would be much more painful to find that you had no way of collecting on a claim because the insurance company had gone bankrupt.


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