New Jersey lawmakers are considering an exemption for antique car insurance companies from the state’s strict new insurance rules, but the exemption would likely require them to offer a higher level of coverage than the state does now, according to a legislative source.
“It’s something that’s not something that is currently available,” said State Sen. Michael Gianaris, a Republican who represents the state that includes Newark.
“It’s kind of a grey area that we’re looking at.
It would be a lot of work to get through to make sure that’s a legal option for us.”
Gianaris said he expects the insurance companies would be exempt from the current rules.
“If it comes down to it, they could be exempt, but they don’t want to be,” Gianaris said.
New Jersey has the most antique car owners per capita in the country, but many of those owners would likely have to shell out more for coverage under the proposed rule.
Under the current insurance laws, insurance companies cannot charge more than the federal minimum of $2,500 per year per vehicle.
The state’s insurance commissioners are also reviewing the insurance industry’s proposed new policies to determine whether the insurance should be exempt.
But Gianaris and other legislators say it would likely be a stretch to allow insurance companies to offer more expensive policies under the current regulations.
The New Jersey Insurance Department estimates that the new rules could cost the state between $1 billion and $2 billion in extra revenue.
The agency’s website says that under the rules, insurance premiums would rise to $4,500 from $2.75 per year.
The new insurance regulations would also create a $250 tax credit for people who buy new antique cars.
The credit is meant to offset the cost of the old vehicles, according the website.
The proposed exemption would also exempt antique antique car dealers and other antique car repair businesses, according Gianaris.
But Gianaris told The Associated Press that he did not believe antique car buyers would be able to qualify for the exemption.
“There’s no way they would be allowed to buy antique cars because they wouldn’t be eligible for the new car insurance,” Gianris said.
“And if they wanted to buy old cars, they would have to get new insurance.”
The proposed rule would also apply to antique car and boat insurance, which Gianaris described as “very niche,” adding that antique car companies often had to pay out more than $5,000 to repair their old vehicles.
“If you’re going to get into the antique car business, there are a lot more niche markets, and the people that can’t afford that, they’re going into the traditional car business,” Gianias said.
The proposal also would allow insurance for antique boat insurance that’s currently prohibited under the state and federal insurance regulations, Gianaris added.
The governor is expected to sign the proposal into law on Thursday.