This bill amends the existing legal framework regarding legal insurance in New Jersey by clarifying the definition of "legal insurance" and distinguishing it from traditional insurance products. The bill specifies that "legal insurance" involves the obligation to pay or reimburse for specified legal services or expenses in exchange for a specified payment over time, regardless of whether the payment is made by the beneficiaries or a third party. It also explicitly states that the payment of an administrative fee to an attorney does not qualify as payment for legal services or expenses.

Additionally, the bill outlines several exceptions that do not fall under the definition of legal insurance, including retainer contracts, limited consultation plans, informal legal services, and legal services provided by unions or nonprofit organizations. By modernizing the legal language and clarifying these distinctions, the bill aims to ensure that certain legal service plans are recognized as separate from traditional insurance products, which typically involve claims and risk assumption. The act is set to take effect 90 days after its enactment.

Statutes affected:
Introduced: 17:46C-3