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SIU Spotlight

Top 10 Recommendations for Addressing Fraud in NJ PIP Arbitration: A DRP’s Perspective

May 15, 2026

by Gary T. Lesser

New Jersey’s no fault PIP system presents a unique blend of statutory requirements, arbitration procedures, and evolving fraud schemes. For carriers, counsel, and SIU professionals, navigating this landscape effectively requires more than familiarity with the rules — it demands an understanding of how Dispute Resolution Professionals (DRPs) evaluate evidence, credibility, and patterns of abuse.

Drawing on more than a decade as a Forthright PIP arbitrator and extensive experience investigating staged losses and systemic fraud, I offer ten practical recommendations for strengthening fraud detection and improving outcomes in PIP arbitration.

1. Understand the NJ PIP Landscape

New Jersey’s PIP framework is unlike any other. Arbitration, not Superior Court, is the primary forum for resolving disputes, and Forthright’s DRPs adjudicate cases based strictly on the evidence presented. Appreciating the procedural nuances — including timelines, evidentiary expectations, and the limits of DRP authority — is essential for building a defensible case.

2. Spot the Red Flags Early

Fraud often reveals itself in the details. Early indicators include:

  • Overutilization of treatment
  • Templated or boilerplate medical reports
  • Conflicting timelines
  • Identical documentation across unrelated claimants

Identifying these patterns at the outset allows carriers to intervene before questionable treatment escalates.

3. Investigate Policy Level Fraud

Fraud doesn’t always begin with the accident. Policy level misrepresentations  — such as false garaging locations, unlisted household residents, or misrepresented vehicle use — can undermine coverage entirely. Scrutinizing these issues early can support dismissal applications under the PIP rules.

4. Use the PIP Arbitration Rules to Your Advantage

Rule 35 of the New Jersey No Fault PIP Arbitration Rules provides a mechanism for pre hearing dismissal when coverage requirements are not met. As the document notes:

“If any party contends that… there is no coverage or Forthright lacks subject matter jurisdiction, such party may apply for an Order dismissing the case prior to hearing.”

A well supported dismissal application — including policy provisions, factual support, and documentation — can resolve a dispute before it reaches a hearing.

5. Analyze Treatment Records for Patterns

Fraud rarely occurs in isolation. Comparing CPT codes, treatment patterns, and provider behavior across multiple cases can reveal systemic issues. Reviewing prior arbitration awards involving the same providers can also uncover recurring credibility concerns or previously identified irregularities.

6. Use SIU Strategically

SIU involvement is most effective when timed to coincide with treatment phases and targeted to specific concerns. Preparing SIU investigators with focused questions and clear objectives enhances credibility assessments and strengthens the evidentiary record.

7. Leverage the EUO Effectively

Examinations Under Oath remain one of the most powerful tools in the investigative arsenal. Choosing between recorded statements and EUOs depends on timing and strategic goals. Records should be used to challenge inconsistencies in patient testimony and to test the reliability of the claimant’s narrative.

8. Prepare Your Arbitration Submission Thoughtfully

A strong submission clearly identifies:

  • The legal issues
  • The evidence supporting your position
  • How the facts align with your defense theory

While written submissions are important, oral hearings often make the difference. DRPs value clarity, organization, and a well articulated argument.

9. Coach Your Witnesses

Witness credibility can make or break a case. Preparing witnesses for cross examination ensures they present confidently and consistently. DRPs evaluate demeanor, clarity, and the ability to explain complex issues without overreaching.

10. Understand DRP Limitations — and Read Between the Lines

DRPs decide cases based on the evidence presented, not investigative instincts. The civil burden of proof and limited credibility assessments shape outcomes. However, award language often contains subtle cues that can guide broader fraud detection efforts. Arbitration outcomes should be treated as investigative leads, not endpoints.

Conclusion

Fraud in New Jersey PIP claims continues to evolve, and carriers must adapt accordingly. By understanding the arbitration process, identifying red flags early, and presenting well supported cases, insurers can more effectively combat fraudulent activity while ensuring legitimate claimants receive the benefits they are entitled to.

These ten recommendations reflect a DRP’s perspective — one grounded in thousands of cases, systemic investigations, and a deep understanding of how fraud manifests in the PIP environment. With thoughtful preparation and strategic execution, carriers can significantly improve their ability to detect, challenge, and prevent fraudulent claims.

Firm Highlights

Event

CLM 2026 Focus Conference

Allison joins three insurance industry leaders to discuss how cyber coverage disputes, the growing impact of social inflation on bodily injury claim valuation, and the use of artificial intelligence are reshaping the bad faith landscape. The panel will examine emerging sources of extra-contractual exposure, including evolving cyber insurance coverage issues and the challenges of accurately valuing bodily injury claims. Practical approaches to claim evaluation using AI, along with defense strategies designed to help prevent or successfully defend against bad faith litigation, will also be addressed. 

Complete Victory Obtained in a Workers’ Compensation Matter

Result

Complete Victory Obtained in a Workers’ Compensation Matter

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Marshall Dennehey Announces 2027 New Jersey Super Lawyers And Rising Stars

Bret E. Dubbert Joins Marshall Dennehey’s Orlando Office as Special Counsel in the Casualty Department

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Bret E. Dubbert Joins Marshall Dennehey’s Orlando Office as Special Counsel in the Casualty Department

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Result

Summary Judgment Obtained in Insurance Coverage Case

Thought Leadership

Florida Supreme Court Rules Florida Statute §627.70152 Does not Apply Retroactively

In a decision that resolves years of appellate uncertainty and confirms that insurers and insureds alike can rely on the legal framework in place when a policy is issued, the Supreme Court of Florida last week found that Florida Statute §627.70152, which involves an insured’s requirement to provide an insurer with pre-suit notice before filing a suit, cannot be applied retroactively. In Universal Property & Casualty Insurance Company v. Hughes, the Court was presented with the issue of whether the statutory pre-suit notice requirement applied retroactively and whether it would apply to a breach of contract of an insurance policy that was issued before the statute went into effect. Before the Court was an appeal from a homeowner, Ms. Hughes, who sued her insurance carrier, Universal Property & Casualty Insurance Company (Universal) for breach of contract under an insurance policy that was in effect from April 24, 2019 through April 24, 2020. During the policy period, Ms. Hughes suffered a loss and, on May 29, 2019, made a claim for water damage. The carrier investigated the loss and issued payment; Ms. Hughes disputed the payment, finding the amount insufficient for repairs. On July 1, 2021, Florida Statute §627.70152 went into effect, which required insureds to provide notice of intent to initiate litigation against the carrier prior to filing a lawsuit; if an insured filed the lawsuit without complying with §627.70152, a court must dismiss the case without prejudice. On August 4, 2021, Ms. Hughes filed her lawsuit against Universal for breach of contract. Universal moved to dismiss based on her failure to comply with §627.70152. Ms. Hughes contended the notice requirement could not be applied retroactively. The trial court disagreed and dismissed the lawsuit without prejudice, and Ms. Hughes appealed. During the appeal, the Fourth District Court of Appeal, in Cole v. Universal Property & Casualty, 363 So. 3d 1089 (Fla. 4th DCA 2023), ruled that Florida Statute §627.70152 did apply retroactively to policies issued before the effective date of §627.70152. However, the Sixth District Court agreed with Ms. Hughes and overturned the trial court’s ruling, finding the statute could not retroactively apply to policies issued prior to the statute effective date. Thereafter, the other district courts weighed in, with the Third District Court agreeing with the Fourth District Court, and the First, Second and Fifth District Courts agreeing with the Sixth District Court. In resolving the conflict amongst the district courts, the Supreme Court advised “as a general rule, ‘the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract.’ Hassen v. State Farm Mut. Auto. Ins. Co., 674 So. 2d 106, 108 (Fla. 1996). The Court applied the two-step test when deciding whether a statute has retroactive application: “First, the Court must ascertain whether the Legislature intended for the statute to apply retroactively. Second, if such an intent is clearly expressed, the Court must determine whether retroactive application would violate any constitutional principles.” Menendez v. Progressive Exp. Ins. Co., 35 So. 3d 873, 877 (Fla. 2010). In analyzing the Legislature’s intent, the Court must determine whether the Legislature has manifested a clear command for retroactivity in the statutory text.  In review of the statutory text, the Court found nothing in the language of the statute to indicate that the phrase “all suits” was serving another purpose of expanding its reach to suits based on policies that both predate and postdate the enactment of the statute. Buis v. Universal Prop. & Cas. Ins. Co., 394 So. 3d 738, 741 (Fla. 2d DCA 2024). Further, the Court noted the statute has an effective date, which has long been considered to be evidence against retroactive application of a statute. The Court concluded that, on its face, no provision of §627.70152 speaks to application of the statute to insurance policies issued before the statute’s effective date and therefore, the Legislature did not clearly command retroactivity of the statute to include insurance policies issued prior to the enactment of the statute. The Court briefly reviewed Universal’s argument that the presuit notice requirement was procedural, not substantive, and therefore should be applied retroactively; however, the Court agreed with the Sixth District Court’s finding that, in its entirety, §627.70152 transformed an insured’s ability to sue an insurance company under a property insurance policy and an insurer’s obligations to respond to and pay insurance claims, thus making the requirement a substantive change. The Court thereby upheld the decision of the Sixth District and disapproved the decision of the Fourth District in Cole.

Thought Leadership

The Tolling Trap: Filing Alone Will Not Toll the Statute Without Good-Faith Service

The Eastern District of Pennsylvania recently reinforced a critical limitation on bad faith claims, holding that a timely filing alone will not preserve a cause of action absent a good-faith effort to serve the original process. The plaintiff had presented a claim for underinsured motorist benefits to his auto insurer. The insurer evaluated the claim and determined that the plaintiff’s accident-related damages did not exceed the bodily injury liability insurance limits of the at-fault driver and denied his claim. Among other claims, the plaintiff sought to present a claim for insurance bad faith under 42 Pa. C.S.A. § 8371, to which a two year statute of limitation applies. He first filed a praecipe for writ of summons before the expiration of the statute of limitation. However, the plaintiff did not attempt to serve the praecipe or writ until after the statute of limitations had expired. Additionally, the service failed as the plaintiff had mailed the original process to an incorrect address. Despite receipt of the Postal Service’s failure to deliver the original process, the plaintiff did not attempt to re-serve the writ. Two months later, the plaintiff filed a complaint and then successfully served that complaint. The insurer sought to dismiss the plaintiff’s bad faith claim as time-barred by the statute of limitations. The district court agreed. Though the plaintiff had filed a praecipe for a writ of summons prior to the expiration of the statute of limitations, the statute is only tolled if there is a good faith effort to serve that original process. In this case, the court determined that the plaintiff had failed to perform a “good faith effort to serve the original process”. Additionally, though the filing and service of a complaint can serve as alternative original process when the lawsuit is commenced by the filing of a praecipe for a writ of summons, the plaintiff filed his complaint after the statute of limitations had expired. The plaintiff’s bad faith claim was therefore determined to be barred by the statute of limitations and dismissed by the court, with prejudice. A key takeaway for the defense is not to assume that the statute of limitations has been successfully tolled by a plaintiff merely because a praecipe for a writ of summons or complaint has been filed prior to the expiration of the statute. A filed complaint or writ is only part of the equation. The defense should carefully review the docket and filings to confirm that the plaintiff also performed the requisite good faith effort to serve that original process. A thorough review of the docket may reveal that the plaintiff failed to make the good-faith service efforts necessary to toll the statute of limitations.

Defense Victory Obtained in Workers’ Compensation Case

Result

Defense Victory Obtained in Workers’ Compensation Case

Marshall Dennehey Named a Standout in Litigation by BTI Consulting Group

News

Marshall Dennehey Named a Standout in Litigation by BTI Consulting Group

Thought Leadership

Commonwealth Court Reaffirms the Constitutionality of Act 111's IRE Provisions

In this case, the claimant sustained a work injury of January 6, 1994, which was acknowledged by Notice of Compensation Payable (NCP). After the claimant’s receipt of 104 weeks of temporary total disability benefits, the employer filed a Request for an Impairment Rating Examination (IRE). The IRE was performed in May 2023 and the IRE physician found that the claimant had a 5% whole person impairment, under the AMA Guides. The employer filed a Petition based on the IRE results, and the Petition was granted by the WCJ. During litigation, the claimant argued that the IRE provisions of Act 111 (Section 306(a.3) of the Act) were not applicable to her injury, since it predated June 24, 1996, the date Act 57 went into effect, and that the IRE provisions were unconstitutional. The Workers’ Compensation Judge (WCJ)) granted the Petition and the Board affirmed. On appeal to the Commonwealth Court, the claimant argued that Act 111 violated the nondelegation doctrine and that its retroactive application to the claimant’s injury was unconstitutional. The court rejected the arguments on the basis that they had already found the same arguments without merit in multiple, prior cases. The court also addressed an argument made by the claimant that Act 111 was procedurally defective under the Pennsylvania Constitution because it was only considered on two days in each House after having undergone amendments and reassignments. The court noted that the Pennsylvania Constitution requires every bill to be considered on three different days in each House. The claimant maintained that, according to the legislative history, the bill did not receive three separate days of consideration from each House when it was assigned a new bill number. The court pointed out, however, that the bill number, H.B. 1840 remained constant and was considered on three occasions by the House. Further, the court concluded that minor amendments to the bill were germane to its original subject, which was to modify the Act’s IRE process, in accordance with Protz II.