Proposed Amendments: N.J.A.C. 13:44D-2.1, 3.1, 4.5 and 4.8 and 13:44D Appendix A
Proposed New Rule: N.J.A.C. 13:44D-4.5A

License to Engage in the Business of Public Moving and/or Storage; Tariffs; Legal Liability; and Insurance
 
Authorized By: Division of Consumer Affairs, David M. Szuchman, Director.
Authority: N.J.S.A. 45:14D-6.
 
Calendar Reference: See Summary below for explanation of exception to calendar requirement.
 
Proposal Number: PRN 2009-265.
 
Submit written comments by November 7, 2009 to:
   David M. Szuchman, Director
   Division of Consumer Affairs
   Post Office Box 45027
   Newark, New Jersey 07101
 
The agency proposal follows:
 
Summary

In a May 27, 2008, letter, Robert Russo, Executive Director of the New Jersey Warehousemen and Movers Association, requested the Division of Consumer Affairs (Division) to amend N.J.A.C. 13:44D to recognize that public movers and/or warehousemen may offer increased valuation to consumers. Increased valuation is a contractual agreement by which a public mover and/or warehouseman and a consumer set an amount at which a specific item or items or all of a consumer's goods, which are damaged or destroyed while being transported by the public mover and/or warehouseman, will be reimbursed by the public mover and/or warehouseman. After reviewing this request, and determining how such increased valuation should be insured by public movers and/or warehousemen, the Director of the Division (Director) has determined to amend N.J.A.C. 13:44D as requested by Mr. Russo.

The Director proposes to amend N.J.A.C. 13:44D-2.1 to clarify language and to update a citation to the rule dealing with insurance requirements, which is proposed as new rule N.J.A.C. 13:44D-4.5A. The Director proposes to amend N.J.A.C. 13:44D-3.1 to require that public movers and/or warehousemen's tariffs include increased valuation rates.

The Director proposes to amend N.J.A.C. 13:44D-4.5(a) to recodify a portion of this rule as new subsection (d). Proposed new N.J.A.C. 13:44D-4.5(b) and (c) recognize that public movers and/or warehousemen may offer consumers increased valuation. The amount of increased valuation offered must be limited either to the amount of the general cargo liability insurance held by the licensed public mover and/or warehouseman or to an increased amount covered by insurance purchased specifically for that move.

Existing subsections (b) through (j) in N.J.A.C. 13:44D-4.5 deal with insurance. The Director proposes to recodify these provisions in proposed new rule N.J.A.C. 13:44D-4.5A, which will deal solely with insurance requirements. While most of these provisions are proposed for recodification without change, the Director proposes to amend some provisions. The existing rule has separate provisions for legal liability coverage and cargo liability. These two insurance requirements cover the same topic, cargo liability coverage, and the Director has combined these provisions in the proposed new rule. The existing rule requires public movers and/or warehousemen to obtain cargo liability for loss or damage to property on any one vehicle for $ 5,000 per accident and for loss or damage occurring at any one place for $ 10,000. These amounts have been unchanged since August 7, 1989 (21 N.J.R. 3020(a)). The Director proposes to increase these limits to $ 25,000 for loss or damage to property on any one vehicle and to $ 50,000 for loss or damage to property at any one place, amounts that are more reflective of the insurance the public movers currently opt to maintain.

The Director proposes new subsection (f), which requires public movers and/or warehousemen who use the services of owner/operators to cover the public movers and/or warehousemen for acts or omissions of owner/operators. This requirement is imposed by N.J.S.A. 45:14D-25.1 and is also codified in N.J.A.C. 13:44 D-4.8 . The Director is including this requirement in proposed new N.J.A.C. 13:44D-4.5A, so that all insurance requirements are covered by the proposed new rule.

The Director proposes to amend N.J.A.C. 13:44D-4.8 to reflect the recodification of insurance requirements in proposed new N.J.A.C. 13:44-4.5A. The Director proposes to amend Appendix A to include references to increased valuation.

The Director has determined that the comment period for this notice of proposal will be 60 days; therefore, pursuant to N.J.A.C. 1:30-3.3(a)5, this notice is excepted from the rulemaking calendar requirement.
 
Social Impact

Ensuring that public movers and/or warehousemen have adequate insurance to cover any reimbursement for which they may be liable under an agreed upon increased valuation will benefit consumers. Increasing the minimum amount of cargo liability insurance that public movers and/or warehousemen are required to carry will also benefit consumers. The Director does not believe that the amendments and new rule will have any other impact on society in general or public movers and/or warehousemen in particular.
 
Economic Impact

The proposed amendments and new rule will impose costs on public movers and/or warehousemen who offer increased valuation in an amount that would exceed their cargo liability insurance. Such public movers and/or warehousemen will be required to contract for an increase in cargo liability insurance for that one move. The cost for this cargo liability insurance may be passed onto customers. The amendments will also impose additional costs on public movers and/or warehousemen by requiring them to increase cargo liability coverage for loss or damage to property on a vehicle and for loss or damage to property at any one location. The cost for this increased liability coverage may be passed onto customers.
 
Federal Standards Statement

A Federal standards analysis is not required because there are no Federal laws or standards applicable to the proposed amendments and new rule.
 
Jobs Impact

The Director does not believe that the proposed amendments and new rule will result in an increase or decrease of jobs in this State.
 
Agriculture Industry Impact

The Director does not believe that the proposed amendments and new rule will have any impact on the agriculture industry of this State.
 
Regulatory Flexibility Analysis

Since public movers and/or warehousemen are individually licensed, under the Regulatory Flexibility Act (the Act), N.J.S.A. 52:14B-16 et seq., they may be considered "small businesses" for the purposes of the Act.

The costs imposed by the proposed amendments and new rule are the same for all public movers and/or warehousemen as outlined above in the Economic Impact statement. The Director does not believe that public movers and/or warehousemen will need to employ any professional services to comply with the requirements of the amendments and new rule. The proposed amendments and new rule impose no recordkeeping or reporting requirements, but imposes compliance requirements as detailed in the Summary above.

The proposed amendments and new rule protect the public by increasing the minimum amount of cargo liability and by ensuring that public movers and/or warehousemen who offer increased valuation have sufficient insurance to cover any reimbursement amount agreed to by [page=3201] public movers and/or warehousemen and consumers. As such, no differing compliance requirements are imposed upon any public mover and/or warehouseman based upon their size.
 
Smart Growth Impact

The Director does not anticipate that the proposed amendments and new rule will have any impact on the achievement of smart growth and implementation of the State Development and Redevelopment Plan, otherwise known as the State Plan.
 
Housing Affordability Impact

The proposed amendments and new rule will have an insignificant impact on affordable housing in New Jersey and there is an extreme unlikelihood that the rules would evoke a change in the average costs associated with housing because the proposed amendments and new rule concern insurance requirements for, and increased valuation offered by, public movers and/or warehousemen.
 
Smart Growth Development Impact

The proposed amendments and new rule will have an insignificant impact on smart growth and there is an extreme unlikelihood that the rules would evoke a change in housing production in Planning Areas 1 or 2 or within designated centers under the State Development and Redevelopment Plan in New Jersey because the proposed amendments and new rule concern insurance requirements for, and increased valuation offered by, public movers and/or warehousemen.
 
Full text of the proposal follows (additions indicated in boldface thus; deletions indicated in brackets [thus]):
 
13:44D-2.1   License to engage in the business of public moving and/or storage
 
(a) (No change.)
 
(b) An applicant for licensure as a public mover and/or warehouseman shall submit to the Director:
 
1. (No change.)
 
2. Certificates of insurance evidencing coverage [of workers' compensation (when such coverage is required under] required by N.J.S.A. 34:15-77 and 78[)], and certificates of insurance evidencing coverage for the operation of motor vehicle equipment, cargo, storage facilities and property being held in storage, conditioned or providing for the payment of all judgments recovered against a public mover and/or warehouseman in the manner and amounts specified in N.J.A.C. 13:44D-[4.5]4.5A(e);
 
3.-5. (No change.)
 
(c)-(j) (No change.)
 
13:44 D-3.1   Tariffs
 
(a)-(b) (No change.)
 
(c) Each tariff shall consist of the following minimums:
 
1.-4. (No change.)
 
5. Rate schedule shall include, but not be limited to, the following:
 
i. For public movers: combination weight and mileage rates, hourly rates, increased valuation rates and any other rates charged.
 
ii.-iii. (No change.)
 
6.-7. (No change.)
 
(d)-(f) (No change.)
 
SUBCHAPTER 4.    GENERAL PROVISIONS
 
13:44 D-4.5   Legal liability [and insurance]
 
(a) The public mover and/or warehouseman may, by contract with the consumer, limit liability for loss or damage to goods in storage or in transit. The minimum amount[,] to which a public mover and/or warehouseman may limit liability is $.60 per pound per article.
 
(b) A public mover and/or warehouseman may contract with a consumer for increased valuation for loss or damage for all items, or specific items, being moved or stored. A public mover and/or warehouseman who offers increased valuation shall limit the amount of increased valuation to the amount of his or her cargo liability insurance, except as provided in (c) below. For instance, if a public mover and/or warehousemen has cargo liability insurance that covers $ 25,000 per accident for loss or damage to property being transported, he or she shall offer no more than $ 25,000 of increased valuation.
 
(c) A public mover and/or warehouseman may offer increased valuation that exceeds his or her cargo liability insurance if he or she contracts to increase cargo liability insurance to an amount that covers the increased valuation. For instance, if a public mover and/or warehousemen offers $ 50,000 of increased valuation and has cargo liability insurance that only covers $ 25,000, he or she shall arrange for his or her insurance policy to cover $ 50,000 for that one move.
 
(d) [The] An order for service shall specifically state the public mover's and/or warehouseman's liability. Any limitation shall be null and void and the public mover and/or warehouseman shall be subject to full liability if any of the following occurs:
 
1.-4. (No change.)
 
13:44D-4.5A   Insurance
 
[(b)] (a) Every licensed public mover and/or warehouseman shall secure, maintain and file with the Director a certificate of insurance from an insurance company authorized and licensed to do business in this State covering the motor vehicle, cargo, storage facilities and property being held in storage for the amounts set forth in [(c)] (b) below, conditioned or providing for payment of all judgments recovered against such public mover and/or warehouseman.
 
[(c)] (b) The minimum amounts of insurance a public mover shall secure and maintain are:
 
1. [Legal] Cargo liability coverage at the rate of $.60 per pound per article, which, at a minimum, covers:
 
i. For loss or damage to property being transported (cargo liability insurance) on any vehicle: $ 25,000 per accident; and
 
ii. For loss or damage to or aggregate of losses or damages of or to property occurring at any one time and place: $ 50,000; and
 
2. Bodily injury liability, property damage liability:
 
i. (No change.)
 
ii. Limit for bodily injuries to or death of all persons injured or killed in any one accident: $ 100,000, subject to a maximum of $ 25,000 for bodily injuries or death of one person; and
 
iii. Limit for loss or damage in any one accident to property of others (excluding cargo): $ 10,000[; and].
 
[3. Cargo liability:
 
i. For loss or damage to property being transported (cargo liability insurance) on any one vehicle: $ 5,000 per accident;
 
ii. For loss or damage to or aggregate of losses or damages of or to property occurring at any one time and place: $ 10,000.]
 
[(d)] (c) The minimum amounts of insurance for warehousemen are:
 
1. [Legal] Warehousemen liability coverage at the rate of $.60 per pound per article.
 
Recodify existing (e) and (f) as (d) and (e) (No change in text.)
 
(f) If a public mover uses the services of owner/operators, the insurance policies of a public mover holds pursuant to (b) above shall cover the public mover's liability for acts or omissions of the owner/operators used by the public mover.
 
(g)-(h) (No change.)
 
(i) Where a consumer requests the public mover and/or warehouseman to obtain [additional] increased coverage, specifically insurance, and the consumer pays the [additional] premium for the increased coverage, the public mover and/or warehouseman shall furnish the consumer with a certificate of insurance. Such certificate shall include the following:
 
1.-7. (No change.)
 
(j) (No change.)
 
13:44D-4.8   Use of an owner-operator
 
(a)-(f) (No change.)
 
(g) A public mover shall add any owner-operator who provides moving services for the public mover as an additional covered insured under the public mover's insurance policies, which he or she is required to hold pursuant to N.J.S.A. 45:14D-25 and N.J.A.C. 13:44D-[4.5(b)]4.5A.
 
(h)-(j) (No change.)
 
[page=3202] APPENDIX A
 
IMPORTANT NOTICE TO CONSUMERS USING PUBLIC MOVERS AND WAREHOUSEMEN
 . . .
 
MOVER'S RESPONSIBILITY FOR LOSS AND DAMAGE

Unless you have additional insurance, the mover is, in most cases, only required to reimburse you for any damages to your belongings at the rate of $.60 per pound. For example, if you have a vase valued at $ 1,000 but it only weighs two pounds, the mover is, in most cases, only required to reimburse you the sum of $ 1.20. For your own protection, consider discussing with your insurance agent whether you should purchase additional [insurance] coverage, either from an insurance company or through the mover, or confirm that an existing insurance policy would protect your goods in transit or storage. If you decide to purchase insurance through the mover, the mover must issue you a certificate of insurance (sometimes called "an advice of coverage") as proof of purchase which must be fully completed with all the policy's terms.
 
When purchasing insurance, consider:
 
1.-2. (No change.)
 
A public mover may contract with you for increased valuation for loss or damage for all items, or specific items, being moved. The amount of increased valuation a mover may offer is limited by the amount of cargo liability insurance the mover carries. A public mover may contract with his or her insurance company to increase cargo liability insurance for an individual move in order to cover increased valuation offered for that individual move.
. . .
 
GLOSSARY OF MOVING TERMINOLOGY
. . .
 
"Increased valuation" means a process by which a public mover and a consumer agree that all items, or specific items, in a shipment will be reimbursed for loss or damage by the mover at a rate greater than the standard $.60 per pound.
. . .