On July 15, 2026, the New Jersey Supreme Court issued a decision overturning lower court rulings that had shielded “semi-professionals” — including insurance brokers, agents, and producers, among others — from regulation and litigation under the New Jersey Consumer Fraud Act (NJCFA).

The Supreme Court’s opinion in Lowe v. Audet will have a significant and immediate impact on the insurance industry in New Jersey. Now, insurance brokers, agents, and producers — and their employers — must ensure they are compliant with the NJCFA, which includes a private right of action and is enforced by the New Jersey attorney general (AG) and the Division of Consumer Affairs. By subjecting these insurance industry participants to the NJCFA — and to regulation by agencies other than the New Jersey Department of Banking and Insurance — the decision is likely to create uncertainty as to how the requirements of the NJCFA will be integrated into established legal frameworks specific to insurance.

More broadly, the New Jersey Supreme Court’s decision expands the reach of the NJCFA by significantly narrowing a longstanding exception for “learned professionals,” while signaling that the Court may eliminate the exception entirely if the state’s legislature does not step in to clarify the statute’s reach.

Background

New Jersey courts frequently describe the NJCFA as one of the nation’s strongest consumer protection statutes. For decades, however, the New Jersey Supreme Court has interpreted the NJCFA to include an implied carveout for “learned professionals,” which lower courts have extended to encompass “semi-professionals.” Many other state statutes governing unfair and deceptive acts and practices do not include this exception.

More recently, the New Jersey AG and lower court judges have questioned the validity and scope of the “learned professionals” exception. They have suggested that the exception is not rooted in the statute’s text, called for revisiting precedents that expanded its reach, and rejected application of the exception to occupations such as home inspectors.

Despite the doubts recently cast on the “learned professionals” exception, the state’s intermediate appellate court in Lowe v. Audet reaffirmed the doctrine and held that insurance brokers are “semi-professionals” who fall within the exception. As a result, the plaintiff in the case — a surgeon who was partially denied coverage under a disability insurance policy obtained through the defendant insurance broker — could not sue the insurance broker under the NJCFA for alleged fraud, deception, and unconscionable commercial practices in marketing and selling the insurance policies, including by allegedly omitting and concealing material facts with the intent to mislead consumers.

New Jersey Supreme Court Decision

In reversing the lower court’s decision, the New Jersey Supreme Court began by reviewing the history of the “learned professionals” exception, which grew out of judicial decisions concluding that the NJCFA was not intended to apply to professionals such as physicians and attorneys who were prohibited from advertising their services at the time the statute was enacted in 1960. Since then, lower courts had applied the exception to other professionals and “semi-professionals.” But these decisions, the Court explained, were not consistent in their approach and had stretched the exception beyond its original rationale and to a point where it undermined the remedial purpose underlying the NJCFA.

As a result, the Supreme Court ruled that semi-professionals like insurance brokers, producers, and agents are generally subject to — not exempt from — the NJCFA.

The Supreme Court did not eliminate the “learned professionals” exception entirely. Although the Court observed that the exception “does not appear in the text of the [NJCFA]” and that the Court has “serious doubts about the basis” for the exception, the Court decided to “await a case that presents a direct challenge to address it.” In the meantime, the Court “invite[d] the Legislature to provide clarity about whether certain professionals are exempt from liability under the [NJCFA], and if so, to identify the relevant professionals.”

Why It Matters

Insurance professionals who do business in New Jersey — and companies that employ them — are immediately subject to new regulatory and litigation risks. The potential exposure is significant. Private plaintiffs can recover treble damages, attorneys’ fees, and costs, among other relief.

In addition, the NJCFA is enforced by the AG and Division of Consumer Affairs, which may impose civil penalties of up to $10,000 for the first violation and $20,000 for subsequent violations. These regulators may wield their new authority in ways that the insurance industry’s primary state regulator, the Department of Banking and Insurance, would not. At a time when state AGs are focused on affordability and insurance costs have been increasing, the insurance industry should anticipate heightened regulatory scrutiny.

As a result, insurance industry participants should immediately review their policies and procedures for compliance with the NJCFA and its implementing regulations. This review should include advertising, pricing, disclosures, and product tie-ins. Companies also should evaluate practices that have drawn recent criticism from state AGs, such as “junk fees.”

Integrating the NJCFA into the established legal frameworks governing the conduct of insurance brokers, producers, and agents will present complex legal questions that must be addressed in a newly unsettled and uncertain regulatory context. There may be instances in which certain applications of the NJCFA would be inconsistent with — and give way to — laws specific to the insurance industry. On the other hand, the AG and Division of Consumer Affairs may seek to address violations of insurance laws by treating those violations as violations of the NJCFA, subject to the NJCFA’s distinct penalty structure. 

The impact of the New Jersey Supreme Court’s decision will not be limited to the insurance industry. Practitioners of other professions that may be characterized as “semi-professionals” now face increased litigation and regulatory risks, which they similarly should take steps to mitigate. And the Court’s “serious doubts” about the “learned professionals” exception suggest that even physicians and attorneys may soon find themselves subject to the NJCFA.

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Troutman Pepper Locke State Attorneys General Team

	Ashley Taylor – Co-leader and Firm Vice Chair Ashley is co-leader of the firm’s nationally ranked State Attorneys General practice, vice chair of the firm, and a partner in its Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group. He helps his clients navigate the complexities involved with multistate attorneys general investigations and enforcement actions, federal agency actions, and accompanying litigation.
	Clay Friedman – Co-leader Clay co-leads the firm’s State Attorneys General practice and is nationally ranked by Chambers USA for AG Government Relations and in Best Lawyers for Advertising Law. He has dedicated his entire career to state attorney general and federal work, serving for nearly a decade in a senior role and more than 25+ years in private practice. Clay focuses his practice on helping industry-leading companies mitigate the risks associated with state and federal regulatory investigations and associated litigation.
	Chris Carlson Chris advises clients on regulatory, civil, and criminal investigations and litigation. With a background as an assistant attorney general, he provides practical guidance to clients with matters involving state attorneys general and federal regulatory agencies.
	Lauren Fincher Lauren has vast experience handling state attorneys general investigations, navigating complex regulatory compliance matters, and providing strategic counsel in enforcement actions across various industries. She helps clients manage high-stakes regulatory matters and guides them through complex legal landscapes.
	Stephen Piepgrass Stephen leads the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, representing clients in single and multistate enforcement actions, including inquiries and investigations involving state attorneys general and other state and federal governmental enforcement bodies including the CFPB and FTC. He regularly represents clients in highly regulated sectors such as financial services, emerging technologies, health care, insurance, and education.
	Michael Yaghi Mike handles high-profile investigations led by state attorneys general, the FTC, and other federal and state regulatory bodies. He assists clients through these complex government inquiries, assisting them throughout the entire life cycle of investigations, from regulatory enforcement through formal litigation.
	Matthew J. Berns Drawing on his experience in senior leadership roles in the New Jersey Attorney General’s and Governor’s Offices and as a trial attorney for the U.S. Department of Justice, Matt provides an insider’s perspective when guiding clients through complex government investigations, litigation, and other actions.
	Jeff Johnson Jeff helps clients navigate complex regulatory and litigation challenges with local, state, and federal authorities. His clients benefit from his decade of broad litigation experience, understanding of emerging state and federal regulatory issues, and strong relationships with attorneys general across the U.S. In addition to handling cases from trial through state or federal appeals, Jeff serves as amicus counsel in advancing legal rules to support his clients’ vital interests.
	Jay Myers Jay assists clients in heavily regulated industries, including health care, energy, insurance, emerging industries, and data privacy. He provides both regulatory legal advice and government relations strategies. Jay’s past and current clients include Fortune 10 companies, startups, nonprofits, industry associations, and advocacy groups. Recognizing that state government matters are often complex and multifaceted, he utilizes regulatory guidance, government advocacy, or both in tandem to deliver tailored solutions for each client’s unique needs.
	Zoe Schloss Zoe represents clients in litigation and government investigations. As former deputy attorney general for the Delaware Department of Justice, she is an experienced litigator who understands the enforcement priorities that impact her clients. Zoe works with individuals and corporate entities in highly regulated industries, including financial services, health care, and energy.
	Jessica Birdsong Jessica is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice Group. She received her J.D. from the University of Richmond School of Law, magna cum laude, where she served as associate articles editor of the Journal of Law & Technology.
	Sydney Goldberg Sydney is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group. She advises clients on regulatory compliance and state attorney general (AG) investigations in highly regulated industries, including health care and life sciences. She routinely helps clients navigate alcohol compliance and licensing issues, helping proactively manage regulatory risk.
	Troy Homesley Troy is an accomplished litigator who has represented and defended clients across a wide range of complex, high-stakes disputes at both the trial and appellate levels. He has represented technology companies, business executives, law firms, investment funds, high-ranking federal officials, international non-profits, and asylum seekers. Troy draws on his broad litigation experience to advise clients before litigation arises, while claims are pending or threatened, and leading up to and through trial and appeals.
	Namrata Kang Namrata (Nam) is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement (RISE) Practice Group, based in the Washington, D.C. office. She routinely advises clients on a wide variety of state and federal regulatory matters, with a particular emphasis on state consumer protection laws relating to consumer financial services and marketing and advertising. Nam’s experience transcends multiple industries, including financial services, telecommunications, media, and sports betting.
	Michael Lafleur Michael is an associate in the firm’s Regulatory Investigations, Strategy, and Enforcement Practice Group. Based out of the firm’s Boston office, Mike has deep experience in litigation, investigations, and other regulatory matters involving state-level regulators and state attorneys general.
	William LaRosa Bill represents clients in complex regulatory investigations, state attorneys general matters, and enforcement proceedings. He draws on his experience as a former assistant U.S. attorney and as a private-sector litigator advising corporations in high-stakes litigation and regulatory investigations, including multistate AG investigations.
	Philip Nickerson Philip’s diverse practice includes representation of financial, tech, real estate, and energy companies in a range of government investigation and litigation matters. With experience obtaining favorable results for clients as a first and second-chair litigator in state and federal trial courts, arguing before federal courts of appeal, and representing clients in arbitration proceedings, he understands the importance of tailoring litigation strategy to align with clients’ goals.
	Lane Page Lane represents financial institutions and other clients in federal and state regulatory investigations and complex civil litigation. He is particularly focused on consumer protection and fair lending issues.
	Dascher Pasco Dascher provides strategic counsel and representation to clients navigating regulatory compliance, enforcement, and high-stakes litigation. She regularly represents clients in both single and multistate state attorney general (AG) investigations and enforcement actions, as well as before other state enforcement bodies and local government agencies.
	Kyara Rivera Rivera Kyara is an associate in the firm’s Regulatory Investigations, Strategy + Enforcement Practice Group. She received her J.D. from the University of Richmond School of Law, cum laude, where she served as publications and online editor of the Public Interest Law Review.
	Timothy Shyu Timothy advises clients on regulatory compliance and enforcement in highly regulated industries, including health care and life sciences, data privacy and cybersecurity, and emerging technology. He assists companies in navigating complex investigations and enforcement actions, helping them mitigate regulatory risk proactively.
	Trey Smith Trey focuses his practice on representing and advising regulated utilities before state public utility commissions. He routinely helps clients obtain certificates of public convenience and necessity for transmission infrastructure. In this role, Trey works with his clients’ subject-matter experts to manage administrative proceedings, including by preparing initial filings; responding to discovery requests; drafting rebuttal testimony; and litigating any disputed issues.
	Daniel Waltz Dan helps clients navigate all aspects highly regulated relationships between industry participants and federal, state and local governments. Whether engaging with regulators, negotiating transactions or representing clients in the courtroom, he delivers solutions that help his clients achieve their strategic goals.
	Stephanie Kozol Stephanie is Troutman Pepper Locke’s senior government relations manager in the state attorneys general department.