New Jersey Car Insurance Laws

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In 2019, there were 278,413 accident reported to the New Jersey Department of Transportation. In 2020, there were 531 deaths. This is nearly 5% more than the previous year.

New Jersey law requires that you have car insurance . To protect themselves and others on the roads, drivers must comply with certain coverage requirements. Continue reading to find out more about New Jersey’s car insurance laws.

New Jersey’s Car Insurance Laws

New Jersey’s insurance laws are simple and straightforward. These laws were created to protect drivers and provide adequate coverage. These are the New Jersey car insurance rules that every driver should know:

  • Drivers must comply with minimum coverage requirements: All drivers in New Jersey must have minimum liability and uninsured motorist coverage.
  • Drivers are required to have no-fault insurance. New Jersey, a state that is no-fault, requires drivers to have no-fault auto insurance.
  • Drivers need to have proof of insurance. Drivers should always have proof of insurance in their car. New Jersey accepts both physical documentation and electronic ID cards as proof of insurance.
  • All drivers have the right to car insurance. New Jersey drivers have the right to purchase a policy for their vehicle. Drivers who cannot afford standard coverage or are denied coverage can buy a Basic policy under the Automobile Insurance Cost Reduction Act. Additionally, New Jersey drivers who are on federal Medicaid with hospitalization benefits qualify for minimum coverage is:
    • $15,000 bodily injury liability coverage per individual
    • $30,000 per accident in bodily injury liability coverage
    • $5,000 per accident in property damage liability coverage
    New Jersey drivers tend to opt for more coverage than is necessary. Car accidents can be costly. Liability-only coverage does not cover the costs of damages resulting from an at-fault collision.Imagine that you hit another driver at a red light, causing $30,000 in damage to their car. You would need minimum coverage to cover $5,000 of property damage. This means that you would have $25,000 more in your pocket.Is New Jersey a state of no fault?New Jersey is a state that has no fault. No matter who caused the accident, drivers’ insurance companies will pay for medical expenses and lost wages. The insurance company of the at-fault driver is responsible for paying the medical bills.New Jersey is a state that does not require drivers to have Personal Injury Protection (PIP). New Jersey’s minimum required PIP insurance is $15,000 per individual or per accident. However, drivers have the option to increase their coverage to $250,000 or greater.New Jersey Penalties for Driving Without InsuranceIt is illegal to drive without New Jersey car insurance. Being caught driving without insurance can lead to severe consequences. This includes possible license suspension and fines. Drivers who drive without insurance can face jail time after two or more convictions.New Jersey has also strict laws regarding car insurance scam. False information can lead to jail time and a $15,000 fine per fraud accusation.Additional Auto Insurance Options in New JerseyNew Jersey drivers often choose to buy car insurance that goes beyond what the state requires. While your monthly premium will go up if you add endorsement coverage, you still get greater protection. These are the most sought-after add-ons in New Jersey.
    • Collision Insurance: collision insurance will cover your vehicle for any damage that results from an accident. New Jersey’s average cost for collision insurance is $403/year.
    • Comprehensive Insurance: Comprehensive coverage covers vehicle damage caused by non-collision events like flood, fire, theft, and vandalism. New Jersey’s average comprehensive insurance policy costs $129/year.
    • Accident forgiveness: Unintentional injury forgiveness will prevent your insurance rates from rising after an at-fault incident. This coverage is usually limited to the first accident.
    • Rental car coverage: When your vehicle is being repaired due to a covered claim the rental car reimbursement coverage will cover the rental cost. This coverage is often included in full coverage policies by some insurance companies.
    Most Frequently Asked QuestionsWhich New Jersey car insurance company is best?Every driver will have their own opinion about the best New Jersey car insurance company. Different drivers are looking for great customer service, discounts or the lowest rates. Compare providers and shop around to find the best auto insurance company for you.Which is the best New Jersey car insurance?New Jersey has the following lowest-priced car insurance companies: NJM, Amica Selective Insurance Plymouth Rock, Geico, Selective Insurance, Selective Insurance, Selective Insurance and Selective Insurance. Selective Insurance’s most affordable policy with full coverage costs $1,019 per annum. NJM’s minimum coverage policy is the most affordable at $363. To find out which company can offer the best rate, you can request a customized quote.What is the cost of car insurance in New Jersey?New Jersey’s average cost for car insurance is $1,706 for full coverage and $727 for minimum coverage. Each driver pays a different rate depending on their zip code, driving record, credit score and claims history.
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