Car Insurance Requirements in New Jersey (2024)
New Jersey drivers must carry minimum amounts of bodily injury liability, property damage liability, uninsured/underinsured motorist, and personal injury protection.
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Written byAmy Beardsley
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3+ years writing about auto, home, and life insurance
7+ years in personal finance and technology
Amy specializes in insurance and technology writing and has a talent for transforming complex topics into easy-to-understand stories.
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Edited byKatie Powers
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Licensed auto and home insurance agent
3+ years experience in insurance and personal finance editing
Katie uses her knowledge and expertise as a licensed property and casualty agent in Massachusetts to help readers understand the complexities of insurance shopping.
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Updated November 20, 2024
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Table of contents
Car insurance requirements vary depending on where you drive. It’s important to understand what New Jersey law requires so you can have enough protection on the road and avoid penalties for driving while uninsured. New Jersey drivers can choose between basic and standard coverage limits. Your choice affects your right to sue after a car accident.
Here’s what you need to know about New Jersey’s “choice no-fault” system and coverage requirements.
Quick Facts
Only 3% of drivers in New Jersey are uninsured.
Drivers who select New Jersey’s minimum car insurance coverage have a limited right to sue the other driver after an accident.
A basic policy in New Jersey must include property damage liability and personal injury protection (PIP) coverage.
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New Jersey car insurance requirements
Though New Jersey drivers can select the state’s basic minimum-coverage policy, it has limited protections and doesn’t include bodily injury liability coverage. Most drivers in the Garden State opt to purchase a standard policy, which includes bodily injury liability, additional protections, and higher policy limits.
Below, you can compare the basic and standard coverage options in New Jersey. Drivers in the state must at least purchase the minimum coverage included in the basic policy.[1]
Coverage Type ▲▼ | Basic (Minimum) ▲▼ | Standard (Optional) ▲▼ |
|---|---|---|
| Property damage liability | $5,000 per accident | $25,000 per accident (up to $100,000 or more) |
| Personal injury protection | $15,000 per person, per accident (up to $250,000 for specific injuries) | $15,000 per person, per accident to $250,000 or more (limited to $250,000 for specific injuries) |
| Bodily injury liability | Optional $10,000 per accident | $25,000 per person and $50,000 per accident (up to $250,000 per person and $500,000 per accident) |
| Uninsured/underinsured motorist coverage | None | Up to liability coverage limits |
| Right to sue | Limited | Choice of limited or unlimited |
Property damage liability
Property damage liability protects you financially if you cause an accident that wrecks someone else’s property. Coverage can include harm done to another person’s vehicle and structures like fences, mailboxes, or lampposts.
New Jersey law requires you to have property damage liability protection. Your policy includes up to $5,000 per accident when you purchase basic coverage. If you opt for a standard policy, your policy limit can range from $25,000 per accident to $100,000 or more.
Personal injury protection (PIP)
To address medical costs, New Jersey requires all drivers to carry personal injury protection (PIP) coverage. It kicks in if you or anyone your policy covers faces injuries due to an auto accident. It pays for medical expenses even if you caused the crash, including the cost of treatment and reimbursement for lost wages.
You must have at least $15,000 per person or per accident in PIP coverage, whether you choose basic or standard coverage. The limit extends to $250,000 for certain injuries, including brain trauma, spinal cord damage, and other severe injuries. However, drivers with a standard policy can increase limits to $250,000 or more.
Bodily injury liability
Though PIP covers your medical bills, it doesn’t cover injuries you cause to others in a car accident. That’s why bodily injury liability is so important — it protects you against claims and lawsuits if you injure someone.
New Jersey’s basic policy doesn’t automatically include bodily injury liability, but you have the option to add $10,000 in coverage to the policy. If you select the standard policy, bodily injury liability starts at $25,000 per person and $50,000 per accident but can increase to as much as 10 times that if you want more extensive coverage.
Uninsured/underinsured motorist (UM/UIM)
New Jersey has the lowest rate of uninsured drivers in the country, at 3%, according to 2023 data from the National Association of Insurance Commissioners (NAIC).[2] However, that statistic doesn’t include underinsured drivers. If another driver causes a car accident, their coverage might not sufficiently cover your damages. UM/UIM coverage can bridge the gap.
A basic policy doesn’t include UM/UIM coverage. If you choose a standard auto policy, you can buy UM/UIM coverage to match the limits you choose for your liability protection.
New Jersey Special Automobile Insurance Policy
New Jersey SAIP
If you’re in a particularly tight financial position, consider the Special Automobile Insurance Policy (SAIP). It’s available only to drivers who qualify for Federal Medicaid with hospitalization. Eligible drivers can earn an incredibly affordable rate of $365 per year ($1 per day). You can pay in two separate installments or earn $5 off the price by paying it all up front.[3]
Do you need more than state minimum coverage in New Jersey?
Liability-only insurance pays for the expenses of the other driver and their passengers after an accident, but it doesn’t cover your repair costs. Full coverage, which includes collision and comprehensive insurance, costs more but extends your protection to cover your vehicle in a range of scenarios.
On average, New Jersey drivers pay $124 per month for liability coverage and $215 for full-coverage insurance. The amount of coverage you choose also determines what claims the insurance company will cover and whether you have a limited right to sue after a crash.
Good to Know
Insurance professionals often suggest upgrading from New Jersey’s minimum insurance requirements because they might not offer the protection you need. A minimum auto policy might provide enough coverage if you drive an older or inexpensive car. But you should consider full-coverage insurance if you have a new vehicle or a vehicle with a car loan or lease.
The cost of liability-only car insurance in New Jersey
Liability is coverage that can pay for the other driver’s property damage and injuries if you cause an accident. Without this coverage, you’d face expensive out-of-pocket costs. How much you pay for minimum liability car insurance in New Jersey varies widely among insurers. NJM has the cheapest average liability coverage, at $86 per month.
Compare the cheapest liability-only quotes for New Jersey drivers below.
The below rates are estimated rates current as of: Friday, November 1 at 12:00 PM PDT.
Insurance Company ▲▼ | Average Monthly Quote ▲▼ |
|---|---|
| NJM | $86 |
| CSAA | $88 |
| Plymouth Rock | $92 |
| GEICO | $110 |
| Bristol West | $133 |
| Foremost | $139 |
| Mercury | $143 |
| State Farm | $202 |
| Progressive | $209 |
| Travelers | $261 |
| Allstate | $332 |
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers and quote estimates from Quadrant Information Services. Actual quotes may vary based on the policy buyer's unique driver profile.
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The cost of full-coverage car insurance in New Jersey
Full-coverage insurance can protect your vehicle against accidents, thefts, and natural disasters. When looking at full-coverage options, you should remember that plans can vary and that your coverage should meet your financial situation and coverage needs.
Your full-coverage insurance premiums depend on the company and policy limits you choose. NJM offers the most affordable average rate for full coverage, at $135 per month.
Below, you can find average rates for full-coverage insurance from top insurers in New Jersey.
The below rates are estimated rates current as of: Friday, November 1 at 12:00 PM PDT.
Insurance Company ▲▼ | Average Monthly Quote ▲▼ |
|---|---|
| NJM | $135 |
| Plymouth Rock | $142 |
| CSAA | $144 |
| GEICO | $171 |
| Mercury | $195 |
| Foremost | $250 |
| State Farm | $315 |
| Progressive | $350 |
| Travelers | $407 |
| Allstate | $517 |
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers and quote estimates from Quadrant Information Services. Actual quotes may vary based on the policy buyer's unique driver profile.
Penalties for driving without proof of insurance in New Jersey
Driving a car without insurance is a serious offense in New Jersey that can lead to fines, community service requirements, license suspension, jail time, and surcharges.[4]
Fines: For the first offense, drivers face a fine of up to $1,000. The fine increases to $5,000 if caught a second time.
Community service: The court determines community service requirements for a first offense, but a second offense comes with a mandatory 30-day community service period.
License suspension: Drivers risk having their license suspended for one year if they don’t bring proof of insurance to the hearing. A second offense can result in a loss of driving privileges for two years.
Jail time: A first offense doesn’t generally require jail time. But failing to have an auto insurance policy a second time can result in spending 14 days in jail.[5]
Insurance surcharges: Besides the immediate fines and potential incarceration, uninsured drivers also face insurance surcharges of up to $250 per year.[6]
Optional car insurance coverages to consider
You can choose to have auto coverage beyond the New Jersey minimum requirements. Here are common optional coverages to consider:
Collision coverage
Collision coverage pays for damages to your vehicle following a collision with another vehicle or object, regardless of fault.
Comprehensive coverage
Comprehensive coverage safeguards your vehicle against damage from theft, vandalism, natural disasters, and more.
Rental reimbursement coverage
Rental reimbursement covers the cost of renting a car if yours needs repairs after an accident.
Roadside assistance coverage
Roadside assistance provides roadside service in the event of a flat tire, dead battery, jump-start, breakdown, and other car troubles.
New Jersey car insurance requirements FAQs
Car insurance in New Jersey differs from other states in a few different ways. Whether you’re a seasoned or new driver, the following information should help answer any of your remaining questions about car insurance requirements in New Jersey.
Does the state of New Jersey require car insurance?
Yes. New Jersey drivers must have a policy to cover potential costs resulting from accidents or other incidents on the road. Coverage options and policy limits can vary, but every registered vehicle in the state must have an active policy that meets the state’s minimum requirements for property damage liability and personal injury protection.
What are the minimum requirements for car insurance in New Jersey?
New Jersey drivers must at least carry a basic policy that includes $5,000 per person in property damage liability and $15,000 per person and per accident in personal injury protection (PIP). Drivers can opt for a standard policy with more coverage, including bodily injury liability and uninsured/underinsured motorist coverage.
How does car insurance in NJ work?
You can select either a basic or standard car insurance policy in New Jersey. Standard coverage offers more protection and is the most common option in New Jersey. The state follows a “choice no-fault” system, but your rights after an accident vary by policy. Basic coverage restricts suing rights, while the standard policy offers limited or unlimited suing options.
Do you need car insurance to register a car in New Jersey?
Yes. You must secure car insurance coverage before registering a car in New Jersey. The Motor Vehicle Commission (MVC) won’t process vehicle registration without it. Before heading to the MVC, make sure you have the insurance details in order. Bring your auto insurance card or company name and policy number.
Does insurance follow the car or the driver in New Jersey?
In the state of New Jersey, car insurance follows the car rather than the driver. It protects you if someone borrows and drives your car. If they cause an accident, your insurance policy is typically the primary source of coverage. Keep in mind that policy terms and situations can vary, so check with your insurance contract to verify the scope of coverage.
Methodology
Insurify data scientists analyzed more than 90 million quotes served to car insurance applicants in Insurify’s proprietary database to calculate the premium averages displayed on this page. These premiums are real quotes that come directly from Insurify’s 50+ partner insurance companies in all 50 states and Washington, D.C. Quote averages represent the median price for a quote across the given coverage level, driver subset, and geographic area.
Unless otherwise specified, quoted rates reflect the average cost for drivers between 20 and 70 years old with a clean driving record and average or better credit (a credit score of 600 or higher).
Liability-only premium averages correspond to policies with the following coverage limits:
- Bodily injury limits between state-minimum rates and $50,000 per person, $100,000 per accident
- Property damage limits between $10,000 and $50,000
- No additional coverage
- Comprehensive coverage with a $1,000 deductible
- Collision coverage with a $1,000 deductible
Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates.
Related articles
More cities in New Jersey
Sources
- New Jersey Department of Banking and Insurance. "New Jersey Auto Insurance Buyer's Guide."
- National Insurance Commissioners. "Uninsured Motorists."
- New Jersey Department of Banking and Insurance. "Special Automobile Insurance Policy (SAIP)."
- New Jersey Motor Vehicle Commission. "Insurance Requirements."
- State of New Jersey 218th Legislature. "Assembly, No. 271."
- State of New Jersey. "Surcharge Violation System."
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Amy BeardsleyInsurance Writer
Amy is a personal finance and technology writer. With a background in the legal field and a bachelor's degree from Ferris State University, she has a talent for transforming complex topics into content that’s easy to understand. Connect with Amy on LinkedIn.
Licensed auto and home insurance agent
3+ years experience in insurance and personal finance editing
Katie uses her knowledge and expertise as a licensed property and casualty agent in Massachusetts to help readers understand the complexities of insurance shopping.
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