New Jersey Auto Insurance

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Whether you’re taking a fun family vacation to Ocean City, finally embarking on a weekend trip without the kids to Atlantic City, heading up to Princeton to take a tour of the campus, or going about your daily life in the suburbs, the Garden State has much to offer to those with a valid auto insurance policy and gas in the tank. 

In New Jersey, all drivers must have some auto insurance coverage, the minimum limit depending on the type of policy the driver holds. Driving without insurance in the Garden State is illegal, and those who fail to comply with the law may face hefty penalties. Let’s take a look at how you can ensure your policy is always up to par according to the law, how you can get the best coverage for your needs, and how you may be able to save on your policy so you can have some spending money for the boardwalk.

New Jersey Auto Insurance Explained

Whether searching for the leading car insurance companies in New Jersey, a bare-bones policy that won’t break the bank, or looking to strengthen your understanding of your policy, researching is the best way to find answers to your questions. The best place to start your research is by narrowing down what you value most in an auto insurance policy: cost or coverage. 

Those who value cost over coverage will likely opt for a minimum coverage policy from an insurer that offers below-average rates. Those who value coverage over cost will likely want a full coverage policy from an insurer that offers plenty of additional coverage. Those who can’t choose between cost or coverage and must compromise somewhere in the middle will likely find a full coverage policy from an insurer that offers lower-than-average base rates and various discounts is the most suitable policy for their needs.

Whether you value cost, coverage, or both equally, it’s vital to ensure you always have a valid policy that meets mandatory insurance minimums in the state. Let’s take a look at the minimum coverage limits on each policy offered in the Garden State and how you can ensure you never have to face the penalties for driving without insurance in the Garden State.

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New Jersey Car Insurance Requirements

New Jersey car insurance laws require all drivers with cars registered in the state to have a minimum limit of insurance coverage. Laws in the Garden State are slightly different than those in other states in that there isn’t just one set of insurance minimums. Instead, drivers must select either a basic or a standard policy and, from there, must abide by the minimum coverage required on each policy. 

Auto insurance requirements in the Garden State mandate drivers with a basic policy to have at least $10,000 in bodily injury liability per accident, $5,000 in property damage liability per accident, and $15,000 in personal injury protection (PIP) per accident.

Drivers with a standard policy are expected to maintain at least $25,000 in bodily injury liability per person, $50,000 in bodily injury liability per accident, $25,000 in property damage liability (25/50/25 liability coverage), the same 25/50/25 limit of uninsured and underinsured motorist coverage (UM/UIM), and $15,000 in PIP. Those who lease or finance their vehicles may be required to have collision and comprehensive coverages on their policies. 

What Are the Penalties for Driving Without Insurance in New Jersey?

Those caught driving without insurance at any point in their driving history will likely require high-risk auto insurance in New Jersey and may face several other penalties for this crime. Those who fail to comply with the mandatory auto insurance minimums may face penalties such as hefty fines, license and registration suspension, community service, vehicle impoundment, or even jail time. 

While the legal penalties for failing to comply with auto insurance laws in the Garden State are enough to convince many drivers to maintain a policy with at least minimum coverage, the financial consequences must be considered, too.

On top of legal trouble, those caught without sufficient coverage in the event of an accident will likely see a hefty financial burden placed on their shoulders. Uninsured drivers considered at fault in an accident are often on the hook for most of the expenses incurred in the accident for all parties. 

As if that’s not enough, if an uninsured driver can’t pay for all the expenses they owe, the victim may sue. So, on top of the legal penalties for the crime and the financial consequences, one may also be on the hook for legal defense fees or damages should the victim win the case.

Should one cause an accident while uninsured, on top of all the obvious consequences, drivers may also face higher insurance premiums for years to come. While drivers aren’t required to have SR-22 insurance in the Garden State, drivers at high risk of filing claims may pay above-average premiums.

High-risk insurance in the Garden State, while not an actual type of policy or coverage, is far more expensive than the average cost of a full coverage policy for a driver with a clean driving record.

What’s the Minimum Auto Insurance in New Jersey?

Many drivers must carry minimum limits of PIP, liability coverage, and uninsured motorist coverage in New Jersey. However, those who select a basic policy aren’t required to carry UM/UIM. Only drivers with a standard policy must carry such coverage. 

While carrying the minimum amount of auto insurance required for one’s type of policy is perfectly legal, it may not always be the safest option. Drivers often opt for a full coverage policy to ensure they’re covered in a wide range of scenarios and often carry more coverage than they’ll ever use just in case they’re involved in a worst-case scenario.

In New Jersey, a full coverage policy will generally have higher limits of liability coverage, UM/UIM coverage, and PIP than the minimums on a standard policy mandate. A full coverage policy in the state will also include additional coverages like collision coverage, comprehensive coverage, medical payments coverage (MedPay), and gap coverage

Is New Jersey a No-Fault State?

In New Jersey, no-fault insurance coverage is required on all insurance policies because the state is a no-fault state. No-fault states have laws requiring drivers to default to their own insurance coverage if they’re injured in an accident, regardless of who caused it. Many no-fault states, including the Garden State, require drivers to carry a medical benefit like personal injury protection or PIP.

New Jersey is one of thirteen states with a no-fault law. Most other states are tort states, meaning at least one driver must be considered at fault in each accident. Fault must be assigned to a driver in a tort state so the victim may invoke the driver’s liability coverage to cover their medical expenses. 

While New Jersey is a no-fault state, drivers must carry some liability coverage. In the event of an accident, policyholders will default to their mandatory $15,000 in PIP to cover their medical expenses. Should PIP not cover all their costs, the fault would have to be assigned so the victim could invoke the at-fault party’s liability coverage for the remainder of their expenses.

Should the victim max out their PIP and the at-fault driver’s liability coverage, they may receive coverage from their underinsured motorist coverage (UIM), should they have a standard or full coverage policy.

Does New Jersey Have a Personal Injury Protection Law?

Yes, in New Jersey, PIP coverage is required on all auto insurance policies, with a minimum limit of at least $15,000 per accident. Drivers are required by law to carry PIP as a caveat of the no-fault law. Drivers carry PIP so they can have coverage for their medical expenses should they be involved in an accident, regardless of who’s at fault in an accident.

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How To Get Cheap Car Insurance in New Jersey

While cheap auto insurance in New Jersey may be tough to come by, it isn’t impossible. Objectively, the cheapest policy will always be a minimum coverage one. However, a minimum coverage policy may not always offer enough protection for you to feel comfortable behind the wheel. Even still, there are a few ways you can find an affordable policy without breaking the bank.

The cheapest policy in the Garden State that doesn’t skimp on coverage will be a full coverage policy from an insurer that offers below-average base rates and several stackable discounts. Auto insurance discounts typically fall into two categories: criteria or enrollment-based.

Enrollment-based discounts generally require policyholders to get involved in their savings. For example, many insurers offer a usage-based discount program in which drivers can enroll to track and send their driving data via a telematics device to their insurer to receive a discount based on a safe-driving score. Drivers should proceed with caution when it comes to such programs, as some insurers may use a driver’s driving habits as a reason to raise their premiums. 

Criteria-based discounts simply require drivers to meet a set of standards. For example, many insurers offer a student discount, a bundling discount, or a multi-car discount that drivers can combine if they meet their insurer’s criteria for the discount.

How Much Is New Jersey Car Insurance?

Car insurance rates in New Jersey fall at about $1,900 annually for a full coverage policy. The average policy in the Garden State costs about 15% more than the national average of about $1,670 annually. It’s also essential to remember that premiums are highly subjective based on each driver so that policyholders may see rates far above or below the average rate in the state.

Insurers use several factors to determine one’s premiums, all related to a driver’s likelihood of filing a claim. If a driver is at high risk of filing a claim, insurers compensate for that risk by charging them above-average premiums. To assess one’s risk, insurers generally use one’s driving record, insurance history, age, ZIP code, and gender, among other characteristics

Average Car Insurance Cost in New Jersey Explained

The average car insurance in New Jersey is a full coverage policy that costs about $1,900 annually. While some insurers may offer base rates below the state average, it’s important to remember that premiums are highly subjective, and rates may not be available to every driver. Generally, middle-aged drivers with a clean or mostly clean driving record and an excellent insurance history will have the lowest premiums. 

While premiums vary from person to person, some environmental factors also contribute to premium costs. For example, states with dense populations or densely populated cities generally have average premiums above the national average, as is the case for the Garden State.

What’s the Cheapest Auto Insurance in New Jersey?

The cheapest New Jersey car insurance is a minimum coverage policy that meets the minimum coverage requirements but doesn’t exceed them. While a minimum coverage policy is legal if it meets the state’s legal coverage requirements, it may not offer the best protection in an accident.

While full coverage policies will typically be more expensive than minimum coverage policies, investing in one’s safety is often worth it. Plus, plenty of insurers in the Garden State offer base rates for a full coverage policy far below the state average.

What Are the Best Insurance Companies in New Jersey?

The best New Jersey auto insurance company is highly subjective and will vary depending on each driver’s needs. That said, Geico has some of the lowest base rates in the state, with the average full coverage premium coming in at about  $1,240 annually, or about 45% below the state average.

Binding a policy with one of the top insurers in the state, like Geico, Travelers, or State Farm, is an excellent way to get a full coverage policy at a below-average rate. Plus, many of the state’s top insurers offer a wide range of discounts policyholders can stack to reduce their premiums further. For those that value coverage over cost, these insurers also offer plenty of optional coverages drivers may add to their policies to have a more expansive range of coverage.

How To Find the Best Car Insurance in New Jersey

Whether you want a full coverage policy or a policy with the minimum limits of PIP, property damage liability, and bodily injury liability in New Jersey, many will go to some lengths to get the policy with the most bang for their buck. Remember, there isn’t a one-size-fits-all policy that will be the best choice for all drivers. Car insurance is highly subjective, and what may be best for your friend or neighbor may not be the best policy for you.

The most efficient way to find the best auto insurance for your needs is to narrow down what you value in a policy: cost, coverage, or both equally. From there, you can research insurers that offer excellent optional coverage options or plenty of stackable discounts, depending on what you want more of on your policy. Then, once you have a few options in mind, it’s time to gather quotes. 

How To Get Car Insurance Quotes in New Jersey

Whether you value coverage, cost, or both equally, the best way to compare auto insurance in New Jersey to decide on the best policy for your needs is to get and compare quotes online. Getting and comparing quotes online is a quick and efficient way to see what types of policies are available to you and allows drivers to make the most informed choice when it comes to their policies. 

Lucky for you, you’ve come to the right place for quotes. Here at Clovered, we have a free quoting tool you can use to access your unique quotes in minutes so you can save time and energy for those tough carnival games down the boardwalk in Ocean City. If you have any questions about your quotes or want to chat with an agent, you can contact us at 833-255-4117 or agent@clovered.com.

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The editorial content on Clovered’s website is meant to be informational material and should not be considered legal advice.

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