Car insurance in New Jersey

What New Jersey law requires you to carry

Every registered car in New Jersey needs liability insurance, and the state sets the floor. For a Standard policy issued or renewed on or after January 1, 2026, the minimums are:

• $35,000 per person for bodily injury
• $70,000 per crash for bodily injury
• $25,000 per crash for property damage

These come from P.L.2022, c.87, which raised the limits in two steps. The first step (25/50/25) applied to policies issued or renewed from January 1, 2023; the second step takes per-person cover to $35,000 and per-crash cover to $70,000, while property damage stays at $25,000 (DOBI Bulletin 25-06).

On top of liability, a Standard policy must include:

• Personal Injury Protection (PIP) of at least $15,000 per person, per accident — insurers must offer it and it comes with every Standard policy.
• Uninsured motorist (UM) and underinsured motorist (UIM) cover — both are required, and their minimums rose alongside the liability minimums under the same law.

Two practical points. First, if your existing policy was written at the old limits, the law tells your insurer to raise them at renewal and to notify you — and the insurer does not need a newly signed coverage selection form to do it. So a renewal quote that looks higher than last year may be buying you more protection than last year's did. Second, the increases do not apply to the low-cost Basic policy, which keeps its own lower limits; the figures above are for the Standard policy (Bulletin 25-06).

Minimum limits are a legal floor, not a sensible target. A serious injury claim or a crash involving two or three people can run past $70,000 quickly, and anything above your limit is a bill with your name on it.

Fault, no-fault and the choice New Jersey makes you make

New Jersey is a choice no-fault state. That means two things happen after a crash, and they are easy to mix up.

Your own injuries go through your own PIP first. Whoever caused the crash, your PIP cover pays medical treatment for you and the people covered by your policy, up to the limit you bought. PIP of at least $15,000 per person comes with every Standard policy (DOBI consumer pages). Because the first bills land on your own policy, you should report an injury crash to your insurer promptly even when the other driver was clearly to blame.

Damage to property is still fault-based. The at-fault driver's property damage liability cover pays to repair the other car and anything else that was hit. If the other driver caused it, you can claim against their insurer, or claim on your own collision cover and let your insurer chase them.

Then there is the lawsuit choice. When you buy a Standard policy you pick between a limited right to sue and an unlimited right to sue. The limited option is cheaper, but it restricts when you can sue the other driver for pain and suffering — generally you need an injury of a type the law treats as serious. The unlimited option costs more and keeps the right open. This choice is recorded on the coverage selection form you sign, it binds the family members on the policy, and people usually only find out which one they picked after they have been hurt. Read the form before you sign it, and ask your insurer or agent to show you the current wording.

A separate note on who pays what: your PIP paying your medical bills does not decide fault. Fault still matters for your property damage claim, for any claim against the at-fault driver that your right-to-sue choice allows, and for surcharges and future pricing.

Making a claim without losing money you were owed

A few habits make New Jersey claims go better.

At the scene. Call the police for anything beyond a scrape and get the report number. Photograph both vehicles, the positions, plates, the road and any damage to property. Swap names, insurer names and policy numbers. Note passengers and witnesses — passengers matter in a PIP state because they may have their own claims.

Report early. Tell your own insurer even if you think the other driver's company will pay. Your policy has notice and cooperation conditions, and late notice is one of the most common reasons a legitimate claim gets argued over.

Medical treatment under PIP. PIP in New Jersey runs through your insurer's medical protocols, so your treating provider will usually need to clear ongoing or planned treatment with the insurer before carrying on. Give your doctor your auto policy details, not just your health card — in a PIP state the auto policy is often the first payer. Keep every bill, referral and mileage record.

Repairs. You choose your repair shop. The insurer can recommend one and may stand behind the work at a shop in its network, but it cannot force you to use it. If you and the insurer disagree on the amount of damage, your policy almost certainly contains an appraisal clause — read it, because it is a cheaper route than a dispute.

Keep a paper trail. Dates, names, claim numbers and what was said. If the claim stalls, that file is what turns a vague complaint to the regulator into a specific one.

Disputes. PIP and other coverage disputes in New Jersey are commonly resolved by arbitration rather than by a court case; the exact route is set out in your policy, so check it or ask the Department before you assume you have no options.

Optional cover that actually earns its place

• Higher liability limits. The cheapest meaningful upgrade most drivers can make. Going above 35/70/25 usually costs far less per extra dollar of cover than the first dollars did, and it is what stands between a bad crash and your savings.
• Higher UM/UIM limits. Required at minimum, worth buying up. Uninsured and under-insured drivers are the reason this cover exists, and UIM only helps once it exceeds the other driver's liability limit — which is why matching your UM/UIM to your own liability limits is the usual advice.
• More PIP than the $15,000 floor. The Standard policy lets you choose your PIP level. Serious injuries exhaust a low limit fast, and after that you are relying on health cover and on whatever your right-to-sue choice lets you recover. If you carry a high-deductible health plan, think hard before cutting PIP.
• Collision and comprehensive. Not legally required, but required by any lender or lessor. Comprehensive covers theft, glass, flood, fire, storm damage and animal strikes — relevant in a state with coastal flooding and heavy deer activity.
• Rental reimbursement and towing. Small add-ons that remove the worst friction week of a claim.
• An umbrella policy. If you own a home or have real assets, an umbrella sits above your auto liability and is typically the cheapest large block of liability cover available to a household.
• Gap cover on a financed or leased car, where the loan can outlast the car's value.

On price: the NAIC put the average New Jersey expenditure for liability, collision and comprehensive combined at $1,693 per insured vehicle in 2023. That is an average across all drivers and all coverage choices, not a quote — your own number depends on where you garage the car, your record, your vehicle and the limits you pick.

Rules New Jersey drivers trip on

• Assuming the old limits are still fine. Policies written before the increases get raised at renewal. If you have a long-standing policy and you never read the renewal notice, check that your declarations page now shows at least 35/70/25 for a Standard policy (Bulletin 25-06).
• Buying the Basic policy without understanding it. The Basic policy is cheap for a reason: its limits are lower and the 2026 increases do not apply to it. For a driver with assets, income or a mortgage, the gap between Basic and Standard is where the risk lives.
• Signing the coverage selection form blind. Limited versus unlimited right to sue, your PIP level, and whether PIP is primary to your health plan are all decided on that form, and they are decided for everyone in the household on the policy.
• Forgetting that credit can affect your price. New Jersey insurers may use credit-based insurance scores in pricing. Errors on a credit file can follow you into a renewal quote, so it is worth checking yours.
• Letting cover lapse. Driving uninsured in New Jersey carries serious penalties, and a lapse also makes your next policy more expensive. If you sell a car, don't cancel the policy until the plates and registration are properly dealt with.
• Treating the insurance ID card as optional. Carry current proof of insurance in the car and produce it at a stop or a crash.
• Not shopping at renewal. Rates for the new minimum limits had to be filed and approved with the Department, and insurers do not all land in the same place. Comparing the same limits across several insurers is the only honest comparison.
• Only insuring the car, not the drivers. Anyone in the household who regularly drives the car should be on the policy. Undisclosed household drivers are a classic claim-time argument.

How to complain to the New Jersey regulator

Car insurance in New Jersey is supervised by the New Jersey Department of Banking and Insurance (DOBI), nj.gov/dobi.

Start with the insurer: ask for the claim handler's supervisor, get the decision and the reason in writing, and cite the policy wording you think applies. If that fails, DOBI's Consumer Inquiry and Response Center (CIRC) handles both questions and formal complaints (DOBI consumer assistance).

Your options:

• Online — the Department's online insurance complaint form, linked from its consumer assistance page, is the route it recommends as most convenient.
• Phone — 609-292-7272, or the Consumer Hotline on 1-800-446-7467, 8:30am to 5:00pm Monday to Friday. The same line covers help from the Office of the Insurance Ombudsman.
• Mail — NJDOBI, PO Box 471, Trenton, NJ 08625-0471.
• Fax — 609-777-0508 or 609-292-2431.

Every inquiry or complaint is logged, given a tracking number, and acknowledged. Include your policy and claim numbers, the dates, who you spoke to, and copies (never originals) of the letters, estimates and bills. Keep it factual and chronological.

What the Department can do: make the insurer explain and justify its position, check it against New Jersey law and the policy, and act on conduct that breaches the rules. What it generally cannot do: decide a contested question of fact for you, such as who was at fault or what an injury is worth — those go to arbitration or to court. A complaint is still worth filing, because regulators act on patterns as well as on individual files.