Car Insurance in New Jersey

New Jersey Car Insurance

When it comes to obtaining car insurance in New Jersey, you have options. New Jersey offers several avenues for you to fulfill the state's car insurance requirements. Read more to learn about rates, policy options, and how to get the best car insurance quotes in New Jersey.

Car Insurance Requirements in NJ

In order to comply with New Jersey's car insurance laws, you must choose a car insurance policy. Basic and standard policies are available; you should choose whichever policy best suits your insurance and financial needs.

Basic Policy

The Basic policy option is the more affordable insurance package; however, it offers limited coverage, including:

  • $5,000 of property damage liability (PDL) per accident. This covers damage you may have caused to someone's property in a car crash.
  • $15,000 of personal injury protection (PIP) per person, per accident. This coverage pays for injuries you suffer in a car crash.
  • Up to $250,000 for very severe injuries, such as permanent brain injuries.

NOTE: Bodily injury liability (BDL) coverage is not included in the Basic policy; however, policyholders are offered the option to purchase $10,000 of BDL coverage.

Standard Policy

The Standard policy option has a higher premium but offers more extensive coverage.

With the Standard policy, you get a minimum of:

  • $25,000 of bodily injury liability (BDL) insurance per person, per accident. This coverage will pay for injuries to anyone not in your car if you cause a car crash.
  • $50,000 of BDL for multiple injured people per accident.
  • $5,000 of PDL per accident.
  • $15,000 of PIP per person in a car accident.
  • Up to $250,000 of PIP for severe or permanent injuries.

Right to Sue

If you choose to purchase the Standard policy, you will have to make a decision on your right to sue if you are injured in a car accident.

Regardless of which right to sue option you choose, you will not be eligible to sue for medical expenses or loss of income, as both of those will be covered by your PIP; you can only sue for pain and suffering.

Unlimited Right to Sue

If you choose the unlimited right to sue option, you can sue a person who caused an accident you were injured in.

Because this is option offers broader rights to sue, it comes with a higher premium.

Limited Right to Sue

If you choose the limited right to sue option, you agree to only sue a person who causes a car accident if you suffer any of the following injuries:

  • Loss of a body part.
  • Significant disfigurement.
  • Significant scarring.
  • Displaced fractures.
  • Loss of a fetus.
  • Permanent injury.
  • Death.

The limited right to sue option is the more affordable of the right to sue options, and is the only option available in the Basic policy plan.

PIP and Health Insurance

You have the option of making your health insurance the primary source of medical insurance after a car accident. If you are on Medicaid or Medicare, this option is not available to you.

If you choose to have your health insurance as your primary insurance over personal injury protection (PIP), your health insurance will pay for your medical care after an accident up to your policy's limits. Your PIP will help pay for further costs.

Choosing this option will lower your car insurance premium. However, before you make this decision, make sure your health insurance covers injuries due to car accidents.

You might also want to compare your health insurance deductible - the part of your insurance coverage you are responsible for - to your PIP deductible.If your health insurance deductible is higher, then consider making your PIP your primary source of insurance for accident-related medical expenses.

Optional Car Insurance

In addition to the Basic and Standard car insurance options, most New Jersey auto insurance carriers also offer the following optional types of coverage:

  • Comprehensive – This coverage protects you against damages done to your car that do not involve car accidents, such as vandalism or damage caused by bad weather.
  • Collision – This coverage will help pay for damages to your car that result from an accident with another moving car.
  • Towing and labor coverage.
  • Rental car coverage.

NOTE: Comprehensive and collision coverages are not required by New Jersey law; however, if you're paying a car loan or lease, your finance company will require you to purchase these types of coverage.

Special Automobile Insurance Policy

If you are enrolled in Federal Medicaid with hospitalization, you are eligible for New Jersey's Special Automobile Insurance Policy (SAIP), which helps people who might not be able to afford standard car insurance purchase a low-cost car insurance policy.

Through SAIP, you will only be covered for medical costs after a car accident.

An SAIP car insurance policy costs $365 per year if you choose to pay in 2 installments, or $360 per year if you pay for the entire year up front.

You can apply to SAIP through most New Jersey car insurance companies, but if you would like help, you can call the Personal Automobile Insurance Plan (PAIP) at (800) 652-2471.

Car Insurance Fraud in New Jersey

New Jersey takes insurance fraud very seriously. Possible car insurance fraud may involve:

  • Faking injuries after a car accident.
  • Medical professionals overcharging for treatment of injuries.
  • Staging car crashes.
  • Making or having false car insurance ID cards.

Fines and Penalties

Car insurance fraud convictions can lead to:

  • Jail time.
  • Up to $15,000 in fines.
  • Suspension of driver's license.

Reporting Car Insurance Fraud

If you know of any suspected car insurance fraud, you can report tips to the New Jersey Office of the Insurance Fraud Prosecutor (OIFP):

  • Online using the OIFP Fraud Reporting Form.
  • By phone through the OIFP hotline at (877) 553-7283.
  • By mail:
    NJ Department of Law and Public Safety
    Division of Criminal Justice
    Office of the Insurance Fraud Prosecutor
    P.O. Box 094
    Trenton, NJ 08625-0094
  • Via email at

Rewards Program

The OIFP offers a rewards program for individuals who report fraud, but only if the tip leads to an arrest and criminal conviction. Also, in order for the reward to be payable, the tip must be new, meaning the case cannot already be under investigation.

If submitting a reward application, you must do so within 30 days of your original notification of fraud to the OIFP in order to be eligible to receive the reward.

Car insurance fraud affects everybody with car insurance. You can help keep car insurance premiums down by reporting any possible instance of car insurance fraud.

Most Stolen Cars in New Jersey

You may face higher car insurance rates if you own a car that is highly targeted for theft.

The following are the most stolen cars in New Jersey for 2013, according to

  1. Honda Accord.
  2. Honda Civic.
  3. Dodge Caravan.
  4. Jeep Cherokee/Grand Cherokee.
  5. Ford Pickup (Full Size).
  6. Toyota Camry.
  7. Nissan Altima.
  8. Ford Econoline E250.
  9. Nissan Maxima.
  10. Toyota Corolla.
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