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|New Jersey Statistics Summary||Stats|
|Road Miles||Roadway Miles: 39,065|
Vehicle Miles Driven: 75.4 billion
|Number of Vehicles Registered||5,786,113|
|Most popular vehicle||Honda CR-V|
|Uninsured %||14.9% (ranked 14th in the nation)|
|Total Driving Related Deaths||Speeding: 120|
|Average Annual Premiums|
(not including PIP)
In the game of life, it’s nice to have options. When it comes to car insurance, New Jersey is one of the few no-fault states that provides options – 12,376 combinations to be exact. There are essentially 11 components to choosing New Jersey coverage, and each component has up to 17 options.
We understand trying to get a quote for New Jersey car insurance could, simultaneously, make your eyes cross and your head spin. And, on top of that, year after year, New Jersey vies for the number one spot against Michigan and Louisiana for having the highest rates in the country.
We are here to help you weigh your options and make the best decision for you and your family. We cover the reasons why New Jersey car insurance is so high, your options (and consequences) in decreasing your rate, and other interesting data and facts unique to New Jersey drivers.
Comparing rates may be a challenge, but it’s a great way to customize the ways you can save! Start today with just your zip code.
New Jersey Car Insurance Coverage and Rates
Before we get into all of the colorful options, it’s important to understand a bit of New Jersey’s history as a no-fault state and how it stacks up against other no-fault states.
Despite the plethora of options, car insurance rates in New Jersey are still one of the highest in the nation.
Later on, we will explain why the rates are so high and describe the options you have as a driver in New Jersey. For now, let’s get started with the basics.
– Car Culture of New Jersey
As car insurance rates rose over the years, more and more New Jersey residents investigated other means to get to work, especially with 14.8 percent in 2010 commuting to work for longer than an hour. This is due to over 500,000 New Jersey residents working in New York or Pennsylvania.
By 2010, 11.2 percent of New Jersey residents rode transit to work, and the state saw a 4.6 percent increase in the total workforce from 2000 to 2010, but the number of workers using the transit system increased by 20.9 percent.
It’s not surprising that New Jersey falls in second place to New York in the percent of commuters who take advantage of the transit system.
The video may detour you from taking the transit, but you might as well go ahead and make your options total to 12,377 by including transit. After reading our guide, we suggest you don’t rule it out completely.
– Minimum Car Insurance Requirements in New Jersey
|New Jersey Minimum Insurance Required (Basic Policy)||Minimum Limits|
|Bodily Injury Coverage||None required, but optional starting at a minimum of $10,000 per person and $10,000 per accident|
|Property Damage Coverage||$5,000|
|Personal Injury Protection (PIP)||$15,000 per person, per accident |
Up to $250,000 for brain and spinal cord injuries
New Jersey is a “choice no-fault” state, which means drivers file claims to their own insurance companies rather than filing a liability claim or lawsuit against another driver as in at-fault states.
Traditionally, no-fault law is designed to keep lawsuits out of the court system and provide the medical coverage needed after a catastrophic accident.
Unlike other no-fault states, New Jersey gives drivers an opportunity to preselect their level of right to sue (also known as limited tort and full tort) in the case that they are seriously injured in an accident.
Even though it doesn’t matter who is at fault, New Jersey requires that you carry, at the minimum, the following liability amounts just in case you are sued.
Liability insurance pays anyone owed compensation when you are in an accident.
- $15,000 – covers injuries or death per person or per accident for yourself or anyone under your policy.
- $250,000 – covers brain or spinal cord injuries for yourself or anyone under your policy.
- $5,000 – covers property damage.
The first two amounts above are actually part of New Jersey’s required personal injury protection coverage, so no matter what combination of coverage options you choose, at the minimum, these three amounts of personal injury protection and property damage liability are all required.
You may be wondering: Why need liability coverage if it doesn’t matter who is at fault?
In New Jersey, liability insurance is beneficial if you:
- regularly drive in another state that is at-fault
- are in an accident (in New Jersey) with someone from an at-fault state
- wish to retain full tort rights
If one or all of the above scenarios could apply to you, it may be good to consider increasing the minimum liability limits beyond what is required by law.
So, if it’s not liability coverage causing such high rates, then what is it?
Let’s explore the three major reasons why New Jersey rates are so high. Later on, we will examine the options you have to reduce your rates.
– High Rates Factor #1: Personal Injury Protection
Remember that “no-fault” doesn’t mean that no one is ever responsible for causing an accident. Officers will always collect evidence of fault at the scene, and it could be used in a personal injury case.
No-fault means that drivers must turn to their own insurance providers in the case that there are injuries, losses, and damages as a result of a car accident.
A significantly large part of your no-fault policy premium (regardless of the plan you choose) will be paid towards Personal Injury Protection (PIP) which has a maximum benefit of $250,000.
This part of your policy will cover:
- all reasonably necessary medical expenses (after a deductible and 20 percent of the first $5,000)
- $100 a week for 52 weeks, at a minimum, and additional options can be purchased
- housekeeping and yard services (up to $12 per day)
However, this basic no-fault policy will not pay for repairs to your vehicle. That is additional (optional) coverage that we will cover later.
In at-fault states, personal injury protection is not included, and insurance companies charge rates that reflect only the statistical likelihood of their insureds in hitting another vehicle because they assume other drivers have insurance to cover themselves when at-fault.
New Jersey residents must pay premiums to cover, at the minimum, between $15,000-$250,000 per person, per accident, for their own personal injury protection and that of everyone in their household. The exact amount, of course, depends on the type of injury and the total number of individuals listed on your policy.
PIP provides immediate care to those covered who are injured in a car accident. After a deductible ranging between $200-$2,500 and 20 percent of the first $5,000 in medical bills is met, personal injury protection covers injuries (or loss due to injuries) year after year.
The bottom line?
Your insurance company must charge rates to provide the potential of needing medical care and lost wages if you, or a family member, are seriously injured in an accident.
Again, New Jersey does offer options in deductibles and various levels of PIP coverage to lower your premiums. We will explain those options a bit later.
– High Rates Factor #2: Profits vs. Losses
All insurance companies in the state of New Jersey have what is called a loss ratio.
A loss ratio shows how much a company spends on the types of claims to how much money they take in on premiums. A loss ratio of 60 indicates the company spent $60 on claims out of every $100 earned in premiums.
So, the closer the ratio is to 100, the more claims that are paid; however, this also shows that insurance companies are losing money. Sixty to 70 loss ratio is considered to be in the safe zone.
|Personal Injury Protection||72.98||70.93||75.78|
|Medical Payments (Med Pay)||66.79||58.30||80.04|
You can see in the table above that, statewide, insurance companies in New Jersey are doing well in managing their loss ratios for PIP, Med Pay, and Uninsured/Underinsured motorists coverage. We will cover loss ratios for specific companies later.
Based on the steady ratios, it seems that both insurance companies and policyholders in New Jersey are making good choices given their options. Providing these choices is what keeps your rates and insurance companies’ profits from increasing too much and too quickly.
However, it could be worse.
Looking at loss ratios for other no-fault states puts New Jersey’s high rates into a different perspective. New Jersey is one of 11 no-fault states in the US that actually provides options.
Our hearts go out to the no-fault state of Michigan which has no unlimited PIP coverage. Florida is another no-fault state with high rates, but they at least offer a minimum option of $10,000 PIP. In the table below, New Jersey is compared to Florida and Michigan.
|State||Total Cost of Incurred Losses||Total Number of Incurred Claims|
|New Jersey||$1.2 billion||92,100|
In 2015, Michigan car insurance companies had only 12 percent of the total PIP claims that Florida did; yet, insurance companies were forced to pay out one billion more in losses than Florida insurance companies.
New Jersey comes in second for the number of claims and third for the amount spent on claims. Florida requires a minimum of $10,000 PIP coverage, and Michigan includes unlimited PIP coverage.
So, again, it could be worse.
– High Rates Factor #3: Increasing Cases of Auto Insurance Fraud
If 15 percent of New Jersey residents are driving around uninsured, that means that only 85 percent are willing to pay the high rates, despite the variety of options.
We figure that maybe having so many options causes a great deal of confusion and frustration, so these some 868,000 drivers are enjoying the bliss of ignorance.
But, what about the individuals who use their intelligence to commit insurance fraud?
It’s not just policyholders but also doctors, lawyers, and insurance agents that could be involved in fraud. Listen to the following case which involved the partnership of several people to take advantage of auto insurance claims.
The New Jersey Attorney General’s Office of the Insurance Prosecutor handles all reports and cases of auto insurance fraud.
And NJ does not take fraud lightly.
In fact, in 2013, the OAG launched a campaign to educate the public about insurance fraud and how to report it.
The OAG even offers a reward to those who report a new case that ends in a conviction. They attribute a 31 percent increase in electronic submissions in 2013 to their aggressive four-month advertising campaign of over 95 million impressions in the form of outdoor ads on billboards and busses as well as on radio, online, cable TV, and even in print form.
OAG published a report in 2013 showing that from 2008 to 2013, average annual prison sentences increase from just under one year to almost 4.5 years. The 2017 report includes descriptions of the most significant cases.
And they continue to crack down on fraud cases dealing with car accidents.
New Jersey is one of only five states that mandates an auto photo inspection. This means that photographic evidence must be collected at all accident scenes.
Auto accident fraud is a crime in New Jersey. Those convicted may be sentenced up to 18 months of jail time, $10,000 in fines, and 30 days of community service.
What’s the good news?
There are ways you can reduce your rates more quickly than reporting insurance fraud, but, at the end of the day, your insurance company is responsible for covering you no matter what.
It’s important to understand the good and bad consequences when considering all of your options.
– Cheapest Option: the Basic Policy
The “choice” part of New Jersey’s “choice no-fault” law comes into play when you consider your family dynamics and the value of your assets.
If you have very few assets, it’s difficult to be sued for damages and losses beyond the minimum requirements established by New Jersey law. This is why New Jersey established a basic policy option in 1998.
New Jersey’s basic policy promised 20 percent in savings in hopes to reduce the number of uninsured motorists.
However, by 2002, the New Jersey Department of Banking and Insurance (DOBI) released a memo urging insurance providers to encourage the basic policy because only 0.22 percent of residents had signed up for it.
DOBI attributed the low percent of basic plans to the lack of accurate information for drivers and providers.
The department currently clarifies on their website that the basic policy is best for those with few family responsibilities and few real assets (savings, homeownership, high salary, etc.) such as younger drivers who are just beginning work.
If you do have family members and substantial assets, choosing the basic policy will still decrease your rates significantly.
But, there’s a catch.
Any individual who elects the basic policy is provided with only a limited right to sue. This means that if you are in an accident, and the other party is determined at fault, you are permitted to retain economic-only reimbursement (medical costs, loss of wages, etc.). You will not be permitted to collect for pain and suffering.
There are six exceptions to this limited right to sue as part of the basic policy: death, dismemberment; loss of a fetus; objective, significant disfigurement or scarring; displaced fractures; or permanent injury.
Basic policyholders do have the option of purchasing additional coverages such as bodily injury liability, but it is limited to a total maximum of $10,000 for all persons involved in an accident.
Other coverages basic policyholders can purchase include comprehensive and collision; however, they are not permitted to purchase uninsured or underinsured motorists coverage.
– Multiple Options: The Standard Policy
The minimum coverage requirements by law can still be met with the standard policy.
In the case that you wish to carry the standard policy but still meet only the minimum requirements, there are five parts of the standard plan as shown in the table below.
|Type of Coverage||Required or Optional||Low to High Levels||What it covers|
|Bodily Injury Liability||Required||Minimum: $15,000 per person, $30,000 per accident|
Maximum: $250,000 per person, $500,000 per accident
|claims and lawsuits by people injured as a result of an auto accident you cause|
|Property Damage Liability||Required||Minimum: $5,000|
Maximum: $100,000 or more
|claims and lawsuits by people whose property is damaged as a result of an auto accident you cause|
|Personal Injury Protection||Required - automatically included in your rate||Benefit up to $15,000 per person, per accident|
Benefit up to $250,000 in the case of brain or spinal injuries
Increased Benefit can be purchased in any amount
|covers injuries sustained in an automobile accident for you or other persons covered under your policy|
|Uninsured/Underinsured Motorist Coverage||Required||Must be same as Bodily Injury and Property Damage Liability amounts||covers property damage or bodily injury if you are in an accident caused by an uninsured motorist or a driver who is insured, but who has less coverage than your underinsured motorist coverage|
(usually required if vehicle is leased or financed)
|Any amount||covers damages to your vehicle when colliding with another car or other object|
(usually required if vehicle is leased or financed)
|Any amount||covers damages to your vehicle that is not a result of a collision, such as theft of your car, vandalism, flooding, fire, hitting an animal, or a broken windshield|
If you wish to carry more than the minimum coverage requirements with the Standard Plan, you have MANY optional combinations to get the exact coverage fit for you or your family.
Customizing a standard policy breaks down into making four critical decisions:
- choose your lawsuit option – limited tort or full tort
- choose personal injury protection or health insurance as primary
- choose full PIP benefits or medical expenses only
- choose your PIP deductible
Each choice and the options within that choice is described further in the next few sections.
– Choose your Lawsuit Option
With the Standard Policy, drivers can choose limited or full tort rights. Since the purpose of having no-fault law is to keep lawsuits out of the court system, New Jersey gives drivers lower rates if they give up part of their right to sue.
- Choosing limited tort allows you to recover all medical and other out-of-pocket expenses (such as loss of wages while in recovery), but not for pain and suffering.
- Choosing full tort will ensure that you and other household members can recover all medical and other out-of-pocket expenses as well as financial compensation for pain and suffering.
As you can imagine, pain and suffering would take a great deal of the court’s time to negotiate and calculate whereas medical and out-of-pocket expenses are easily documented and calculated. By giving up your right to sue for pain and suffering, you will reduce the amount of court time needed if a suit is filed.
To note, if you choose the limited tort option, you cannot sue an insurance company. However, insurers can lose this limitation on liability for failing to act in accordance with the law.
While it is unknown how many New Jersey drivers select the limited tort option, if you choose full tort, know that the bodily injury liability and the uninsured and underinsured motorists portions of your premium could increase by as much as 67 percent.
It may sound like New Jersey expects citizens to “pay for” their right to sue, but New Jersey is ahead of the curve, actually, in solving the issues that no-fault law has created over several decades of changes in the health care industry, insurance industry, and legal system.
By offering so many combinations in options, New Jersey has balanced out the burden on drivers when some states are struggling to address the issues created by no-fault law.
Case in point, Michigan, as mentioned earlier, has been working to make changes for decades while watching a socio-economic crisis snowball over many of their citizens. Michigan rates increased by 22.8 percent from 2011 to 2015 as compared to the 11 percent increase nationwide for the same time period. Searching “Michigan Car Insurance” on youtube will supply plenty of evidence of their struggle.
New Jersey’s rates increased by only six percent from 2011-2015, well below the national percent increase rate.
Worth noting here, Colorado successfully reduced its premiums by 27 percent from 2002-2004 by making the cold-turkey switch from no-fault law to at-fault law. However, Colorado rates increased by nearly 17.5 percent from 2011-2015, so cold-turkey may not solve the problem.
We are not sure if at-fault law will be considered for New Jersey to reduce rates in the future, but at least drivers currently have options.
– Choose PIP or Health Insurance as Primary and a PIP Deductible
New Jersey gives the option for drivers to file medical claims from accidents to a primary provider meaning that when the primary provider benefits are exhausted, the secondary provider will cover expenses.
In the case that you choose your health insurance company as your primary benefit, you will still need to select a PIP deductible amount because PIP will provide secondary benefits.
To illustrate how rates are affected by the various options within these two choices, we pulled quotes for a 30-year-old New Jersey driver without comprehensive or collision and with limited tort. We used one of the major insurance providers in New Jersey. These premiums are for a six-month policy. Feel free to sort the table as you wish.
|Health Care Provider||Policy Limits||Deductible||PIP Cost||Total Policy Cost||Percent PIP Cost is of Total Policy Cost||Total Policy Cost if choosing medical expenses only|
|Health Insurance Primary||$15,000||$250||$82||$302||27%||$294|
|Health Insurance Primary||$15,000||$2,500||$68||$287||24%||$280|
|Health Insurance Primary||$75,000||$250||$123||$343||36%||$335|
|Health Insurance Primary||$75,000||$2,500||$100||$320||31%||$313|
New Jersey rates decrease by as much as 34 percent when choosing health insurance as primary and a higher PIP deductible.
If choosing the minimum requirements and selecting medical expenses only, you are selecting the basic policy, and premiums reduce by as much as $20 over six months.
If you choose higher than minimum coverage requirements, you still have the option to choose medical expenses only.
But, it’s important to understand what you are exchanging for a lower premium.
Choosing health insurance as primary means that you will have to meet your annual deductible and co-insurance each year following injuries sustained in a car accident. Choosing PIP as primary will ensure that you pay a deductible only once for as long as you are recovering, depending on the injury.
In the case that you select coverages above the minimum requirements, you also have the option to select medical expenses only which is what the basic policy provides.
Choosing medical expenses only shaves off between $7-$20 from your premium. Selecting this option means that you will give up:
- income continuation up to $5,200
- essential services up to $4,380
- death benefits up to $9,580 for income continuation and essential services
- funeral benefits up to $1,000
If you wish to take advantage of the above options for yourself and your family, you can increase them by electing to pay higher PIP rates. You may also choose if you want PIP to cover only you, all drivers, or all members of your household.
It seems like we are finally approaching that 12,376th option.
– Final Option: Drive Uninsured
In most states, it’s frowned upon to not carry car insurance; however, for the state of New Jersey, which ranks 14th in the country for the highest percentage of uninsured motorists (15 percent), it may be a necessity for some.
However, there are major consequences.
- If you cause an accident, you (and only you) are responsible for paying for the pain, suffering and other personal hardships and some economic damages, such as lost wages.
- If you are sued, the insurer has no responsibility to provide or pay for a lawyer to represent you.
- If a judgment is entered against you, your assets will be at risk including the risk of having money deducted from your wages.
- If you have no coverage at all, and someone else is at fault in a car accident, you are not permitted to sue.
These consequences are affectionately called “No Pay, No Play” laws in New Jersey as well as nine other states in the US. The play refers to playing in the court system.
Some states, such as Louisiana, don’t allow uninsured drivers to retain the first $10,000, but they are permitted to sue.
New Jersey eliminates all rights to sue if you do not maintain car insurance.
Further evidence that New Jersey doesn’t “play” around is that basic policyholders are not permitted to purchase uninsured or underinsured motorist coverage while standard policyholders are required to purchase it.
So, before you decide to join the 15 percent of residents driving without car insurance, consider saving your paycheck and preserving your right to sue.
If you simply cannot afford car insurance and you have Medicaid hospitalization benefits, go to the section about the “Special Automobile Insurance Policy.”
– Required Forms of Financial Responsibility in New Jersey
With your paycheck in hand and your rights in the other, be sure to put proof of insurance in your pocket.
Proof of insurance is accepted in two formats – paper and electronic. Drivers must keep proof of insurance in the vehicle or be able to produce an electronic version on a mobile device.
New Jersey requires that a proof of insurance paper card be a specific size and on card stock. The card or electronic version must be made available before inspection, after an accident, when pulled over, and while going through checkpoints.
– Penalties for Driving Without Insurance
New Jersey takes driving without insurance just as seriously as insurance fraud.
If you drive without insurance in New Jersey, you will be fined up to $300 and have your license suspended for one year.
The suspension may be reduced or eliminated if showing proof of insurance at the hearing.
And if you didn’t learn your lesson the first time, a second conviction will provide you with a nice 14-day stay in prison, and when you get out, two years of suspension of driving privileges, up to a $5,000 fine, and 30 days of community service.
– Premiums as Percentage of Income in New Jersey
How exactly (un)affordable is car insurance for New Jersey residents?
Let’s find out.
In 2014, the annual per capita disposable personal income in New Jersey was $49,983.
Disposable personal income (DPI) is the total amount of money available for an individual to spend (or save) after their taxes have been paid.
New Jersey has remained in the top five highest paying states for quite some time now, but it still lags behind DC by $10,000. Some would argue this is why insurance rates are so high, but that’s not the case.
In 2014, New Jersey residents paid only 2.74 percent of their annual DPI on car insurance, which is one half a percent higher than DC.
Even though New Jersey residents make great money and pay one of the top three highest rates for car insurance, they trail behind Michigan and Louisiana (also no-fault states) by over one percent when looking at car insurance rates as a percent of income.
Also to note, from 2012 to 2014, this percentage for New Jersey maintained around the same while Michigan’s percentage continued to swell.
There’s no doubt that the multitude of options New Jersey residents enjoy helps keep this percentage lower as compared to other no-fault states.
The average New Jersey resident has $4,165 each month for living expenses. Car insurance alone will cost about $114 per month.
Remember, these amounts include only liability, collision, and comprehensive coverages. These estimates do not include personal injury protection or uninsured and underinsured motorists coverages.
Use our rate-as-percent-of-income calculator below to get your own more accurate estimate.
Why is getting the best deal on car insurance so important?
American Consumer Credit Counseling suggests saving 20 percent of every paycheck. With New Jersey’s DPI, that’s about $833 each month! How much are you tucking away to savings each month?
– Core Coverage in New Jersey
The National Association of Insurance Commissioners, the experts on the matter, tracks average rates for each type of coverage. Their 2015 data, the most recent that is available, is displayed in the table below.
|Coverage Type||Annual Costs in 2015||Compared to National Average in 2015||2015 Rank in US|
The national average of all states for full coverage is $1,009.38. You can see New Jersey comes in over $370 higher than the national average.
Worth noting, the state of New Jersey comes in second place in the nation as having the highest full coverage rates.
New Jersey comes in first place for liability coverage, but residents get a break on comprehensive and collision coverage rates in comparison to other states.
Even though New Jersey has minimum requirements for liability and personal injury protection, experts recommend drivers purchase more in case you are sued or you get hurt in a serious accident.
You may be wondering: Why do I need more coverage than required by law?
The state’s minimum amounts don’t even come close to the bills to expect if you are in an accident.
– More Options: Increasing your Limits
When you obtain a quote, you will see (or hear) all of your options in levels of coverage. Later on, we will explain how coverage levels affect your premium amount. But for now, let’s take a look at coverage levels.
The lowest option (the minimum) and the highest option is listed in the table below. Remember, each component has up to 17 options, so you can imagine the coverage amounts between the lowest and highest.
|Coverage Type||Lowest Amount (minimum required by law)||Highest Amount|
|Bodily Injury Liability||15/30||500/500|
|Property Damage Liability||$5,000||$500,000|
|Uninsured and Underinsured Bodily Injury Liability||15/30||500/500|
|Uninsured and Underinsured Property Damage Liability||$5,000||$500,000|
|Additional PIP||Lost Wage: $100 per week / $10,400 max|
Essential Services: $12 per day / $8,670 max
|Lost Wage: $700 per week / unlimited|
Essential Services: $20 per day / $14,600 max
|PIP Medical Expense Limit||$15,000||$250,000|
|PIP Expense Deductible (higher deductible = lower rate)||$2,500||$250|
Some things to note is that, under no-fault law, you are essentially having to pay your insurance company in advance to cover any damage to your vehicle and property, medical expenses if injured, and lost wages while recovering. This is the case for any accident that you and/or someone else causes.
The purpose of (and opportunity to) increase your limits is to protect your assets and get the medical care you need after serious injuries. It is also available to you when you cause an accident. Some amounts you can reasonably predict; others you can’t.
For example, if you make the assumption that the majority of drivers purchase vehicles that are worth $50,000 or less, then you may choose to elect for lower property damage liability limits but still enough to cover the cost of the other driver’s vehicle if it is a total loss and you were at fault.
You can calculate any and all scenarios to get the coverage you need based on the value of your assets (vehicle, home, savings, salary), your lifestyle choices, and what you feel you and your family can live on if you or one of your family members is seriously injured in a car accident and unable to work or in need of home care.
– Uninsured and Underinsured Motorist Coverage
Recall that almost 15 percent of New Jersey drivers are uninsured. Another (likely higher) percent of drivers are underinsured, selecting only the minimum (or slightly above the minimum) requirements to keep their premiums low.
In a no-fault state like New Jersey, it becomes even more imperative to purchase uninsured and underinsured coverage so that your insurance can help you with bodily injuries and property damage you sustain from being hit by someone with little or no coverage.
New Jersey not only provides options to those who can afford at least the minimum coverage requirements. The state also has a low-cost insurance program nicknamed “Dollar a Day” insurance. This type of insurance costs $365 a year and is available to only Medicaid recipients.
The plan is described more under the section Low-Cost Coverage, but when it comes to holding the standard policy, it is important to know about how the Dollar a Day program can affect others who purchase an insurance policy.
Watch this video to get the scoop on what the Dollar a Day program provides in the case that one of its insureds causes an accident.
So you can see how important it is to purchase enough uninsured and underinsured motorist coverage with the standard policy. This type of coverage is required for the standard policy, but the amounts of coverage you select depend on how much your assets are worth.
For example: if an uninsured motorist hits your vehicle and causes $8,000 in damages or totals your vehicle, your uninsured motorist property damage coverage you purchased through your own insurance company will cover the damages or replacement of your vehicle.
So, if you own a particularly expensive vehicle, you will want to have enough of this type of coverage to remedy such a situation.
– Collision and Comprehensive Coverage in New Jersey
Much of the data we have provided up to this point did not take into consideration the value of your vehicle.
If you are in an accident, regardless of who is at fault, you will need coverage to make needed repairs or replace your vehicle if it is totaled.
If the other driver has an insurance policy that meets only the minimum requirements, their policy will pay up to $5,000 in property damage repairs, but it doesn’t take much to run up $5,000 in repairs in a minor fender bender with today’s cost of parts and labor.
Collision coverage will apply when the cost of damage or replacement is higher than $5,000. Note that collision coverage has a deductible which is an amount you will have to pay out of pocket if you make a claim. You can reduce your collision coverage rate by selecting a higher deductible.
In New Jersey, you may choose a collision deductible ranging from $100 to $5,000. In some states, drivers have only two options: $500 or $1,000.
Comprehensive coverage, on the other hand, applies is if your car is stolen or damaged by a falling object, animal, fire, flood, or vandalism. These situations are otherwise known as “acts of God,” meaning you, as the driver, can’t control these occurrences.
If you own a financed vehicle, collision, along with liability and comprehensive (also known as full coverage), will likely be required by your lender.
In New Jersey, you may choose a comprehensive deductible ranging from $50 to $5,000. In some states, drivers have only two options: $500 or $1,000.
If you have an older car, you may not need to purchase collision and comprehensive coverage.
– Add-ons, Endorsements, and Riders
Here’s a list of other useful coverage available to you in New Jersey:
- Guaranteed Auto Protection (GAP)
- Personal Umbrella Policy (PUP)
- Rental Reimbursement
- Emergency Roadside Assistance
- Mechanical Breakdown Insurance
- Non-Owner Car Insurance
- Modified Car Insurance Coverage
- Classic Car Insurance
- Pay-As-You-Drive or Usage-Based Insurance
– Other Factors that Determine Car Insurance Rates
Just when you thought New Jersey car insurance rates couldn’t get any higher, there are characteristics unique to you that may increase or decrease your rate quotes.
We will first examine basic demographics such as gender, age, and marital status. A little later on, we will look at credit scores, driving record, and commute miles for individual car insurance companies.
– Male vs Female Annual Car Insurance Rates in New Jersey
Most are under the impression that men pay higher rates than women. That’s not entirely true in New Jersey’s case. Six states, most recently California, have outlawed charging different insurance rates based on gender and/or marital status.
Our researchers found that the two most influential factors that go into rate calculations are age and the specific carrier.
Let’s see how these demographics factor into rates for New Jersey residents.
– Demographic and Insurance Carrier
Age, gender, marital status, and many other factors go into calculating your rate. To give you an idea of how these few variables affect rates, we provide a table below showing the cheapest average rates for New Jersey’s insurance carriers. Click on the arrows for each column to sort the table.
|Company||Married 35-year old female||Married 35-year old male||Married 60-year old female||Married 60-year old male||Single 25-year old female||Single 25-year old male||Single 17-year old female||Single 17-year old male|
|Allstate NJ P&C||$3,436.75||$3,420.45||$3,335.46||$3,335.46||$4,043.02||$4,156.11||$10,796.36||$13,185.02|
|Foremost Ins Grand Rapids||$4,830.46||$4,873.04||$4,699.01||$4,594.07||$5,737.03||$5,845.35||$14,124.39||$16,232.62|
|Geico Govt Employees||$2,243.42||$2,201.66||$2,188.45||$2,188.45||$2,576.09||$2,513.20||$4,064.28||$4,063.96|
|Liberty Mutual Fire||$4,480.25||$4,480.25||$4,919.44||$4,919.44||$4,919.44||$5,646.81||$11,601.57||$13,165.70|
|Prog Garden State Ins Co||$2,040.52||$1,885.91||$1,841.28||$1,894.85||$2,412.68||$2,305.40||$9,241.04||$10,160.06|
|State Farm Ind||$4,392.28||$4,392.28||$3,976.24||$3,976.24||$5,007.86||$5,593.47||$14,395.61||$18,483.25|
|St Paul Protective Ins Co||$3,221.64||$3,123.67||$2,982.74||$3,008.62||$3,130.99||$3,100.17||$7,272.20||$8,195.88|
You will see that age affects rates to a great extent; after all, we do become more experienced and mature drivers as we age.
If you have a teen driver in your home, Geico may be the best option for your family.
– Cheapest New Jersey Car Insurance Rates by Zip Code and City
Where you live is a huge factor for car insurance rates.
Average rates by zip code and city are shown in the two tables below. Feel free to search the table for your current zip code or maybe cities to which you plan to relocate.
|Zipcode||Highest Rate||Zipcode||Lowest Rate|
|City||Average Grand Total|
|West New York||$7,929.71|
|Egg Harbor City||$5,708.39|
|Egg Harbor Township||$5,582.78|
|Township Of Washington||$5,168.21|
|South Bound Brook||$5,152.41|
|Ho Ho Kus||$5,055.98|
|Cape May Court House||$4,847.75|
|Cape May Point||$4,812.50|
|Sea Isle City||$4,812.50|
|West Long Branch||$4,777.97|
|Avon By The Sea||$4,768.82|
|Point Pleasant Beach||$4,745.92|
New Jersey Car Insurance Companies
When the unexpected happens, which company will meet your unique needs? It can be a challenge to make a choice when there are so many options.
|Property & Casualty Insurance||Number|
To help you begin to make some comparisons, our analysts compiled data for the 10 insurance companies in New Jersey with the cheapest quotes.
Let’s check them out!
– The 10 Largest Car Insurance Companies in New Jersey
Before we get to the cheapest rates, let’s take a look at the largest car insurance companies in New Jersey.
The national market share is mostly dominated by four select companies; however, we have listed the largest ten companies in New Jersey here (as of 2017) to provide you with more options relative to your own state.
The table below displays the market share percentage, total direct premiums written, and loss ratios. The table is sorted by market share; however, you can sort as you like.
|Company||Direct Premiums Written||Loss Ratio||Market Share|
|New Jersey Manufacturers Group||$993,945||66.25%||12.94%|
|Allstate Insurance Group||$839,883||53.02%||10.93%|
|State Farm Group||$629,485||64.66%||8.19%|
|Liberty Mutual Group||$544,321||64.14%||7.09%|
|Farmers Insurance Group||$233,314||79.86%||3.04%|
Remember, these are the loss ratios for all coverage types combined and are for the largest companies, not those with the cheapest rates.
– Car Insurance Companies with the Best Ratings
A.M. Best is a third party entity that provides ratings of companies’ credibility and financial outlook, so this is a great place to start in narrowing down your options.
|Allstate Insurance Group||A+|
|Farmers Insurance Group||A|
|Liberty Mutual Group||A|
|New Jersey Manufacturers Group||A+|
|State Farm Group||A++|
Taking into consideration customer satisfaction ratings is as important as financial stability. The JD Power Circle Ratings in the image below cover the north central region which is comprised of seven states to include New Jersey.
– Companies with Most Complaints in New Jersey
We’ve looked at the positive ratings for financial stability and customer satisfaction. Now it is time to review the negative aspect of ratings: customer complaints.
We took the same ten companies and located their complaint ratios compared to their direct premiums written. So just because a company has the most customers in your state doesn’t necessarily mean those customers are satisfied.
New Jersey releases complaint ratios each year, and 2017 data is their most recent that is published. The table is sorted based on the company name. Feel free to sort and search the table.
A company with a complaint index lower than 1.0 has fewer complaints than average, and a company with a complaint index higher than 1.0 has more complaints than average.
|Company Name||Valid Complaints||Number of Vehicles||Complaint Ratio||Complaint Index|
|Liberty Mutual Group||24||366,389||0.0655||1.736|
|New Jersey Manufacturers Group||1||831,026||0.0012||0.032|
|State Farm Group||19||484,087||0.0392||1.04|
If you would like to submit an official complaint about auto insurance, you can submit it here.
– State Car Insurance Rates by Company
We know New Jersey rates will be higher than other states on average, but some companies will have better rates than others even if it is by only $50 per year.
In this section, we cover the average annual rates for the top seven companies in New Jersey with the cheapest rates based on unique factors to you: your commute, driving record, and chosen coverage level.
But first, let’s look at the cheapest average rates by company overall.
|Company||Average||+/- Compared to State Average||+/- Percent Compared to State Average|
As you can see in the table above, Geico and Progressive have the best rates compared to the state average.
– Commute Rates in New Jersey
|Company||10 miles commute / 6,000 annual mileage||25 miles commute / 12,000 annual mileage|
If you have a long commute, getting a policy with Farmers, Progressive, or Travelers is a good option because all of these companies don’t charge more for a longer commute.
– Liability Coverage Rates in New Jersey
The adage “buy in bulk” applies in most states that the higher the liability limits you select, the better deal you are getting on coverage.
Unfortunately, that is the not case for companies in New Jersey, as you can see in the table below.
|company||low coverage||medium coverage||high coverage|
However, Geico has the best deal when comparing low coverage to medium and high coverage.
Remember that it is personal injury protection which makes New Jersey rates so high. Increasing your liability coverage will be beneficial in only two situations:
- if you regularly drive in another state that is at-fault
- if you are in an accident (in New Jersey) with someone from another state
– Credit History Rates in New Jersey
If you see an increase in your premium, and you did not get a ticket and you were not in an accident, your credit score may have reduced into a lower threshold.
|Company||Good Credit||Fair Credit||Poor Credit|
It appears that Progressive is the most forgiving in its rates if you have poor credit; however, it is still an increase of up to $862 per year.
– Driving Record Rates in New Jersey
If you receive a speeding citation, get into an accident, or get caught drinking and driving, expect your premium to increase. In New Jersey, some companies are more lenient than others.
|Company||Clean Record||One Speeding Ticket||One Accident||One DUI|
In New Jersey, it looks like Geico and Liberty Mutual do not assess a penalty in rate if you get a speeding ticket. These two companies are also more lenient when it comes to getting into an accident.
When it comes to getting a DUI, all seven of the companies will increase your rate; however, Liberty Mutual and Progressive increase rates the least.
Even though New Jersey has one of the highest rates in the country, you can still get a relatively reasonable rate if you do your research.
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– Driving Laws in New Jersey
Car insurance laws vary from state to state, and New Jersey is no different, as we have seen already. In this section, we cover more laws associated with car insurance.
– High-Risk Insurance
The state of New Jersey has established the New Jersey Personal Automobile Insurance Plan (NJPAIP) to assist those who are finding it difficult to purchase coverage from a carrier in the competitive market due to denial of coverage.
You may qualify for the program if you meet one or more of the following criteria:
- a newly licensed driver
- live in high-risk areas
- previously covered by a high-risk auto insurance company
- a young teen driver
- an elderly driver (70 years or older)
- under SR22 filing
- have no prior auto insurance coverage or lapse
- has a history of late pays or poor credit history
- urban dweller – Living in a high-risk area
- has several recent traffic violations; speeding, DUI/DWI, etc.
- recent history of several crashes or car accidents
– Low-Cost Insurance
As mentioned earlier, New Jersey has a program for only Medicaid recipients who have hospital benefits called the Special Automobile Insurance Policy (NJSAIP), or “Dollar a Day” insurance policy. It is called the “Dollar a Day” policy because it costs $360 a year if you pay up-front, or $365 if you pay in two installments.
This insurance policy will cover up to $250,000 in emergency treatment. It also has a death benefit of $10,000.
If you think you may qualify for this plan, read the frequently asked questions on the DOBI website.
– Windshield Coverage
New Jersey law does not require insurance companies to provide windshield repair or replacement, but it is an option through purchasing comprehensive coverage with a standard repair deductible of $750.
– Statute of Limitations
A statute of limitations is the limit on the amount of time you have, from the time of an accident, to bring a lawsuit to court. Most states differentiate time limits for personal injury and property damage matters.
However, New Jersey combines the two, and you have two years to file for the lawsuit for both personal injury and property damage.
– Comparative Negligence
New Jersey is a “modified comparative fault” state.
This statute is used to settle cases in which the injured party is partially at fault. The amount in damages will be reduced if an injured party is found to share the blame. In this case, the plaintiff’s damages award is reduced by a percentage equal to his or her share of fault. If the injured party is found to be 50 percent or more at fault, there is no recovery for damages.
– Vehicle Licensing Laws
Let’s look at what licensing requirements are in place in New Jersey for different groups of people.
– Teen Driver Laws
|Young Driver Licensing Laws||Age Restrictions||Passenger Restrictions||Time Restrictions|
|Learner's Permit||16 and completed driver education; 17 without driver education|
the permit becomes an intermediate license after six months for drivers younger than 21 and after 3 months for drivers 21 and older. The graduated licensing law applies to adults, except that the night driving and passenger restrictions are waived for new drivers 21 and older. If the applicant has not completed driver education, the minimum permit age is 17 and the minimum intermediate license age is 17, 6 months. Learner's permit holders may not drive between 11 p.m. and 5 a.m. and may carry only one passenger in addition to the supervising driver or any parent, guardian or dependant.
|one passenger in addition to the supervising driver or any parent, guardian or dependent (family members excepted); waived for new drivers 21 and older.||11 p.m.-5 a.m.; waived for new drivers 21 and older.|
|Provisional License||minimum age of 17 and 6 months|
6 months holding period; 3 months for drivers 21 and older
|one passenger in addition to the supervising driver or any parent, guardian or dependent (family members excepted); waived for new drivers 21 and older.||11 p.m.-5 a.m.|
|Full License||17||lifted after 12 months or until age 21, whichever occurs first (min. age: 18)||lifted after 12 months or until age 21, whichever occurs first (min. age: 18)|
– Older Driver License Renewal Procedure
|Renewal Procedures||General Population||Older Population|
|License renewal cycle||4 years||2 or 4 years for people 70 and older, personal option|
|Mail or online renewal permitted||by mail, unless new photo required (stored picture can be used, but only for a period not exceeding four additional years)||by mail, unless new photo required (stored picture can be used, but only for a period not exceeding four additional years)|
|Proof of adequate vision required at renewal||every 10 years||every 10 years|
– New Residents
If you plan to relocate to New Jersey, there a few things you need to know to transfer your out-of-state license and register your vehicle.
Before you visit a motor vehicle location, collect forms of identification to meet a total of six identification points as shown on the 6 Points of ID Brochure.
Once you surrender your out-of-state license, you will be issued a four year New Jersey license.
If you are 21, you must complete the Graduated Driver License (GDL) program requirements.
As for your vehicle, you will have 60 days from the date you move to transfer your title and registration. Visit a motor vehicle location with ID, title, and proof of insurance. You will complete a few forms and pay a fee based on if you own or finance your vehicle.
New Jersey currently has been granted an extension until October 2019 to enforce REAL ID requirements.
– Rules of the Road in New Jersey
Knowing the basic driving laws of New Jersey will ensure your safety and keeping your rates from increasing.
– Keep Right and Move Over Laws
All drivers in New Jersey must keep right except to pass on the left or turn left.
Move over laws usually always apply to emergency vehicles; however, in New Jersey, this applies to any vehicle with flashing lights including tow trucks and highway maintenance vehicles. Drivers must move over completely or slow down if moving over is not possible.
– Speed Limits
Maximum posted speed limits are 65 mph on rural interstates, 55 mph on urban interstates, 65 mph on limited access roads, and 55 mph on all other roads.
– Carseat and Cargo Area Laws
Any child younger than two and less than 30 lbs must be in a rear-facing infant seat. From this age and weight, a child must ride in a rear-facing or forward-facing child safety seat until the age of four and 40 lbs.
From age four and 40 lbs to age eight and 57 inches tall, a child must ride in a forward-facing child safety seat or booster seat.
The state of New Jersey does have a preference for the rear seat, if available, for children under the age of 7 and less than 57 inches. If a child must ride in the front seat or in a safety seat in the front seat, the airbag must be disabled.
However, when a child reaches the age of eight and exceeds 57 inches tall, he or she may use an adult seat belt.
Some states permit those who are younger than 16 to ride in cargo areas in the case of parades, for example. New Jersey, on the other hand, permits only employees engaged in work duties to ride in the back of a pickup truck.
Rideshare services like Uber require that all their drivers maintain their own car insurance policies that meet at least the minimum coverages requirements. However, if a driver wishes to obtain special coverage for this role, Farmers and USAA offer specialized rideshare coverage.
– Automation on the Road
According to the Insurance Institute for Highway Safety (IIHS), “automation is the use of a machine or technology to perform a task or function that was previously carried out by a human.
In driving, automation involves using radar, camera and other sensors to gather information about a vehicle’s surroundings, which is then used by computer programs to perform parts or all of the driving task on a sustained basis.”
New Jersey is one of ten states that have at least have laws that authorize a study, define key terms, and/or authorize funding; however, as of May 2019, no additional information is provided regarding additional regulations.
– New Jersey’s Safety Laws
Two basic practices that ensure your safety and the safety of others in New Jersey is to buckle up and obey the speed limits. Other laws exist to prevent impaired or reckless driving.
– DUI Laws
Drinking and driving laws in New Jersey require a blood alcohol level of 0.08 percent or higher to be cited with driving under the influence (DUI).
Unlike other states, in New Jersey, driving under the influence is considered a violation and not a crime with a lookback period of 10 years. However, New Jersey does impose infractions on drunk drivers based on their blood alcohol level for their first offense. Any offenses proceeding the first does not differentiate for blood alcohol level.
|Penalty||First Offense||Second Offense||Third Offense|
|License Suspension||BAC 0.08-0.99: 3 months|
BAC 0.10-0.14: 7 months-1 year
BAC 0.15+: 7 months - 1year, IID during suspension and 6 months - 1 year following restoration
|2nd in 10 years: 2 years; IID during license suspension and 1-3 years after restoration||3rd in 10 years of 2nd: 10 years; IID during suspension and 1-3 years after restoration|
|Imprisonment||minimum 12 hrs. BAC 0.08+: up to 30 days||2nd in 10 years: 48 hours-90 days||3rd in 10 years of 2nd: 180 days|
|Fine||BAC 0.08-0.99: $250-$400|
BAC 0.10-0.14: $300-$500
BAC 0.15+: $300-$500
BAC 0.08+ $3,505 in fees and surcharges
|$500-$1,000; $3,555 in fees and surcharges||3rd in 10 years of 2nd: $1,000 +$5,055 in fees and surcharges|
|Other||12-48 hours Intoxicated Driver Resource Center (IDRC)||12-48 hours IDRC||up to 90 days Community Service; 12-48 hours IDRC|
– Marijuana-Impaired Driving Laws
As of May 2019, New Jersey does not have any specific laws regarding marijuana impairment while driving.
– Distracted Driving Laws
All distracted driving laws in New Jersey are primarily enforced which means you can be pulled over for violating these laws.
Handheld devices and texting are banned for all drivers. All learner’s permit holders and all intermediate license holders are not permitted to use a cellphone.
New Jersey: Fascinating Facts You Need to Know
How safe is it to drive in New Jersey?
Well, the data our researchers found might surprise you.
Let’s examine the statistics of theft and fatalities from risky driving behavior.
– Vehicle Theft in New Jersey
Here are the top-10 stolen cars in New Jersey:
|Make/Model||Number of Thefts|
|Ford Pickup (Full Size)||295|
|Jeep Cherokee/Grand Cherokee||286|
|Ford Econoline E350||184|
Listed below are the top-five cities in which the most vehicles were stolen in 2013.
|City||# of Stolen Cars|
– Risky/Harmful Driving Behavior
Keeping your eyes on the road and staying aware of common risky driving behaviors is the best way to stay safe while driving.
– Weather and Light Condition Fatalities
|Weather Condition||Daylight||Dark, but Lighted||Dark||Dawn or Dusk||Other / Unknown||Total|
– Traffic Fatalities
|Type||Number of Fatalities|
|Passenger Vehicle Occupant Fatalities (All Seat Positions)||331|
|Drivers Involved in Fatal Crashes||865|
|Bicyclist and other Cyclist Fatalities||17|
– Traffic Fatalities by Person Type
|Occupants (Enclosed Vehicles)||340|
– Fatalities by Crash Type
|Involving a Large Truck||54|
|Involving a Rollover||72|
|Involving a Roadway Departure||266|
|Involving an Intersection (or Intersection Related)||197|
– Five-Year Trend for the Top 10 Counties
|Top Ten Counties||377||375||368||404||418|
|All Other Counties||165||181||193||198||206|
– Fatalities Involving Speeding by County
|Cape May County||1||4||0||3||2|
– Fatalities in Crashes Involving an Alcohol-Impaired Driver by County
|Cape May County||2||5||1||5||3|
– Teen Drinking and Driving
|Teens and Drunk Driving||Data|
|Alcohol-Impaired Driving Fatalities Per 100K Population||0.3|
|Higher/Lower Than National Average (1.2)||lower|
|DUI Arrest (Under 18 years old)||129|
|DUI Arrests (Under 18 years old) Total Per Million People||65|
|US Rank of Under 18 DUI Arrests||32nd|
– EMS Response Time
|Location||Time of Crash to Notification||Arrival||Arrival at Scene to Hospital||Time of Crash to Hospital|
|Rural||4.14 minutes||13.22 minutes||36.48 minutes||53.84 minutes|
|Urban||5.14 minutes||7.82 minutes||31.62 minutes||43.70 minutes|
If you live in New Jersey, chances are you own one or two cars for your household, drive alone to work, and spend 10-34 minutes commuting.
– Car Ownership
– Commute Time
With an average commute time of 30.6 minutes, New Jersey ranks above the national average of 25.3 minutes.
That means 5.42 percent of New Jersey residents suffer through a “super commute” spending in excess of 90 minutes in the car!
– Commuter Transportation
Most people in New Jersey drive to work alone.
Don’t waste another minute. Start comparison shopping car insurance rates today.