What Does New Jersey Require for Car Insurance?
New Jersey is a no-fault insurance state. This means drivers first turn to their own insurance coverage for medical bills and certain expenses, no matter who caused the accident.
Every driver must carry minimum insurance to legally drive. Before 2023, the required amounts were:
- $15,000 in bodily injury liability per person
- $30,000 in bodily injury liability per accident
- $5,000 in property damage liability
- $15,000 in personal injury protection (PIP)
- $15,000 in uninsured/underinsured motorist coverage per person
- $30,000 uninsured/underinsured motorist coverage per accident
These numbers were considered very low, especially with the high cost of medical care and car repairs.
New Minimum Coverage in 2023
On January 1, 2023, new limits went into effect:
- $25,000 in bodily injury liability per person
- $50,000 in bodily injury liability per accident
- $25,000 in property damage liability
- $15,000 in personal injury protection (PIP)
- $25,000 in uninsured/underinsured motorist coverage per person
- $50,000 uninsured/underinsured motorist coverage per accident
This increase came from Bill S482, which aimed to give drivers better protection in the event of a crash.
Future Increases in 2026
Another round of higher limits is already scheduled. Starting January 1, 2026, the minimums will be:
- $35,000 in bodily injury liability per person
- $70,000 in bodily injury liability per accident
- $35,000 in uninsured/underinsured motorist coverage per person
- $70,000 uninsured/underinsured motorist coverage per accident
Property damage coverage will remain at $25,000. These higher numbers will give injured drivers more options when recovering costs after a collision.
Additional Insurance Coverage Available in New Jersey
While minimum coverage is required, many drivers choose to purchase more. Optional insurance can help cover losses that go beyond the state minimums. Examples include:
- Collision coverage to repair your own car after a crash
- Comprehensive coverage for theft, fire, or storm damage
- Gap coverage for loan or lease payoff
- Uninsured and underinsured motorist coverage beyond the minimums
- Rental car reimbursement
- Income continuation benefits
- Extended medical benefits
- Roadside assistance
- Funeral expense coverage
- Unlimited right to sue coverage
Optional policies give more security, especially when medical bills or property damage are high.
What Happens If Accident Expenses Are Greater Than Your Coverage?
It is common for car accident expenses to go over the limits of minimum insurance. A hospital stay, surgery, or long-term treatment can easily exceed $25,000.
If your expenses are higher than your coverage, there are a few options:
- Use optional policies if you purchased them
- File a liability claim against the at-fault driver if you suffered permanent or life-altering injuries
- Use the Unlimited Right to Sue option if you chose that coverage
Without extra coverage, you may be left paying out-of-pocket for costs your policy does not cover.
Understanding New Jersey’s No-Fault Law
The no-fault law requires drivers to use their personal injury protection (PIP) first. Even if another driver caused the crash, you file claims under your own policy for medical treatment and related costs.
However, the law does allow lawsuits in certain cases. You may step outside the no-fault system if you suffer serious injuries such as broken bones, permanent disability, or significant disfigurement.
Basic vs. Standard Auto Insurance Policy
New Jersey offers two main types of auto insurance policies.
- A basic policy provides only the minimum protections. It is cheaper but leaves drivers exposed to high bills if damages are serious.
- A standard policy offers higher coverage limits and extra options. Within this policy, drivers choose between a Limited Right to Sue or Unlimited Right to Sue option.
The Limited Right to Sue policy only allows lawsuits for serious injuries like permanent injury, loss of a body part, or severe scarring. The Unlimited Right to Sue option allows a driver to pursue pain and suffering damages for any injury, even if it is minor.
What to Do After a Car Accident in New Jersey
If you are in a crash, take the following steps:
- Call 911 if anyone is hurt or if property damage is over $500
- Exchange driver and witness information
- Take photos of the vehicles, the scene, and your injuries
- Report the accident to your insurance company
- Seek a medical evaluation, even if you feel fine at the moment
- Do not accept a quick settlement offer before understanding your rights
A car accident can leave you with medical expenses, lost wages, and long-term challenges. Acting quickly helps protect your ability to recover compensation.
How a New Jersey Car Accident Lawyer Can Help
Insurance companies often try to pay as little as possible. A lawyer can review your coverage, explain your legal options, and pursue compensation for medical bills, lost wages, and pain and suffering. They can also help if your expenses exceed your insurance limits or if you need to file a lawsuit outside the no-fault system.
Call for Help After a Car Accident
Car insurance minimums in New Jersey have gone up, and more increases are coming in 2026. Even with these changes, accident costs can quickly exceed what basic policies cover. Optional coverage and legal support can make a major difference in your recovery.
If you were injured in a crash and need help with insurance claims or legal action, call (732) 229-3200 to speak with our Monmouth County accident lawyers today.