New Jersey is one of only a few states that follows a no-fault car insurance system. This means that after a car crash, your own insurance pays for your medical bills, no matter who caused the accident. But this system can be confusing. It affects what type of insurance you need and whether or not you can sue someone after a crash.
Let’s break down how New Jersey’s no-fault laws work, what kind of insurance you need, and when you’re allowed to file a lawsuit after an accident.
What Does It Mean to Live in a No-Fault State?
In a no-fault state like New Jersey, drivers must carry something called Personal Injury Protection, or PIP. This coverage helps pay for medical bills, lost wages, and other costs related to injuries from a crash. The main idea behind no-fault laws is to help people get treatment quickly without having to wait to figure out who caused the accident.
Even if another driver was clearly at fault, you’ll turn to your own PIP insurance first for help. This can include costs for you, passengers in your car, and even family members living in your household.
Required Car Insurance in New Jersey
All drivers in New Jersey are required to carry certain types of auto insurance. Here’s a quick breakdown of what’s needed:
- Personal Injury Protection (PIP) – This is the no-fault part of the policy. The minimum required amount is $15,000 per person, per accident. Many people choose more coverage—up to $250,000 or even higher—to better protect themselves.
- Liability Insurance – This covers damage you may cause to other people or property. New Jersey’s minimum required property damage liability coverage is $5,000.
- Uninsured/Underinsured Motorist Coverage – This kicks in if you’re hit by someone who doesn’t have insurance or doesn’t have enough to cover the damage.
There are two main types of car insurance policies in New Jersey: the Basic Policy and the Standard Policy. The Basic Policy offers lower limits and fewer rights. The Standard Policy allows you to choose higher coverage amounts and more options, like the right to sue.
How Is Fault Determined in a New Jersey Crash?
While your PIP coverage handles most of your medical bills no matter who caused the accident, fault still matters when the damage is serious. New Jersey uses something called modified comparative negligence. This means:
- You can only recover money from another driver if you were less than 50% at fault.
- If you were partly at fault, the amount you can collect is reduced by your share of the blame.
For example, if you were 30% at fault and your total damages were $100,000, you could only collect $70,000.
Can You File a Lawsuit in New Jersey?
Yes, but it depends on the type of insurance policy you have and the extent of your injuries.
When you buy your insurance, you have to choose between a limited right to sue and an unlimited right to sue.
Limited Right to Sue – This only allows you to sue if your personal injuries are considered severe. Examples include:
- Permanent injury
- Loss of a body part
- Significant disfigurement or scarring
- Displaced bone fractures
- Loss of a fetus
- Death
Unlimited Right to Sue – This gives you the ability to sue for pain and suffering, even for minor injuries. It also lets you sue the other driver without having to meet the “serious injury” threshold.
If you’ve chosen the Basic Policy or selected the limited right to sue under a Standard Policy, you’ll need to prove that your injuries meet the state’s requirements before you can file a lawsuit.
What Damages Can You Recover?
If your injuries are serious enough or you have an unlimited right to sue, you may be able to recover:
- Medical expenses not covered by PIP
- Lost income
- Pain and suffering
- Property damage
- Out-of-pocket costs, like transportation or home care
Keep in mind that these types of damages often require strong documentation and proof of fault.
What to Do After a Car Accident in New Jersey
The steps you take after a car crash can affect your ability to recover compensation later. Here are some things to do:
- Report the accident to police and your insurance company.
- Get medical attention as soon as possible, even if you feel okay.
- Document everything — injuries, doctor visits, car damage, and other related costs.
- Don’t admit fault or sign anything from the other driver’s insurance company.
- Talk to a lawyer who knows how New Jersey’s no-fault system works.
Getting legal help can be important, especially if your injuries are serious or your insurance company isn’t paying what it should.
Talk to a Lawyer Who Can Help
Going through the no-fault insurance system in New Jersey can feel overwhelming, especially after a crash. If you’re unsure about your rights or need help recovering damages, talking to a car accident attorney can make a big difference.
Call (732) 229-3200 today to speak with a lawyer at Chamlin, Uliano & Walsh. We’ll explain your options, help with insurance claims, and fight for the compensation you deserve.