New Jersey Car Insurance
New Jersey is one of the country's most distinctive auto-insurance markets. It offers two different policy types under AICRA: a Standard Policy with mandatory liability, PIP, and Uninsured Motorists coverage, and a Basic Policy with substantially reduced mandatory coverages and different lawsuit rights7. On a Standard Policy the minimum liability floor is now 35/70/25 effective January 1, 2026 under P.L. 2022, c.111 (Phase 2 of a two-phase increase; Phase 1 was 25/50/25 on January 1, 2023)12. Every Standard Policy holder also elects between limitation on lawsuit (verbal threshold) and no limitation on lawsuit under N.J.S.A. 39:6A-8, and elects PIP anywhere from $15,000 up to the default $250,000 under N.J.S.A. 39:6A-4.345. This page owns the New Jersey rule; the consumer journey lives on our situation guides.
YesWeSure Bottom Line
The Basic-vs-Standard choice is the first decision. The Basic Policy is cheaper but carries reduced coverage and does not include mandatory UM. A "state minimum" quote is not meaningful in New Jersey without knowing which policy type is being quoted7.
On a Standard Policy, the 2026 floor is 35/70/25. Effective January 1, 2026, P.L. 2022 c.111 raised the Standard-Policy liability minimum from 25/50/25 to 35/70/2512. Renewal notices at or after that date reflect the new floor.
PIP is unusually flexible in New Jersey. N.J.S.A. 39:6A-4.3 sets a Standard Policy default of $250,000 per person and allows buy-down to $150,000, $75,000, $50,000, or $15,000. Even at the lowest selected limit the statute preserves a $250,000 reserve for enumerated catastrophic injuries and for emergency care until stabilized4. Coordinating with health insurance is a separate decision (health-insurance-primary rule).
The lawsuit-option election drives premium and recovery rights. "Limitation on lawsuit" (verbal threshold) lowers premium but limits your ability to sue for noneconomic damages after an accident to the injury categories the statute enumerates. "No limitation on lawsuit" preserves broad tort rights at higher premium5. Personal decisions on this election belong with a licensed New Jersey producer, not on this page.
State requirements at a glance
What New Jersey car insurance law requires
Two-policy structure (unique to NJ)
Standard Policy vs Basic Policy7
AICRA authorizes two products. The Standard Policy is the default with mandatory liability, PIP, and UM. The Basic Policy is a reduced-coverage option with lower mandatory limits and different lawsuit rights. Choose deliberately; the two are not interchangeable.
Standard Policy minimum liability
35 / 70 / 251
$35,000 bodily injury per person, $70,000 per accident, $25,000 property damage. Effective January 1, 2026 under P.L. 2022, c.111 (Phase 2). Phase 1 raised limits to 25/50/25 on January 1, 2023.
PIP on Standard Policy
$250,000 default; buy-down to $15K allowed4
N.J.S.A. 39:6A-4.3 sets Standard Policy PIP at $250,000 per person per accident by default; the named insured may elect lower PIP limits ($15,000, $50,000, $75,000, or $150,000). Even at a lower selection, PIP pays up to $250,000 for certain catastrophic injuries and for emergency care until stabilized.
Lawsuit-option election
Limitation vs no limitation on lawsuit5
On a Standard Policy the named insured elects between "limitation on lawsuit" (verbal threshold) and "no limitation on lawsuit" under N.J.S.A. 39:6A-8. The verbal threshold limits noneconomic-damages recovery to specified injury categories in exchange for lower premium.
Uninsured Motorists on Standard Policy
Mandatory at 15 / 30 / 5 minimum6
N.J.S.A. 17:28-1.1 requires Standard Policy UM at not less than $15,000 per person / $30,000 per accident bodily injury and $5,000 property damage. UM may be purchased up to but not exceeding the policy's liability limits.
Underinsured Motorists
Optional up to policy liability limits6
UIM is optional on a Standard Policy and cannot exceed the insured's bodily-injury liability limits. If BI is 35/70, UIM cannot be purchased above 35/70.
Basic Policy coverages
Reduced; no mandatory UM7
The Basic Policy carries substantially reduced mandatory coverages (see NJ DOBI Buyer's Guide for specifics) and does not include mandatory UM. It is typically a cheaper option for drivers with limited assets, but it is not a "state minimum" for every consumer.
MVC enforcement of lapse
Insurer-reported cancellation triggers action9
The NJ MVC Uninsured Motorist Unit acts on insurer-reported cancellations. Consequences include fines, community service, driver-license suspension, and insurance surcharges.
Standard Policy vs Basic Policy: the two-policy choice
The Auto Insurance Cost Reduction Act (AICRA) authorizes two distinct products in New Jersey. The choice matters because the two products carry different mandatory coverages and different lawsuit rights7.
- Standard Policy. Default product for most drivers. Includes mandatory liability, PIP, and Uninsured Motorists coverage. The named insured elects PIP limits and the lawsuit option at issuance and at renewal.
- Basic Policy. Lower-cost option with substantially reduced mandatory coverages. Basic Policies do not include mandatory UM under N.J.S.A. 17:28-1.1 and carry different lawsuit-recovery limits. A driver considering a Basic Policy should review the NJ DOBI Buyer's Guide directly and, ideally, consult a licensed New Jersey producer before selecting it7.
The rest of this page focuses on the Standard Policy structure, which applies to the majority of New Jersey drivers.
The 35/70/25 Standard Policy floor (effective 2026)
P.L. 2022, c.111 raised New Jersey Standard Policy minimum bodily-injury and property-damage liability limits in two phases23:
- Phase 1 (effective January 1, 2023): 25/50/25: $25,000 bodily injury per person, $50,000 per accident, $25,000 property damage.
- Phase 2 (effective January 1, 2026): 35/70/25: $35,000 bodily injury per person, $70,000 per accident, $25,000 property damage1.
NJ DOBI Bulletin 25-06 reminds insurers of the January 1, 2026 change and describes insurer obligations: update rate filings and policy forms, provide revised Buyer's Guides, notify policyholders of increased limits at renewal, and raise limits without obtaining a new signed coverage-selection form1.
These limits pay only third-party bodily injury and property damage; they do not pay for your own vehicle (collision) or your own medical bills (PIP handles those). Personal coverage-limit decisions belong on our coverage-limits guide.
PIP: $250,000 default with buy-down and catastrophic reserve
New Jersey's no-fault Personal Injury Protection is among the most consumer-flexible in the country. N.J.S.A. 39:6A-4.3 sets Standard Policy PIP at $250,000 per person per accident by default and allows the named insured to elect one of the following lower limits at issuance and renewal: $150,000, $75,000, $50,000, or $15,0004.
Even where the insured elects a lower PIP limit, the statute preserves a $250,000 catastrophic reserve for enumerated injury categories and for emergency care until the injured person is stabilized4. The enumerated categories include traumatic brain injury, spinal-cord injury with substantial functional impairment, and certain disfigurement or scarring, subject to the specific statutory definitions.
Health-insurance-primary option. Where the household carries qualifying private health insurance, N.J.S.A. 39:6A-4.3 permits electing health insurance as primary for PIP medical benefits. Coordination reduces premium but is not appropriate for every household. Verify eligibility of the household's health plan and confirm the election in writing with the auto insurer at issuance and renewal.
Limitation on lawsuit vs no limitation: the AICRA election
Under N.J.S.A. 39:6A-8, every Standard Policy named insured elects between "limitation on lawsuit" (verbal threshold) and "no limitation on lawsuit"5. The two options behave very differently after a covered accident:
- Limitation on lawsuit (verbal threshold). Lower premium in exchange for a limit on noneconomic- damages recovery. To sue for pain and suffering, the injured party must establish that the accident caused one of the statutorily enumerated injury categories: death, dismemberment, significant disfigurement or scarring, displaced fractures, loss of fetus, or a permanent injury within a reasonable degree of medical certainty5.
- No limitation on lawsuit. Higher premium in exchange for broad tort rights. The insured retains the right to sue for noneconomic damages without meeting the statutory injury categories.
This is one of the most consequential decisions on a New Jersey policy. It is properly a personal decision based on the household's risk tolerance, assets, and legal preferences, and it should be discussed with a licensed New Jersey producer or attorney rather than resolved by a general-purpose article. This page states the mechanic; the decision is not published here.
Uninsured / Underinsured Motorists on a Standard Policy
N.J.S.A. 17:28-1.1 requires every New Jersey Standard Policy to include Uninsured Motorists coverage at not less than $15,000 per person / $30,000 per accident for bodily injury and $5,000 for property damage6. UM may be purchased above the statutory minimum but not above the policy's bodily-injury liability limits.
Underinsured Motorists (UIM) is optional on a Standard Policy. When elected, UIM cannot exceed the named insured's bodily-injury liability limits. If a Standard Policy carries the new 35/70 minimum, UIM cannot be purchased above 35/706. Consumers seeking meaningful UIM protection generally raise the underlying BI limits first, because UIM is capped at BI.
Basic Policies are exempt from the mandatory UM requirement under N.J.S.A. 17:28-1.16. This is one of the ways a Basic Policy differs materially from a Standard Policy at claim time.
NJ MVC enforcement: reporting, lapse, and surcharges
Insurers licensed in New Jersey electronically report policy inception, cancellation, and reinstatement events for registered vehicles to the New Jersey Motor Vehicle Commission10. The NJ MVC Uninsured Motorist Unit acts on lapse reports and administers consequences9:
- Fines. Statutory monetary penalties apply on conviction for driving an uninsured registered vehicle.
- Driver-license suspension. The MVC Uninsured Motorist Unit administers license suspensions for confirmed uninsured status. Verify current durations and reinstatement steps with NJ MVC directly.
- Insurance surcharges. The Merit- Rating Program under the Motor Vehicle Commission applies surcharges for enumerated convictions including driving without insurance.
- Community service. Statutory community-service obligations may apply on certain uninsured-driving convictions.
Reentry mechanics after a lapse (reinstatement, insurer underwriting treatment, and how a lapse can affect the next policy) live on our after-a-lapse guide. This State Guide states only the New Jersey rule.
Proof of insurance and MVC verification
NJ MVC accepts insurance identification cards in paper or electronic form. Electronic display on a phone, tablet, or computer satisfies the proof requirement at a traffic stop or an MVC transaction8. Insurance-card display does not replace electronic verification with the MVC; both channels operate.
Rating-factor treatment
New Jersey does not maintain a comprehensive statewide prohibition on credit-based insurance scoring in personal auto insurance comparable to California's or Massachusetts's. NJ DOBI regulates rating factors through its rate-filing approval process; insurers must have approved factors on file before use, subject to statutory nondiscrimination requirements. Because rating-factor availability changes through DOBI filings rather than through a single headline rule, this page does not publish a comprehensive list; personal rating-factor framing lives on our how insurers calculate rates guide.
Where the New Jersey situation rules live on YesWeSure
- After an accident. General after-accident premium framing and the three-clocks model live on our after-an-accident guide. Specific New Jersey merit-rating consequences flow through the MVC surcharge program noted above.
- After a DUI. DUI-specific insurance consequences (SR-22 relevance, filing mechanics, license interaction) live on our after-a-DUI guide. This State Guide does not publish a New Jersey-specific SR-22 duration; verify with NJ MVC and a licensed producer.
- After a lapse. Reinstatement, insurer underwriting treatment, and how a lapse can affect the next policy are covered on our after-a-lapse guide.
- Moving into New Jersey. Registration and proof-of-insurance timing for new residents are covered on our moving-to-another-state guide. This State Guide does not publish a specific new- resident deadline in days; verify with NJ MVC.
What we verified for this page
- Strong35/70/25 Standard Policy liability minimums effective January 1, 2026 verified against NJ DOBI Bulletin 25-06 and P.L. 2022, c.111 (Phase 2). Phase 1 at 25/50/25 was effective January 1, 2023.
- StrongStandard Policy PIP $250,000 default with buy-down options ($15K / $50K / $75K / $150K) and the catastrophic-injury reserve verified against N.J.S.A. 39:6A-4.3.
- StrongLimitation-on-lawsuit vs no-limitation- on-lawsuit election and the enumerated injury categories under verbal threshold verified against N.J.S.A. 39:6A-8.
- StrongMandatory UM at 15/30/5 on Standard Policies and Basic Policy exemption from mandatory UM verified against N.J.S.A. 17:28-1.1. UIM optional and capped at BI limits.
- StrongStandard Policy vs Basic Policy distinction under AICRA verified against the NJ DOBI Auto Insurance Buyer's Guide.
- StrongNJ MVC electronic proof-of-insurance acceptance (paper or electronic) and Uninsured Motorist Unit enforcement (fines, license suspension, surcharges, community service) verified against NJ MVC Insurance Requirements and the Uninsured Motorist Enforcement FAQ.
- ModerateCross-check against existing frozen pages. The single existing New Jersey reference on YesWeSure (follow-car question page listing NJ among no-fault/PIP jurisdictions) was checked against current AICRA. Consistent. No conflict; no frozen page required edits.
- ModerateRating-factor treatment. New Jersey does not maintain a headline statewide prohibition on credit-based insurance scoring in personal auto comparable to California's. Rating-factor availability is regulated through DOBI rate-filing approval. The page frames this accurately and delegates personal rating-factor framing to our rates guide.
- LimitedDeliberately omitted from V1. A New Jersey modeled cost anchor; a New Jersey premium average; specific MVC fine and surcharge dollar amounts by conviction category (verify current amounts with NJ MVC); a specific new- resident registration deadline in days (verify with NJ MVC); a full list of DOBI-approved rating factors; a New-Jersey-specific SR-22 duration; telematics program detail; and a comprehensive Basic Policy coverage table. Each will land on a dedicated subpage as primary evidence supports.
- LimitedNamed author and expert reviewer. V1 attributes to “YesWeSure Editorial.” A named auto-insurance editor and a New Jersey- licensed reviewer are tracked as a pre-launch YMYL item across all reference families.
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Common questions
What is the current minimum car insurance in New Jersey?
On a Standard Policy, the minimum bodily-injury liability is 35/70 and property-damage liability is $25,000 effective January 1, 2026 under P.L. 2022, c.111 (Phase 2)12. The Standard Policy also requires PIP and UM. The Basic Policy is a distinct product with reduced coverage and different lawsuit rights.
What is the difference between a Standard Policy and a Basic Policy?
Both exist under AICRA. The Standard Policy is the default with mandatory liability, PIP, and UM. The Basic Policy is cheaper with substantially reduced mandatory coverages and does not include mandatory UM. Consult the NJ DOBI Buyer's Guide and a licensed New Jersey producer before choosing a Basic Policy7.
How much PIP is required in New Jersey?
N.J.S.A. 39:6A-4.3 sets the Standard Policy PIP default at $250,000 per person. The named insured may elect $150,000, $75,000, $50,000, or $15,000. Even at a lower selection, PIP pays up to $250,000 for enumerated catastrophic injuries and for emergency care until stabilized4.
What is the "limitation on lawsuit" option?
Under N.J.S.A. 39:6A-8, the named insured on a Standard Policy elects between limitation on lawsuit (verbal threshold) and no limitation on lawsuit. Limitation on lawsuit reduces premium but caps noneconomic-damages recovery to statutorily enumerated injury categories5.
Is Uninsured Motorists coverage required in New Jersey?
Yes on a Standard Policy: N.J.S.A. 17:28-1.1 requires UM at not less than 15/30 bodily injury and $5,000 property damage. UM may be purchased up to (but not above) the policy's liability limits6. Basic Policies are exempt from the mandatory UM requirement.
Can I get UIM at higher limits than my liability limits?
No. UIM is optional but cannot exceed the named insured's bodily-injury liability limits under N.J.S.A. 17:28-1.16. If you want meaningful UIM, raising BI limits is the required first step.
Can I coordinate NJ PIP with my health insurance?
Where the household carries qualifying private health insurance, N.J.S.A. 39:6A-4.3 permits electing health insurance as primary for PIP medical benefits. This can reduce PIP premium but is not appropriate for every household. Verify plan eligibility and confirm the election in writing with the auto insurer at issuance and renewal4.
What happens if my New Jersey policy lapses?
NJ MVC's Uninsured Motorist Unit administers consequences including fines, driver-license suspension, insurance surcharges, and community service on certain uninsured-driving convictions9. Reentry mechanics live on our after-a-lapse guide.
Sources & methodology
- New Jersey Department of Banking and Insurance: Bulletin 25-06 (2025). Reminds insurers of the increased Standard Policy minimum bodily-injury liability limits effective January 1, 2026 (35/70) under P.L. 2022, c.111, and describes insurer notification and rate-filing obligations at renewal. (New Jersey Department of Banking and Insurance, TIER 1)
- New Jersey Public Law 2022, c.111. Two-phase increase to the Standard Policy minimum bodily-injury liability limits: to 25/50/25 effective January 1, 2023, and to 35/70/25 effective January 1, 2026. Amends N.J.S.A. 39:6B-1. (New Jersey Legislature, TIER 1)
- N.J.S.A. 39:6B-1: Motor vehicle liability insurance coverage; minimum amounts. Establishes the compulsory liability floor for New Jersey Standard Policies as amended by P.L. 2022, c.111. (New Jersey Legislature (via Justia Codes), TIER 1)
- N.J.S.A. 39:6A-4.3: PIP limits under AICRA. Standard Policy PIP default is $250,000 per person per accident, with buy-down options ($15,000, $50,000, $75,000, $150,000, $250,000). Even with a lower selected limit, PIP pays up to $250,000 for certain enumerated catastrophic injuries and for emergency care until stabilized. (New Jersey Legislature (via Justia Codes), TIER 1)
- N.J.S.A. 39:6A-8: Election of tort option ("limitation on lawsuit" or "no limitation on lawsuit"). On a Standard Policy the named insured elects between the two options. Limitation on lawsuit (verbal threshold) limits noneconomic-damages recovery to specified injury categories including death, dismemberment, significant disfigurement or scarring, displaced fractures, loss of fetus, and permanent injury. (New Jersey Legislature (via Justia Codes), TIER 1)
- N.J.S.A. 17:28-1.1: Required Uninsured Motorist coverage on New Jersey Standard Policies at not less than $15,000 per person / $30,000 per accident and $5,000 property damage. UIM is available up to policy liability limits when elected. Basic Policies are exempted from mandatory UM. (New Jersey Legislature (via Justia Codes), TIER 1)
- New Jersey Department of Banking and Insurance: Auto Insurance Buyer's Guide. Consumer-facing summary of the Standard Policy, the Basic Policy, PIP options, and the lawsuit-option election required at issuance and renewal. (New Jersey Department of Banking and Insurance, TIER 1)
- New Jersey Motor Vehicle Commission: Insurance Requirements. Consumer-facing summary of proof-of-insurance requirements and NJ MVC enforcement. (New Jersey Motor Vehicle Commission, TIER 1)
- New Jersey MVC: Uninsured Motorist Enforcement (Frequently Asked Questions). NJ MVC Uninsured Motorist Unit administers driver-license suspensions when a registered vehicle's liability coverage has been reported cancelled or lapsed. (New Jersey Motor Vehicle Commission, TIER 1)
- New Jersey MVC Insurer Reporting Manual. Describes insurer electronic reporting requirements to NJ MVC for policy inception, cancellation, and reinstatement events on registered vehicles. (New Jersey Motor Vehicle Commission, TIER 1)
- YesWeSure: Car insurance after an accident (YesWeSure, INTERNAL)
- YesWeSure: Car insurance after a DUI (YesWeSure, INTERNAL)
- YesWeSure: Car insurance after a lapse in coverage (YesWeSure, INTERNAL)
- YesWeSure: Car insurance when moving to another state (YesWeSure, INTERNAL)
- YesWeSure: How much is car insurance? National cost hub (YesWeSure, INTERNAL)
- YesWeSure: How to choose coverage limits (YesWeSure, INTERNAL)
- YesWeSure: How insurers calculate rates (YesWeSure, INTERNAL)
- YesWeSure: What is medical payments coverage? (New Jersey is a no-fault / PIP state) (YesWeSure, INTERNAL)
- YesWeSure: New York car insurance state guide (YesWeSure, INTERNAL)
- YesWeSure: California car insurance state guide (YesWeSure, INTERNAL)
- YesWeSure: Florida car insurance state guide (YesWeSure, INTERNAL)
- YesWeSure: Texas car insurance state guide (YesWeSure, INTERNAL)
Evidence hierarchy on this page: Tier 1 (New Jersey Statutes, NJ DOBI, NJ MVC). No Tier 2 or Tier 3 publisher figures appear on this page; a New Jersey modeled cost anchor is deliberately omitted from V1 and will land on a future subpage with full provenance. Every legal number on this page traces to a New Jersey primary source: N.J.S.A. 39:6A-4.3, 39:6A-8, 39:6B-1, and 17:28-1.1, together with NJ DOBI Bulletin 25-06 (P.L. 2022, c.111 implementation) and NJ MVC enforcement materials. This page is informational and does not constitute legal, tax, or insurance advice. Last reviewed .