New Jersey car insurance

A full-coverage car insurance policy costs about $263 per month or $3,158 a year in New Jersey. A state minimum policy costs about $138 per month, or $1,655 per year. Your own rate will vary depending on the insurance company and coverage you choose, your driving record, credit, location, the amount you drive each year, and your vehicle, among other factors.

A typical New Jersey driver pays about $263 a month, or $3,158 a year, for full coverage, and about $138 a month ($1,655 a year) for minimum coverage.

New Jersey’s full coverage rates place it higher than the all-state average, including the District of Columbia. And the state minimum coverage policy is on the pricier side, too. However, with the new, higher minimum coverage levels, even the minimum liability policy in New Jersey provides more liability protection than policies do in most other states.

Why is New Jersey car insurance so expensive?

New Jersey premiums are based on claims experience, where the vehicle is garaged, vehicle and repair costs, driver characteristics, and the coverage choices you make with your policy.²

Additionally, New Jersey is largely urban and also densely populated compared to most states. With more cars in less space, there are more opportunities for collisions, which in turn increases the odds of a claim.

That said, you may be able to reduce your premiums by customizing your policy.²

As of January 1, 2026, a standard New Jersey policy must carry at least $35,000 in bodily injury liability per person, $70,000 per accident, and $25,000 in property damage (35/70/25), which is higher than most states.

You must also carry personal injury protection and uninsured/underinsured motorist coverage. According to a 2025 study by the Insurance Research Council, New Jersey was among the states that saw the largest increase in uninsured motorist rates.³

The mandated liability minimums are up from 25/50/25 in 2025, though the state minimum property-damage requirement stayed put at $25,000.¹ These 35/70/25 limits apply to New Jersey’s Standard Policy.

If damages exceed your liability limit, you may be held personally responsible for the difference. So if you have assets to protect, consider buying more than the minimum.

The state also allows you to own a Basic Policy, a stripped-down policy that carries lower requirements and is exempt from the 2026 increase.¹

New Jersey basic vs standard policies: Which is right for you?

Most New Jersey drivers choose the Standard Policy. This is pricier, but it offers more protection. The Basic Policy costs less, but you give up bodily injury liability, uninsured/underinsured motorist coverage, and all but $15,000 of your personal injury protection (PIP).²

Before you choose the Basic Policy, ask yourself a few important questions: 

• Do you have income or savings that could be garnished or attached in a lawsuit?

• Do you have people who depend on that income?

• Could you cover your own medical bills past $15,000?

How does New Jersey’s no-fault PIP system work?

In New Jersey, personal injury protection (PIP) pays your covered medical expenses regardless of fault, up to the limit you select. Additionally, a New Jersey Standard Policy lets you choose whether to limit your right to sue an at-fault driver for pain and suffering.²

Here’s how it works: 

• Limited Right to Sue. This is sometimes called the limitation on lawsuit or verbal threshold option. A New Jersey basic policy comes with the limited right to sue option built in.²

  The limited option is cheaper because it caps what insurers pay out on pain-and-suffering claims. You can still sue an at-fault driver for pain and suffering, but only if your injury meets certain severity criteria: Loss of a body part, significant disfigurement or significant scarring, a displaced fracture, loss of a fetus, a permanent injury, or death.²

• Unlimited Right to Sue. This is also called the no limitation on lawsuit option. It costs more than the limited option, but you retain the right to sue the other driver for pain and suffering after any injury.

If you’re on a very tight budget, the limited option keeps your premiums low, but you get less protection in the event you are injured.

GEICO has the lowest average premiums in the state for full coverage, followed closely by a local carrier, New Jersey Manufacturers (NJM). Both carriers average less than $180 per month.

The same driver can pay more than three times as much at the priciest New Jersey insurer as at the cheapest. Luva compares New Jersey carriers on identical coverage so you can see where your profile actually lands.

In New Jersey, you can significantly reduce your insurance premiums by lowering your PIP limit and choosing the limited right to sue option. Most other states don’t allow this flexibility. But the lower premiums come at a cost: Less protection in the event you are injured in a crash. Other factors also shape your premium, such as your driving record, credit, age, location, vehicle value, and repair costs. 

How does location affect New Jersey car insurance rates?

Dense, high-traffic areas with more theft and pricier repairs tend to cost more than rural ones. Here’s a look at the average premiums across New Jersey cities.

How do violations affect New Jersey car insurance rates?

Your driving record is one of the biggest factors in car insurance pricing. A speeding ticket, an at-fault accident, and a DUI each result in significant premium increases.

A first or second DWI conviction also brings a separate $1,000 annual MVC surcharge for three years, and the Commission lists a $1,500 annual surcharge for a third DWI when its recency rule applies.⁴

Does New Jersey require an SR-22?

No. The SR-22 is a certificate of financial responsibility that an insurer files with the state to prove a high-risk driver is carrying the required coverage. However, unlike most states, New Jersey does not use it.Instead, New Jersey restores driving privileges on your own proof of coverage, not on an insurer filing.⁵

What is the New Jersey Personal Automobile Insurance Plan (PAIP)?

If you’re unable to find coverage in the regular car insurance market, you can go through the New Jersey Personal Automobile Insurance Plan (PAIP). This is the state’s assigned-risk program. If you go through PAIP, the Plan will assign you to an insurance company that must write the mandatory coverages.Costs will be higher under this program. But for some people, it’s their only option.⁶

The best way to find cheap New Jersey auto insurance is to compare rates on similar policies across multiple competing insurance companies. Here are a few tips: 

• Compare identical coverage across at least three companies. Match the liability limits, PIP limit, deductibles, and right-to-sue option on every quote. That way, you know you’re getting an apples-to-apples comparison. 

• Get a quote from a regional insurer. NJM and other regional and mutual insurance companies are extremely competitive in New Jersey, but these carriers don’t always show up in every national comparison. Luva compares regional and national carriers in one place.

• Understand your PIP limit and right-to-sue options. Choosing the cheaper option can lower your premiums, but you are giving up important protections in the event you are injured.

• Name your health plan as primary for PIP, if it qualifies. New Jersey lets you route accident-related medical bills through your own health insurer first (other than Medicare or Medicaid) rather than your car insurance company. This reduces the PIP portion of your premium. However, a PIP deductible will still apply.²

What is the New Jersey Special Automobile Insurance Policy?

For lower-income residents, New Jersey also offers a third option: the Special Automobile Insurance Policy, or “dollar-a-day” policy. This option is open only to drivers enrolled in Federal Medicaid with hospitalization.

The cost is $360 a year, paid in full, or $365 a year, paid in two six-month installments. 

This plan pays for emergency treatment, up to $250,000 for brain and spinal-cord injuries, and includes a $10,000 death benefit. However, there is no liability, collision, or comprehensive coverage.⁷