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New Jersey Car Insurance: Better Have it

Written by Todd Clay. Posted in Research Last Updated: 12/02/2017

To protect your right to go to court you have to carry some form of New Jersey car insurance.

State Regulator Information 800-446-7467
Insurance Premium Avg. Annual Premium: $ 1,375 National Average: $1,318
Mandatory Car Insurance Coverage PIP:$15k
Property Damage Liability: $5k
New Jersey Car Insurance

The level of insurance you purchase in New Jersey determines your right to sue.

New Jersey car insurance has a little something for everyone. They offer multiple levels of coverage so that all drivers can obtain some form of insurance coverage. From the coverage available on a standard New Jersey car insurance policy that most people buy to coverage on a SAIP policy for people on Medicaid.

Required Minimum NJ Car Insurance Coverage

The basic New Jersey car insurance coverage provides the very minimal insurance coverage that a driver can get away with carrying and still legally drive in that state. The plan was put together so that people could afford to buy the insurance required to drive. The coverage provided on the basic New Jersey car insurance policy is the required personal injury protection of $15,000 per person and $5,000 for liability property damages.

New Jersey Special Automobile Insurance Policy (SAIP)

New Jersey car insurance has a special policy for those that have low incomes that would normally have trouble purchasing insurance to be able to drive. This SAIP policy is only for those whose income qualifies them for Medicaid (with hospitalization coverage) and provides insurance to them at a discounted amount.

This special New Jersey car insurance coverage only covers medical related expenses resulting from an accident. It offers no protection to any damages that you may cause to the other person’s property or to your own.

No Right to Sue

One of the biggest arguments that people use for not having insurance is that they are safe drivers and don’t need it. They reason that if they get into an accident that it will be the other person’s fault and that they can sue them for damages.

New Jersey car insurance law has very effectively taken care of this excuse not to carry insurance. The law states that if you don’t have the required insurance coverage that you cannot sue the other party that may be at-fault for an accident you are in. To obtain this right back, you don’t need to carry comprehensive and collision coverage on your vehicle you just have to be carrying the minimum New Jersey car insurance that the state requirements.

Right To Sue

New Jersey car insurance offers two options in regards to having the right to sue the other party for pain and suffering after a car accident. If you purchase a standard New Jersey car insurance policy, one with higher limits than the basic New Jersey car insurance policy, you are given the option of choosing the cheaper “Limited Right to Sue” and the more expensive “Unlimited Right to Sue”.

Under the “Unlimited Right to Sue” you can take the other party to court for any injury that they may have caused you in an accident. Under the “Limited Right to Sue” option you can only take the other person to court for certain injuries that resulted from the accident that they caused.

These injuries include:

• Losing a body part

• Loss of an unborn baby

• Disfigurement or scaring that is significant

• Displaced Fracture

• Any injury considered permanent

• Death

(New Jersey Department of Banking and Insurance)

If you have any questions, please talk to your agent about the level of New Jersey car insurance that you need to adequately protect yourself.

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Todd Clay

Todd Clay is a former insurance agent with the largest insurance company in the United States. He earned his Bachelor’s from the University of Texas. He's worked in several fields but has specialized in insurance, financial-related information, and technology. He blogs at Car Insurance Guidebook. Connect with Tood on Google+

Reviews (2)

  • ashley


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    I have nj saip auto insurance and have been told that if I am in an accident that I am not at fault for I cannot sue is this true or rumor please help me to better understand thanks 🙂


    • Michele Wilmonen


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      This is definitely something you need to talk to your insurance agent about. A SAIP (Special Automobile Insurance Policy) is a special medical coverage policy and may have different rules and regulations than regular insurance policies.

      With regular insurance policies, the state of New Jersey is a comparative negligence state, meaning that each driver is assigned a determined amount of fault for an accident. With comparative negligence states there usually is no ban on lawsuits.


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