Rock Talk

What is the NJ PLIGA Fee on Your Bill?

Last updated on November 12, 2019 at 08:57 am

If you’ve looked over your New Jersey auto insurance bill, you’ve probably seen that line item marked NJ PLIGA fee. Here’s an easy answer to what is the NJ PLIGA fee and how it works for all insured drivers in the state.

Imagine that your colleague Mary has not yet switched her insurance coverage to Plymouth Rock Assurance, and her carrier goes bankrupt tomorrow. Through no fault of her own, she is left without the coverage she purchased.

The New Jersey Property-Liability Insurance Guaranty Association (NJ PLIGA), which was created by state law in 1974, is Mary’s safety net in this situation. The Association covers policyholders and claimants of insolvent property-casualty insurance companies by making sure they receive statutory benefits. 

All car insurance companies in New Jersey are required by the state to be members of this association and collect funds for its operations. The NJ PLIGA fee on your bill supplies a pool of money to pay claims (to policyholders and claimants) in the event an insurance company becomes insolvent.

It’s important to know that uinsured/underinsured motorist coverage is different than what the NJ PLIGA provides. Uninsured/underinsured (often abbreviated UM/UIM) coverage pays for property damage, lost wages and bodily injuries that the insured person and occupants of the insured vehicle sustain, if caused by a driver or owner of a vehicle who has no insurance (or does not have enough insurance) and is legally liable for an accident.

The uninsured or underinsured liable driver receives no benefit from the victim’s uninsured/underinsured coverage. However, if the liable driver is uninsured due to his/her insurance company becoming insolvent, NJ PLIGA kicks in.

13 thoughts on “What is the NJ PLIGA Fee on Your Bill?

  1. Is this just anither way for someone to get richer. Who retains control of money collected by this fee? and who gets the interest on above money. Sounds like another “GOT YOU” just an empty black hole with no one remembering what is was started for!!!

    How many insurance companies have been put out of business thus requiring a bailout?

  2. I just want to know why? my Insurance premiums go up every year with NOT having One accident ??? Can someone tell me why?

    1. George, thank you for your question. Insurance premiums are based on a wide variety of factors. If you are a policyholder with Plymouth Rock, please give us a call to discuss your coverage options and make sure you are taking advantage of all the discounts available to you.
      You may also be interested in reading about a growing insurance fraud and medical abuse epidemic that has forced nearly all NJ insurance companies to increase rates over the last year and a half.

  3. Barbara, Steve, and “Aa,” thank you for your comments. We completely understand the skepticism given the plethora of news about corporate greed and corruption popping up every day.

    The New Jersey Property-Liability Insurance Guaranty Association is a private, non-profit, unincorporated legal entity established pursuant to the New Jersey Property-Liability Insurance Guaranty Association Act.

  4. Mary, thank you for your question. Uninsured/underinsured motorist coverage is a bit different than NJ PLIGA.
    Uninsured/underinsured coverage pays for property damage, lost wages and bodily injuries that the insured person and occupants of the insured vehicle sustain, if caused by a driver or owner of a vehicle who has no insurance (or does not have enough insurance) and is legally liable for an accident. The uninsured or underinsured liable driver receives no benefit from the victim’s uninsured/underinsured coverage.

    However, if the liable driver is uninsured due to his/her insurance company becoming insolvent, NJ PLIGA kicks in. NJ PLIGA is the liable driver’s safety net in this situation.

    It’s important to us that our policyholders fully understand their coverage options. If you’d like additional information, please don’t hesitate to call us.

  5. Hello There. I found your blog using msn. This is a very smartly written article. I will make sure to bookmark it and come back to read extra of your helpful information. Thanks for the post. I’ll definitely return.

  6. Did some research….lot of mumbo jumbo
    looks like this surcharge is nothing more than a payment on a insurance policy for the insurance companys, Which they of coarse refuse to pay and just cleverly decided to tack it on our bill as a SURCHARGE….and figured what the heck they pay it or they wont be insured ! they claim there were 71 companys that went insolvent, Wonder how many just moved out of state.
    In the mean time im paying $44.00 a year on that policy …..love it ,just love it….lol

  7. If you are a good driver without any traffic accident or violation and still your insurance premimum is going up every year then join the Geico. However they also collect the same PLIGA Fee but Geico seems to be good for the premium. i am with geico since last 8 years.

    1. 1. GEICO is not different. My car insurance keeps going up every year without me filing any claims or having any tickets or accidents. I am retired, 70 + and barely drive 5000 miles annually. It went up again $30.00 this year, in addition to PLIGA ($697.00 for 6 months). I am paying more money now for my 5 year-old Camry than when it was new. 2. My home insurance also went up, the same amount. Never filed any claim. PLIGA should be paid by the insurance companies.3. Government by the people, for the people? A joke.

  8. Thought I’d never say this – but I’m starting to really HATE NEW JERSEY – my once beloved home state. Every opportunity is taken by the government and it’s imps to dig deeper and deeper into the pockets of the citizens. It’s sickening and quite disgusting. Can’t wait until I’m able to move.

  9. Hi there! Thanks for taking the time to comment and bringing that link to our attention. Occasionally when outside websites do updates, their links change.

    Michael Buck

  10. Imagine if every business did that?! I’m self-employed in the travel industry, and wonder how my clients would react to a “safety net” fee every time they book a trip, in the event my business becomes insolvent?! Just another way for the state of NJ to suck the blood out of its “donors!” Now we insure the insurers! ????

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