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Mandatory Auto Insurance in New Jersey

As a licensed driver, you already know that New Jersey law requires you to carry auto insurance, but what specific coverages do you need to have in place? Let’s break down the details of state minimum limits mandated for each motorist, and other lines of coverage you may be required to have on your policy even if they’re not required by state law. In addition to the state, two entities that may also enforce mandatory auto insurance include financial institutions (such as lenders) and auto dealers. There are varying requirements, depending on your situation and it’s important to know what coverage you need and why.

Auto insurance required in New Jersey

Most states, including New Jersey, require drivers to have auto insurance. New Jersey has mandated minimum limits for certain auto insurance coverages including liability coverage, which protects you when you’re involved in a car accident that you caused, resulting in bodily injury or property damage to others. The following is a detailed breakdown of each line of protection and the minimum limits that are required by the state of New Jersey:

  • Liability for Bodily Injury: $15,000 per person and $30,000 per accident.
  • Liability for Property Damage: $5,000 per accident.
  • Personal Injury Protection: $15,000 per person.
  • Uninsured Motorist Bodily Injury: $15,000 per person and $30,000 per accident.
  • Uninsured Motorist Property Damage: $5,000 per accident.

What happens if you drive without insurance?

The Garden State considers driving without insurance a serious offense. Even for a first-time offender, the statutory penalties include a one-year driving suspension, a stiff fine of $300-$1,000, and community service for a length of time at the court’s discretion. On top of that, your vehicle may be impounded if you cannot show proof of insurance within a period of 24 hours. The cost of breaking the law is certainly higher than following it. It’s important to remember that you will be subject to the same consequences of breaking the law if you allow someone else to drive your car if it isn’t insured. If you currently do not have car insurance, this is something you need to get in place today!  

Other situations that require mandatory auto insurance

The state is not the only entity that requires certain types of coverage on your auto insurance policy. Beyond carrying the minimum limits for liability auto insurance required in New Jersey, there may be a few other times when you experience mandatory auto insurance requirements.

If you own your vehicle, you have much more flexibility in terms of choosing the types of auto insurance that you include on your policy. However, if you financed the purchase of a car or you plan to finance a future vehicle purchase, your lender will most likely require you to carry both comprehensive and collision coverage on your auto policy. Also, if you are leasing, or plan to lease a vehicle from an auto dealer, the dealership will probably require you to carry comprehensive and collision coverage on your insurance policy. The reason for mandated auto insurance policies from lenders and dealers is strictly financial: both have a vested interest in protecting the vehicle you’re driving because, technically speaking, it’s their property.   

Final thoughts on mandatory auto insurance

It’s important to remember that required auto insurance is for the benefit of all: motorists, passengers, pedestrians, and anyone else who makes use of New Jersey thoroughfares. The state-imposed requirements are the law and must be followed. If you are looking to meet the mandatory auto insurance requirements imposed by the state, your lender or auto dealer, consider Plymouth Rock Assurance. Plymouth Rock works with a variety of lenders and auto dealerships and offers exceptional value for auto insurance in New Jersey. If you have questions about auto coverage, call Plymouth Rock today to speak with a friendly, knowledgeable representative.   

You can also read more about the importance of having insurance, what impacts insurance rates, and some tips to help you save money on your policy.

Call 855-993-4470, get your free quote online or find a local agent to see how Plymouth Rock Assurance can help you manage your coverage options and ensure you meet the mandatory auto insurance requirements, and more. If you need additional information, please visit our Contact Us page.