Best Car Insurance in New Jersey

Yes, New Jersey is a no-fault state, which means that each driver's insurance pays for their own medical bills after an accident, regardless of fault. To pay for these expenses, drivers in New Jersey are typically required to carry $15,000 in personal injury protection (PIP) per person and per accident.

New Jersey is also one of three “choice no-fault” states that allow drivers to opt out of the no-fault system, which would mean no limitations when it comes to filing a lawsuit after a wreck. If a driver does not opt out, they can only sue the at-fault driver if they have experienced the loss of a body part, significant disfigurement or scarring, a displaced fracture, loss of fetus, permanent injury, or death.

How Fault Affects Lawsuits in New Jersey

 When a driver files a lawsuit against an at-fault party, even in no-fault legal systems, the state's laws will affect how compensation is awarded. Specifically, New Jersey has modified comparative negligence laws.

• If you are 51% or more at fault, you can't collect any damages from the other driver.
• If you are less than 50% at fault, you can collect damages minus the percentage that you're at fault.

For example, if you're 30% at-fault, you can get 70% of your damages covered by the other driver. In New Jersey, the statute of limitations is fairly short: just two years. That means you have two years after your accident to file a lawsuit for medical damages. 

Why You Should Care That New Jersey is a Tort/Fault State 

No-fault means faster payouts. Police and your insurance company don't need to investigate the accident's cause before you can get paid for your medical bills. As a result, your bills get paid more quickly than they would in a tort state, where fault for the accident determines the payout.

Another benefit of no-fault insurance is the knowledge that you're covered no matter who causes an accident. That can make driving in New Jersey a bit less nerve-wracking.

No-fault insurance also has downsides, unfortunately. The most obvious is higher premiums. States with no-fault insurance struggle with high rates of fraudulent claims, which raise the costs of insurance for everyone.

No-fault rules don't apply to property damage, either. One or both drivers will be at fault after a collision, no matter which state you live in. The police and your insurance company consider New Jersey's laws, the circumstances of the collision, and drivers' testimonies before deciding who is at fault.

New Jersey vs. Other No-Fault States

Insurance companies in New Jersey have between 40 and 100 days to settle a claim after it is filed, depending on the type of claim. For all claims, insurers have 10 working days to acknowledge the claim and send the necessary paperwork.

Timeframes for Settling Insurance Claims in New Jersey  

• All claims: 10 business days to acknowledge the claim
• First-party claims: 30 days to investigate and make a payment
• Third-party property damage claims: 45 days to investigate and make a payment
• Third-party bodily injury claims: 90 days to investigate and make a payment

There are several factors that can affect exactly how long it takes for an insurance company to settle a claim. For example, claims involving serious or multiple injuries take longer to settle. Additionally, poor communication between the driver, insurance company, and insurance adjuster can slow down the process.

Still, you are entitled to an efficient settlement. If you think that your insurance company is violating the law or operating unethically, you can file a “bad faith” lawsuit, which may award you the original settlement amount with added interest and penalties.

No, you do not need uninsured motorist property damage insurance in New Jersey – it is optional. Drivers can choose to purchase at least $5,000 in uninsured motorist property damage (UMPD) coverage per accident, or they can go without the coverage.

Even though it's not required, UMPD is a good investment for drivers who want to avoid paying out of pocket to fix their car after an accident caused by an uninsured motorist. But UMPD is similar to collision insurance, which pays to fix your car after any accident you're in. So, if you already have collision coverage, you do not need UMPD.

To learn more, check out WalletHub's guide to uninsured motorist insurance.

No, you cannot insure a car with a salvage title in New Jersey. Salvage vehicles are cars that have been declared a total loss, meaning they're too damaged to be worth repairing and cannot be driven legally. As a result, no legitimate car insurance company writes policies for them.

Although insurance companies in New Jersey won't insure a car with a current salvage title, you can get coverage if you have the vehicle repaired and inspected by a state-certified mechanic. If it's declared safe to drive, the DMV will issue the car a salvage/rebuilt title. Several insurance companies, including Allstate and Geico, sell policies to vehicles with a salvage/rebuilt title.

Keep in mind that some insurers will only sell liability insurance for salvage/rebuilt cars, meaning that they won't pay for any physical damage to the vehicle. Even if you are able to get collision and comprehensive insurance, your policy may not cover the full value of the car if it's totaled again.

You can get car insurance discounts in New Jersey based on how you drive, the car you own, and your relationship with your insurance company. In New Jersey, car insurance companies are allowed to consider factors like employment, residential, and marital status when setting premiums. That means there are also discounts available for being married, owning a home, or being affiliated with certain employers or educational institutions.

Almost anyone can get a discount on car insurance in New Jersey because most insurance companies make it easy to qualify for a variety of savings. New Jersey insurers typically offer discounts that fall into one of three categories—policy discounts, driver discounts, and vehicle discounts.

Policy discounts typically reward customer behavior that is desirable to the insurance company. For example, most New Jersey drivers can save by registering for paperless billing or getting both home and auto policies from the same company. Driver discounts are available to New Jersey residents who are lower-risk to insure, like those with clean driving records. And vehicle discounts help drivers save if their car has certain safety features or anti-theft systems.

Car Insurance Discounts in New Jersey

Remember, discounts vary among different insurance companies, so it's always best to contact the provider directly to determine which discounts you qualify for.