New Jersey Car Insurance Rates and How They Are Set

New Jersey car insurance rates are set by each insurance company, but a company cannot simply start charging a new rate. The New Jersey Department of Banking and Insurance (DOBI) says an insurer must file its rating system with the department before using or applying any rate, and must file any changes to its rates or rating system ¹. When the state raised its minimum coverage limits for 2026, DOBI told auto insurers they had to have approved rates on file for the new limits ².

New Jersey's price for a policy also depends heavily on choices the driver makes. The state offers a Standard Policy and a lower-cost Basic Policy, and on the Standard Policy each driver chooses between two lawsuit options that affect the premium ^{4 5}. Those choices, along with the higher liability minimums that took effect on January 1, 2026, are covered below. Our guide to why car insurance goes up covers the personal reasons a renewal can change.

DOBI's Bulletin No. 23-08, issued December 29, 2023 to private passenger auto insurers, sets out the filing rules in plain terms. Under N.J.S.A. 17:29A-6, an insurer must file its rating system with the department before using or applying any rate. Under N.J.S.A. 17:29A-14, it must file alterations, supplements or amendments to its rates or rating systems, and it should be applying the rates it has on file ¹. The same bulletin notes that under N.J.S.A. 17:22-6.14a1, a private passenger auto insurer's underwriting guidelines may not be arbitrary, capricious or unfairly discriminatory ¹.

The 2026 change to minimum limits shows how this works in practice. In Bulletin No. 25-06, dated July 31, 2025, DOBI said all insurers issuing auto policies in New Jersey must have approved rates on file for the new minimum limits, and asked private passenger auto insurers that needed to file rates to do so by September 1, 2025 ². Our explainer on what a rate filing is covers what such filings contain.

DOBI publishes consumer guidance on how New Jersey auto insurers may use credit-based insurance scores. According to that guidance, insurers that use scoring must tell policyholders, may not use the score as the only factor in setting rates, and must submit their scoring model to the department ⁷. The guidance says New Jersey scoring models cannot consider race, ethnicity, sex, age, religion, income or address, and that insurers may not use scoring for Basic Policy or Dollar-a-Day customers ⁷. DOBI also says insurers must provide exceptions when credit has been affected by extraordinary life events such as catastrophic illness or injury, the death of a spouse, child or parent, temporary loss of employment, divorce or identity theft ⁷.

P.L.2022, c.87 raised New Jersey's minimum auto liability limits in two steps ³. For a Standard Policy issued or renewed on or after January 1, 2026, the law requires at least $35,000 of bodily injury coverage for one person and $70,000 for more than one person in any one accident; the earlier step, from January 1, 2023, had set those amounts at $25,000 and $50,000 ³. DOBI's Bulletin No. 25-06 confirms that the property damage minimum remains $25,000, and that the increases do not apply to the Basic Policy ². When a renewal would no longer meet the new minimums, the law requires the insurer to notify the policyholder that the limits have been increased ².

New Jersey policies also include personal injury protection (PIP), which DOBI describes as medical coverage for you and others on your policy that pays no matter who caused the accident ⁶. On the Standard Policy, PIP can be bought from $15,000 up to $250,000 or more, and DOBI's buyer's guide says most drivers choose $250,000 ⁶. Our comparison of minimum and full coverage prices explains why the lowest limits are not always the right fit.

DOBI describes the Basic Policy as usually costing significantly less than a Standard Policy while providing limited benefits ⁴. Under the Basic Policy, property damage liability is $5,000 per accident and PIP is $15,000 per person, per accident, with up to $250,000 for certain serious injuries; bodily injury liability is not included but $10,000 is available as an option ⁴. DOBI says the Basic Policy includes the Limited Right to Sue option ⁵.

On the Standard Policy, each driver must choose a lawsuit option ⁴:

• Unlimited Right to Sue (No Limitation on Lawsuit). You keep the right to sue the at-fault driver for pain and suffering for any injury ⁴.
• Limited Right to Sue (Limitation on Lawsuit). You agree not to sue for pain and suffering unless the injury is one of the permanent injuries the law lists, such as loss of a body part, significant disfigurement, a displaced fracture or a permanent injury ⁴.

DOBI says this choice affects how much the insurance costs and applies to the policyholder and relatives living in the household who are not covered by another auto policy ⁴. It does not affect medical expenses paid by PIP or the right to sue for economic losses ⁴. DOBI also says the Limited Right to Sue option is imposed by law when no choice is made on the coverage selection form ⁴.

A filed rate change is an average across a company's existing policyholders. A renewal can also change because of the 2026 minimum limits, a new driver, a ticket or at-fault accident, a discount that ended, or a different PIP, deductible or lawsuit choice. Our guide to reading a renewal notice shows where those reasons usually appear. Asking the insurer or agent which factors changed is a reasonable first step, and you can compare quotes from several insurers to see whether a price is in line with others.

Sponsored link. QuotePitStop is a lead-generation service and is paid by insurance partners when you request quotes.

DOBI's Consumer Inquiry and Response Center takes questions and formal complaints. The department lists 609-292-7272 and a consumer hotline at 1-800-446-7467, answered from 8:30 a.m. to 5:00 p.m. Eastern time, Monday through Friday, and says filing online is the most convenient way to reach it ⁸.

For a question about a specific claim, start with your insurer and then DOBI; we do not give claims advice. QuotePitStop is a lead-generation service, not an insurance company, agent or broker.

• ¹ Official record: DOBI Bulletin No. 23-08 (December 29, 2023), the requirement to file rating systems before use and to file rate changes, and underwriting guideline standards, checked October 13, 2026.
• ² Official record: DOBI Bulletin No. 25-06 (July 31, 2025), approved rates for the new minimums, the September 1, 2025 filing request, the $25,000 property damage minimum, the Basic Policy exclusion and renewal notices, checked October 13, 2026.
• ³ Official record: P.L.2022, c.87, the $25,000 and $50,000 limits from January 1, 2023 and the $35,000 and $70,000 limits from January 1, 2026, checked October 13, 2026.
• ⁴ Official record: DOBI's Standard Policy page, the Standard and Basic coverage comparison including the $5,000, $10,000 and $15,000 Basic amounts and the $250,000 PIP maximum for certain injuries, and the right-to-sue options, checked October 13, 2026.
• ⁵ Official record: DOBI's Basic Policy page, that the Basic Policy includes the Limited Right to Sue option, checked October 13, 2026.
• ⁶ Official record: DOBI's New Jersey Auto Insurance Buyer's Guide (2026 edition), the PIP description, the $15,000 to $250,000 PIP range and the most common choice of $250,000, checked October 13, 2026.
• ⁷ Official record: DOBI's undated consumer publication on insurance scoring in New Jersey, the disclosure, model filing, prohibited factors and life-event exceptions, checked October 13, 2026.
• ⁸ Official record: DOBI's consumer assistance page, phone numbers and hours, checked October 13, 2026.