For drivers who may not currently have insurance, due to an inability to afford standard coverage, the reforms authorized the creation of a new basic auto insurance policy. This is a low-cost policy with minimum coverage that will meet mandatory insurance requirements. It has a $15,000 personal injury protection (PIP) medical expense limit, although treatment of certain extremely serious injuries and costs for hospital care of other significant injuries is covered up to $250,000. Other PIP benefits, such as income continuation and essential services, are not offered under the basic policy. Bodily injury liability coverage is also not included, although $10,000 in coverage is available as an option at additional cost. The policy provides a maximum property damage coverage of $5,000 and the "Limitation on Lawsuit Threshold" is mandatory for the basic policy.

The State of New jersey Basic Policy was established pursuant to N.J.S.A. 39:6A-3.1 as a lower-cost

alternative to standard coverage for drivers for whom: a.) standard coverage may be cost

prohibitive; b.) standard coverage limits may be excessive given personal circumstances; or c.)

driving uninsured in violation of N.J.S.A. 39:6A-3 may be contemplated as an alternative to

standard coverage. To date, very few drivers for whom the Basic Policy appears suitable have

taken advantage of the option. The Department is concerned that the negligible number of Basic

Policies now in force (less than 0.22% of all policies in force) indicates that many drivers who

could consider the option have not done so because they and producers lack accurate

information. New Jersey has uninsured drivers who by driving uninsured

are putting themselves and others at substantial risk. Drivers who elect the Basic Policy as an

alternative to driving uninsured benefit both themselves and the general public. The following

provides accurate information about the Basic Policy process for producers, applicants and

prospective applicants.

1. Any owner of an automobile registered or principally garaged in New Jersey may elect to

meet minimum mandatory insurance requirements with the Basic Policy. Owners of automobiles

requiring collision coverage because of lease or financing terms for the vehicle may elect to add

those coverages to the Basic Policy, with all unaffected coverages remaining as set forth in

N.J.S.A. 39:6A-3.1, in cases where the insurer offers such an option.

2. NJ Insurance Companies and Nj Auto Insurance Agents in the voluntary market are required by law to offer coverage,

including but not limited to the Basic Policy, to any eligible person who asks for coverage,

except where the Department has exempted the insurer from eligible-persons requirements, or if the take all comers rule expiring would eliminate the applicant from coverage..

3. Drivers who elect the NJ Auto Insurance Basic Policy as an alternative to driving uninsured gain several

protections, as set forth in N.J.S.A. 39:6A-3.1, as well as a right to sue. Uninsured drivers do not

have a right to sue for damages relating to the operation of their vehicle.

4. A properly completed and executed coverage selection form, including all coverages

provided by the Basic Policy, is prima facie evidence of the insured's knowing election or

rejection of any coverage option.

5. N.J.S.A. 39:36A-23 immunizes insurers from liability for damages relating to the levels

of coverage elected or rejected by a driver in a properly completed and executed coverage

selection form. Furthermore, N.J.S.A. 17:28-1.9 specifically provides the same immunity for

NJ Insurance Agents or producers.

6. All applicants and prospective applicants must be informed of the existence and terms of

the Basic Policy, and provided with the opportunity to select the policy.

Claims information for New Jersey Insured's

What do you get in NJ Basic and NJ Standard Auto Insurance Policies?

Bodily Injury Liability (Coverage for claims by people injured as a result of an accident you cause)

NJ Car Insurance: Basic Policy: Coverage is not included but $10,000 coverage for all persons, per accident, is available as an option.

NJ Car Insurance: Standard Policy: Coverage of $15,000 per person, per accident and $30,000 for all persons, per accident, is provided but higher limits are available.

Property Damage Liability (Coverage for claims by people whose property is damaged as a result of an accident you cause)

NJ Car Insurance: Basic Policy: Coverage of $5,000 per accident is provided.

NJ Car Insurance: Standard Policy: Coverage of $5,000 per accident is provided but higher limits are available.

Personal Injury Protection (Coverage for injuries sustained in an automobile accident by you or other persons covered under your policy)

NJ Car Insurance: Basic Policy: Coverage of $15,000 per person, per accident, and up to $250,000 for permanent or significant injury as defined in the policy.

NJ Car Insurance: Standard Policy: Coverage of $250,000 per person, per accident, unless a lower limit is selected. However, up to $250,000 for permanent or significant injury as defined in the policy regardless of selected limit.

Uninsured/Underinsured Motorist Coverage (Coverage protects you if you are in an accident with someone who does not have the minimum coverage required by law or is insured with limits less than your uninsured motorist limits)

NJ Car Insurance: Basic Policy: None

NJ Car Insurance: Standard Policy: Coverage is available in amounts similar to liability coverage.

Collision (Coverage for damage to your automobile from striking another vehicle or fixed object)

NJ Car Insurance: Basic Policy: Available as an option

NJ Car Insurance: Standard Policy: Available as an option

Comprehensive (Coverage for damage to your automobile caused by other than a collision)

NJ Car Insurance: Basic Policy: Available as an option

NJ Car Insurance: Standard Policy: Available as an option

Auto Insurance New Jersey Basic Policy