Uninsured Motorist Coverage in New Jersey: Do You Need It?
New Jersey requires drivers to hold a certain amount of uninsured motorist coverage—here’s how that will benefit you.
Written by Jacqulyn Graber
Reviewed by Kathleen Flear
New Jersey
requires all drivers to hold a car insurance policy that includes at least $25,000 of uninsured motorist coverage per person and $50,000 per accident.Like most states,
New Jersey requires
drivers to hold a certain level of liability insurance
and personal injury protection (PIP)
coverage—but the state takes it a step further by also requiring uninsured motorist coverage to protect drivers from those who lack sufficient coverage.RECOMMENDED
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Do you need uninsured motorist coverage in New Jersey?
Yes—
uninsured motorist coverage
(UM) is legally required in the Garden State. All drivers must have a car insurance policy that includes $25,000 or more of UM coverage per person and $50,000 or more per accident. These requirements do make your car insurance premiums a bit more expensive, but they are intended to protect your wallet in the long run. According to the
Insurance Information Institute (III)
, approximately 3.1% of all drivers in New Jersey are uninsured. This is a relatively small number (in fact, New Jersey has one of the lowest percentages of uninsured drivers compared to all U.S. states), but it still means that tens of thousands of NJ drivers lack coverage. Add in drivers who lack enough coverage to pay for more expensive accidents, and you’re left with a significant number of people whose insurance won’t cover the cost of significant damages after an accident.
Uninsured/underinsured motorist (UM/UIM) coverage works to supplement the driver’s liability insurance (and your own personal injury protection coverage), covering key medical expenses resulting from a collision.
While UM coverage is mandatory, UIM coverage is completely optional—however, it’s relatively cheap to add to your policy, thanks to New Jersey’s impressively low percentage of uninsured drivers.
How uninsured motorist insurance works in New Jersey
As we mentioned above, all New Jersey drivers must hold specified levels of
property damage liability
and bodily injury liability
insurance, as well as personal injury protection (PIP). Liability insurance pays for other drivers’ repairs if you’re at fault in an accident, while PIP supplements your health insurance to cover your medical bills. The required UM coverage—as well as optional UIM coverage—kicks in if you’re in an accident with an underinsured driver who lacks sufficient liability/PIP coverage to pay for your medical bills.
What’s available
Even though your basic, limited policy will include at least $25,000/$50,000 of UM coverage, you can purchase more if you deem it necessary.
You may choose to purchase higher levels of:
- Uninsured motorist bodily injury coverage (UM/UMBI), which covers your medical expenses (and those of your passengers) after an accident with an uninsured driver
- Underinsured motorist bodily injury coverage (UIM/UIMBI), which covers your medical expenses if the other driver’s liability insurance isn’t sufficient to cover your costs
Although neither UMBI nor UIMBI is required by state law, this supplemental coverage is widely available as an add-on.
What it covers
UM coverage pays for anticipated medical expenses like ER bills and any immediately necessary surgeries. But the coverage doesn’t stop there! It also includes:
- Future medical expenses
- Lost wages
- Long-term rehabilitative or nursing care
- Medical devices such as wheelchairs
- Retrofitting your house to accommodate a disability caused by the accident
- Services such as yard work or cleaning that you’re no longer able to do
- Pain and suffering (under certain circumstances)
Plus, optional UIM coverage will pay for non-economic losses. Non-economic losses include pain and suffering, loss of enjoyment of life, emotional trauma, and other losses that are harder to quantify than medical bills or lost wages.
How to make a claim
As you’re likely already aware, one of the first steps to take
after a car accident
is to exchange personal and insurance information with all of the other parties involved.If you discover that another driver lacks bodily injury insurance (or insurance, in general), and you or one of your passengers is injured, you’ll need to file a UM/UIM claim with your insurance company.
Doing so should be relatively straightforward. You can call your insurance company and ask to speak to a claims representative. They’ll ask you about the details of your accident, as well as any relevant documentation, including medical records, traffic crash reports, hospital bills, and more. Often, these documents can be uploaded as they’re received via your insurance provider’s website or mobile app.
Keep in mind that if your medical costs exceed the limit on your UM coverage, the remaining balance will have to be covered via your health insurance, PIP coverage, and your own pocket.
Why it’s a good idea to buy uninsured motorist insurance in New Jersey
The main reason to purchase uninsured motorist coverage is that it’s legally required as part of New Jersey's car insurance laws.
However, we’re here to tell you that this coverage is definitely a good investment. Here’s why:
Healthcare in New Jersey is expensive
New Jerseyans pay the fifth-highest health care costs when comparing medical expenses state-by-state. This means that there’s a good chance that your health insurance policy—if you have one—lacks enough coverage to pay for some of the most serious accidents, especially if you or your passenger sustains a long-term injury.
MORE:
New Jersey DUI Laws
New Jersey hit-and-run accidents are on the rise
Over the last several years, the amount of hit-and-run accidents occurring in New Jersey has been increasing. A hit-and-run is an accident where the at-fault driver flees the scene, meaning you won’t be able to file a claim with the at-fault driver’s insurance—even if you
report the hit-and-run
to the police. And if you only have liability insurance, it’s likely that your insurer will not cover the damage from a hit-and-run. UM/UIM insurance helps protect drivers against hit-and-run accidents, kicking in when you’re not able to track down the other driver to make a claim against their insurance policy.
Over 3% of New York drivers are uninsured
Once again, 3% might not sound like a large number—but note that New Jersey is also the most densely-populated state in the nation. This means the roads are crowded, and you’re more likely to encounter an uninsured driver on your regular commute.
How to save on uninsured motorist coverage in New Jersey
Don’t worry—adding uninsured/underinsured motorist coverage doesn’t have to make your rates skyrocket.
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