Understanding the Risks and Rewards of State Minimum Coverage
NJ Minimum Car Insurance Coverage: Is It Enough?
Learn about New Jersey's 15/30/5 minimum car insurance requirements, who should consider it, and when paying for more coverage makes sense. Make an informed decision about your financial protection.
New Jersey Minimum Insurance Requirements
The absolute cheapest legal coverage in NJ - understand what's included and what's not
Bodily Injury
$15,000 / $30,000
Covers medical expenses for others injured in an accident you cause
Property Damage
$5,000
Covers damage to other vehicles or property in an accident you cause
PIP Coverage
$15,000
Personal Injury Protection for your medical expenses (can opt out with waiver)
Uninsured Motorist
Optional
Not required but highly recommended for protection against uninsured drivers
Important Warning
Minimum coverage does NOT include collision or comprehensive coverage. This means no coverage for your own vehicle's repairs or replacement, regardless of fault. You also have very limited protection against lawsuits.
Is Minimum Coverage Right for You?
Use our calculator to determine if minimum coverage makes sense for your financial situation, or if you need more protection.
When Minimum Coverage Makes Sense:
- Your car is worth less than $3,000
- You have minimal assets to protect
- You drive very rarely (under 2,000 miles/year)
- You cannot afford higher coverage
When You Need More Coverage:
- You own a home or have significant savings
- You have dependent children
- You commute regularly or drive frequently
- Your car is financed or leased
Compare Coverage Options and Costs
See how minimum coverage stacks up against other options
| Coverage Level | Bodily Injury | Property | PIP | Comp/Collision | Cost | Protection | Risk Level |
|---|---|---|---|---|---|---|---|
| State Minimum | 15/30K | 5K | 15K | Not included Not included | Cheapest option | Minimal | Very High |
| Basic Plus | 50/100K | 25K | 50K | Optional Optional | Affordable | Moderate | Moderate |
| Recommended | 100/300K | 50K | 100K | Included Included | Reasonable | Good | Low |
| Full Protection | 250/500K | 100K | 250K | Included Included | Higher premium | Excellent | Minimal |
Real Risks of Minimum Coverage
Understanding these risks helps you make an informed decision about your coverage
Medical Bills Exceed Coverage
A minor injury can cost $50,000+. With $15,000 coverage, you pay the rest.
Property Damage Liability
Hit a new car? Average cost is $35,000. You owe $30,000 after your $5,000 coverage.
Personal Asset Exposure
They can sue for your home, savings, and future wages if damages exceed coverage.
No Collision Coverage
Your car is totaled? You get nothing without collision coverage.
No Comprehensive Coverage
Car stolen or damaged by weather? You pay for everything.
Legal Defense Costs
Lawsuits can cost tens of thousands even if you win. Low limits mean less legal coverage.
Critical Warning
One serious accident can lead to financial ruin with minimum coverage. A single hospital stay can exceed $100,000. With only $15,000 in coverage, you're personally responsible for the remaining $85,000+.
Who Should (and Shouldn't) Choose Minimum Coverage
May Consider Minimum Coverage
Older Vehicle Owners
Car worth less than $3,000 with no loan
✓ Limited vehicle value to protect
Very Low Income
Struggling to afford any insurance
✓ Some coverage better than none
Minimal Assets
No home, savings under $5,000
✓ Limited assets at risk
Rarely Drive
Less than 2,000 miles per year
✓ Lower accident risk
Should Avoid Minimum Coverage
Homeowners
Own property or have mortgage
✗ Home equity at risk in lawsuit
Parents
Have dependent children
✗ Need to protect family's future
Commuters
Drive to work daily or high mileage
✗ Higher accident exposure
Good Credit/Assets
Savings, investments, or good income
✗ More to lose in lawsuit
Better Options Than Minimum Coverage
Small premium increases can provide significantly better protection
Best Value Coverage
Only 20-30% more than minimum but provides 3x the protection. This is our most recommended coverage level for budget-conscious drivers.
- • 3x more bodily injury coverage
- • 10x more property damage coverage
- • Better legal defense coverage
- • Still very affordable
Recommended Standard
Provides solid protection for most families. Protects your assets while keeping premiums reasonable. Best for homeowners.
- • Excellent liability protection
- • Covers most accident scenarios
- • Protects home and savings
- • Peace of mind coverage
Low Mileage Option
If you drive less than 5,000 miles per year, usage-based insurance can provide good coverage at minimum coverage prices.
- • Pay for what you use
- • Better coverage than minimum
- • Perfect for occasional drivers
- • Can save 30-50%
Get the Right Coverage at the Right Price
Whether you need minimum coverage or comprehensive protection, we'll help you find the most affordable option that meets your needs.
Minimum Coverage Questions Answered
Get clear answers about NJ minimum car insurance coverage
What exactly is NJ minimum car insurance coverage?
New Jersey minimum car insurance is 15/30/5, meaning $15,000 bodily injury per person, $30,000 per accident, and $5,000 property damage, plus $15,000 PIP (Personal Injury Protection). This is the absolute cheapest legal coverage but provides very limited financial protection.
How much cheaper is minimum coverage vs. standard coverage?
Minimum coverage is typically 40-60% cheaper than standard coverage. However, the increased financial risk often outweighs the savings. For example, saving a few hundred dollars annually could expose you to tens of thousands in uncovered damages.
Can I be sued if my minimum coverage isn't enough?
Yes, absolutely. If you cause an accident and damages exceed your coverage limits, you can be personally sued for the difference. They can go after your assets including your home, savings, investments, and even garnish future wages.
Is minimum coverage enough if I don't own a home?
Even without a home, minimum coverage is risky. Future wages can be garnished, bank accounts seized, and any future assets you acquire could be at risk. Plus, you have no coverage for your own vehicle repairs with minimum coverage.
What happens if I hit an expensive car with minimum coverage?
With only $5,000 in property damage coverage, you'd be personally liable for the rest. Hitting a $50,000 BMW means you owe $45,000 out of pocket. This could lead to lawsuits, wage garnishment, and financial ruin.
Can I add collision and comprehensive to minimum liability?
Yes, you can add collision and comprehensive coverage while keeping minimum liability limits. However, this creates an imbalanced policy - you're protecting your car but not your financial future. It's usually better to increase liability limits first.
How much more does 50/100/50 cost vs minimum?
Typically, upgrading from 15/30/5 to 50/100/50 costs an additional 20-40% in premiums. For most drivers, this means paying slightly more per month for significantly better protection - often the best value in insurance.
Do lenders accept minimum coverage for financed cars?
No, if you have a car loan or lease, lenders require comprehensive and collision coverage in addition to higher liability limits. Minimum coverage is only an option for vehicles you own outright.