New Jersey Motor Vehicle Accident Laws

Insurance Requirements in New Jersey

System type

New Jersey follows a no-fault insurance system, meaning that after an accident, each driver’s own insurance policy is responsible for covering their medical expenses and certain other losses, regardless of who caused the accident. This is done through Personal Injury Protection (PIP) coverage, which all drivers must carry. However, New Jersey also allows drivers to choose between a limited right to sue and an unlimited right to sue, which affects their ability to seek compensation beyond insurance payouts.

Minimum coverage requirements

New Jersey law requires all registered vehicles to carry minimum insurance coverage to ensure financial protection in the event of an accident. The required minimums include:

• Bodily injury liability: $15,000 per person and $30,000 per accident. This covers medical expenses and related costs for others injured in an accident you caused
• Property damage liability: $5,000 per accident. This covers damages to another person’s vehicle or property if you’re at fault
• Personal injury protection (PIP): A minimum of $15,000 per person, per accident, for medical expenses, with coverage extending up to $250,000 for catastrophic injuries such as spinal cord damage, brain injuries, or disfigurement

Drivers can also purchase Standard Policies, which provide higher coverage limits, or Basic Policies, which meet the bare minimum but offer significantly less protection.

Optional coverages

While the state-mandated minimums provide baseline coverage, drivers often opt for additional protection to cover various accident-related expenses:

• Collision coverage: Covers damage to your own vehicle, regardless of who was at fault
• Comprehensive coverage: Covers non-collision-related damage, including theft, vandalism, or weather-related damage
• Uninsured/Underinsured Motorist (UM/UIM) coverage: Protects you if the at-fault driver lacks adequate insurance
• Medical Payments (MedPay): Supplements PIP by covering medical bills, regardless of fault
• Gap insurance: Covers the difference between your car’s actual value and the remaining balance on your loan or lease if your car is totaled
• Rental reimbursement: Pays for a rental car while your vehicle is being repaired due to a covered accident

Penalties for non-compliance

New Jersey takes uninsured driving seriously. Driving without insurance can result in severe penalties, including:

• First offense: A fine of up to $1,000, mandatory community service, and a one-year driver’s license suspension
• Subsequent offenses: A fine of up to $5,000, possible jail time of up to 14 days, and a mandatory two-year license suspension
• Reinstatement fees: To restore driving privileges, drivers must provide proof of insurance and pay a restoration fee

Fault Laws in New Jersey

Comparative negligence system

New Jersey follows a modified comparative negligence rule, meaning that accident victims can recover damages only if they are 50% or less at fault. If they are found to be more than 50% at fault, they are barred from receiving compensation. Additionally, the amount they can recover is reduced by their percentage of fault.

For example, if a court awards a victim $50,000 in damages but determines they were 20% at fault, their compensation will be reduced by 20%, resulting in a final payout of $40,000.

Limited vs. unlimited right to sue

New Jersey is unique in that it allows drivers to choose their rights to sue when purchasing insurance:

• Limited right to sue: This option restricts your ability to sue for pain and suffering unless you suffer a serious injury, such as dismemberment, significant scarring, permanent disability, or death
• Unlimited right to sue: This allows accident victims to sue for pain and suffering regardless of the severity of their injuries

Choosing limited right to sue typically results in lower insurance premiums, but it significantly limits the ability to seek compensation for non-economic damages.

Statute of Limitations

Time limits for filing claims

New Jersey imposes strict deadlines for filing accident-related claims:

• Personal injury lawsuits: Victims have two years from the accident date to file a claim
• Property damage claims: Vehicle or property owners have six years to file for damage recovery
• Wrongful death claims: If a car accident results in a fatality, surviving family members have two years from the date of death to file a lawsuit

Exceptions to the statute of limitations

While New Jersey generally enforces strict deadlines for filing personal injury and property damage claims after a motor vehicle accident, there are certain exceptions that can pause (toll) or shorten the standard filing period. These exceptions recognize that some victims may be unable to take legal action immediately due to age, legal complexities, or the involvement of government agencies.

Minors and the statute of limitations

If the injured party is under 18 years old at the time of the accident, the statute of limitations for filing a personal injury claim does not begin until they turn 18. This means that a minor who is involved in a car accident will generally have until their 20th birthday to file a lawsuit for injuries sustained in the crash.

For example, if a 16-year-old passenger is seriously injured in an accident, they typically cannot file a lawsuit on their own. However, because the statute of limitations is “tolled” (paused) until they reach adulthood, they have two years from their 18th birthday to file a claim. This exception ensures that minors, who may not have the legal capacity to act independently, have a fair opportunity to seek compensation once they become adults.

However, this exception does not apply to property damage claims. If a minor’s vehicle is damaged in an accident, the normal six-year statute of limitations for property damage claims still applies, regardless of their age.

Claims against government entities

If your accident involves a government-owned vehicle, such as a police car, postal truck, public bus, or any state, county, or municipal vehicle, special rules apply. Unlike claims against private individuals, lawsuits against government entities in New Jersey must follow strict notice requirements.

Under the New Jersey Tort Claims Act, you must file a formal notice of claim within 90 days of the accident if you intend to seek damages from a government agency. This notice must include:

• The name and address of the claimant
• A description of the accident, including the date, time, and location
• Details of the injuries and damages suffered
• The name of the government entity responsible

Failing to submit this notice within 90 days typically bars you from filing a lawsuit later, meaning you may lose the right to seek compensation. However, in some cases, courts may allow an extension if the victim can show extraordinary circumstances that prevented them from filing on time.

For example, if you were hit by a New Jersey Transit bus, a claim against NJ Transit must be filed within 90 days of the accident. If you miss this deadline, even by a single day, your right to sue the agency could be permanently lost.

While these rules primarily apply to personal injury claims, they may also impact property damage claims involving government-owned vehicles. Consulting an attorney early in the process can help ensure you meet the necessary legal deadlines.

Other potential exceptions

Though less common, additional exceptions to the statute of limitations may apply in certain cases:

• Mental incapacity: If a person suffers a severe mental or cognitive impairment due to the accident (e.g., a coma or traumatic brain injury), the statute of limitations may be paused until they regain the ability to take legal action
• Defendant’s absence: If the at-fault driver leaves the state for an extended period after the accident, the statute of limitations may be paused until they return. This prevents negligent drivers from evading lawsuits by relocating to another state

Understanding these exceptions can be crucial in protecting your right to compensation. If you believe one of these scenarios applies to your case, consulting with a legal professional as soon as possible is recommended to ensure you meet all necessary deadlines.

Accident Reporting Requirements

When to report an accident

In New Jersey, drivers must report an accident to the police if it involves:

• Injury or death
• Property damage exceeding $500

Failing to report an accident can lead to fines, points on your driving record, and potential suspension of your license.

How to file an accident report

• Call 911 at the scene if the accident involves injuries or significant property damage
• If law enforcement does not respond, you must file an accident report within 10 days with the New Jersey Motor Vehicle Commission (NJ MVC)
• Accident reports can be requested through the New Jersey State Police for legal or insurance purposes

Compensation Limits in New Jersey

Economic and non-economic damages

Unlike some states, New Jersey does not cap economic or non-economic damages in personal injury lawsuits. This means that accident victims can recover:

• Medical expenses
• Lost wages
• Vehicle repair costs
• Pain and suffering (if eligible under the right to sue rules)

Punitive damages

Punitive damages are awarded in cases of extreme negligence or intentional harm. In New Jersey, punitive damages are capped at $350,000 or five times the compensatory damages, whichever is greater.

Medical Coverage & Injury Protection

Personal Injury Protection (PIP)

New Jersey mandates PIP coverage, which covers medical expenses, lost wages, and essential services for policyholders and passengers, regardless of fault. The minimum required PIP coverage is $15,000, but drivers can opt for higher limits.

Medical liens and insurance reimbursement

Hospitals and medical providers can place a lien on settlements to recover unpaid medical bills. Additionally, health insurance may be used after PIP benefits are exhausted, but insurers may require reimbursement from your settlement.

Unique Driving Factors in New Jersey

High traffic congestion

New Jersey has some of the most congested roads in the U.S., particularly in Newark, Jersey City, and along the New Jersey Turnpike and Garden State Parkway. Heavy traffic increases accident risks, especially during rush hours.

Weather-related accidents

New Jersey experiences snow, ice, and heavy rainfall, all of which contribute to hazardous road conditions. Black ice is particularly dangerous during winter, leading to a high number of multi-vehicle collisions.

Legal Resources & Assistance

If you’re involved in a motor vehicle accident in New Jersey, knowing where to turn for guidance and support is essential. Several state agencies oversee accident reporting, insurance regulations, and law enforcement procedures. Whether you need to file a report, check the status of your driver’s license, or seek help with an insurance dispute, the following resources can assist you.

The New Jersey Motor Vehicle Commission (NJ MVC) is responsible for vehicle registration, driver’s licenses, and accident-related documentation. If you need to obtain an accident report, update your insurance records, or reinstate a suspended license, the MVC is the agency to contact. Their website, www.state.nj.us/mvc, provides detailed information on reporting accidents, legal requirements for drivers, and steps to take after a collision.

For insurance-related matters, the New Jersey Department of Banking & Insurance (NJDOBI) is the primary authority. This agency regulates auto insurance policies, ensures that insurance companies follow state laws, and helps consumers resolve disputes with their insurers. If you’re having trouble with an insurance claim or believe your provider is acting unfairly, NJDOBI can offer assistance. You can visit their website at www.state.nj.us/dobi to learn more about insurance regulations and consumer rights.

The New Jersey State Police (NJSP) plays a crucial role in handling accident investigations and maintaining public safety on the roads. If your accident involves a hit-and-run, a suspected DUI, or serious injuries, the NJSP will likely be involved in the case. They also provide access to crash reports, which can be useful for insurance claims and legal proceedings. More information, including how to request an accident report, can be found on their website at www.njsp.org.

Beyond these state agencies, consulting with a personal injury attorney can be beneficial if you need legal guidance after an accident. An experienced attorney can help determine liability, negotiate with insurance companies, and ensure you receive fair compensation. Many law firms offer free consultations to discuss your case and explore your legal options.

Whether you need to report an accident, resolve an insurance dispute, or seek legal representation, these resources can provide valuable support in the aftermath of a motor vehicle accident in New Jersey.