How Much is Car Insurance in New Jersey?

If you’re living in New Jersey or thinking of moving there, you’ve probably wondered, “How much is car insurance in New Jersey?” You’re not the only one. Car insurance is one of those things you have to get, but pricing can feel all over the place—and sometimes unfair.

The truth is, car insurance in New Jersey tends to be more expensive than in many other states. But don’t stress. Whether you’re just shopping around or seriously looking to switch providers, we’re breaking down everything you need to know—what it costs, why it costs that much, and how you can get a better deal.

The Average Cost of Car Insurance in New Jersey

Let’s start with some real numbers. On average:

• Full coverage car insurance in New Jersey costs between $1,600 and $2,000 per year, which is around $135 to $165 per month.
• Minimum coverage costs closer to $850 to $1,000 per year, or about $70 to $85 per month.

Of course, these are just average figures. What you actually pay can vary widely. Some drivers pay a lot less, while others might be stuck with rates over $2,500 per year. It all depends on your unique profile and coverage needs.

Several sources, including data from the New Jersey Department of Banking and Insurance, confirm that NJ is among the top 10 most expensive states for auto insurance. That’s due to high population density, traffic volume, and claim frequency—especially in places like Newark, Jersey City, and Paterson.

So while these average numbers can give you a rough idea, the only way to know your true rate is by getting a personalized quote.

What Affects Car Insurance Rates in New Jersey?

Insurance companies look at a bunch of factors to figure out how much you’ll pay. Here are some of the biggest ones:

1. Your Driving Record

This one’s pretty straightforward. If you have a clean record with no accidents, tickets, or claims, you’ll likely pay less. If you’ve had recent violations or at-fault accidents, expect your rate to go up.

2. Your Location

Where you live in New Jersey plays a big role. Urban areas tend to have higher accident rates, more vehicle theft, and more claims—all of which drive up premiums. Living in a quieter suburb or rural area usually means lower rates.

3. Your Age and Experience

Younger drivers, especially those under 25, typically pay more. Why? Because statistically, they’re more likely to be involved in accidents. Older, more experienced drivers usually get better rates—especially if they have a solid driving history.

4. Type of Vehicle You Drive

Cars with higher repair or replacement costs will cost more to insure. So if you drive a brand-new luxury SUV, you’ll probably pay more than someone driving a used sedan. Safety features and theft risk also matter.

5. Credit Score

Yep, in New Jersey, insurers can factor in your credit score. Drivers with higher scores are seen as less risky and usually get lower rates.

6. Type and Level of Coverage

This one’s obvious, but it’s important: full coverage (which includes liability, collision, and comprehensive) costs more than minimum liability. But it also gives you way more protection.

7. Annual Mileage

How much you drive every year matters. People who drive less often are usually considered lower risk, and they might get a discount.

All of these pieces go into the pricing formula. Some are within your control—like your driving habits and vehicle choice—and some aren’t. But understanding how they work can help you make better insurance decisions.

Minimum Insurance Requirements in New Jersey

New Jersey gives drivers the option to choose between a Basic Policy and a Standard Policy. Understanding the difference is key to making sure you’re legally covered and financially protected.

Basic Policy

This is the bare minimum required by the state. It’s the cheapest option, but it comes with major limitations.

• Property Damage Liability: $5,000 per accident
• Personal Injury Protection (PIP): $15,000 per person, per accident (more for certain injuries)
• Bodily Injury Liability: Not included (unless you add it)

The Basic Policy might work if you rarely drive, have an older car, or can’t afford higher premiums—but it doesn’t provide much coverage.

Standard Policy

This one offers more options and higher protection. Most drivers in NJ go this route.

• Bodily Injury Liability: $25,000 per person / $50,000 per accident (can go higher)
• Property Damage Liability: $25,000 or more
• PIP: Up to $250,000
• Uninsured/Underinsured Motorist: Optional but highly recommended

It costs more, but you’ll be in a much better spot if you get into an accident—especially if it involves injuries or major damage.

How to Save on Car Insurance in New Jersey

While rates in NJ are on the higher side, there are ways to bring them down. It just takes a bit of planning and know-how.

Shop Around Every Year

Prices can change yearly—even if nothing major has changed in your life. Get multiple quotes before renewing. You could save hundreds by switching.

Bundle Your Policies

If you have renters or homeowners insurance, bundling with the same provider can earn you a discount.

Ask About Discounts

Some common ones include:

• Safe driver
• Low mileage
• Good student
• Defensive driving course
• Multi-car
• Anti-theft device

Increase Your Deductible

A higher deductible means a lower monthly premium. Just make sure you can afford to pay it if something happens.

Consider Usage-Based Insurance

Some companies offer programs where they track your driving habits (via an app or plug-in device). If you’re a safe driver, you could earn a discount.

Review Your Coverage Annually

If your car is getting older, it might not need full coverage anymore. Adjusting your coverage level can lead to big savings.

New Jersey drivers who take the time to review their policies and compare quotes often find better rates—without sacrificing coverage.

Should You Get Full or Minimum Coverage?

This decision really depends on your car and financial situation.

If your car is newer, financed, or worth more than $5,000, full coverage is the safer route. It protects against theft, vandalism, weather, and at-fault accidents.

If you’re driving an older car with a low market value and no loan attached, minimum coverage might be enough—especially if you're trying to save money.

Just remember, New Jersey is a no-fault state, so your insurance will always pay your medical bills regardless of who caused the accident. That’s why having decent PIP coverage is crucial, no matter which route you choose.

Get the Best Rate for Car Insurance in New Jersey

So, how much is car insurance in New Jersey? On average, it’s more expensive than most states—but it doesn’t have to break your budget. By understanding the factors that impact your rate and taking a few smart steps, you can find affordable coverage that fits your life.

Whether you want basic protection or full coverage, the best thing you can do is compare rates from multiple carriers. That’s where we come in.

Compare rates with Defy Insurance now and find the best price without the hassle. We make it easy, fast, and totally free.