From 15/30/5 to 35/70/25: Understanding New Jersey's Coverage History

New Jersey's minimum auto insurance requirements have undergone a dramatic transformation over the past few years. For decades, the Garden State had some of the lowest minimums in the country — just $15,000 per person / $30,000 per accident in bodily injury liability, and a paltry $5,000 in property damage coverage. These limits were so low that even a minor fender-bender could leave a driver personally on the hook for tens of thousands of dollars.

In 2022, New Jersey enacted P.L. 2022, c.87, a two-phase law designed to modernize those outdated minimums. Phase 1 kicked in on January 1, 2023, bumping limits to 25/50/25. Phase 2 — the final step — took effect January 1, 2026, bringing the state to the current 35/70/25 standard.

Here's how the numbers evolved across all three tiers:

Note: Uninsured/Underinsured Motorist (UM/UIM) coverage must now also match the new liability minimums at $35,000/$70,000. Personal Injury Protection (PIP) remains at the $15,000 minimum.

For a broader look at how NJ compares to the rest of the country, see our guide to car insurance minimum requirements by state.

Why New Jersey Raised the Minimums

New Jersey's old 15/30/5 standard hadn't kept pace with decades of inflation in medical costs, vehicle repair prices, or legal settlements. A single serious injury from a car accident can easily result in medical bills well above $15,000, which meant victims were frequently left undercompensated while at-fault drivers faced personal lawsuits to cover the gap.

The driving forces behind the increase include:

• Medical cost inflation: Hospital and emergency care costs have risen substantially since the original minimums were set
• Rising vehicle repair costs: Parts, labor, and supply chain pressures have pushed average repair costs far beyond $5,000 (the old property damage limit)
• Inadequate protection for victims: The old minimums often failed to cover real-world damages in even moderate accidents
• Nationwide trend: New Jersey joined several other states — including California, Virginia, and Utah — in updating their outdated liability floors

Understanding how liability car insurance works is essential before deciding how much coverage to carry beyond the new state floor.

How the New Minimums Affect You Right Now

What Happens to Your Existing Policy

If you had a policy in effect before January 1, 2026 with limits that no longer comply, your insurer was required — per the NJ Department of Banking and Insurance Bulletin No. 25-06 — to automatically increase your coverage at renewal and notify you in writing. Insurers had to file updated rates by September 1, 2025 to comply.

Estimated Cost Increases for NJ Drivers

New Jersey is projected to lead all 50 states with the highest estimated auto insurance rate increase in 2026 — approximately 10.46% on average. While the new minimum requirements aren't the only factor (claims inflation and other cost pressures also play a role), they are a significant driver of premium hikes for policies at or near the minimum threshold.

Penalties for Non-Compliance

Driving without meeting NJ's required minimums carries serious consequences. The NJ MVC makes clear that all drivers must carry proof of adequate insurance while operating a vehicle. Failure to comply can result in:

• Hefty fines for driving without proper coverage
• License and vehicle registration suspension
• Potential jail time for violations of financial responsibility laws
• Full personal liability for any accident damages that exceed your coverage — meaning your wages, savings, and assets could be at risk

Should You Buy More Than the New Minimums?

The short answer: yes, in most cases. The new 35/70/25 minimums are a significant improvement over what New Jersey required before, but they still fall short of what experts recommend for meaningful financial protection.

Consider this: a single serious injury accident involving hospitalization, surgery, and rehabilitation can easily exceed $100,000 — far more than the $35,000 per-person limit. If you're found at fault, you're personally responsible for any costs above your policy limits.

Coverage Levels Worth Considering

Key Upgrades to Consider

• Higher Bodily Injury Limits (100/300 or more): Recommended for homeowners, higher-income earners, or anyone with substantial assets to protect
• Increased UM/UIM Coverage: Especially important in New Jersey, where uninsured drivers remain a real risk. This coverage protects you when the other driver's policy is inadequate
• Higher PIP: The $15,000 PIP minimum hasn't changed — but in a no-fault state like NJ, this is your primary medical coverage after an accident. Consider $250,000 or even unlimited PIP if medical costs are a concern
• Collision & Comprehensive: Covers damage to your own vehicle regardless of fault — essential for newer or financed vehicles

Our in-depth guide on how to choose car insurance liability limits can help you figure out the right numbers for your financial situation. You can also learn more about whether state minimum car insurance is enough before finalizing your coverage decision.

Frequently Asked Questions

What exactly is New Jersey's new 35/70/25 car insurance requirement?

The 35/70/25 standard refers to the minimum liability coverage required for New Jersey drivers as of January 1, 2026. It means your policy must include at least $35,000 in bodily injury liability per person injured, $70,000 total per accident regardless of how many people are injured, and $25,000 for property damage per accident. Your uninsured/underinsured motorist coverage must also match these bodily injury limits at $35,000/$70,000. This is the second and final phase of a two-part law (P.L. 2022, c.87) enacted in August 2022.

Do I need to do anything, or will my insurer update my policy automatically?

In most cases, your insurer is required to automatically update your policy to meet the new minimums when it renews after January 1, 2026. The NJ Department of Banking and Insurance issued a bulletin requiring all carriers to file updated rates and notify policyholders. However, you should proactively check your declarations page or call your agent to confirm your limits have been updated — don't assume it was done correctly without verification.

How much will my car insurance go up because of the 2026 NJ minimums?

New Jersey is projected to see the largest average auto insurance rate increase in the nation for 2026 — approximately 10.46%. However, your individual increase depends on several factors: your current coverage level, driving record, vehicle, location within NJ, and insurer. Drivers who were already carrying limits above the old 25/50/25 minimums will see little to no impact from the mandate itself. Those at or near the old minimums will likely see a more noticeable premium increase.

What happens if I'm caught driving without meeting the new NJ minimums?

Driving without meeting New Jersey's required minimums is a violation of the state's financial responsibility laws. Consequences can include heavy fines, suspension of your driver's license and vehicle registration, and even potential jail time in certain cases. Beyond the legal penalties, if you cause an accident without adequate coverage, you can be held personally liable for all damages and medical costs that exceed your policy's limits — putting your income, savings, and assets at risk.

Is the 35/70/25 minimum enough, or should I buy more coverage?

For most New Jersey drivers, the new minimums should be viewed as a legal floor — not a recommended level of protection. A serious car accident involving multiple injuries can quickly generate damages well above $35,000 per person. Insurance experts and attorneys generally recommend carrying at least 100/300 bodily injury liability along with higher UM/UIM limits. If you own a home or have significant savings, those assets could be targeted in a lawsuit if your liability coverage runs out. For peace of mind and genuine financial protection, consider coverage well above the state minimum.