As of January 1, 2026, all standard auto insurance policies in New Jersey must carry a minimum of $35,000 per person and $70,000 per accident in bodily injury liability coverage. The property damage minimum stays at $25,000. Uninsured/underinsured motorist (UM/UIM) coverage minimums also increased to match these new limits. Your insurer is legally required to adjust your policy automatically at renewal.
For more than 50 years, New Jersey drivers could legally carry as little as $15,000 in bodily injury coverage per person — an amount that barely covers a single emergency room visit today. The New Jersey Legislature recognized this gap and passed P.L.2022, c.87, a two-phase reform to bring coverage minimums closer to modern medical costs.
The first phase took effect on January 1, 2023, raising the per-person bodily injury minimum from $15,000 to $25,000. The second and final phase took effect on January 1, 2026, raising it again to $35,000. If you drive in New Jersey, these changes directly affect how much protection you have — and how much compensation may be available if you are injured in an accident caused by someone else.
What Are the New Auto Insurance Minimums in New Jersey for 2026?
The table below shows how New Jersey’s minimum liability requirements have changed across both phases of the reform. These limits apply only to standard auto policies, not basic (dollar-a-day) policies.
| Coverage Type | Before 2023 | 2023–2025 | 2026 Onward |
|---|---|---|---|
| Bodily Injury (per person) | $15,000 | $25,000 | $35,000 ✓ |
| Bodily Injury (per accident) | $30,000 | $50,000 | $70,000 ✓ |
| Property Damage (per accident) | $5,000 | $25,000 | $25,000 (unchanged) |
| UM/UIM (per person) | $15,000 | $25,000 | $35,000 ✓ |
| UM/UIM (per accident) | $30,000 | $50,000 | $70,000 ✓ |
These new limits are established under N.J.S.A. 39:6A-3 and apply to every new or renewed standard auto policy issued on or after January 1, 2026. The New Jersey Department of Banking and Insurance confirmed the requirements in DOBI Bulletin No. 25-06.
Why Did New Jersey Raise Auto Insurance Minimums?
The original $15,000 per-person minimum was set decades ago when medical costs were a fraction of what they are today. That amount had not changed in over 50 years, even as the cost of an MRI, a surgery, or a week of physical therapy soared far beyond what $15,000 could cover. Adjusted for inflation, the $15,000 minimum set in the 1970s would be equivalent to over $100,000 in today’s dollars.
The Legislature raised the limits for three key reasons:
- Undercompensation: A driver carrying only $15,000 in coverage could cause a crash resulting in $80,000 of medical bills, leaving the injured person with no way to recover the difference.
- Traffic density: New Jersey is the most densely populated state in the country with heavy daily traffic, meaning the risk of serious multi-vehicle collisions is higher than in more rural states.
- “Judgment-proof” scenarios: When an at-fault driver has too little insurance, an injured victim often cannot recover any meaningful compensation even after winning a lawsuit.
Important: The 2026 increase applies only to standard auto insurance policies. Basic auto policies — available to New Jersey drivers eligible for Medicaid with hospitalization — are not affected by this change.
How Does This Change Affect My Accident Claim in New Jersey?
If you are injured in a car accident caused by another driver, their bodily injury liability insurance is typically the first source of compensation available to you. With the new minimums, there is now at least $35,000 per person available from even the most basic standard policy — a $10,000 increase over the previous floor.
Real-world example: Suppose a driver causes a crash resulting in $55,000 in medical bills, lost wages, and pain and suffering. Under the old $25,000 minimum, the injured person could recover no more than $25,000, leaving a $30,000 gap. Under the new $35,000 minimum, that gap narrows to $20,000. While $35,000 may still fall short for serious injuries, it represents meaningful additional recovery.
The UM/UIM Increase Matters Even More
A critical but often overlooked part of this law is that uninsured and underinsured motorist (UM/UIM) coverage minimums also increased to match the new liability limits. UM/UIM coverage protects you — not the other driver. If the at-fault driver’s insurance is not enough to cover your losses, or if they have no insurance at all, your own UM/UIM coverage fills the gap.
With the new minimums, every standard policy in New Jersey now carries at least $35,000 per person and $70,000 per accident in UM/UIM coverage. Carrying higher UM/UIM limits — $100,000/$300,000 or more — often costs only modestly more per month but provides significantly greater protection.
When Did the New NJ Insurance Limits Take Effect?
The new limits took effect on January 1, 2026. Here is the full legislative timeline:
- August 5, 2022: Governor Murphy signs P.L.2022, c.87 into law, establishing a two-phase increase.
- January 1, 2023 — Phase 1: Bodily injury minimums increase to $25,000 per person / $50,000 per accident. Property damage increases to $25,000.
- July 31, 2025: NJ DOBI issues Bulletin No. 25-06, directing insurers to prepare Phase 2 rate filings and form updates.
- January 1, 2026 — Phase 2: Bodily injury minimums increase to $35,000/$70,000. UM/UIM minimums increase to match. Property damage remains at $25,000.
Do I Need to Do Anything to Update My Policy?
No. Your insurance carrier is legally required to adjust your coverage to the new minimums automatically when your policy renews on or after January 1, 2026. Insurers must also send you a written notification that your limits have been increased.
However, you should take two important steps:
- Check your declarations page to confirm the new limits are reflected on your renewal.
- Consider whether the new minimums are actually enough. A single serious accident can easily result in costs exceeding $35,000. Ask your agent about increasing your limits.
What We See in Practice: At our firm, we regularly handle cases where the at-fault driver’s policy limits are exhausted before the injured person’s medical bills are fully covered. Carrying higher bodily injury and UM/UIM limits offers far greater real-world protection at a modest additional cost.
Will My Premium Go Up Because of This Change?
If you currently carry only the state minimum, you may see a modest premium increase. Industry estimates suggest an increase of approximately $100 to $200 per vehicle per year for drivers at the old minimum coverage levels. The increase is relatively contained because the reform was phased in over several years.
If you already carry limits above the new minimums — for example, $50,000/$100,000 or higher — your premium is unlikely to change because of this law.
How Does This Interact with New Jersey’s No-Fault System?
New Jersey is a no-fault state, which means your own Personal Injury Protection (PIP) insurance pays for your medical bills after an accident regardless of who caused it. PIP is separate from the liability minimums that changed in 2026. The minimum PIP coverage in New Jersey is $15,000, and that amount did not change under the 2026 reform.
The liability limits that increased — bodily injury and UM/UIM — come into play when your injuries are serious enough to step outside the no-fault system. Whether you can do that depends on whether you elected the Limited Right to Sue (verbal threshold) or the Unlimited Right to Sue (zero threshold). Under the verbal threshold, you can only pursue pain and suffering damages if your injuries meet specific criteria: a displaced fracture, permanent injury, loss of a body part, significant disfigurement, loss of a fetus, or death.
Frequently Asked Questions About the 2026 NJ Insurance Changes
What are the new auto insurance minimums in New Jersey for 2026?
As of January 1, 2026, standard auto policies must carry at least $35,000 per person and $70,000 per accident in bodily injury liability. Property damage remains at $25,000 per accident. UM/UIM coverage minimums also increased to $35,000/$70,000 to match the new bodily injury limits.
When did the new NJ auto insurance limits take effect?
January 1, 2026. This was the second and final phase of a two-part reform enacted under P.L.2022, c.87. The first phase raised bodily injury limits to $25,000/$50,000 on January 1, 2023.
How do the 2026 insurance changes affect my accident claim?
If you are injured by an at-fault driver, there is now $35,000 per person (up from $25,000) available from their liability policy. Your own UM/UIM coverage also increased, giving you a larger financial safety net when the at-fault driver’s coverage is insufficient.
Do I need to contact my insurer to update my policy?
No. Insurers are legally required to automatically increase your limits at renewal. You should receive a written notification. However, check your declarations page to confirm the update was applied correctly.
Will my car insurance premium increase?
Drivers at the old minimum may see increases of roughly $100 to $200 per vehicle per year. If you already carry limits above the new minimums, your premium is unlikely to change because of this law.
Does this apply to NJ basic auto insurance policies?
No. The increase applies only to standard auto policies. Basic policies (available to Medicaid-eligible drivers) are not affected by this change.
Did PIP minimums change in 2026?
No. The minimum PIP coverage in New Jersey remains $15,000. The 2026 reform changed only bodily injury liability and UM/UIM minimums.
Is minimum coverage enough to protect me after a serious accident?
In most serious accidents, no. Medical bills from surgeries, imaging, and rehabilitation can easily exceed $35,000. Carrying higher limits — particularly for UM/UIM coverage — is one of the most effective ways to protect yourself financially.
Were You Injured in a Car Accident in New Jersey?
If you were hurt in a crash, understanding your insurance coverage is only the first step. At Sarofiem & Antoun, our New Jersey car accident lawyers have recovered millions for injured clients across Hudson County and the entire state. We review your policy, identify all available sources of compensation, and fight to maximize what you recover — with no fee unless we win.
Get your free case review today. Call us at (201) 792-3333 or fill out our online form. We are available 24/7.
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