When you want to drive a motor vehicle in the state of New Jersey, you are required by law to carry a minimum amount of insurance. Luckily, the New Jersey Automobile Insurance Cost Reduction Act makes sure that all drivers are able to get a basic insurance policy, even if they can’t afford all the extras. It is important that you make sure you have the right amount of insurance coverage. Otherwise, you are at risk of being fined, having your driver’s license suspended, having your vehicle registration suspended and even spending time in prison. If you are caught multiple times driving without insurance, your vehicle may be impounded.

The Basic Policy and Extras

This is a great option for those who don’t have a lot of money but need to be able to drive their vehicles. It is also great for younger drivers who are just starting out and don’t have much. Drivers get the protection they need without having to spend more than they can really afford. This policy obviously doesn’t offer the same protection as a standard policy, but it is less expensive and a good option for anyone who doesn’t think they can afford the auto insurance they need. Here is a rundown of the coverage you will receive with the basic policy (and some additional options):

• Property Damage Liability Coverage – This will cover you for claims and legal actions by those whose property is damaged after an accident that is your fault. You will receive $5,000 for each accident.
• Bodily Injury Liability Coverage – This will cover you for claims and legal actions by those who are injured in an accident where you are at fault. This is not part of the basic policy, but you can get it as an option.
• Personal Injury Protection (PIP) – This is coverage for your own injuries and the injuries of others who are covered under your policy, no matter who is at fault in an accident. You will receive $15,000 for each accident, each person up to a total of $250,000 for permanent injury.
• Underinsured/Uninsured Motorist Coverage – If you are involved in an accident with an uninsured driver, it can add up to a lot of money. You could end up having to take that driver to court, and there is no guarantee that you will ever see any money to pay for your damages. Having this coverage will protect you in such situations, but it is not part of the basic policy and you will have to have it added.
• Comprehensive Coverage – This is coverage that is not covered in your basic policy but that you should have if you own a newer-model vehicle. It will cover you if there are damages to your vehicle that are not caused by an accident, such as broken windshields, vandalism, fire, flooding, etc. This also covers you if you run into an animal while driving. You should have this coverage if your vehicle is leased or a loaner.
• Collision Coverage – If there is any damage to your automobile following an accident, having additional collision coverage will pay for those damages. This is another extra that you will need to have added to the basic policy if you want it.

Collision and comprehensive insurance coverage are options you can get that are issued through the Persona Automobile Insurance Plan (PAIP). This is a new project that was designed to allow drivers with lower incomes and who are qualified for Federal Medicaid to still have the insurance coverage they need. You can get a medical-only policy that will cost less than $400 per year.

If you are enrolled in the Medicaid program with hospitalization, you can get the Dollar a Day insurance policy. This will provide coverage for immediate emergency treatments following an auto accident as well as treatment for severe spinal cord and brain injuries. You may only have one vehicle for each policy to receive this coverage.

Get Quotes to Get the Best Insurance Rates

You need to shop around in order to get the best insurance rates. This involves getting quotes from many different insurance companies. You can do this online and remain totally anonymous until you are ready to buy an insurance policy. You will be required to submit some information, such as your zip code and driving record, but you won’t have to worry about being bothered by insurance agents until you have made your final decision. Shopping around will get you the best rates on the insurance coverage that you are required by law to have in the state of New Jersey.