Murphy signs costly auto insurance law that will affect 1.1 million NJ drivers

More than one million New Jersey drivers will likely pay more to insure their vehicles after Governor Phil Murphy signed a controversial bill into law on Friday.

The measure will increase the minimum amount of liability insurance in the Garden State from its current coverage of $15,000 to $25,000 starting in 2023, and to a minimum of $35,000 starting in 2026. Officials of the industry said about 1.1 million drivers would pay about $125 more each year.

Proponents of the measure have argued that accident victims have not always been able to fully cover their medical costs due to the low coverage option.

It passed the state Senate last month by a 25-13 vote without any discussion and 44-29 in the Assembly after encountering a slight downturn when two Republican lawmakers voted against it. They eliminated both Democratic-controlled chambers largely along party lines.

“This is a very, very bad bill,” said Deputy Robert Auth, R-Bergen, at the time. “Let’s give poor, middle and working class families in New Jersey a break to cry out loud. Give them a fucking break.

The law Murphy signed was a streamlined reform bill that State Senate Speaker Nicholas Scutari, D-Union, originally hoped to pass.

Scutari has sponsored more than half a dozen bills that opponents say would force 1.27 million drivers to pay up to $350 more a year.

Its initial measures would have required drivers to select plans with a minimum of $250,000 in injury protection, commonly referred to as PIP. Another bill would prohibit motorists from using private health insurance as the primary payer for injury protection coverage in exchange for a car insurance discount.

A group that represents insurers, the Insurance Council of New Jersey, agreed to increase minimum coverage to $25,000 but opposed the bill because of the automatic increase in 2026. The average cost of a personal injury claim is $18,000, according to the group.

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