Car insurance rates have been on the rise nationwide, and this has also held true for the state of New Jersey. Additionally, recent reports indicate that the average New Jersey resident is paying more than they should for car insurance. In any case, rates vary widely based on the insurer, city/county, age, driving history, type of vehicle, and even credit score. So what are the best cheap car insurance companies in New Jersey?

Best Car Insurance Companies for New Jersey
Find the best car insurance companies for New Jersey and visit Cape May. Image by David Mark from Pixabay

To get a clearer idea of how auto insurance works and how to find the best car insurance companies in New Jersey, let’s first take a look at how New Jersey laws regulate drivers, their insurance, and their vehicles. 

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Best Cheap Car Insurance Companies in New Jersey (2019)

Car Insurance Laws for New Jersey

According to the New Jersey state government website, drivers must abide by the following regulations:

  • Generally, New Jersey auto insurance can be divided into two distinct types: standard and basic. A “standard” policy includes more coverage, while a “basic” policy reflects the minimum level of coverage required by the state of New Jersey
  • With basic coverage, you are not required to have Bodily Injury Liability, Collision, Uninsured/Underinsured Motorist Coverage, or Comprehensive coverage. However, these are included with a standard policy.
  • The state requires, at minimum, coverage up to $5,000 per accident for Property Damage Liability. 
  • Additionally, drivers must obtain, at minimum, up to $15,000 per person, per accident for Personal Injury Protection (PIP) and $30,000 per accident.

If you’re looking to compare this to New York, check out the best cheap car insurance rates in New York guide as well as the best car insurance rates for New York City drivers guide.

How Car Insurance Rates are Determined in New Jersey

As of the latest data, good drivers in New Jersey pay an average of $2,587 annually for auto insurance or about $215 per month. Rates vary by the insurance provider, location, insurance type, and the level of coverage. However, these rates are also highly dependent on drivers.

When an insurance provider is calculating your rates, they will look at the following factors:

  • Location – Generally, if you live, commute, or work in an urban area (like Newark, Jersey City, or Paterson), your rates will be higher, as accidents are more prevalent in densely-populated regions. However, other location-based factors are important, too, like adverse weather conditions and reports of vandalism.
  • Age – Statistically, younger drivers get in more accidents. This means that the younger you are, the more you will need to pay in insurance premiums. The average age in New Jersey is 40, which is higher than the national average.
  • Gender – Men are more likely than women to get in accidents, so your gender could impact your auto rates as well.
  • Marital Status – Typically, married couples take fewer risks than their single counterparts, and this holds true for driving. Married couples get in fewer accidents, and therefore pose a smaller risk for insurance providers.
  • Driving Experience – While this metric is similar to age, it is still slightly different. Usually, the older you are, the longer you have been driving, but that is not always true. Nonetheless, people who have held a driver’s license for longer are more experienced, and therefore pay lower premiums.
  • Driving Record – A driver’s record is one of the most important factors that insurance providers consider. If you have a history of frequent speeding tickets, DUIs, or other infractions, you will have to pay more. New Jersey’s rate of traffic incidents is significantly higher than the national average.
  • Claims Record – It is also important to consider how many claims you have made to insurance providers in the past (if any). At-fault claims will cause your premiums to rise, while not-at-fault collisions will generally have no impact on your rates.
  • Credit History – Your credit is a good indicator of how financially responsible you are, but the research also shows that people with low credit tend to file more claims, making them a greater risk for insurance providers.
  • Previous Insurance Coverage – If you have maintained auto insurance without any gaps, your new insurance provider will see this as a good sign. However, if you went for several years, months, or even days without any insurance, you will be seen as high-risk.
  • Vehicle Type – Certain cars are driven differently, which means that certain cars are more prone to accidents. Some cars are also more prone to theft or vandalism.
  • Use of Vehicle – When you exclusively use your vehicle for personal use, you are less likely to get in an accident. However, if you take long business trips or frequently drive for your work, you increase your chances of a collision. 
  • Annual Mileage – How much you drive directly impacts your chances of getting in an accident. No matter how you use your vehicle (personal or business use), if you put a lot of mileage on your car, you are more likely to file a claim with your insurance provider.
  • Number of Policies – Finally, the type of insurance you want/need will help determine your rates. The more policies you have (liability, comprehensive, uninsured motorist, etc.), the more you will need to pay.

Best Car Insurance Companies for New Jersey

When looking at rates across the entire state, there are 4 major insurance companies that consistently provide low rates for good drivers. Additionally, there are several other companies that provide low rates in certain cities and counties but do not consistently provide low rates statewide.

In any case, let’s take a look at some of the lowest auto insurance rates and best car insurance companies available in the state of New Jersey:

ProviderAnnual RateMonthly Rate
Geico$1,389$115
NJM$1,479$123
Allstate$1,598$133
State Farm$2,082$173

 

It is important to note that the table above shows the average rates for the minimum coverage required by the state of New Jersey. For standard, comprehensive, or “full coverage,” the rates are significantly higher:

 

ProviderAnnual RateMonthly Rate
Geico$1,736$144
NJM$1,774$147
Allstate$1,885$157
State Farm$2,394$199

 

These are approximate rates based on statewide polling for 40-year-old men and women with good driving records. Naturally, individual rates will vary. Additionally, insurers like Progressive, Mercury, and MetLife provide low rates for certain areas and applicants.

So, in order to get a better picture of auto insurance rates around the state, let’s look at how rates vary by city.

Best New Jersey Car Insurance Rates by City

Aside from your driving history, your location is one of the most important factors when calculating the cost of your auto insurance. Population, crime rates, weather conditions, and the cost of living can all affect the amount you pay each year.

Individuals who live and work in rural areas typically have the lowest rates. However, the majority of New Jersey residents live in urban or suburban areas, where rates tend to increase. 

The table below shows the average yearly auto insurance rates for 50 of the most populated cities in New Jersey, in alphabetical order. These are approximate rates based on statewide polling for 40-year-old men and women with good driving records.

Additionally, this data is taken from all of the best car insurance companies in New Jersey. Here is what the data shows:

CityAverage Yearly Rate
Absecon$1,546
Asbury Park$1,356
Atlantic City$1,982
Basking Ridge$1,284
Bayonne$1,728
Belleville$1,836
Bergenfield$1,621
Blackwood$1,361
Bloomfield$1,734
Brick$1,339
Bridgeton$1,491
Bridgewater$1,344
Burlington$1,278
Caldwell$1,347
Camden$2,077
Cherry Hill$1,355
Clementon$1,563
Clifton$1,832
East Brunswick$1,367
East Orange$2,028
Edison$1,452
Egg Harbor Township$1,704
Elizabeth$1,925
Englewood$1,789
Englishtown$1,367
Fair Lawn$1,524
Flemington$1,344
Fort Lee$1,891
Freehold$1,367
Garfield$1,907
Hackensack$1,777
Hackettstown$1,213
Hightstown$1,319
Hillsborough$1,344
Hoboken$1,681
Howell$1,367
Irvington$1,970
Jackson$1,416
Jersey City$1,681
Kearny$1,704
Lakewood$1,416
Lodi$1,794
New Brunswick$1,573
Newark$2,038
North Bergen$1,996
Orange$2,028
Passaic$2,065
Paterson$2,052
Plainfield$1,805
Union City$2,017

 

Now, let’s take a closer look at the top-5 largest cities in New Jersey and compare their respective auto insurance rates:

Newark

In Newark, the average annual premium is $2,038 for minimum liability insurance and $2,710 for full auto coverage. However, as with most large cities, these prices can vary by district or neighborhood.

For example, residents of Downtown Newark will generally pay much higher premiums than those living in the suburbs of the city.

Unfortunately, Newark is not a particularly safe place to drive. Newark drivers get in more accidents than residents of most other major U.S. cities. As a result, car insurance premiums tend to be high.

Jersey City

In Jersey City, the average annual premium is $1,681 for minimum liability insurance and $2,185 for full auto coverage. While there is not a lot of variation between rates in different neighborhoods, Jersey City experiences higher auto insurance premiums across the board due to adverse weather conditions.

On average, Jersey City gets more than 100 days of precipitation (both rain and snow) every year. This puts extra strain on vehicles and increases the rate of collisions.

Paterson

In Paterson, the average annual premium is $2,052 for minimum liability insurance and $2,770 for full auto coverage. While Paterson has safer drivers than both Newark and Jersey City, it does not rank very highly among cities across the nation.

Additionally, roadways in Paterson are a major cause of high insurance premiums. More than 30% of Paterson’s roads are considered to be in “poor” condition.

Elizabeth

In Elizabeth, the average annual premium is $1,925 for minimum liability insurance and $2,464 for full auto coverage. Elizabeth receives more than 25 inches of snow annually, which is not as much as some other cities in New Jersey. Still, it is enough to cause additional wear-and-tear on vehicles.

Despite its relatively small population, Elizabeth also gets a fair amount of traffic, which can lead to higher collision rates.

Clifton

In Clifton, the average annual premium is $1,832 for minimum liability insurance and $2,290 for full auto coverage. Unfortunately for resident drivers, weather conditions and frequent moving violations are both common issues in the city. Clifton experiences more than 120 days of precipitation every year, and the city also has some of the highest rates of moving violations in the state.

So, despite the small population (compared to Newark and Jersey City), Clifton drivers must pay pretty steep car insurance premiums.

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Who has the Best Auto Insurance Rates in New Jersey?

As you can see, there are a lot of variables that affect the cost of auto insurance in New Jersey. Additionally, the figures provided above are averages based on adults with good driving records. The exact rates you pay may differ.

Nonetheless, we hope that this information helps you when you’re ready to obtain a new policy or upgrade your current one with one of the best car insurance companies in New Jersey.

If you’d like to learn more about acquiring auto insurance in your state, consult some of our other car insurance guides and resources. If you’re looking for more information about New Jersey auto insurance, consult the New Jersey state government website today!   

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Johnny Jet Editorial