In the state of New Jersey, individuals have an option of buying two different types of auto insurance policies; these are known as Standard and Basic. A "Standard" policy offers more coverage and gives the policyholders the option to purchase additional protection. A "Basic" policy provides the minimum protection that will satisfy the state's insuring laws and is a lower costing option of getting insured.
How Standard and Basic NJ Auto Insurance Policies Differ
Standard Policy: These types of policies are more common among New Jersey drivers; this is because it offers more protection for motorists and options that may not be available with a Basic policy, but car insurance quotes can be a bit higher. "Standard" car insurance include Bodily Injury and Property Damage Liability with the option to purchase higher limits above the state minimum. This will cover the cost of bodily injury or property damage caused to another party up to the limits purchased.
Also included is Personal Injury Protection (PIP) which will pay for injuries sustained by policyholders resulting from an accident up to the limit stated on the policy. Motorists can choose limits at the time of purchase and the options range from $15,000 to $250,000 and may affect the price of the premium along with the deductible chosen which can be between $250 and $2,500.
In addition, a minimum amount of Uninsured/Underinsured Motorist coverage is included; higher limits can be purchase, but cannot exceed the Liability limits chosen. Comprehensive and Collision are available as options on a standard policy and will help compensate for physical damage sustained by the insured's automobile minus the deductible chosen.
Basic Policy: These types of policies are a more affordable option for New Jersey auto insurance, but also provide less coverage than a standard policy; this type of protection will include $5,000 for Property Damage Liability and $15,000 in PIP. It does not include Bodily Injury Liability, but a $10,000 limit for injuries to all persons per accident can be purchased as an option.
One of the major differences is that these policies do not include Uninsured/Underinsured Motorist and Comprehensive and Collision may only be offered by some insurers. If one is choosing to purchase a Basic policy and is in need of protection for physical damage to their vehicle, they should make sure that the insuring company offers this option.
It is recommended by the state that opting for "basic" coverage should be considered by younger drivers and/or those who have few family responsibilities and assets. Having minimum protection can leave a person liable for compensation above their coverage limits that they have caused. It is wise to compare quotes on both types of policies to see what can be afforded and purchase as much protection as possible.