How New Jersey’s New Insurance Requirement Affects Your Trucking Business
New Jersey has increased the minimum liability insurance coverage for all commercial vehicles operating within its borders to $1.5 million.
Each insurance company is handling this new mandate differently. Some may require policy changes to comply, others may not offer coverage if your trucks travel through New Jersey, and some may not require any changes at all.
Immediate Action Required
For those of you with vehicles traveling into or through New Jersey, it is essential to review your policy with us to ensure you have the necessary coverage. Please get in touch with us as soon as possible to discuss your options.
Understanding the New Requirement
The variations in how insurance companies are addressing this issue stem from the wording of the New Jersey law and the states’ rights to set their own minimum coverage levels. While states often set their own minimum auto insurance requirements, this is the first instance we know of where a state mandates higher commercial auto coverage than the federal minimum. This situation is similar to California’s stricter emissions standards compared to federal requirements.
The New Law
New Jersey’s new law raises the minimum liability coverage for commercial motor vehicles to $1.5 million. This applies to all vehicles registered or primarily garaged in New Jersey, including those registered under the International Registration Plan (IRP).
Potential Impact on Your Business
Without clear enforcement guidelines from New Jersey, insurance companies are adopting different approaches. Some expect strict enforcement based on the law’s literal wording, while others anticipate leniency for non-New Jersey-domiciled vehicles. There’s also a possibility that the courts will ultimately decide how this law is enforced.
Why This Matters
The uncertainty leaves room for legal challenges that could require an insurance carrier to pay out the $1.5 million minimum instead of the federal $750,000 minimum for accidents occurring in New Jersey. This could significantly impact your business if your insurance policy is not updated to meet the new requirements.
Our Recommendation
At Cook Insurance Group, we recommend that you treat New Jersey’s new insurance requirements seriously. Just as some have opted to avoid California due to its stringent emissions regulations, it may be wise to consider the implications of this new insurance mandate on your operations.
If your trucks travel into or through New Jersey, please contact us immediately to review and adjust your insurance coverage as necessary.
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