Information on NJ Assigned Risk and NJ Preferred Risk Automobile Insurance.

How does where I live in New Jersey affect my premium?

Where you live or, more precisely, where you keep your auto in NJ at night has a bearing on your chances of having an accident or becoming a victim of theft or vandalism. That is why a vehicle owner in Elizabeth NJ, pays a higher rate than the owner of an identical vehicle in Vineland NJ.
Other factors affecting insurance territory rates include time and efficiency of police response and law enforcement, local road and traffic conditions and the quality of local medical services. Insurers even factor in the litigation rates in a given area, how many lawsuits are filed, go to trial, are settled out of court, and for how much money.

Why are rates different for different cars, even if the cars cost the same?

Vehicles are also grouped into categories according to their chances of being damaged, vandalized or stolen. Insurance companies generally consider the size and type of car as well as the value and the cost of repairs which vary greatly, even on cars that cost about the same amount. Therefore, it is assumed that a new sport utility vehicle is expected to hold up better in an accident than a sleek sports car or a sub-compact car.
That is why you should research insurance coverage before you buy your car. It helps you to understand the actual cost and indicates those vehicles with good safety records. Your NJ insurance company will ultimately reward you with lower premiums for putting safety first.

What is no-fault insurance?
No-fault insurance is a system adopted in some states that essentially bypasses the conventional legal procedure which finds fault in an accident. This is the procedure by which you hire a attorney, file suit and possibly go to court to prove the accident was the other guy's fault. No-fault simply does away with the concept of one party or the other being at fault--no lawyers, no court, no judge, no jury, no lengthy lawsuits against the other party. This is considered beneficial to all taxpayers, because it eliminates costly legal proceedings that the state must manage, and to insurance policyholders, because it helps keep rates down.
If you are insured in a no-fault state and have an accident, you do not have to go after the other driver. You contact your own insurer and file a claim. Your own insurance policy guarantees you immediate compensation for damages, medical expenses, lost wages, essential services, rental car arrangements etc. (If these coverages are included)
The type and range of no-fault car insurance coverage varies from state to state. What defines the limitations of no-fault policies can differ in two important areas:
Threshold--The type of damage or injury or the cost of repair or recovery that triggers the need for legal action.
Mandated--Benefit Level The package of benefits (medical, wage loss, replacement services and other expenses) your state requires you to carry.

Do all states require some kind of liability insurance?

No. Some states, while not mandating auto insurance, have what is known as financial responsibility laws that require all drivers to be able to pay for any damage or injury they may cause. However, carrying liability insurance is still the best and most affordable way for you to meet your state's financial responsibility requirements once you know what they are.

UM and UIM policies are offered by law in all states, including no fault states. In fact, some states require all motorists to carry this coverage in order to gain protection from inadequate insurance coverage of other drivers that may not carry enough or higher limits as the majority does; i.e., 100-300-50,000.

What happens if I have an accident with an NJ uninsured or NJ underinsured or out of state driver?
First, call the police to the scene to be sure all pertinent information is properly recorded. Your nerves will be shaken right after an accident, and it helps to have a calm and knowledgeable person walking you through the necessary details.
Then, contact your policy holder services or claims number usually on you ID Card immediately and ask about filing a claim. If you followed all the recommended guidelines and procedures when you bought your policy, you should be covered within the benefits and or limitations of that policy. Remember, your car insurance policy is designed to protect you and anyone in your vehicle.

If the cost of your physical damages or personal injuries exceed the amount your policy will pay for, it may be time to take legal action against the other party. Even if you have no-fault insurance, sometimes the only way to be compensated is to place blame and responsibility where it belongs. That is why it is best to get a police report documenting the incident and any witnesses statement while it is fresh in their minds. This will preserve that moment in time and remove any room for doubt later in the legal process.
It is better to have the police report and not really need it, than it is to need one for court and not have one because it would have taken another thirty minutes to an hour extra at the incident scene.
Why would my NJ Insurer cancel my policy?

Technically, in most states your insurer can cancel your policy only if:

you fail to pay your premium;
you lose your driver's license;
you are guilty of material misrepresentation during the application process i.e., you fail to notify your insurer of a recorded violation, such as a drunken driving, or possession of drugs or any illegal activity offense; or
you fail to report a substantial change of risk, such as buying a new high performance sports car to replace an old high mileage family sedan.

Getting yourself out of the NJ PAIP- high risk auto insurance NJ or assigned risk category is going to take a little time. You may need to consider the following, cleaning up a bad driving record and paying your bills on time. Some factors will fade with time.

Most insurance companies rate a driver with no points for three years as a good or preferred risk. But there are a few things you can do to cut high risk auto insurance costs now! Consider driving an older car and dropping collision and comprehensive coverages. if you can accept the risk, carry lower amounts of other standard coverages.