When compared to the rest of the country, Pennsylvania and New Jersey are both ranked within the mid-to-high 20 to 30 range of the most expensive states when it comes to the cost of auto insurance premiums, but the large difference between the two states is the legal amount you are required to buy, as well as your insurance litigation options after an accident.
Average Premium Price
As of March, 2011, New Jersey was ranked 17th-highest in the nation for auto insurance premiums, while Pennsylvania was ranked 30th, according to Insure.com. New Jersey drivers paid an average of approximately $1,660 per vehicle, or roughly $200 more a year than Pennsylvania's $1,460 average. Both Pennsylvania and New Jersey are within $100 of the national average, which was $1,561 per year as of March, 2011.
Under New Jersey law, drivers are required to carry property damage liability (or PD), which covers the policy holder if he causes damage to another vehicle or structure on the road, and personal injury protection (or PIP), which pays for all the policy holder's medical expenses if he or his passengers are hurt in an accident. Pennsylvania drivers are also required to purchase PD and PIP, but unlike New Jersey, they must also have bodily injury liability (or BI), which covers for any injuries the policy holder causes to other persons on the road.
In both New Jersey and Pennsylvania, the PD liability requirement is $5,000 per accident. PIP coverage in Pennsylvania is $5,000 per person, per accident, while New Jersey requires $15,000. Pennsylvania requires BI liability with 15/30 limits, which include $15,000 in coverage if one person is injured and $30,000 if multiple injuries occur. If a New Jersey driver chooses the more expensive standard policy, the minimum BI limits are also 15/30.
No Fault and Tort States
New Jersey is a no-fault auto insurance state, which means that if you are involved in an auto accident, your insurer will cover your damages, regardless of which driver was at fault. Pennsylvania, on the other hand, is a tort or limited tort state, and drivers must choose one or the other when purchasing an insurance policy. With tort insurance, you can sue the other driver for any amount of damages regardless of the type of injury or amount. If you choose limited tort insurance, you can only sue in certain circumstances, and only for a limited amount.