Motor vehicle collisions typically result in at least property damage, if not injuries. When people get hurt, they have to worry about both medical costs and lost wages. Thankfully, that is exactly why people carry motor vehicle insurance coverage.
If you are the one who caused the crash, you have protection from the liability that results if other people suffer losses. If you are not the one to blame for the crash, you can make a claim against the other driver’s insurance to cover your costs. Unfortunately, that means that you are largely dependent on someone else’s financial decisions for your protection after a collision.
What happens if the person who hits you only has a basic policy in New Jersey?
Basic policies offer minimal protection
Unfortunately, while basic policies exist to make driving accessible for new adults and working-class individuals who have few assets, these policies don’t cover nearly enough if a crash actually does occur. A basic policy covers less than half as much as a bare-minimum standard policy.
Drivers in New Jersey could potentially have just $5,000 in property damage coverage and $15,000 in personal injury protection (PIP) coverage. The basic policy doesn’t even require bodily injury liability coverage, although people can choose to add it.
You will be dependent on your own PIP coverage for any injuries you suffer if the other driver has a basic policy and did not add supplemental medical liability coverage. Additionally, that $5,000 worth of property damage coverage likely won’t be enough to fix your vehicle.
How your policy will help
Your no-fault PIP coverage will cover your medical costs and possibly related expenses. If you have a standard policy, you might have just $15,000 in PIP coverage, but you always have the option of expanding how much coverage you carry.
On that note, you could also consider adding underinsured motorist protection to your policy, as that extra insurance could make a big difference if you are dependent on the other driver’s coverage and their policy is very low.
You might also end up in court. When insurance won’t cover your costs, you may have very few options other than to take legal action against the person to blame for the crash. A personal injury lawsuit could result in the courts awarding you the full value of your losses that insurance would not cover.
Understanding what happens after a car crash caused by someone with mediocre insurance coverage will help you plan for your financial future.