Insurance is an agreement between a party and an insurance company in which the insured pays a premium to the insurer for protection against covered financial or property losses that may occur. There are various types of insurance available to residents of New Jersey, including health care, life, car, business, and home insurance. The New Jersey Department of Banking and Insurance (NJDOBI) regulates insurance rates and transactions in the state. When determining the cost of your insurance, the insurer will consider several factors, such as age, gender, location, risk exposure, and income level. In 2021, over $24,700,000 in direct premiums were written in New Jersey. The best way to save money on insurance is to consult a New Jersey-licensed insurance agent. You can find a qualified insurance agent via the Licensee Search page maintained by the New Jersey Department of Banking and Insurance.
You can save money on insurance in New Jersey through the following ways:
- Bundle your insurance policies: To save money on insurance, bundle different insurance policies and buy them from the same insurer instead of buying them separately. Bundling policies with the same insurer typically attracts insurance discounts. Bundling policies with the same insurer typically attracts insurance discounts. You can also bundle policies with family members if your insurer permits this.
- Shop around: When planning to purchase insurance in New Jersey, you should shop around and compare all the available options to help you pick the most suitable and affordable policy that fits your needs and budget. Contact New Jersey-licensed insurance agents to help shop around for affordable policies that suit your business needs.
- Licensed agent: One of the best ways to save money on insurance in New Jersey is to consult a licensed insurance agent who can help you save money on insurance. Agents typically have access to multiple insurers and can assist with shopping around for affordable quotes, looking for discounts, and handling the application process.
- Annual Policy Review: The agent also helps review your policies before each renewal and ensure that you do not over-insure or under-insure based on your current needs. If the agent cannot find a better deal elsewhere on the market, you get affirmation that your existing policy is the best that you can currently get.
- Ask about special discounts: Most insurers offer different discounts on several insurance plans that can help you save money on insurance. Getting an insurance discount is a good step toward reducing your insurance rate. Some types of insurance discounts include:
- Multi-policy discount: If you purchase two or more insurance policies from the same insurer, like Auto and Home or a Business Property and Business Interruption coverages, you may be eligible for a multi-policy or bundling discount
- Policy renewal discount: All insurers want to retain you with their company and are ready to offer you discounts if you continue renewing your policy.
- Automatic policy discount: Many insurance companies operating in New Jersey reward you if you choose automatic payments using an electronic funds transfer (ETF) from your checking account or by setting up recurring payments using your debit card or credit card. Paying monthly by mail costs the insurer extra in labor and processing times.
- Employer-based discount: Some employers negotiate bulk insurance rates for their employees. If yours does, you can get a discount while you work there, but note that this discount might end when you stop working with the organization.
- Military&veteran discount: Many insurers offer military or veteran members discounts to honor those who serve. You may be offered an insurance discount if you are a military community member like the army.
- Raise your deductible: The higher your deductible, the lower your premium. However, higher deductibles translate to lower claim payouts, and you would have to pay a high deductible out of your savings before you get your claims payout in the event of a covered loss. Consider increasing your deductible only if you can afford high out-of-pocket payments.
- Risk Mitigation: This is one of the best ways to get car insurance lowered. Risk mitigation involves installing safety or anti-theft devices and actively mitigating potential risks.
- Group Insurance: You may get less expensive rates if you get insurance through societies or professional associations (such as employees of a particular employer) that you belong to. In most cases, policies purchased through this means cost less than when bought individually.
- Drop unnecessary coverage: In order to lower your cost of insurance, purchase only the necessary and important coverage you and your family needs.
Save on Insurance in NJ - 101
Insurance plans provide financial protection after a covered loss. However, to be protected, you must regularly pay a specified premium, which may be costly, depending on certain factors, like age, location, and risk exposure. To continue enjoying protection without paying a high premium rate, you can take several steps to save on your insurance, like:
- shopping around for affordable rates,
- looking for discounts,
- bundling your policies, and
- raising your deductible.
Most importantly, you should consult a New Jersey-licensed insurance agent for more information on how to save money on insurance based on your particular set of insurance needs.
How to Save Money on Health Insurance in New Jersey
Health insurance protects you from financial losses in emergencies that may lead to high medical costs. When you are on a health insurance plan, your visit to the hospital for routine medical check-ups, vaccines, and screenings will be typically covered within your policy limits. To save more money on health insurance, you can opt for a cost-sharing community to share the cost of medical expenses instead of buying an individual plan. The best way to find affordable health insurance and save money on insurance in New Jersey is to use the following tips:
- Shop for better insurance rates: When you want to buy health insurance, whether private health insurance, travel health insurance, or self-employed health insurance, it is essential to ask questions and shop around for multiple health insurance quotes. This will enable you to procure the best policy coverage that fits your budget and anticipated medical usage needs.
- Use Family Member's Plan: Your children or spouse can be added to your health insurance policy. You can opt for plans that cover your children, which is cheaper than having an individual plan for each of them. This is an excellent way to save money on your health insurance as you do not need to get a separate insurance plan for them. An average of 55% of health insurance in New Jersey is through group and employer provided plans.
- Review Your Insurance Plan Annually: In preparation for open enrollment (when you can change your employer-provided or Marketplace health insurance), you can reassess your health insurance plan based on your health insurance needs. Also, review new options to ensure you still have the best and most affordable health plan. For example, if you know that in the next year you have upcoming expensive medical procedures and surgeries - you may want to increase the coverage and pay a little more per month in exchange for lower out-of-pocket costs through deductibles, coinsurance and copays. After the surgeries are behind you, you can save money by raising back up the deductibles. (Always discuss your decision with qualified and state-licensed insurance professionals).
- Always negotiate medical bills: It may not seem like it, but many large hospital bills are negotiable. Many hospitals offer waivers, cash discounts, or relief plans. Make sure to call the billing department and ask if healthcare discounts are available or if they can waive any associated fees. It is not uncommon to save upwards of 30% on surgeries this way. Besides the possible reduction of the fees, the billing department will also be able to provide information about setting up a payment plan that typically does not involve interest.
- Maintain a healthy lifestyle: To lower your insurance and overall medical expenses, you should maintain a healthy lifestyle, like eating healthy, exercising regularly, getting enough sleep, and visiting the hospital for routine checkups to avoid unnecessary medical expenses, increasing your health insurance rate.
- Use in-network health care providers: In nearly all circumstances, you’ll save money by using physicians, clinics, and hospitals in your health care plan’s network. When you use in-network care, you can take advantage of your plan's relationship with certain care providers. These providers agree to lower fees on services in exchange for access to the plan’s network members.
- Use employer-sponsored health insurance: An excellent way to save on health insurance is to take advantage of your employer-sponsored health plan, if available. With this plan, you will only pay a fraction of the regular price of health insurance, and you will get coverage for your spouse and children.
- Use the HSA: If you pick a high deductible health plan (HDHP) you can get a Health Savings Account (HSA) that can help cover the costs of the high deductible, copays and other qualified medical expenses, if needed. Whatever you save by getting a lower cost HDHP health plan, can be put away into the HSA plan, up to an annual limit - so that it can be tapped into in case of a need. If you do not use your HSA, the saved untaxed money keeps accumulating tax-free, until you eventually use it - again, without paying taxes. HSA funds can be also used to invest for growth, also tax-free.
- Opt for a government-sponsored plan: Depending on your income level, you may be eligible for publicly-funded health insurance through Medicaid, Children's Health Insurance Program (CHIP), or NJ Family Care. If your income surpasses the income limit, you may still be able to get premium tax credits or cost-sharing subsidies to help pay for insurance purchased on the Get Covered NJ Marketplace.
Ask a health insurance agent licensed in New Jersey to help you compare multiple quotes on health insurance plans, to help you get the most suitable health plan for your needs - at the best price possible. In 2023, at least 6 health insurers offered affordable and frequently subsidized ACA health insurance on the individual health marketplace.
How to Save Money on Car Insurance Policy in New Jersey
All New Jersey drivers are required to carry proof of insurance. Failure to do so could result in suspension or fines. It is mandatory for all vehicles in the state to have three types of auto insurance coverage:
- Liability insurance
- Personal injury protection
- Uninsured motor vehicle insurance
In 2021, the residents of New Jersey had written over $8 billion in direct car insurance premiums for auto insurance. Likewise, nearly $2 billion in direct premiums were written for commercial auto insurance. In 2023, the average cost for auto insurance coverage in New Jersey was around $900 per year for just liability, and $1,700 - $1,900 for full coverage.
Here are some ways to save money on car insurance in New Jersey:
- Sourcing for discounts: Auto insurance companies typically offer discounts to residents with good driving history, no accident records, or low mileage. There is a high chance that an auto insurance company would offer a discount if there have been no claims on previous insurance policies and they deem your history suitable.
- Shop around for multiple car insurance rates: Before settling for a policy, shop around and get at least three car insurance quotes to compare rates between competing insurers. If one agent cannot provide competing quotes, speak with an independent agent who has access to multiple insurers.
- Bundle your home and car insurance policy: You may get a discount if you buy two or more insurance policies from the same company. When you bundle your car insurance with other coverages, like your homeowners or renters insurance policy, you save enough money on annual or monthly premiums to a large extent. Sometimes, you can save up to 15% or more on all your policies when you bundle your car and home insurance policies together. According To J.D. Power U.S. Household Insurance Study, around 80% of insurance consists of bundled policies.
- Drop unnecessary coverages: To avoid unnecessary insurance expenses, you can drop collision coverage on an old car that is not driven often. But be ready to pay to fix your car out of pocket, if you cause the accident and you have just the liability coverage.
- Install safety features: Some insurers offer discounts for vehicles with anti-lock brakes, airbags, passive restraint systems, anti-theft devices, and vehicle recovery systems. Taking risk mitigation measures to save on your car insurance by Adopting safe driving habits (like always using your seat belt, obeying traffic signs, driving within the speed limit, etc.) can also earn you a low car insurance cost.
- Safe driving: Another way to save money on car insurance is always to drive safely. Drivers who have been in accidents tend to have higher insurance premium costs. You can take the Defensive Driving course approved by the New Jersey Motor Vehicle Commission to help you with tips on safe driving. Taking the defensive driving course typically offers a 5 - 10 percent discount on New Jersey auto insurance, and if you had any points and moving violations on the license, the course allows you to remove 2 points from your record (once every 5 years).
- Low mileage discounts: Before you sign up for insurance, your insurer will ask you questions about your average vehicle mileage. Generally, the more you drive, the more you pay for insurance. Drivers in New Jersey who drive 7,500 miles or less yearly may get a discount on their auto insurance costs, saving $6 - $10 per month.
- Annual policy review with an agent: Ask your agent to check your options annually. The insurance market does not stagnate and insurers offer new more affordable plans all the time. If you do not check - you will never know if you could have saved on your car insurance.
Note: New Jersey residents who are enrolled in Federal Medicaid (with hospitalization) are eligible for the Special Automobile Insurance Policy (SAIP). SAIP does not provide property coverage. It provides coverage for emergency treatment up to $250,000 following an accident, and a $10,000 death benefit.
When considering how to save more money on auto insurance plans, speak with a New Jersey-licensed insurance agent. Also read through the Auto Insurance Purchasing Planner interactive guide to buying an auto insurance policy. Using the Planner, you can ask your insurance agent or auto insurers more specific questions about what coverage best fits you and your family and about ways to lower car insurance costs.
How to Save on Home Insurance in New Jersey
In New Jersey, residents face various weather-related risks throughout the year, such as storms, wind, and rain. Home insurance can help protect residents’ belongings against weather disasters, vandalism, burglary, and third-party liabilities. 64% of the population in New Jersey are homeowners. New Jersey’s homeownership rate is slightly below the national average at 65.8%. As much as homeowners need homeowners insurance, tenants also require renters insurance coverage and landlords require landlords insurance to protect their homes against insurable perils, including the damages caused by tenants.
You can lower the cost of the home, rental, and landlord insurance in New Jersey using the following tips:
- Bundle insurance policies: One of the simplest ways to save on homeowners insurance is to bundle policies with the same provider. For example, you may get lower rates by bundling renters or homeowners insurance with your auto insurance policy. It is common for home insurers to offer 10% to 15% to insureds when insureds bundle multiple policies (most often auto).
- Higher deductible: The higher you set your deductible, the lower the cost of your insurance. Most home insurance companies in New Jersey offer deductibles of between $500 and $1,000, but some home insurers only offer the deductible expressed as a percentage of the total dwelling coverage. Selecting a higher deductible would reduce your insurance annual premium but also require that you make higher out-of-pocket costs in the event of a covered peril. Make sure to set a deductible that you can afford to pay at any moment.
- Shop around for multiple rates: You should shop around to compare rates from different home insurance companies and pick the best deal. It is best to consult with an insurance agent to help you shop around for affordable home insurance quotes that are tailored to meet your home insurance needs. Speak with multiple agents if you need.
- Look out for discounts: You could save money on your home insurance if you can get discounts. Your insurer may offer a discount if you activate e-billing or automatic monthly payments. You may also get a nonsmoker discount, bundled policy discount, early signing discount, new home discount, smart home discount, no-claims discount, etc. Ask your insurance agent or the current insurer for more home insurance discounts you are eligible for to save on insurance.
- Protect Your Home: Keeping your home safe from dangerous events, like fire outbreaks and theft, can help you reduce the amount you will spend on purchasing insurance for your home. Even though some unforeseen circumstances are inevitable, taking specific measures to protect your home is essential to reduce your insurance cost. You can protect your home by installing safety devices like smoke detectors, alarm systems, sprinklers, fire extinguishers, and deadbolt locks to reduce the risk of fire outbreaks, theft, etc.
- Consult with an insurance agent: Consult with a knowledgeable and experienced home insurance agent who can help you find affordable homeowners, renters, condos, or landlords insurance policies that fit your needs, without overpaying for coverage you do not need.
- Conduct an annual review: Speak with your insurance agent annually, to check if better policies are available on the market. A knowledgeable New Jersey agent can make sure that your home is insured according to the current rebuild value, that you are not overpaying for the coverage, and that your liability needs are also met. The worst thing you can hear back after an annual review of the policy is that your current insurance policy is unbeatable based on the current market.
When contemplating how to save on home, rent, or landlord insurance, consult with a New Jersey insurance agent to guide you in making the best decision based on your specific needs.
How to Save Money on Life Insurance in New Jersey
The two main types of life insurance in New Jersey are term life insurance and permanent life insurance. With term life insurance, the insured’s beneficiaries will only receive the insured’s death benefit if the insured dies within the policy term. Permanent life insurance policies last for the insured’s lifetime (or for as long as the premium is made), while term life insurance policies only last for a limited period, generally between 5 and 30 years. Approximately 40 percent of life insurance policies are Term Life policies, with level term as the most common version. Types of permanent life insurance include whole life insurance, universal life insurance, variable life insurance, and final expense insurance.
Permanent life insurance is generally more expensive than term life insurance, so if your goal is to get the death benefit at the lowest cost and you medically qualify, your best bet to save money on your life insurance is through a term life insurance policy. However, permanent life insurance may be the best fit for you if you want to build cash value alongside the death benefit that life insurance guarantees.
You can apply the following tips to save money on your life insurance policy in New Jersey:
- Shop around to get a reasonable rate: To save on life insurance, it is advisable to shop for quotes from multiple life insurance companies offering policies in New Jersey and compare the benefits and rates. You can choose the most affordable policy after comparing the benefits and options the insurers offer.
- Pay premiums annually: Life insurance companies offer various payment options, including annual, monthly, or quarterly payments. Making monthly payments is the best option if you want to save money. Although paying monthly may seem more straightforward to fit into your budget, it is typically a more expensive option than annual payments.
- Buy only the coverage you need: Life insurance premiums are calculated based on several factors, like health, age, gender, policy type, and the amount of death benefit coverage. The more coverage you buy, the more you'll pay, depending on the policy type. It is vital to determine exactly how much death benefit you need so you don’t buy more than you need. For example, if you are single, do not own a home, or have any dependents, you can get a term life or final life expense policy to cover burial costs and other final life expenses.
- Maintain a healthy lifestyle: One of the easiest ways to keep your life insurance costs low is by maintaining a healthy lifestyle. Exercising more, eating healthy, and quitting smoking/drinking and dangerous hobbies can all go a long way in helping you save on life insurance coverage because these measures may attract specific discounts. Smokers typically pay 2-3 times for life insurance coverage, compared with non-smokers.
- Buy life insurance at a young age: Life insurance companies mainly consider the insured’s age when deciding on the premium to charge. People generally become more susceptible to health challenges that could shorten their lifespan as they grow older, which is why life insurers charge higher for older persons. For example, at 30 years old you may pay around $30 - $40 per month for a $500,000 term life policy, while the same coverage will cost $50 - $60 when you are 40, and over $100 - $120 when you are over 50. Therefore, getting a life insurance policy at a young age is an excellent way to save money.
Consult with a New Jersey-licensed life insurance agent to help you compare life insurance quotes and get you a cost-effective insurance plan.
How to Save Money on Business Insurance in New Jersey
Business insurance is also known as commercial insurance in New Jersey. Business owners are exposed to financial losses due to business hazards, fire outbreaks, floods, property theft, and liability lawsuits that typically disrupt business operations. This is why businesses need commercial insurance policies that suit their needs, like business liability insurance, business interruption insurance, commercial property insurance, and business hazard insurance. A business policy is not required by New Jersey law, but if you have at least one employee, you must have workers' compensation insurance. How much you pay for your coverage depends on the business insurance you get. It is essential to evaluate your business needs and determine the coverage you need to avoid spending more than what is required for your business. Some tips to save money on business insurance in New Jersey are:
- Shop around: Business insurance costs vary by insurer, so it is crucial to compare rates from multiple insurance companies to get the most suitable and affordable policy. Speak to more than one agent to get multiple perspectives.
- Work with a New Jersey-licensed insurance agent: An insurance agent can help assess your business insurance needs and determine the policies your business needs. They can also help you get discounts that will help you save money on your insurance policy. When working with an insurance agent, you must inform them about any significant changes in your business, such as hiring more employees, expansion, or location change. Also, get your agent's advice for disaster planning. Ask what you can do to reduce risks of fire or work-related accidents, as well as the procedures that should be in place in case your business does suffer a major disaster. Having the right coverage and a well-thought-out disaster plan can save you money on your insurance in the long run.
- Ask for discounts: Some business insurance companies offer commercial insurance discounts like loyalty discounts, multi-policy discounts, no-claims discounts, bundling discounts, etc. You can ask your insurer for potential discounts you are eligible for.
- Ask about ways to prevent losses: You can reduce your premium rate for certain coverages by following your insurance company's recommendations on how to prevent losses. These can include workplace safety, disaster preparation, and human resource intervention.
- Risk mitigation: Risk mitigation is an excellent way to save money on your business insurance policy because it increases your chances of staying claims-free and protects your business. Apart from reducing your insurance cost over time, risk mitigation also attracts discounts. You can adopt safety measures, such as having an effective workplace safety plan. You can also install safety devices to reduce your risk.
- Higher deductible: The higher you set your deductible, the lower the cost of your business insurance. If you choose a higher deductible, your insurance premium would be cheaper, but the implication is that the business would have to pay higher out-of-pocket costs in the event of a covered peril. This amount should be set aside and ready to be spent at a moment's notice.
- Make a larger down payment: If premium financing is used to pay for commercial insurance policy, making a larger down payment can save you money, because you will be paying interest on a smaller loan.
The Small Business Health Options Program (SHOP) helps small business owners with 1–50 employees to provide private health insurance to their employees. It is typically the only way employers can get the Small Business Health Insurance Care Tax Credit, to save eligible employers up to 50% of their contribution. To enroll the New Jersey business through SHOP, you can get the plan directly through an insurance company or get help from a SHOP-registered agent or broker.
Can you Negotiate the Price of Insurance in New Jersey?
You cannot negotiate the price of insurance in New Jersey. Insurance companies must abide by their internal pricing structure and state regulations on insurance rates required by the New Jersey Department of Banking and Insurance. It is illegal for insurers to offer deals other than recognized rates. Compare quotes from different insurance providers to get the most affordable insurance coverage rates.
Always discuss your insurance decisions with a state-licensed and knowledgeable New Jersey insurance agent.