New Jersey Insurance Brief
Updated September 17, 2026
Practical updates for New Jersey drivers, employers, taxi operators, and school transportation contractors.
For New Jersey Drivers
2026 Automobile Liability Minimums Are Now In Effect
For standard New Jersey automobile policies issued or renewed on or after January 1, 2026, minimum bodily injury liability limits increased to $35,000 per person and $70,000 per accident. The minimum property damage limit remains $25,000. The State bulletin notes that these increases do not apply to New Jersey's Basic Policy.
What to do: Review your declarations page at renewal and consider whether the legal minimum provides enough protection for your household and assets.
School's Back: Slow Down In School Zones
The New Jersey Department of Labor launched a statewide safety campaign after three school crossing guards were killed and nine were injured during the past three years. Drivers are urged to obey reduced speed limits, put phones away, stop completely for crossing guards, never pass a stopped school bus, and watch carefully for children walking or bicycling.
What to do: Leave extra time, eliminate distractions, and be prepared to stop near schools, buses, crosswalks, and crossing guards. School transportation operators should reinforce these reminders with every driver.
For Businesses and Fleets
School Transportation Contractors: Confirm Insurance and Certificates
The New Jersey Department of Education requires anyone providing or subcontracting student transportation to maintain at least $1.5 million in automobile liability coverage for bodily injury and property damage. Certificates must name the appropriate school boards and coordinated transportation agencies as additional insureds. Individual school-board bid specifications may require higher limits—sometimes as much as a $5 million combined single limit (CSL).
What to do: Review the bid specifications, additional-insured names, vehicle inspections, driver records, and certificates before service begins or a contract renews.
Workers' Compensation Coverage Remains Mandatory for Most Employers
New Jersey generally requires employers to maintain workers' compensation insurance or obtain approval to self-insure. The State warns that failure to insure can bring penalties of up to $5,000 for the first ten days and up to $5,000 for each additional ten-day period, along with direct liability for employee benefits after an injury.
What to do: Avoid coverage lapses, keep the required workplace notice posted, and report work injuries to the carrier promptly.
Employee or Independent Contractor? New Jersey's ABC Test
Worker classification can affect labor-law and workers' compensation obligations. Receiving a 1099 instead of a W-2 does not, by itself, establish independent-contractor status. Under New Jersey's Unemployment Compensation Law, a worker is considered an employee unless all three parts of the ABC test are satisfied.
Part A: Freedom From Direction or Control
The worker must be, and remain, free from the employer's control or direction over the work under both the contract and the actual working relationship. Direction or control can include:
- Giving instructions or training
- Setting work hours
- Specifying tools, supplies, or assistants
- Defining responsibilities or the sequence of work
- Having the right to fire the worker
If the employer exercises direction or control, Part A cannot be met.
Part B: Work Outside the Usual Business or Place of Business
The work must either be outside the employer's usual course of business or be performed outside all of the employer's places of business.
- A fence installer working at a law office performs a service outside the law firm's usual business; a paralegal assisting its lawyers does not.
- Facilities where physical or occupational therapists perform services through staffing contracts may be considered integral parts of the staffing business.
If the work is similar to the employer's usual business or is performed where that business ordinarily operates, Part B cannot be met.
Part C: Independently Established Business
The worker must customarily operate an independently established trade, occupation, profession, or business that can continue separately from the relationship with the employer. Relevant factors include:
- The amount and duration of work for the current employer
- Whether the worker employs others and pays their own expenses
- Whether the worker serves more than one person or firm
- Whether the worker uses their own tools, equipment, vehicles, or materials
- The number and volume of other customers
- How much work comes from the current employer compared with other customers for the same services
If a worker is misclassified: New Jersey remedies may include backpay and reimbursement for unlawful deductions, access to employment protections and benefits, a penalty of up to 5% of the worker's gross earnings during the prior 12 months, and correction of retaliatory actions. Employers should disclose employees and subcontracted labor accurately to their insurance agent or carrier and retain records supporting any independent-contractor classification.
Expanded Job-Protected Leave Requirements Are Now In Effect
Effective July 17, 2026, employees receiving New Jersey Temporary Disability or Family Leave Insurance benefits may have job protection when their leave is not already covered by the New Jersey Family Leave Act. This protection has no minimum employer-size or employee-work-history requirement. NJFLA coverage also expanded to employers with at least 15 employees, while employee eligibility was reduced to three months of employment and 250 hours worked during the preceding 12 months.
What to do: Review leave and reinstatement procedures, train managers to route requests promptly, and consult an employment professional before denying protected leave or reinstatement. Review employment-practices liability coverage, but remember that insurance does not replace legal compliance.
Upcoming Business Resources
Free Small Business Resource Fair In Newark On September 22, 2026
The New Jersey Economic Development Authority and its State and federal partners will hold a free resource fair on Tuesday, September 22, from 9:00 a.m. to noon at the NJIT Campus Center, 150 Bleeker Street in Newark. Business owners can get help identifying grants and loans, preparing for financing, registering a business, and pursuing woman-, minority-, or veteran-owned business certifications.
What to do: Review the official NJEDA announcement and register in advance. Free parking is available at the NJIT Parking Deck at 154 Summit Street.
Legislative Watch
A3396 Proposes a Lower Liability Minimum for Autocabs
Assembly Bill A3396 proposes reducing the minimum motor vehicle liability coverage required for autocabs from $1.5 million to $200,000. This is proposed legislation and does not itself change the current insurance requirement.
What to do: Taxi owners should continue meeting existing requirements and contract terms unless a change is enacted and becomes effective.