The Garden State Increases Minimum Trucking Liability Insurance Limits to $1.5 Million

trucking liability insurance

Two years ago, New Jersey introduced legislation to raise its minimum Trucking Liability insurance limits to $1.5 million, double the current FMCSA requirement of $750,000. The state law was approved and signed by Governor Phil Murphy in January 2024. The increased minimum trucking liability insurance requirements will take effect July 1, 2024, and apply to commercial vehicles in excess of 26,000 lbs. Insurance premiums for the additional coverage could increase significantly.

The law has faced strong opposition from trade groups such as American Trucking Associations (ATA), the New Jersey Motor Truck Association, the Truck Renting and Leasing Association (TRALA), and the New Jersey Warehouse and Movers Association.

Does the New Law Apply to Intrastate and Interstate Trucking?

It’s unclear whether the law applies only to trucks operating within New Jersey or also to those engaged in interstate commerce. According to the legislation, the law applies to vehicles “registered or principally garaged in this State.” However, according to an article in FreightWaves, the International Registration Plan (IRP), which operates as a compact among all the states, “permits vehicles that travel in two or more states to register with one state and then extend permission to operate into other jurisdictions, after a registration fee is paid and the funds allocated to the other states.” 

For example, a truck registered in New York could, through the IRP, also be technically registered in Connecticut, Pennsylvania, and New Jersey. If this is the case, will the New York truck be seen as registered in New Jersey and fall under the new insurance requirement?

According to the FreightWaves article, it’s important to note that rules within interstate compacts could challenge the state’s potential inclusion of IRP-registered vehicles. The ATA has also criticized the new rule as “bad policy,” warning that it could result in a legal challenge if interstate truckers driving through or conducting business in the state were subject to it.

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