Truckers in trouble: Oregon sues state over excessive taxes while New Jersey raises minimum insurance

Legislation for minimum insurance increase in New Jersey

On January 16th, the New Jersey State Legislature enacted a law requiring heavy trucks to maintain liability insurance of at least $1.5 million, doubling the current federal minimum of $750,000. This new legislation applies to commercial vehicles weighing over 26,000 pounds and covers bodily injury, death, and property damage.

The current Federal Motor Carrier Safety Administration (FMCSA) regulation, setting the amount at $75,000, has been in effect since 1985. In a 2022 report, the FMCSA concluded there was no justification for increasing this amount.

It has not yet been specified whether the law will apply only to New Jersey carriers or to all interstate carriers. Potential legal challenges have been warned if interstate carriers passing through or doing business in the state are subject to it. The law has faced strong opposition from commercial groups like the American Trucking Associations and the New Jersey Motor Truck Association.

Tracy Denora, Executive Director of the New Jersey Warehouse and Movers Association, anticipates the new law will likely result in a significant increase in insurance premiums. Representing an increase of $20,000 to $40,000 or more annually, equivalent to 20%, she warned this could lead to higher verdicts and settlements, particularly impacting small carriers.

The Truck Renting and Leasing Association expressed in a letter to Democrat Scutari last month that the FMCSA has set national standards based on studies showing that over 99% of accidents are covered by the $750,000 limit.