Key Takeaways
- New Jersey uses modified comparative negligence where a plaintiff more than 50% at fault cannot recover
- Commercial general liability policies in New Jersey must comply with filed rates
- New Jersey has joint and several liability for economic damages but several liability for non-economic damages
- Professional liability requirements vary by profession and licensing board
- Pollution liability has specific requirements in New Jersey
Last updated: January 2026
New Jersey General Liability Insurance
New Jersey has specific requirements for general liability insurance that agents must understand.
Comparative Negligence
New Jersey uses a modified comparative negligence system:
How It Works
- Plaintiff can recover only if 50% or less at fault
- If plaintiff is more than 50% at fault, no recovery
- Damages reduced by percentage of fault
- Applies in personal injury and property damage cases
Example
| Plaintiff Fault | Can Recover? | Reduction |
|---|---|---|
| 30% | Yes | Reduced by 30% |
| 50% | Yes | Reduced by 50% |
| 51% | No | Cannot recover |
| 70% | No | Cannot recover |
Exam Tip: Remember New Jersey uses the "50% bar rule" - if you're more than 50% at fault, you recover nothing.
Joint and Several Liability
New Jersey has modified joint and several liability rules:
New Jersey Rule
| Damage Type | Liability Rule |
|---|---|
| Economic Damages | Joint and several (each defendant liable for full amount) |
| Non-Economic Damages | Several only (each defendant liable for their share only) |
Economic vs. Non-Economic Damages
| Economic | Non-Economic |
|---|---|
| Medical bills | Pain and suffering |
| Lost wages | Emotional distress |
| Property repair | Loss of enjoyment of life |
| Future earnings | Consortium |
Commercial General Liability (CGL)
New Jersey CGL policies must comply with state requirements:
Required Elements
- Occurrence vs. claims-made coverage clearly disclosed
- Coverage territory defined
- Limits per occurrence and aggregate
- Defense costs inclusion/exclusion
- Pollution exclusion with disclosure
Professional Liability
New Jersey requires or regulates professional liability for various professions:
State-Mandated Coverage
| Profession | Requirement |
|---|---|
| Attorneys | Not mandatory, but disclosure if no coverage |
| Architects | E&O may be required for certain projects |
| Engineers | E&O may be required for certain projects |
| Insurance Producers | Not mandatory but recommended |
| Real Estate Agents | Not mandatory but recommended |
| Healthcare Providers | Medical malpractice coverage varies by type |
Professional Standards
- Professional liability policies are typically claims-made
- Tail coverage important when changing insurers
- Prior acts coverage should be addressed
- Appropriate limits based on exposure
Pollution Liability
New Jersey has specific pollution liability requirements:
Environmental Laws
- New Jersey Spill Compensation and Control Act
- Industrial Site Recovery Act (ISRA)
- Underground storage tank regulations
- Strict liability for environmental contamination
Coverage Considerations
- Standard CGL pollution exclusion applies
- Separate environmental impairment liability may be needed
- Site-specific coverage available
- Remediation costs can be substantial in NJ
Umbrella and Excess Liability
- Provides coverage above underlying limits
- Common for both personal and commercial risks
- Must follow form or provide specified coverage
- Drop-down provisions for exhausted underlying limits
Test Your Knowledge
Under New Jersey's modified comparative negligence system, what happens if a plaintiff is found 55% at fault?
A
B
C
D
Test Your Knowledge
In New Jersey, for which type of damages does joint and several liability apply?
A
B
C
D