Health Insurance Premiums Surge in New Jersey as Auto Rates Ease

A double-digit year for health coverage

New Jersey households are heading into another expensive year for health coverage, while their other insurance bills are moving in mixed directions. The sharpest increases are in health insurance. Carriers in the state's individual market have asked for an average increase of 20.4% for 2027. Horizon Blue Cross Blue Shield of New Jersey requested the smallest rise at 15.4%, and UnitedHealthcare the largest at 35.7%.11 These requests follow a final average increase of 16.6% for 2026. Small-employer plans are seeking 18.3% on average.11 Final 2027 individual-market rates are expected in late October. Last year, the state posted its finals on October 27.11

The New Jersey numbers are higher than the national picture. Across states, the median proposed increase in the individual market is about 15%, and the weighted average in states that have already finalized rates is also about 15%.13 National coverage places New Jersey among the higher states, in the same range as Washington's approved 22.2% and Georgia's finalized 20.7%.16 Over two years, the increases add up. KFF estimates that if this year's requests hold, typical marketplace premiums will be more than a third higher than they were before 2026. For most of the previous decade, these premiums had barely moved.16

Why the individual market is taking the hardest hit

The reporting points to two forces working together. One is the long-running rise in medical costs. Hospital and drug prices, labor costs, greater use of services, and spending on GLP-1 medications are all named as major drivers.13 The other is policy. The enhanced federal premium tax credits created in 2021 expired at the end of 2025 and were not extended. That brings back the subsidy cliff: households earning more than 400% of the federal poverty level get no federal help at all.11

New Jersey's market already shows the effect. Open enrollment for 2026 signed up 509,192 people, but enrollment had fallen to 434,700 by June 30, 2026, a loss of more than 74,000 in five months. The state blames the expired federal credits.11 Insurers price for the people who remain. When healthier, more price-sensitive buyers leave, the remaining pool costs more to cover. In our reading, that feedback loop is the most important context for the 2027 filings.

State regulators can do little about it. New Jersey's Department of Banking and Insurance does not have prior-approval authority over individual-market rates. It checks filings for compliance and cannot negotiate them down the way New York's regulator can.11 The state does keep its own subsidy program, New Jersey Health Plan Savings, for households up to 600% of the poverty level. Between 400% and 600%, however, the help is described as modest and not a replacement for the lost federal credit.11

The carrier-level filings also show how unstable pricing has become. Oscar had the smallest increase for 2026, at 4.6%, and is now asking for 29.3%. Horizon has the largest membership and is asking for the smallest increase.11 For people shopping during the November 1 to January 31 enrollment window, last year's cheapest plan may not be this year's.11

Public employees: a 34% increase and a shrinking risk pool

The most dramatic local number comes from the public sector. On September 25, the School Employees' Health Benefits Commission voted 4-2 to raise premiums for active workers by an average of about 34.4% in 2027.1420 The program covers roughly 300,000 employees, retirees and dependents across 212 school districts and county colleges.15 The increase varies by plan. Premiums for the PPO10 and PPO15 plans rise 45.1%, the New Jersey Educators Health Plan 31.6%, and the Garden State Health Plan 32.2%.17 Retirees face much smaller increases: about 11% for early retirees and 6% for Medicare-eligible retirees.1819

Outlets disagree slightly on one detail. Some put the loans the program must repay to the state at roughly $90 million.1418 Others cite a $70 million transfer, based on the approved actuarial analysis.1517 The overall conclusion is the same in every account: the rate is meant to cover projected claims, repay borrowed money, and rebuild reserves.14 Even so, reserves would cover only one month of claims by the end of 2027, short of the two-month target. Meeting that target would have required an increase closer to 40%.1718

The state's actuaries cite falling enrollment, GLP-1 drugs and revenue shortfalls among the causes.19 Districts with cheaper claims have been leaving the plan. The ones that stay tend to cover older, sicker employees, and officials have described the result as a "death spiral."15 The vote came only after repeated deadlocks and a state memo warning that the program would not be available as of January 1, 2027, if rates were not approved.19 The New Jersey Education Association called the increase "simply unacceptable."12 Union commissioners warned that it could push more districts out and force a mid-year increase.20 Because a 2020 law limits employee contributions, districts will carry most of the cost, and the union argues that money will come out of classrooms.18 Nearly every account notes that state workers got relief from Gov. Mikie Sherrill's administration on 2027 contribution rates, while school employees did not.14

We read this as the same problem the individual market has, on a bigger scale: when a voluntary insurance pool loses its healthiest members, the people left behind pay more.

Employer plans are rising too

People with coverage through a private employer are not exempt. KFF's benchmark survey found that average family premiums for employer coverage rose 6% in 2025, to $26,993. Workers paid $6,850 of that directly.4 It was the first time in two decades that family premiums rose 6% or more three years in a row.4 Health benefits consultancy Marsh expects private employer plans to rise 8.2% on average next year, the biggest increase since 2003.12 KFF has also noted that deductibles are climbing. More than a third of covered workers now have an individual deductible of at least $2,000.7 KFF had already warned that higher cost trends could lead employers to cut benefits or shift more costs to workers.6

Auto insurance: relief, but from a high starting point

Car insurance is moving in the opposite direction. Nationally, the federal motor vehicle insurance price index fell 5.1% in the 12 months ending in August 2026, while overall consumer prices rose 3.4%.36 Private quote data shows a different trend. Insurify found average full-coverage premiums fell 6% in 2025, then rose 1% in the first half of 2026, and it expects increases in 32 states by year-end.33 Both measures are probably accurate. The federal index looks back over a full year that includes 2025's cuts, while quote data shows where prices are heading now.

New Jersey's numbers need context. Quotes in the state fell about 5% in the first half of 2026 and are on track to finish the year about 4% lower.33 That decline follows a 20% jump in 2025, the largest increase of any state that year.38 Insure.com's estimate for 2025 was an 18% rise.40 Higher minimum coverage requirements also took effect in 2026. The standard policy minimum went from 15/30/15 to 35/70/25.39 Estimates of the average full-coverage premium in New Jersey range from about $3,100 to $3,345 a year, depending on the methodology.3940 For New Jersey drivers, the current decline gives back only a small part of recent increases.

Home insurance: slowing nationally, losses still high in hot spots

Homeowners insurance is cooling nationally but varies widely by region. NerdWallet found premiums for a typical home rose 24% between early 2023 and early 2026, but only 4.6% in the most recent year. Rate filings this year show a median requested change of just 1%.21 Insurify reports a 12% increase in 2025, followed by 2.2% in the first half of 2026.25 Insurance.com's state data shows how quickly that can change in one place: average premiums in Massachusetts jumped 42.9% in a single year.27 Estimates of the national average premium also differ, from $2,564 to $2,872, again because of methodology.2127

Claims payouts explain most of these increases. State Farm said it paid $1.22 in claims and expenses for every $1 of premium in Illinois over three years, and it is raising rates there by nearly 8% again.23 California home insurers paid out $1.69 for every $1 they earned in 2025.24 Insurers keep raising prices when they pay out more than they collect, and severe weather is the main reason payouts have grown.2123

The bottom line

Across every line of coverage, insurers are matching premiums to the claims they expect. Auto and home insurers raised prices sharply earlier and are now leveling off. Health insurance is a different case. Costs keep rising, federal subsidies have ended, and the risk pools are shrinking, which puts New Jersey households and school budgets at the center of the next round of increases. The October rate finals will settle the exact numbers, but they are very likely to stay at double digits.