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The SAIP does not meet the state’s minimum requirements for car insurance and only provides limited medical coverage for treatment immediately after a car accident. It does not provide liability protection or comprehensive and collision coverage. Because of these limitations, MoneyGeek recommends buying a standard auto policy from an insurance provider instead.

Key Takeaways

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Dollar-a-day car insurance in New Jersey is for Medicaid recipients in specific programs who need medical-only coverage when driving.

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For $365 per year, it helps to cover immediate medical treatment after a car crash and provides a $10,000 death benefit if an insured person dies in the accident.

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The dollar-a-day policy does not meet New Jersey auto insurance requirements and does not provide liability protection or comprehensive and collision coverage.

What Is Dollar-a-Day Car Insurance in New Jersey?

One-dollar-a-day car insurance — also called the Special Automobile Insurance Policy (SAIP) — is a special program in New Jersey that is offered to people currently enrolled in the Federal Medicaid with Hospitalization program. The policy is for medical coverage only and provides the following benefits:

  • Emergency medical treatment immediately following a car accident.
  • Up to $250,000 for treatment of serious brain and spinal cord injuries resulting from the car accident.
  • A $10,000 death benefit if a covered person dies as a result of a car accident.

The Cost of Dollar-a-Day Car Insurance

It’s referred to as dollar-a-day car insurance because the cost is only $365 per year, or $1 per day. However, people able to pay the bill in full can get a $5 discount and pay only $360 for the year. The $365 cost is divided between two installments, with half due at the time of purchase.

What Are the Eligibility Requirements?

Most drivers in the state of NJ will not qualify for dollar-a-day car insurance. Here are the requirements to be eligible for this medical-only policy:

  • Current enrollment in the Federal Medicaid with Hospitalization program (not all programs are eligible).
  • Have a valid driver’s license and vehicle registration.
  • One car per policy is eligible, but other people in the household can be listed drivers as long as they are also on an eligible Medicaid program.
  • No existing car insurance policy.

If you’re unsure if you meet the eligibility requirements for dollar-a-day insurance, it’s best to speak with a licensed car insurance agent in New Jersey. They can verify your eligibility based on your Medicaid ID card number.

You are required to provide your current Medicaid ID card at each renewal to maintain the SAIP. If you are no longer enrolled during the policy term, you can remain on the policy but will not be eligible for renewal.

What Is Not Covered With Dollar-a-Day Insurance?

The one-dollar-a-day car insurance policy is for medical coverage only. It doesn’t cover the majority of expenses you would expect to be covered under a standard car insurance policy, like liability for the other driver. Even if you get a liability-only car insurance policy, which doesn’t provide comprehensive and collision coverage, you will have more protection under that car insurance plan than under a dollar-a-day car insurance policy in NJ.

Though full coverage car insurance is usually more expensive, comprehensive and collision coverage are vital if you can’t afford to pay out of pocket to have your damages fixed after a car accident. Shop around to find the cheapest full coverage options.

Liability-only or full coverage car insurance policies typically cover:

  • Another person’s injuries or damage to their property (liability coverage)
  • Damage to your car (comprehensive and collision coverage)

One-dollar-a-day car insurance in NJ doesn’t cover either of the above. It also doesn’t cover doctors’ visits and other outpatient treatments already covered by Medicaid.

Should You Buy Dollar-a-Day Car Insurance?

The target market for SAIP car insurance is low-income New Jersey Medicaid recipients who can’t afford a standard car insurance policy, and it should be considered a last resort. If you don’t have liability coverage in the state of New Jersey and are involved in an accident where someone has been injured, or their property has been damaged, you can be sued.

If a judgment is granted against you, your assets can be seized or your wages garnished (money deducted from your work paycheck or another income source). This is why it’s crucial for low-income families to have at least liability-only car insurance: to prevent serious financial loss and devastation.

Before committing to dollar-a-day car insurance, shop around to see if there are other cheap car insurance options available. Standard car insurance with liability-only coverage costs a small fraction more but provides more protection if you are involved in an accident.

MoneyGeek recommends a full coverage car insurance policy. While it’s more expensive, it offers significantly more coverage and protection, not only for the other drivers but for your car as well.

Cost of Liability-Only Car Insurance in New Jersey

Though the one-dollar-a-day car insurance sounds like an attractive price, the lack of coverage makes it a poor option for most NJ drivers. We compared the cost of liability-only car insurance in NJ for coverage at the state minimum level for an average driver who owns a 2010 Toyota Camry.

We found the cheapest car insurance costs from GEICO, at an average of $1.35 per day. For only 35 cents more per day, or $499 per year, you can get significantly more coverage and protection. The table below shows the average annual premiums of the cheapest car insurance companies in New Jersey that offer state-minimum liability-only coverage.

State-Minimum Liability-Only Coverage Costs in New Jersey
State-Minimum Liability Premium





New Jersey Manufacturers






Amica Mutual















State Farm





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Why a Standard Policy Is Probably a Better Option

In the state of New Jersey, you have options when it comes to car insurance policies. The standard auto policy offers the minimum liability requirements, but there is also a bare minimum, or basic, policy with less coverage than the standard policy.

There is no coverage for bodily injury liability with the basic policy, but there is an option for $10,000 in coverage for all persons injured in the accident. The standard policy offers a minimum of $15,000 per person and $30,000 per accident. For property damage liability, the basic policy provides just $5,000 per accident, whereas the standard policy provides a minimum of $5,000 with an option to increase to $100,000 or higher.

A standard liability-only car insurance policy is a better option for most given the small cost increase compared to one-dollar-a-day car insurance in NJ. Here are the benefits of standard liability-only car insurance:

  • Minimum bodily injury liability protection of $15,000 per person and $30,000 per accident. This coverage is not offered under the dollar-a-day program.
  • Minimum property damage liability protection of $5,000 per accident. This is also not offered under the one-dollar-a-day policy.
  • Personal injury protection with a minimum coverage of $15,000. This helps to cover medical expenses, rehabilitation, diagnostic procedures and future treatment resulting from the accident. The SAIP offers immediate medical treatment, but no further treatment is covered.
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Find the best and cheapest car insurance rates for a standard policy by shopping around with multiple auto insurance companies. Pick the one with the best coverage for the lowest price to protect yourself and your family.

If You Can Afford It, a Full Coverage Policy Is the Best Protection

There’s no denying that car insurance in New Jersey isn’t exactly cheap, with the average cost around $1,000 per year for full coverage insurance. But if you can afford it, the financial protection it provides for families is worth it. Full coverage car insurance offers valuable protection for other vehicles, but also your own.

Who needs full coverage car insurance? New Jersey residents who own an expensive car, who can’t afford to fix or replace their vehicle or who can’t afford to pay out of pocket for bodily injury and property damage liability claims. By shopping around, you can find affordable car insurance to protect your assets without putting a large dent in your budget.

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How To Get Dollar-a-Day Insurance

If you’re looking to purchase one-dollar-a-day car insurance in NJ, you have two options:

  • Purchase through a licensed insurance broker offering this type of car insurance policy. There are no additional fees to purchase through a broker.
  • Contact the Personal Automobile Insurance Plan (PAIP) New Jersey office at 1-800-652-2471 to buy dollar-a-day insurance coverage.

To apply, have your driver’s license and Medicaid insurance ID card available. If there are other drivers, you will need their licenses and ID cards too.

Eligibility requirements may change over time, so it’s a good idea to confirm them before applying. You can visit New Jersey’s Special Automobile Insurance Policy (SAIP) website to view enrollment requirements.

FAQs About Dollar-a-Day Insurance

Do you still have questions about SAIP? Here are the answers to some of the most frequently asked questions about dollar-a-day insurance in New Jersey.

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About Mandy Sleight, Licensed Insurance Agent

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Mandy Sleight is a licensed insurance agent and has worked in the industry since 2005. She has her property, casualty, life and health licenses. Mandy has worked for well-known insurance companies like State Farm and Nationwide Insurance, and most recently as the Operations Coordinator for a startup employee benefits company.

Mandy earned her Bachelor of Science degree in Business Administration and Management from the University of Baltimore and her Master of Business Administration from Southern New Hampshire University. She uses her vast knowledge of the insurance industry and personal finance combined with her writing background to create easy-to-understand and engaging content to help readers make smarter choices with their budgets and finances.