Dollar A Day Insurance (New Jersey SAIP)

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 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.

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.

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.

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.

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.

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.

In 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.

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.

In this page, we explored New Jersey’s dollar-a-day car insurance program, which provides minimal medical coverage for Medicaid recipients at a low cost. While this program can help those unable to afford standard insurance, it leaves you unprotected against liability, collision or comprehensive claims and doesn’t meet state insurance requirements.

If possible, consider a liability-only policy, which offers far more protection for just a modest cost increase — often as low as $1.35 per day. Use our tools to compare affordable options and find the right policy for your needs.

Here are the answers to some of the most frequently asked questions about dollar-a-day insurance in New Jersey.

Why Trust MoneyGeek? 

MoneyGeek conducted a study and gathered data from Quadrant Information Services and state insurance departments using various profiles and geographic locations to showcase how critical it is to compare car insurance rates when shopping for a policy — as rates for the same individual profile can differ greatly across insurance companies.

Sample Driver Profile

We used a sample driver profile with the following attributes to determine average car insurance rates in New Jersey:

• 40-year-old male
• 2012 Toyota Camry LE
• Clean driving record
• 12,000 miles driven annually

We modified this driver profile by age, vehicle, credit score and driving record to determine averages for different driver profiles and needs.

Coverage Levels and Deductibles

Unless otherwise noted, average rates on this page are for a full coverage policy with comprehensive and collision coverage, a $1,000 deductible for each and the following liability limits (100/300/100):

• $100,000 in bodily injury liability per person
• $300,000 in bodily injury liability per accident
• $100,000 in property damage liability per accident

When minimum coverage is specified, we used the following minimum liability-only limits as mandated by New Jersey:

• $25,000 in bodily injury liability per person
• $50,000 in bodily injury liability per accident
• $25,000 in property damage liability per accident
• $15,000 in personal injury protection (PIP) per person

Learn more about MoneyGeek's car insurance methodology.