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New Jersey drivers pay an average cost of $3,254 for full coverage car insurance and $1,413 for minimum coverage as of November 2025. These potential costs may put an undue financial burden on some New Jersey residents who have limited budgetary resources. For those individuals, there may be another option. NJ dollar-a-day insurance provides a minimum level of coverage for drivers who are also enrolled in federal Medicaid. As the name suggests, this coverage costs $365 annually, or one dollar a day.
The Special Automobile Insurance Policy (SAIP)
Special Automobile Insurance Policy (SAIP) is New Jersey’s state-run program that offers low-cost car insurance to New Jersey drivers who have Medicaid with hospitalization benefits. SAIP policies are commonly referred to as “dollar-a-day insurance” because the policies cost about $1 per day.
Dollar-a-day insurance is cheaper than traditional car insurance through a private insurer, but SAIP policies offer limited coverage and don’t meet New Jersey’s minimum car insurance requirements. Here is what’s included in an SAIP policy:
- Emergency medical treatment: Covers medical expenses if you get into an accident and need emergency treatment.
- Brain and spinal cord treatment: Offers coverage up to $250,000 if you get into an accident and need treatment for a brain or spinal cord injury.
- Death benefit: Includes a death benefit of $10,000 paid to your loved ones if you pass away in an accident.
This type of insurance does not include collision or comprehensive insurance, which covers damage to your vehicle. More importantly, it does not include liability coverage, which means if you cause an accident and damage someone else’s vehicle or property, you are responsible for paying for the repairs out of pocket.
Cost of dollar-a-day car insurance in New Jersey
SAIP insurance costs $365 per year, payable in biannual or annual installments. If paid annually, it lowers the cost to $360. There is no monthly payment option like traditional car insurance.
Keep in mind that only one car is eligible for coverage on an SAIP policy, although multiple people can be covered on a single policy. For example, if you and your partner both qualify for SAIP insurance and you each have a car, you would need to purchase two separate policies, which would double the cost. However, you could both be covered on the same policy if you share a single car.
Unlike traditional car insurance, there are no discounts for dollar-a-day insurance. Despite the Medicaid requirements, there are also no subsidization options for dollar-a-day car insurance. However, your rate won’t increase or decrease due to your ZIP code, age or the type of car you drive.
Dollar-a-day vs. standard auto insurance
The SAIP program is significantly less than the average cost of standard minimum insurance policies in New Jersey, which is $1,413 per year. Although the cost difference is substantial, these standard policies offer greater financial protection than the SAIP, and cutting back on coverage could cost a driver more in the long run.
SAIP insurance leaves drivers financially vulnerable by not covering many incidents a standard policy would provide coverage for, as it does not include liability coverage, collision coverage or comprehensive coverage.
Who is eligible for dollar-a-day insurance in NJ?
Dollar-a-day insurance in NJ may be worth considering if you are struggling to make ends meet and you are a Medicaid recipient. The cost of this coverage is considerably less than you are likely to pay if you have basic or standard car insurance policies. However, keep in mind that the coverage it provides is minimal and does not include the more extensive types of insurance that you may find in other policies. Many insurance experts would recommend that you consider it only if all other options are unavailable to you.
There is another possibility for some low-income drivers in the Garden State. It’s called the New Jersey Personal Automobile Insurance Plan, or NJPAIP. This type of insurance is best for those who are considered high-risk drivers. It costs more than SAIP coverage, but may be an affordable option for you if you have past violations on your driving record.
How to get dollar-a-day insurance in New Jersey
To qualify for dollar-a-day insurance in New Jersey, you must meet certain eligibility requirements, including:
- Be actively enrolled in Federal Medicaid with hospitalization.
- Have a valid New Jersey driver’s license and registered vehicle.
- Not have an existing auto insurance policy.
If you lose your Medicaid benefits, your SAIP car insurance will remain active with limited benefits until the renewal period, at which point you’ll need to find another policy. Additionally, drivers with suspended or revoked licenses or who have a car registration in bad standing are not eligible.
Drivers who meet eligibility criteria can apply for coverage at most insurance agencies in New Jersey. The SAIP website provides assistance for finding a provider, which is available online or at 1-800-652-2471.
Applicants will be asked to provide their driver’s license, car registration and Medicaid identification card, as well as the licenses of anyone in their household who also qualifies for Medicaid and drives the insured vehicle.
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