What Is Dollar A Day Insurance In New Jersey?

What Is Dollar A Day Insurance In New Jersey?

At times, we have car accident clients that have Dollar A Day insurance in New Jersey. This is a type of auto insurance coverage available to certain New Jersey residents. The actual name for this insurance program is the Special Automobile Insurance Policy (SAIP). Our clients often do not realize how limited this type of insurance is when it comes to protecting them.

People who own a vehicle in New Jersey are required to have car insurance. The SAIP is a type of policy offered to give an affordable insurance option for those who are already receiving Medicaid. 

Anyone considering dollar a day insurance should be very cautious as to whether this insurance will adequately protect you and your family. It will not provide any money to defend you if you cause an accident and are sued by another person. It will not pay for any vehicle damage caused by you to another vehicle. It will not pay to fix damage to your own car. This simple policy will not pay money to defend you against another person's lawsuit if you injure anyone else. Also, this policy will significantly limit your ability to sue someone else if you are injured in a car accident unless specific types of injuries are sustained.

How can I get Dollar A Day insurance?

If you are interested in getting this type of limited insurance you will have to contact an insurance company or insurance agent. These are car policies issued through insurance companies. They just have more limited coverage.

This insurance program is available only to those New Jersey residents who are eligible for Federal Medicaid with hospitalization. The cost of this auto insurance is $365 for the year. This is why it is often referred to as Dollar A Day insurance.

If a person applies for the SAIP, that person must show they are enrolled in Medicaid when the policy is first written and each time the policy is renewed. If the insured is no longer enrolled in Medicaid during the policy term the policy will not cancel. However, the insured will receive only the limited benefits of the policy. This insurance is not available to those whose driver’s license is revoked or suspended.

Dollar A Day insurance provides limited medical coverage

While this coverage is more affordable than other options, it has some significant limitations. First, this policy provides limited medical coverage. Emergency room treatment immediately following an accident is covered. However, additional medical treatment is not covered unless the person has suffered serious brain and spinal cord injuries. If so, then there is medical coverage up to $250,000.

Dollar A Day insurance also provides a $10,000 death benefit.

If a person that has Dollar A Day insurance does not suffer a serious brain and spinal cord injury, then ongoing treatment, such as doctor visits or physical therapy, will likely not be covered by this type of auto insurance. In this situation, injured people with Dollar A Day insurance often try to get treatment paid through their Medicaid coverage. 

Dollar A Day insurance does not provide liability coverage

Another significant issue with Dollar A Day insurance is that it does not provide liability coverage. This means that this insurance does not pay money if the insured driver injures someone else. Typically, an insurance company will hire an attorney to defend its insured if its insured driver causes a car accident. The insurance company will also pay a certain amount of money under the policy for claims made by anyone injured in an accident.

Dollar A Day insurance policies do not do this. If a driver with Dollar A Day insurance causes an accident and injures another person, the insurance company will not hire a lawyer. The insurance company will not provide any money to settle any claims brought by the other injured person. The driver with Dollar A Day insurance would be personally responsible for any damages caused to the other person.

The economic reality is that many people who have Dollar A Day insurance simply do not have the money to pay a judgment themselves. As a result, many attorneys simply won't bring a lawsuit for significant damages through the court system. Because there is no insurance available through the Dollar A Day policy, the insurance company won't pay any judgement won at court. Also, even if an injured person brings a lawsuit and gets a judgment because it is unlikely they will ever be able to recover a judgment against a driver who is on Medicaid or who has limited finances.

Dollar A Day insurance does not cover property damage

Dollar A Day insurance policies do not provide collision coverage. This means that this insurance does not provide any money to repair the driver’s car if it is damaged in a collision. This policy also will not pay for the damage caused by an insured driver to another vehicle. The driver would then be personally responsible for paying the property damage to any other vehicle that he or she hits and damages.

While this insurance coverage is more affordable than other coverage, it should be used only by those that have no other option. This insurance is so minimal that it should be used only by those with limited financial resources. Other policies can provide more coverage for medical treatment, liability coverage to protect a driver if that driver injures another person, and collision coverage to repair a driver’s car if it is damaged.

For more information on the SAIP or Dollar A Day insurance in New Jersey, see the website for the State of New Jersey Department of Banking & Insurance.

If you or a family member have been involved in a car accident in New Jersey, contact the New Jersey personal injury firm of Mattiacci Law, LLC. Attorney John Mattiacci has extensive experience handling car accident cases throughout New Jersey. Contact us today for a free consultation. 

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