What is the special automotive policy?

In 2003, the Legislature created the “special” policy to enable certain qualifying low-income individuals to comply with the mandatory insurance laws. The policy is available to those eligible for and enrolled in Medicaid.

A “special policy” must provide:

  • Emergency medical coverage, up to $250,000, for the benefit of the named insured and dependent resident family members, and occupants and permissive users of the insured vehicle.
  • A $10,000 death benefit.

Emergency medical care includes all medically necessary care immediately following an accident, up to the time of discharge from acute care. Medical care within 120 hours of an accident that is initiated at a hospital is presumed covered. In addition, coverage is provided for both emergent and follow-up care for catastrophic or life-threatening injuries. No other routine or follow-up care is covered.

All special policyholders and their resident dependents are subject to the lawsuit limitation. N.J.S.A. 39:6A-3.3(b)(3).

No liability collision, comprehensive, uninsured or underinsured coverage may be offered in a special policy. N.J.S.A. 39:6A-3.3(c).

Special policyholders are by statute deemed to be “uninsured.” N.J.S.A. 17:28-1.1(a)(2)(d). Accordingly, a plaintiff injured by a special policyholder immediately may resort to available uninsured benefits.

Election of a special policy must be in writing and contain a statement that the policy covers only emergency medical care, and that election of special insurance may subject the insured to an uncovered claim for damages with respect to which the carrier has no duty to provide legal counsel, and that may place the insured’s assets at risk. N.J.S.A. 39:6A-3.2.

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