N.J. Commissioner Launches Last Chance Program

New Jersey Insurance Commissioner Holly Bakke announced the launch of the “Last Chance” program as a way for uninsured motorists to obtain coverage without having to pay all of the surcharges usually levied for such policies.

Under the program, uninsured motorists can save between $115 and $1,300, but they must buy coverage through the Personal Automobile Insurance Plan (NJ-PAIP). “Last Chance” waives underwriting surcharges for being uninsured only; all surcharges for other violations and at-fault accidents and surcharges imposed by the Division of Motor Vehicles still apply.

Persons eligible for the program are those who must buy auto insurance through NJ-PAIP for one of two reasons: They have a conviction for driving uninsured, or they were canceled for not paying their premium and have been without coverage more than 30 days. Participants cannot cancel an existing policy to get into the program.

Those who have a conviction for driving uninsured must still pay court costs and complete any court-imposed suspension of their driver’s license. Also, those who take advantage of “Last Chance” must separately show DMV that they have obtained coverage to avoid cancellation of their vehicle registration.

Motorists can buy either a Standard Policy or a Basic Policy through NJ-PAIP. Under the Basic Policy, drivers opting for “bare bones” liability coverage would save either $115, or $1,035 if they had received a conviction. (Collision and comprehensive coverage can be added to a Basic Policy at a higher cost, with additional surcharges waived.)

Commissioner Bakke noted that New Jersey’s Basic Policy could be an appropriate, low-cost option for drivers with few family obligations or assets to protect. The Basic Policy, created by the Legislature in 1998, offers minimal liability coverage and $15,000 in medical benefits at a cost hundreds of dollars below that of Standard Policy.

A sheet outlining the differences between New Jersey’s Basic and Standard Policies is attached. Information is also available on the Department’s Web site, www.njdobi.org.