Magdalena Padilla, vice president for the Insurance Council of New Jersey, based in Ewing, N.J., a carrier association, said the general consensus among insurers is that anything that helps to eliminate uninsured drivers is a "step in the right direction." Because of the very limited amount of coverage, however, she said drivers would be faced with a challenging decision over whether the policy suited their needs.

"The dollar-a-day policy is very, very basic, very minimal," observed Ms. Padilla. "Whether its right for everybody [who qualifies] is something only the individual driver can decide, but it is certainly better than driving around uninsured."

Under the plan, only drivers who receive Medicaid would be eligible to purchase a policy to cover $15,000 worth of emergency room services and $250,000 of medical coverage if the driver suffers a catastrophic injury. Medicaid covers nonemergency services. The policies cost $360 a year, if paid in one lump sum, or $365 if purchased in two six-month installments. The policy also provides a $10,000 death benefit.

The insurance is sold through the Personal Auto Insurance Plan, the state's residual market for automobile insurance.

The N.J. Department of Banking and Insurance said the forms were approved on Oct. 1, and about a dozen plans were sold during a test period.

The department said a portion of each dollar-a-day premium would go to a fund to compensate drivers injured by uninsured motorists.

On another front that would affect insurers and motorists alike, the state is looking at approving regulations dealing with counterfeit insurance cards.

Under the proposed rules, the state would allow companies to employ anti-counterfeiting methods and produce cards that would be unique to each company. The changes would extend to both permanent and temporary insurance identification cards.

To meet the coming demand, Pearl River, N.Y.?based ACORD said it has developed a new temporary ID card, ACORD 50NJ. An existing card, ACORD 50WM, is currently accepted by the state as a permanent card and would remain acceptable under the proposed regulations, ACORD said.

Both cards have a watermark that disappears when copied, meeting the anti-fraud requirement, ACORD noted.

William Heine, a spokesman for the insurance department, said no regulations have been approved, but are expected to be in place before the end of the year.

Joel Volker, staff counsel for ACORD, said in response to questions by e-mail that the new card meets the requirements of the regulation, and similar cards are used in other states that require anti-counterfeiting measures.

"Over 315 U.S. companies use and accept ACORD ID cards, many of whom do business in New Jersey," he said.

Under the proposed regulations, card designs have to be submitted to the state insurance department for approval before use. ACORD said that the advantage for companies using its cards would be that they would not have to seek approval from the state to use the cards because the cards would already have the state's approval.