UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                  SCHEDULE 14A
                                 (Rule 14a-101)
                     INFORMATION REQUIRED IN PROXY STATEMENT
                            SCHEDULE 14A INFORMATION

                Proxy Statement Pursuant to Section 14(a) of the
                         Securities Exchange Act of 1934

Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ]  Preliminary Proxy Statement
[ ]  Confidential,  For Use of the  Commission  Only (as permitted by Rule 14a-6
     (e)(2))
[X]  Definitive Proxy Statement
[ ]  Definitive Additional Materials
[ ]  Soliciting Material Pursuant to Section 240.14a-12

                                DCAP GROUP, INC.
- --------------------------------------------------------------------------------
                (Name of Registrant as Specified in its Charter)

- --------------------------------------------------------------------------------
    (Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X]  No fee required.
[ ]  Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

     1)   Title of each class of securities to which transaction applies:

          not applicable
          -----------------------------------------------

     2)   Aggregate number of securities to which transaction applies:

          not applicable
          -----------------------------------------------
     3)   Per unit  price  or other  underlying  value of  transaction  computed
          pursuant to Exchange  Act Rule 0-11 (Set forth the amount on which the
          filing fee is calculated and state how it was determined):

          not applicable
          -----------------------------------------------

     4)   Proposed maximum aggregate value of transaction:

          not applicable
          -----------------------------------------------

     5)   Total fee paid:

          not applicable
          ----------------------------------------------

     [ ]  Fee paid previously with preliminary materials:

          ----------------------------------------------

[ ]  Check box if any part of the fee is offset as provided by Exchange Act Rule
     0-11(a)(2)  and identify the filing for which the  offsetting  fee was paid
     previously.  Identify the previous filing by registration statement number,
     or the Form or Schedule and the date of its filing.

    1)    Amount previously paid:

          ---------------------------------------------

     2)   Form, Schedule or Registration Statement No.:

          ---------------------------------------------

     3)   Filing Party:

          ---------------------------------------------

     4)   Date Filed:

          ---------------------------------------------

                                DCAP GROUP, INC.
                                  1158 Broadway
                             Hewlett, New York 11557

                    NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
                         TO BE HELD ON NOVEMBER 24, 2004
                         -------------------------------

To the Stockholders of DCAP Group, Inc.:

     NOTICE IS HEREBY  GIVEN that the Annual  Meeting  of  Stockholders  of DCAP
Group,  Inc.,  a Delaware  corporation,  will be held on November 24, 2004 at 90
Merrick  Avenue,  9th Floor,  East  Meadow,  New York,  at 10:00  a.m.,  for the
following purposes:

     1.   To elect five directors for the coming year.

     2.   To  transact  such other  business  as may  properly  come  before the
          meeting.

     Only  stockholders of record at the close of business on September 27, 2004
are  entitled  to notice  of and to vote at the  meeting  or at any  adjournment
thereof.

                                                    Morton L. Certilman
                                                    Secretary

Hewlett, New York
October 26, 2004

================================================================================

WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING,  PLEASE  VOTE,  DATE AND SIGN THE
ENCLOSED PROXY,  WHICH IS SOLICITED BY OUR BOARD OF DIRECTORS,  AND RETURN IT IN
THE PRE-ADDRESSED ENVELOPE PROVIDED FOR THAT PURPOSE. ANY STOCKHOLDER MAY REVOKE
HIS PROXY AT ANY TIME BEFORE THE MEETING BY WRITTEN  NOTICE TO SUCH  EFFECT,  BY
SUBMITTING A SUBSEQUENTLY  DATED PROXY OR BY ATTENDING THE MEETING AND VOTING IN
PERSON.
================================================================================

                                DCAP GROUP, INC.
                                  1158 Broadway
                             Hewlett, New York 11557
                          ____________________________

                                 PROXY STATEMENT
                          _____________________________

                                EXPLANATORY NOTE

     All references in this proxy  statement to numbers of common shares and per
share information give retroactive  effect to the one-for-five  reverse split of
our common shares effected as of August 26, 2004.

                  SOLICITING, VOTING AND REVOCABILITY OF PROXY

     This proxy  statement is being mailed to all  stockholders of record at the
close of business on September 27, 2004 in connection  with the  solicitation by
the  Board  of  Directors  of  proxies  to be  voted at the  Annual  Meeting  of
Stockholders  to be held on November 24, 2004 at 10:00 a.m.,  local time, or any
adjournment  thereof.  The  proxy  and  this  proxy  statement  were  mailed  to
stockholders on or about October 26, 2004.

     All shares  represented by proxies duly executed and received will be voted
on the matters  presented  at the meeting in  accordance  with the  instructions
specified in such proxies.  Proxies so received without  specified  instructions
will be voted FOR the nominees named in the proxy to our Board of Directors.

     Our Board does not know of any other matters that may be brought before the
meeting nor does it foresee or have reason to believe  that proxy  holders  will
have to vote for  substitute  or alternate  nominees to the Board.  In the event
that any other  matter  should  come  before the  meeting or any  nominee is not
available  for  election,  the  person  named in the  enclosed  proxy  will have
discretionary  authority  to vote all  proxies not marked to the  contrary  with
respect to such matters in accordance with his best judgment.

     The total number of common  shares  outstanding  and entitled to vote as of
September  27,  2004 was  2,512,424.  The  common  shares  are the only class of
securities entitled to vote on matters presented to our stockholders, each share
being entitled to one vote.

     Our Restated Certificate of Incorporation provides for cumulative voting of
shares for the election of directors.  This means that each  stockholder has the
right to  cumulate  his votes and give to one or more  nominees as many votes as
equals the number of directors to be elected (five)  multiplied by the number of
shares he is entitled to vote. A stockholder  may  therefore  cast his votes for
one nominee or distribute them among two or more of the nominees.  A majority of
the common shares  outstanding and entitled to vote as of September 27, 2004, or
1,256,213 common shares, must be present at the meeting in person or by proxy in
order to constitute a quorum for the transaction of

business.  Only  stockholders of record as of the close of business on September
27,  2004 will be entitled to vote.  With regard to the  election of  directors,
votes may be cast in favor or  withheld.  The  directors  shall be  elected by a
plurality of the votes cast in favor.  Accordingly,  based upon there being five
nominees,  each  person  who  receives  one or more  votes  will be elected as a
director.  Votes withheld in connection  with the election of one or more of the
nominees for director will not be counted as votes cast for such individuals and
may be voted  for the other  nominees.  Broker  non-votes  will be  counted  for
purposes of determining  the presence or absence of a quorum for the transaction
of business.

     Any person giving a proxy in the form accompanying this proxy statement has
the power to revoke it at any time before its exercise. The proxy may be revoked
by filing with us written notice of revocation or a fully executed proxy bearing
a later date. The proxy may also be revoked by affirmatively electing to vote in
person while in attendance at the meeting.  However,  a stockholder  who attends
the  meeting  need  not  revoke a proxy  given  and vote in  person  unless  the
stockholder  wishes to do so. Written  revocations or amended  proxies should be
sent to us at 1158  Broadway,  Hewlett,  New York  11557,  Attention:  Corporate
Secretary.

     The proxy is being  solicited by our Board of  Directors.  We will bear the
cost of the  solicitation  of proxies,  including  the  charges and  expenses of
brokerage  firms and other  custodians,  nominees and fiduciaries for forwarding
proxy materials to beneficial owners of our shares.  Solicitations  will be made
primarily  by mail,  but certain of our  directors,  officers or  employees  may
solicit  proxies in person or by telephone,  telecopier or email without special
compensation.

     A list of  stockholders  entitled to vote at the meeting  will be available
for  examination  by any  stockholder  for any purpose  germane to the  meeting,
during  ordinary  business  hours,  for ten days  prior to the  meeting,  at our
offices, 1158 Broadway,  Hewlett, New York 11557, and also during the whole time
of the meeting for inspection by any stockholder who is present.  To contact us,
stockholders should call (516) 374-7600.

                                       2

                             EXECUTIVE COMPENSATION

     Summary Compensation Table

     The  following  table  sets  forth  certain   information   concerning  the
compensation  for the fiscal years ended  December  31, 2003,  2002 and 2001 for
Barry B. Goldstein, our Chief Executive Officer:

                                                            Long-Term Compensation
Name and                         Annual Compensation                Awards            All Other
Principal Position       Year     Salary     Bonus        Shares Underlying Options  Compensation
- ------------------       ----     ------     -----        -------------------------  ------------

Barry B. Goldstein       2003    $300,000    $50,000(1)                  -               -
Chief Executive Officer  2002     200,000     70,000                 200,000             -
                         2001     200,000(2)    -                    200,000             -
- -----------------------------
(1)  Paid in March 2003 for services  rendered  during 2002.  Exclusive of bonus
     paid in 2004 for services rendered during 2003.
(2)  Includes amounts earned as a consultant prior to his employment.

     Option Tables

              Option Grants in Fiscal Year Ended December 31, 2003
              ----------------------------------------------------

                        Number of Common     Percentage of Total
                       Shares Underlying     Options Granted to
       Name             Options Granted     Employees in Fiscal Year  Exercise Price  Expiration Date
       ----            -----------------    ------------------------  --------------  ---------------

Barry B. Goldstein             -                      -                     -               -

                   Aggregated Option Exercises in Fiscal Year
            Ended December 31, 2003 and Fiscal Year-End Option Values
         --------------------------------------------------------------

                                                             Number of Shares
                           Number of                      Underlying Unexercised           Value of Unexercised
                             Shares                             Options at                 In-the-Money Options
                            Acquired        Value           December 31, 2003              at December 31, 2003
         Name             on Exercise     Realized      Exercisable/Unexercisable        Exercisable/Unexercisable
         ----             -----------     --------      -------------------------        -------------------------
Barry B. Goldstein             -             N/A             320,000 / 80,000              $1,070,000 / $280,000

     Long-Term Incentive Plan Awards

     No awards were made to Mr.  Goldstein during the fiscal year ended December
31, 2003 under any long-term incentive plan.

                                       3

     Compensation of Directors

     Effective  January 1, 2004,  our  non-employee  directors  are  entitled to
receive compensation for their services as directors as follows:

     o    $15,000 per annum
     o    additional $5,000 per annum for committee chair
     o    $500 per Board meeting attended ($250 if telephonic)
     o    $250 per committee meeting attended ($125 if telephonic)

     In addition, in 2003, we paid Mr. Certilman $50,000 in consideration of his
services in obtaining the $500,000  settlement  amount for our Puerto Rico hotel
lease during  fiscal 2002.  During 2003,  Mr.  Certilman  also was paid a fee of
$50,000 from us for consulting services.

     Employment  Contracts,  Termination  of  Employment  and  Change-in-Control
Arrangements

     Mr. Goldstein is employed as our President, Chairman of the Board and Chief
Executive  Officer pursuant to an Employment  Agreement that expires on April 1,
2005.  He is  currently  entitled to receive a salary of $350,000 per annum plus
such additional compensation as may be determined by the Board of Directors.

                    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
                              OWNERS AND MANAGEMENT

     Security Ownership

     The following table sets forth certain information as of September 27, 2004
regarding the  beneficial  ownership of our common shares by (i) each person who
we believe to be the beneficial owner of more than 5% of our outstanding  common
shares,  (ii) each  present  director,  (iii) each person  listed in the Summary
Compensation  Table under "Executive  Compensation," and (iv) all of our present
executive officers and directors as a group.

  Name and Address                   Number of Shares             Approximate
 of Beneficial Owner                Beneficially Owned          Percent of Class
 -------------------                ------------------          ----------------
Barry B. Goldstein                       380,400(1)(2)               13.2%
1158 Broadway
Hewlett, New York

AIA Acquisition Corp.                    361,600(3)                  12.6%
6787 Market Street
Upper Darby, Pennsylvania

                                       4

Eagle Insurance Company                  297,378(4)                  11.8%
c/o The Robert Plan
  Corporation
999 Stewart Avenue
Bethpage, New York

Robert M. Wallach                        297,378(5)                  11.8%
c/o The Robert Plan Corporation
999 Stewart Avenue
Bethpage, New York

Jack D. Seibald                          247,750(6)                   9.8%
1336 Boxwood Drive West
Hewlett Harbor, New York

Morton L. Certilman                      211,701(1)(7)                8.3%
90 Merrick Avenue
East Meadow, New York

Jay M. Haft                              182,278(1)(8)                7.2%
69 Beaver Dam Road
Salisbury, Connecticut

Abraham Weinzimer                        156,784(1)                   6.2%
418 South Broadway
Hicksville, New York

Kevin Lang                               130,292(1)                   5.2%
3789 Merrick Road
Seaford, New York

All executive officers
and directors as a group                 1,319,507(1)(2)(6)          44.9%
(5 persons)                                       (7)(8)(9)

- -----------------------

(1)  Based upon Schedule 13D filed under the Securities Exchange Act of 1934, as
amended.

(2)  Represents  (i) 360,000  shares  issuable upon the exercise of options that
are currently  exercisable,  (ii) 8,500 shares held by Mr. Goldstein's children,
and (iii)  11,900  shares  held in a  retirement  trust for the  benefit  of Mr.
Goldstein.  Mr. Goldstein disclaims  beneficial  ownership of the shares held by
his children and retirement trust. Excludes shares owned by AIA Acquisition

                                       5

Corp.  of which Mr.  Goldstein  is  President  and  members  of his  family  are
principal stockholders.

(3)  Based upon Schedule 13G filed under the Securities Exchange Act of 1934, as
amended. Represents shares issuable upon the conversion of preferred shares that
are currently convertible.

(4)  Eagle is a wholly-owned subsidiary of The Robert Plan Corporation.

(5)  Represents  shares  owned  by  Eagle,  of  which  Mr.  Wallach,  one of our
directors, is a Vice President. Eagle is a wholly-owned subsidiary of The Robert
Plan  Corporation,  of which  Mr.  Wallach  is  President,  Chairman  and  Chief
Executive Officer.

(6)  Based upon Schedule 13G filed under the Securities Exchange Act of 1934, as
amended.  Represents  (i) 113,000  shares owned  jointly by Mr.  Seibald and his
wife,  Stephanie  Seibald;  (ii) 100,000 shares owned by SDS Partners I, Ltd., a
limited partnership ("SDS");  (iii) 3,000 shares owned by Boxwood FLTD Partners,
a limited  partnership  ("Boxwood");  (iv) 6,000 shares owned by Stewart Spector
IRA ("S. Spector");  (v) 3,000 shares owned by Barbara Spector IRA Rollover ("B.
Spector");  (vi) 4,000 shares owned by Karen  Dubrowsky IRA  ("Dubrowsky");  and
(vii)  18,750  shares  issuable  upon  the  exercise  of  currently  exercisable
warrants.  Mr. Seibald has voting and dispositive power over the shares owned by
SDS,  Boxwood,  S. Spector,  B. Spector and Dubrowsky.  The amount  reflected as
owned  by S.  Spector  includes  3,000  shares  issuable  upon the  exercise  of
currently  exercisable  warrants and excludes  27,000  shares  issuable upon the
exercise  of  warrants  that  are  not  exercisable  due to a  restriction  that
precludes the beneficial ownership of more than 9.999% of the outstanding common
shares.

(7)  Includes 25,000 shares issuable upon the exercise of currently  exercisable
options.

(8)  Includes  (i)  25,000  shares  issuable  upon  the  exercise  of  currently
exercisable  options and (ii) 3,076  shares held in a  retirement  trust for the
benefit of Mr. Haft.

(9)  Includes  shares owned by Eagle,  of which Mr. Wallach is a Vice President.
Mr.  Wallach is also  President,  Chairman  and Chief  Executive  Officer of The
Robert Plan, Eagle's parent.

       Securities Authorized for Issuance Under Equity Compensation Plans

     The  following  table sets forth  information  as of December 31, 2003 with
respect to compensation plans (including individual  compensation  arrangements)
under  which our common  shares  are  authorized  for  issuance,  aggregated  as
follows:

     o    All compensation plans previously approved by security holders; and
     o    All compensation plans not previously approved by security holders.

                                       6

                      Equity Compensation Plan Information
                      ------------------------------------

                                                                  Weighted average          Number of securities remaining
                               Number of securities to be         exercise price of          available for future issuance
                                 issued upon exercise of        outstanding options,        under equity compensation plans
                                  outstanding options,           warrants and rights        (excluding securities reflected
                                   warrants and rights                   (b)                        in column (a))
                                           (a)                                                            (c)
                               ----------------------------    ------------------------    ----------------------------------

Equity compensation plans                630,500                        $3.30                           119,500
approved by security holders

Equity compensation plans                  -0-                           -0-                              -0-
not approved by security
holders                                  _______                                                         _____

Total                                    630,500                        $3.30                           119,500
                                         =======                         ====                           =======

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Sale of Brentwood Store

     Effective  February  27,  2003,  we sold our  Brentwood,  New York store to
Abraham  Weinzimer,  one of our principal  stockholders,  at a purchase price of
$115,437 (equal to  approximately  70% of the store's  commission  income during
2002).  Concurrently  with the purchase,  the entity  acquired by Mr.  Weinzimer
entered into a franchise  agreement with DCAP  Management  Corp.,  our franchise
subsidiary,  on terms  substantially  similar in most  respects to our  standard
conversion franchise agreements.  The terms of the above sale were the result of
arm's length negotiations  between us and Mr. Weinzimer that were based upon the
terms of other recent sales of our stores to persons who are not affiliated with
us and then current market conditions. No independent appraisal or valuation was
received in connection with the agreement.

     Purchase of Pennsylvania Stores

     Effective May 1, 2003, we acquired  substantially  all of the assets of AIA
Acquisition  Corp., an insurance  brokerage firm with offices located in eastern
Pennsylvania. The salient terms of the acquisition are as follows:

     o    A base purchase price of $904,000  (which  represents (i) 69% of AIA's
          includable commission income for the 12 months ended March 31, 2002 or
          the year ended  December 31, 2002,  whichever  was less,  plus (ii) an
          amount  equal to  AIA's  collected

                                       7

          accounts receivable and prepaid expenses). The base purchase price was
          payable in Series A preferred  shares.  The Series A preferred  shares
          carry  a  5%  dividend,  are  convertible  into  common  shares  at  a
          conversion  price of $2.50 per share and are  redeemable  on April 30,
          2007 (or sooner under certain circumstances).

     o    Additional  cash  consideration  based upon the EBITDA of the combined
          operations  of  AIA  and  our  wholly-owned  subsidiary,  Barry  Scott
          Companies Inc., during the five year period ending April 30, 2008. The
          additional consideration cannot exceed an aggregate of $335,000.

     Barry B. Goldstein,  our Chief Executive  Officer,  is President of AIA and
members  of his  family  are  principal  stockholders  of AIA.  The terms of the
acquisition were the result of arm's length negotiations  between AIA and us and
were based upon the sales price of stores to persons who are not affiliated with
us and current market conditions.

     Guaranty

     Mr.  Goldstein has guaranteed the repayment of $2,500,000 of an $18,000,000
line of  credit  from  Manufacturers  and  Traders  Trust  Co.  utilized  by our
subsidiary,   Payments  Inc,  to  finance  its  premium  finance  business.   In
consideration of the guaranty,  we have agreed that, for so long as the guaranty
remains in effect,  we will pay him $50,000 per annum and  reimburse him for all
premiums paid by him on a $2,500,000 insurance policy on his life. In the event,
at the time of his death,  the guaranty is still in effect,  the proceeds of the
life insurance  policy will be used to satisfy the guaranty.  In such event, Mr.
Goldstein's  estate  would not be entitled to be  indemnified  for the amount so
paid as a guarantor.

     2003 Subordinated Debt Financing

     Effective July 10, 2003, in order to fund our premium  finance  operations,
we obtained  $3,500,000  from a private  placement  of  subordinated  debt.  The
subordinated  debt is repayable on January 10, 2006 and provides for interest at
the rate of  12.625%  per  annum,  payable  semi-annually.  We have the right to
prepay the  subordinated  debt commencing on July 10, 2004. In  consideration of
the debt  financing,  we issued to the lenders  warrants  for the purchase of an
aggregate  of  105,000 of our common  shares at an  exercise  price of $6.25 per
share.  The warrants  expire on January 10, 2006.  One of the private  placement
lenders was a retirement trust established for the benefit of Jack Seibald which
loaned us $625,000  and was issued a warrant  for the  purchase of 18,750 of our
common shares.  Mr. Seibald is one of our principal  stockholders and, effective
September 2004, became one of our directors.

     Relationship

     Certilman Balin Adler & Hyman,  LLP, a law firm with which Mr. Certilman is
affiliated,  serves as our counsel.  It is presently  anticipated that such firm
will  continue to  represent  us and will receive fees for its services at rates
and in amounts not greater than would be paid to unrelated law firms  performing
similar services.

                                       8

                        PROPOSAL 1: ELECTION OF DIRECTORS

     Five  directors  are to be elected at the  meeting to serve  until the next
annual meeting of stockholders and until their respective  successors shall have
been elected and have qualified.

     Our Restated Certificate of Incorporation provides for cumulative voting of
shares for the election of directors.  This means that each  stockholder has the
right to  cumulate  his votes and give to one or more  nominees as many votes as
equals the number of directors to be elected (five)  multiplied by the number of
shares he is entitled to vote. A stockholder  may  therefore  cast his votes for
one nominee or distribute them among two or more of the nominees.

     Nominees for Directors

     All five of the nominees are currently  members of our Board. The following
table sets forth each  nominee's age as of September 27, 2004, the positions and
offices  presently  held by him  with us,  and the  year in  which  he  became a
director.  The Board  recommends  a vote FOR all  nominees.  The person named as
proxy intends to vote  cumulatively  all shares  represented by proxies  equally
among all nominees for election as directors,  unless  proxies are marked to the
contrary.

                                                                      Director
       Name         Age   Positions and Offices Held                    Since
       ----         ---   --------------------------                    -----

Barry B. Goldstein   51   President, Chairman of the Board, Chief       2001
                          Executive Officer, Chief Financial Officer,
                          Treasurer and Director
Morton L. Certilman  72   Secretary and Director                        1989
Jay M. Haft          68   Director                                      1989
Jack D. Seibald      43   Director                                      2004
Robert M. Wallach    51   Director                                      1999

     Barry B. Goldstein

     Mr.  Goldstein was elected our President,  Chief Executive  Officer,  Chief
Financial  Officer,  Chairman of the Board, and a director in March 2001 and our
Treasurer  in May 2001.  Since April  1997,  he has served as  President  of AIA
Acquisition  Corp.,  which operated insurance agencies in Pennsylvania and which
sold  substantially  all of its  assets to us in May 2003.  Since  1982,  he has
served as President of Stone Equities, a consulting firm. Mr. Goldstein received
his B.A. and M.B.A. from State University of New York at Buffalo, and has been a
certified public accountant since 1979.

                                       9

     Morton L. Certilman

     Mr.  Certilman served as our Chairman of the Board from February 1999 until
March 2001.  From October 1989 to February 1999, he served as our President.  He
was elected  our  Secretary  in May 2001 and has served as one of our  directors
since 1989. Mr. Certilman has been engaged in the practice of law since 1956 and
is  affiliated  with the law firm of  Certilman  Balin Adler & Hyman,  LLP.  Mr.
Certilman is Chairman of the Long Island Museum of Science and  Technology,  and
was formerly  Chairman of the Long Island Regional  Planning  Board,  the Nassau
County  Coliseum  Privatization  Commission,  and  the  Northrop/Grumman  Master
Planning Council. He served as a director of the Long Island Association and the
New Long Island  Partnership for a period of ten years and currently serves as a
director  of the Long Island  Sports  Commission.  Mr.  Certilman  has  lectured
extensively before bar associations, builders' institutes, title companies, real
estate  institutes,   banking  and  law  school  seminars,  The  Practicing  Law
Institute,  The Institute of Real Estate Management and at annual conventions of
such organizations as the National  Association of Home Builders,  the Community
Associations  Institute and the National  Association  of Corporate  Real Estate
Executives.   He  was  a   member   of  the   faculty   of  the   American   Law
Institute/American Bar Association,  as well as the Institute on Condominium and
Cluster  Developments of the University of Miami Law Center.  Mr.  Certilman has
written various articles in the condominium  field, and is the author of the New
York State Bar Association  Condominium  Cassette and the Condominium portion of
the State Bar Association book on "Real Property Titles." Mr. Certilman received
an LL.B. degree, cum laude, from Brooklyn Law School.

     Jay M. Haft

     Mr. Haft served as our Vice  Chairman of the Board from February 1999 until
March 2001. From October 1989 to February 1999, he served as our Chairman of the
Board.  He has served as one of our  directors  since  1989.  Mr.  Haft has been
engaged in the  practice  of law since 1959 and since 1994 has served as counsel
to Parker Duryee Rosoff & Haft (and since December  2001,  its  successor,  Reed
Smith).  From 1989 to 1994, he was a senior corporate  partner of that firm. Mr.
Haft is a strategic and financial  consultant for growth stage companies.  He is
active in international corporate finance and mergers and acquisitions. Mr. Haft
also  represents  emerging  growth  companies.  He has actively  participated in
strategic planning and fund raising for many high-tech  companies,  leading edge
medical technology companies and marketing  companies.  He is a director of many
public and private corporations,  including DUSA Pharmaceuticals,  Inc. and Oryx
Technology  Corp.,  and also  serves on the Board of the  United  States-Russian
Business  Counsel.  Mr.  Haft is a past  member of the  Florida  Commission  for
Government  Accountability  to the People, a past national trustee and Treasurer
of the Miami City Ballet, and a past Board member of the Concert  Association of
Florida. He is also a trustee of Florida International University Foundation and
serves on the advisory board of the Wolfsonian Museum and Florida  International
University  Law School.  Mr. Haft  received  B.A.  and LL.B.  degrees  from Yale
University.

     Jack D. Seibald

     Mr.  Seibald  has been a Managing  Member of  Whiteford  Advisors  LLC,  an
investment  management  firm,  since its founding in 1997.  With a background in
equity research and investment

                                       10

management,  Mr. Seibald's  experience in the investment business dates to 1983.
He began his  career at  Oppenheimer  & Co.  and has also been  affiliated  with
Salomon  Brothers,  Morgan Stanley & Co. and Blackford  Securities.  Mr. Seibald
also operated The Seibald  Report,  Inc.,  an  independent  investment  research
company.  Mr.  Seibald is  currently a  registered  representative  with Sanders
Morris Harris, a broker-dealer. He holds an M.B.A. from Hofstra University and a
B.A. from George Washington University.

     Robert M. Wallach

     Mr.  Wallach  has  served  since  1993 as  President,  Chairman  and  Chief
Executive Officer of The Robert Plan Corporation,  a servicer and underwriter of
private passenger and commercial automobile  insurance.  He has served as one of
our directors since 1999.

     Executive Officers

     Jack  Willis,  age 39,  was  elected  Executive  Vice  President  and Chief
Operating Officer effective October 18, 2004. From January 2003 to October 2004,
Mr. Willis served The Hartford  Insurance  Company in various  management roles,
last  serving as Vice  President-  Personal  Lines  Product  Management  for the
Northeast  Region.  In this  capacity,  he was  responsible  for the  growth and
profitability of the auto,  homeowners and umbrella products sold through agency
and direct distribution  channels in ten states.  Prior to joining The Hartford,
Mr. Willis served in various  management  capacities for  Progressive  Insurance
Company,  the third largest auto  insurance  company in the United  States.  His
roles at Progressive  included agency auto product manager,  agency distribution
manager and claims manager.  Mr. Willis  graduated summa cum laude from Syracuse
University  with a  bachelor's  degree in Finance  and  earned  his M.B.A.  from
Harvard University's Graduate School of Business Administration.

     Family Relationships

     There are no family  relationships  among any of our executive officers and
directors.

     Term of Office

     Each  director   will  hold  office  until  the  next  annual   meeting  of
stockholders  and until his  successor  is elected  and  qualified  or until his
earlier  resignation or removal.  Each executive  officer will hold office until
the initial meeting of the Board of Directors  following the next annual meeting
of  stockholders  and until his  successor is elected and qualified or until his
earlier resignation or removal.

     Committees

     Audit Committee

     The Audit Committee of the Board of Directors is responsible for overseeing
our accounting and financial reporting processes and the audits of our financial
statements.  The  responsibilities and

                                       11

duties of the Audit Committee include the following:

     o    assist the Board of Directors in fulfilling  its  responsibilities  by
          reviewing
          o    the  financial  reports  provided  by us to  the  Securities  and
               Exchange  Commission,  our stockholders or to the general public,
               and
          o    our internal financial and accounting controls,

     o    oversee the appointment,  compensation, retention and oversight of the
          work performed by any independent public accountants engaged by us,

     o    recommend,  establish and monitor  procedures  designed to improve the
          quality and  reliability of the disclosure of our financial  condition
          and results of operations,

     o    recommend, establish and monitor procedures designed to facilitate
          o    the receipt,  retention and  treatment of complaints  relating to
               accounting, internal accounting controls or auditing matters and
          o    the receipt of confidential,  anonymous  submissions by employees
               of  concerns  regarding   questionable   accounting  or  auditing
               matters.

     The members of the Audit Committee  currently are Messrs.  Haft,  Certilman
and Seibald.  Messrs. Haft and Seibald are "independent  directors" based on the
definition of independence in Rule  4200A(a)(14) of the listing standards of the
National  Association  of  Securities  Dealers  currently  applicable  to  small
business issuers. Mr. Certilman is not an "independent  director." The Board has
adopted a written charter for the Audit  Committee,  a copy of which is attached
to this proxy statement as Appendix A.

     Nominating Committee

     The  Nominating  Committee  of the Board of Directors  is  responsible  for
assisting the Board in  identifying  and  recruiting  qualified  individuals  to
become Board  members and select  director  nominees to be  presented  for Board
and/or stockholder  approval.  The members of the Nominating Committee currently
are  Messrs.   Certilman,  Haft  and  Seibald.  Messrs.  Haft  and  Seibald  are
"independent  directors"  based  on  the  definition  of  independence  in  Rule
4200A(a)(14) of the listing standards of the National  Association of Securities
Dealers currently  applicable to small business issuers. Mr. Certilman is not an
"independent  director."  To date,  our  Board of  Directors  has not  adopted a
written  charter for the Nominating  Committee.  The  Nominating  Committee will
consider  qualified  director  candidates  recommended by  stockholders  if such
recommendations  are provided in accordance with the procedures set forth in the
section entitled  "Stockholder  Proposals - Stockholder Nominees" below. At this
time,  the   Nominating   Committee  has  not  adopted   minimum   criteria  for
consideration of a proposed candidate for nomination.

     Compensation Committee

     The Compensation Committee of the Board of Directors is responsible for the
management of our business and affairs with respect to the  compensation  of our
employees, including the

                                       12

determination of the compensation for our Chief Executive  Officer and our other
executive  officers,  the  approval of one or more stock  option plans and other
compensation  plans covering our  employees,  and the grant of stock options and
other awards pursuant to stock option plans and other  compensation  plans.  The
members of the Compensation Committee currently are Messrs.  Certilman, Haft and
Seibald.

     Report of the Audit Committee

     In overseeing the preparation of DCAP's financial statements as of December
31, 2003 and for the years ended December 31, 2003 and 2002, the Audit Committee
met with  management  to review and discuss all  financial  statements  prior to
their issuance and to discuss significant accounting issues.  Management advised
the Committee  that all financial  statements  were prepared in accordance  with
generally  accepted  accounting  principles,  and the  Committee  discussed  the
statements with  management.  The Committee also discussed with Holtz Rubenstein
Reminick LLP, DCAP's outside  auditors,  the matters required to be discussed by
Statement on Auditing Standards No. 61 (Communication with Audit Committees).

     The  Committee  received  the  written  disclosures  and letter  from Holtz
Rubenstein Reminick LLP required by Independence  Standards Board Standard No. 1
(Independence Discussions with Audit Committees) and the Committee discussed the
independence of Holtz Rubenstein Reminick LLP with that firm.

     On the basis of these reviews and discussions, the Committee recommended to
the Board of  Directors  that the audited  financial  statements  be included in
DCAP's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2003,
for filing with the Securities and Exchange Commission.

                         Members of the Audit Committee

                               Morton L. Certilman
                               Jay M. Haft

     Meetings

     Our Board of  Directors  held ten  meetings  during the  fiscal  year ended
December 31, 2003. Mr. Wallach was the only director to attend fewer than 75% of
the Board meetings held during 2003, having attended six of the meetings.

     The Audit Committee of the Board of Directors held four meetings during the
fiscal year ended December 31, 2003.

     Neither the Nominating  Committee nor the  Compensation  Committee held any
meetings  during the fiscal year ended December 31, 2003 as each was established
by our Board in December 2003.

                                       13

     We do not have a formal policy regarding director  attendance at our annual
meeting of stockholders.  However, all directors are encouraged to attend. Three
of the four then Board members were in attendance at last year's annual  meeting
of stockholders.

     Communications with Board of Directors

     Any security  holder who wishes to communicate  with our Board of Directors
or a  particular  director  should  send  the  correspondence  to the  Board  of
Directors,  DCAP Group,  Inc.,  1158 Broadway,  Hewlett,  New York 11557,  Attn:
Corporate  Secretary.  Any such  communication so addressed will be forwarded by
the Corporate Secretary to the members or a particular member of the Board.

     Section 16(a) Beneficial Ownership Reporting Compliance

     Section  16 of  the  Exchange  Act  requires  that  reports  of  beneficial
ownership  of common  shares  and  changes in such  ownership  be filed with the
Securities and Exchange Commission by Section 16 "reporting  persons," including
directors,  certain officers, holders of more than 10% of the outstanding common
shares and  certain  trusts of which  reporting  persons  are  trustees.  We are
required to disclose in this proxy statement each reporting  person whom we know
to have failed to file any required  reports  under Section 16 on a timely basis
during the fiscal year ended December 31, 2003. To our  knowledge,  based solely
on a review of written representations that no reports were required, during the
fiscal  year  ended  December  31,  2003,   our  officers,   directors  and  10%
stockholders  complied with all Section 16(a) filing requirements  applicable to
them,  except that, on two occasions,  Mr. Goldstein filed a Form 4 one day late
(which forms reported one late transaction each).

                         INDEPENDENT PUBLIC ACCOUNTANTS

     Holtz  Rubenstein  Reminick,  LLP has served as our auditors since 1990 and
was selected as our independent  public  accountants  with respect to the fiscal
year ended  December  31,  2003.  We have not yet  selected our auditors for the
current fiscal year. Our Audit Committee will review Holtz Rubenstein Reminick's
proposal with respect to the audit prior to making a determination regarding the
engagement.

     It is not expected that a representative of Holtz Rubenstein  Reminick will
attend the meeting.

     The  following  is a summary of the fees  billed to us by Holtz  Rubenstein
Reminick for professional  services rendered for the fiscal years ended December
31, 2003 and December 31, 2002:

                                       14

            Fee Category                 Fiscal 2003 Fees       Fiscal 2002 Fees
            ------------                 ----------------       ----------------

            Audit Fees(1)                  $44,400                 $58,305
            Audit-Related Fees(2)            1,675                  10,750
            Tax Fees                          -                       -
            All Other Fees(3)                9,630                  13,000
                                           -------                  ------
            Total Fees                     $55,705                 $82,055
                                           =======                 =======
________________

(1) "Audit Fees"  consist of  aggregate  fees billed for  professional  services
rendered  for the audit of our  annual  financial  statements  and review of the
interim financial  statements included in quarterly reports or services that are
normally  provided by the independent  auditors in connection with statutory and
regulatory  filings or engagements  for the fiscal years ended December 31, 2003
and December 31, 2002, respectively.

(2)  "Audit-Related  Fees"  consist of aggregate  fees billed for  assurance and
related services that are reasonably  related to the performance of the audit or
review of our  financial  statements  and are not reported  under "Audit  Fees."
These fees  related to a review of our  Current  Reports on Form 8-K and matters
related to our acquisition of Barry Scott Companies, Inc.

(3) "All Other Fees" consist of aggregate  fees billed for products and services
provided by Holtz Rubenstein  Reminick,  other than those disclosed above. These
fees  related  to the audits of our  wholly-owned  subsidiary,  DCAP  Management
Corp., and general accounting consulting services.

     The Audit Committee is responsible for the  appointment,  compensation  and
oversight  of the work of the  independent  auditors and approves in advance any
services to be performed by the independent  auditors,  whether audit-related or
not. The Audit Committee  reviews each proposed  engagement to determine whether
the provision of services is compatible with maintaining the independence of the
independent auditors. All of the fees shown above were pre-approved by the Audit
Committee.

                              STOCKHOLDER PROPOSALS

     Stockholder  proposals  intended to be presented at our next annual meeting
of  stockholders  pursuant to the provisions of Rule 14a-8 of the Securities and
Exchange Commission, promulgated under the Exchange Act, must be received at our
offices  in  Hewlett,  New York by June  28,  2005 for  inclusion  in our  proxy
statement and form of proxy  relating to such meeting.  We,  however,  intend to
hold our next  annual  meeting  earlier  in 2005 than in 2004.  Accordingly,  we
suggest that stockholder  proposals  intended to be presented at the next annual
meeting be submitted  well in advance of April 15, 2005,  the earliest date upon
which we  anticipate  the proxy  statement  and form of proxy  relating  to such
meeting will be released to stockholders.

     The  following  requirements  with  respect to  stockholder  proposals  and
stockholder nominees to our Board of Directors are included in our By-Laws.

                                       15

     Stockholder Proposals

     In order for a  stockholder  to make a  proposal  at an annual  meeting  of
stockholders, under our By-Laws, timely notice must be received by us in advance
of the meeting.  To be timely, the proposal must be received by our Secretary at
our principal  executive offices (as provided below) on a date which is not less
than 60 days nor more than 90 days  prior to the date which is one year from the
date of the mailing of the proxy  statement for the prior year's annual  meeting
of stockholders.  If during the prior year we did not hold an annual meeting, or
if the date of the meeting for which a stockholder  intends to submit a proposal
has  changed  more than 30 days from the date of the  meeting in the prior year,
then the notice  must be  received a  reasonable  time  before we mail the proxy
statement for the current year. A stockholder's notice must set forth as to each
matter the  stockholder  proposes  to bring  before the annual  meeting  certain
information regarding the proposal, including the following:

     o    a brief  description of the business  desired to be brought before the
          meeting and the reasons for conducting such business at such meeting;

     o    the name and address of the stockholder proposing such business;

     o    the class and number of our  shares  which are  beneficially  owned by
          such stockholder; and

     o    any material interest of such stockholder in such business.

     Stockholder Nominees

     In order for a stockholder to nominate a candidate for director,  under our
By-Laws,  timely notice of the  nomination  must be received by us in advance of
the  meeting.  To be  timely,  the  notice  must be  received  at our  principal
executive  offices  (as  provided  below) not less than 60 days nor more than 90
days prior to the meeting;  however, if less than 70 days' notice of the date of
the meeting is given to stockholders and public  disclosure of the meeting date,
pursuant to a press  release,  is either not made at all or is made less than 70
days prior to the meeting date,  notice by a stockholder  to be timely made must
be so received  no later than the close of  business on the tenth day  following
the earlier of the following:

     o    the day on which the notice of the date of the  meeting  was mailed to
          stockholders, or

     o    the day on which such public disclosure of the meeting date was made.

     The  stockholder  sending the notice of nomination  must  describe  various
matters, including such information as:

     o    the  name,  age,  business  and  residence  addresses,  occupation  or
          employment and

                                       16

          shares held by the nominee;

     o    any  other  information  relating  to  such  nominee  required  to  be
          disclosed in a proxy statement; and

     o    the name, address and number of shares held by the stockholder.

     These  requirements are separate from and in addition to the requirements a
stockholder must meet to have a proposal included in our proxy statement.

     Any notice given pursuant to the foregoing requirements must be sent to our
Corporate Secretary at 1158 Broadway,  Hewlett, New York 11557. The foregoing is
only a summary of the  provisions  of our  By-Laws  that  relate to  stockholder
proposals and stockholder  nominations for director.  Any stockholder desiring a
copy of our  By-Laws  will be  furnished  one without  charge upon  receipt of a
written request therefor.

                                 OTHER BUSINESS

     While the  accompanying  Notice of Annual Meeting of Stockholders  provides
for the  transaction  of such other  business  as may  properly  come before the
meeting,  we have no  knowledge  of any matters to be  presented  at the meeting
other than that listed as Proposal 1 in the notice.  However, the enclosed proxy
gives  discretionary  authority  in the event that any other  matters  should be
presented.

                                   FORM 10-KSB

     This proxy  statement is accompanied by a copy of our Annual Report on Form
10-KSB for the year ended December 31, 2003 (excluding exhibits).  We may charge
a fee equal to our reasonable expenses in furnishing the exhibits.

                                                   Barry B. Goldstein
                                                   Chief Executive Officer

Hewlett, New York
October 26, 2004

                                                           Appendix A
                                                           ----------

                                DCAP GROUP. INC.

                             AUDIT COMMITTEE CHARTER

A.   Purpose and Scope
     -----------------

     The primary function of the Audit Committee (the "Committee") is to oversee
the  accounting  and  financial  reporting  processes of DCAP Group,  Inc.  (the
"Corporation") and the audits of the financial statements of the Corporation and
to exercise the responsibilities and duties set forth below, including,  but not
limited to: (a) assist the Board of Directors in fulfilling its responsibilities
by  reviewing:  (i) the financial  reports  provided by the  Corporation  to the
Securities and Exchange Commission ("SEC"), the Corporation's stockholders or to
the general public, and (ii) the Corporation's internal financial and accounting
controls, (b) oversee the appointment,  compensation, retention and oversight of
the  work  performed  by  any  independent  public  accountants  engaged  by the
Corporation, (c) recommend, establish and monitor procedures designed to improve
the quality and  reliability  of the disclosure of the  Corporation's  financial
condition  and  results of  operations,  (d)  recommend,  establish  and monitor
procedures  designed to facilitate  (i) the receipt,  retention and treatment of
complaints  relating to  accounting,  internal  accounting  controls or auditing
matters and (ii) the receipt of confidential, anonymous submissions by employees
of concerns regarding  questionable  accounting or auditing matters,  (e) engage
advisors as necessary,  and (f) determine the funding from the Corporation  that
is necessary or appropriate to carry out the Committee's duties.

B.   Composition
     -----------

     The Committee  shall be comprised of such minimum number of directors as to
satisfy the audit committee composition requirements promulgated by the SEC, the
National  Association of Securities Dealers,  any exchange upon which securities
of the Company are traded,  or any  governmental  or regulatory  body exercising
authority  over the Company  (each a  "Regulatory  Body" and  collectively,  the
"Regulatory  Bodies"),  as in effect from time to time.  The  composition of the
Committee  shall  satisfy  the  independence   requirements  of  any  applicable
Regulatory  Body,  and each  member  of the  Committee  shall  be free  from any
relationship  that,  in the opinion of the Board of Directors,  would  interfere
with  the  exercise  of his or  her  independent  judgment  as a  member  of the
Committee.

     Each  member  of the  Committee  shall  be  able  to  read  and  understand
fundamental financial  statements,  including a balance sheet, income statement,
and cash flow  statement,  and not have  participated  in the preparation of the
financial  statements  of the  Corporation  or  any  current  subsidiary  of the
Corporation at any time during the past three years.  At least one member of the
Committee  shall have had past  employment  experience in finance or accounting,
requisite  professional   certification  in  accounting,   or  other  comparable
experience  or  background   which   results  in  the   individual's   financial
sophistication,  including being or having been a chief executive officer,

chief  financial  officer  or other  senior  officer  with  financial  oversight
responsibilities(1).

     The members of the Committee  shall be elected by the Board of Directors at
the  meeting  of the  Board  of  Directors  following  each  annual  meeting  of
stockholders  and shall serve until their  successors  shall be duly elected and
qualified  or until their  earlier  resignation  or  removal.  Unless a Chair is
elected  by the full  Board of  Directors,  the  members  of the  Committee  may
designate a Chair by majority vote of the full Committee membership.

     The Committee shall meet with management,  the internal  auditors,  if any,
and the independent  accounting firm in executive sessions at least quarterly to
discuss matters for which the Committee has responsibility.

C.   Responsibilities and Duties
     ---------------------------

     To fulfill its responsibilities and duties, the Committee shall:

Document Review
- ---------------

1.   Review and assess the adequacy of this Charter  periodically  as conditions
dictate,   but  at  least   annually  (and  update  this  Charter  if  and  when
appropriate).

2.   Review  with  representatives  of  management  and  representatives  of the
independent   accounting  firm  the   Corporation's   audited  annual  financial
statements  prior to their  filing as part of the Annual  Report on Form 10-K or
10-KSB.  After such review and discussion,  the Committee shall recommend to the
Board of Directors whether such audited financial statements should be published
in the Corporation's  Annual Report on Form 10-K or 10-KSB.  The Committee shall
also review the  Corporation's  quarterly  financial  statements  prior to their
inclusion in the Corporation's Quarterly Reports on Form 10-Q or 10-QSB.

3.   Instruct  the  independent  accounting  firm to  review  the  Corporation's
interim  financial  statements  prior to their  inclusion  in the  Corporation's
Quarterly Reports on Form 10-Q or 10-QSB.

Independent Accounting Firm
- ---------------------------

4.   The  Committee  shall  be  directly   responsible   for  the   appointment,
compensation,  retention and oversight of the work of any independent accounting
firm engaged by the Corporation for the purpose of preparing or issuing an audit
report or performing other audit, review or attest services or any other related
work. The authority of the Committee shall include ultimate authority to approve
all audit  engagement  fees and terms.  The  Committee  shall have the  ultimate
authority and

- ---------------------
(1) This paragraph  shall take effect at such time as any applicable  Regulatory
Body's rules and  regulations  shall  mandate that the members of the  Committee
satisfy the requirements set forth therein (such time being July 31, 2005 in the
event that the  Corporation's  securities are listed on The Nasdaq Stock Market,
Inc.  and the  Corporation  remains a "small  business  issuer" (as such term is
defined in the SEC's rules and regulations) until such time).

responsibility  to  appoint,   evaluate  and,  when  warranted,   replace,  such
independent  accounting  firm (or to recommend such  replacement for shareholder
approval in any proxy statement).

5.  Resolve any disagreements between management and the independent accounting
firm as to financial reporting matters.

6.  Instruct the independent  accounting firm that it should report directly to
the Committee on matters  pertaining to the work performed during its engagement
and on matters required by applicable Regulatory Body rules and regulations.

7.  On an annual basis,  receive from the independent  accounting firm a formal
written  statement   identifying  all  relationships   between  the  independent
accounting firm and the Corporation consistent with Independence Standards Board
Standard 1, as it may be modified or supplemented.  The Committee shall actively
engage in a dialogue with the  independent  accounting  firm as to any disclosed
relationships  or services  that may impact the  independent  accounting  firm's
objectivity and  independence.  The Committee shall take  appropriate  action to
oversee the independence of the independent accounting firm.

8.  On an  annual  basis,  discuss  with  representatives  of  the  independent
accounting  firm the matters  required to be  discussed by Statement on Auditing
Standards 61, as it may be modified or supplemented.

9.  Meet with the independent  accounting firm prior to the audit to review the
planning and  staffing of the audit and  consider  whether or not to approve the
auditing services proposed to be provided.

10. Evaluate the  performance of the  independent  accounting firm and consider
the discharge of the independent accounting firm when circumstances warrant. The
independent accounting firm shall be ultimately accountable to the Committee.

11. Oversee the rotation of the lead (or  coordinating)  audit  partner  having
primary  responsibility  for the  audit and the audit  partner  responsible  for
reviewing the audit at least once every five years,  and oversee the rotation of
other audit partners, in accordance with applicable rules and regulations.

12. Consider  in  advance  whether or not to  approve  any audit and  non-audit
services to be  performed  by the  independent  accounting  firm  required to be
approved  by  the  Committee  pursuant  to  the  rules  and  regulations  of any
applicable   Regulatory   Body  and  adopt  and  implement   policies  for  such
pre-approval.

13. The  Committee  shall have the  authority  to  oversee  and  determine  the
compensation of any  independent  accounting firm engaged by the Corporation and
shall notify the Corporation of anticipated funding needs of the Committee.

Internal Audit Function
- -----------------------

14. Review the responsibilities, budget and staffing of any internal auditors.

15. Review the  significant  reports to  management  prepared  by any  internal
auditors and management's responses.

Financial Reporting Processes
- -----------------------------

16. In consultation with the independent accounting firm and management, review
annually  the adequacy of the  Corporation's  internal  control  over  financial
reporting.

17. Review  disclosures  made  to  the  Committee  by the  Corporation's  chief
executive   officer  and  chief  financial  officer  in  connection  with  their
certifications  of the  Corporation's  Annual Reports on Form 10-K or 10-KSB and
Quarterly Reports on Form 10-Q or 10-QSB,  including disclosures  concerning (a)
evaluations of the design and operation of the  Corporation's  internal  control
over financial reporting,  (b) significant  deficiencies and material weaknesses
in the design and operation of the Corporation's internal control over financial
reporting  which are  reasonably  likely to adversely  affect the  Corporation's
ability to record, process, summarize, and report financial information, and (c)
any fraud, whether or not material,  that involves management or other employees
who  have  a  significant  role  in the  Corporation's  internal  controls.  The
Committee  shall direct the actions to be taken and/or make  recommendations  to
the Board of  Directors  of actions to be taken to the extent  such  disclosures
indicate the finding of any  significant  deficiencies  in internal  controls or
fraud.

18. Regularly review the Company's critical  accounting policies and accounting
estimates  resulting from the application of these policies and inquire at least
annually  of  both  the  Corporation's   internal  auditors,  if  any,  and  the
independent  accounting  firm as to whether either has any concerns  relative to
the quality or aggressiveness of management's accounting policies.

19. Request and review  periodic  reports from management of the Corporation as
to the  Corporation's  processes  for  reporting  on  internal  controls  of the
Corporation as required by Section 404 of the Sarbanes-Oxley Act of 2002.

Compliance
- ----------

20. To the extent deemed necessary by the Committee to carry out its duties, it
shall have the  authority  to engage  outside  counsel,  independent  accounting
consultants and/or other experts at the Corporation's expense.

21. Determine the funding  necessary for (i)  compensation  of any  independent
accounting  firm engaged for the purpose of preparing or issuing an audit report
or performing other audit,  review or attest services for the Corporation,  (ii)
ordinary  administrative  expenses  of  the  Committee  that  are  necessary  or
appropriate in carrying out the Committee's  duties,  and (iii)  compensation of
any outside  advisors to be engaged by the Committee and notify the  Corporation
of anticipated funding

needs of the Committee.

22. Establish written procedures for (a) the receipt,  retention, and treatment
of  complaints  received  by  the  Corporation  regarding  accounting,  internal
accounting controls,  or auditing matters;  and (b) the confidential,  anonymous
submission by employees of the  Corporation of concerns  regarding  questionable
accounting or auditing matters.

23. Investigate   any   allegations   that  any  officer  or  director  of  the
Corporation,  or any other person acting under the direction of any such person,
took any action to fraudulently influence,  coerce,  manipulate,  or mislead any
independent  public or certified  accountant  engaged in the  performance  of an
audit  of the  financial  statements  of the  Corporation  for  the  purpose  of
rendering  such  financial  statements   materially   misleading  and,  if  such
allegations  prove to be correct,  take or  recommend  to the Board of Directors
appropriate disciplinary action.

Reporting
- ---------

24. Prepare,  in  accordance  with  the  rules  of  the  SEC,  as  modified  or
supplemented from time to time, a written report of the Committee to be included
in  the  Corporation's  annual  proxy  statement  for  each  annual  meeting  of
stockholders.

25. To the extent required by any Regulatory Body,  instruct the  Corporation's
management to disclose in its annual proxy  statement for each annual meeting of
stockholders,  Annual Report on Form 10-K or 10-KSB and Quarterly Report on Form
10-Q  or  10-QSB,  the  approval  by the  Committee  of any  non-audit  services
performed by the  independent  accounting  firm, and review the substance of any
such disclosure and the  considerations  relating to the  compatibility  of such
services with maintaining the independence of the accounting firm.

     While the Audit Committee has the  responsibilities and powers set forth in
this  Charter,  it is not the duty of the  Audit  Committee  to plan or  conduct
audits or to determine that the Corporation's  financial statements are complete
and  accurate  and  are  in  accordance  with  generally   accepted   accounting
principles.

                                DCAP GROUP, INC.

           This Proxy is Solicited on Behalf of the Board of Directors

     The undersigned hereby appoints Barry B. Goldstein as proxy, with the power
to appoint his substitute,  and hereby  authorizes him to represent and vote, as
designated on the reverse side,  all the common shares of DCAP Group,  Inc. (the
"Company")  held of  record  by the  undersigned  at the  close of  business  on
September 27, 2004 at the Annual Meeting of  Stockholders to be held on November
24, 2004 or any adjournment thereof.

                (Continued and to be signed on the reverse side)

                        ANNUAL MEETING OF STOCKHOLDERS OF

                                DCAP GROUP, INC.

                                November 24, 2004

                           Please date, sign and mail
                             your proxy card in the
                            envelope provided as soon
                                  as possible.

     Please detach along perforated line and mail in the envelope provided.
- --------------------------------------------------------------------------------

PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR
VOTE IN BLUE OR BLACK INK AS SHOWN HERE X
                                       ---

1.   Election of Directors:

o FOR ALL NOMINEES

o WITHHOLD AUTHORITY FOR ALL NOMINEES

o FOR ALL EXCEPT
  (See instructions below)
        NOMINEES:

        o       Barry B. Goldstein    ________________
        o       Morton L. Certilman   ________________
        o       Jay M. Haft           ________________
        o       Jack D. Seibald       ________________
        o       Robert M. Wallach     ________________

     The Company's Restated Certificate of Incorporation provides for cumulative
voting  of  shares  for  the  election  of  directors,  which  means  that  each
stockholder has the right to cumulate his votes and give to one or more nominees
as many votes as equals the number of directors to be elected (five)  multiplied
by the number of shares he is entitled to vote. A stockholder may therefore cast
his votes for one nominee or distribute  them among two or more of the nominees.
A vote FOR includes discretionary authority to cumulate votes among nominees. To
cumulate specifically votes for any nominee, set forth the number of votes after
each  nominee.  Instruction:  To withhold  authority to vote for any  individual
nominee(s),  mark "FOR ALL EXCEPT"  and fill in the circle next to each  nominee
you wish to withhold, as shown here: o

2.   In his discretion, the proxy is authorized to vote upon such other business
as may properly come before the meeting.

This proxy, when properly executed,  will be voted in the manner directed by the
undersigned  stockholder.  If no direction is made, this proxy will be voted FOR
the election of the named nominees as directors.

To  change  the  address  on your  account,  please  check  the box at right and
indicate  your new address in the space  above.  Please note that changes to the
registered name(s) on the account may not be submitted via this method. o

Signature of Stockholder ________________________ Date:_________________

Signature of Stockholder ________________________ Date:_________________

Note:  Please sign exactly as name appears above.  When shares are held jointly,
each holder  should sign.  When signing as  attorney,  executor,  administrator,
trustee or guardian,  please give full title as such. If a  corporation,  please
sign in full corporate  name by duly  authorized  officer,  giving full title as
such. If a partnership or limited liability company,  please sign in partnership
or limited liability company name by authorized person.