What are "assigned risk" plans designed to do?

Assigned risk plans are specifically designed to provide insurance coverage to high-risk individuals who may have difficulty obtaining coverage through the standard market. These individuals often present higher risks to insurers due to factors such as previous insurance claims, driving records, or other risk indicators that make them ineligible for traditional insurance options.

The assigned risk mechanism ensures that these individuals are not left without insurance by distributing their risks among various insurers. This means that every insurance company in the state is required to accept a certain number of high-risk policyholders, which helps to stabilize the market and ensure broader access to insurance coverage.

Through this plan, high-risk individuals can still obtain necessary coverage and remain insured, which is essential for legal and financial protection. The key function of assigned risk plans is to provide an avenue for those who are unable to access coverage in the conventional insurance marketplace.