What is assigned risk auto insurance?

Assigned risk auto insurance is a type of coverage for extremely high-risk drivers who can’t obtain a traditional policy directly from a car insurance company. In each of the 42 states where assigned risk auto insurance plans are available, a specially designated office assigns these otherwise-uninsurable drivers to an auto insurance company that can provide them with the minimum level of coverage required by state law. This shared market is often referred to as the “assigned risk pool,” where auto insurers in any given state are required to accept a certain number of high-risk drivers proportional to their market share.

A variety of factors that determine a driver’s risk level, including how much experience they have, how many accidents they’ve been in and how many tickets they’ve received. Most high-risk drivers should still be able to find traditional auto insurance; it will just cost more than it would for a driver with a clean record. But some drivers, such as those with multiple DUI convictions, are so risky that no insurance company is willing to provide them with coverage, and they have to enter the assigned risk pool in order to comply with state law.

The specifics of assigned risk auto insurance vary by state, but you will usually qualify once you’ve been denied coverage three times. After the third denial, the insurance company will notify the state that you need to be in the assigned risk pool, and you might need to provide proof of your situation. Once you’ve obtained coverage, you should expect to be paying much higher premiums for what is essentially the minimum insurance required by the state.

After you’ve entered the assigned risk pool, you’ll likely stay there for at least three years. If you pay your premiums and keep your driving record clean during that period, you should be able to shop around and find a traditional insurance policy with a lower rate afterward.