• Auto Insurance: What Assigned Risk Means

    Assigned risk is insurance of the last resort, and if you have been put in a assigned risk pool it will probably result in a much higher premium. Assigned risk insurance allows drivers to continue to drive legally even though they no longer qualify for traditional insurance.

    What Does It Mean?

    Assigned risk is an insurance industry term that is used to refer to clients that insurance companies are required by state law to cover but would otherwise be ineligible for insurance coverage. These clients are usually pooled by the state and then distributed by the DMV to various insurance companies. The majority of the states require all drivers to have insurance.

    Why?

    People end up in an assigned risk pool when they can no longer qualify for insurance coverage on the open market. There are many ways to end up as a high risk driver. It could result from multiple DUI’s, accidents or a large number of speeding tickets. It can also be because of a large number of points that have accumulated on your drivers license. However people get there, they are no long insurable.

    Coverage

    Each state has different qualifications as to when a person will be put into an assigned risk pool. The majority of states require you to be turned down at least 3 times from standard insurance companies before you can apply for an assigned risk pool. Insurance companies are required to offer these people coverage although the rates will typically be higher.

    Getting out?

    Many insurance companies will reconsider you for coverage if you manage to go 3 years without an accident or accumulating any points on your license.

    While being put in an assigned risk pool can be expensive, at the very least it allows high risk drivers to have insurance coverage until they manage to get their driving record back in order.