Which type of insurance companies are required to participate in a state's automobile assigned risk plan?

The requirement that all licensed insurance companies that sell auto insurance in the state participate in an automobile assigned risk plan is grounded in the necessity to ensure that all drivers have access to insurance, regardless of their driving history or risk profile. This participation helps to stabilize the insurance market and ensure that high-risk drivers are not left without coverage, which could lead to increased uninsured motorist rates and greater risk for public safety.

By mandating that all licensed carriers contribute to the assigned risk pool, the state can efficiently spread the risk of insuring higher-risk individuals across a larger group of insurers. This helps to keep premiums more affordable for those who may be classified as higher risk due to factors such as previous accidents or traffic violations.

In contrast, other options suggest limitations based on the volume of policies written, company size, or specific types of insurance companies, which would undermine the purpose of the assigned risk plan. The overarching goal is inclusivity and market stability, which can only be achieved through universal participation by all entities authorized to provide auto insurance in that state.