Automobile Reinsurance Facility

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Automobile Reinsurance Facility

An insurance plan for drivers who otherwise would not be able to obtain automobile insurance. Each state in the U.S. requires insurers to offer an automobile reinsurance facility, at a higher premium. States assign their uninsurable driver to an insurance company, which must provide coverage. This helps people who, by law, must obtain automobile insurance, but are unable to do so because of a poor driving record or for some other reason. Critics contend that it drives up premiums for all policyholders. It is also called the automobile shared market or automatic assigned risk insurance.