The California Automobile Assigned Risk Plan (CAARP) was created in 1947 by the state legislature to make sure that all drivers on the road are protected by auto insurance.
The California Automobile Assigned Risk Plan is California’s residual auto insurance market, which is also called the non-standard market.
As a responsible manager, you need to be aware of these risks.
Does this mean that you should try to address each and every risk that your project might face?
By law, licensed auto insurance providers in California establish an approved Driver Class Plan, by which all drivers are grouped into one of several classes by their profile and driving records.
Each insurer has its own risk assessment method, but the higher risk class they assign you to, the higher your insurance costs will be.
High-probability/high-impact risks are the most critical, and you should put a great deal of effort into managing these.
The low-probability/high-impact risks and high-probability/low-impact risks are next in priority, though you may want to adopt different strategies for each.
A policy through the CAARP does not mean that it will be more affordable than if you go through the regular voluntary market.
It is merely a guarantee that you will get insurance for you and your vehicle when everyone else has rejected you.