CAARP ( the California Automobile Assigned Risk Plan)

CAARP, or the California Automobile Assigned Risk Plan, is not an insurance company. It is an entity that was created by the California state legislature in 1947 to help people obtain automobile liability insurance through conventional insurance company. It helps those people who are entitled to or obligated to carry automobile insurance but who are having difficulty obtaining it because of their driving record, insurance claims history or other factors. The organization acts as a facilitator; if an individual is unable to find automobile insurance through their own efforts or is dropped by their current insurer for issues other than non-payment, they can contact the organization. CAARP will step in and find an insurance company to sell a policy to the individual.

California is one of the states with financial responsibility laws: automobile insurance is a requirement. Insurance companies doing business in the state of California are obligated to participate in this program. The amount of policies that the insurer is required to write for CAARP depends upon how much business the company is doing in the state. For example, if an insurance company insures five percent of the automobiles in California, the Assigned Risk Plan requires that the insurance company insure five percent of the people in the assigned risk plan.

Anyone with a valid driver’s license and no outstanding insurance bills due (within the past 24 months) can apply for insurance through CAARP. The person must be able to state that they tried to find an automobile insurance policy on their own and were unsuccessful.

You will only be able to purchase the minimum liability insurance limits (15/30/5) with CAARP’s help, unless your circumstances legally require higher limits. First party physical damage coverage is not available. Because you will only be able to get minimum limits with the organization's help, it really is best that you try to obtain your own insurance policy quotes first anyway.

It is important to remember that this is not an actual insurance company; it is an organization to help the individual find automobile insurance with an insurance company doing business in the state of California. Once a policy is found with such a company, that insurance company bills for the policy, services the policy and handles any claims for loss or accident that might arise. Any questions about the specific policy or requested changes (such as adding or changing a vehicle or driver) will need to be addressed by that insurer.

If you live in the state of California and have tried to obtain or keep an automobile insurance policy on your own, but have been turned down because of your driving record or other factors that make you a high risk driver (NOT because you failed to pay your insurance bill), you may call CAARP for help at 1-800-622-0954.

If you have been helped by the California Automobile Assigned Risk Plan in the past, our online community would appreciate hearing about your experience. Was the organization helpful to you or not? How quickly were you able to obtain an automobile insurance policy with their help? Please share your story, comments or tips in the webform below (Have something to share about this topic?). Our readers thank you.

This article is approved for informational purposes only and is not intended to take the place of competent local legal counsel. The writer is not affiliated with the California Automobile Assigned Risk Plan in any way.

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