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22-02-2024
Business

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The state of Maryland operates a residual auto plan (the Maryland Auto Insurance Fund—MAIF) that provides coverage for drivers who are unable to obtain coverage from private insurers. Which one of the following is the best rationale for the MAIF program?
Select one:
A. Private insurers face limited competition, and the state increases competitive pressures by operating this type of plan.
B. Auto insurance for high-risk drivers is profitable, and the program enables the state to share in the profits.
C. Auto insurance is compulsory, and the program makes it possible for all drivers to have reasonably priced insurance.
D. Private insurers overcharge for auto insurance, and the state provides a low-cost alternative.

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