What is a primary goal of the Residual Market/State FAIR Plan?

The primary goal of the Residual Market, often represented by State FAIR Plans, is to ensure fair access to insurance for individuals who are unable to obtain coverage through standard insurance channels. This is particularly important for high-risk individuals or properties that could be systematically denied coverage by traditional insurers due to their circumstances, such as a history of losses or residing in areas prone to natural disasters.

By creating a safety net through state-managed plans, the objective is to provide these individuals with a viable option for insurance, thereby promoting equity in access to insurance protection. This aligns with the broader principle of ensuring that all members of society have access to essential services, in this case, insurance, regardless of their risk profile or market conditions that might otherwise exclude them.

Options that suggest increasing insurance rates for everyone or providing specialized life insurance coverage do not align with the core purpose of ensuring access for high-risk individuals. Additionally, while the idea of eliminating the need for private insurance might seem appealing in certain contexts, it contradicts the purpose of the Residual Market, which aims to supplement the existing private insurance framework rather than replace it.