Have you ever stopped to wonder why car insurance is mandatory, but other types of insurance, such as health care, are not? In the United States of America, all states require some form or car insurance except New Hampshire, which is the only state that does not require it.
Car insurance is mandated at the state level, so this allows each individual state to determine the regulation. States acting as individual powers can place any mandate they see fit on their residents, as long as it is not in violation of the restrictions placed on states in the constitution. Due to plenary power, states have more power to mandate necessary insurance policies than the federal government does. This may leave you wondering why 49 out of 50 states have chosen to mandate car insurance for their residents. There is no straight answer since it varies from state to state, but there are overarching benefits of mandating some type of car insurance, specifically liability insurance, for drivers.
As you’re most likely well aware, driving can be dangerous. It’s not something we want to think about when we’re out on the road, but it is a fact of life. We are human, and humans make mistakes. Making certain mistakes behind the wheel can be costly, and even potentially deadly. Picture the following situation. You’re driving along the road on the way to a nice dinner with friends and suddenly a driver rear ends you going 50 MPH. It smashes in the whole back end of your car in, totaling your car, and you get injured, causing you to need to go to the chiropractor. If the person who hit you didn’t have liability insurance, you’d probably be pretty upset. This is why most states mandate it. The benefits of mandating liability car insurance outweigh the costs.