If an insurance company writes 10% of automobile insurance in a state, what is its responsibility?

When an insurance company writes 10% of automobile insurance in a state, it is responsible for taking on 10% of the state’s high-risk drivers. This is based on the concept of market share and risk distribution. Insurance companies spread risk among their policyholders, and if a company holds a 10% market share, it implies that it underwrites 10% of the overall risk within that market.

This responsibility means that, proportionally, the insurer will have to cover a part of the state's high-risk drivers, reflecting the risk associated with those individuals. High-risk drivers are typically those who may have a history of accidents, traffic violations, or other factors that increase the likelihood of filing a claim. By taking on their share of high-risk drivers, the insurance company participates in a fair distribution of risk that corresponds to its share of the overall market.