By Insure.com

It's the last resort, but for some drivers, it's your only option. Here's how auto insurance works if your record isn't so clean.

You've just had your fourth accident in the past 12 months and you've received notice that your insurance company is canceling your auto insurance. After checking with other insurance companies, you find that none will insure you. Where do you go now?

Unfortunately, the news is not good. You can continue trying to buy a policy with other auto insurers, of course. But if that fails, in most cases you'll need to get insurance from your state's insurer of last resort, which is also known as the assigned-risk pool.

Three strikes and you're in

Every auto insurer that does business in a particular state must participate in the state's assigned-risk pool -- it's a way for a state to make sure there's always an avenue for buying auto insurance in order to reduce the number of uninsured drivers. The amount of business a company does in the state determines how many drivers from the pool it must insure. Drivers who fall into the assigned-risk pool are assigned randomly to a company, says John Verruso, spokesman for the Automobile Insurance Plans Service Office (AIPSO).

If you contact your insurance agent and say you were turned down three times, he or she will have you fill out a form to apply for insurance from the assigned-risk pool. Generally, you don't need to supply photocopies of your three denials of coverage, but you usually need to certify in writing that three companies have turned you down.

Rates will not vary among companies insuring assigned-risk drivers but, rather, rates will be determined by the extent of your on-road mistakes. Just as in the voluntary insurance market, information such as where you live and your driving record will affect your premium, according to Verruso. This factor alone makes it worth it to keep your driving record as clean as possible, since someone with six speeding tickets will pay less than someone with six speeding tickets who also has caused three accidents.

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