Why did governments pass laws requiring auto insurance historically?

Governments historically passed laws requiring auto insurance primarily to protect individuals from the risks associated with automobile use. The rationale behind this was the recognition of increased car usage leading to higher accident rates, which could result in significant financial burdens for drivers involved in accidents. By mandating auto insurance, governments aimed to ensure that all drivers had a minimum level of financial protection for themselves and others affected by crashes. This requirement helps to cover medical expenses, property damage, and liability claims, fostering a system that promotes safer driving practices and financial responsibility among drivers.

The emphasis on protecting individuals from auto risks is central to understanding why these laws were deemed necessary. They create a safety net for those who might otherwise struggle to pay for damages resulting from an accident, thereby also contributing to public welfare and road safety initiatives.