Final answer:
The subject of this question is Social Studies. Governments often require individuals to purchase certain kinds of insurance, like auto insurance for car owners. This legal requirement helps ensure that everyone is financially responsible for any damages they may cause.
Step-by-step explanation:
The subject of this question is Social Studies, specifically related to the topic of government intervention in insurance markets.
Governments often require individuals to purchase certain kinds of insurance, like auto insurance for car owners. This legal requirement helps ensure that everyone is financially responsible for any damages they may cause.
In the case of car insurance, each driver pays a premium to the insurance company. If there are 100 drivers who each pay a premium of $1,860 per year, the insurance company will collect a total of $186,000, which is used to cover the costs of accidents.