The main purpose of the licensing is to protect the monopoly position of the existing operators. The safety issue is a red herring.
Historically, not entirely, although it certainly has been used as such, a mutual relationship parasitic on the taxpayer. The reality is that insurance companies have little interest in actually managing risk, in part because lawyers have so inflated both the cost of proceedings and damage awards far beyond the attendant risk but also because insurers, itself a heavily regulated business for the benefit of the big players, only want to play with money and don't give a rip about the messy details as long as they can keep raising the rate base.
In other words, it's a structural problem with lots of fingers in the pie.