Fully insured. They likely had liability but couldn't get full coverage, which is perfectly legal.
It's hard for me not to go off on speculation like this. Bunch of random assumptions for no reason. You can look up the requirements. For my state it's a weight/passenger limit.
In many states, driving a vehicle uninsured is a crime. They're admitting they've been committing this crime for quite awhile?
The mandatory insurance tends to be liability insurance, for injuries. Insurance may not be mandatory on the cost of the vehicle itself. It would not surprise me if their insurer didn't want to write a collision policy until some time had passed. (Particularly since they also seem to be living in it, I'm sure that has an affect on insurance.)
Do they have the proper license?
It's not out of the realm of possibility that one of them had a CDL, there are all sorts of jobs that require them and the company would pay for the training. Heck, my local school district is always trying to find more bus drivers, they would pay for the CDL if you agreed to drive a bus full of snotnosed middle schoolers every day
RVs do not require a CDL and this bus was being used as one. CDLs are required, generally, when hauling more than 15 passengers or using a heavy vehicle for commercial purposes.
In many states, driving a vehicle uninsured is a crime. They're admitting they've been committing this crime for quite awhile?
In many states (mine included), you don't technically need insurance. You have to show proof of financial responsibility, and that only has to meet some surprisingly low standards. IIRC, you only have to prove you can pay for $7,500 in damages. Or if you meet certain other criteria, you can self-insure.