We are done here.
The state is telling them they have to either eat the loss (or quit lying) if they want to sell auto insurance there. Auto insurance in FL is a big and profitable plum, so the revenue stream may be worth it. In the long run, though, the people will be WORSE off by state intervention. They always are.
In several states, individuals are free to pool and "self insure" by forming a "mutual" insurance company. For example, in North Carolina, the assets requirement is only $100,000 to form a Mutual Insurance company. If a group of people, say 20 families, can come up with 5 thousand dollars apiece, then they can "self insure" as long as the policies meed the state requirements. Everybody sticks 5 grand in the pot, everyone pays a thou a year, and any "profits" go back to the stockholders (by definition in a mutual company, it is the policyholders). So, why are there not thousands of little companies springing up in NC, OH, IN and other states with similiar laws? BECAUSE THEY CANNOT COMPETE WITH THE BIG BOYS!!!! That is right. The evil exploitative insurance companies have actually driven the prices to the minimum they can afford and still be profitable (it is called "competition"). The small mutuals are actually selling out to the Allstates, the State Farms and the Nationwides of America.
However, if the markets are really as screwed up as you claim they are, there is no reason why the state legislature could not be petitioned to allow smaller insurance collectives to operate as self insurance companies. They can always buy "reinsurance" against major disasters....., the big companies already do that.
That is just ONE off the top of my head potential to alleviate the insurance pressure in Florida, and it doesn't involve the state dinking around with the markets. It just expands the field for more competition. To be fair, a bunch of smaller home/fire companies went bust in the last hurricane and could not pay their claims. They went into receivership and the big guys bought up what little assets ---future cash flow-- they had. Might be a tough regulatory nut to crack there.
In several states, individuals are free to pool and "self insure" by forming a "mutual" insurance company. For example, in North Carolina, the assets requirement is only $100,000 to form a Mutual Insurance company. If a group of people, say 20 families, can come up with 5 thousand dollars apiece, then they can "self insure" as long as the policies meed the state requirements. Everybody sticks 5 grand in the pot, everyone pays a thou a year, and any "profits" go back to the stockholders (by definition in a mutual company, it is the policyholders). So, why are there not thousands of little companies springing up in NC, OH, IN and other states with similiar laws? BECAUSE THEY CANNOT COMPETE WITH THE BIG BOYS!!!! That is right. The evil exploitative insurance companies have actually driven the prices to the minimum they can afford and still be profitable (it is called "competition"). The small mutuals are actually selling out to the Allstates, the State Farms and the Nationwides of America.
However, if the markets are really as screwed up as you claim they are, there is no reason why the state legislature could not be petitioned to allow smaller insurance collectives to operate as self insurance companies. They can always buy "reinsurance" against major disasters....., the big companies already do that.
That is just ONE off the top of my head potential to alleviate the insurance pressure in Florida, and it doesn't involve the state dinking around with the markets. It just expands the field for more competition. To be fair, a bunch of smaller home/fire companies went bust in the last hurricane and could not pay their claims. They went into receivership and the big guys bought up what little assets ---future cash flow-- they had. Might be a tough regulatory nut to crack there.