We have that now. It is called Citizen's Insurance. Funded by the state, it has the highest premiums, and is broke. There is a pass-through charge on all insurance policies from all carriers to bail it out. What the companies are doing is dumping those near the coast, and keeping those safely inland. Basically cherry picking the best ones, and letting the potential losers go to Citizens, keeping it in the red.
Insurance companies make all their money on car insurance and investments. Homeowner policies are a loser (or break even at best). Car insurance profits have subsidised Homeowners for years.
I have no problem with any company making money. Even a lot of money. I do not even know if this is the right move. But something...SOMETHING needs to be done.
Now.
And one problem with Citizens is that private insurers drop even the tiniest risk policies and keep all the low risk policies. That means it's Citizens, not the private companies, that take the hit when there is a bad hurricane. And don't forget that hurricane coverage is separate from the rest of your homeowners policy.