So now you have a widely distributed system of insurers to deal with making the rules, rather than people I've elected to represent my interests? (Even if said elections don't always go my way.)

Who are those insurers beholden to, what are their incentives to represent the consumer in any way?

I don't mean to imply that this invalidates your reasoning, but I thought it would be interesting to point out that Underwriters Laboratories was a private organization funded by insurance companies and did, and still does, a great job making electrical systems safer.

Some people would like to see more things like that.

> Who are those insurers beholden to, what are their incentives to represent the consumer in any way?

Their incentives to represent the consumer are rooted in the fact that the consumer can switch to another insurance company. Which means that if one has overly strict requirements without charging correspondingly lower premiums, nobody will use them. Then you get the incentives you want: People prefer both lax requirements and low premiums and the insurance companies have the incentive to find a better balance than competing insurance companies.

> Their incentives to represent the consumer are rooted in the fact that the consumer can switch to another insurance company.

Two follow ups:

1) Isn't this inefficient? E.g. insurance is most efficient the larger the pool is. Doesn't this system introduce inefficiencies (and therefore risk) into the market?

2) Do you feel like there are adequate tools to choose between different insurers today, and do you expect that everyone who owns or improves property should be reasonably expected to make an informed decision about which insurance company to go with? It's hard enough now to insure my car, let alone all the individual decisions that go into building a house. (From materials to design decisions to occupancy rates to the health of the occupants, etc.)