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I find it hard to believe that a far market can exist when everyone is required or effectively required to purchase something. If you think of supply and demand, the demand for something like health insurance or legally mandated car insurance is effectively infinite.
The decision to get car insurance or not is not “is the value this car insurance provides worth the money” it’s “is the value this car provides worth the money”. Similarly, the value of health insurance becomes the value of getting any sort of medical treatment, because it’s generally impossible to get treatment otherwise.
This allows the insurance companies to charge rates far beyond the value they actually provide, because they are legal gatekeepers to far more valuable opportunities.
Assuming that demand for car insurance is artificially inflated because people are mandated to purchase it, wouldn't an open market still drive down prices due to competition? Another market that has even more demand is food. People aren't even legally mandated to buy food. They either buy it or die. There may be a few people that can grow enough of their own food to sustain themselves without ever purchasing it, but I would guess that there are more people that make enough money to live without insurance than people that grow all of their own food. Despite that, food seems to be relatively affordable. If one food vendor is charging too much or I don't like their product, I can easily go to a competing food vendor and purchase there. Adam's invisible hand then ensures that the market provides an efficient quality-to-price ratio. I'm not arguing it's perfect, but we don't hear about how food stores are ripping us off as much as we do about insurance companies. My argument is that despite there being inflated demand, the insurance companies still have to compete with each other for those customers, which would have a considerable impact on price. Let's say we all buy cars that are valued at $20k. If one company is providing insurance for $100/month and the other company is charging $150/month, everything else being equal, the former would earn more customers.
Also, since demand is high, I think it would LOWER rates. Here's why. If insurance was not mandated, then the people that would get it would include everyone that thinks they may need it. The ones that think they will not use it will avoid wasting their money since they're not receiving anything in return. That means that there will be less contributions and more expenditures from the pooled money, making insurance more expensive. Mandate insurance makes it so that even the people that will not use it contribute to the pool, so everyone's costs are lower than otherwise. Of course, this would only happen in a market that allows for competition. Otherwise, if there were only one insurance provider, they would be in a position to price gouge everyone since the only other option would be to break the law.