I hope that Hallett's article is not accepted as a rational analysis of an extremely dismal situation.
I have the following points to make:
1--I do not think that the employer groups alone are a satisfactory solution to the auto insurance problem. I have a completely unblemished 35-year driving record and the insurance carrier for the University of California, Santa Barbara, is refusing me insurance on completely trivial excuses that have nothing to do with insurance risk, trying to force me into an assigned risk pool: Unless they are regulated by an Insurance Commission that has the public interest (as opposed to the insurance companies' interest) in mind, they can be just as arbitrary with anybody else. Hallett himself (quite correctly) questions the policies of the Insurance Commission.
2--I question the 2.4% profit margin on auto insurance that Hallett brings forward. One can make a much bigger profit by having one's money idle in a bank account! At this margin the insurers would abandon California and leave insurance to the state (not a bad idea, actually. When I lived in Canada, the Province of Saskatchewan was operating a self-sufficient auto insurance with a 5% overhead, which Consumers Reports at that time rated as the best insurance available.) My experiences so far are that there is effectively no shopping around to do, contrary to Hallett's advice to the public. However, I must admit that I have never encountered similar problems in other states with compulsory auto insurance. It suggests that California lets the insurance industry get away with murder.