Competition can result in dynamic improvements in value and also in service quality. A nationalised company with no competition can stagnate and be just as destructive as a commercial monopoly.

This is the propaganda put forward sure, but this argument works just as well for privatising medical insurance (Medicare is just an insurance program), roads, rail, telephony, building regulation etc. We know how those turn out.

It’s not fundamentally addressing the problem that insurance is not something you can innovate in. Something like a house costs X to rebuild, that’s somewhat flexible but at the construction level not the insurance level (unless you’re proposing vertically integrated insurance and construction?). The chance of a house being destroyed is Y per month, you charge Z such that Z - operations > Y x X

There are complicated methods of spreading the risk across multiple suburbs and such so your capital reserve isn’t anhilated in one fire but everyone must be insured so across an industry there is no efficiency to find there and the only other way to improve yield is finding ways to deny claims which just pushes the costs onto society so that is not something a government should try to encourage.

If it is not nationalised then either high risk suburbs are not insured, the government subsidises insurance in high risk suburbs which is just silly, or the government insures high risk suburbs. If the latter this is worse as private industry gobbles up the profitable suburbs and we all foot the bill for the rest.