The result is a distortion of price signaling: The rate requests don't necessarily reflect what companies really want, and the final premiums don't necessarily reflect what they really need. (timesunion.com)
But capital is allocated based on price signals given by the markets. (hussmanfunds.com)
And it requires the operation of a market system that will send price signals as to what works and what does not. (carlineconomics.com)