At the moment the insurance companies charge for third party insurance according to their assessment of risk. This means new or young drivers pay a massive premium. It imposes an unfair burden on the young, and it's a temptation to drive uninsured. If you are compelled to buy something, then it's only fair that the price should be controlled. If it's linked to the road fund licence, nobody can evade it, and everyone pays the same fixed price. Extra insurance, for fire, theft, collision damage, breakdown, legal advice etc, would continue to be voluntary and would be priced accordingly. The third party element could be subsidised from that.
Establish a fixed cost for third party insurance and link the cost to the annual road fund licence. It means all drivers are automatically insured for the legal minimum, and it stops the insurance companies ripping drivers off for something they are legally obliged to buy.