If insurance companies were allowed to sell across state lines, there would be a race to the bottom among crappy red states. Some state like Mississippi would have an insurance board that is totally corrupt and filled with insurance plants. They would approve all sorts of scam policies that were completely useless and not pay out anything when the purchaser needed it. Then being approved in Mississippi, these companies would then sell their scam policies across the country. They would make billions legally scamming people. That doesn't work.

I'm not sure that would even legally be the outcome.

You're allowed to "sell" contractual arrangements across state lines, absent state laws prohibiting same. But when you do, you're often governed by the laws in the state where the transaction occurs, which is usually where the customer is. For example, if you sell a warrantee for a consumer good, that contract (itself a type of insurance) is going to be subject to the consumer protection rules of the state in which the product is sold.

So "buying insurance across state lines" doesn't mean that your insurance policy would be immune from the laws of your own state. If you buy insurance from a Mississippi-based insurer, your home state law can (and almost certainly would purport to) still regulate that contract. If your home state has rules about what health insurance has to look like, or how it has to be sold, or what terms govern that contract, etc., they probably can enforce those rules against insurance companies when they do business in the state. Even if the insurance company itself is located outside the state. Especially after National Pork Producers Council v. Ross.

Note: choice of law is an insanely complicated issue, and none of this is at all legal advice.