The Golden State isn't so, well, golden, for the insurance industry.

After receiving a 'D' grade in R Street's Insurance Regulation Report Card in 2013, California followed it up with, you guessed it, an 'F' for 2014.

Vermont followed up its second place rank in 2013 by flipping positions with Virginia to claim the top spot in 2014. Showing a slight improvement, this year eight states received 'A' grades, compared to seven in 2013.

R Street, a free market think tank, aims to answer three questions for each state in its research:

How free are consumers to choose the insurance products they want?
How free are insurers to provide the insurance products consumers want?
How effectively are states discharging their duties to monitor insurer solvency, police fraud and consumer abuse and foster competitive, private insurance markets?

The annual report card tracks 12 categories to determine how well states: monitor insurer solvency; police fraud; respond to consumer complaints; how efficiently they spend the insurance taxes and fees they collect; how competitive their home, auto and workers' comp insurance markets are; the degree to which they permit insurers to adjust rates and employ rating criteria as they see fit; the transparency and politicization of insurance regulation in the states; and finally, states' willingness to take part in cutting-edge regulatory modernization initiatives.

Details on how each state ranked per category can be found in the full report.

First, the good news. Here are the states that received 'A' grades.

1. Vermont

Grade: A+

Total score: 76.9

Strengths: Consumer protection, low politicization, auto insurance market, home insurance market, workers' comp market, rate freedom, regulatory clarity, few rating restrictions

Weaknesses: Fiscal efficiency

2. Virginia

Grade: A

Total score: 73.9

Strengths: Solvency regulation, low politicization, auto insurance market, home insurance market, workers' comp market, few rating restrictions, regulatory modernization

Weaknesses: None

3. Illinois

Grade: A

Total score: 72.5

Strengths: Low politicization, fiscal efficiency, workers' comp market, rate freedom, regulatory clarity, few rating restrictions

Weaknesses: Fraud, little regulatory modernization

4. Iowa

Grade: A

Total score: 71.9

Strengths: Low politicization, fiscal efficiency, auto insurance market, home insurance market, workers' comp market, few rating restrictions, regulatory modernization

Weaknesses: None

5. Maine

Grade: A-

Total score: 70.8

Strengths: Solvency regulation, consumer protection, low politicization, fiscal efficiency, auto insurance market, home insurance market, few rating restrictions

Weaknesses: None

6. Utah

Grade: A-

Total score: 69.9

Strengths: Antifraud, low politicization, fiscal efficiency, auto insurance market, home insurance market, few rating restrictions, regulatory modernization

Weaknesses: Solvency regulation, little regulatory modernization

7. Ohio

Grade: A-

Total score: 69.7

Strengths: Low politicization, fiscal efficiency, auto insurance market, home insurance market, rate freedom, regulatory clarity, few rating restrictions

Weaknesses: Workers' comp market

8. Kentucky

Grade: A-

Total score: 69.5

Strengths: Regulatory clarity, workers' comp market, few rating restrictions

Weaknesses: Politicization, fiscal efficiency

Next page: States that received a 'B' grade

9. Idaho

Grade: B+

Total score: 67.4

Strengths: Solvency regulation, antifraud, consumer protection, low politicization, auto insurance market, home insurance market, few rating restrictions

Weaknesses: Workers' comp market, little regulatory modernization

10. New Jersey

Grade: B+

Total score: 67.4

Strengths: Antifraud, low politicization, auto insurance market, home insurance market,

Weaknesses: Little regulatory modernization

11. Minnesota

Grade: B

Total score: 66.7

Strengths: Antifraud, low politicization, fiscal efficiency, home insurance market, few rating restrictions

Weaknesses: None

12. Indiana

Grade: B

Total score: 66.7

Strengths: Low politicization, fiscal efficiency, auto insurance market, home insurance market, workers' comp market, few rating restrictions, regulatory modernization

Weaknesses: Solvency regulation, consumer protection

13. Nebraska

Grade: B

Total score: 66.4

Strengths: Low politicization, fiscal efficiency, auto insurance market, workers' comp market, few rating restrictions

Weaknesses: Little regulatory modernization

14. Wisconsin

Grade:B

Total score: 66.3

Strengths: Low politicization, auto insurance market, home insurance market, workers' comp market, few rating restrictions

Weaknesses: Fraud

15. Colorado

Grade: B

Total score: 66.0

Strengths: Solvency regulation, low politicization, fiscal efficiency, auto insurance market, home insurance market

Weaknesses: Workers' comp market

16. Nevada

Grade: B

Total score: 66.0

Strengths: Solvency regulation, low politicization, auto insurance market, home insurance market, workers' comp market, few rating restrictions

Weaknesses: Little regulatory modernization

17. Wyoming

Grade: B

Total score: 65.3

Strengths: Solvency regulation, low politicization, fiscal efficiency, auto insurance market, rate freedom, few rating restrictions

Weaknesses: Workers' comp market

18. Kansas

Grade: B

Total score: 65.2

Strengths: Fiscal efficiency, auto insurance market, home insurance market, few rating restrictions, regulatory modernization

Weaknesses: Politicization

19. Oregon

Grade: B

Total score: 65.1

Strengths: Solvency regulation, low politicization, auto insurance market, home insurance market, workers' comp market, rate freedom, few rating restrictions

Weaknesses: Consumer protection

20. Arizona

Grade: B

Total score: 64.7

Strengths: Low politicization, auto insurance market, home insurance market, workers' comp market, rate freedom, few rating restrictions

Weaknesses:Consumer protection

21. Missouri

Grade: B

Total score: 64.5

Strengths: Low politicization, fiscal efficiency, home insurance market, workers' comp market, rate freedom, regulatory modernization

Weaknesses: Solvency regulation

22. Tennessee

Grade: B

Total score: 64.4

Strengths: Solvency regulation, low politicization, workers' comp market, rate freedom, few rating restrictions

Weaknesses: Fiscal efficiency

23. New Mexico

Grade:

Total score: 64.0

Strengths: Solvency regulation, low politicization, auto insurance market, workers' comp market, few rating restrictions

Weaknesses: Fiscal efficiency

24. Rhode Island

Grade: B

Total score: 63.9

Strengths: Low politicization, fiscal efficiency, auto insurance markets, regulatory modernization

Weaknesses: Antifraud

25. Pennsylvania

Grade: B-

Total score: 62.9

Strengths: Low politicization, auto insurance market, home insurance market, workers' comp market

Weaknesses: Solvency regulation

26. New Hampshire

Grade: B-

Total score: 62.0

Strengths: Antifraud, low politicization, auto insurance market, home insurance market, workers' comp market

Weaknesses: Solvency regulation, desk drawer rules, little regulatory modernization

27. Connecticut

Grade: B-

Total score: 61.4

Strengths: Fiscal efficiency, auto insurance market, home insurance market, workers' comp market

Weaknesses: Rate regulation, desk drawer rules, little regulatory modernization

28. Texas

Grade: B-

Total score: 61.3

Strengths: Solvency regulation, low politicization, auto insurance market, few rating restrictions

Weaknesses: None

Next page: States that received a 'C' grade

29. South Dakota

Grade: C+

Total score: 60.9

Strengths: Antifraud, low politicization, auto insurance market, home insurance market, workers' comp market

Weaknesses: Solvency regulation, little regulatory modernization

30. Alabama

Grade: C+

Total score: 60.4

Strengths: Low politicization, auto insurance market, few rating restrictions, regulatory modernization

Weaknesses: Rate regulation, desk drawer rules

31. Alaska

Grade: C+

Total score: 59.8

Strengths: Antifraud, consumer protection, low politicization

Weaknesses: Little regulatory modernization

32. South Carolina

Grade: C+

Total score: 59.6

Strengths: Low politicization, auto insurance market, home insurance market, workers' comp market, regulatory clarity, few rating restrictions

Weaknesses: Solvency regulation, fraud, little regulatory modernization

33. North Dakota

Grade: C+

Total score: 59.1

Strengths: Antifraud, consumer protection, fiscal efficiency, auto insurance market, home insurance market, few rating restrictions

Weaknesses: Workers' comp market, little regulatory modernization

34. Arkansas

Grade: C

Total score: 58.6

Strengths: Antifraud, auto insurance market, home insurance market, low politicization, few rating restrictions

Weaknesses: Solvency regulation, fiscal efficiency, desk drawer rules, little regulatory modernization

35. Maryland

Grade: C

Total score: 57.9

Strengths: Solvency regulation, low politicization, fiscal efficiency, home insurance market, workers' comp market

Weaknesses: Desk drawer rules

36. Georgia

Grade: C

Total score: 57.2

Strengths: Solvency regulation, auto insurance market, workers' comp market, regulatory modernization, few rating restrictions

Weaknesses: Desk drawer rules

37. West Virginia

Grade: C

Total score: 56.8

Strengths: Solvency regulation, antifraud, low politicization, home insurance market, few rating restrictions

Weaknesses: Fiscal efficiency, little regulatory modernization

38. Oklahoma

Grade: C

Total score: 55.3

Strengths: Solvency regulation, auto insurance market, few rating restrictions

Weaknesses: Home insurance market, little regulatory modernization

39. Delaware

Grade: C-

Total score: 54.5

Strengths: Antifraud, fiscal efficiency, home insurance market, workers' comp market, few rating restrictions

Weaknesses: Desk drawer rules, little regulatory modernization

Next page: States receiving a 'D' grade

40. Florida

Grade: D+

Total score: 52.3

Strengths: Antifraud, fiscal efficiency, auto insurance market, workers' comp market, regulatory modernization

Weaknesses: Home insurance market, rate regulation, desk drawer rules

41. Mississippi

Grade: D+

Total score: 51.9

Strengths: Solvency regulation, auto insurance market, workers' comp market, few rating restrictions

Weaknesses: Desk drawer rules, little regulatory modernization

42. Washington

Grade: D+

Total score: 51.3

Strengths: Auto insurance market, home insurance market

Weaknesses: Workers' comp market, little regulatory modernization

43. Louisiana

Grade: D

Total score: 50.8

Strengths: Regulatory clarity, workers' comp market, few rating restrictions

Weaknesses: Politicization, fiscal efficiency

44. Michigan

Grade: D

Total score: 50.5

Strengths: Fiscal efficiency, home insurance market, workers' comp market

Weaknesses: Fraud, auto insurance market, little regulatory modernization

45. Massachusetts

Grade: D

Total score: 49.1

Strengths: Low politicization, home insurance market, workers' comp market

Weaknesses: Fiscal efficiency, desk drawer rules, little regulatory modernization

46. New York

Grade: D

Total score: 48.4

Strengths: Low politicization, home insurance market, few rating restrictions

Weaknesses: Fiscal efficiency, desk drawer rules, little regulatory modernization

47. Hawaii

Grade: D

Total score: 48.0

Strengths: Solvency regulation, fiscal efficiency, workers' comp market

Weaknesses: Home insurance market

48. Montana

Grade: D-

Total score: 46.7

Strengths: Antifraud, auto insurance market, home insurance market

Weaknesses: Solvency regulation, fiscal efficiency, workers' comp market, little regulatory modernization

Next page: States that received a failing grade

49. North Carolina

Grade: F

Total score: 44.9

Strengths: Workers' comp market, regulatory clarity

Weaknesses: Solvency regulation, consumer protection, auto insurance market, rate regulation, little regulatory modernization

50. California

Grade: F

Total score: 44.2

Strengths: Antifraud, fiscal efficiency, auto insurance market, workers' comp market

Weaknesses: High politicization, rate regulation, desk drawer rules, rating restrictions, little regulatory modernization

Special Reports /

School's in session: Here are the 2014 insurance regulation report cards for all 50 states

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