Florida Insurance Commissioner Kevin McCarty, in a harshly worded order, has told State Farm it can go forward with its plan to exit the state's homeowners insurance market, but only under stringent conditions he has set to protect policyholders.

The company--which has 1.2 million home and condominium policyholders in the state--will not be allowed to dump its customers on Citizens Property Insurance Corp., the state-run insurer of last resort, under the order, which also said that State Farm should allow its agents to place policies with other private insurers.

The order called the State Farm argument that it needs to withdraw because it faces the danger of insolvency and inability to play claims "both disingenuous and misleading." State Farm, the order said, "created its current 'crisis' by failing to pursue the opportunities that were available to reduce its expenses and mitigate its decrease in premium volume."