TALLAHASSEE, Florida (Reuters) - Florida's insurance commissioner said yesterday he suspended Allstate Cos from writing new policies in the state because it had not fully complied with a subpoena to testify about its property insurance business.

"We're going to hit them where it hurts," Kevin McCarty, commissioner of the Office of Insurance Regulation, angrily told reporters.

A company spokesman could not immediately be reached for comment.

The suspension mainly affects new auto policies, since Allstate had said previously it planned to reduce its homeowner policy exposure in Florida while increasing its auto insurance business.

McCarty's action came a day after Allstate officials appeared before state regulators to testify on proposed rate increases in Allstate's property insurance business.

Company officials had been scheduled to testify for two days. But state officials called off the hearing after less than three hours when the Allstate officials refused to answer questions and to provide specific documents. Allstate requested a 41 percent rate increase after Florida lawmakers passed legislation to increase the state's hurricane catastrophe fund by $12 billion.

McCarty said the suspension would remain in effect until Allstate fully complied with the subpoena. His order bars the company from writing new policies but allows it to renew existing ones, McCarty said.

State investigators have been trying to determine if Allstate and other companies colluded to prevent property insurance rates from dropping despite the legislative action last year aimed at reducing premiums.

The issue is a major one in a state reeling from a sinking real estate market and huge increases in premiums since eight hurricanes crisscrossed Florida in 2004 and 2005, when insurers paid out about $35 billion in claims.

Allstate, the nation's largest publicly traded insurer, is among a number of companies under the microscope because of the cost of insurance in Florida, where high premiums have been blamed for driving out residents.