I wonder if the FAA will initiate an action, and if so will the insurance
carrier cover the loss?

At the very least this falls under the "careless and negligent" rule.

Why does it seem like there's a disproportionate number of Cirrus flyers
making questionable flying decisions- losing control at high altitude and
popping the chute, taking off into low IMC after major maintenance, etc.

There is a Cirrus owner on our field who gained himself the nickname "super
pull up"- he would accelerate down the runway at low altitude after
rotating, and then do a high g chandelle type maneuver. This usually
occurred in front of a bunch of experienced warbird/aerobatic pilots, all of
whom weren't too impressed.

The guy finally overheard someone refer to him as "super pull up" one day,
and got the hint.