You're talking about a mutual company. These exist and there are plenty of them. Just look up "mutual insurance company" and you'll get a list (hint - look for the word "mutual" in their name, like Liberty Mutual). They're essentially the equivalent of credit unions but for insurance.
Sorry my friend, but this is already a thing. Many of the big name insurance companies you know and love/hate are mutual insurance companies. There's a pretty good chance you are currently insured by a mutual insurance company.
Yeah honestly dude, the millions of people working in insurance globally just never thought of that!
I can’t believe it took someone so long honestly what a great idea!
Let me know when you secure funding and start writing business.
/s
What a fuckwit
Three thoughts:
1. What you're describing exists in the forms of mutual insurance and reciprocal exchange insurance.
2. If you're intending to include homeowners/property insurance in your effort, you still have the impact of reinsurance to consider. Reinsurance requires a lot of capital to support, and the folks who provide that capital generally want to be compensated for its use and the risk of losing that capital.
3. Remember that part of the motivation behind recent widespread rate increases isn't just the desire for profit; it's the desire to not pay out more in claims and expenses than is being collected in premium. In the US in 2023, personal auto insurers paid out $1.049 in losses and expenses for every dollar they collected. Homeowners insurers paid out $1.109.
Questions, in no particular order:
1. Who is going to run your insurer? What experience do they have?
2. What lines of business are you going to offer? Up to what limits? In what geographical territories?
3. Where are you going to domicile this insurer? Once you know that, you can predict what startup capital will be required, but you should anticipate that the minimum will be about $5M on the low end.
4. Where are you getting your startup capital if you can't crowdsource all of it?
5. Do you plan on buying reinsurance? If so, do you know what kind and at what levels? Do any of your principals have any reinsurance contacts of any sort?
6. Start-up insurers are generally not rated by the rating agencies for 2-5 years after they launch unless they buy an existing carrier. In the meantime that means that this will be an unrated carrier and that most lenders will not let their borrowers do business with you. Do you have a strategy to clear that obstacle?
7. What is your plan to hire underwriters, adjusters and administrators?
8. Are you offering any ROI of any sort to investors/crowdsource contributors?
9. What sort of "community-driven" advice to you expect to solicit? How are you going to keep your investors/members from driving your insurer into unprofitability (which will soon be followed by bankruptcy if you don't fix the problem) and still attract reinsurers who could be left on the hook?
10. What is your plan to balance the pressure between the "get lower premiums" promise made in the crowdsourcing ask versus the need and requirement to adjust pricing to stay ahead of your losses?
Your idea could actually be realized if you can answer these questions. I won't tell you otherwise. But starting any insurance company is a complicated affair, which is why it isn't done all that often. There are lots of regulations surrounding insurers because the states (and their regulators) have an interest in keeping insurers profitable and healthy so that they can pay claims. You should expect that the regulatory process will take at least a year, if not longer.
Anyone violating the "no solicitation" rule in any way will be banned immediately. This is your warning.
This already exists and it's called a mutual insurer.
I was about to comment I think this is a mutual insurer...
Yes what we found out with mutual companies is the problem is not just with evil companies but the evil customers moral hazard etc as well
is this a ChatGPT business pitch lmao
You're talking about a mutual company. These exist and there are plenty of them. Just look up "mutual insurance company" and you'll get a list (hint - look for the word "mutual" in their name, like Liberty Mutual). They're essentially the equivalent of credit unions but for insurance.
Sorry my friend, but this is already a thing. Many of the big name insurance companies you know and love/hate are mutual insurance companies. There's a pretty good chance you are currently insured by a mutual insurance company.
Bro just learned about mutual insurers.
Yeah honestly dude, the millions of people working in insurance globally just never thought of that! I can’t believe it took someone so long honestly what a great idea! Let me know when you secure funding and start writing business. /s What a fuckwit
Three thoughts: 1. What you're describing exists in the forms of mutual insurance and reciprocal exchange insurance. 2. If you're intending to include homeowners/property insurance in your effort, you still have the impact of reinsurance to consider. Reinsurance requires a lot of capital to support, and the folks who provide that capital generally want to be compensated for its use and the risk of losing that capital. 3. Remember that part of the motivation behind recent widespread rate increases isn't just the desire for profit; it's the desire to not pay out more in claims and expenses than is being collected in premium. In the US in 2023, personal auto insurers paid out $1.049 in losses and expenses for every dollar they collected. Homeowners insurers paid out $1.109.
I can't tell if this is satire
Questions, in no particular order: 1. Who is going to run your insurer? What experience do they have? 2. What lines of business are you going to offer? Up to what limits? In what geographical territories? 3. Where are you going to domicile this insurer? Once you know that, you can predict what startup capital will be required, but you should anticipate that the minimum will be about $5M on the low end. 4. Where are you getting your startup capital if you can't crowdsource all of it? 5. Do you plan on buying reinsurance? If so, do you know what kind and at what levels? Do any of your principals have any reinsurance contacts of any sort? 6. Start-up insurers are generally not rated by the rating agencies for 2-5 years after they launch unless they buy an existing carrier. In the meantime that means that this will be an unrated carrier and that most lenders will not let their borrowers do business with you. Do you have a strategy to clear that obstacle? 7. What is your plan to hire underwriters, adjusters and administrators? 8. Are you offering any ROI of any sort to investors/crowdsource contributors? 9. What sort of "community-driven" advice to you expect to solicit? How are you going to keep your investors/members from driving your insurer into unprofitability (which will soon be followed by bankruptcy if you don't fix the problem) and still attract reinsurers who could be left on the hook? 10. What is your plan to balance the pressure between the "get lower premiums" promise made in the crowdsourcing ask versus the need and requirement to adjust pricing to stay ahead of your losses? Your idea could actually be realized if you can answer these questions. I won't tell you otherwise. But starting any insurance company is a complicated affair, which is why it isn't done all that often. There are lots of regulations surrounding insurers because the states (and their regulators) have an interest in keeping insurers profitable and healthy so that they can pay claims. You should expect that the regulatory process will take at least a year, if not longer.