Starting an insurance company

[nats0128]

Hi All,

I am looking into starting a car insurance company, but have no idea on how to legally start.

i have been sitting on a idea for a while and needed an user incentive to keep users actively engaged within the application, and the only idea i have come up with is to offer car insurance, This is a niche market and nothing like this has been done before.

The only issue i have is how do i start an insurance company?

 

[intheTRADE]

Do you mean you are looking to start a car insurance comparison service or be the actual insurer of the drivers?

 

[nats0128]

Do you mean you are looking to start a car insurance comparison service or be the actual insurer of the drivers?

I will be the actual insurer of the driver.

 

[finleydesign]

I will be the actual insurer of the driver.

have you won the lottery?? How on earth would you have enough capital to cover potential claims?

 

[intheTRADE]

Well you will firstly need to have authorisation from the FCA and get yourself regulated by the PRA and the SM&CR

I am presuming you have experience in this industry and you also have at least a couple of million pounds in capital and adequate risk controls in place for when the inevitable happens and you have to pay out?

 

[Chris Ashdown]

Your car owner driving a humble fiat 500 skids into a gas tanker that busts into flames and runs into the local shopping centre killing both drivers and 50 bystanders and huge brick and mortar buildings

Glad i was insured by you

 

[Mr D]

Your car owner driving a humble fiat 500 skids into a gas tanker that busts into flames and runs into the local shopping centre killing both drivers and 50 bystanders and huge brick and mortar buildings

Glad i was insured by you

Having a bad day that day?

Must admit an insurance company is an interesting idea. Probably millions to market it - and considerable payout to agents, price comparison sites etc.
Not to mention the staffing of admin staff, specialist staff etc.

 

[Financial-Modeller]

@nats0128 some of the rules are here:

https://www.fca.org.uk/firms/general-insurers-insurance-intermediaries

Or, with £1m liquid assets you can start or buy into a Lloyds Insurance syndicate with limited liability. You would need to buy a lot of reinsurance at that level though!

I'm going to guess that there are easier, and/or more cost effective ways to achieve your objectives!

 

[CharlieHooray]

I don't want to shatter any dreams but it's very unlikely that's happening due to the capital you require. In my industry one recent start up has £14 million of backing and they still have to place the insurance with a large multinational insurer

Why not consider setting up your own firm and speak to existing insurance companies about placing the risk with them...they give you a cut back of their earnings for placing with them, they hold the risk and it helps you start.

If you are adamant you want to start your own company you need to contact the FCA, complete the applications they provide and then find some backers with deep pockets.

 

[gpietersz]

I think what you probably need is to do is set up as an insurance broker and find an insurer who can provide suitable policies for your target market.

A possibly similar business that I came across is an insure broker who specialises in selling car insurance to people who have recently returned from living abroad.

You might also think about working with an insurance broker who will know how to set this up. You supply market knowledge and they supply the industry knowledge.

I have come across so many business that would either have done a lot better, of succeeded instead of failing, if they had someone who understood some critical part of their business. In my experience its usually software of websites that are the problem (yes I do try to advise, but its often late in the day, and I am not inside the business), but its going just as much of a problem (very likely more so) in a financial business.

 

[Alexander Denholm]

have you won the lottery?? How on earth would you have enough capital to cover potential claims?

Glad you pointed this out...

 

[Gordon - Commercial Finance]

Glad you pointed this out...

Glad you resurrected this dead thread to add this extremely useful gem.

Thanks for you contribution but the OP hasn’t returned since posting the first message so I doubt they will see it.

 

[The Byre]

I do not know what his silly game is, but he and his partner have been opening and closing businesses for the past 2-3 years, ten of them so far! Some last a just a few months. One could be inclined to think that they are up to no good - or that they are playing at being in business.

Right now he seems to be trying to boost his post-count, perhaps so that he can post links to whatever scheme he imagines is going to make his fortune.

@Alexander Denholm - this is a business forum and not a play-pen.

 

[Alexander Denholm]

I do not know what his silly game is, but he and his partner have been opening and closing businesses for the past 2-3 years, ten of them so far! Some last a just a few months. One could be inclined to think that they are up to no good - or that they are playing at being in business.

Right now he seems to be trying to boost his post-count, perhaps so that he can post links to whatever scheme he imagines is going to make his fortune.

@Alexander Denholm - this is a business forum and not a play-pen.

I don't know who you are referring to in the first part of this comment?

As for the post-count, perhaps I shouldn't try to provide my thoughts and just conform to what everyone else thinks? If this forum is only designed so historic members are allowed to voice their opinion, I would not have created an account and avoided the hassle.

 

[fisicx]

If this forum is only designed so historic members are allowed to voice their opinion, I would not have created an account and avoided the hassle.

It's a forum full of business owners and operators who share knowledge and ideas. Many of them have been doing this for a long time and know what they are talking about.