[gruez]

>A transparent 20% fee to run everything

how does that compare with the profit margins of a traditional insurance company?

[incongruity]

Very different market but the the ACA has a Medical Loss Ratio rule that requires insurers to spend 80% of premium dollars on care and thus caps admin costs + profits at 20%. (http://kff.org/health-reform/fact-sheet/explaining-health-ca...)

I find that an interesting coincidence in this case...

[gilsadis]

Health insurance is a whole new ballgame. But let's stick to P&C, and especially homeowners and renters, whereas companies are conflicted in paying out claims, as it impacts their bottom line. When they pay you your claim, they make less profits. So they're in this conflicted situation in which they have to decide between profiting, and paying your loss. A flat 20% removes that conflict and aligns interests.

[maya_lemonade]

Hey Gruez, Regular insurance companies have an expense ratio of 40%.

[SmellTheGlove]

In P&C it's closer to 28%, and for most of them that means agency commissions and such. That said, I think 20% expense is a bit wishful for a startup, but I hope I'm wrong and that it works out for you.

I will just assume that your 20% doesn't include LAE unless you're writing super preferred risk.