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You must have very deep pockets. A joke in the industry was to stay away from health insurers in a certain state. You could start a health insurance company in this state with only $100,000 of capitalization. I don't think that is still the regulation in that state. Requirements for reserves in insurance companies is more than it is to start a bank normally. Insurance companies never go out of business. They are almost always purchased by a much larger company to support confidence in the industry. Companies are audited every year by the states they operate in to make sure they have sufficient reserves, and that they pay out claims as they should and that they don't pay out claims they shouldn't pay. In order to start a company you will also have to have experienced people involved in the company from the beginning. You need people with experience in all parts of industry management. You cannot start a company without being assured of success. It is rare that a new company is just started. Normally companies are purchased that already have staff, experience, customer base, and capital. Existing companies may start a new company as part of their business but it is very rare for a complete new organization to pop up.

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7y ago
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