The Challenges of Starting an Insurance Company from Scratch

[2] minute read

We are aware that people may agree / disagree with what is written below. These are our own experiences and feel free to comment, like, dislike.

One product to protect you, everyone and everything you love, no matter what happens. Sounds obvious, no? At least, it does to us at Waffle where we aim to protect you every time you need it.

And yet, when we set out to create Waffle, we were completely unaware of the challenges that getting to market would entail. Because starting an insurance company from scratch is really hard.

Three main challenges we would like to talk about here: regulation, positioning, and partners.


Above all, the role of regulators is protect consumers when bad sh*t happens. Not surprisingly, insurance has to be and is one of the most regulated sectors in the United States. And that’s a good thing. Because insurance affects people’s lives and livelihood.

Now, at Waffle we like rules (our CEO is a lawyer) but navigating the insurance regulatory landscape has been challenging. Adding to the complexity is the fact that, for historical reasons, insurance in the US is regulated on a state by state basis. So, not only do we have to be licensed in every state we operate in (rather than having a federal license), but our product is actually regulated differently in California than it is in New York or Florida. This means much higher costs, which limits growth at a time where we really need it.


No one should (or does) wake up in the morning and think about insurance. If you do, it means that something has gone wrong (we can talk about it, if you’d like). Truth is that insurance is one of consumers’ least favourite industries in pretty much every country in the world.

How does the industry deal with this ? The narratives have changed over time. Look at the evolution of insurance advertising. We moved from the ad for patriotic insurance, to the ad on safety and security to the not-so-funny we-know-you-don’t-like-it-but-we-make-it-painless. Hardly what dreams are made of. And despite the fact that insurance companies are some of the highest spenders on advertisements in the US (not picking on anyone but GEICO is estimated to have spent over $1.5bn on advertisements alone in 2017), the perception does not change.

So, what are we doing differently? Well, we like to think that we’ve flipped the industry on its head but protecting you and everything you love and removing exclusions through one product that you design yourself. We know that the concept resonates but the challenge is education how to make people think about Waffle differently from insurance. This is the reason that the first two people we hired are both focused on positioning and branding.

You will start to see our approach in the next few months and we hope you engage with it.


We work with some wonderful partners that have taken a huge risk to work with us and we will always be grateful. As a start-up you can normally drop everything to focus on what is important at that exact moment.

Our partners would be the first to admit, though, that they are not the easiest to work with. Stringent internal approval processes, mountains of other work (“What do you mean, Waffle isn’t the most important thing for you?”) and large corporate life just gets in the way.

Despite the founding team having worked in large companies, this has required a resetting of expectations which takes time. And time hinders momentum. So, what can we do? Soldier on. Be creative. And don’t despair.

Anyone that wants to speak in more detail about the above, feel free to reach out to us at: contact@waffle-labs.com

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