You can, but there are very few P&C insurers currently doing it, and I've not seen an insurance startup willing to operate the way they do it. In the short run, you're only writing NY insurance, and 20% is completely possible. Scale is going to hurt initially, but if you do it right, it is possible to bring expenses back down. Legal and compliance, as well as handling claims, is going to be expensive on the way to 50 states.
My unsolicited advice, which may be worth exactly the zero that it's costing you, is to establish lean management and process control up front, and take a very hard look at the expenses you add in growth mode and evaluate whether you still need all of that once you've established 50 state operations and presumably can leverage internal economies of scale. That's one hell of a run on sentence.
And fix your website TOS to make it unambiguous that it does not apply to the insurance product or contract. You never know when some regulator is going to take issue.
