14 GenAI: Brightening the insurance industry’s future Agents, get ready to embrace the innovation tech brings
21 It’s just a hop, a skip and a jump with the right system
Embedded commercial-lines quoting saves more than time
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The insurance industry can be rather reactive: A risk develops, insurance carriers develop a product to cover that risk, insurance agents offer that new coverage to their clients who have exposures to that risk. And, this process works.
For example, it’s believed that the first cyber security liability insurance policy was sold in 1997. Now, it’s estimated that the cyber insurance market could surpass $22.4 billion by 2026—at an annual growth rate of more than 25% in the next five years.
However, while being reactive can be lucrative, proactive innovation also is vital to business success.
Ways to innovate ...
No. 1: Allocate resources for innovation initiatives. This includes people, assets and attention. If you have an idea you’d like to implement in your insurance agency, you need to make sure you back up that idea with resources—or it won’t go anywhere. You must invest in innovation.
No. 2: Develop your processes. Innovation isn’t one-size-fitsall. You need to examine your goal and determine the best pathway to that goal.
No. 3: Design a value proposition that includes your new approach. This should include information about client engagement, and distribution and marketing.
No. 4: Make sure the innovation process is continuous and integrated. Failure happens when you don’t integrate your innovation into the business-planning cycle. Make sure to maintain a dialogue between everyone involved. This will help you: understand the market landscape; identify potential opportunities; and realize aspirations.
Terms:
Innovation: the process of introducing new ideas, products, services or processes to a company to create value and drive growth.
Value proposition: (in marketing) an innovation, service or feature intended to make a company or product attractive to customers.
Insurance trends in disruptive innovation
Disruptive innovation = a process in which a new product or service starts at the bottom of a market, and eventually displaces established competitors.
Here are some ways disruption innovation has affected the property/casualty industry:
• The idea that insurance can be broken down has enabled new players to compete with more established carriers.
• Carriers are developing new products to tackle new risks to increase profitability.
Tips for agents to consider:
• Be open to flexible partnerships, which may help you to be competitive.
• Offer specialized products that meet clients’ needs, but also look for ways the products can be sold online and through mobile devices.
Latest insurance innovations
AI
• Improved customer experience
• Streamlined claim process
• Improved risk assessment
• Revolutionized underwriting
• Transitioned from detact and repair to predict and prevent
UBI
• Offered precise risk assessment and pricing models
• Analyzed real-time driving data to understand risk profiles and adjust premiums
• Detected fraud, helped with accident reconstruction, and recovered stolen items
• Streamlined the claims process
Drones
• Can capture accurate images and detect details human eyes can’t see
• Can be dispatched to accident sites by the insurance carriers to collect images of the scene, which can help mitigate fraud
• Can improve safety—drones can access sites that would be unsafe for humans
• Can increase efficiency—the time to review the site and relay the information to the carrier is decreased
Low/No-cost platforms*
• Offers agility and flexibility
• Reduces staffing pressures
• Lowers legacy software costs
• Enhances operational efficiency
*Platforms that individuals can use to create applications without traditional programming.
Disruptive innovation in the insurance industry
As risks evolve, so too does insurance. Changes allow for disruptive innovation—when a new product or service starts at the bottom of the market and eventually displaces established competitors.
Probably the most innovative disruptor affecting all industries right now is artificial intelligence. In the insurance industry, AI can improve efficiency, reduce costs, offer a better customer experience, help detect fraud and offer better risk management.
Let’s look at some of AI’s disruptive innovations and their various pros and cons in the insurance industry.
Machine learning
The pros. As computers continue to learn from data—not explicit programming—they will be able to help insurance agents and others in the industry with underwriting, claims processing, fraud detection and risk management. Better risk prediction and easier fraud detection may help reduce insurance premiums. Additionally, machine learning can help adjust insurance premiums based on a client’s individual risk factors. All of this could lead to a better customer experience.
The cons. Accurate machine learning models rely on the quality of data that is analyzed. The adage: Garbage in, garbage out still holds true. It’s vital that insurance agents review the data being analyzed before they act on the results.
AI can be biased because the data used to train the computers isn’t representative of everyone affected by it. Setting prices and underwriting guidelines based on machine learning models could raise regulatory red flags based on fairness and discrimination. Plus, due to the complexity and constant evolution of machine learning models, they could lack transparency to understand how they reach their decisions.
Artificial intelligence technology
The pros. Artificial intelligence technology can be used to decrease the number of insurance claims each year. As cars become better equipped with safety features that help prevent accidents, and houses become smarter (with sensors detecting structural and health risks) the chance to mitigate—if not eliminate—certain insurance claims, becomes a greater possibility.
Additional pros include the following: AI technology can make it possible to pay claims without filing a claim. For example, if an insured purchases a policy to protect against
something being canceled—and a cancellation occurs—the insured could be compensated automatically. The cons. While AI can be used to make faster decisions (e.g., instant quotes, automating part of the claims process or streamlining various processes), it could alienate clients who prefer face-to-face communication. Agents need to make sure they balance the benefits of AI while they maintain the strong human connections clients expect from them.
Additional cons include the following: AI adoption can be expensive, and there can be data privacy and security issues. Plus, your employees may be concerned about whether their jobs will be replaced with AI. However, since the human connection in the insurance industry is highly sought after by clients, this is unlikely. When you make AI additions to your agency, make sure your employees know you aren’t looking to replace them, and rather stress how the automations will help them offer better service to their clients.
Intelligent automation
The pros. The use of technologies that use AI and robotic process automation to improve operational efficiency and streamline business processes can benefit the industry by improving efficiency and reducing costs. They also can expand capacity without expanding an agency’s staff. It also helps implement new products and services innovations.
The cons. The more you automate in your agency, the more you need to plan and to train employees to maintain a smooth transition. As with most automated systems, you need to audit the data being used to account for accuracy, transparency, and to eliminate biases.
Takeaways
Innovation has been a cornerstone of the insurance industry since its beginning. And with every step, the independent agency system has adapted.
Once upon a time, emails and text messages raised questions about how they should be utilized in everyday insurance operations. However, insurance agents established processes and protocols to help ensure that the necessary data was input into a client’s file correctly. Today, can you imagine how to do your job without these functions?
The use of AI is a next step in the insurance industry’s evolution, and by embracing the benefits and by being proactive in mitigating the technology’s drawbacks, agents and their agencies can continue to innovate and create the best customer experience for their clients.
Insurance Agency + CoverForce
Government & industry affairs specialist, PIA Northeast
How ID management tech empowers modern agents
In today’s hardened insurance market, independent agents face mounting pressures from both clients and carriers. This challenging environment has disrupted traditional workflows, as carriers transfer more business to other providers, exit certain states, go insolvent or implement stricter underwriting standards. These shifts force agents to adapt quickly, placing significant strain on their operations and staff members.
When a carrier leaves a market, agents must act swiftly to replace coverage, often shopping for new policies across multiple carriers. This involves revisiting client profiles, obtaining updated quotes and ensuring seamless transitions—all while managing clients’ heightened expectations, which often are exacerbated by frustrations over rising premiums. The increased workload heightens the risk of errors and omissions during these transitions.
Compounding the issue, the hard market has driven up premiums and reduced policy options, which necessitates more frequent price shopping for existing clients. Traditional workflows, which are reliant on manual processes and siloed carrier systems, struggle to keep pace. Agents face inefficiencies when navigating complex quoting and binding procedures across various platforms, which slows operations and reduces overall effectiveness.
Balance trust and federated identity technology
Agents have built their success on trust, personal relationships and exceptional service. These qualities remain integral to the core of the profession, but the tools used to deliver them have evolved. Federated identity management systems link a user’s identity across multiple separate ID systems. In the agency and brokerage world, these systems allow agents to manage their work with greater precision and speed, simplifying tasks that once required considerable manual effort. The shift toward these centralized platforms, which integrate multiple functions into a single ecosystem, has transformed the way agents operate. Yet, the technology that enhances workflows may introduce risks, as the consolidation of access points creates potential vulnerabilities that could jeopardize clients’ personally identifiable information.
TECH
Simplify workflows for better client focus
Streamlined workflows are among the most notable benefits of today’s agency management systems. By integrating client management, policy processing and claims tracking into one platform, agents can eliminate inefficiencies associated with navigating multiple applications. The ability to manage an entire book of business from a single dashboard can allow agents to dedicate more attention on clients and to enhance the overall customer experience. However, the convenience of centralized systems makes them attractive targets for cybercriminals, who can exploit a single compromised credential to infiltrate multiple connected systems.
Understand the risks
The insurance industry is a prime target for cybercriminals due to the sensitive information it handles. Small agencies are particularly vulnerable—as they often lack the resources for comprehensive cyber security protections. Cyberattacks such as phishing, ransomware and data breaches are more frequent and sophisticated, threatening not just financial losses, but also reputational damage. For agents, the stakes are high; a breach of client trust can have legal consequences for their business relationships and future opportunities. Centralized systems—while beneficial for operational efficiency—magnify the potential impact of a security breach. A single point of access can become a single point of failure, exposing the agency’s entire digital infrastructure, if it is compromised. This reality underscores the critical importance of implementing robust cyber security measures to protect both client data and business operations.
Secure your digital tools
To mitigate these challenges, agents must adopt a proactive approach to cybersecurity. This includes understanding, and complying with, state-specific regulations designed to protect sensitive information. In states like Connecticut, New Hampshire and New York, agency owners are familiar with the stringent requirements of CT Public Act 21-119, NH Public Act 21-119, and 23 NYCRR Part 500. These laws and regulations emphasize the critical need to establish and to
maintain robust cyber security programs to protect sensitive information systems and private data.
In contrast, New Jersey and Vermont have not enacted financial cybersecurity laws or regulations yet. This leaves agencies in those states without formalized requirements, which leaves their clients susceptible to vulnerability. Strong authentication methods, such as multifactor authentication, are a cornerstone of effective cybersecurity. By requiring an additional verification step beyond a password, MFA reduces the risk of unauthorized access. Encryption further enhances security by ensuring that sensitive data remains protected, even if intercepted. To address known vulnerabilities and to adapt defenses to evolving threats, regular software updates and system patches are critical. These technical measures, when combined, create a robust defense against potential cyberattacks.
Education and awareness are just as essential as technical safeguards. Agents and their teams must be trained to recognize phishing attempts, to use strong passwords, and to follow safe online practices. Ongoing training and a culture of vigilance can enhance an agency’s ability to prevent cyberattacks and mitigate their impact. Clients value security and privacy, and demonstrating a commitment to these principles strengthens the trust that is central to the agent-client relationship.
Chart a path forward
The future of independent insurance agents lies in their ability to embrace technology while addressing the responsibilities it brings. Federated identity agency management systems offer unparalleled opportunities to streamline workflows and improve client interactions, but they must be implemented with careful consider-
ation of cyber security risks. Agents who prioritize both innovation and protection can navigate the digital age with confidence, ensuring that the benefits of technology enhance rather than compromise their operations.
As the insurance industry continues to evolve, agents will remain vital by adapting to these changes and reinforcing their core strengths of trust, expertise and personalized service. By investing in secure, efficient digital tools and fostering a culture of cyber security awareness, agents can position themselves at the forefront of the industry, to meet the demands of a rapidly changing market while maintaining the values that have always defined their profession.
Alexander is PIA Northeast’s government & industry affairs specialist.
CURTIS M. PEARSALL, CPCU, CPIA President, Pearsall Associates Inc.
Personal lines: More E&O exposures than you think
Most agents’ errors-and-omissions carriers report that commercial lines generate the majority of E&O claims. However, a significant number of E&O claims arise from the sale and service of personal lines.
For agents selling personal lines, understanding the risks and knowing how to minimize the potential of an E&O claim are vital. Simply turn on the news to see the devastation caused by Mother Nature, and then consider how many personal-lines customers are or are not covered for the losses they are facing. On average, when an E&O claim involving personal lines occurs, the severity—the size of the claim—is much less than the commercial-lines counterpart. Yet, depending on the agency’s clientele, E&O claims involving personal lines can reach the $1 million-plus level easily. In personal lines, there are three lines of business that typically generate the bulk of the activity: homeowners, auto and umbrella.
Homeowners
With a homeowners policy E&O claim, one of the more significant issues involves valuation. While many agencies use a replacement-cost estimator, these are not perfect. In many cases, the quality of the output is directly attributable to the quality of the input.
Be cautious in securing the various inputs and verify the accuracy of the data. For example, some websites may not include an indicator that an addition has been put on the house. It is best to ask the customer additional questions to determine if changes occurred. When quoting a new business account, don’t presume that the limit shown on the current policy is accurate or up to date.
Other issues involving homeowners E&O exposures include:
• various limitations contained within the policy. Make the customer aware of these limitations in writing;
• the carrier’s underwriting guidelines. Carriers have been known to sue agents when the agency bound the carrier on a risk prohibited by the underwriting guidelines; and
• vacancy and ordinance or law coverages. Agents would be wise to educate customers on these two key coverage matters.
Personal auto
A central issue with personal auto insurance policies is limits. Customers do not expect to get into a crash—and many do not fully comprehend what can happen when their 3,000-pound vehicle hits something or someone. This is an area in which a $1 million loss can occur and, when the customer realizes he or she does not have sufficient coverage, there is greater potential for E&O litigation. In all situations, provide the customer with limit options from which to choose.
Surprisingly, there have been E&O claims in which the customer moved to a new location, but never notified the agency. When the vehicle was stolen, the carrier denied the claim, citing it was unaware of the vehicle’s new garaging location. In addition, a child taking a car to college raises significant insurance issues. Once again, agents would be wise to educate customers on these matters.
Uninsured/Underinsured Motorist coverage also continues to be an issue. When quoting a personal auto insurance policy, quote UM/UIM limits equal to the bodily injury and property damage limits.
... depending on the agency’s clientele, E&O claims involving personal lines can reach the $1 million-plus level easily.
Personal umbrella
How many of your personal-lines customers have an umbrella policy? An E&O claim can develop when a customer is involved in a significant claim— involving his or her homeowners, personal auto, watercraft or other liability exposure—and faces a significant uninsured exposure because the custom-
er alleges your error in not providing this coverage. Find a way to offer an umbrella policy to all customers who have the necessary underlying limits. Most agency management systems can identify customers who don’t carry an umbrella policy.
There also are instances in which the customer has an umbrella policy but,
for some reason, the underlying limits are not at the proper level. Every year, when the umbrella policy renews, you must verify that policies covered by the umbrella have the necessary underlying limits. When they don’t, and a gap occurs, agents frequently face E&O litigation.
Document discussions
Agents can benefit greatly by educating their customers on coverages the customers have, and the coverages and limits they should have to avoid uninsured gaps. Each file should reflect discussions with clients and, when necessary and appropriate, the agency should send the client a written communication memorializing any discussions. Without this documentation, courts have taken the position: if it’s not in the file, it didn’t happen.
Pearsall is president of Pearsall Associates Inc., and special consultant to the Utica National E&O Program.
Agents, GET ready to embrace the innovation tech brings
The insurance industry has long been a story of transformation, one defined by resilience, adaptation and innovation. For those of us who have grown up within its framework, it’s a narrative we know well.
Coming from a family with over a century of history in the independent agency business, I had the unique perspective of seeing the industry evolve through countless ups and downs such as hard markets, soft markets, commission cuts from carriers, carriers transferring more work to agents and profitsharing reductions. When I entered the business, I continued to hear bold forecasts about the revolutionary changes that turned out to be only incremental improvements.
Conversations regarding the challenges, and predictions about the future of the independent agency distribution channel were commonplace. There were dire warnings about direct writers taking over the market—causing the independent channel to collapse. When I heard a vendor claim to have a solution that would revolutionize the independent insurance business, I would chuckle.
Initially, stepping into the family business felt like fulfilling an obligation to carry forward the family legacy. It wasn’t something I chose with passion, but rather something I inherited with purpose. Yet, something unexpected happened: I fell in love with the industry.
What captured me wasn’t just the mechanics of the business, learning all the policy and coverage details, but it was the personal side of the business. While building meaningful relationships with clients—and pursuing professional development with organizations like Connecticut Young Insurance Professionals and the Professional Insurance Agents of Connecticut—I discovered that this industry isn’t just about policies and claims—it’s about people. The relationships I’ve built starting my first year in the agency business have stood the test of time, reflecting the collaborative spirit and enduring resilience of the independent agency channel.
Why share this story now? Because the predictions haven’t stopped. The insurance industry continues to face wave after wave of game-changing innovations, each one touted as the revolutionary change that will reshape everything. Yet, even as new products and solutions emerge, the core strength of independent agencies remains its people.
Now there is an innovation vying for the title of industry disruptor claiming to be revolutionary. Generative AI, has been hailed as the transformative force that could redefine operations, solve inefficiencies and streamline processes everywhere—including in the insurance industry. Will generative AI become the next revolutionary game changer it promises to be, or is AI just more of the same rhetoric?
In the following discussion, we’ll explore the impact of generative AI on the insurance industry. We’ll evaluate its potential benefits and risks, particularly for independent insurance agents.
Large language models
Companies such as OpenAI, Amazon and Google have spent hundreds of millions of dollars to build their proprietary large language models. Technology companies license these models that become core foundations to build industry-spe-
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cific custom models. These pre-built large language models are expensive—however, they are a cost-effective alternative to building and training AI models from scratch.
These models excel at processing vast amounts of structured and unstructured data, making them ideal for addressing the intricate data management of insurance agencies. However, they don’t inherently understand the nuanced complexities of the insurance industry.
The good news is that I know of at least one generative AIbased agency management system available today that incorporates insurance-specific algorithms, extensive insurance logic, complex rules and training. AI management solutions have been developed to tackle long-standing operational challenges, which often burden insurance agents in their daily processes.
Advantages for agencies
There are several ways that large language models can help you run your insurance agency:
AI’s data capabilities. AI can learn and it can be trained to understand any type of industry, including insurance—but it is not an easy task. There is a massive amount of data that needs to be absorbed, and AI is the perfect conduit to be trained.
Natural language processing. AI easily interprets human instructions and adapts to various formats required for the insurance industry. Properly trained and configured AI-based management systems can:
• prefill ACORD forms with detailed policy and customer data (all 800 forms and not just a small subset);
• provide voice activation (like using a smartphone) to allow agents to prefill ACORD forms and data entry via voice;
• streamline daily activities such as new and renewal business by automating redundant tasks; and
• provide analytical tools to learn more insight about your agency that typical reports do not provide today.
Enhanced analytics help with lead generation. Many lead generation vendors now tout AI to target new prospects by lines of business or geographically to help agents identify new key opportunities.
No agency training required. AI tools are built-in to the insurance products, and they typically require no AI training on the agent’s behalf.
Flexible input. AI reads and interprets structured data in many formats, as well as reading unstructured data that
might reside in emails, notes, letters and PDFs. Moving unstructured data into your AMS from these types of data sources becomes an automated process—agents will no longer have to do this manually.
Compete with direct writers. AI chatbots offer round-theclock assistance to help independent agencies provide the same accessibility as direct writers.
Emerging tools in the marketplace. New AI tools are popping up to help agents streamline operations, improve customer service and enhance decision-making. Here are some innovations:
• Client interaction tools. AI-powered customer relationship management systems analyze client data to provide insights into customer needs, enabling personalized communication and proactive policy adjustments.
• Risk assessment enhancements. Advanced AI algorithms evaluate data from IoT devices, historical claims and market trends to assess risks more accurately. This enables agents to offer tailored policies and identify emerging risks, such as cyberthreats.
• Claims processing improvements. AI systems expedite claims by automating document reviews and fraud detection. Machine learning algorithms flag potential issues, reducing errors and ensuring faster resolution.
• Predictive analytics for decision-making. AI-driven analytics forecast industry trends and client risks, aiding agents in recommending appropriate coverage adjustments.
• Policy customization. With proper training, AI tools help agents design personalized insurance solutions based on clients’ unique risk profiles, ensuring better coverage.
Challenges for agencies
While the advantages of large language models are thought-provoking, there are some challenges that insurance agents need to be aware of, including:
High costs. Large language models need to be licensed, and vendors pay for usage and training via tokens. Generally, the cost is too high for a typical insurance agency to create and develop its own model given the licensing and usage costs, and the fact that product development is an extremely difficult process.
Agencies or vendors that attempt to build their own custom large language models will require highly talented AI specialists who have a deep understanding of the insurance industry’s complexities. In addition, these AI specialists need
to understand logic, rules, algorithms, training (adding context) and testing required for product development.
Insurance knowledge gaps. Current models require additional context to handle industry-specific tasks. That means all the overwhelming insurance knowledge needs to be captured, analyzed and then used to train AI.
Overcoming drawbacks
To overcome the drawbacks of generative AI, it’s important to understand what they are. The most common drawbacks involve accuracy and bias concerns, job displacement fears, and regulatory and ethical challenges.
Hallucinating AI. AI-generated errors or fabricated answers are a serious concern that should not be taken lightly. Welltrained AI models, reliable vendor implementations and algorithms are critical to ensure against this. Vendors need to spend a tremendous amount of time to train AI to learn
CASE STUDY:
Generative AI data conversion engine development
A longstanding challenge for insurance agencies upgrading to a new agency management system has been data migration from their current AMS. This process often is plagued by high costs, extended timelines, and data loss, not to mention the extensive amount of time required by the agency to review and find errors. These inherent problems with traditional data conversions deter many agencies from switching to a new AMS.
Recognizing this issue, Quikfuzion began developing an AI Data Conversion Engine in December 2022. Leveraging OpenAI’s ChatGPT and Amazon’s Anthropic Claude LLMs, and with the collaboration of insurance agencies providing real-world database access, Quikfuzion tackled this problem with cutting-edge AI.
Quikfuzion developed the insurance industry’s first Generative AI Data Conversion Engine, which:
• allows agencies to move their data residing in their current AMS to a
the insurance business. Detailed business logic and rules, context and algorithms must be developed and customized. Extensive testing of many iterations, and even color-coding responses can help prevent AI from guessing and providing a wrong answer.
Vetting vendors. Agents must evaluate AI vendors carefully and request references to ensure the accuracy and reliability of their solutions.
Balancing automation and human touch. While AI can handle mundane tasks, it cannot replace the nuanced, personal interactions essential to insurance, therefore; job security remains intact. Automation allows staff members to focus on higher-value tasks, to enhance the customer experience.
Evolving compliance requirements. Increased AI adoption likely will bring stricter legislation and regulations, including the National Association of Insurance Commissioners
new AMS with no manual or tedious interaction.
• allows the process to be completed in hours—not weeks or months.
• reduces costs because the agency only needs one agency data set to complete the AI conversion process. Traditional conversions require a second data set because they take so long to complete.
• allows information to be more complete compared to traditional conversions. The AI Data Conversion engine gathers all ACORD data fields, customer information, notes and attachments.
Key challenges and solutions
Standardizing AMS configurations. Legacy AMS databases often contain inaccurate data accumulated over years. AI was utilized to clean and normalize data for carriers, brokers, employees and lines of business, ensuring a solid foundation for the migration process.
Comprehensive policy data extraction. Quikfuzion developed a method to extract complete policy data, including all ACORD fields, historical and current, not just a
limited subset, overcoming limitations of traditional methods.
Customer data and attachments. AI enabled the extraction of customer information, contact details, notes and attachments, ensuring all relevant data was captured.
The results of this data conversion were as follows:
Efficiency. The AI-driven conversion process takes approximately 10 hours—a significant improvement over the weeks or months required for manual methods, which means the quick turnaround time for an agency to have its data up and running on a new AMS is truly mind blowing.
Data completeness. Quikfuzion’s AI model captures far more data than traditional methods, delivering higher accuracy and fewer gaps in information.
Cost savings. Unlike traditional methods requiring two sets of data—one for manual extraction and another for final updates—the AI process operates with a single dataset, which reduces conversion costs.
prohibition of the realistic use in approving or denying claims or underwriting a risk based solely on AI. Transparency in decision-making will be essential as AI tools become more sophisticated.
What AI can’t fix
AI can’t bypass the fees and restrictions imposed by the AMS legacy vendors. These vendors will hold the agency’s data to stop the agency from leaving—even though courts have upheld the data belongs to the agency. This behavior has existed for years, and it is getting worse as vendors battle to keep customers. Addressing these types of data issues requires industrywide change, and it needs to be championed by those in the insurance industry.
A revolution or an evolution?
So, is generative AI a revolution or an evolution? Perhaps, it is a bit of both. AI is in its early stages, and it is starting to evolve. Generative AI is helping to reshape the insurance industry for both carriers and agencies by offering tools to
enhance productivity, streamline operations and address long-standing challenges like data conversions.
I’ve experienced firsthand the amazing performance of AI and its ability to leapfrog traditional legacy workflows and processes. As AI technology becomes more sophisticated, it will continue to offer agents exciting opportunities. However, AI is not a panacea. Agents must approach AI thoughtfully, with a balance of optimism and caution, using AI to enhance the human element that defines the value of the independent agency distribution channel.
Quikfuzion is an InsurTech company that has developed a robust, AI web-based agency management platform designed to replace older and more expensive agency management systems. Prior to Quikfuzion, Cooksley was CEO of Xcipio, which created the industry’s first real-time comparative rater that was sold to Fiserv. He spent 20 years in the insurance agency side, specializing on mid- to large-sized commercial accounts. He also served as past president of CTYIP and past vice president of PIACT.
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It’s a hop, a skip and a jump with the right system
Embedded commercial-lines quoting saves more than time
It’s no secret that the insurance industry has long been run on tedious, paper-driven and time-consuming processes. Agency staff members have had to spend most of their time on costly, low-value tasks instead of focusing on what matters most—serving as trusted advisers to their customers. Luckily, our industry is experiencing a digital transformation that will change everything.
Innovation has begun to transform nearly every agency function, from accounting to marketing to customer service, introducing automation to enhance workflows and reduce staff’s time and errors. But ask any agent, and he or she will tell you that quoting commercial lines is one of the more tedious activities to take on each day. Manual data entry, ever-fluctuating carrier appetite, and shorter quoting windows make quoting small-commercial business difficult. Agencies needed a better way to deliver quotes that is not as costly, repetitive and time-consuming. Integrating single-entry, multi-insurer comparative rating into your agency management system ensures a single data source for the quoting and application process. It allows you to remarket or quote new business seamlessly, to present a professional proposal, and to simplify the bridge-to-portal bind experience without ever leaving your management system.
Having the ability to quote commercial business directly within your AMS helps your team members stop bouncing
between systems, and close renewal or new business faster. According to the 2022 Tarmika Customer Survey, nearly 60% of agencies reported spending more than three hours every day manually entering policy data for quotes and submissions. However, those that adopted a commercial quoting platform reported saving 80 minutes per commercial-lines risk quoted.
There are so many more reasons to use an embedded commercial-lines quoting tool beyond saving time. Whether it’s to provide better guidance to your clients, to ease the remarketing load or to train new employees, your agency is sure to reap the benefits. Let’s explore some of the advantages professional insurance agents see as they implement these tools.
Provide better guidance to clients
As an agent, you want to give your clients the most competitive rates and comprehensive service. This can be hard when you must go to individual carrier portals for each quote. Not only does it delay getting information back to your client, but it also opens the opportunity to miss the best coverage option if you aren’t aware that a particular carrier has appetite for that risk. Add to that the unpredictability of a volatile market—which means that a risk profile in a carrier’s appetite one day could be out of favor the next. This often
leaves agents with inconsistent information on what carriers actually want to write, resulting in wasted time submitting applications to markets that no longer have the appetite.
Using an embedded quoting tool gives you quick access to a snapshot of commercial coverage options so you can provide clients with guidance. You can show clients and prospects accurate, real-time quote comparisons for more insurers and more lines of business. Depending on the tool you are using, you can access more than 30 markets and most major commercial lines within your management system. This gives you access to a more robust panel of carriers, and ensures your clients get the best products at the best premium price. You also can provide clients with a marketing summary that shows them that the agents reviewed more than just one or two quotes, and that your team is working with their best interest in mind.
Not only do you need to show that you’ve done your due diligence and provided the best possible options to your clients, you need to do it quickly. With the fast-paced, competitive nature of today’s market, clients will not hesitate to pursue alternative options if you cannot propose a quote quickly—which will lead to missed opportunities and loss of potential business. Proactive and timely customer service—in part, enabled by efficient quoting—builds and retains more business.
Multiple locations, one quote
Let’s face it, commercial lines can be complicated. Your clients are not confined to one physical location, and that can make quoting tricky. Carrier platforms are not always set up to allow for multiple location quoting, which means re-entering information over and over again. This is time consuming and can lead to errors and omissions.
Embedded quoting solutions eliminate the need to re-enter data and submit multiple quotes for a single risk within multiple locations. Even if you have policy applications with
multiple locations stored in your agency management system, that information will prefill in your quoting solution. Not only does this reduce the amount of data entry your agents need to do, but it also ensures that all locations are included in the quote.
Ease the remarketing load
Remarketing is a time-consuming, yet necessary process. Re-entering base question data into multiple carrier portals can take a lot of time, and exposes risks for small typos that can create big problems.
Embedding the quoting tool directly into your management system allows for prefilling pre-existing client and prospect data into the application, creating a single point of data entry and validation. This reduces the risk of data entry errors that could lead to costly errors-and-omissions issues. You also can see where the prefill information is being pulled from if you ever want to verify the information.
It also means you can remarket more accounts faster. Because hard market conditions are becoming the new norm, many agents find themselves needing to remarket more accounts each year than they did in the past. Being able to complete the process fully in your agency management system lightens this load. The embedded commercial-lines quoting tool’s ability to streamline the remarketing process is particularly valuable in the current market in which quick and informed decisions are essential. Agents can provide service to their clients by doing the due diligence needed to get the best coverage and prices available—without the time crunch of having to go into individual carrier portals to get quotes.
Train new employees
This might be the least expected benefit—you can use your embedded commercial-lines quoting tool as a resource to help train employees who are new to the insurance industry. Insurance has a talent problem due to a significant
amount of seasoned professionals nearing retirement age, so agencies are working to bring in new, younger employees to fuel the industry with fresh perspectives. But commercial lines can have a learning curve that takes years (some say between three and five years) for a newcomer to learn—including which carriers write which risks. By the time a newcomer is up to speed, the carrier’s appetite may have changed.
The previously mentioned coverage snapshot will give new employees more insight into the market, more quickly. One agency we worked with reported seeing its learning curve drop significantly after adopting an embedded commercial-lines tool.
Maintain a complete prospect and client view
When you must submit each quote individually to carrier portals, it can be hard to keep track of which carriers you’ve quoted throughout your relationship with the client, and why a quote wasn’t chosen.
Embedded quoting tools provide easy visibility into historical and active quotes to maintain a complete prospect and client view. Easy access to details (e.g., market rates and quote status) helps you stay on top of where active quotes stand. Being able to view historical details (e.g., client quote history) is especially beneficial when renewal time rolls around. You no longer need to start remarketing from scratch—making the process move along much faster.
It may sound counterintuitive, but having this historical data available will set you up for future success. Artificial intelligence technology is coming that will be able to provide market recommendations based on what has worked with similar risks. Using an embedded quoting tool now will ensure your data ducks are in a row when this technology is available, allowing you to take full advantage of it right out of the gate.
Benefits for today and the future
Time savings is a major benefit of implementing an embedded commercial-lines solution, however there’s so much more to gain. Implementing one of these tools gives you the ability to enhance your customer service, and to help your employees do their jobs more efficiently. Making this forward-looking investment will help your agency in the present and prepare you for the future. Embracing a digital commercial-lines experience will have your clients and staff thanking you when they see the increased efficiency, greater profits and better partnerships—the return on investment of leveraging tech for commercial lines.
Gupta is chief product officer at Applied Systems Inc. He is responsible for the company’s product vision and product management teams. Formerly CPO at 4C Insights, a sophisticated Data & Analytics SaaS provider to the AdTech/MarTech industries, which was acquired by Mediaocean, the mission-critical platform for omnichannel advertising with more than $200 billion in annualized media spend managed through its software, connecting the ecosystem of agencies, brands, media, technology and data. As CPO of the combined companies, he spearheaded their product transformation to the cloud, adding new products fueled by data and intelligence infused in the core workflow. Previously, he’s led product organizations for several tech companies, including at Vubiquity, Mixpo and Microsoft among others.
Start spring the right way
Get ready for an unforgettable insurance experience at Connecticut Convention 2025.
Gain new insights with the two days’ worth of education sessions: dive headfirst into the risks associated with autonomous vehicles, drones and more; explore how generative artificial intelligence can intersect with the insurance industry; and avoid errors & omissions pitfalls as you learn about your ethical and legal responsibilities as an agent operating in Connecticut.
You also will be able to explore business solutions at the packed trade show, and forge new relationships with your industry peers at the networking reception.
Education Highlights
Thursday, March 20
9–11 a.m.
3:30–4:30 p.m.
The Intersection of AI and Insurance
Friday, March 21
9:30 a.m.–12:30 p.m. Errors & Omissions:
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JOHN CHAPIN President, Complete Selling
Stay motivated when selling
There are four forms of motivation: external negative, external positive, intrinsic and peer. The best—and potentially most powerful—is intrinsic motivation, or internal motivation. This type of motivation answers questions like: Why do you do what you do? Why do you get out of bed in the morning? Why do you go to work? Or even, why do you work out and eat right?
The answers to these questions might be to provide for your family, to buy a dream house or car, to go on a dream vacation, to stay healthy, to be able to impress someone, or fully enjoy all the previous items mentioned for as long as possible. Tying this motivation to sales, the question then becomes: What do you want out of life for which your sales career will provide the money?
You can use external positive motivation to get you moving. External positive is a reward you give yourself for hitting a goal. An example is buying something you really want like a nice watch or a car—the prize should be determined by the size of the goal. If you want to get the family involved, have a family trip to Hawaii as the payoff for achieving a big goal, or going out to eat at a nice restaurant for a smaller goal.
Another form of external positive motivation is to realize that every call—regardless of whether you make a sale—puts money in your pocket. How so? Figure out how much money you make on a sale and how many calls it takes you to get to the sale, and then break that number down to calculate how much money you make per call. For example, if it takes 10 prospects to get a sale and 10 calls to get a prospect, that means it takes 100 calls to make a sale. If every sale is worth $1,000, then every call—regardless of the outcome—equals $10.
External negative is a penalty for not doing something. Usually, this one is based on activity goals (e.g., a set number of prospecting calls for the week or month). The reason to focus on activity versus a result is because you can control activity—you can’t necessarily control the results. An example of external negative motivation is: if you don’t hit the number of prospecting calls for the month, you must give $1,000 to a political candidate you don’t support. It also can be going without something you enjoy like dessert for a week or two.
SALES
Peer motivation can come in the form of competing with others in the office. You could challenge others to see who can get the most leads in an hour. Another form of this type of motivation is to ask others to hold you accountable for certain sales goals you’re hoping to hit.
What else can you do?
Other than the four forms of motivation, what else can you do to keep yourself inspired? One action is to get completely sold on what you are selling. If you are completely sold on your product and you know it’s going to help a lot of people and make their lives significantly better, you’ll be more motivated to sell. As one of my sales managers used to say, “If you had a cure for cancer, you’d tell everyone.”
Also, be prepared. The better prepared you are for any sales situation, the more likely you are to want to make sales calls, which will affect your motivation. Without preparation, people tend to avoid calls.
Don’t forget to take care of yourself. If you’re putting the wrong food in your body, or you are sleep deprived, this will have a negative effect on your motivation—and the effect could be substantial. Get plenty of sleep, eat right and exercise.
Despite having a plan to stay motivated, you need to realize that you won’t always be able to stay focused on that plan. This is when you need to rely on self-discipline. If you can get in the habit of making calls, and doing the things you don’t want to do, you’ll engrain those habits into your daily routine, and it will be easier as you go along.
Bonus: In a pinch—on those days when you are feeling less motivated—caffeine can give you a boost. Just try to limit your daily intake to 300 milligrams or less.
Chapin is a motivational sales speaker, coach and trainer. To have him speak at your next event, go to www.completeselling.com. He has over 37 years of sales experience as a No. 1 sales rep and he is the author of the 2010 sales book of the year: Sales Encyclopedia (Axiom Book Awards). Reach him at johnchapin@completeselling.com.
Have a question? Ask PIA at resourcecenter@pia.org
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Wrongful evictions, waivers of subrogation and more
Conn.: Parental liability
Q. Our clients have a youthful operator (under the age of 21) residing in their household. The youthful operator has his own personal automobile policy. Are the parents subject to a liability exposure for him? If the youthful operator has minimum limits of liability, does this create a liability exposure for the parents?
A. Yes. Parents do have an exposure. There are several legal theories that could be advanced to assign liability to a parent. However, just being a parent is not one of them. These theories include the following:
• A parent may repair the brakes on the child’s auto, and the parent may be held liable for the brakes’ failure.
• A parent could be held negligent in operating the child’s auto, or in distracting the person operating the auto while an occupant of the auto.
• According to the family car doctrine, as owner of an auto that is used by family members for their pleasure or convenience, a parent can be held jointly or severally liable for accidents.
• A parent could be held liable for an underage child’s operation of an auto while intoxicated—if the alcohol was furnished by the parent.
• A parent could be held liable if the child is acting on behalf of the parent under a principal/agent or employer/ employee relationship.
• In some states (not Connecticut), a parent also could be held liable for negligent supervision or negligent entrustment.
The current ISO Personal Auto Policy protects the parent for two of these exposures, but not the others. The excess coverage of the parent’s PAP is limited to a parents’ “maintenance” of the child’s auto and a parent’s “occupancy” of the child’s auto.
Other legal theories for holding a parent liable would not be covered by the parents’ policy. The parents will be restricted
to the coverage and limits provided by the child’s PAP, unless an umbrella policy provides this protection without gap between the retained limit and the child’s PAP limit.
For more information, PIA Northeast members can access Parental liability for a child’s use of an auto (QS06015) in the PIA QuickSource library.—Dan Corbin, CPCU, CIC, LUTC
N.H.: Discontinued operations liability coverage–gone out of business
Q. When contractors go out of business, we always recommend they buy discontinued operations liability coverage for products and completed operations exposures going forward. If incorporated contractors dissolve their corporations, are they free from liability? For example, if a deck they built collapses and hurts someone, can they be sued? If the corporation is dissolved, can the individual officers of the old corporation still be sued? Should we still quote coverage for this potential liability?
A. The only way the officers can be held individually responsible would be if the corporate veil were to be pierced; that is, to circumvent the limited liability of the owners and to hold them liable for some underlying corporate obligation. For more information on the corporate veil, including the factors that should be considered, see the following links: tinyurl.com/yz2nw8h7, tinyurl.com/ypfkue24, and tinyurl. com/yc2td7ve.
Since these cases are driven by specific facts, you would not be in a position to give general predictions about the financial exposure they will assume by canceling the insurance. That guidance should be left to their personal attorney.—Dan Corbin, CPCU, CIC, LUTC
Vt.: Terminated agent’s rights
Q. In Vermont, what are my rights as a terminated agent?
A. The insurer must notify the producer of termination within 15 days of communicating such termination to the commissioner (8 V.S.A. 4813m).
Within 30 days of receiving such notice, the producer may file written comments concerning the substance of the notification with the commissioner. The producer shall, by the same means, simultaneously send a copy of the comments to the reporting insurer.
Other than notification requirements, there are no protections for agents regarding rights or commissions after termination. The Vermont Department of Financial Regulation considers it a contractual issue between the agent and the carrier.—Bradford J. Lachut, Esq.
Personal and advertising injury liability–wrongful eviction
Q. We’d like an interpretation of Coverage B–Personal and Advertising Injury Liability of the ISO Commercial General Liability Coverage form. We had a situation in which our client was sponsoring an event on a town green. During the event, our client asked security to remove a woman because of her disruptive behavior. We want to know if our client’s policy should respond to the woman’s claim of wrongful eviction. The carrier is balking to pay the claim because the town green is a public space.
A. Under the terms of the policy, “‘personal and advertising injury’ means injury, including consequential ‘bodily injury,’ arising out of one or more of the following offenses: c. The wrongful eviction from, wrongful entry into or invasion of the right of private occupancy of a room, dwelling, or premises that a person occupies, committed by or on behalf of its owner, landlord, or lessor.”
There is no requirement that the premises be privately owned in order for wrongful eviction to apply, which means that coverage should apply un-
der these circumstances.—Dan Corbin, CPCU, CIC, LUTC
Waiver of subrogation vs. waiver of transfer of rights
Q. If our insured is contractually required to name the other party as an additional insured on his or her policy, wouldn’t the request to also attach the Waiver of Transfer of Rights of Recovery Against Others to Us (CG 24 04) endorsement be redundant? Is a “waiver of subrogation” the same as a “waiver of transfer of rights”? We have seen both terms used. Do they both mean that the insurer will not subrogate?
A. The answer to your first question is yes. An additional insured already has subrogation waived, although subrogation also can be waived by a hold-harmless agreement or by endorsement.
Under the antisubrogation rule, an insurer has no right of subrogation against its own insured for a claim arising from the very risk for which indemnification was sought under the policy. For example, once a general contractor has been named as an insured for claims arising out of the ongoing operations of the subcontractor, it precludes the subcontractor’s insurer from subrogating against that general contractor.
The fly in the ointment could be if the general contractor is not an insured for completed operations. Then, the insurer would not be barred from subrogating on coverage not provided to the additional insured.
In my view, if the general contractor is covered as additional insured for the subcontractor’s operations (and completed operations, if required in the contract), then no other modification of the policy is necessary.
On the other hand, if that general contractor is not named as an insured, the CG 24 04 endorsement would be an appropriate option. This endorsement could avoid subrogation for losses paid in excess of contractually required limits or for losses not required to be covered in the contract (current additional insured endorsements do not pay more than contractually required limits or for insurance not required in the contract).
Some practitioners contend that the CG 24 04 endorsement will waive the subcontractor insurer’s right of contribution. It states, “we waive any right of recovery we may have against the person or organization shown in the Schedule …” And, it also states, “This waiver applies only to the person or organization shown in the Schedule above.”
Recovery is based upon the insured’s rights assumed by the insurer, not the insurer’s legal right of contribution. Supported by the Other Insurance provision in the policy, the insurer may seek contribution from other insurers covering the same loss on a primary basis according to their equal share, or their share by limits. Contribution is independent from the waiver of the insured’s rights of recovery against a named party.
Regarding a “waiver of subrogation” being the same as a “waiver of transfer of rights,” both terms are used to identify policy provisions that surrender the insurer’s subrogation rights. The “transfer of rights of recovery against others to us” language was part of ISO’s attempt to replace technical terms with more reader-friendly terms. —Dan Corbin, CPCU, CIC, LUTC
Technology driven. People focused.
Today, Independent Insurance Agents need access to meaningful data, analytics, and information. That’s a major reason joining SIAA is the smart choice. We are a technology driven organization that realizes the outputs of systems and processes should empower agents to achieve more and support their success.
Wherever you are on your journey as an independent insurance agent, or on your journey to become one, we provide access to the tools, knowledge, and support you need to further your success. It’s why we exist – and why we take pride in what we do. SIAA realizes it’s about what you can and will achieve.
Learn how joining our community can make the difference in your long-term success as an independent insurance agent.
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PIANH 2024 – 2025 Board of Directors
OFFICERS
President Casey Hadlock
Hadlock Agency Inc. 150 Old County Road Littleton, NH 03561-3628 (603) 444-5500
casey@bestinsurance.net
Vice President
Jeffrey Foy, AAI Foy Insurance-Manchester 1889 Elm St. Manchester, NH 03104-2500 (603) 641-8111 jeff.foy@foyinsurance.com
Secretary/Treasurer
Alex Kapiloff, CPCU, CLU, CIC, AAI Kapiloff Insurance Agency Inc. 417 Winchester St. Keene, NH 03431-3914 (603) 352-2224 akapiloff@kapiloff.com
