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Top Business Risks
It’s probably not a surprise that geopolitical volatility has surged into a list of the top 10 business risks worldwide. But cyber risk remains the number one concern globally, followed by business interruption at number two.
That’s according to Aon’s 2025 Global Risk Management Survey, which has tracked the most pressing risks for business decision-makers for nearly 20 years.
Geopolitical volatility rose 12 places since the last Aon survey in 2023, breaking into the top 10 global risks (at number nine) for the first time in the survey’s history—and is forecast to rise to fifth by 2028, said the survey report, which was based on interviews with nearly 3,000 risk managers, C-suite leaders, and executives in 63 countries.
Aon noted that the depth of business concerns about geopolitical volatility depend on the region and differing exposures to geopolitical flashpoints. However, businesses in all regions predicted that this risk would rise in their future list of business concerns.
“Cyber Attack or Data Breach” remains the number one current and future risk, according to survey respondents, as the rapid adoption of digital platforms and AI technologies has expanded the attack surface for threat actors, the Aon report said.
Respondents identified the top 10 global risks in 2025 as:
1. Cyber attack or data breach
2. Business interruption
3. Economic slowdown or slow recovery
4. Regulatory or legislative changes
5. Increasing competition
6 Commodity price risk or scarcity of materials
7 Supply chain or distribution failure
8. Damage to reputation or brand
9 Geopolitical volatility
10. Cash flow or liquidity risk
Aon’s 2025 survey also provided a forward-looking perspective on the risks business leaders expect to be most critical by 2028. Respondents identified the predicted top 10 future risks in 2028 as:
1. Cyber attack or data breach
2. Economic slowdown or slow recovery
3. Increasing competition
4. Commodity price risk or scarcity of materials
5. Geopolitical volatility
6. Regulatory or legislative changes
7. Business interruption
8 Artificial intelligence
9. Climate change
10. Cash flow or liquidity risk
Aon’s 10th Global Risk Management Survey, a biennial web-based research report, was conducted between April and June 2025 in 11 languages. The research gathered responses from 2,941 decision-makers.
Andrea Wells V.P. of Content
Chairman of the Board Mark Wells | mwells@wellsmedia.com
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News & Markets
Swiss Re Takes a Look at Hidden Behavioral Forces Behind Skyrocketing Jury Awards
By L.S. Howard
The exponential growth of liability claims costs and social inflation in the United States is being driven, in part, by changing juror sentiment and shifts in societal norms, according to analysis from Swiss Re.
“This growing gap between economic fundamentals and actual claims experience has been termed ‘social inflation,’ which is in large part driven by legal system abuse,” the article explained.
In its 2025 Behavioral Social Inflation Study, Swiss Re aimed to assess the behavioral reasons behind legal system abuse, which was based on a nationally representative survey of 1,150 U.S. adults who were presented with a series of randomized legal simulations.
“Crucially, the effect is not confined to Fortune 500 companies. In cases involving severe injury, jurors are nearly as likely to recommend high compensation against small and medium-sized enterprises (SMEs) as they are against large corporations,” the article added.
“We’re seeing growing strain on the civil justice system, with more lawsuits yielding damages that often outpace the actual harm. Jury awards in the tens of millions are becoming more frequent, shaped by emotion, not just evidence,” said Monica Ningen, CEO P&C Reinsurance US, Swiss Re, in a statement accompanying the report.
“Liability claims costs in the United States have entered a self-reinforcing spiral. Traditional economic drivers such as wage inflation, medical-cost trends, and CPI growth no longer explain the pace at which liability claims are escalating,” said an article published by Swiss Re, titled “Verdicts on trial: The behavioral science behind America’s skyrocketing legal payouts.” continued on page 14
“The findings confirm that juror sentiment has shifted decisively toward plaintiffs, and this shift is influencing verdicts in measurable ways,” said the article, which laid out the findings of the study.
“These rising liability costs don’t stay in
Figures 464 Miles
2
Eight months after the Palisades Fire destroyed almost 600 Malibu houses, the city has issued only two rebuilding permits. Delays are attributed to low insurance payouts, slow permit approvals and high costs. Prices for burnt-out lots are dropping as some former residents give up on returning.
The orbital height of a new mapping satellite called NISAR, short for NASA-ISRO Synthetic Aperture Radar. The joint U.S.-India mission, worth $1.3 billion, will survey virtually all the world’s land and ice masses multiple times. By tracking even the slightest shifts in land and ice, the satellite will give forecasters and first responders a leg up in dealing with floods, landslides, volcanic eruptions and other disasters. ISRO is the Indian Space Research Organization.
$1.5 Billion
A federal judge in California preliminarily approved a landmark $1.5 billion settlement of a copyright class action brought by a group of authors against artificial intelligence company Anthropic, according to the authors’ representatives. The proposed deal marks the first settlement in a string of lawsuits against tech companies, including OpenAI, Microsoft and Meta Platforms, over their use of copyrighted material to train generative AI systems.
$877,000
The U.S. Occupational Safety and Health Administration fined a Florida commercial painting contractor $877,000—one of the largest OSHA fines in recent years—six months after a worker fell from a bridge near Savannah, Georgia. Seminole Equipment Co., based in Tarpon Springs, Florida, failed to provide fall protection and life jackets to workers painting the Interstate 95 bridge over the Ogeechee River, OSHA said. Painters were removing scaffolding when Jose Hernandez Garcia fell and drowned in the river.
Declarations
Cannabis Risks
“We’ve had entire crops where, maybe the insured harvests 600 plants, [and] the next day, there’s a box truck that rams through their roll-up door and steals all of the product. They come in, and they’ll take whatever they can get their hands on.”
— When asked about the most significant exposures in the cannabis industry, Beth Ossino, claims manager at Golden Bear Insurance Company, pointed to theft and robbery. During Insurance Journal’s annual Insuring Cannabis Summit, Ossino recalled a couple of instances of devastating losses for insureds, including thieves carrying a safe out of a business and robbers making off with huge amounts of product.
Flat-out Fraud
“It’s just flat-out theft of taxpayer money… At the end of the day, he stole money from the citizens and masked it as legitimate fees.”
— Chris Yates, Texas Department of Insurance (TDI) fraud unit investigator, discussing the case of former insurance agent Carlyle Poindexter, who overcharged almost $300,000 in insurance premiums. Poindexter pleaded guilty to conspiracy to commit wire fraud in August and was sentenced to five years in federal prison and a $50,000 fine. Over six years, Poindexter charged Maverick County Solid Waste Authority $712,350 in premiums but gave Lexon Insurance Company just $329,313. He kept almost $300,000 plus a portion of commissions.
Sinkhole Protection
“I want you all to imagine being a newlywed starting a life with somebody, putting your life savings into a house because you have been told that this is the way that you build generational wealth; this is how you take care of your family moving forward. And then, because of a major rainstorm, your house, and everything in it is gone in an instant.”
— Pennsylvania Rep. Emily Kinkead, D-Bellevue, endorsing House Bill 589, which established an insurance fund for landslides, slope movement, and sinkholes through the state’s Department of Community and Economic Development.
Helene Recovery Continues
“I hope I never see another one in my lifetime, and I’m hoping that if I do, it does hold up. I mean, that’s all we can (do). Mother Nature does whatever she wants to do, and you just have to roll with it.”
— Vickie Revis, whose North Carolina home was swept away by the Swannanoa River in the wake of Hurricane Helene. After a year in a donated camper, she and her husband, Paul, will soon move into a double-wide modular home, also donated by a local Christian charity. It sits atop a 6-foot mound that Paul Revis piled up near the front of the property, farther from the river. At the time of the storm, their home was uninsured. They have since purchased insurance.
Electric Tractors
“If we were to mechanize all the smallholder farmers in the world, there isn’t enough diesel out there to power them. So, we have to find some other source.”
— Ajit Srivastava, an agricultural engineer and Michigan State professor, who is working to improve the viability of large-scale electric tractor adoption. Srivastava wants to help smallholder farmers, who grow about a third of the world’s food. Agriculture is among the largest sources of climate-warming emissions worldwide. Though tractors are a small culprit, experts believe an environmentally friendly machine would still attract buyers interested in sustainability.
Trial by Fire
“What we’ve learned in California and Oregon is it’s the non-economic damages that can really, really get you.”
— Andy DeVries at CreditSights, commenting prior to the announcement that Utility Xcel Energy Inc. has agreed to pay about $640 million to resolve claims that its power lines contributed to the 2021 ignition of the costliest wildfire in Colorado history. The company reached settlements with individual property owners, public entities and insurers ahead of a trial with billions of dollars stake. The company could have faced damages of more than $7 billion, including awards to victims for emotional distress. The company isn’t admitting fault or wrongdoing in connection with the settlements.
News & Markets
continued from page 8
the courtroom. They contribute to higher insurance premiums, reduced coverage availability, and increased costs for everyday goods and services,” she emphasized.
“The growing role of third-party litigation funding adds another layer of pressure, often prolonging cases and inflating awards. Given the magnitude of these costs, businesses must pass these pressures along the value chain, and ultimately, consumers bear the impact,” Ningen said.
The Case for Tort Reform
As a result of these trends, the report said, the case for tort reform is clear.
“Our research shows how public attitudes shaped by a desire to hold companies accountable and a receptiveness to high compensation demands create fertile ground for the plaintiff’s bar, often backed by third-party litigation funders,” the article said.
“Targeted tort reforms have historically helped restore balance to the system,” Swiss Re said, pointing to states like Florida, Georgia, and Louisiana, “where legislatures have introduced reforms to cap damages, limit attorney fees, and create transparency in litigation funding.”
For insurers and reinsurers, the study reinforces the scale and persistence of uncertainty in the U.S. liability market, but the data offer little hope for near-term relief, the article affirmed.
“These rising liability costs don’t stay in the courtroom. They contribute to higher insurance premiums, reduced coverage availability, and increased costs for everyday goods and services,”
“Legal system abuse shows no signs of abating, and pricing uncertainty remains extraordinarily high. Maintaining underwriting discipline through prudent limit structures, appropriate attachment points, and rate increases that reflect the underlying loss cost trend—is essential to sustaining profitability.”
Diving into the hidden behavioral forces behind legal system abuse, the report pointed to three key findings:
• Attitudinal trends: Litigation becomes a social norm. “At the heart of legal system abuse lies a fundamental shift in public
sentiment. Litigation is no longer viewed by the average American as a last resort or an excessive burden on society.” According to Swiss Re’s 2025 behavioral study, just 56% of respondents believe there are too many lawsuits in the U.S., which is a sharp decline from 90% in 2016. “This signals a major shift in perception, with lawsuits increasingly seen as a legitimate tool for exacting justice.”
• Behavioral scenario findings: It’s not the company, it’s the injury. To understand how attitudes toward litigation translate into actual monetary outcomes, survey participants were asked to weigh in on a series of real-world scenarios, which covered slip-and-fall incidents, motor vehicle accidents, and product liability cases. Swiss Re found that a clear pattern emerged: Injury severity, not company size, is the strongest driver of verdict behavior. “Large corporates drew slightly more blame and larger awards, but in most cases the differences were modest and not statistically significant.”
• Who’s on the jury matters more than you think. The survey results reveal a strong political, generational, and economic skew. For example, self-identified Democratic respondents selected award amounts that were 25% to 65% higher than those proposed by Republicans, with Independents tending to fall between the two groups in terms of award size.
Age and income levels were also factors affecting jury awards. “Younger respondents—especially those under 40—expressed significantly more plaintiff-friendly views than older generations,” the study said. At the same time, respondents with lower incomes “favored broader corporate accountability and were more likely to support legal action.” Swiss Re’s analysis determined that this group could “view the legal system as a form of redistributive justice, further reinforcing the trend toward higher awards.”
The article on the social inflation study was authored by Martin Boerlin, head of Casualty Pricing North America and chief underwriting officer P&C Reinsurance, and Surbhi Gupta, senior portfolio analyst and CUO for P&C Reinsurance.
News & Markets
Responsible AI Deployment Linked to Better Business Outcomes: EY
As broader adoption of AI technologies continues to accelerate, companies that implement more advanced Responsible AI (RAI) measures are pulling ahead while others stall.
According to the second Responsible AI Pulse survey from the EY organization, four in five respondents said their company has improved innovation (81%) and efficiency and productivity gains (79%), while about half report boosts in revenue growth (54%), cost savings (48%), and employee satisfaction (56%).
The global survey of large corporations also reveals that nearly all organizations report financial losses and widespread impact from compliance failures, sustainability setbacks, and biased outputs.
According to EY, Responsible AI adoption involves defining and communicating principles before advancing to implementation and governance. The transition from principles to practice happens through 10 RAI measures that embed commitments into operations.
The survey suggests greater adherence to RAI principles is correlated with positive business performance. For instance, those respondents with real-time monitoring are 34% more likely to see improvements in revenue growth and 65% more likely to see improved cost savings.
On average, organizations surveyed have already implemented seven RAI measures, and among those yet to act, the vast majority plan to do so. Across all measures, fewer than 2% of respondents reported having no plans for implementation.
“The widespread and increasing costs of unmanaged AI underscore a critical need for organizations to embed practices deep within their operations to not only reduce risks but also accelerate value creation,” commented Raj Sharma, EY Global Managing Partner, Growth & Innovation.
“This is not simply a compliance exercise; it is a driver of trust, innovation, and market differentiation. Enterprises that view these principles as a core business function are better positioned to achieve faster productivity gains, unlock stronger
revenue growth, and sustain competitive advantage in an AI-driven economy.”
EY’s survey insights were gathered in August and September 2025 from 975 C-suite leaders across 11 roles and 21 countries. All respondents had some level of responsibility for AI within their organization. Respondents represented organizations with over $1 billion in annual revenue across all major sectors and 21 countries in the Americas, Asia-Pacific, Europe, the Middle East, India, and Africa.
Other findings include:
• Inadequate controls for AI risks lead to negative impacts: Almost all (99%) organizations surveyed reported financial losses from AI-related risks, with 64% suffering losses of more than $1 million. On average, the financial loss to companies that have experienced risks is conservatively estimated at $4.4 million. The most common AI risks are non-compliance with AI regulations (57%), negative impacts to sustainability goals (55%), and biased outputs (53%).
• C-suite knowledge gaps in identifying appropriate controls: On average, when asked to identify the appropriate controls against five AI-related risks, only 12% of C-suite respondents answered correctly. Chief risk officers, who are ultimately responsible for AI risks, performed slightly below average (11%). As agentic AI becomes more prevalent in the workplace and employees experiment with citizen development, the risks—and the need for appropriate controls—are only set to grow.
• Citizen developers highlight governance and talent readiness gaps: Organizations face a growing challenge in managing “citizen developers”—employees independently developing or deploying AI agents. Two-thirds of surveyed companies allow this activity in some form, yet only 60% of them provide formal, organization-wide policies and frameworks to ensure these agents are deployed in line with responsible AI principles. Half also report they do not have a high level of visibility in employee use of AI agents. Companies that actively encourage citizen development were more likely to report a need for talent models to evolve in preparation for a hybrid human-AI workforce. These organizations cite the scarcity of future talent as their top concern.
Business Moves
National
White Mountains Insurance, Bamboo
White Mountains Insurance is selling a controlling interest in insurance distribution platform Bamboo to European private equity firm CVC in a deal that values the company at $1.75 billion.
White Mountains bought a majority stake in Bamboo in January 2024 for nearly $300 million.
Bamboo was launched in 2018 by leader John Chu. The company provides residential homeowners’ insurance and related products.
White Mountains is holding company that owns and manages businesses in the insurance and financial services industries.
The company will retain a 15% fully diluted equity stake in Bamboo post-closing, worth $250 million.
The deal is expected to close by the end of the year.
East
ALKEME Insurance, Alliance Brokerage Corp.
California-based ALKEME Insurance acquired Alliance Brokerage Corp., a Melville, New York-based property/casualty agency. The acquisition strengthens ALKEME’s presence on the East Coast, adding insurance and risk management expertise in both real estate and construction insurance.
Alliance Brokerage Corp. serves a range of clients. Alan and Jonathan Zack head the firm.
ALKEME, Gotham Brokerage Co., Gotham Brokerage
California-based ALKEME Insurance acquired Gotham Brokerage Co., a New York City insurance agency founded 60 years ago. Gotham specializes in insurance for condos, co-ops, and apartments with a concentration in the high-value real estate markets of Brooklyn and Manhattan. The acquisition enhances ALKEME’s personal insurance capabilities.
Northern Neck Insurance Co., Frederick Mutual Insurance Co.
Northern Neck Insurance Co. and Frederick Mutual Insurance Co. intend to affiliate, pending regulatory approval, in a move to grow across the Mid-Atlantic region.
The partnership will unite Northern Neck’s personal lines focus with Frederick Mutual’s commercial lines experience. The insurers will continue to operate under their existing brands. Together, the companies will have more than 90 employees and 450 independent agency locations in Virginia, Maryland, Pennsylvania, Delaware, the District of Columbia, and North Carolina.
Frederick Mutual Insurance Co. is jointly owned by Frederick Mutual Group, Inc., a stock corporation with majority ownership, and Mutual Capital Investment Fund (MCIF). Northern Neck has agreed to purchase MCIF’s preferred stock. Upon closing, the preferred stock will convert to common stock. After the transaction closes, management intends to pool results for both companies.
As part of the agreement, Northern Neck will enter into a management agreement with Frederick Mutual, with Peter Cammarata as president and CEO of both organizations and Northern Neck’s board of directors providing unified governance.
The transaction is expected to close before the end of 2025.
Novacore, Minglewood Risk
Novacore, the specialty insurance managing general agent (MGA) formerly the U.S. commercial division of NSM Insurance Group, will acquire Minglewood Risk, an MGA specializing in habitational and real estate coverages.
Founded in Langhorne, Pennsylvania, with core markets in New York, New Jersey, Pennsylvania, Colorado and California, Minglewood Risk specializes in commercial package and excess and umbrella insurance for residential real estate.
Minglewood Risk will become part of Novacore’s real estate segment, with a focus on expanding into the five boroughs of New York City. Novacore partners with more than 20,000 agents nationwide and offers more than 15 specialty programs.
Terms of the deal were not disclosed.
Midwest
The MEMIC Group, The Dakota Group Workers’ compensation specialist The MEMIC Group, led by parent company Maine Employers’ Mutual Insurance Company, entered into an agreement to acquire The Dakota Group, including Risk Administration Services, Inc. and its four affiliated insurance services companies.
The combining of the companies will make The MEMIC Group the third largest multi-state workers’ compensation specialist in the U.S., with estimated combined 2025 writings of more than $600 million and coverage for more than 25,000 employers nationwide.
Both companies are rated A (Excellent) by A.M. Best.
This acquisition includes the purchase of The Dakota Group’s subsidiary-affiliated service companies, including OHARA LLC, TLC Advantage LLC, and Precision Bill
Review LLC. These entities provide both insurance coverage and cost-containment services, such as case management, PPO networks, and medical bill review, to a broad client base across the Midwest.
The transaction also includes Risk Administration Services, Inc. (RAS), which serves as attorney-in-fact to the reciprocal insurer Dakota Truck Underwriters (DTU), as well as a controlling interest in First Dakota Indemnity Company, which is managed by RAS.
With a significant presence in the upper Midwest, The Dakota Group has a growing market share in workers’ compensation that aligns with The MEMIC Group’s growth along the Eastern seaboard.
The Dakota Group is the leading voluntary workers’ compensation writer in South Dakota and a top writer in Minnesota, Iowa, Kansas, and Nebraska.
The transaction is subject to regulatory approval and is expected to be finalized in early January 2026.
World Insurance Associates LLC, ACB Insurance Inc.
World Insurance Associates LLC acquired the business of ACB Insurance Inc. ("ACB") of Indianapolis, Indiana on June 1, 2025. Terms of the transaction were not disclosed.
ACB provides insurance to individuals, families and businesses. The agency is led by Corey Kunkleman, who joined ACB in 2003 as president.
WalkerHughes, Brady Benefits
WalkerHughes Insurance added Brady Benefits, a Fort Wayne-based Employee Benefits brokerage, to its growing Midwest platform.
Brady Benefits, led by Matt Brady, specializes in group health and ancillary benefits. Brady and his team, including Shannon Martin and Angie Lash, will join WalkerHughes,
South Central
Inzone Insurance Services, Arkansas Best Insurance Agency Inc.
Inszone Insurance Services announced its expansion into Arkansas through the
acquisition of Arkansas Best Insurance Agency, Inc., an independent agency based in Hot Springs, Arkansas.
Founded in 1905, Arkansas Best Insurance Agency has served clients across Arkansas and neighboring states for well over a century. Michael Lipton has served as primary owner for 15 years.
Arkansas Best Insurance Agency has operated as a generalist, providing insurance solutions for businesses of all sizes while also maintaining a presence in personal lines.
Amynta Group, Global Surety LLC
Amynta Group has entered into a definitive agreement to acquire Global Surety, LLC, International Sureties Limited and International Sureties SARL (collectively, “International Sureties”), a commercial surety broker based in New Orleans, Louisiana.
The transaction is subject to regulatory approvals and is expected to close during the fourth quarter of 2025. Terms of the transaction were not disclosed.
International Sureties, founded in 1972, is a specialty surety broker, providing a broad range of commercial surety products, including admiralty, court, bankruptcy, logistics and license and permit bonds.
The company provides surety bond services for a wide variety of industries operating from offices in New Orleans, the UK and Belgium.
Clark Fitz-Hugh, president and CEO of International Sureties, will continue to lead the business.
Southeast
King Risk Partners, LH Griffith & Co.
King Risk Partners, headquartered in Gainesville, Florida, acquired LH Griffith & Co., an agency with offices in Walterboro and Goose Creek, in southeast South Carolina.
The Griffith agency was founded 25 years ago. Heath Griffith is principal. The merger will guarantee continuity of service to parts of coastal South Carolina.
King now has offices in 16 cities in North and South Carolina.
Gifford Carr Insurance Group, Omni One Insurance Agency
Gifford Carr Insurance Group, headquartered in Ottowa, Ontario, made its first expansion outside of Canada by acquiring Omni One Insurance Agency, part of the Team Aubuchon group, based in Coral Gables, Florida.
The Florida agency will operate as Omni One Insurance, by Gifford Carr, and the firm's team will remain on board. The agency offers home, auto, commercial and other lines of property-casualty insurance.
Matthew Carr is listed as president of Gifford Carr and as CEO at Omni One.
West
Farmer Woods Group,
iinsure
Farmer Woods Group acquired iinsure, based in Scottsdale, Arizona.
iinsure clients will continue working directly with Jeff Martin, owner of iinsure, while also gaining access to Farmer Woods Group's resources.
iinsure is an independent, multi-line insurance agency specializing in complex commercial and personal profiles.
Farmer Woods Group is a Leavitt Group affiliate based in Phoenix, Arizona. Leavitt Group a privately held insurance brokerage with a network of more than 85 agencies and 250 locations across 28 states.
The McGowan Companies, Limit
The McGowan Companies acquired Limit, a digital wholesale insurance brokerage headquartered in Covina, California, via an asset purchase agreement.
After the transaction is closed, Limit will continue to operate under the “Limit” brand, within The McGowan Companies envelope, led by Shea McNamara, Limit’s facility director. All Limit staff will remain in place.
Limit has two divisions: Limit Wholesale and Limit AI. Limit Wholesale is an Artificial Intelligence-enabled, digital, wholesale insurance brokerage that specializes in cyber liability and technology errors and omissions.
The McGowan Companies is an insurance broker and intermediary located in Fairview Park, Ohio.
Mary Ann Stewart
National Allianz Commercial, with U.S. headquarters in New York City, named Mary Ann Stewart as regional head of liability, North America. Based in Chicago, Stewart is responsible for the strategic direction and management of Allianz Commercial’s North American liability portfolio and talent development across the U.S. and Canada. Stewart joins from Markel, where she most recently served as senior director, global casualty underwriting, within Markel’s casualty business line.
International specialty MGA Rokstone appointed Adrianna Allman and Charles Turgeon as senior underwriters in its North American inland marine division. Joining from AIG and based in Boston and San Francisco, respectively, they have expertise in inland marine trucking, extending Rokstone’s reach across North America.
Jessica Cullen was appointed head of excess casualty and operations. Cullen joined Lockton in 2024 as head of the U.S. casualty practice, London. She has 20 years of industry experience, most recently serving as managing director of the casualty practice at Gallagher. Cullen will report to Rapciewicz.
Hippo, headquartered in San Jose, California, appointed Robin Gordon as chief data officer. Gordon spent the past decade in executive roles as chief data officer and chief technology officer at global companies including Blackstone, KPMG and CoreLogic. She also served as global chief data and analytics officer at MetLife.
Howden US appointed Christine Palomba as deputy head, natural resources, Howden US, headquartered in Columbia, South Carolina. Palomba has 29 years of industry experience, most recently at Aon, as managing director, U.S. power and renewables practice leader. Palomba's appointment follows the announcement of Mike Parrish as CEO, Howden US, to lead Howden's U.S. retail broking business.
eastern region leader for major accounts excess casualty, managing underwriting operations.
East
AXA XL, in Stamford, Connecticut, hired Eric Judd as an executive underwriter on its energy underwriting team in the Americas in New York. With over three decades of experience, Judd previously served in senior underwriting roles at Zurich North America, Liberty International Underwriters and Starr Insurance.
Insurance broker Willis has appointed Steve Blumhagen as a producer in the Upstate New York market. Based in the Buffalo office, Blumhagen has over 10 years of experience in property/casualty insurance. He most recently served as practice leader for property and casualty at USI.
Brokerage Lockton appointed Peter Rapciewicz as U.S. casualty leader. Rapciewicz has over 20 years of insurance industry experience, including over a decade of leadership at Lockton.
Most recently, he served as alternative risk solutions practice leader. Rapciewicz will oversee the strategic direction and growth of Lockton’s casualty offerings across the U.S.
QBE North America, headquartered in New York City, appointed Jayne Cunningham as senior vice president and environmental underwriting leader. Based in North Carolina, Cunningham has over 30 years of insurance experience, including more than 20 years of leadership in the environmental space. Before joining QBE, Cunningham previously held roles at Beazley, XL Capital, Zurich and AIG.
MSIG USA , headquartered in Warren, New Jersey, appointed Martin J. Sullivan as chairman of the board of MSIG Holdings (U.S.A.), Inc. With more than five decades of experience, Sullivan previously served as president and chief executive officer of AIG Inc., deputy chairman of Willis Group Holdings plc, and, most recently, senior advisor at Lightyear Capital LLC.
Insurance agent Jason Bartow was elected president of the Professional Insurance Agents of New York State (PIANY), an association for independent insurance agents. Bartow is commercial lines executive vice president of Eugene A. Bartow Insurance Agency Inc. and Jebb Brokerage Inc.
Chubb, headquartered in New York City, appointed Joe Gaspero as senior vice president, national account segment leader of major accounts excess casualty. Based in Philadelphia, Gaspero has nearly 15 years of insurance industry experience, joining Chubb in 2013. He most recently served as
Bartow is co-chairperson of the PIA Northeast Regional Carrier Program; chairperson of the agency operations, carrier relations and Industry Affairs Committee and treasurer of the Agency Advocacy Coalition, as well as a member of PIANY’s executive/budget & finance and government affairs committees and the Long Island Advisory Committee.
The association also elected new officers to serve
Jessica Cullen
Peter Rapciewicz
Martin Sullivan
Christine Palomba
Joe Gaspero
Jayne Cunningham
Robin Gordon
in 2025-26: President-elect
Michael Loguercio Jr., of Ridge, N.Y., producer for BELFOR Property Restoration; First Vice President Jorge Hernandez of Merrick, N.Y., owner of North Franklin Brokerage Inc.; Vice President Eric Cohen of Fairlawn, N.J., CEO/managing director of Benefit Quest Inc./Eric Cohen Insurance; Treasurer Ed Chadwick of Buffalo, N.Y., who works for Jencap Specialty Insurance Services; Secretary Justin Fries of Roslyn, N.Y., owner of Garber, Atlas, Fries & Associates in Oceanside, N.Y. Richard Andrews is the immediate past president. Andrews is the owner/principal of Andrews Agency in Ithaca.
Midwest
Zach Posey joined World Insurance Associates as the leader of market relationships. Posey, who is based in Chicago, spent the past 15 years at Aon plc, where he most recently served as managing director of Inpoint, the firm’s management consulting and advisory arm. Before that, he spent 10 years in Aon’s National Casualty practice.
Alliant Human Capital, a division of Alliant Insurance Services, appointed Brian Muller as vice president. Muller has over 15 years of experience in corporate and consulting HR. Based in Columbus, Ohio, he joined Alliant in 2025. He began his career in the retail industry and later held consulting roles with several of the nation’s largest insurance brokerage and consulting firms.
South Central
Alliant Insurance Services, headquartered in Irvine,
California, hired Alex Gramling as senior vice president within its employee benefits group. Based in Fayetteville, Arkansas, Gramling serves a national client base. Before joining Alliant, Gramling was senior director, total rewards at Tyson Foods. He previously served as first vice president and lead consultant at Alliant.
Benefits consultant Terry Cox also joined Alliant as senior vice president within its employee benefits group. Based in Austin, Texas, Based in Austin, Texas, Cox serves a national client base. Cox has over three decades of experience in the health and benefits industry. Before joining Alliant, Cox served as a senior principal and sales consultant with Mercer.
IMA Financial Group, headquartered in Denver, Colorado, made two leadership appointments in its Houston, Texas, office. IMA named Joey Dryden as Houston market president. Dryden continues his production responsibilities while partnering with both the property and casualty and employee benefits teams.
IMA also hired its first local employee benefits leader. Will Ogilvie has over 16 years of experience consulting with private and public sector employers, school districts, municipalities, and non-profit organizations. Before joining IMA, Ogilvie served as senior vice president, life and health at Stephens Insurance LLC.
Southeast
ICW Group Insurance Companies, headquartered in San Diego, California, named
Tracey Estes as chief underwriting officer of ICW Specialty, a newly formed business unit that includes VerTerra Insurance, ICW Group’s excess and surplus lines carrier. Estes and her team will be based out of Atlanta, Georgia. Estes has over 20 years of insurance industry experience, most recently serving as head of casualty at MSIG USA. Before that, she was an executive vice president at Arch Insurance and held several leadership roles at AIG.
The CRC Group, based in Charlotte, North Carolina, named Brennan Paris chief revenue officer of CRC Specialty. Paris will also remain president of CRC Select, CRC Specialty’s binding operations, and oversee revenue growth for CRC Specialty’s brokerage, Select, and Insurisk divisions. Paris joined CRC Specialty in 2019. He previously served as the director of business development for Markel.
USG Insurance Services added Shannon Smith as associate producer/broker in its Georgia office. Smith, based in Senoia, Georgia, has seven years of experience in casualty risk placement in the excess and surplus market and is a licensed property and casualty agent in Georgia. Smith previously worked at Amwins, an insurance brokerage.
Alliant Insurance Services, headquartered in Irvine, California, hired Nick Martin as senior vice president within Alliant Specialty to lead the
company’s national alternative risk transfer platform. Martin, based in Atlanta, previously spent over a decade at Lockton Companies, most recently serving as vice president and alternative risk solutions consultant.
West
IMA Financial Group, Inc. named Greg Boothroyd chief people officer. Boothroyd has over 15 years of human resources experience across multiple industries and leadership positions. He most recently served as vice president of HR business solutions and chief of staff to the CEO at Vail Resorts. IMA is headquartered in Denver, Colorado.
bolt expanded Curtis Scott’s role as head of strategy and industry verticals. Scott will lead bolt’s enterprise vertical strategy and North America business planning. Scott has over 15 years of global experience, most recently serving as executive vice president, future mobility and digital economy at Aon. Scott also held roles at Lyft as vice president, GM core services and Lyft Business, and Uber as global head of insurance. bolt is headquartered in San Francisco, California.
Tracey Estes
Nick Martin
Greg Boothroyd
Curtis Scott
Closer Look: Coverage Gaps
Risk Reality vs. Commercial Insurance: Coverage Holes Exposed
By Susanne Sclafane
Two recent reports—one reviewing property and business interruption risks and the other, liability—highlight a growing divide between escalating risk and shrinking insurance coverage. They also suggest decision-makers need more insight into the risks they face.
A written report from FM, titled “Ready for the Storm: Closing the Extreme Weather Resilience Gap,” and a webinar report from Zywave, “A Look Behind the Headlines: Casualty Market Insights,” both offer data points showing that businesses are buying less insurance to cover growing risks, with costs being a major factor. And both suggest that while risk decision-makers are aware of escalating risks, they may be seriously underestimating the degree of risk specific to their businesses or the regions in which they operate.
Jim Blinn, principal account executive for Zywave,
presented a series of graphs displaying escalating excess liability insurance rates per million (per million dollars of program limit), ever-increasing loss severities, and declining limits purchased for casualty insurance in recent years. He called out the limits picture as a “concerning trend.”
“It raises the possibility that organizations are making ill-informed decisions relative to the limits they are purchasing,” Blinn said, before he and co-presenter Senior Account Executive Lauren Boehm highlighted the value to insurance
buyers of reviewing litigation outcomes specific to their business types with Zywave models to better inform their limits purchases.
The mutual insurer, FM, didn’t directly list buying more insurance among recommendations in its property-based report. But like Zywave, FM offered recommendations grounded in the insurer’s expertise—delivering longterm risk and resilience insights—when considering strategies to deal with rapidly evolving extreme weather risk hitting their businesses directly or indirectly impacting them through events at supplier locations.
“Minimizing your insurance coverage to cut costs is a false economy. Instead, taking informed, concrete action to boost resilience—throughout the lifecycle of an asset—can not only minimize the risk but keep insurance markets open and affordable,” according to a concluding page in the FM report summarizing recommendations.
Coverage Gaps Quantified “Insurance is, of course, a
vital tool in mitigating the potential financial impact of extreme weather events.” But respondents to an FM survey reported that “their current insurance policy covers less than half of the potential cost of extreme weather’s various effects,” the FM report says, summarizing one of the key results of a survey of 800 risk decision-makers.
Asked about insurance coverage for 11 specific weather-related risks, these risk decision-makers—half from the C-suite and half from risk management in industrial, manufacturing, and technology businesses around the world with revenue ranging from $250 million to more than $10 billion—indicated that property damage was the only weather-related risk that was more than half covered. And that risk was only 53% covered.
On top of page 21 we show the responses for five of the 11 categories of extreme weather events for which respondents said that likely event loss costs could be 8% or 9% of their annual revenue but that insurance covered 46%-53% of those costs.
Brokers were more pessimistic. FM surveyed 150 insurance brokers who estimated, on average, their clients’ insurance would cover around 40% of the losses experienced due to an extreme weather event.
In an earlier section of the report, broker survey results also suggested that risk decision-makers aren’t fully aware of their risks. Only about two-thirds (67%) of brokers surveyed believe their clients are “mostly” or “fully” aware of how exposed their operations are to extreme weather. That compares to 95% of CEOs and risk managers surveyed.
But in this section of the report, FM pointed to the cost of insurance, rather than
awareness, as the main issue fueling a coverage gap.
Forty-four percent of the buyers surveyed reported that the cost of insurance is too high to secure full coverage— representing the largest share of responses among the risk decision-makers. Similarly, the largest share of brokers surveyed—49%—said cost was the key reason full coverage hasn’t been purchased.
The report noted some opposing factors fueling the problem: a frequency of catastrophic weather events that has forced insurers to increase rates, and rising inflation overall that has put buyers under pressure to focus on short-term cost reduction.
“When insurance rates are going up, risk managers face the question: ‘Why are we spending so much on insurance?’” said Adriano Lanzilotto, VP, client and partner learning at FM.
The report also indicated that one-third of risk decision-makers ranked limited availability of insurance among their top three challenges in mitigating the risks of extreme weather events.
At the Zywave event, Blinn said he didn’t think availability problems explained the declining limits trends for the sizes of companies his firm studied.
“The limits that we’re seeing that organizations of this size are buying [are] not that huge. And so I think there is availability but not necessarily a desire to purchase it at these [levels] of pricing,” he said, referring to an example that he and Boehm repeated throughout the event: construction companies with between $25 million and $100 million in revenue.
Instead of surveying buyers, Blinn used commercial policy data from Zywave’s benchmarking data to compare trends in limits purchased for these construction companies with prices of insurance coverage.
is $1 million, Blinn specifically showed that average casualty umbrella limits per $100 revenue fell about 25% between 2018 and 2025, while the average rate per million dollars of program limit more than doubled. Does this limits reduction make sense when considered against casualty loss trends?
While social inflation and litigation are hot topics, an analysis based on loss data from Zywave’s Excess Casualty Loss Insight Data revealed some eye-opening pops in loss severity.
On page 22, we have captured some of the median, 75th percentile, and 90th percentile loss amounts Blinn displayed for casualty cases in the data base (general liability and auto liability for all types of companies, not just for construction companies, by case disposition year for the last decade).
The graphs reveal that the median casualty loss amount in excess of $1 million jumped more than 70% to over $5 million in the past decade, while the 75th and 90th percentile figures nearly doubled and tripled—to more than $13.5 million and more than $46 million, respectively.
“That hook upward is what insurance companies are dealing with as they think about their pricing,” Blinn said. “This is part of the reason that this median pricing has gone up,” he stated.
Increasing Risk Awareness
Moving from the representations of all the casualty claims to a specific example corresponding more closely
The above graph shows an average limit per $100 of revenue of $30/$100 in 2024, which Carrier Management calculates to be $7.5 million of program limit purchased by the smallest firms in the example—those with $25 million in annual revenues—and $30 million for the $100 million annual-revenue firms. continued on page 22
Noting at one point that the typical retention for the casualty insurance programs
Closer Look: Coverage Gaps
continued from page 21
to the example that Blinn referred to in the limits discussion, Boehm zeroed in on some loss and limits benchmarking data for construction companies. Imagining a construction firm looking to renew its casualty program with $10 million of umbrella limit ($1 million retention) and facing a 20% price hike, she was able to show that that limit was right in the middle of its peers in a benchmarking analysis.
Going further, she showed details of losses experienced by similar firms that would have exceeded lower selected limits.
Blinn later illustrated the variations in average loss amounts in excess of $1
million for different industries, different firm sizes, and different jurisdictions where cases are brought.
Separately, Swiss Re recently reported that injury type mattered more than company type or company size as a determinant of jury verdict amounts in liability cases.
Back in the property world, FM’s report suggests that risk decision-makers need to get a better handle on the weather risks they face, too. “While most businesses are confident they understand the nature of the risk, FM’s research shows they may not have the full picture,” wrote Dr. Louis Gritzo, staff senior vice president, chief science officer, FM, in a foreward to the report.
An analysis in the report showed a particular lack of extreme weather risk awareness by location. FM specifically asked risk decision-makers to consider the country or region in which their most critical businesses are based and to estimate how much of the economic activity in that area is exposed to wind or flood. The insurer then compared these estimates with FM’s Resilience Index, a ranking of 130 countries and territories’ resilience to risk, which includes a measure of their wind and flood exposure. The comparison revealed that 74% of risk decision-makers underestimate the exposure when compared to calculations in the FM Resilience Index. Estimates varied
significantly by country and region, but businesses with operations in North India, parts of China, and the UK substantially underestimate the wind and flood exposures of these areas. For example, while the FM Resilience Index indicates that 82% of Northern India is exposed, risk officers estimated a 14% exposure—a gap of 68%.
There were gaps of 20% or more in half of the 17 regions the FM analysis asked about. Risk decision-makers were better able to estimate exposure in North America, actually overestimating their exposure in the Midwest vs. the FM Resilience Index.
“Awareness is all about education, and it is incumbent upon insurers like FM to use all our expertise and insight to provide that to corporates and their brokers,” said Benedict McKenna, division claims manager for the UK and Asia Pacific at FM.
This is why FM invests significantly into exploring the science of changing weather patterns. But tracking the weather alone won’t provide a complete picture of a business’s risk exposure, the report stresses, noting that the impact of extreme weather on a given site is specific to its individual characteristics and that the evolution of business practices and building design is changing the nature and severity of risks.
“You may have two facilities located two miles away, and exposures may be very different,” said Stuart Keller, chief engineer of FM in the report. “That’s why site-level assessment is really critical.”
‘A Better Way’
Beyond the survey results, the FM
report focuses on a message on the benefits of investing in resilience measures— ranging from embedding risk engineering into the design and construction of new sites to conducting regular site inspection of existing sites to extreme weather.
Businesses’ focus on the cost of insurance may explain “why many powerful measures to mitigate extreme weather risk are under-adopted… Ultimately, though,
this short-term view is leaving businesses exposed,” the report says.
“A better way is possible,” the FM report stresses.
“Investing in resilience against extreme weather creates a virtuous circle, in which insurance savings can be reinvested in further risk mitigation measures. While there may be extra upfront costs, a more strategic approach to resilience can make a real difference to the cost—and availability—of insurance.”
FM noted that optimizing insurance spending by investing in resilience “requires a collaborative relationship with insurers.” But using the words of one interviewee for this report, some buyers
view their insurers as risk “police” and try to keep interaction to a minimum.
“It’s difficult for some clients to move from viewing insurance as occupying a risk oversight role to one of mutual loss prevention,” Dr. Gritzo said. “That is our challenge as an industry: to partner with clients and move from transactional oversight to working together to mitigate the risks.”
He suggested that FM’s mutual model is conducive to a more collaborative relationship, noting that FM issued nearly $1.5 billion in membership and resilience credits to our clients in 2024 to improve their resilience.
This story was originally published in Carrier Management.
Sclafane is Executive Editor of Carrier Management, a publication of Wells Media Group serving property/casualty insurance carrier executives.
Closer Look: Commercial Property/Condos
What to Consider When Building Insurance Programs for Aging Properties
In July 2021, after the collapse of the Champlain Towers
By Patrick Wraight
South in Surfside, Florida, the city of Miami ordered structural inspections of all buildings over 40 years old. Since then, two other condominium buildings have been deemed unsafe and evacuated. The residents of Crestview Towers were ordered out of their homes in July 2021, and the city allowed them to return in April 2025. According to a CBS News Miami online article, even though the city is allowing residents to return, some are still concerned about the safety of the building, and during the building’s retrofit, many of their units suffered damage that hasn’t been fully repaired.
This highlights some of the issues that come up with older buildings, and specifically with their insurance programs. I’d like to highlight a few areas, including underwriting and pricing challenges, claims problems, ordinance and law coverage requirements, and some risk management strategies for condo associations to consider.
Underwriting Aging Properties
Sometimes, as underwriters, we receive applications that paint a glowing picture of a risk. It’s the way the agent and applicant want us to see their building. It’s not wrong or false normally. It’s just optimistic.
The problem with older buildings is that applications may be too optimistic about their actual condition. Underwriters must evaluate these buildings as they exist today, not what they were like when they were built.
Consider a high-rise condominium building with a requested replacement cost of $10 million. What does an underwriter want to know about the building? The agent has already sent in the basic information, like year built, construction class, status of the sprinkler system, the type of occupancy, how much of the building has a commercial occupancy, whether or not there are short-term rental
spaces, and the like. That’s a baseline for information that an underwriter may ask for, but other items might cause an underwriter to dig deeper. Depending on what the loss runs look like, or whether or not they have been submitted, the underwriter will ask for more information, such as the last building structural report, data related to the ages of four critical building systems (HVAC, electrical, plumbing, and roof), including when they were inspected, replaced, or upgraded, and pictures. There will always be more pictures requested.
When the underwriter understands the entire picture of the risk, that’s when
decisions are made. In the best situations, the underwriter approves the risk without any coverage restrictions, at a limit of insurance reasonably close to what the insured requested, and at a premium that can be afforded. The problem comes when the underwriter sees things like deferred maintenance, a lack of loss history, or a 40-year-old building where no structural or critical system updates have been made. If the underwriter finds any of those items (along with other potential red flags), conversations will need to be had. The underwriter may offer to write the policy on the condition that certain items be inspected, repaired, or docu-
mented before coverage can be bound. She may also impose certain coverage restrictions, such as adding an Actual Cash Value for roofing material endorsement, providing coverage only for the first $1-$2 million of replacement cost, or declining to offer a quote at all.
Then there’s the issue of price. It will be high.
Losses Will Tell the Tale
Once the policy is written, there is also the potential issue of how it will respond in the event of a claim. Will there be enough coverage? Will the coverage respond in the way that the insured needs it to?
When a building is damaged, and the insured contacts their insurance company, the first thing that a company will do is determine whether or not coverage is in place for the claim. So, they will take the information, confirm that the policy exists, and if it does, then confirm that the building is listed on the policy. There are more details than that, but that’s the essence of it.
Once it’s determined that coverage exists, the work of adjusting the claim begins. Statements are recorded. Pictures are taken. Measurements are done. When all of the adjusting happens, in a perfect world, the adjuster tells the insured how much they estimate the claim to be worth, the insured receives estimates that agree with the adjuster, checks are written, work gets done, and the building is back in shape in relatively short order.
However, when you’re dealing with an older building, it’s not that simple. Consider buildings like Crestview Towers, which broke ground in
1969 and opened for occupancy in 1972. Crestview Towers was built under building codes that were in effect in 1972. The building codes in that area have been updated every two to three years since then, and when building codes are updated, older buildings do not have to comply with the changes until certain renovations happen, or the building is damaged and needs repair.
Even if the building was properly insured on the date when it was completed, over the following 50 years, it becomes more difficult to make sure that the cost to replace it matches the limit on the policy. Some policies include an inflation guard optional coverage. This optional coverage will increase the limit of insurance on covered property (the building) by a set percentage annually. It also increases the limit of insurance daily based on a fraction of the annual
percentage.
If we consider a building that had an initial replacement cost of $1,000,000 and an inflation guard percentage of 5%, we find that the building limit will be $1,050,000 after the first year. If the policy is allowed to renew annually, keeping the inflation guard in place and not adjusting the limit of insurance based on new cost estimates, after 50 years, the limit of insurance would be approximately $11,500,000. This seems like a huge change in limit, and it is, but is it enough?
We understand that this isn’t a reasonable example because insureds do not stay with insurance companies for that long, and insurance companies won’t go that long without running an updated cost estimator on the value of the building. When the insurance company increases the limit of insurance based on their updated cost estimate, the insured begins to
look for coverage elsewhere, and often tries to justify their old limits so that the premium doesn’t go up.
Additionally, the older a building gets, the more out of code it is. This means that even in the event of a partial loss, the local code enforcement officer arrives on site to inspect before issuing building permits for the repairs and finds that the building needs some upgrades. Those upgrades might be related to federal requirements of ADA, or simply updates of critical systems within the building. That’s another issue.
A Primer on Adding on Ordinance or Law Coverage
Even when a building is valued at replacement cost on a commercial property policy, it really isn’t the cost to replace the building. Replacement cost is generally defined as continued on page 26
Closer Look: Commercial Property/Condos
continued from page 25
the cost to replace an item of property with property of like, kind, quality, and utility. So, when an agent tells an insured that they have replacement cost on their building, or the insured reads their policy and sees replacement cost, they can believe that it means that if the building is damaged or destroyed, the insurance company will pay to replace it. And they will, kind of.
When insureds think about replacing a building, they may think about just replacing the building, even if certain things have had to change over the years. Think about the electrical needs for a condo in 1972 compared to today. Back then, there were appliances, lights, televisions, and stereo equipment—and that’s about it. Today, people have computers, tablets, phones, gaming systems, and more that require power.
When the insurance policy mentions replacing the building, it means replacing the building that was there. It does not include replacing the building and upgrading the electrical system or the plumbing system. It does not include making any changes that are required to comply with any kind of federal, state, or local building code or ordinance. It doesn’t care if the city says that you can’t rebuild that building here; you have to move it across the street, or 10 blocks south.
This is where we lean on ordinance or law coverage. On several commercial property policies, including the ISO Condominium Association Coverage Form, this critical coverage is not included. There are carriers that may include
it by default, but making sure that it’s there before a loss is better than assuming it’s there and finding out that it isn’t after a loss. Consider two potential loss situations.
In the first case, there is a fire that damages several units and common areas on three floors. The building is not a total loss, and the building code allows for it to be repaired. The code enforcement officer comes in to inspect and discovers that the last time the electrical system in the entire building was updated was 25 years ago, and the plumbing system in the building is 15 years old. He determines that these need to be updated before he approves the work. The insurance policy will pay for the repairs to the common areas, and the unit owners’ insurance policies will pay for repairs to their units, but without ordinance or law coverage, none of the required updates will be paid for, and those costs will come out of the association’s (and unit owners’) pockets.
‘Even when a building is valued at replacement cost on a commercial property policy, it really isn’t the cost to replace the building.’
In the second case, we have a smaller building that also suffered fire damage. In the investigation, it’s determined that 60% of the building was damaged in the fire, and the city requires that the remaining portion of the building be torn down and rebuilt. The insurance policy will cover the damage that was done by the
fire, but the loss of value of the remaining portion of the building is not covered without ordinance or law coverage.
Ordinance or law coverage provides three separate and related coverages. When the city says that the building cannot be repaired but must be torn down and replaced completely, Coverage A provides that remaining limit of insurance. It’s always the difference between the direct physical loss of the building and the limit of insurance, and it covers that lost value when they say the building needs to be torn down.
Once that undamaged part of the building is knocked down, someone has to come and pick up that rubble, or more directly, remove the debris. The policy provides coverage for the debris from the damaged portion of the building, but we rely on Coverage B to provide coverage for the debris that exists because we had to tear down the rest of the building. This requires a limit of insurance, and finding that limit is complicated, especially when you consider that older buildings might have materials in them that are considered hazardous today.
We also have to deal with the increased cost of construction—and that’s where Coverage C comes in. It provides a limit of insurance so that the building can be upgraded to meet today’s building codes and other requirements.
Here’s another limit that can be hard to come up with because the older the building, the more code upgrades might be needed. This is part of the reason why coverages B and C can share a blanket limit.
That can allow the insured to select a lower limit, but if there’s a total loss, they might find themselves underinsured, which is what we have been trying to avoid.
Managing the Risks
What do we do about it?
Whether you’re a risk manager, board member, or insurance agent, the right answer is not the easy one. It’s important to keep up with maintenance so that deferred maintenance doesn’t turn into a safety issue that needs to be addressed, with a price tag that will be higher than it could have been several years before.
Annual insurance policy reviews are a must. The board may not like it, and it may create uncomfortable conversations, but we can’t manage the risks we don’t know about. We can’t insure against the exposures we haven’t considered. That means reviewing limits of insurance to determine whether they are enough to pay for losses. Even if the odds are that there will never be a total loss, do you want to explain the coinsurance condition after the check comes in with a significant reduction?
Lastly, making sure that the policy covers everything that everyone thinks it does, and when there are exclusions or gaps in coverage, determining if there is a way to provide coverage for those items, what they’ll cost, and whether the insured wants to pay for it, is a good way to make sure that they have their eyes open if a loss happens.
Wraight, CIC, CRM, AU, is director of Insurance Journal’s Academy of Insurance. He can be reached at pwraight@ijacademy.com.
News & Markets
California Department of Insurance Taking Actions Against Tesla Over Claims Handling
The California Department of Insurance launched enforcement actions against Tesla Insurance Services Inc. and Tesla Insurance Company companies for allegedly failing to adequately handle hundreds of California automobile policy claims.
The actions are also aimed at State National Insurance Company. Tesla Insurance Services Inc. is an appointed agent for State National, an admitted insurer in California.
Unless these issues are resolved in favor of policyholders, the companies will be ordered to a hearing before an administrative law judge to determine whether they will be able to continue to transact insurance business in California, as well as face significant monetary penalties.
The actions allege that, despite being repeatedly warned by the California Department of Insurance, the Tesla Companies and State National chose per-
sisted with non-compliant claims-handling practices.
The CDI said it has received consumer complaints related to the handling of auto policy claims beginning in 2022. The department reportedly repeatedly warned the Tesla Companies and State National, and had meetings and correspondence, but the number of consumer complaints and violations continued to mount.
The companies face monetary penalties up to $5,000 for each unlawful, unfair, or deceptive act, or up to $10,000 for each such act determined to be willful.
The department’s accusations, including the following alleged violations:
• Egregious delays in responding to policyholder claims in all steps of the
• Unreasonable denials and delays in fully paying valid claims to consumers
• Failure to conduct thorough, fair, and objective investigations of claims.
• Failure to advise policyholders of their rights to have their claims denials reviewed by the department.
California Police Pulled Over A Waymo for An Illegal U-Turn, But They Couldn’t Cite
By Janie Har
Police in Northern California were understandably perplexed when they pulled over a Waymo taxi after it made an illegal U-turn, only to find no driver behind the wheel and therefore, no one to ticket.
The San Bruno Police Department wrote in a now viral weekend social media posts that officers were conducting a DUI operation on an early October morning when a self-driving Waymo made the illegal turn in front of them.
the car.
Officers contacted Waymo to report what they called a “glitch,” and in the post, they said they hope reprogramming will deter more illegal moves.
The department’s Facebook post has generated more than 500 comments, with many people outraged that police didn’t ticket the company. People also wanted to know how police got the car to pull over.
Officers stopped the vehicle, but declined to write a ticket as their “citation books don’t have a box for ‘robot’.”
“That’s right … no driver, no hands, no clue,” read the post, which was accompanied by photos of an officer peering into
But San Bruno Sgt. Scott Smithmatungol said they can only ticket a human driver or operator for a moving violation, unlike parking tickets that can be left with the vehicle.
A new state law that kicks in next year will allow police to report moving violations to the Department of Motor Vehicles, which is figuring out the specifics, including potential penalties, the Los
Angeles Times reports.
Waymo spokesperson Julia Ilina told the LA Times that the company’s autonomous driving system is closely monitored by regulators. “We are looking into this situation and are committed to improving road safety through our ongoing learnings and experience,” Ilina said.
Waymos currently operate in Phoenix, Los Angeles and San Francisco and in areas south of the city, including the suburb of San Bruno.
“It blew up a lot bigger than we thought,” Smithmatungol said of the viral post to The Associated Press on Tuesday. “We’re not a large agency like San Francisco.”
San Bruno has about 40,000 residents and a sworn police force of 50 officers, he said.
Waymo is owned by Google’s parent company, Alphabet.
Copyright 2025 Associated Press. All rights reserved.
News & Markets
Study Shows California Heat Standard Reduced Work Injuries on Hot Days
California’s worker heat standards led to fewer work-related injuries on hot days, a new study from the Workers Compensation Research Institute found.
The WCRI study, Impact of California’s Heat Standard on Workers’ Compensation Outcomes, measured how California’s heat standard impacted the frequency of injuries in heat-exposed occupations like construction, agriculture and transportation.
The state’s heat standard requires employers to provide water, shade,
rest breaks, acclimatization plans and emergency response protocols during excessive heat.
According to WCRI, heat-related illnesses are 11 to 18 times more frequent on days above 95°F compared with days between 75 and 80°F, yet they represent 20% to 25% of all injuries attributable to heat.
In 2005, after several deaths of agricultural workers due to heat, California implemented emergency outdoor heat regulations. They were expanded to include indoor workplaces in 2024.
The core components of the heat standard include:
• Access to water: Employers must provide at least one quart of cool, free, potable water per worker per hour, located close to where they work.
• Access to shade: Workers must be allowed to rest in shade at any time. If the temperature reaches 80 °F or higher, shade must be made available for all during breaks.
• High-heat procedures (greater than 95 °F): In specified industries, such as agriculture, construction, landscaping, and oil and gas, additional rules apply. Those include buddy systems or monitoring, water reminders, supervisor contact and extra breaks.
• Emergency response and heat-illness prevention plan: Employers must ensure communication with emergency services, first-aid protocols, transport ill workers to cooler locations, and maintain a written Heat Illness Prevention Plan.
• Acclimatization protocols: Workers new to high heat exposures or that are starting shifts during heat waves should be monitored especially for the first 14 days.
• Training: Workers must be trained on types of heat illnesses, symptoms, prevention, hydration, acclimatization, employer obligations and how to report heat illness. Supervisors receive training on how to monitor conditions, weather, employee symptoms and implementing standard procedures.
J&J Must Pay $966M After Jury Finds Company Liable in Talc Cancer Case
By Diana Novak Jones
ALos Angeles jury ordered Johnson & Johnson to pay $966 million to the family of a woman who died from mesothelioma, finding the company liable in the latest lawsuit alleging its baby powder products cause cancer.
The family of Mae Moore, who died in 2021, sued the company the same year, claiming Johnson & Johnson’s talc baby powder products contained asbestos fibers that caused her rare cancer.
The jury ordered the company to pay $16 million in compensatory damages and $950 million in punitive damages, according to court filings.
The verdict could be reduced on appeal as the U.S. Supreme Court has found that punitive damages should generally be no more than nine times compensatory damages.
safe, do not contain asbestos, and do not cause cancer.
Representatives for Johnson & Johnson did not respond to a request for comment. The company has said its products are
J&J stopped selling talc-based baby powder in the U.S. in 2020, switching to a cornstarch product.
(Reporting by Novak Jones; Editing by Chizu Nomiyama, Alexia Garamfalvi and Rod Nickel)
Copyright 2025 Reuters. All rights reserved.
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Lawyers Professional Liability
Market Detail: Protexure provides tailored Lawyers Professional Liability Insurance backed by nearly 50 years of experience through ISMIE Mutual Insurance Company—rated A- (Excellent) by A.M. Best. Designed specifically for solo to mid-sized law firms, policies deliver comprehensive protection, exceptional service, and claims expertise in today’s most litigious environments.
Key Policy Features: broad definition of professional services; disciplinary proceedings coverage up to $100,000; 50% deductible reduction for claims resolved entirely through mediation; regulatory coverage up to $25,000; crisis event coverage up to $50,000; no Hammer Clause; unlimited subpoena assistance; loss of earnings coverage: $1,000/day; free ERP for qualifying non-practicing attorneys; personal injury and advertising liability; and prior acts and loyalty deductible credits for eligible firms. Claims expertise that makes a difference with specialized claims professionals offer guidance at every step and legal defense from a vetted panel of experienced liability attorneys. Aggressive defense approach— frivolous claims are not settled to avoid cost. Has Pen.
Available Limits: Disciplinary proceedings coverage up to $100,000; 50% deductible reduction for claims resolved entirely through mediation; regulatory coverage up to $25,000; crisis event coverage up to $50,000; no Hammer Clause; unlimited subpoena assistance; and loss of earnings coverage: $1,000/day.
Carrier: ISMIE Mutual Insurance Company. Admitted. Rating A- (Excellent) by AM Best.
States: Arizona, California, Colorado, Connecticut, Florida, Georgia, Idaho, Illinois, Indiana, Kansas, Massachusetts, Michigan, Minnesota, Missouri, Nebraska, Nevada, New Jersey, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, Washington, and Wisconsin.
Market Detail: Trusted solutions for medical equipment businesses. ProTek, powered by NFP, provides a portfolio of enhanced general and professional liability insurance products to help companies that sell, service and manufacture medical equipment mitigate risks and manage costs. Experienced staff offers expertise and insurance coverages that help protect the medical device sales and service industry.
Available Limits: Not disclosed. Carrier: Not disclosed.
States: All 50 states and the District of Columbia.
Technology is changing the world at a faster pace than ever before with the help of artificial intelligence (AI). And the sky is the limit on what AI can and will do for the future of the independent agency system.
“The sky is the limit,” said Ryan Hanley, president of Linqura AI and the founder and president of Finding Peak. Every technology that’s come along promising greater efficiency and positive change for independent agencies has served its purpose. Early adopters of those technologies were rewarded, but eventually even late adopters, laggards, found their way to the same reward, he noted. “Everyone rapidly caught up and then there was very little lost space between the two,” Hanley said.
But with AI adoption, the agencies that are building a culture around these innovative technologies will leave the rest behind, he stated. “Those companies are going to ramp up so fast that when the laggards start to adopt this technology, they’re going to be so far behind that they will not be able to catch up.”
The power of AI is limitless, Hanley believes. “There’s no ceiling,” he said. “We don’t know what the ceiling is today. So, the more expertise, time, and capital that you can apply to it, the more benefit you will receive from it,” he said. The growth and ability to do more with increased efficiency and scale is exponential, he added.
“For example, I could have Sonnet AI answer all my phone calls and direct those phone calls to the appropriate person, and where necessary collect
information after hours or on weekends or for specific programs in order to quote business without ever talking to an actual human being—and do that with 95% accuracy and only a 3% complaint rate,” he said. “That alone, if you’re implementing the AI properly, changes the entire nature of your agency.”
Hanley said there’s a significant gap in knowledge on how best to use AI in agencies. Someone who is just beginning to use a free ChatGPT account to write a few LinkedIn posts is already behind in the AI revolution, he said. “They are using AI, yes, but they are so far behind, it’s not even funny,” he said. “And there is an entirely different group of agencies that hasn’t even touched AI’s capabilities yet,” he added.
For many agencies, the age of AI is moving so fast it is difficult to keep up and understand how and where to use the most effective tools. In recent years, insurance agencies have been overwhelmed with the amount of technology coming to market, particularly in the AI space, said Kasey Connors, executive director of the Big “I’s” Agents Council for Technology (ACT).
“Where do they start, how to adopt it, ease of use, risks, and responsible change management” are issues agents ask about, Connors said. “Agencies are really looking at AI right now and asking how to get started, and then how to work with vendors or vet them, and then how to integrate those AI tools into their businesses,” she said. “As with any technology, there’s a people change management piece and then how to stay current with that change,” she said.
Connors also agrees with Hanley that the knowledge gap and use of emerging AI tools in the independent agency world is significant. “In talking to many agents, some are all in—they are using it for direct bill reconciliation, they’re using it for policy comparisons, they’re integrating it into their marketing, they are leveraging it for data, or voice assistance,” she said.
‘There’s no ceiling.’
The ways in which agencies are using AI tools vary significantly, she added. The agencies that are seeing the most return on their investment in AI are using the tools to solve real problems, Connors said. “It’s one thing to leverage ChatGPT to help with an email versus integrating a tool that is solving for operational efficiencies. I think it is critical for agencies to understand that difference,” she said. “It’s not just adopting AI for adopting AI’s sake; it’s really about how can you think about this tool for your business.”
GPT-ing in the Agency
ChatGPT has been a game-changer for many businesses—from streamlining workflows to helping with customer service. Many small businesses today even use it to help onboard and train new employees. But one area where agents may find it useful is helping to sort vast amounts of information—even policy information—in seconds. That’s why Relation Insurance Services embarked on structuring its own RelationGPT this year. Kevin Rabinowitz, chief operating officer at Relation Insurance Services, told
Insurance Journal that RelationGPT was built on OpenAI’s ChatGPT 5 model, tapping into the significant investment that OpenAI made in that model. But while OpenAI is public-facing, RelationGPT was designed to keep information withing the ecosystem of Relation Insurance Services.
Security of client information is a top concern, Rabinowitz said. “So, the way we have this set up with OpenAI is it’s not just like a straight license of their product where they own the data that goes into it,” he said. “We’ve actually built our own; we call it an orchestration layer that sits in between our information and ChatGPT … It’s kind of a pass through, but it’s HIPAA compliant,” he said. “It’s enterprise safe, and our information never leaves the walls of Relation, so we feel really confident in the security of the system.”
Rabinowitz said employees are able to use the AI tool in a number of ways, similar to how an independent user might utilize ChatGPT but tailored for insurance needs.
“We’re able to use it and deploy it internally in an enterprise-safe manner that helps us be more efficient and better serve our clients,” he said. “So, it looks like ChatGPT, and it’s fully equipped with capabilities around document comparison, harnessing information that’s available on a variety of sites to improve our team’s knowledge about different insurance topics and coverage related topics,” he explained.
Document comparison is one of the primary ways that brokers use the technology, Rabinowitz said. “Sometimes continued on page 30
Special Report: Agency Technology
continued from page 29
that’s a comparison of two different policy forms. Sometimes it’s a comparison of contracts. Sometimes it’s a comparison of an insurance quote to a policy. It really runs the gamut,” he said.
So far RelationGPT has proven to be an amazing time saver for employees who used to have to compare every word, he said. “Imagine comparing a 40-page contract in seconds,” Rabinowitz said. Efficiency, speed, and the quality of the agency’s internal operational process has been the focus of the development of RelationGPT, he noted. It is helping to connect the steps in many internal processes that are needed to successfully serve clients, he added. “There’s just so much opportunity in the brokerage segment for us to improve the quality and efficiency of our own internal processes using technology like this,” he said. For Relation Insurance Services, the challenge was not creating the tool as much as creating the change for people. Incorporating technologies like AI and driving adoption among people who aren’t used to these kinds of tools can be a hurdle to overcome, Rabinowitz said. “That’s been a lot of the fun that we’ve had this year—sorting through those adoption and digital readiness considerations,” he said.
But there is no other option than to move forward with technology tools that can help to improve efficiency within the organization and for its clients, Rabinowitz said.
Next Generation AI
The next generation of
agency AI tools will be focused on doing more tasks without the need for a human. This new generation of tech, known as agentic AI, will be an “agent” that mimics the work of a human. Agentic AI tools will have the capability to understand and respond to customer inquiries without human intervention.
‘There’s just so much opportunity in the brokerage segment for us to improve the quality and efficiency of our own internal processes using technology like this.’
Imagine the possibilities. Imagine the risk. How will AI handle the exposures that might come from an agency error or omission in coverage? But some innovators in the AI development world say AI agents will only help to reduce the risk of error in agencies.
San Francisco-based SuperAgent AI founded this year says its artificial intelligence agents can handle insurance advisory, sales, and customer service at all hours of the day—more efficiently than traditional agents and with fewer mistakes.
“What Uber did for transportation, SuperAgent will do for insurance,” said Milan Veskovic, founder and CEO of SuperAgent AI.
“Our fully autonomous AI agents will eliminate human error, offer superior client interactions 24/7, and fundamentally alter industry expectations,” according to the company. “As the first real-time AI co-pilot built specifically
for insurance sales teams, we empower agents to perform at their best, on every call. Our platform helps agencies ramp new hires faster, boost close rates, and bring consistency to every conversation,” the company says.
Veskovic admits that there are a few barriers to overcome to get to a fully autonomous agent, including state licensing regulations for AI agents. “We are very early on in this journey,” he said. “But we want our insurance agents to be licensed in all 50 states.” Veskovic noted that the firm is currently in discussions with two major regulators about this issue.
For now, SuperAgent is working with agents as a co-pilot solution, explained Vlada Lotkina, chief operating officer at SuperAgent AI. Lotkina said the AI system’s methodology is broad and focuses on learning from real conversations about humans.
“It’s deeply rooted in behavioral and conversational dynamics, which allows it to really be the expert at insurance sales first, and then the product knowledge is the layer on top of it,” she said. That allows the system to be flexible and agile and effectively grow with the needs of the agency, she explained.
Lotkina said the co-pilot solution requires limited integration requirements, if any at all, with other agency technologies such as agency management systems. “That allows us to really learn with the organization, grow with the skills, while helping the existing agent become more productive, leveraging our technology,” she said.
At the same time, SuperAgent AI is also feeding
its own algorithms or proprietary methodology that will eventually allow those agencies to launch fully autonomous AI agents in the short future, she said. These AI agents will serve a role in helping “the people that they have on their teams.”
For now Veskovic said that the sales platform is helping human producers by giving them the support they need to succeed. “We are increasing cross and conversion rates for existing agents, increasing the number of policies per household, helping them more efficiently go through the sales conversation, and with analytics, reshaping how insurance sales managers are managing teams,” he said.
“You will not only know approximately what your team is doing and what it is that they delivered at the end of the month, but you will know exactly the quantity and the quality of their activities,” he said. That process also creates a self-learning loop for the SuperAgent AI tool, he added. When it comes to a future of fully autonomous AI agents that provide true quoting and binding of new business, there are hurdles to overcome, including integration with outside tech systems, regulation, and potential E&O exposures.
“We are very early on,” Veskovic said. “Yes, of course we have this in mind, but the thinking is simple,” he said. “A human makes mistakes,” he noted. “Our solution makes less mistakes for sure.” Even so, the final review of a “report” on activities will be a human. “So, as a human, I can oversee what my tool did, and then maybe call the customer and say, ‘Hey, I have to make a small adjustment.’” But
because of the AI’s self-learning loop, Veskovic said he doesn’t consider these experiences to be a “great threat” when it comes to E&O exposures. “The insurance agent is the one responsible for delivering the solution to the client,” he said. The agent holds the license to sell the insurance product, he added. At least for now.
Veskovic hopes to change regulatory requirements that will allow AI agents to be the selling agent some day. “So, while we are changing the legislation, we will take on the responsibility to make sure that we execute everything properly and we will be compliant in all the 50 states,” he said.
For now, “we are collecting conversational and behavioral data, completely anonymized, in order to improve the loop and improve the performance of our solution to serve the customer better and to serve the agency better,” Veskovic said. “That allows us to match what the needs are—not just price, location, the base information, but really understand the deeper context that today, outside of SuperAgent, just does not exist in insurance sales.”
Human vs. AI
So, the big question is will human agents continue to be needed in the future of the agency system?
Rabinowitz thinks yes. “What we see in terms of the consumer sentiment, what clients like when they’re purchasing insurance is to have a trusted source that they can rely upon and ask questions,”
he said. Even in areas such as personal lines or small commercial. “There’s always going to be a need for that when a client is purchasing insurance, to have someone that they can rely on to ensure they’re getting the right information and making the right decision,” he added.
‘The independent agency channel is relationship focused, and I don’t see people fully 100% going away.’
“What we need to really focus on is using technology to augment the quality and strength of those human-tohuman relationships that we build with our clients and not lose sight of that,” Rabinowitz added. He said it’s important to think about incorporating
technology into that process of building and maintaining a relationship. That’ll be the challenge that agencies will face in the future, he said, striking the right balance between automation and people. “But not losing the special quality of having a relationship with a client that keeps them coming back and keeps the trust there.”
ACT’s Connor thinks the agencies that are adopting AI successfully right now will see a shift in what’s needed from their human workers. “It’s freeing up time for others so that they can still focus on what they do best, and that is the relationship business of talking to clients and helping them from that advisory capacity,” she said. “The independent agency channel is relationship focused, and I don’t see people fully 100% going away.”
SuperAgent’s Veskovic sees a big transformation in agency roles as a result of artificial intelligence in the future. “I’d say the job as they know it now will be eliminated,” he said. “It’s just a matter of time.”
Hanley agrees with that predic-
tion and more. He thinks the era of maintaining a personal relationship with clients as it is today will eventually come to an end. People will grow accustomed to using AI voice agents and chat functions in insurance as they are already used to using them in other areas of their lives, he said. “I think that the narrative (of personal relationships), while it’s been true for a while, is coming to an end.”
Hanley also knows that is not a popular thought among the industry. “There are a lot of agents who will say things like, ‘Well, we want to maintain our personal relationship.’ That to me is, and I’ve always said this, and I’ve caught a lot of heat for it, is very selfish thinking,” he said. “I think a lot of independent agents apply the way they want to do business with their clients versus understanding the way their clients want to do business and then adapting to it,” he said.
But in reality, Hanley added, no one really knows how much the industry will change as a result of AI in the future. “We have no idea. No one can predict it. I can’t predict. All I know is everything is going to be different,” he said.
Who knows, maybe there will be a counter movement back to humans, Hanley said.
“Do we get so fed up with AI voice that there’s this counter move to want to talk to a human, and maybe (consumers) pay more for that? Are there going to be VIP white glove agencies that say, ‘Hey, you can pay an additional fee to work with a human versus work with an AI agent?”
It’s truly the Wild West of agency AI, according to Hanley. At least for now.
Special Report: Best Agency to Work For
Employees Come First at Mackoul Risk Solutions
By Andrea Wells
Pay your employees well and treat them better.”
That’s the winning ticket to success, according to Ed Mackoul, CEO of Mackoul Risk Solutions, the Long Beach, New York-based agency that won the 2025 Best Agencies to Work For Silver Award for the East region.
“Everything we do, we do with our staff in mind,” Ed told Insurance Journal. “Many agencies and many businesses say the client comes first, but our philosophy is our employees come first.”
Employees nominating the agency say they feel valued and appreciated by management and co-workers. “We feel that each and every day,” one employee said about the firm. “It really makes a difference working for and with people who value you.”
The company allows for a work-home life balance with great compensation and benefits, another employee said. “Mackoul Risk Solutions is the best agency to work for because of how well employees are treated. We work hard and are recognized for our hard work. We have the ability to work from home but also bond with our co-workers at our monthly team building events.”
Ed said that maintaining a focus on employees has helped the agency grow from a small family-owned agency to a much larger organization.
“We have grown tremendously and have many more employees than we did when I first joined the agency in 1995, but we try and keep that same
philosophy,” he said. “We care about our employees. We want them to not only be successful but to be happy doing so, and that includes making sure they have proper work-life balance.”
Ed said to be successful in today’s insurance market agencies need to think outside the box. “Many agencies still don’t allow their employees to work from home,” he said. And that’s a missed opportunity, he believes. Mackoul is fully remote, with 10 workstations available in the main Long Island office should employees choose to work in the office for a day or more. “That may not be for everyone, but a hybrid model is certainly possible,” he said. “Many of our employees we have hired over the past few years are out of state, and they are all excellent. Some people think that you lose your culture, but we have found a way to maintain it.”
The agency holds monthly team building events in person and online events for remote staff that live far away. “This past month we all went to a place that had a golf simulator and had some fun trying to win closest to the pin, the longest drive, and other events all while having a few
drinks, a few appetizers, and many laughs,” Ed said. While out-of-state employees cannot make those events, Mackoul brings everyone into town for its annual holiday party.
“The agency takes a unique approach to team building and work-life balance,” said an employee nominating the firm. “We are encouraged to connect and understand our co-workers on deeper levels in our day-to-day as well as organized team gatherings or events. As a result, we carry a mutual respect for each other’s time and hard work.”
Ed encourages other agency owners to consider work-fromhome if they do not offer the option already. “Not only does
that benefit the employee, which in the long run benefits the employer, but it also opens up the job pool,” he said.
Ed said that while the agency has won several awards over the years, Insurance Journal’s Best Agency to Work For award means the most. “This one is truly an award based upon how happy our employees are, and for that reason, I feel it should be treasured most.”
To make a great place to work, keep employees first, he recommends. “My advice has been and will always be: pay your employees well and treat them better.” And give them the tools they need to succeed, a path for growth, and an open door so they feel heard, he added.
Mackoul Risk Solutions Long Beach, New York
Mackoul Risk Solutions team building event.
Ed Mackoul on running a fully remote agency: 'Some people think that you lose your culture but we have found a way to maintain it.'
Special Report: Best Agency to Work For
Midwest
Port Washington, Wisconsin
Building Something That Matters: Ansay & Associates
By Allen Laman
You have to give to get.”
When Adolph Ansay opened Ansay & Associates in 1946, that family mantra guided his approach to business. So, he poured his time, resources, and heart not only into improving the Midwestern land he called home but also into serving his community.
Nearly eight decades later, that spirit persists. And for the second straight year, Ansay & Associates won the Silver Award in the Midwest region of Insurance Journal’s Best Agency to Work For contest.
Ansay rose to the top on its dedication to employees and clients. Many of the independent agency’s team members praised leadership for their focus on both internal and external relationships and commitment to volunteer outreach.
“I believe Ansay to be one of the most innovative and people-centric agencies out there,” an employee said in their survey response. “Executive leadership consistently demonstrates a focus on stewardship of their people and with their resources. Ansay seeks to be innovative in their approach to technology and talent development, which I feel contributes to an overall focus on agency growth.”
The Port Washington, Wisconsin, agency has grown to serve more than 14,000 businesses and 35,000
individual customers across Wisconsin, Minnesota, Upper Michigan, and Florida.
The business is known for the trademarked Ansay Approach—a relationship-driven and solutions-oriented philosophy fueled by grasping and addressing each customer’s unique needs.
The approach begins by identifying and understanding client needs and exposures and continues by developing and offering strategies to address the needs, exposures, and issues identified. Ansay designs and implements tailored programs to meet client needs and makes proactive changes as needed. This mindful methodology seemingly extends to the agency’s treatment of staff. Many employees shared that the agency excels at recognizing and appreciating hard work and creating an environment that values work-life balance.
“We have a supportive, collaborative team that genuinely cares about each other and about our clients,” a respondent said. “Leadership is approachable, open to new ideas, and committed to helping employees grow in their careers. I appreciate that we’re encouraged to share input, improve processes, and take initiative, which makes the work feel meaningful.”
Beyond professional growth, employees also value Ansay’s emphasis on volunteerism. Respondents shared that the agency has a policy that
provides paid time each year to enable employees to give back to causes close to their hearts. One employee shared that this initiative supports community engagement and allows workers to make a meaningful impact outside of their day-today responsibilities.
“I’m proud to work for an organization that encourages us to contribute to something bigger than ourselves,” they said. “It’s incredibly rewarding to be part of a workplace that supports both personal growth and community involvement.”
According to its website, Ansay & Associates remains among the largest and fastest-growing independent insurance agencies in Wisconsin. It is now led by Adolph’s son, Mike Ansay. Mike told Insurance Journal that the agency is built on trust, service, and long-term partnerships that protect what matters most to its clients.
The business’ leadership has learned that culture isn’t created through slogans but through daily actions. Supporting mental and physical health, encouraging
community involvement, and fostering growth opportunities all make a difference, Mike said.
“Our leadership philosophy is rooted in servant leadership,” he explained. “We remove barriers, listen closely, and empower our people to succeed. That’s the Ansay way: put people first, and everything else follows.”
Employees today want more than a paycheck, Mike added. They want purpose, flexibility, and a sense of belonging. The best workplaces listen and respond to what their teams need, he said.
“There’s no better compliment than one that comes from within,” Mike shared when asked about the Best Agencies to Work For award.
“When our own people say Ansay & Associates is a great place to work, it tells us we’re living our values.”
Ansay & Associates
Mike's selfie shows Ansay team members gathered for an employee event in 2024.
Every employee at Swingle Collins & Associates brings something unique to the table—and every opinion is welcomed and valued.
“We want the entire team to want to come to work each day,” said President Dan Curtis. “The insurance industry can be hard, so we make our agency a place for all of our people to feel a deep sense of inclusion and belonging.”
The Dallas, Texas-based agency, founded in 1982, serves a growing roster of regional, national, and international clients. Its support of employee success across the board earned the title Best Agencies to Work For Silver Award in the South Central region.
“Insurance is a hidden gem of an industry,” said Frank Swingle, founder and CEO.
“In general, we find that folks who come into the industry with a company that prioritizes culture tend to stick around because it is so great.”
It all starts with hiring great team members, who often come from outside the insurance industry.
“We leverage that tailwind and primarily recruit talent from outside the industry and assimilate them in our culture at Swingle Collins—a place we know people love to be!” Curtis said.
“We also built our agency on ‘who a person is’ that we’re hiring, not on ‘what they can do for us,’” he added.
Employees said they feel valued for their unique perspectives and specific contributions. The agency kicks off each week by recognizing team members who exemplify the agency’s core values, boosting confidence and setting a posi-
tive tone for the week ahead.
The agency’s flat structure and dedication to open communication help create a supportive family atmosphere, where the owners know the name of every employee—no matter the title—and welcome opinions, input, and feedback. Leadership takes the time to think about how their decisions impact not only the bottom line but also the people who make everything work.
“We’re very horizontal,” one nominating employee said. “Anyone can walk into anyone’s office at any given time about work or personal life/advancement.”
But the tight-knit team is far from constricting, thriving on collaboration rather than competition. Ongoing growth helps create opportunities within the agency, so employees can advance without going on a job search.
“It’s a place where hard work is recognized, relationships matter, and you can truly build a long-term career.”
‘The insurance industry can be hard, so we make our agency a place for all of our people to feel a deep sense of inclusion and belonging.’
“The firm emphasizes collaboration, entrepreneurial thinking, and deep expertise, so every team member has both autonomy and support,” said one nominating employee. “It’s a place where hard work is recognized, relationships matter, and you can truly build a long-term career.”
And that’s great for employees, many of whom are industry veterans and commented that they are with Swingle Collins for the long haul.
“I have been in the industry for close to 30 years, and Swingle Collins is hands down the best agency I have been a part of,” said one nominating employee.
“Swingle Collins has a great culture and all of us are truly friends,” said another nominator. “I can’t imagine working anywhere else.”
Special Report: Best Agency to Work For
West
Morris &
San Luis Obispo, California
Focusing on Culture, Employees & Clients Keeps Morris & Garritano on Top
By Jahna Jacobson
Ateam that loves what they do does it better.”
Those sage words are the wisdom of Kerry Morris, chief operating officer at Morris & Garritano Insurance.
The San Luis Obispo, California, agency was nominated by dozens of employees for its focus on work-life balance and opportunities to advance, making Morris & Garritano this year’s Best Agencies to Work For Silver winner in the West.
People are at the top of the list when it comes to prioritizing time and resources, Morris said. “We understand that employees, our team, are one of our greatest assets and why we can do what we do.”
The family-run agency has a strong focus on flexibility, allowing employees to prioritize professional and private lives, Morris said. “We always put a focus on our culture and employees.”
Morris’s father, grandfather, and brother were all part of the industry and firm. She joined in 2002.
“I was able to work alongside my dad, Greg Morris, and was able to learn not just about insurance but people,” Morris said. “Building relationships is an essential part of our industry—with clients and employees.”
The company has had a longstanding belief in flexibility and had remote work policies in place long before the COVID-19 pandemic forced
most employees to work from home.
“It made us understand that we can hire people and work well and effectively even when they are not within our four walls,” Morris said. “More than ever, it got us out of some of our more rigid social norms.”
“We leaned into flexibility, even for employees who may live only 20 miles from the office.”
One nominating employee said, “While I live within the same county as my agency, I’m able to work from home with a very flexible schedule that allows for school pickups and drop-offs, as well as spending time with my young son. This has not been detrimental to
my career. Work-life balance is encouraged at our agency.”
Today, most employees are back in the office three days a week.
New hires are adding another dimension to the definition of an ideal work environment. There’s a desire for face-to-face interaction, structure, and networking, Morris said.
“Meeting and attracting new hires, they are looking for a vibrant in-office culture,” Morris said. “The new generation wants to advance quickly. It’s a big emphasis on the fact that you can really focus on a career path, that they really understand where they are going to be, which is important.”
Several nominating employees are excited about the advancement opportunities that are available at the agency and the encouragement and mentorship offered by management.
“The agency is very
growth-focused and helps me achieve my personal goals, which in turn, benefits them as a company!” said one nominating employee.
“I am relatively new to the company, but I am extremely impressed by their overall performance and the way they treat and take care of their employees,” said one new hire. “I feel comfortable in my environment and am encouraged by their willingness to help me grow and achieve my own goals, as well as the company’s.”
More than just an insurance agency, “it’s a place where people genuinely care about one another and the clients,” said one nominating employee. “Leadership invests in our growth and well-being, and colleagues show up for each other in ways that go far beyond ‘just work.’”
“I feel trusted, supported, and challenged, which makes me excited to come to work every day,” they added.
“The culture is one of collaboration, kindness, and purpose, and it’s rare to find an organization where those values are not only stated but lived daily.”
Garritano
Kerry Morris, chief operating officer at Morris & Garritano Insurance
Ellie Cattaneo, Sara Holloway, Cecilia Nutting, and Angela Toomey at the San Luis Obispo Food Bank Hunger Awareness Day.
Idea Exchange: Ask the Insurance Recruiter
Why Remote
Hires Can Be Your Agency’s Best Recruiting Solution
Before I make my case about the value of remote hires, it’s important to acknowledge the reasons agencies, large and small, tell me they don’t want to hire remote employees.
1. “I had a bad experience.”
2. “Remote employees don’t perform as well.”
3. “I can’t train remotely.”
4. “I have to pay more to adjust to their cost of living.”
5. “They are too far away to attend client meetings.”
6. “Remote employees don’t work as hard.”
7. “We don’t promote remote employees.”
8. “If we allow a new hire to work remote ly, then everyone will want to.”
Remote hiring isn’t 100% perfect, but then again neither are in-office hires. The reality of the insurance job market is that it’s hard to find experienced insurance talent. The more expertise and specialization you need, the best option is remote.
Reason #1: Access to Top Talent
One of my clients has been searching for a commercial account executive for over 90 days in a mid-sized city with limited talent at this level. After such a prolonged search, they face a choice: keep waiting, overpay, lower their expectations, or go remote.
Opting for remote hiring offers several benefits:
• Maintain high standards: You won’t have to compromise on experience or alter your expectations. In many cases, you can be more selective, require specific systems experience, or maintain your salary requirements.
• Wider candidate pool: With remote options, you can evaluate significantly more candidates, leading to more informed hiring decisions.
• Potential cost savings: Insurance professionals value remote work and may accept lower salaries in high-cost areas or be more affordable in rural areas than what you’re accustomed to paying, allowing you to acquire talent for less than in your local market.
Reason #2: Changing Relocation
Trends
Relocation is less prevalent today than it was a decade ago. Remote allows individuals to remain in their preferred locations, enabling them to care for aging parents, enjoy proximity to extended family, or accept leadership roles without uprooting families.
Reason #3: Targeting Specialized Candidates
2025 has been a year for agencies to hire
specialized talent. As you pursue larger national accounts and develop niche verticals, the talent you need may not exist locally. To compete effectively in those situations, you need to tap into the remote talent pool.
Reason #4: Faster Hires
By Mary Newgard
Time is a crucial metric for measuring recruiting success. There’s no reason an account manager job should be open for more than 45 days or an account executive job longer than 60 days. In those instances, explore the “What If” scenarios. What if we can’t find a local candidate? Then what? The answer is to go remote.
Reason #5: A Strategic Retention Approach
The desire for remote work is one of the biggest reasons insurance professionals start a job search. Your employees regularly receive messages from other agencies about 100% remote jobs. If that’s what they want, but you don’t ask, you’ll find out when they resign, regardless of how you make new hires. In an ironic twist of fate, in most cases agencies backfill the vacancy with a remote hire.
In Summary
The question I pose to you is this: Is remote hiring at your agency a “Get To” or a “Got To”? If you agree that the benefits of remote hiring outweigh the drawbacks, what is holding you back from embracing this approach more frequently in your recruiting process?
Newgard is partner and senior search consultant for Capstone Search Group, a national recruiting firm dedicated to the insurance industry. For questions and comments, email: asktherecruiter@csgrecruiting.com.
Idea Exchange: Is It Covered?
Logic & Language and Forms & Facts
The Government Action Exclusion
June marked my 56th year in the property and casualty insurance industry.
When I speak at conferences and conventions, I tell a usually much younger crowd that I’m old—older than ISO, even older than FedEx, cable TV, and personal computers.
How old am I?
By Bill Wilson
When I started in the industry, it was common for insurers to operate separate companies for property and casualty lines. I remember when I would come across 1943 New York Standard Fire Insurance Policies (NY SFP) in the marketplace and people still questioned whether multi-line policies like homeowners would really catch on and whether replacement cost coverage was a good idea.
Which brings me to this month’s column about an exclusion that’s been around longer than me. I’m not sure how long, but I have a couple of property policies from the late 1800s that included it. The first standardization of the exclusion I’m aware of was in the venerable 1943 NY SFP, which read:
Perils not Included. This Company shall not be liable for loss by fire or other perils insured against in this policy caused, directly or indirectly, by…order of any civil authority except acts of destruction at the time of and for the purpose of preventing the spread of fire, provided that such fire did not originate from any of the perils excluded by this policy…
What prompted this month’s column was an agent inquiry about an Immigration and Customs Enforcement (ICE) raid on a processing plant that resulted in food spoilage and likely a business interruption claim when 80% of the plant’s workforce might need to be replaced and retrained in order to reopen. The insured in this case was facing a denial citing the Government Action exclusion in his causes of loss form. This occurred at the same time that
I was preparing to participate as a presenter in a webinar for attorneys on the Government Action exclusion found in ISO commercial property causes of loss forms, homeowners forms, and their personal auto policy. The two other presenters were defense attorneys who worked primarily for insurers. I was asked to present from a policyholder perspective. I couldn’t debate the application of the exclusion which virtually all courts had found to be clear
and unambiguous. I could only challenge the absolute nature of the exclusion as being overly broad.
As best as I can tell, these exclusions were added to ISO’s commercial property line in July 1988 and to their homeowners program in October 2000. A limited version of the exclusion was added to their personal auto policy in December 1989 and broadened significantly in June 1994. Oddly, the exclusion does not appear in
ISO’s primary business auto coverage form. The ISO personal auto exclusion applies to “destruction or confiscation by government or civil authorities.” Sometimes law enforcement may take possession of a vehicle used by an alleged criminal. Excluding such losses from insurance coverage is arguably good public policy. However, I gave examples in the webinar of two instances where an innocent auto owner’s vehicle was stolen and used
in the commission of a felony. The vehicles were confiscated by authorities and held while the case went to court, a process that took over two years in one of the cases. The innocent insured was denied coverage by his auto insurer, citing the “government or civil authorities” exclusion.
In ISO’s December 1989 personal auto policy edition, since the insureds in both cases were innocent of any wrongdoing, this loss would have been covered but, as of the June 1994 revision and later editions, this loss is arguably no longer covered. However, an exception is made for loss payees who can recover under a loss payable clause for their financial interest in the vehicle. Figure that one out—the innocent lender is covered but not the innocent insured.
ISO’s homeowner program policy forms exclude:
Governmental Action Governmental Action means the destruction, confiscation or seizure of property described in Coverage A, B or C by order of any governmental or public authority. This exclusion does not apply to such acts ordered by any governmental or public authority that are taken at the time of a fire to prevent its spread, if the loss caused by fire would be covered under this policy.
To illustrate, in 2015, a $580,000 Colorado home was demolished after police damaged it apprehending a shoplifter. In 2018, Georgia law enforcement officers damaged a 78-year-old man’s home which they had mistaken for a drug dealer’s home. In 2020, a SWAT team in McKinney, Texas, caused $50,000 in damages to a woman’s home while apprehending someone wanted for allegedly abducting a child. All of these claims for damage caused by law enforcement were denied by the insurers in question, citing the Government Action exclusion.
The problem with these denials is that, under “qualified immunity” laws, the victims usually have no recourse against the government entities responsible for these losses. These types of events are not rare, but they are relatively infrequent and, in my opinion, insurable. However, I’ve never seen a buy-back for this exclusion, not that most insureds would buy it if it
was available given the high unlikelihood of a loss.
My argument in the webinar was that, while there certainly can be catastrophic government action losses that merit exclusion, the types of occurrences cited above are fortuitous and insurable. This is evidenced by the ISO personal auto policy edition prior to June 1994 when the exclusion in that policy only applied to “you or any ‘family member’…Engaged in illegal activities…”
Exceptions can be made, as is still the case in ISO’s personal auto policy with regard to innocent loss payees, without even remotely imperiling the solvency of an insurance company. This appeal was unsuccessfully made to ISO by the Big “I” over the course of several years through their technical affairs committee and the Mid-America Insurance Conference which meet with ISO annually.
My position in the webinar was that the purpose of insurance is to insure. While perhaps the fairest solution to this issue is to legislate less onerous “qualified immunity” statutes, this risk is insurable. It is no secret that the insurance industry is not held in the highest esteem by the public. One reason might be exclusions like this that, from a consumer perspective, defy logic.
If you look at the reasons why exclusions exist, none seem to apply to the examples provided in this article. The losses are fortuitous and unexpected. They are not catastrophic. They do not represent a frequency or severity problem that makes them uninsurable. There are, as best as I can tell, no coverage options available under other forms of insurance. Finally, there don’t seem to be any risk management alternatives such as loss control. So, why not provide coverage for an appropriate, and likely minimal, premium?
What do you think?
Wilson, CPCU, ARM, AIM, AAM is the founder and CEO of InsuranceCommentary.com and the author of six books, including the Amazon 4.8 star rated “When Words Collide…Resolving Insurance Coverage and Claims Disputes” which BookAuthority ranked as the #1 insurance book of all time. He can be reached at Bill@InsuranceCommentary.com.
Idea Exchange: Agency Management
Tips to Make the Most of Carrier Relationships
Iremember talking with an agency owner a few years ago who had gotten upset with an insurance carrier with whom they were working. This has been a frequent occurrence in the last few years as the hard market has added frustration to the daily lives of practically everyone in the personal lines sector.
with a carrier representative may have negative consequences for an agency that may never go away.
By Tony Caldwell
In this case, however, the agent had lost his temper and said several unfortunate things to the carrier’s local marketing representative. Though this unprofessional outburst did not end the agency or sever its carrier relationship, it certainly didn’t do anything to further business or the group’s reputation.
While most carrier-agency relationships do not reach such a level of stress and strain, there can certainly be challenges. Long-term, successful partnerships between an agency and the insurance companies it represents must be nurtured and carefully managed.
Here are some proven success strategies to maximize yours.
Play the Long Game and Don’t Lose Your Cool
It is important in any relationship to treat all parties with respect. When someone fails to apologize after an outburst, for example, the breach of trust and goodwill can never be fully healed. It is normal to get frustrated and even angry at times, but allowing those emotions to air in an unprofessional manner is simply inexcusable.
Every agency owner should know that what is communicated by you and your staff, whether in writing or verbally, is stored in a carrier’s customer relationship management (CRM) system—forever. Further, marketing representatives typically have careers lasting decades, and whether they remain a local representative, get promoted, or even change insurance companies, they could still impact your business. Burning bridges
Remember, in every interaction with carrier personnel, just like in a successful marriage, you are building a permanent relationship. Consequently, tact, timing, and careful consideration of what you say, do, and put down in words are non-negotiables if you want to sustain long-term, profitable carrier representation.
Follow the Rules
It can be frustrating for agency personnel when seemingly unreasonable company underwriting guidelines or marketing restrictions prevent them from placing business or helping a customer.
Sometimes, this triggers the natural human tendency to cheat. Though not a popular notion to talk about, I’ve seen and heard of many cases from insurance company executives that prove it to be a real problem.
Integrity is required. You simply must not break the rules—no questions asked. And if you find a staff member doing so, the issue should be corrected immediately and their future employment brought into question.
Help
Everyone needs help at some point, even your carrier partners. Sometimes they need an agency’s help to solve their problems. Years ago, I recall, one of the
best commercial carriers with which my agency worked needed to reduce their roof exposure but didn’t want to actively cancel business. They asked if we could move several accounts to help them out. While it was not particularly difficult for us to do, that act of assistance was appreciated and paid dividends in terms of our relationship.
Agents need help from time to time with hard-to-place risks, managing a claim, or other issues. The carriers that go out of their way to help us are the ones with which we want to do more business—and the same goes for insurance companies.
Don’t Overestimate
The annual planning process can be challenging, especially for new or rapidly growing organizations. It’s hard to know how your sales efforts may turn out a year
in advance, and it’s natural to want to express confidence in your capabilities, especially when trying to interest a new carrier. But do not overpromise. Failing to deliver on commitments is unacceptable. It creates a business hole for the carrier’s local marketing representative, potentially impacting their bonus, and it prevents carriers from effectively allocating resources. It can also damage your agency’s credibility. Be conservative in your estimates.
Do Communicate Frequently and Completely
One complaint I often hear from agency owners is that carrier representatives ask too much of their time. Agency team members are always busy, but these visits are necessary and inescapable. So, manage the process by proactively scheduling visits when you can and use an agreed-upon
agenda to keep the meetings effective and on track. Be sure to allow time in the agenda for both parties to share information and feedback to ensure an engaging two-way conversation.
It’s also important to be proactive in your communications with your carrier executives. Don’t let bad news—or good news for that matter—sit for too long. Email is a wonderful tool for many things, but some news, particularly when it is unwelcome, is best given over the phone, via Zoom, or in person.
Celebrate Success with Insurance Carriers
A big part of the success of any independent agency is maximizing the opportunities their insurance carriers provide, whether that’s special pricing, market access, or compensation. When your agency is successful, it can be beneficial to think about how your carrier(s) contributed to those achievements and recognize them for it. Something as simple as a thank-you email goes a long way in building long-term trust and strong partnerships.
If you decide to have more formal celebrations for achievements in the agency, why not invite carrier personnel to attend? Including them can make them feel appreciated and let them know they are a valuable part of your team. Strong, longstanding, and mutually beneficial personal and organizational relationships between agencies and their insurance companies is the foundation upon which long-term business success is built. But in the urgent stress of getting everything on your to-do list accomplished, it’s easy to forget to nurture these critical relationships and all too easy to damage them with an ill-considered word or action. On the other hand, careful, thoughtful, and proactive management of these relationships may very well be a driver of incredible success for you and your agency.
Caldwell is an author, speaker, and mentor who has helped independent agents create more than 250 independent insurance agencies. Website: www.tonycaldwell.net. Email: tonyc@oneagentsalliance.net.
Idea Exchange: Risk Management
Bringing People and Artificial Intelligence Together to Mitigate Risk
ABy Andrew Zarkowsky
rtificial Intelligence (AI) is a valuable resource in today’s economy with the potential to reap great rewards in many avenues of business. However, as with any developing technology, it comes with new challenges. In a recent study by The Hartford, nearly half of the business leaders surveyed said they have risk concerns about using AI.
Whether it’s hesitation about software liability or integration concerns, companies want to understand and mitigate their risk as they build AI tools for their businesses and partnerships. After defining the business problem and assessing the AI project benefits, companies need to outline the possibilities of failure.
A key component of a company’s plan should be an emphasis on how to integrate the many silos or departments for optimal results.
AI and Risk Management
Looking at AI from a risk management perspective reveals a need for nuance. There are currently no global standards for developing AI, and best practices are still developing. Today, the field is self-policing with unbridled property, financial, and casualty risks. So, it’s increasingly important to focus on risk management techniques to improve data quality, testing, warnings, checks, and other processes that will help reduce or mitigate exposure to your business if something does go wrong.
Early Collaboration Enhances AI Quality
Today, most large businesses run on sophisticated technology and some type of AI model. According to the Stanford Human-Centered Artificial Intelligence (HAI) Institute, in 2024, the percentage of survey respondents reporting AI usage by their organizations jumped to 78% from 55% in 2023.
If that technology, including AI, fails to produce accurate and practical
results, it can impact functions across the company. For instance, if project leaders are not aware of—and able to access—all data across departments, they cannot instruct AI technology to include it. That means the end user will think they are making decisions based on all available information, when they are not. Fostering an atmosphere of cooperation across the company can help protect the time and money invested in AI and pinpoint issues as it is implemented.
It is important to ensure that collaboration comes from across the entire company at the very beginning of the AI implementation journey. Otherwise, a company can run the risk of wasting valuable time and resources and may have to start projects over from the beginning.
Connecting the Data
Departments that operate in silos limit the capacity of AI to interpret, analyze, and share data. To address these new challenges, modern strategies value collaboration across company departments at the outset
of a project, preventing the inefficiencies and breakdowns that can hinder progress and compromise the result.
Relying on siloed data when attempting to blend multiple sources of learning can create inefficiencies, miscommunications, and compromised data quality. The need for interconnectivity isn’t native to projects implemented with AI, but it is critical in this arena as any breakdowns from the beginning can render the full scope of a project ineffective. For all the effort placed on an AI project, changing the silo mentality is worth the time.
Connecting the People
To really use AI at its highest level, companies need to have buy-in from their employees and an agreement among departments to share and explore this new technology. Top-down messaging from leaders can jumpstart the process. Don’t just announce the rollout of AI in the workplace. Explain how it fits into the company’s goals and how it helps address issues and needs across departments. Make sure to loop everyone in along the way.
These tips can help with planning for AI collaboration across departments:
• Identify stakeholders: This should begin and end with risk managers but also include all business units and other departments, such as compliance and legal.
• Create subcommittees: Communities of employees with a vested interest in AI can help establish objectives and promote information sharing. Include a variety of stakeholders to create smoother implementation processes and set up these communities with reoccurring meetings to ensure plans and executions are hitting the necessary marks.
• Develop a plan of action: AI projects need outlines and clear objectives stating what falls within and what is out of scope, so that all parties know exactly how the project is expected to run. Just like AI learns as it goes, so should the team. Managers need to be prepared for all outcomes and pivot as needed.
Most companies understand the need
to start testing AI in order to stay ahead of their competition. How to manage the risk associated with this technology is the challenge. Connection across departments and communities is a key piece of success. It’s essential to be risk-conscious moving forward. And yet, with the increased speed of technology and AI changes, the bigger
risk is doing nothing at all. Artificial intelligence is transforming the landscape of insurance and risk management. Explore additional perspectives and insights on business technology.
Zarkowsky is head of artificial intelligence (AI) underwriting at The Hartford.
Idea Exchange: Agency Technology
4 Things to Consider to Streamline an Agency Tech Stack
As agencies plan their 2026 budgets, they face an exciting opportunity to unlock more value through technology.
By Daniela Ivey
My advice to agency leaders? It’s time to streamline your tech stack. What does this look like? Streamlined technology connects tools so information flows smoothly without extra work. It means faster processes, fewer errors, and more time spent on growing the business.
By integrating your top products, you can create a better data environment and user experience, unlocking four key benefits across your agency.
Benefit 1: Optimized Business Strategy
Streamlining your technology often enables better integrations so data can flow seamlessly between systems. That equates to data that is consistent, easier, and faster to update, reducing duplicate
work and costly errors.
Equally important, better data means agencies can access better insights about their business and make strategic decisions for the long term. Is there a line of business more profitable than expected? Or a geographic region seeing prices crawl higher and higher? By having an end-to-end view of your data, it’s easier to see opportunities to drive agency revenue and growth.
This also ensures agencies can focus on what matters at the right time. For example, most carriers are required to provide a 45-day notice if they’re not renewing a policy. Those 45 days fly by fast, and in the worst cases, leave an agent working overtime and a policyholder without proper coverage. With connected technology, agencies can analyze risks and renewal data in real time. This lets agents proactively shop for new policies for their clients before receiving any notice from a carrier.
Streamlined technology transforms scattered data into powerful insights, giving agencies the edge to grow faster,
make smarter decisions, and capture every opportunity.
Benefit 2: Employee Efficiency and Success
Large agencies use an average of 10 solutions to run their business. Adding more technology platforms drives up training cost, complicates change management, and often makes it less efficient for agency employees who are navigating disconnected and confusing tools.
Think about when a new hire starts on day one. The technology they use will factor into their onboarding experience and ultimately how fast they get up to speed and can start selling policies. This will not only contribute to employee success, but it’ll save the agency time and money on training costs.
When information flows seamlessly between systems, employees can feel confident in getting exactly what they need when they need it. This clarity reduces errors, boosts confidence, and helps teams deliver better results with less effort.
Benefit 3: AI-Readiness
Right now, we’re seeing three key use cases for AI in insurance workflows, and integrated technology makes them smoother by connecting data and tools in one place. This allows employees to access insights faster, reduce manual work, and make more informed decisions.
The first common use case for AI is workflow management, which includes streamlining common tasks with AI automations and tools.
For example, independent agencies rely heavily on email as part of their workflow. Most new tasks begin with an email, whether that’s an inbound from a new prospect or a request for a policy change from an existing customer. Integrated software products, enabled with AI automations, can ingest the details of the email, identify the client in the AMS, and then create and assign the task.
The second most common use case we’re seeing for AI is predicting risk renewals. Smart agencies are using AI and machine learning to dive into claims history and pull insights from the patterns, like areas that are more likely to have carriers pull out, or policies most likely to
see an increase on premiums. But for AI to help effectively predict risk, it needs access to data across multiple software tools. Without integrated data, insights fall short, lacking vital information that helps agents understand the full picture.
Automated data entry is another common use case for AI.
At the end of the day, an agency management system is only as good as the data within it. It allows agencies to quickly access important client information and benchmark their data against industry standards. But entering all that data is tedious, error prone, and keeps employees away from revenue driving activities.
Data entry can be handled by AI, which reads and populates information into the system. This not only improves accuracy of the data but also speeds up the process, decreasing from around 45 minutes to only seconds.
Benefit 4: Poised for M&A
While you may not have a current appetite for acquisition, preparing your business for any M&A activity that comes your way opens the door for strategic deals in the future. Connected technology
is key to starting off on the right foot.
To begin with, any M&A process requires agencies to provide a lot of data reporting and full transparency into an agency’s book of business. This includes data about the company’s financials, the markets that are currently profitable, and what opportunities remain. If an agency is using multiple different management systems across different locations, it’s difficult and time-consuming to show the full picture. In fact, the speed of this reporting can make or break an offer, as the buyer might opt for another agency that can report on the data more quickly. But when an agency’s data is centralized, they can show value right away, leading to an easier acquisition and improved valuation.
Investing in People and Technology
Ultimately, efficiency is about investing not just in your technology but your people, as well. Start by studying your best-performing teams. Understand their workflows, the tools they rely on, and how they use technology to reduce manual work and focus on revenue. These insights will show which systems deliver the most value and how to leverage them across the organization.
Once best practices are clear, make these workflows the standard for everyone. Highperforming teams can serve as a resource, offering guidance and support to help peers adopt new processes successfully.
By focusing on your team first, identifying high performers, and standardizing operations, you can confidently roll out the best processes across the organization. When teams and tech work in tandem, the possibilities for independent agencies are limitless.
Ivey is the vice president, Product Management at Vertafore. Ivey brings over 15 years of experience in the technology industry. Her expertise spans multiple domains, including software, hardware, mobile, and web-based products.
Idea Exchange: The Marketing Connection
Communication Strategies for Insurtechs Breaking into Legacy Markets
When modern insurtech meets decades of industry experience, the result should be innovation—yet too often, it’s misunderstanding.
By Anita Nevins
While insurtech companies bring incredible solutions to age-old problems, many struggle to gain traction with traditional insurance professionals who have built successful careers on time-tested methods. The challenge isn’t just technological—it’s fundamentally about communication and trust.
Understanding the Traditional Mindset Insurance “traditionalists” aren’t resistant to change because they’re stubborn or outdated. They’re cautious because they understand the weight of their responsibilities. When someone’s financial security, business continuity, or family’s future depends on your recommendations, it can feel risky to sign-on for a significant departure from proven methods.
Traditional insurance professionals have witnessed numerous “game-changing” technologies that promised to revolutionize the industry but ultimately fell short. Remember the early wave of customer self-service portals in the 2010s that promised to slash service costs but mostly left clients frustrated and agents scrambling to fix issues? The industry has learned the hard way that stability, reliability, and personal relationships often matter more than cutting-edge features— and insurtechs need to understand this perspective when working to build meaningful partnerships.
Lead with Value, Not Innovation
The biggest communication mistake insurtechs make is leading with technology rather than outcomes. Traditional insurance folks don’t really care about AI algorithms or blockchain infrastructure. They care about solving
real problems for their clients.
Instead of saying, “Our machine learning platform processes thousands of data points,” try, “We help you identify coverage gaps 40% faster, so you can protect your clients more thoroughly while spending more time building relationships.” The technology becomes the enabler, not the headline.
Focus your messaging on familiar pain points, like reducing processing time, improving accuracy, enhancing customer service, and increasing profitability. These concerns speak directly to what keeps insurance professionals awake at night.
Speak Their Language
Insurance has its own vocabulary, built over decades of industry evolution. Respect this language rather than trying to replace it with tech terminology. When introducing new concepts, bridge them with familiar analogies. Instead of discussing “API integrations,” talk about making daily workflows more efficient. Show respect for industry knowledge while demonstrating how your solution fits into existing processes.
Provide Evidence and Social Proof
Traditional insurance professionals make decisions based on evidence, not promises. They want to see proof that your solution works in real-world scenarios, preferably with companies similar to theirs. Develop case studies that focus on measurable outcomes (rather than techni-
cal achievements). Share specific metrics, like “Reduced claim processing time by 35%” or “Increased policy renewal rates by 12%.” Include testimonials and consider offering pilot programs or limited trials.
Build Relationships, Not Just Transactions
The insurance industry runs on relationships built over years of consistent service and trust. Insurtechs that try to rush this process often find themselves hitting invisible walls. Invest time in understanding your prospects’ businesses beyond just their technology needs. Attend industry conferences, join local insurance associations, and engage in conversations that aren’t directly related to your product. Show genuine interest in industry challenges and contribute valuable insights to discussions.
Address Concerns Proactively
Legacy market professionals have legitimate concerns about new technology: data security, regulatory compliance, system reliability, and support quality, to name a few. Address these concerns head-on rather than dismissing them as outdated thinking. Showcase info about your security protocols, compliance measures, disaster recovery plans, and tech support. Highlight your commitment to regulatory requirements. Show how your solution enhances their fiduciary responsibilities.
The Bridge to Tomorrow
Successfully communicating with traditional insurance audiences requires empathy, patience, and genuine respect for industry expertise. The goal isn’t to convert traditionalists into tech enthusiasts but to help them see how thoughtful innovation can enhance their existing strengths.
Nevins is the founder and co-CEO of Direct Connection Advertising & Marketing. She manages the company and is heavily involved in strategy and planning for the agency’s clients. Website: directconnectionusa.com.
Idea Exchange: Minding Your Business
Accounting Essentials for Insurance Agency Owners Turning Numbers into a Strategic Advantage
Most insurance agency owners are driven by relationships, sales, and client service—not a passion for accounting. Yet, neglecting financial oversight can lead to overpricing producer compensation, missing growth opportunities, or misreading performance trends.
the backbone of financial clarity. Many agencies use QuickBooks or management systems like Applied Epic, AMS360, or HawkSoft with integrated accounting. The key is consistency and organization.
2. Understand Your Revenue Drivers
The agency’s books should reveal not just how much is earned but where it comes from.
By Catherine Oak and Bill Schoeffler
Strong accounting isn’t just about compliance—it’s about visibility, profitability, and equity creation. Whether running a small family agency or a multi-location brokerage, disciplined accounting empowers smarter decisions, boosts profitability, and enhances the agency’s eventual sale value.
Here’s a guide to key concepts, common pitfalls, and practical tips to simplify agency accounting.
1. Build a Solid Accounting Foundation
A structured accounting system is
Chart of Accounts. Create specific income and expense categories to identify revenue by commission type (agency bill, direct bill, fee income, overrides), producer compensation, owner draws, and detailed operating expenses. Avoid lumping all income into “commissions” and vague “miscellaneous” expense accounts—every transaction should tell a clear story.
Bank Reconciliation and Trust Accounts. Reconcile operating and premium trust accounts on a monthly basis. Trust accounts, holding client premiums, must comply with state fiduciary rules. Many state Department of Insurance audits focus on trust account errors, so segregate these funds meticulously, even if not required by the state.
Segregate Duties. If the owner is not handling the accounting, assign different staff members to manage data entry, approvals, payments, and reconciliations to reduce errors and minimize the risk of fraud.
Direct Bill vs. Agency Bill. Direct bill commissions are straightforward; the carriers pay the agency directly, typically on a monthly basis. Agency bill commissions can be done on a cash basis, like direct bill, or on an accrual basis, which is the industry standard. When agency bill commissions are accrued, they appear as income, assets (client receivables), and liabilities (carrier payables and perhaps unearned income) on the firm’s books.
Agencies using systems like AMS360 and Applied will often recognize agency bill commissions on an accrual basis, since the system is integrated with the account and invoicing. Agencies on QuickBooks will often recognize agency bill commissions on a cash basis since the data is not integrated with account transactions. Outside Producers. If outside producers are used, treat their commissions as a cost of sales, not as an expense, for accurate tax and valuation reporting.
Revenue Analysis. Run reports by carrier, product, or segment. If the firm’s top five
continued on page 48
Idea Exchange: Minding Your Business
carriers generate 80% of commissions, this concentration signals risk and informs negotiation leverage. Likewise, if the top five accounts generate 50% of commissions, this too is a concentration risk.
3. Track Expenses Like a CFO
Effective expense management separates comfortable agencies from thriving ones.
Compensation. The payroll cost ratio for the owner, employee, and producer is often 50%–65% of revenue. Track base salaries, commissions, and bonuses separately. For agencies that pay renewal commissions, analyze new versus renewal revenue to gauge long-term profitability and producer performance.
Owner Discretionary Spending. Although many businesses are run where the owners pay for personal expenses through the company, it is essential to avoid mixing personal expenses with business expenses, as this can obscure true profitability and potentially harm a business. Reclassify discretionary expenses for clear EBITDA, especially when planning to sell.
Overhead and Marketing. Monitor recurring costs, such as technology subscriptions, E&O insurance, and marketing campaigns, to ensure they align
with growth goals. Track new sales to advertising and marketing expenses.
4. Master Cash Flow Management
Profit doesn’t equal cash, especially with commission cycles causing uneven inflows.
Cash Flow Forecasts. Create an annual budget to anticipate shortfalls, factoring in commission cycles when compared to payroll, rent, E&O premiums, automation expenses, and other relevant expenses.
Line of Credit. If the agency has significant commission cycles, maintain a modest working capital line to bridge liquidity gaps, such as payroll.
Accounts Receivable. For agency-bill business, track aging reports to prevent uncollected premiums from becoming bad debt or triggering regulatory issues. Ideally, don’t bind coverage unless the client pays the full premium first.
5. Monitor Key Metrics
Accurate books unlock metrics that translate numbers into business insights, as listed below. These metrics not only show performance but also signal to buyers or lenders how well the agency is operating.
Revenue per Employee. This gauges productivity and efficiency. The benchmark
5 Accounting Mistakes Agencies Make
Lack of Identifying Revenue Source. Treating all income as commissions will not allow proper analysis and may potentially create false impressions of the actual revenue. Use accrual accounting to distinguish between agency-billed and directbilled commissions. Separately identify commissions, agency fees, contingent, and bonus income.
Skipping Reconciliations. Delayed bank or carrier reconciliations can result in missed commissions and inaccurate cash reporting.
Mixing Trust and Operating Funds. Commingling funds carries the risk of misusing client funds, followed by regulatory fines in many states. Maintain separate accounts and reconcile monthly.
Weak Internal Controls. If accounting is handled internally, failing to segregate financial duties increases the risk of fraud. Assign distinct roles to several employees for data entry and approvals.
Ignoring Cash Flow. Variable commission cycles require proactive monitoring and budgeting to avoid liquidity issues.
ratio will vary based on the type of products sold and the agency size. Agencies with revenues under $2 million and a property/casualty-dominated business mix should aim for $150,000 to $200,000 in revenue per employee or more.
EBITDA Margin. Target 25%–35% for top-performing agencies. This assumes “fair market” owner compensation and few write-offs of owner perquisites.
Revenue Mix. Diversification across carriers and lines reduces risk.
Trust Account Ratio. Ensures fiduciary health; balances should match liabilities monthly.
Growth Rates and Client Retention. Although it is not a function of accounting, solid, continuous growth in revenue and high client retention will boost valuation multiples.
6. Stay Compliant and Audit-Ready
Run your agency as if you are planning to sell it. Reviewing monthly financial statements—comprising profit and loss, balance sheet, and cash flow—helps identify trends early.
Tax Planning. As S-Corps or LLCs, work with a CPA to optimize owner compensation, manage quarterly estimates, and separate deductible expenses.
Regulatory Compliance. States like California, Texas, and Florida have strict trust account rules. Familiarize yourself with the state’s Department of Insurance guidelines to avoid fines from recordkeeping errors.
Audit Preparedness. Keep carrier commission statements, premium receipts, and policy logs organized. Clean records streamline audits and due diligence for potential sales.
7. Use Accounting Strategically
As the agency grows, accounting becomes a strategic tool to:
• Evaluate profitability and easily identify income and expenses issues.
• Support succession planning or internal perpetuation.
• Boost valuation multiples with reliable earnings data. Buyers, especially private equity firms, discount valuations for inconsistent records. Agencies with
precise revenue segmentation, validated trust reconciliations, and accurate EBITDA adjustments command premium pricing.
8. Practical Tips for Busy Owners Outsource Bookkeeping.
For a small agency, rather than having the owners handle the books, a bookkeeper should be hired who is familiar with insurance accounting to manage carrier statements, trust reconciliations, and producer splits. This will free up the owner’s time to focus on sales, while having an unbiased person do the accounting.
Periodic Reviews. Schedule at least a 30-minute block of time each month to review income and expenses, client receivables, company payables, and cash flow to gain a better understanding. Additionally, review the financials with the firm’s CPA mid-year or even quarterly to receive their expert advice.
Leverage Technology. Integrate agency management systems with accounting software to reduce manual entry. Track as much information as possible, including
client premiums, commissions, and related expenses. Track agency bill receivables and payables, even if it is on an Excel spreadsheet. Use online billing services for agency bill premiums.
Document Accounting Policies. Establish and adhere to a written accounting procedure to ensure consistency, particularly during staff changes or ownership transitions. The key is to follow it. It can be a simple check list. Contact Oak & Associates for our “Agency Accounting Checklist.”
Benchmark Performance. Compare your metrics to industry standards from the Big “I” Best Practices Study or other industry reports.
Numbers Tell the Story
Great producers drive revenue; great accounting sustains it. By focusing on these fundamentals—structured systems, precise revenue tracking, disciplined expense and cash flow management, and strategic metrics—one can transform the agency into a valuable business asset.
Start small: review the commission tracking, separate trust accounts, and schedule quarterly meetings with the firm’s CPA. These steps safeguard assets, enhance profitability, and pave the way for long-term wealth creation.
Oak is the founder of the consulting firm, Oak & Associates, based in Northern California and Central Oregon. Schoeffler is an associate of the firm. Oak & Associates is an international consulting firm that specializes in financial and management consulting for independent insurance agencies, including valuations, mergers acquisitions, sales and marketing planning as well as perpetuation planning. Phone: 707-935-6565. Email: catoak@gmail.com.
The above company has made application to the Division of Insurance to obtain a Foreign Company License to transact Property and Casualty Insurance in the Commonwealth of Massachusetts.
Any person having any information regarding the company which relates to its suitability for the license or authority the applicant has requested is asked to notify the Division by personal letter to the Commissioner of Insurance, 1 Federal Street, Suite 700, Boston, MA 02110, Attn: Financial Surveillance and Company Licensing within 14 days of the date of this notice.
Closing Quote
Can Parametric Insurance Bridge the FEMA Gap?
By Alex Kaplan
The way communities nationwide recover from natural disasters may never be the same. The National Flood Insurance Program (NFIP) expired on September 30. (Editor’s note: As of press time it had yet to be renewed.) Simultaneously, pending congressional legislation stands to transform the Federal Emergency Management Agency’s (FEMA) Public Assistance (PA) program. These two turning points will likely shift billions of dollars in disaster recovery costs off the federal government’s balance sheet. Yet these changes do not have to trigger uncertainty and doubt for public officials, or for the agents and brokers who advise them. Parametric insurance models offer a fresh alternative capable of closing funding gaps and transforming disaster recovery.
How Legislation Is Evolving
The bipartisan Fixing Emergency Management for Americans Act of 2025 advanced out of a House committee in early September. It aims to reduce assistance for smaller incidents, allowing FEMA to focus on more severe disasters. Less costly incidents would fall under the purview of “non-federal governments, survivors, and private entities.”
Should this shift happen, state and local governments could be on the hook for $41 billion in recovery costs over a 16-year period, according to The Urban Institute.
Two specific changes raise additional concerns:
• Higher disaster eligibility threshold. FEMA’s per capita indicator, the formula used to decide whether a disaster qualifies for federal aid, would increase from $1.89 to $7.56. Looking back at 870 disaster declarations from 2008-2024, The Urban Institute found that 71% would not have met the new threshold, eliminating about $15 billion in PA communities once relied upon.
• Lower federal cost share. FEMA would return its cost-sharing floor to 75% of recovery expenses, down from the 90% or even 100% of shares sometimes granted in major disasters. Instead, states and municipalities would shoulder a larger share of rebuilding costs.
Cost Burdens Shift
Although FEMA will still be responsible for losses associated with catastrophic events under the proposed
legislation, more frequent events like winter storms, severe convective storms, and flooding may no longer receive federal assistance. Consider the September 2024 storm in Oklahoma City that damaged 35,000 homes in a single day, or the over 180,000 homes in Texas that were damaged by hailstorms throughout 2024. These higher-frequency events can quickly disrupt state and local budgets, which is why our industry must look toward alternative disaster recovery approaches.
Parametric Potential
Unlike traditional insurance, which pays based on damages incurred, parametric policies pay out based on predefined triggers. A hail policy, for example, could be triggered when an insured has suffered damage, with the payout determined by the size of hailstones at the insured’s location.
Parametric insurance is gaining in popularity, potentially growing to a market value of $34.4 billion by 2033, according to Allied Market Research. Public entities across the United States have been
using parametric insurance for more than 15 years and delivering encouraging results, including faster payouts, more flexible funding, and coverage for often underserved risks. How might parametric programs work in disaster recovery?
Consider Florida’s response to hurricanes Ian and Nicole. The proposed FEMA changes would have consumed 21% of the state’s rainy-day fund ($563 million). A parametric policy—paired with a robust risk mitigation and insurance strategy—would have triggered a faster response by private insurers and reduced the financial burden on federal, state, and local authorities. Agents and brokers can and should help raise awareness for the vital role of parametric insurance in disaster recovery.
• Clarify the impact. Help customers understand how FEMA’s rule changes could affect local recovery funding. Use past weather events to illustrate where gaps may emerge.
• Leverage local connections. Agents who do not work directly with government entities likely know community leaders on school boards or local nonprofits who could benefit from learning more about parametric insurance options.
Kaplan is executive vice president of alternative risk for AmWINS Group, a global wholesale insurance distributor. He leads the development and execution of innovative risk transfer solutions, such as parametric insurance, that transform financial risk across all segments of society.
“Thank
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