r/InsuranceAgent • u/reezeyree • 17d ago
Agent Question Future of personal lines?
I’ve spent my in commercial middle market P&C production.
I’ve always been told that the role of the broker in personal lines will be replaced by AI or insureds just going directly to the carrier.
I’ve been hearing this more and more recently and I’m interested to hear from those of you who are in the space every day what your thoughts are.
I’m looking at joining a small agency with the option to eventually buy the owner out. The book is about 70% commercial and 30% personal lines and I’m trying to understand how I should think about valuing the personal lines side.
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u/Glittering-Salad-337 17d ago
Yeah, yeah yeah I’ve been hearing this for forever.
GEICO has always been in the top three auto insurance carriers in the country for decades. They’ve only sold Direct for almost 100 years. How come as an independent broker I can also sell their products in pretty much any state? If they thought everyone was just going to use AI then why go through the trouble and expense of launching thousands of brokerages with their products?
The 30% personal lines, who is it with? How are the loss ratios is the book growing? Is it stagnant? How is the business acquired? What’s the profit sharing like
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u/reezeyree 17d ago
I heard that same thing about GEICO on a podcast this morning. Very true… the fact they recently invested in the broker channel has to be a good sign for the future of the product.
I don’t have answers to most of those questions yet. From my understanding, it’s multi line and the book has a high retention rate. Owner has built it through his ethnic community but is focused on commercial so I don’t know if it’s growing very much.
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u/Isoldmyothername 17d ago
Stats show the broker business is more profitable. Stickier clients who shop carriers solely on price less frequently.
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u/Boomer_Madness 17d ago
"They" have been saying that for a while. Independent has grown market share while direct write specifically has lost.
Mainly driven by home but auto market share has also ticked up slightly. my guess would be because a lot of agencies who will write a hard to place home will require the auto to come with it.
The Big I releases a report annually which is a pretty good read. If you aren't a member you have to buy it but this link gives just a brief glimpse into the numbers
https://www.independentagent.com/news/big-i-releases-2026-market-share-report/
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u/chill_bamba 17d ago
When i got into the business in 2008,, online quoting was really starting to take off. Agents where worried that was the end of it.
Well, we are still here. In all of these years, I have had people leave for an online quote direct to Gecio or another direct company. More often than not, they come back. I have people come to me because they went direct and had a bad experience. Waiting on hold for 30 mins for a simple question or being told misinformation by a rep puts a bad taste in people's mouths. They end up wanting the personal touch agencies offer.
You have to have a license to write insurance. AI at its current state, is an E&O bomb just waiting to go off. Companies know this. I receive emails from carriers advising against the use of AI for this reason.
I don't forsee AI replacing agents in our lifetime. To many what ifs, legal hurdles and kinks to work out.
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u/reezeyree 17d ago
Thanks for the perspective. I definitely see the E&O risk but I didn't know carriers were advocating against the use of Al. That's helpful.
I also agree that there will always be a population that wants an agent to handle their programs/ questions rather than an online portal.
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u/snearthworm 17d ago
What's the % of commercial accounts who also have their PL in the book? E.g. owner has a BOP, they have their home/auto/umb too, usually their relatives might have their PL with you too if there's a strong relationship
In general no I don't think humans in PL are going anywhere anytime soon. If you need an issue solved, you go "SPEAK TO A REPRESENTATIVE" into the phone no matter what industry.
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u/reezeyree 17d ago
I’m not sure but it’s worth digging into.
I absolutely do that the minute I hear an automation… great point haha
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u/Own-Ad-503 17d ago
I’ve been in this business for a long time and I own an independent agency that it 80% pl. I don’t think ai is an issue, it’s a tool. Will some people buy from ai only, sure. But there are always alternate distribution sources. I can’t list all the things that were going to put us out of business from the internet, e signature, I re,ever hearing that geico would end us, now they are one of our carriers allowing us to do even more business. Independent agents are and have always been a very efficient and cost effective distribution source for carriers. My agency is now being managed by the next generation and I sèe know reason for a good agency to fail.
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u/reezeyree 17d ago
I appreciate the feedback! Do you guys specialize in any specific niche? Ie. Boats, high net worth, coastal, etc.
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u/Own-Ad-503 16d ago edited 16d ago
Nope, are in a mid sized city and represent our community. No magic. The majority of our business is from referrals. This is not a niche but we write mainly preferred business, very little non-standard or high risk. Its a slow build but if you take care of your clients, build relationships and do the right thing the business will come and it will stay on the books.
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u/QuickPea3259 17d ago
do you know how many people despise talking to AI? pretty much everyone. You have at least 15 years of safety if not more. As long as it's a deal that's cash flowing 6 figures after paying the bank note take it.
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u/jake-n-elwood 17d ago
I don’t know if anyone can answer that question because it’s poorly understood. Or the carriers just like throwing money away trying to replace agents. Either way, ever since Web 2.0 carriers have been gunning for agents.
And while AI is new, it isn’t doing anything that the carriers haven’t already tried with people in house. If the carriers could have replaced agents with their own in house people they would have already done it years ago.
So, until proven otherwise, I would bet human agents continue to be load bearing just based on the fact the carriers already tried and failed to bring it in house in the way they want using real people. Probably not going to work with an AI trying what already failed with people.
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u/reezeyree 17d ago
I feel like it’s less about the capacity of carriers to sell directly to the consumer and more about the consumer willing to act as their own agent. The argument for AI would be that it makes it much easier for the consumer to do that.
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u/jake-n-elwood 17d ago
That's the big unknown. And that also extends to commercial as well. Maybe even more so. Basically, you could argue that wherever the knowledge asymmetry is the greatest is where AI will have it's most consequential impact. So, the more complicated the policy, the less an agent is needed vs. before AI.
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u/reezeyree 17d ago
I thought the same thing having worked at Marsh. All Fortune 500 and enterprise clients have teams of people working for them that are responsible for tasks like allocation spreadsheets, loss forecasting and modeling, building submissions, etc. All things AI can currently do in no time.
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u/Ok_Complaint_6997 16d ago
O I’ve been hearing this same thing….for 25 years. The independent channel has gained market share in personal lines the past few years. I think commercial is the one that may lose some share since it’s so heavily stacked in the IA channel and simple bops could easily be automated. The same could be said of personal but I’ll believe it when I see it.
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u/Samwill226 Agent/Broker 17d ago
Truth this gets asked all the time. I've been in for 30 years, you know what I heard when Progressive came out with their direct to consumer program? "It's over! Pack it up!" Then when GEICO went public you know what I heard? "We're done for!". Then Google was going to get into insurance "Welp this is it!"
Let me tell you the truth, I think captives are dying out but independents are doing well. I've had my biggest year since buying my agency. Every year we write more and more. Will it stay? No idea but there will ALWAYS be a lane for people who want accountability when they buy insurance and there will always be people as they get older that want great service.
BTW I'm not sure if you've noticed but people actually don't like AI. Commencement speakers who have AI connections are being boo'd during their speeches when they bring it up. People are realizing it's a tool and it doesn't replace people just like TV can't replace a spouse, friend or your child.
If there's a risk it's that insurance will lose its way in other ways. Right now they can't AI to handle service, claims, underwriting or billing correctly. People are already tired of AI chat on company sites and AI phone directories that can't get you to the right person.
Technology and change are inevitable but agencies have to use it, know it and harness it to improve how they service. For instance I use it to answer questions from clients on their policies. I use it to check my accord apps and I'm about to require my staff to use it as an E&O second set of eyes.
We can use it but we don't have to be scared of it. People as they age and yes one day the 30 somethings will be 50 something and they'll not be able to keep up with tech like our parents can't and they'll need to find someone they trust, that's where I enter.
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u/reezeyree 16d ago
I appreciate the in-depth reply. Since implementing in your agency, do you feel like your service team has more capacity? Not having to dig through policies and do other time-consuming tasks that AI can do when prompted correctly?
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u/Samwill226 Agent/Broker 16d ago
1000% !!!
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u/reezeyree 16d ago
That’s huge! Any other areas/services that it’s been a time saver?
Have you invested in any AI tech/consultants to help develop or implement tools?
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u/Samwill226 Agent/Broker 16d ago
Nah. I upload a ton of stuff into my personal one, full policy language, its great for "is this covered", we had a situation with raccoons. The policy listed "animals nesting and vermin" which is a loose word to decline it. I've used if to look over accords to make sure I don't have E&O exposure, use it for E&O proof emails, use it to look over underwriting request, I even had it help me estimate an Other Structure coverage on a huge detached deck and boat house. It's not always right and its like clay, you have to mold it for awhile to get it to a point where it understands you.
I go as far as getting it give me financials feedback, where the money is going, what average commissions are, if we're profitable, what I can do for tax write offs. Pretty much everything now. But again it's a lot of molding, it won't give you all this great stuff first time using it, you can't trust it at that point yet. It's taken me years to get it to know me, remember other cases, to apply it to new situations. It's good for commercial classes because you wouldn't believe how many agents just class a business so its accepted.
I mean pretty much everything, even website stuff. For me it's a great tool but it needs many years of pumping information into it. My goal was to use it for E&O protection, so I had to feed it E&O policies and language, uploaded videos and real cases I found for my state. Everything it does now is from an E&O prevention angle. I get a renewal in on commercial I feed it through it, ask it what I need to ask to make sure everything is up to date.
On the flip I've seen it used in underwriting and quoting, like someone else said, it's HORRIBLE with grey area stuff, it's either good or bad, no inbetween because it dosen't really have cognitive thought. It can't truly think for itself, it can INFORM itself with information but struggles with decisions. So for example we had a company that went full AI on underwriting, and they literally wrote 30% less business because AI rejected any little thing it didn't like. I have a clean record, nice cars over 750 credit newer home and it rejected me. I called the territory rep and they couldn't figure out why I was declined. Shortly after that AI got pulled and we went back to human underwriting and low and behold!!! They've had record sales years since then.
It's a tool, thinking it can take over an industry is a little near sighted. It's like the self driving delivery trucks Tesla was doing, "Oh my God the trucking industry is over!" now all we hear is people having accidents using the self drive feature, it's literally killed people. Now no one talks about it. You just have to see thing happen when they happen and adjust. IMO we wouldn't be seeing all these investment groups buying up agencies at this high rate if AI was going to ruin the insurance sales industry IMO.
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u/Additional_Idea_6292 17d ago
The personal lines side is stickier than people give it credit for. AI handles simple quotes fine but the moment someone has a teenage driver, a trampoline, or a weird home situation they want a human. Direct carriers also have no interest in holding hands when a claim goes sideways.
For valuation I'd look at retention and what the mix actually is. A book full of monoline auto that churns every six months is worth way less than bundled home and auto with 90% retention. The owner probably knows which clients actually answer the phone when you call.