Since I started publishing my series on AI Transformation, where I present the point of view of an insurance CTO, I have had many people ask me why the CTO is a female, or comment that it was unusual.

Sometimes you learn a lot by what questions people ask.

Everybody knows that the insurance industry has a ways to go in terms of diversity in a lot of respects. But the fact that this has come up so often is very interesting to me, because it has nothing to do with the message of the articles. I just decided to use a female as the protagonist.

Of course, this could also be a reflection on the technology profession as well.

As a white hispanic male in this industry without an obviously hispanic name and no hispanic “accent” (heck, I don’t even speak Spanish well), I haven’t personally experienced overt discrimination, but I have seen it around me. Most of of it is unintentional, but the subtle challenges of being an “other” in this industry is a real thing.

Even if you set aside the fundamental questions of fairness and equality, the insurance industry is not well served by any bias that limits its access to talent regardless of gender, race, color, or cultural background. Especially now, when the industry must adapt to many disruptive forces and replace a generation of retiring professionals.

The stock market can sometimes overreact or be fickle. The recent sector wide multiple compression for SaaS stocks is notable considering they were the darlings for quite a while.

I understood the rationale at an intellectual level, but a recent experience made me realize first hand what these companies are dealing with.

Take Hubspot for example. Great company, great product. In the past when I have moved from the company side to an independent advisor or during a job search, it was very easy to spin up HubSpot to use as my personal CRM to manage all the outreach and opportunities in an organized way.

This time, I just used a project in Claude co-work, and within half a day I had a system in place that far exceeded the capability and usefulness of HubSpot for what I want to do. And I’m sure it will continue to evolve more to support my business development activities.

I just started with a simple prompt and took it from there. Now I can add contacts, companies, and rich data about every entity. Claude keep track of my opportunities, gives me a morning brief every day, and interacts with my email and calendar.

All of this is basic stuff, but the difference is that Claude is actively helping me add context and make connections within my network, and I can interact with it in ways that are more natural and satisfying than maintaining something that was designed to meet an entire market’s needs, not my specific needs or preferences.

Granted, this is a corner case, and not an enterprise implementation. But I think the issue extends to enterprise decisions. If you had asked me 3 years ago if a new MGA should build a proprietary stack or just buy something off the shelf I would have confidently advised the latter. Now I think the obvious answer is to build, if your team has the ability to.

These SaaS giants aren’t going to just sit back and let themselves become obsolete. They have a huge customer base and many are deeply integrated into their customers’ overall tech stack and users. They have the resources to respond and evolve.

But the multiple compression reflects the reality that they are now in competition with foundation models which are rapidly evolving and operate on a different plane. Pricing models and costs will have to adapt, and enterprise customers are no longer going to feel that a third-party SaaS is the only viable option.

Sam Lessin, of Slow Ventures and one of my favorite podcasts, “More or Less”, vibe coded a simple website that shows the prices of tokens from various models.

When I first saw the wide variation in token prices I was surprised. But I am curious as to what to conclude.

Open AI and Anthropic are the premium priced tokens, although competition between the two leaders may drive that down. (WSJ/Paywall)

In comparison, Xai is dirt cheap. Is it a bargain alternative or is it (as I suspect) the market signaling its lack of value. I’ve never used Grok so I can’t offer a first hand opinion.

Google is interesting. Gemini is a powerful LLM with a lot of usage (although it’s hard to compare apples to apples with Google’s embedded AI in search and Google Apps.). Google has deep pockets so their mid-range pricing might be a very intentional positioning to gain share with developers.

In any case, the cost of tokens and the future ramifications for Insurance Enterprises is something I think is not broadly understood in the C-Suite. I’ll be writing more on that topic in the future.

Douglas Ver Mulm notes “Corgi is bad for all the great tech-forward and Insurtech MGAs/wholesalers/carriers out there”

Alexander Niehenke notes “If momentum investing and stupidity had a bastard child, it would be vibe investing”

Corgi’s job posting for Chief of Staff, Trucking Insurance, says:

“The $40B+ trucking insurance market is still being underwritten by people with paper files and 1990s rating engines. We're going to fix that.”

Well, Progressive has 50% market share in trucking and you can get a binding quote online here. Also check out Cover Whale, Nirvana, even GEICO

Also from the job posting:

“In year one, expect to help build a division from scratch to $1B in premium”

To be fair, if you underprice the product in a highly price sensitive, non-loyal, high churn segment, you can definitely grow fast!

The losses will likely be spectacular, and while RRGs enable high capital leverage, that leverage works against you when the losses are high, wiping out the surplus capital. And with no state backstop, it can easily end in tears.