First off, I am new to podcasting. So while I should have posted this weeks ago every time I start on that effort I realize all the things I am not doing right and then I put it off. I decided to just publish it where it is at this time because I think the content is really good and I can figure out the rest as I go along.
I believe that of the various parts of the insurance value chain retail brokerage is the most ripe for AI transformation, followed by MGAs, carriers, then reinsurers. My logic on that will be the subject of a future post.
Jason Keck, the CEO of Broker Buddha, has been working in this space for quite a while. Jason and I go back to my SiriusPoint days, when we led Broker Buddha’s Series A and I sat on the board. I have no financial interest in the company anymore, which makes this an easy conversation to have and a harder one to fake enthusiasm for. I didn’t have to. Here are five reasons to watch.
The Last Deal Before the Rug Pull [02:04]
Broker Buddha closed its round in the spring of 2022, which may make it the last InsurTech funded before rates rose and the capital disappeared. Jason describes what it feels like to finally hit your stride with large agencies at the exact moment those agencies freeze their budgets for the rest of the year.
One Founder, Three Jobs [05:18]
About a year ago Jason started doing business vision, product management, and software development himself, with AI doing the parts he was less comfortable with. He is candid about what that “compression of roles” means for people’s jobs. I take it one step further: if you are a CTO at a carrier today, your organization is built for how technology worked three years ago. You can jam AI into the old process, or you can walk into the boardroom and say everything I told you last year no longer applies.
The AMS Is Where You Store the Work, Not Where You Do It [11:05]
Every agency in the country runs on Applied Epic, AMS360, HawkSoft or the like, and every one of them actually does the work in Outlook. When I was at Patriot I would sit down with a CSR and ask how they knew what to work on next. The answer was a task list and a very good memory. Jason walks through what Broker Buddha AI does about it: applications, loss runs, and market submissions in one system, wrapped in a CRM so you can finally see a placement move through a pipeline instead of guessing.
Retail Is Where It Happens [16:45]
Carrier people (I was one) tend to see retail brokerage as the end of the pipe. It is the beginning. It is where the customer is acquired, by people who are hired and paid for their ability to build trust, not to run operations. That is exactly why the opportunity is so large: agencies already earn EBITDA margins in the 25 to 35 percent range with almost no operational leverage applied. Jason’s pitch is that the right technology lets an agency grow revenue and expand margin at the same time. I think he is right, and I think it is the most direct line from technology dollars to returns anywhere in the value chain.
Why Does the Risk-Taker Earn Less Than the Salesman? [19:19]
We end on the question I couldn’t stop asking. AI will not kill the retail agent, because nobody loves buying insurance and most would rather have another person do it. But if broker margins keep climbing while carriers earn single-digit risk-adjusted returns and trade at book value, how long can that equilibrium last? Jason’s brother is a producer at Hub, and his story about whether AI would take his job is the right way to think about it.
