Florida Agents Optimistic About Market – and Don’t Fear the A.I. Reaper

ORLANDO – Just as some California insurance agents are expressing grave concerns about the future of that state’s insurance market, a number of Florida agents feel like they’ve turned something of a corner.

“Things are getting better. They are,” said Gordon Gillespie, owner of Great Florida Insurance, an independent agency in Port Orange.

Gillespie was one hundreds of agents at the Florida Association of Insurance Agents annual convention in Orlando last week. Many said that while issues remain with some carriers on commissions and underpaid claims, the Florida Legislature’s recent litigation reform measures have nudged the market back in the right direction, and should soon lead to new carriers and more-affordable coverage in the state.

Even a session on the intricacies of the state-created Citizens Property Insurance Corp. featured far fewer complaints from agents than did the same session at last year’s conference.

“There’s some optimism now. I’m getting positive feedback,” Kyle Ulrich, president and CEO of the FAIA, said at the end of the three-day convention.

“The reforms were very meaningful. We’re starting to see new capital come into the state, and will see more by the end of the year, I believe,” said Peter Corrigan, president of Auto Club South Insurance Co. He spoke at a panel discussion at the FAIA conference’s general session on Friday.

The brewing optimism stands in sharp contrast to the feelings expressed in and after a California webinar last week with that state’s insurance commissioner, Ricardo Lara. The American Agents Alliance warned of a crisis facing the Golden State and vented frustration that carriers can’t seem to raise rates more than 6.9% a year. Those limits, in the face of mounting losses from wildfires, has contributed to State Farm, Allstate and other carriers placing a pause on writing new business in California.

In Florida, where agents and carriers have walked through the coals of their own insurance crisis in the last three years, the growing sense of confidence also applies to the perceived impact of artificial intelligence on the industry.

News and industry reports have shown that carriers and agencies are increasingly utilizing AI and machine learning for a wide range of needs, from quotes to underwriting to claims management. Data Bridge Market Research has reported that the value of AI in the global insurance industry is expected to increase 10-fold by 2030. A December 2022 report by the National Association of Insurance Commissioners found that 88% of insurance companies surveyed plan to use or consider using AI.

But several people at the FAIA convention poo-poohed concerns that AI will replace agents and agencies anytime soon. The conference did not host an education session or discussion on artificial intelligence.

“Not in Florida. Florida’s too complicated for AI,” said Brian Chapman, owner of Chapman Insurance Group, one of the largest agencies in southwest Florida.

He and others said the state will always need well-versed agents who know how to write vulnerable properties in a hard market, especially one that is seeing a growing number of endorsements, exclusions and higher deductibles.

“No where else in this country is an independent agent needed more than in Florida,” Corrigan said. “We keep hearing that AI is going to take the place of the agent. It’s not happening in Florida. Not in our lifetime.”

“Call it job security,” said Jeff Grady, a former FAIA president, now business development manager for Independent Market Solutions.

Photo: FAIA’s general session panel discussion, June 16. From left: Kyle Ulrich, FAIA president and CEO; Jeff Grady, former president; Peter Corrigan of Auto Club South Insurance; and Steve Weinstein, chair of the Bermuda Institute of Ocean Sciences. (IJ photo)

Topics California Florida Agencies