AI for independent insurance agencies: what to build

AI for independent insurance agencies works best on one kind of task: reading and comparing documents the agency already holds. That means checking the issued policy against the binder, quote, and expiring term, building the renewal comparison, pre-filling a submission from last year's application and loss runs, and drafting the note that tells the insured what changed, with a licensed account manager deciding what each difference means and signing off.

Those are the tasks an account manager returns to on every new policy and every renewal, and they are the same tasks E&O loss control guidance asks agencies to do carefully. The rest of this article covers what agencies are doing today, what the regulatory position is for an agency as opposed to a carrier, and how to build each workflow so it adds to the file documentation.

What are agencies using AI for today?

The Big I's 2026 Agency Universe Study found that 46% of agencies report using AI, up from 15% in 2024, with marketing content generation (49%), coverage form analysis (43%), and contract reviews (35%) as the named uses. The same release lists the top barriers as lack of knowledge about capability (60%) and security and privacy (48%).

Regular use is less common. The Big I's Agents Council for Technology reports that 68% of agencies plan to increase AI use in the next 12 months, about 8% use it regularly and strategically, and 56% have no written AI policy or guidance. A trade press summary of the same report says 45% use ChatGPT or other public large language models and 20% use policy comparison tools.

Consumers in the study wanted both the agent and the technology. IA Magazine's summary of the study reports that 87% of consumers say having a human insurance agent remains important, and 61% say they are more likely to choose an agent who uses AI and other modern technology.

Does the NAIC AI bulletin apply to an agency?

The NAIC model bulletin on the use of AI systems by insurers, adopted December 4, 2023, is addressed to "All Insurers Licensed to Do Business" in the adopting state, and its opening paragraph speaks to insurers that hold certificates of authority. It expects each insurer to develop, implement, and maintain a written program for the responsible use of AI systems that make or support decisions related to regulated insurance practices. The model text does not name agencies or producers.

The part an agency should read closely is the section on third parties. The bulletin defines a third party as an organization other than the insurer that provides services, data, or other resources related to AI. It asks insurers to perform due diligence on those parties and, where appropriate, to include contract terms that give audit rights and require cooperation with regulatory inquiries. The section is written about the AI systems and data an insurer acquires from outside parties, and the model text does not say how it applies to an agency's own use of AI. If a carrier you represent asks how your agency uses AI on its business, this section is the likely source of the question, so ask your carriers what they expect.

Each state issues its own version. The NAIC's implementation map, with status as of April 1, 2026, lists 25 jurisdictions that have adopted the bulletin and four more states with their own insurance-specific regulation or guidance, and the NAIC notes that the map does not determine whether a state's version contains every element of the model. Confirm the position in each state where you are licensed with the department or your counsel, and ask your E&O carrier what it expects. Other privacy and data security laws may apply to an agency directly, and those are also a question for counsel.

Which agency work fits AI best?

The work that fits is document comparison, because the agency already has every input and the answer can be checked against a page. The table shows the main candidates.

Workflow	Documents it reads	What it drafts	What the account manager decides
Policy check	Issued policy, binder, quote or proposal, expiring policy	A list of differences, each with page and form number	Whether each difference is an error, an accepted change, or something to raise with the carrier
Renewal comparison	Renewal quote or policy, expiring policy, current schedules	A side-by-side comparison and a draft note to the insured about what changed	What to recommend and what the note says
Submission	Prior application, schedules, loss runs, notes from the renewal conversation	Pre-filled ACORD applications and a list of fields that need confirming	Every answer on the application, confirmed with the insured
Certificates and contracts	The insured's contract, the policy and its endorsements	A list of insurance requirements in the contract and where the policy does or does not respond	What can be certified and what needs an endorsement request

Policy checking

A policy check compares the issued policy with what was bound and quoted, and with the expiring term. A useful output is a discrepancy list covering named insureds, locations, limits, deductibles, the forms schedule, and endorsements, where each line says what differs and where to find it. The account manager works through the list and clears each line.

Renewal comparisons and the note about what changed

The renewal comparison uses the same method on a different pair of documents. The draft note to the insured should state changes in plain terms and avoid characterizing the coverage as a whole. Utica National's loss control guidance tells agents to avoid language such as "apples to apples," "comprehensive," or "fully covered", and that instruction belongs in the workflow's written rules.

Submissions

For a submission, the workflow reads the prior application, the schedules, and the loss runs, fills in what carries over, and flags every field it could not support from a document. The insured still confirms and signs the completed application.

Certificates and contract review

Contract review means reading the insurance requirements in the insured's lease or services agreement and setting them beside the policy. The output is a list of requirements with a reference to the form that responds to each, or a note that nothing does. The account manager decides what the agency can certify.

How do you build it so it supports your E&O documentation?

In the same article, Utica National describes failure to obtain or maintain proper coverage claims as arising when a claim is submitted and the policyholder discovers they do not have the coverage they expected. Its recommendations include using checklists, reviewing the current policy carefully when changing carriers and pointing out any coverage differences to the client, keeping signed and fully completed applications, and backing up verbal communications in writing. Each workflow above produces a draft of one of those documents. Whether the draft is useful in the file depends on three build details.

1. Every difference cites its source. The output gives the page and form number for each item, so the reviewer can open the document and confirm it without rereading the whole policy.
2. The comparison follows the agency's own checklist. Write a checklist for each line of business and have the workflow report against it, including the items where it found nothing. A general summary will miss what your agency considers essential on a given line.
3. A named reviewer signs off. Nothing goes to the insured or the carrier until a licensed person has reviewed it, and the file records who and when. Our article on designing the human review step covers how to make that review real instead of a click.

A workflow built without those three details produces a summary that nobody has checked against the policy, and that is not something to put in the file or send to an insured. None of this changes the agency's E&O position on its own, so ask your E&O carrier how it views AI-assisted policy checking before you rely on it.

Where does insured data sit, and who owns the workflow?

These workflows can run inside the agency's own AI workspace, against files exported from the agency management system. The checklists and written instructions sit in the agency's account, and the agency owns them. We package those instructions as skills, which we explain in what Claude skills are.

Read the vendor's terms for the plan you are buying. Anthropic, for example, states that by default it will not use inputs or outputs from its commercial products, such as Claude for Work and the Anthropic API, to train its models, with an exception when a user reports feedback or otherwise chooses to allow it. Terms differ by vendor and by plan, so settle the question in writing before client documents go in. Our guides to secure AI workflows for confidential client data and writing an AI acceptable use policy go further, and the Big I's ACT lists a sample AI policy and AI legal issues resource for its members.

Where should an agency start, and what should it leave alone?

Start with the policy check on one line of business where you already have a written checklist. Run it on last year's closed files first, because you know what the account manager found on those and can compare. When the discrepancy list matches what a careful reviewer would catch, use it on live policies with the sign-off step in place, then move to the renewal comparison.

Leave three things alone for now: anything that sends to an insured or a carrier without review, any use of AI to give coverage advice directly to clients, and any workflow you cannot explain to your E&O carrier in a paragraph. If you would like a senior person to build the first one alongside your account managers, you can get in touch.

Common questions

Can AI check an insurance policy for errors?

It can compare an issued policy with the binder, quote, and expiring policy and list the differences in limits, deductibles, forms, endorsements, and named insureds. It should cite the page and form number for each difference so a licensed account manager can verify it, decide whether it matters, and sign off.

Does the NAIC model bulletin on AI apply to independent agents?

The model bulletin is addressed to insurers licensed in the state and sets expectations for an insurer's written AI program, including how the insurer oversees third parties. It does not name agencies or producers, but states adopt their own versions and carriers may pass requirements along, so confirm with your state insurance department and your E&O carrier.

Will using AI increase my agency's E&O risk?

That depends on how the workflow is built and what your E&O carrier says about it. A comparison that cites its sources, follows the agency's checklist, and is reviewed by a named person supports the documentation habits that E&O loss control guidance recommends, while an unreviewed summary sent to an insured does the opposite. Ask your carrier before you rely on it.

Should my agency have a written AI policy?

Yes, and most agencies do not have one yet. The 2026 Big I ACT Tech Trends Report found 56% of agencies have no written AI policy or guidance, and ACT lists a sample AI policy among its resources for Big I members.

Do we need a policy-checking product or can we build this in our own AI workspace?

Either can work. A product gives you a finished interface, while a workflow built in the agency's own AI workspace runs on the agency's checklists and keeps the instructions and the insured's documents in an account the agency controls. The decision usually turns on volume, lines of business, and how specific your checklists are.