The global insurance intermediary industry is facing a severe challenge from the rise of artificial intelligence. On February 9, the S&P 500 Insurance Index fell over 3% in a single day, marking its largest decline since October 2025. Shares of numerous established insurance brokerage giants plummeted, with losses ranging from 7% to 12%.
This sharp decline was triggered by OpenAI's approval of the first batch of insurance applications based on its ChatGPT technology. These include a car insurance comparison tool launched by the US online platform Insurify and a home insurance quoting application developed by Spanish insurer Tuio. This development signifies that AI technology is now directly impacting the core distribution channels of the insurance sector.
The immediate cause for the collective plunge in share prices of global insurance brokerage leaders is the disintermediation threat posed by the implementation of AI technology in insurance, which strikes at the very foundation of the traditional intermediary business model.
On February 9, leading US online insurance platform Insurify released an AI-powered comparison tool based on ChatGPT, touted as the first insurance application in OpenAI's directory. It integrates a database of over 196 million car insurance quotes and 70,000 verified customer reviews with ChatGPT's conversational interface, transforming the traditional car insurance purchasing process. Users no longer need to rely on intermediaries; they can simply state their needs in plain language to receive personalized premium estimates based on their driving history, vehicle type, and age. The tool also allows for direct comparison of prices, services, and coverage from multiple insurers, enabling users to complete the entire car insurance selection process independently, bypassing intermediaries entirely.
Simultaneously approved was a home contents insurance quoting tool developed by Spanish digital insurer Tuio. Furthermore, OpenAI's revelation that dozens of other AI insurance applications are under review and nearing launch has made the market realize that the AI-led disruption of insurance intermediary services is only just beginning.
This panic was directly reflected in the severe performance of US insurance brokerage stocks. On the 9th, Willis Towers Watson plummeted 12.10%, its worst single-day performance since the 2008 financial crisis, leading the sector's decline. Arthur J. Gallagher & Co. fell 9.85%, Aon dropped 9.27%, and other leading firms like Marsh & McLennan saw declines of around 7%. No company in the US insurance brokerage sector was spared, resulting in a collective sharp downturn.
The panic in capital markets is highly contagious and predictive. The sell-off in US stocks quickly spread to the European insurance market. On February 10, European insurance stocks fell collectively, with leading companies like Hiscox, Mapfre, Aviva, and AXA experiencing share price declines between 2% and 3%.
Subsequently, the US wealth management sector also experienced significant declines. Financial software provider Altruist Corp. introduced an AI tool for tax strategy planning, capable of helping financial advisors create personalized strategies for clients and generate pay stubs, account statements, and other documents, directly targeting the core business of traditional wealth management firms. Charles Schwab fell over 9% during trading, while Raymond James Financial and LPL Financial Holdings also saw substantial drops.
This reflects the capital market's judgment: all traditional financial intermediary models reliant on information asymmetry and basic services are becoming targets for AI disruption. Insurance intermediaries are just the beginning, but they will certainly not be the last.
More alarmingly for the industry, these newly launched AI insurance applications are fundamentally different from previous digital tools in the sector. Past online policy purchases and claims inquiries were merely digitized versions of offline services; they did not alter the intermediary's role as the core link between supply and demand. In contrast, ChatGPT-powered insurance applications achieve intelligent and autonomous service, truly enabling 'disintermediation.' Users without any specialized insurance knowledge can complete the entire process from needs matching to product comparison. This means the information barrier, upon which insurance intermediaries depend for survival, is being completely shattered by AI, striking at the very core of the intermediary business model.
The sell-off of insurance brokerage stocks by the capital market fundamentally questions the survival value of traditional intermediaries. For a long time, the profitability of the insurance brokerage industry has been built on information asymmetry: ordinary consumers lack insurance expertise and cannot accurately match their needs with suitable products. Insurers rely on intermediaries to reach a broader customer base, while intermediaries profit from this information gap through commissions, acting as the essential bridge between supply and demand.
However, the emergence of AI has彻底 disrupted this balance. Insurify's car insurance comparison tool, with its massive data and intelligent matching capabilities, allows consumers to independently compare products and match them to their needs. This implies that the fundamental service value of insurance intermediaries is almost entirely eroded in the face of AI. The market's 'sell first, ask questions later' approach essentially reflects that the survival foundation of traditional intermediaries has been shaken, and their raison d'être is rapidly diminishing.
Compounding this crisis is the underlying weakness within the insurance brokerage industry itself. Financial reports for the fourth quarter of 2025 show that leading brokerage firms like Marsh & McLennan, Aon, and Arthur J. Gallagher & Co. are experiencing continued slowing revenue growth, indicating exhausted growth momentum for the sector. Simultaneously, persistently soft pricing in the property and casualty insurance market is directly compressing profit margins for brokers. Against this backdrop of an already struggling traditional growth model, the impact of AI delivers a potentially fatal blow to an industry already on the brink.
Some market voices argue that current AI insurance applications focus only on standardized retail lines like car and home insurance, suggesting that complex commercial insurance still requires professional brokers, and thus AI is merely an 'efficiency amplifier,' not an 'existential threat.' This view, however, likely underestimates both the rapid evolution of AI and its potential for industry penetration.
Standardized retail business constitutes the foundation of the insurance intermediary industry and is the primary source of income for the vast majority of intermediaries and frontline agents. The loss of this business segment could plunge many intermediaries into severe operational difficulties and significantly reduce the livelihood of frontline practitioners. More alarmingly, the pace of AI advancement is far faster than anticipated. While current AI may not handle complex insurance transactions, some enterprise-level AI products already demonstrate powerful customization capabilities and can automate workflows across multiple domains. With ongoing technological iteration, AI's penetration into complex insurance business is only a matter of time.
Even conceding that AI might not fully replace commercial insurance intermediaries immediately, it is sufficient to greatly diminish their service value. AI can independently perform basic risk analysis, data organization, and preliminary plan drafting, leaving intermediaries to handle only subsequent refinement work. This will significantly weaken both their commission potential and their standing within the industry.
Perhaps most worryingly, the traditional insurance intermediary industry appears unprepared for this crisis. For years, the industry has remained comfortably reliant on profits from information asymmetry, lacking both the impetus and the capability for deep digital transformation. When the AI disruption arrived suddenly, most firms found themselves without adequate technical reserves or a clear strategic direction for transformation, forcing them into a passive, reactive stance.
From an industry-wide perspective, no effective counter-strategy has yet emerged. Both intermediary firms and individual practitioners seem preoccupied with debating 'whether AI will replace them' rather than proactively exploring 'how to find new value and purpose in the AI era.' This state of passive uncertainty risks allowing the industry to sink deeper into crisis.