Artificial intelligence is transforming the insurance value chain in unprecedented ways. Amidst an era of rapid change, independent agencies are facing a pivotal question: how to stay relevant in a world where automation is absorbing routine tasks.
For firms like Powers Insurance and Risk Management, the answer lies not in competing with AI, but in leaning harder into what machines cannot replicate.
JD Powers (pictured), CEO of Powers Insurance and Risk Management, believes the distinction is already clear.
“The placement of insurance policies is the easiest part of what we do,” he said. “The real work is helping clients implement best practices and communicate their risk profile effectively to underwriters.”
Across the independent agency channel, leaders are reframing their value proposition around advisory depth, risk innovation, and client advocacy. While AI is expected to streamline policy placement, data analysis, and administrative workflows, agencies are positioning themselves as strategic partners focused on complex risk management.
Rather than viewing AI as an existential threat, many independent agencies see it as a force multiplier, particularly for well-trained professionals. Powers noted that AI’s greatest impact will likely be in reducing repetitive tasks and accelerating the development of junior talent.
“I think AI will help someone with adequate training operate more like a senior advisor,” he said. “But it won’t replace expertise. You still need to understand what you’re doing.”
This perspective is shaping hiring and training strategies. With an aging workforce and a shortage of new entrants, agencies are investing heavily in talent pipelines. Powers, for example, has built an internship program requiring students to obtain insurance licenses before joining, with the goal of elevating new hires’ baseline competency from day one.
“We’re speaking with college students, some in risk management degrees and others not, who happen to have some interest in insurance. We help them study and get their insurance license, and (if) they pass, they’re able to join the internship program and get extensive training from us,” Powers explained.
“We have such a shortage of young people coming into the industry, while we have droves of retirement-age people deciding to hang up the hat. It feels good to make that kind of investment not only in the organization, but in the industry.”
As AI commoditizes certain functions, independent agencies are differentiating themselves through innovation, particularly in risk management.
Powers has leaned into what it calls “real-time risk management,” combining traditional advisory expertise with technology such as telematics. While telematics is widely used in auto insurance, the firm has adapted it for construction clients, enabling safer job sites and better equipment oversight.
This type of proactive risk mitigation is becoming a hallmark of independent agencies. Rather than simply transferring risk, they are increasingly helping clients avoid it altogether.
This approach is part of the agency’s response to an increasingly challenging commercial insurance landscape. In recent years, carriers have struggled with unpredictable weather patterns, rising repair costs, and the impact of social inflation, including large liability verdicts.
According to Powers, clients’ most pressing concern in this environment has been affordability. Premium increases across property, auto, and liability lines have forced many businesses to rethink their risk financing strategies.
The CEO said independent agencies are responding by guiding clients toward alternative structures, including higher deductibles, self-insured retentions, and captives. These approaches allow businesses to retain more risk (and potentially capture underwriting profit) while aligning more closely with insurers.
“We’re seeing a big shift toward alternative risk transfer,” Powers said. “Insurance costs are stabilizing to where I don’t think they’re going to continue going up the way they have, but I don’t know that we’re going to see a huge drop either. We might be at a new norm. As long as businesses are really on top of managing their risk, they’re better off looking at alternatives and how they can retain more risk.”
Founded in 1991 by Pierce Powers, the agency began as a small, reputation-driven business centered on risk management expertise. Over time, that foundation has enabled the next generation – JD Powers and his siblings, Henry and Elizabeth – to transform it into a national player.
As the firm marks its 35th anniversary, its leadership is focused less on legacy and more on what comes next. While maintaining its family-driven culture, JD Powers aims to build a brand that stands on its own in markets across the United States.
“Being family-owned, or at least partially family-owned, is always going to be an identity for Powers. Elizabeth, Henry, and I have no motivation to retire anytime soon,” JD Powers said. “But there’s also a part of me that wants Powers to become something bigger than a family-owned agency and become a brand in its own right.”
