Why This MGU Keeps AI Out of Underwriting

Introduction

What does it take to launch an insurance product that did not previously exist, get it live in twelve states in under five months, and run it with a deliberately small team? Vital Coverage Insurance Services did exactly that, and in this episode Josh Hollander brings both sides of the build into the same conversation.

Arvind Kaushal, Co-Founder and CEO of Cogitate, and Justin Krone, COO of Vital Coverage Insurance Services, join Josh for a rare three-way conversation on the show. They cover why Justin left a twenty-year carrier career to run an MGU, why Arvind tells founders to underwrite their technology partner the way they would underwrite a risk, and where each of them draws the line on AI in an underwriting workflow. They do not fully agree on that last one, which is the most useful part of the discussion.

Guests

Arvind Kaushal co-founded Cogitate in 2012 and leads the company as CEO. He came to insurance software from the operator side. Before founding Cogitate he was CFO and CIO at Insurance House, which meant, in his words, that he was signing the checks and responsible for the systems at the same time. The first version of what became the DigitalEdge platform was not a product, it was a fix for his own company's broken workflows. Earlier in his career he spent eight years at Delta Air Lines, including work as an architect on Delta.com, and started out at Wipro in Mumbai.

Justin Krone spent twenty years at CNA Insurance, the last ten running small business and small commercial strategy, before becoming COO of Vital Coverage Insurance Services. Vital is a lean, single-product MGU selling a first-of-its-kind business continuity coverage for small medical practices, protecting physician, dental, and veterinary offices against the loss of a key practitioner. The program launched across twelve states in under five months and is now live in seventeen.

Key Topics

-Underwrite your partner. Arvind's rule for choosing a technology vendor is to run the same diligence on the partner that you would run on a risk, because every provider in the market will tell you they can do everything.

-Principles over capabilities. Justin has seen most of the policy administration platforms on the market, and argues the deciding factor was not the feature comparison but whether the two organizations approached problems the same way.

-The lean MGU thesis. Vital was designed so that a tenfold jump in quote volume would not require materially more staff, and