2026 State of the Industry Report

The Insurance Industry Reaches an Adoption Tipping Point

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About the Report 

In March 2026, First Connect surveyed 238 independent agents and 44 carrier and MGA partners to build our second annual State of the Industry Report. With two years of data, we can now track real trends: what's improving, what's stalling, and where the industry is heading.

This year's findings reveal not only the challenges shaping the market today but the concrete progress being made across key carrier-agent partnership metrics, including a 50% drop in quote speed challenges, a 53% decline in appetite clarity issues, and a widening gap between AI optimism and adoption.

Key Takeaways

The report reveals 4 critical insights that are defining the future of insurance distribution.

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Friction is Finally Falling

Agent-reported challenges dropped across every metric, with quote speed issues falling by half and appetite clarity challenges down 53% YOY.

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Customer Expectations Keep Rising

77% of agents report increased client expectations for quote and binding speed, and direct-to-consumer competition is now the single biggest pressure on the agent channel. 

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Carriers Lack Full Competitive Visibility

75% of carriers don't use third-party intelligence platforms to evaluate competitive positioning, yet most rate their market understanding as excellent. Real growth depends on understanding what happens outside their book.

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AI Adoption Gap

Only 35% of agencies use AI in day-to-day operations, despite 53% expressing optimism about its impact. The tools to win already exist. The 2026 opportunity is about operationalizing them.

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