EHD, an independent insurance brokerage operating since 1896, evaluates every new technology investment against a single question: does it strengthen the relationships at the core of the business. Michael Malinowski (pictured), president and chief executive officer of EHD, said the firm's approach to digital transformation has accelerated since the COVID-19 pandemic, but the underlying philosophy has not changed.
“We're not in the business to buy the shiny new toy,” Malinowski said. “We're there to make sure it's effective for us and to help us with what we measure, revenue per employee, and how we can increase what our back-office folks can do to support customers while still maintaining relationships with existing clients and building relationships with new ones.”
EHD runs new technology purchases through what Malinowski calls its AI committee, a cross-functional group spanning claims, customer service and member care on the health insurance side, which evaluates prospective tools over a six-month process before any significant investment is made. The committee deliberately includes front-line staff alongside senior leadership.
“The group isn't just senior leadership, it also includes people on the front lines who deal with these tools every day and can give us solid recommendations on where to invest,” he said. He added that EHD also looks to other agencies that have already vetted a given platform rather than duplicating that diligence from scratch, particularly as technology costs continue climbing.
Malinowski said the clearest returns from AI and digital tools so far have come in policy checking, quote comparison, data analytics, renewals and information gathering, particularly when EHD takes over an account and needs to comb through old applications quickly. He described running legacy policy documents through a technology platform to surface useful detail for both new clients and existing ones that have since changed carriers.
Even so, Malinowski was clear about where he draws the line. “I'm an advocate of AI, but I never believe it's going to replace the relationship side of our business,” he said. “I just don't envision a business owner purchasing or making decisions purely on an AI platform.” He noted that many agency owners share that concern, and that AI's accuracy in insurance underwriting and claims technology applications still falls short of what clients ultimately need from a trusted advisor.
EHD's public sector client base, which includes municipalities across the Commonwealth of Pennsylvania, has historically been slow to invest in tools that protect personal and health information, according to Malinowski. He said cyber risk has been the turning point, with more governments now willing to fund training and reporting technology after seeing peers get hacked. “It's not a matter of if, it's when,” he tells clients, a message that aligns with broader coverage of cyber risk trends affecting public sector organizations.
He said social engineering remains one of the largest sources of claims among EHD's municipal clients, a problem he attributes largely to staff turnover and gaps in basic training rather than a lack of available technology. EHD encourages governments to master fundamentals such as claims reporting, workers' compensation incident tracking and safety committee suggestions before layering on more advanced tools.
As one of the larger privately held, independent brokers remaining in a market increasingly dominated by consolidators, Malinowski said EHD's transformation strategy depends on discipline rather than scale. He compared the approach to choosing a restaurant. “When you go to a restaurant with a 16-page menu, you're sometimes a little skeptical,” he said. “If the menu is one page, they're probably pretty good at what they do.”
That philosophy of focus over breadth, he said, has shaped EHD's broader approach to independent brokerage growth strategies and technology investment decisions as it works to remain privately owned. “Let's be really good at what we do, let's invest in the right things, and not overextend ourselves,” he said. “It really just comes down to the basics: do what you do, do it well, and work hard.”
