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Friday File: AI in One of Our Favorite Sectors?

A new buy in the Real Money Portfolio

By Travis Johnson, Stock Gumshoe, September 20, 2024



This is going to drive some of you a little batty, so I apologize in advance.

I’m talking about insurance. Again.

Why, you say? Well, partly it’s that I can’t help myself… and partly it’s that when someone dangles a puzzle in front of my face, I have a really hard time resisting the urge to solve that puzzle.

So… remember when I wrote about Porter Stansberry’s most recent Property & Casualty insurance company recommendation earlier this week? That was Kinsale Capital, in case that helps to ring the bell, one of my favorites over the past couple years.

Well, as part of that free daily email, Porter dangled a little sales pitch in the form of a tease along the lines of, “we’re gonna invest in a new property & casualty insurance company soon, sign up to learn what it will be!”

And dammit, on Wednesday Porter started dropping more hints about the stock, which he apparently hasn’t recommended yet but is planning to. And I can’t just ignore that, I gots to know what it is. That compulsion has kept me sifting through these teaser ads and trying to shine light on the investing world for more than 20 years, so no surprise.

But yes, today we’re looking into another tease for an insurance stock. Ready?

Stansberry pitches this as a company using AI to make insurance better… here’s a little bit of his spiel from Porter’s Daily Journal on Wednesday:

“… while insurance is likely the last industry you would expect to be the beneficiary of the breakthroughs in augmented intelligence and large language models… that makes it the Big Secret on Wall Street.

“… well-run insurers are among the most effective vehicles for building lasting wealth. Just consider the long term performance of companies like Progressive, Travelers, and United Health Group.

“But now, with the emergence of augmented intelligence, I believe insurance firms are going to enter a whole new era of profitability.

“You see, using the vast analytical power of AI, insurance companies can now automate and personalize individual policies and deliver precise estimates based on someone’s risk profile and past behaviors….

“This kind of personalization will save both the policyholder and the insurer large sums of money, an estimated $4.4 trillion according to McKinsey Global.

“AI will also help eliminate the ...

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