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On July 10 2026, a life insurance company called TruStage had a "cybersecurity incident". According to an update posted five days later, when they revealed the incident, they are "continuing to work carefully and urgently to understand the facts, and the company will communicate appropriately as its understanding of the situation evolves."
This work, according to their outage page (last updated on September 11th, at the time of this writing), is continuing. Every major business function is listed as "partially available". They have some text explaining that they can't simply turn the system back on, because safety.
They don't know what data was compromised. They don't know when they'll have everything back up. As of mid-August they had gotten so far as setting up a "clean" environment that they could start migrating services to. The only good news is that some of their services are supplied to credit unions for banking, and those were on different systems, so only their insurance packages were compromised. I also suspect the fact that they serve credit unions is the only thing keeping the business afloat, because failing to handle transactions for months seems like a terminal event for most businesses.
Obviously, this also means they're embroiled in an ever growing number of lawsuits from a variety of parties. It also highlights something about how insurance works: it's middlemen all the way down.
TruStage will issue policies, but their connection to the actual policy holder will likely be routed through a number of different partners. Like, for example, Ethos.
Ethos uses "AI" to "democratize" insurance. Feed your data into their AI, and in minutes they'll pair you up with a policy. Which, while using machine learning to do things like assess insurance risk seems like a pretty reasonable idea, in this age of AI hype, one has to wonder how this actually is implemented and how it works in practice.
But Ethos isn't the end of the chain! Other companies live downstream from Ethos, for example, Family First Life. A customer might reach out to FFL to get a policy, FFL reaches out to Ethos (or one of many other partners), and Ethos reaches out to one of its partners (TruStage being one of their largest), and boom: an insurance happens. Like I said, it's middlemen all the way down.
But now, here's the problem: TruStage issued a bunch of policies, and then stopped being able to do business. They stopped being able to do even vital things, like process payments. And you know what happens when payments aren't made on a life insurance policy? It lapses. It goes away. You no longer have insurance. And the agents who sell those policies are often paid a commission based on the value of the first few months of the policy's life (since life insurance is expected to be a long term investment). If the policy lapses, those commissions vanish, companies like Ethos (or downstream partners like FFL) get chargebacks on the value of those failed policies.
This makes some people, like FFL's President, Shawn Meaike, very unhappy.
What we have here is a pretty egregious failure of cybersecurity and disaster recovery on the part of TruStage. It's an embarrassing and potentially terminal event for them. It's awful for the customers who bought insurance policies to give themselves peace of mind, only to discover their policies lapse because TruStage can't take their money. It's creating mild chaos in the entire industry. That's all interesting, but not why I wanted to write an article about this. I wanted to write about the incredible cringe.
In this clip from an insurance industry conference, Meaike brings up all of their partners for a "carrier panel". He then proceeds to line them up from stage right to stage left, ranking them as "weakest" to "strongest". Ethos, who sells TruStage policies, is labeled as the weakest.
"You have the weakest leg," he says, pointing at the reps from Ethos, to laughter from the audience, and then indicates the other side of the line represents "the strongest leg." Meaike hands the microphone to an Ethos employee, Dylan Cummings, "We'll start with you."
"I want to start out by thanking everyone," Cummings says.
Meaike cuts him off. "Hey, hey, hey, hey. I'm gonna help you. Why don't you start by saying you're sorry."
The crowd yells out, "Yes!" and applauds this idea.
"Say 'We have a carrier that's shut down'," Meakie continues, "'and I'm mother-freaking sorry.'"
Yes, he said "mother-freaking", on stage.
So let's recap. An insurance company gets pwned so hard they can't run operations for months. People's policies lapse, simply because they can't give their money to the insurance company. Which 100% sucks for those customers, though at least with life insurance we expect very few of them are missing their payout- hopefully! This chain cascades through the network of partners, until it culminates in the president of one company publicly humiliating the senior account manager at a middleman company, during an industry conference.
Nobody comes off looking particularly good here, obviously. Meakie is a jerk. TruStage is institutionally incompetent. Ethos is in a bit of a rock-and-a-hard-place situation, and Cummings is trying to do his best to tap dance his way out of oblivion, but it seems like the AI driven insurance startup just isn't a good partner even before their main issuer died.
All in all, it feels like a Tim Robinson sketch, or perhaps a Nathan Fielder bit. We're one step away from Meakie calling Cummings a "Wizard of Loneliness."
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