Is AI in HR Becoming a Liability for Your Clients?
ENGAGE PEO
By Ailene Dewar Costello
Artificial intelligence is rapidly changing how employers manage hiring, employee relations, performance management, and workforce planning. While these tools can help employers become more efficient, they can also create significant legal, compliance, and employee-relations concerns when used without proper oversight. For insurance brokers advising employer clients, questions around AI governance are becoming more common, especially as organizations adopt AI tools faster than policies and training can keep up.
Where Employers Are Running into Trouble
At Engage, our HR Consultants, all licensed attorneys with extensive labor and employment law experience, are actively advising employers on the evolving role of AI in the workplace. Through ongoing client conversations, we are seeing recurring concerns tied to compliance, employee relations, privacy, and risk management as organizations adopt AI tools into everyday HR functions.
Based on these conversations, several patterns are emerging as employers incorporate AI into HR operations. Common problem areas include:
- Unapproved use of public AI platforms: Employees may enter confidential business information, personnel details, compensation data, or internal strategy discussions into publicly available AI tools without understanding how that information may be retained or processed externally. Without clear internal guidance, organizations may unintentionally create cybersecurity, confidentiality, or record-retention concerns.
- Inconsistent manager use: Some managers use AI tools to draft performance documentation, corrective-action summaries, or employee communications, while others do not. Without review standards, this can create inconsistencies in tone, documentation quality, and decision-making practices across departments.
- Automated decision support without review protocols: AI-generated recommendations related to hiring, scheduling, productivity, or workforce reductions may appear objective while still relying on incomplete or historically biased data inputs. Employers that fail to document independent managerial review may have difficulty defending employment decisions later challenged by employees or regulators.
- AI transcription and meeting tools: Employees and managers may use AI-powered transcription or meeting-assistant tools during internal discussions, interviews, performance conversations, or workforce planning meetings without fully evaluating where recordings and transcripts are stored or who may access them later. Without clear usage standards and vendor review processes, organizations may unintentionally create confidentiality, cybersecurity, record-retention, or multistate compliance concerns tied to sensitive workplace discussions.
- AI-assisted employee communications: Managers may also use AI tools to draft disciplinary notices, performance feedback, restructuring announcements, or other sensitive employee communications to improve efficiency or consistency. Without established review protocols, organizations may create employee-relations risks tied to inaccurate messaging, inconsistent communication practices, or overly impersonal language during high-impact workplace interactions.
In most of these cases, the risk comes from overreliance on automation and the absence of experienced human judgment.
“AI can support HR functions, but it cannot replace experienced professional judgment.”
AI Cannot Replace Human Experience and Judgment
One of the most consistent themes emerging from our HR Consultants’ conversations with employers is that AI can support HR functions, but it cannot replace experienced professional judgment. AI tools may improve administrative efficiency, summarize large amounts of information, or help identify operational trends. However, workplace decisions still require context, discretion, and judgment that technology cannot independently provide.
Areas where direct human review remains particularly important include:
- Accommodation discussions
- Employee investigations
- Workplace dynamics
- Performance coaching
- Disciplinary decisions
- Workforce restructuring and
- Sensitive employee communications
Replacing the interpersonal dynamics, credibility assessments, historical context, and legal nuance of HR with automated systems can expose employers to avoidable liability. AI should not be viewed as a replacement for HR expertise, but instead a tool that supports it.
Why This Matters to Brokers
As clients navigate evolving workplace trends and technologies, brokers, who are often viewed as trusted strategic partners, may be approached to provide guidance. When it comes to AI, you may have clients ask you questions such as:
- Whether they should establish a formal AI-use policy
- What workplace AI tools are recommended
- Which AI tools employees are authorized to use
- Whether confidential or employee information may be entered into public platforms
- How AI-assisted employment decisions are reviewed and documented
- Whether their managers should receive training regarding appropriate AI use
- How partnering vendors store, retain, or access workplace data
- Whether internal cybersecurity protocols address AI-related risks and
- Which departments are responsible for oversight and governance.
For those that don’t have the answers to these inquiries, access to experienced HR and employment-law guidance can help employers make informed decisions before problems escalate.
Expanding Workplace-Risk Conversations
When discussing AI with clients, remember that many of the decisions being made can impact governance, documentation, accountability, and more. Many employers may not initially view workplace AI adoption as a traditional employment-risk issue but, in reality, AI use may intersect with:
- Employment practices liability
- Cybersecurity exposure
- Privacy and data-governance obligations
- Internal training deficiencies
- Inconsistent manager practices and
- Employee-retention concerns.
These conversations can create opportunities for brokers to help clients identify gaps in internal policies, manager training, vendor oversight, and workplace decision-making processes before issues escalate into larger operational or legal challenges.
A Resource for Your Clients
As we’ve discussed, rapid adoption of workplace AI without governance controls can create unintended consequences. However, organizations that establish clear review standards, manager training, and internal accountability processes are often better positioned to balance innovation with workforce risk management. Engage PEO’s HR Consultants can serve as an extension of your advisory network, helping employer clients navigate the risks and compliance challenges associated with AI and other HR matters.
If your clients are asking questions about AI in the workplace, our team can provide guidance on this evolving area, and many other HR and employment-related challenges. Engage is here to support you and your clients every step of the way. Reach out today to explore how a trusted PEO partner can safeguard your relationships, enhance client satisfaction, and create lasting value.
This article does not constitute legal advice and does not address state or local law.
Click here to watch a short video about the referral partnership program with Engage PEO.
Ailene Dewar Costello
CBPA, aPHR, Vice President of Sales, California, Engage PEO, possesses extensive experience in human resources, recruiting, and workers’ compensation as well as deep experience in healthcare. Ailene is certified as an Associate Professional Human Resources (aPHR) by the Human Resources Certification Institute (HRCI) as well as certified as a Certified Business Performance Advisor (CBPA) by the University of Houston, Bauer College of Business. She possesses a California life & health insurance license. Serving as Vice President of Sales, California for Engage PEO empowers Ailene to help businesses succeed by strategically managing their human capital. At Engage, Ailene helps business owners, CEOs, CFOs, and founders of startups to focus on the creation, development, marketing, and deployment of their product/service.
Featured in our June 2026 Issue page 26 – Click here to download!
Helping Health Brokers and Their Clients Plan for Retirement
COMMISSION
Phil Calhoun and David Ethington in conversation with Peter Buechler
Experience the Full Interview!
Phil Calhoun of Commission Solutions, a program under Integrity Advisors, and David Ethington of Integrity Advisors hosted a recent webinar with Peter Buechler, president of Cohesive Insurance Services, to discuss how subagents and health insurance professionals can protect their income, stay active, and grow into the next phase of their business.
The recording focused on how brokers can prepare for an exit, preserve client relationships, and create new opportunities after a book sale. The conversation centered on planning, taxes, and practical ways to keep earning while easing out of the day-to-day demands of the business.
Buechler’s Background
Peter Buechler opened by sharing how he entered the industry at 17 years old as a telemarketer for a life insurance agency. He said he eventually became licensed, worked through college, earned a business degree from California State University, Fullerton, and moved from life insurance into the wholesale and retail annuity business.
For the past 14 years, he has served as president of Cohesive Insurance Services, where the firm helps brokers place fixed index annuities, single premium annuities, and other single premium products. He described Cohesive as a field marketing organization that works with independent agents, senior specialists, and advisors who serve clients moving from accumulation into retirement.
Planning for Exit
Buechler said the first step in any retirement or exit conversation is to understand the client’s full financial picture. “Let’s get a basic, where are we at, what’s going out, and what do we need to make sure that every morning we wake up, we know we’re covered and we can enjoy that retirement from there,” he said.
He stressed the importance of reviewing assets, liabilities, income sources, and monthly spending before making major decisions. In his view, brokers should not begin with the sale itself. They should begin with the financial question of whether the seller can support the next stage of life with confidence.
Income Gap Strategy
Buechler explained that he often uses income gap planning to help determine whether a client’s guaranteed income can cover essential expenses. Social Security, pensions, and other dependable income sources are the starting point. If there is a shortfall, annuities may help fill the gap and provide stability.
He said that giving clients a clear picture of where their money is coming from and where it is going can reduce fear and create peace of mind. In his words, once clients know they can cover necessary outflow, they are better positioned to enjoy retirement and let the rest of their assets work more effectively.
Tax and Payout Choices
The discussion also addressed how health insurance brokers often structure book sales. Calhoun noted that sellers may receive a percentage of future commissions over time rather than a lump sum, which can help with tax mitigation. That structure also gives sellers options depending on whether they want immediate liquidity or ongoing income.
Buechler said those choices are personal and depend on the seller’s goals. Some brokers want to cash out and move on completely, while others want to keep a revenue stream and maintain some level of activity. He emphasized that the right plan depends on how much income is needed, how much tax exposure exists, and how involved the broker wants to remain.
Staying Client-Facing
One of the strongest themes in the webinar was that selling a book does not have to mean losing client relationships. Buechler said many brokers still want to stay connected to their clients, even if they no longer want the heavy service burden of daily health insurance administration.
He pointed out that Medicare and senior clients often need related solutions such as annuity reviews, guaranteed lifetime income planning, beneficiary reviews, and life insurance policy reviews. That creates a natural path for brokers to continue serving the same clients in a lighter, more strategic way.
Flexible Advisory Roles
Buechler said he and his team can support several levels of involvement. In one model, the broker stays fully active and receives the full broker level compensation. In another, the advisor takes a smaller role and allows Cohesive to support the client more directly.
He described the process as highly customizable. “It really depends upon the level of involvement the advisor wants,” he said. “Whether you handle it all or we handle it all or somewhere in between, you know, we can find the mix that works best.” That flexibility can be especially valuable for seasoned California brokers who want to transition without abruptly severing client ties.
What Brokers Need
The webinar also highlighted the value of fact finding, ongoing review, and practical planning tools. Buechler said strong advisors already know how to ask the right questions and monitor whether the plan is still doing what it was intended to do.
For brokers in California, that approach fits the realities of the market. Clients are aging into Medicare, commissions are changing, and many bookholders are thinking about succession or retirement sooner rather than later. Buechler’s message was that exit planning should be treated as a business strategy, not just an emotional decision.
In Conclusion
The conversation ended with a reminder that many of the solutions discussed are customizable and built to match the broker’s goals. Buechler and Calhoun made the case that brokers can protect income, maintain relationships, and create new opportunities if they plan ahead and take a structured approach.
To connect with Peter Buechler and learn more about how Cohesive Insurance Services assists health insurance professionals cross-sell annuities to help their clients, brokers can visit Cohesive Insurance Services. To learn more about how to plan to protect, grow, and eventually sell your health insurance commissions, you can reach out and get questions on your Medicare, Group, or IFP book transitions.
If there is a shortfall, annuities may help fill the gap and provide stability.
Featured in our June 2026 Issue page 28 – Click here to download!
Peter Buechler
Peter Buechler is President of Cohesive Insurance Services, a brokerage general agency serving financial professionals across the country. Based in Orange County, California, Peter brings decades of experience in financial and insurance planning and is known for his leadership in the annuity and insurance markets. A past president of both NAIFA–Orange County and NAIFA California, he’s a frequent industry speaker and advocate for professional growth. At Cohesive, Peter focuses on helping advisors succeed through integrated planning, education, and innovative case design.
(714) 406-3022
Celebrate National Great Outdoors Month this June
CALIFORNIA POSITIVE
By California Broker Magazine
The month of June is officially designated as National Great Outdoors Month in the United States. For those lucky enough to live in or visit Southern California, it’s not just a month—it’s a lifestyle. With beaches, deserts, mountains, and forests all within driving distance, SoCal offers endless opportunities to reconnect with nature.
Originally named “Great Outdoors Week” by President Bill Clinton in 1998, National Great Outdoors Month has expanded into a month-long celebration of America’s public lands, eventually receiving official U.S. Senate designation and annual state proclamations across the country. This month is a perfect time to celebrate the physical, mental, and economic benefits of spending time in our nation’s parks, forests, and wildlife refuges while encouraging hiking, camping, biking, and more.
This year, make June your month of discovery. From the cinematic landscapes of Joshua Tree and Malibu to the shimmering coastlines of Laguna and La Jolla, every hike, picnic, paddle, and stargazing session reminds us why the outdoors matters—and how spending time in it restores our balance.
Whether you’re planning weekend hikes, beach bonfires, coastal bike rides, or simple moments of mindfulness under an open sky, here’s how to make the most of National Great Outdoors Month across Southern California.
How to Celebrate
There is no “right” way to celebrate, and the “great outdoors” is as close as your nearest park. What matters is participation and presence. Here are a few ways to get inspired this June:
- Go hiking or trail running – SoCal’s diverse terrain offers hikes for all levels: desert canyons, ocean-view ridges, and shaded mountain forests. Lace up your shoes, grab a water bottle, and choose a new trail each weekend of June.
- Plan a beach day – From sunrise yoga at Crystal Cove to sunset surfing in Malibu, coastal relaxation counts as outdoor therapy.
- Try camping or glamping – Whether it’s sleeping under the stars in Laguna Coast Wilderness Park or pitching a tent near Joshua Tree, camping lets you tap into slow living.
- Volunteer for a park cleanup – Many state and local parks host cleanup events during June. It’s a rewarding way to protect the environments you love.
- Take a family nature challenge – Visit one new outdoor spot each week—a beach, a canyon, a mountain, or a botanical garden.
- Go tech-free for an entire day – Take a break from screen time. Reconnect with the breeze on your face, the crunch of gravel underfoot, and the sounds of real birdsong instead of phone alerts.
Hiking Trails to Explore
Southern California boasts some of the nation’s best hiking trails, from canyon views to coastal cliffs, each offering something unique and beautiful. Below are a few of SoCal’s most beloved hiking trails—perfect for celebrating Great Outdoors Month.
Orange County
- Crystal Cove State Park – Spread along the Newport–Laguna coastline, Crystal Cove offers more than 18 miles of trails that wind through coastal bluffs and tide pools. You can start at the beach and ascend to panoramic ocean vistas—a rare balance of seaside serenity and rugged hill climbing.
- Laguna Coast Wilderness Park – Known for its rolling hills, sandstone canyons, and wildflower-dotted trails, Laguna Coast Wilderness Park feels worlds away from civilization, even though downtown Laguna Beach is minutes away. Keep an eye out for mule deer and red-tailed hawks as you traverse the park’s 40 miles of protected paths.
- Santiago Oaks Regional Park – If variety is your hiking motivation, Santiago Oaks delivers. Located in Orange, this sprawling park connects riparian woodland trails with steeper switchbacks offering summit views of Orange County’s suburbs below. Each step takes you from shaded creek beds to lofty ridges lined with chaparral and oak.
Los Angeles
- Solstice Canyon Trail in Malibu – This gentle coastal trail blends history and nature, passing through shaded creek beds and ruins of an old ranch before reaching a small but beautiful waterfall. It’s a peaceful three-mile loop that offers plenty of Instagram-worthy stops and a cooling ocean breeze.
- Bridge to Nowhere in the San Gabriel Mountains – Not for the faint of heart, this 10-mile round-trip hike in the San Gabriels leads to an abandoned 1930s bridge deep in a canyon. Multiple river crossings keep things interesting, and adventure seekers even bungee jump from the bridge’s mid-span. It’s a truly unique slice of LA hiking lore.
- Runyon Canyon in the Hollywood Hills – An urban classic, Runyon Canyon merges scenic views with people-watching—plus the occasional celebrity sighting. The 3-mile loop climbs to Cloud’s Rest, offering panoramic views of LA, from downtown to the Pacific.
San Diego
- Torrey Pines State Reserve Loop in La Jolla – Perched atop 300-foot cliffs above the Pacific, this coastal reserve is home to the rare Torrey pine and miles of seaside trails that reveal sweeping water views. It’s an easy loop that merges exercise with awe.
- Big Laguna Trail in Mount Laguna – About an hour east of San Diego, this scenic loop passes through meadows, woodlands, and viewpoints overlooking the desert below. It’s also part of the legendary Pacific Crest Trail, meaning you’ll literally tread part of a national hiking icon.
- Potato Chip Rock in Poway – Famous for its wafer-thin rock ledge that makes for daring photos, this trail is a rite of passage for San Diego hikers. The steep 7.5-mile round trip rewards trekkers with panoramic views all the way to the ocean.
Nature and Mindfulness
While the focus of National Great Outdoors Month is on getting outside, the larger message is to promote wellness and environmental awareness. Studies show that spending time outdoors improves physical health, lowers stress, and boosts mental clarity. For children, nature-based play fosters creativity and empathy. For adults, getting outside and detoxing from screen time can feel like a reset button.
Psychologists often speak of “attention restoration theory”: the idea that nature resets our cognitive energy by engaging us without demanding constant focus. Hiking is particularly effective because it offers rhythmic movement, simple goals, and reflective solitude. You start tired and finish renewed—not just physically but emotionally clearer.
The more you practice this kind of outdoor mindfulness, the deeper it works. Some hikers carry journals, noting how each trail feels different in morning light versus afternoon shade. Others treat it as moving meditation, syncing breath to step. However you do it, June is your chance to slow down and notice again.
The Bigger Picture
National Great Outdoors Month isn’t only about exploring nature—it’s about protecting it. Every path you walk has been preserved through decades of conservation work. Participating in trail maintenance events, picking up litter, or supporting local parks helps ensure these experiences last for generations.
- Practice “Leave No Trace” ethics. Pack out what you bring in, stay on marked paths, and respect wildlife habitats. Even small steps—like avoiding shortcut trails that cause erosion—add up to big impacts.
- Support park programs. Many regional parks in Southern California rely on memberships or donations. Contributing to organizations like the Orange County Parks Foundation or the Santa Monica Mountains Fund directly supports trail upkeep.
- Share responsibly. When posting trail photos, share details that encourage sustainable travel—how to park legally, follow rules, and respect seasonal closures.
The outdoors doesn’t belong to one person, one city, or one season—it belongs to all of us, year-round. This June, make your mark lightly: footprints on a sandy trail, laughter echoing off canyon walls, or the quiet moment you stand still and simply notice how the sun feels on your skin. That’s the essence of National Great Outdoors Month—not just being outside but being part of it.
“Studies show that spending time outdoors improves physical health, lowers stress, and boosts mental clarity.”