AI will become Omnipresent
Christian Westermann, Group Head of AI, Zurich Insurance Group
In 2025, insurers’ success will be influenced by their ability to integrate and adopt AI into their core business. With AI tools becoming omnipresent, it is crucial to avoid distractions. Insurers should showcase AI’s business impact by targeting high-value and high-impact areas such as claims handling, underwriting, and customer touchpoints. This approach will help them showcase the value to stakeholders and maintain their competitiveness.
Innnovation in AI will continue to accelerate. Building on the deeper understanding of GenAI and LLMs achieved in 2024, and with the emergence of agentic AI and multi-agent environments, companies will need to excel in several key areas: distinguishing hype from reality, identifying truly transformative technologies, keeping pace with market advancements, and maintaining a clear focus in technology selection and adoption.
A Technology-First Mindset
Pravina Ladva, Chief Digital & Technology Officer, Swiss Re
Looking ahead to 2025, leveraging data and technology will remain key to driving business impact and bottom-line growth. As AI-powered tools are being implemented across the insurance value chain, we’ll increasingly see efficiency gains, improved risk management and enhanced customer experiences.
However, success doesn’t solely rely on adopting new technologies; it’s also about harnessing existing digital tools to their fullest potential, ensuring they are aligned with strategic goals and delivering measurable commercial value. That requires the right combination of advanced analytics, human expertise, as well as transparency and compliance.
Equally important is investing in people and nurturing talent to meet the demands of an increasingly data-driven world. By fostering a culture of continuous learning and upskilling, organisations will empower their employees to embrace cutting-edge tools for business impact.
As the insurance industry navigates complex challenges like cyber threats, data privacy concerns, and regulatory complexities, a technology-first mindset combined with human judgement will be key to sustainable growth and resilience. This forward-looking approach will position businesses not only to adapt but to succeed in an ever-evolving digital landscape.
Mapping of Emerging Risks
Daniel Almodovar, Innovation Delivery Manager, MAPFRE
The current context presents an unprecedented challenge for the insurance sector. Aspects such as geopolitical conflicts, volatility in macroeconomic data, or emerging risks like climate change, cyber protection, or the rise of generative artificial intelligence, among others, are leading the sector to prepare for multiple scenarios if it wants to meet all social needs.
Precisely, the map of emerging risks will be one of the industry’s focuses for 2025. In the coming months, we will see greater coverage in these areas to try to mitigate and respond quickly to these challenges. Innovation teams will work to offer new products and services, and modalities such as parametric insurance can gain importance as a complement to traditional insurance. Insurers and reinsurers that want to remain competitive in their markets will need to incorporate new formulas to measure risks, adjust premiums, and guarantee top-level service, as well as raise awareness among teams about the importance of these challenges, both in terms of business and reputation.
Quantum Computing and Hybrid Cloud
David Lynch, Group Chief Technology Officer, bolttech
Expect more experimentation with quantum computing and hybrid cloud solutions. Although conventional cloud services have been sufficient for most industry challenges, the growing accessibility and affordability of quantum computing is opening up new possibilities. Initially focused on security and cryptography, quantum computing may soon be applied to areas like fraud prevention, supply chain risk management, and financial risk assessment. As the challenges surrounding accessibility and affordability are addressed, it could significantly improve timely interventions and outcomes in the insurance sector.
Data-Driven Insights & Sustainability Goals Prioritised
Jing Liao, Chair, Solera Foundation & Chief Administrative Officer, Solera
“Sustainability is no longer a choice — it’s a necessity for the survival of future generations. Data-driven insights unlock transformative opportunities, enabling insurers and connected industries to reimagine traditional practices. By adopting solutions that enhance global resilience, boost efficiency, and lower costs, businesses can lead the way toward a more sustainable future.
A circular economy holds the key to breaking the cycle of waste, conserving resources, and reducing environmental impact. Through the power of data and AI, we can build transparent, sustainable ecosystems that merge economic growth with environmental stewardship. Together, we must tackle pressing challenges, align with global sustainability goals, and leave a lasting legacy for generations to come. Let’s make the change today. “
Technology-driven Personalised Services
Sabine Vanderlinden, CEO and Founder, Alchemy Crew
In 2025, insurers will need to focus on delivering engaging and personalized digital services to increase margins while controlling costs. This entails leveraging AI and machine learning to automate processes, improve underwriting accuracy, and streamline claims processing. Insurance companies will invest in predictive analytics and data-driven insights to better understand customer needs and anticipate market trends.
Alongside this, by utilising behavioural data and machine learning algorithms, insurers can predict user intent and lower risk, leading to more effective decision-making. In addition, as AI systems are deployed across the organisation, the ability to validate AI code to reduce AI risk across operations, within the design of products and the evaluation of profiles (i.e., bias and discrimination) will become highly in demand.
Companies will leverage AI and digital tools to provide adaptive training programs that equip employees with the skills needed to thrive in a technology-driven environment Flexible work arrangements and a focus on talent retention will be crucial in aligning with shifting employee expectations and maintaining a competitive edge.
Focus on Operational Effectiveness
Chaz Perera, CEO of Roots Automation
This coming year, pricing will no longer be a competitive advantage for insurance businesses. They will need to increase margins while keeping costs down. To achieve this, they will focus on bolstering productivity while offering customisation for better client service across their claims and underwriting departments.
The insurance industry will lean on robust upskilling platforms to counteract the increasingly aging workforce. 2025 will see companies intensify efforts to close the skills gap. Initiatives will leverage AI and digital tools to provide adaptive training and operational resources tailored to modern needs. Successful players will combine these technologies with flexible work arrangements to align with shifting employee expectations. This dual approach will drive competitiveness by balancing workforce transformation with effective talent retention strategies.
AI will disrupt the traditional insurance outsourcing model by automating routine tasks that were typically offshored, cutting outsourcing jobs in half in the next three years. Intelligent workflow agents will dramatically change work design. Dynamically distributing work based on real-time capacity and expertise, and managing end-to-end process orchestration and execution, they will drive further reduction in outsourcing.
2025 will mark the rise of a trainable agentic platform in insurance which will push towards parity of onboarding for digital and human workers. This platform will include training materials and standard operating procedures that can be ingested and leveraged. The technology winners in this space will provide guardrails for agentic AI that’s operating without a human while easily scaling.
Web3 as the Foundation for AI Scalability and Security
Lisa Wardlaw, CEO and Founder of Digital Immersion 360
As the insurance industry braces for rapid transformation steeped in AI as a catalyst, three foundational trends stand out as critical for innovation and scalability.
The fusion of Web3 and AI has the potential to reshape insurance by addressing core challenges in data scalability and trust. Decentralized architectures enable tamper-proof, real-time data sharing while enhancing security and reducing bottlenecks. Insurers can leverage these technologies to reimagine processes like underwriting and claims, creating transparent, scalable systems built for the future.
Secondly, HybridTransactional/Analytical Processing (HTAP) bridges the gap between operations and analytics, enabling businesses to act on real-time insights within their workflows. By integrating HTAP with decentralised data models, insurers can revolutionize fraud detection, claims resolution, and customer personalisation. Real-time, contextual insights become the norm, allowing insurance to move at the speed of customer expectations.
Finally, traditional ETL processes are an innovation bottleneck. The rise of low-to-no ETL solutions eliminates silos and operational delays, enabling AI models to work with decentralized, high-quality datasets in real time. This evolution reduces costs, enhances collaboration, and accelerates decision-making, empowering insurers to keep pace with dynamic markets.
These trends aren’t just technical shifts—they’re a reimagining of the industry’s infrastructure, creating a foundation for scalability, agility, and innovation. For insurers and InsurTech startups, the path forward is clear: embrace these technologies to unlock AI’s full potential, redefine customer experiences, and set the stage for sustainable growth in 2025 and beyond. The future is bold—let’s build it.
Advancements in Geospatial Intelligence
Matthew Patience, Client Solutions Manager, McKenzie Intelligence Services
Increasingly, insurers will be using advancements in Geospatial Intelligence to shift their focus from First Notice of Loss (FNOL) to First Notice of Incident (FNOI) following Nat Cat events, because it enables them to focus on proactive risk management over reactive claims handling.
This helps insurers to both accelerate the on the ground event response and their speed of loss reserving, reduce claims costs and ultimately enhance the customer experience.
Financial Impact of Ransomware will Escalate
Resilience‘s Justin Shattuck, CISO
Over the past several years, I’ve seen industry experts and government agencies alike increasingly push for contract language between companies and their third-party vendors to transition from nebulous phrases like “should” into specific, binding phrases like “shall” – ie, “multi-factor authentication shall be implemented.” In 2025, I anticipate that this push will become more mainstream.
Research from my company, Resilience, showed that the financial severity of ransomware attacks jumped significantly last year – by 411%. I expect that the financial impact of these attacks will likely continue in an upward trajectory, thanks to advancing attacker strategies, targeting of critical industry sectors, and rising ransom payment demands.
In 2025, I think that CISOs will become even more visible in board roles. CISOs help bridge the gap for boards that traditionally lack an understanding of cybersecurity, but as the financial implications of successful attacks become more understood, CISOs will bring a level of insight and technical acumen that helps boards better prioritize remediation and mitigation of these risks with strategic decision making. As a result, companies with more emboldened and empowered CISOs will fare better when it comes to preventing and mitigating the effects of attacks
The future of insurance is collaborative
Rob Schimek, Group Chief Executive Officer, bolttech
2025 will see an increase in notable global collaborations, as we see more players recognise that working together is the best way to innovate and meet evolving customer needs. By combining strengths, sharing insights, and expanding capabilities, partnerships will enable the industry to deliver more comprehensive solutions and improve customer protection.
As the global protection gap continues to grow, these collaborations will be crucial in addressing the need for tailored, affordable, accessible and convenient insurance. Partnerships that foster financial inclusion provide benefits across the value chain – insurers, insurtechs, and most importantly, the customers who rely on us for security and peace of mind.
Rising Taxes, Gen Z Driving Change
Julian Hucks, Founder and Managing Director of Starpeak
The rollout of the FCA’s Consumer Duty highlighted the importance of consumer protection, [is] driving insurers to focus on management information and to justify the value of the insurance they are delivering to consumers.
Economic pressures in the UK will undoubtedly continue to test the sector in 2025. The Labour government’s increase of business taxes will strain profitability due to the impact on wage growth and the price of consumer goods. As a knock-on effect, rising insurance premiums – driven by increased costs – will exacerbate the insurance gap. This is because stretched budgets will force many to unwisely cut down on coverage. This trend underscores the importance of addressing affordability and access as insurance companies plan future strategies.
Additionally, the growing influence of Gen Z on the industry cannot be underestimated. This demographic’s preference for online purchasing and digital interactions is reshaping the sector. As such, insurers must embrace seamless, tech-driven customer journeys to remain competitive. As the industry navigates these intersecting challenges, success will hinge on a balance of technological innovation, customer-centricity, and social responsibility. The most forward-thinking insurers will view this not as an obstacle, but as an opportunity to redefine their role – transforming from risk managers to essential partners in their customers’ financial well-being.
Profitability in Distribution and the Rise of MGAs
Jeff Heine, CRO, Novidea
Carriers today face mounting pressure to broaden their distribution channels without sacrificing profitability. To address this, many are buying or opening their own MGA, or supporting others with capacity to provide flexibility and more focused distribution channels for niche products.
MGAs have become a critical part of distribution strategies, enabling carriers to efficiently reach niche markets and align with the changing needs of customers. For carriers, MGAs offer a way to diversify their portfolios while maintaining tighter control over underwriting standards, helping them achieve that essential balance between growth and profitability.
Espionage and Regulatory Pressures will Intensify
Dr. Aleksandr Yampolskiy, Co-Founder and CEO of SecurityScorecard
Governments worldwide will create strict security regulations in 2025, requiring both organisations and their suppliers to follow enhanced safety standards. Some software, including open-source programs with known security flaws, may face outright bans. These regulations will make organisations responsible for thoroughly evaluating their software selections and supplier partnerships as governments take steps to protect critical infrastructure and reduce system vulnerabilities.
In 2025, the Trump administration’s national security priorities will lead to direct action against Chinese cyber operations. China will target more U.S. infrastructure systems through hidden network access points, particularly in compromised routers. Rather than launching immediate attacks, these concealed entry points serve as strategic assets for potential future conflicts. This approach of establishing quiet network access, combined with rising international tensions, this passive infiltration strategy will underscore the urgent need for vigilant monitoring of infrastructure vulnerabilities — vulnerabilities that could be activated when tensions reach their breaking point.
As attackers zero in on the weakest links in supply chains, third-party breaches are set to shatter previous records. Vulnerable, smaller partners — often less equipped to fend off sophisticated attacks — are becoming backdoors to infiltrate larger organisations. This trend will force companies to rethink their risk management strategies entirely.
Wishful thinking and AI-washing
Adrian Cox, Chief Executive Officer, Beazley
AI and how it can transform business has dominated conversation this year. This is likely to continue into 2025, with our latest Risk and Resilience report finding that 80% of companies are planning to integrate AI into business practices. But are businesses leaping in without looking and possibly opening themselves up to an accusation of ‘AI-washing’?
Amid the excitement surrounding AI’s potential, businesses should take stock and ensure they are taking a considered approach as they implement AI, making sure that investment in AI does not divert attention away from getting the basics right, particularly around cyber risk.
We will only be able to definitively say we are in an ‘AI bubble’ when it bursts, but with any new, exciting technology, hype can quickly outpace reality.
Crucially, businesses will benefit from exercising caution and not overstating the use or impact of AI on their services and profitability. In the US for example, we have already seen a number of high-profile cases cracking down on AI-washing, including the Securities and Exchange Commission’s fines on investment advisors Delphia and Global Predictions. We are likely to see similar actions in other regions.
Focus on Climate Risk Forecasting Technologies
Jonathan Jackson, CEO of Previsico
Climate change poses both a threat and an opportunity for the insurance industry, as the frequency of natural catastrophes, including floods, continues to rise. This growing risk creates an urgent need for enhanced risk mitigation and wider insurance protection.
“By 2025, forward-thinking insurers will increasingly embrace innovative Insurtech solutions. These technologies—such as advanced risk assessment tools and real-time flood forecasting—will allow insurers to more accurately price and underwrite risks, while working in partnership with their customers to mitigate potential losses.”
The impact of Insurtechs UI/UX
Megan Wood, President of Genius Avenue
From underwriting to claims, insurtech solutions providers are driving change and unlocking cost savings and efficiencies across the value chain. However, the user experience for most policyholders remains sub-par in comparison to other industries.
The expectation that the next generation of buyers will tolerate an inferior user experience or purchase insurance products they don’t understand how to use is entirely flawed, yet we haven’t seen any company leverage leading UI/UX, conversational AI or the full scope of digital payments and disbursement to improve the user experience. If we redefine enrollment and engagement with a simple, streamlined, understandable mobile experience, we will dramatically increase adoption and retention.
One of the most interesting insurance trends we see is the acceleration of non-traditional benefit options playing in the more traditional insurance spaces. One example is better-designed “discount network” programs infringing on some healthcare and insurance offerings. This includes pet discount networks that are more cost effective than pet insurance offering real savings and reliable service to the end user. Similarly, dental and vision discount networks actively steal membership from more typical insurance offerings.
Focus on Silo Management and Internal Operations
Manoj Pant, insurance industry expert, Pegasystems
All these strategies and forecasts for insurers to adopt new technologies in 2025 will be inhibited unless they do more to break down silos in their internal operations and organizational silos. Unlike other industries, insurers remain too focused on product and function centric business models rather than adopting a truly customer-centric approach. This challenge is compounded by technical debt.
Insurtech innovations play a critical role in introducing technologies that sharpen customer engagement and streamline business processes. A unified partnership with Insurtech can help establish a 360-degree view of the customer at every interaction, ensuring smarter and more agile responses. However, digital transformation projects often still demand a significant amount of manual work to map out and automate processes, which slows down progress.
Accelerating collaboration with Insurtech firms can be instrumental in breaking down these internal barriers and technical debt. By doing so, insurers can harness the full potential of technologies like generative AI and other advanced tools, ensuring their value is realised sooner. The transformative impact of these innovations will remain muted without serious efforts to overhaul internal structures to be a customer-centric organisation and integrate Insurtech solutions.”
The Soft Market Isn’t Going Anywhere Yet
Shawn Ram, Head of Insurance, Coalition
In a year defined by events at Change Healthcare, CDK Global, and CrowdStrike, it’s no surprise that “aggregate risk” has been a key topic of discussion. Despite the very tangible fallout of all three incidents, none have shaken our industry as significantly as cyber risk models predicted. However, the very real threat of aggregate events will continue and at a greater frequency. In the future, the cyber insurance market will need to respond, but the true impact won’t be felt next year.
Market softening will likely continue in 2025, but it’s slowing. Pricing decreases will likely sit in the single digits — around 5-7%. At some point, a large-scale event will lead to reinsurers and retail insurance companies pushing back on pricing, but there’s likely some time before that plays out.
AI Regulations and Innovations in the Life Insurance Space
Brian Carey, Senior Director of Insurance Solutions, Equisoft
Carriers shouldn’t write off AI regulations. They seem less likely under the incoming U.S. presidential administration, but they could be enforced at the state-level, especially since there’s already regulatory activity in the EU. Insurance commissioners don’t want to stifle innovation or regulate in a vacuum, but if the technology can’t fulfill the role that regulators and consumers envision, that’s when guidance could be introduced.
The life insurance industry is also primed for innovation. When a policy is issued, insurers typically focus on meeting that one immediate need. But as policyholders move through different life stages and events, new needs arise that carriers have the opportunity to address. To remain relevant, carriers must build the right tech stack to support these changing needs and create flexible products that can evolve with them.
Tech-Enabled MGAs will Increasingly Drive Tailored AI Innovations
Jason Kaminsky, CEO, kWh Analytics
In 2025, we expect tech-enabled MGAs to advance proprietary in-house AI insurance solutions tailored to the markets they serve. While we have seen global carriers and reinsurers partner with insurtechs to deliver AI solutions, tech-enabled MGAs are increasingly taking on this role themselves. Operating within specific market segments and leveraging unique datasets, they are well positioned to create highly tailored solutions that address distinct challenges in the insurance marketplace. While we can expect to see differences in design, functionality, and impact between the AI solutions developed by tech-enabled MGAs and those aimed at serving the broader market, both will push forward AI innovation that will further the evolution of business models.
Data Readiness Risks will Expand as Embedded AI Gains Traction
Mike Allee, President, UCT
Life insurers are exploring the use of AI in ‘cost-intensive’ fully or partially digitized service operation areas and siloed IT sources, such as PAS, underwriting, new business admin, and claims. Carriers will continue to invest in and prioritize proof of concept use cases for AI and associated data projects, but data readiness, sourcing and context will largely determine the success of these initiatives.
The vital data Internet of Things (IoT) can provide will advance its standing in insurance. While life insurance continues to lag in adopting IoT, its scalability and valuable information will provide compelling business cases for investing in the technology and expanding it alongside AI.
