Property and casualty insurers are urged to embrace technology to optimize their operations, as per analysts. This digital push is set to be a dominant trend in the next five years, with consumers seeking swifter and more convenient insurance experiences. Henrik Naujoks of Bain & Co. emphasizes the significance of adapting to tech changes to capitalize on market trends and mitigate risks.
The industry faces a slew of emerging risks in 2025. Natural catastrophes are becoming more frequent and intense, especially in the Asia Pacific region, which is highly vulnerable due to rapid urbanization. Unusual risks like potential armed conflict and growing societal unrest, including misinformation and foreign interference during elections, also loom large. Reinsurers need to devise innovative solutions for such complex, non-traditional risks.
Generative AI presents an opportunity for insurers to enhance operations. Initiatives like Zurich’s use of claim data and a South American insurer’s AI-powered tools have shown productivity and cost-saving benefits. However, the hype around AI is waning as insurers focus on tangible returns. Cybersecurity risks, exacerbated by deepfake technology and insider attacks, require strict regulatory compliance and human oversight. Additionally, there’s untapped potential in nonmotor and commercial insurance in certain Asian countries, where insurers are encouraged to be more enterprising with regulatory support.
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