Continuing the Predictions 2025 theme, here we have a round up of GI comments and insights. Let’s get into it;
SSP
Gijsbert Cox, Industry Leader in Insurance at Appian
1. Compliance burdens will continue to grow:
I expect the insurance industry to face increased regulation in 2025. As organisations use AI to automate insurance, regulators will scrutinise them. They want to set standards for AI ethics, transparency, and bias. With laws like the EU’s AI Act, 2025 will be tough for insurers. They must follow new rules. They must meet stricter requirements or risk fines and damage to their reputation.
2. Data privacy and security will become competitive differentiators.
In 2025, worries about data privacy and third-party misuse will peak. There is growing scepticism about AI and cybersecurity risks. Next year, we expect customers to demand better data protection. Insurers will turn to a private AI to keep the data in-house and increase control. In 2025, data privacy will be a strategic priority. Customers will care about it, not just as a regulatory checkbox. The insurers who best meet these data and transparency demands will win.
3. Tangible results of AI will drive industry transformation:
In 2025, insurers will start seeing tangible returns from AI investments. In 2024, organisations began to experiment with the technology. In 2025, we will recognise the results and the profits from them. AI can analyse complex datasets. It will help underwriters to make better decisions, assess risks, and tailor policies. Also, AI will reduce claims processing times from days to minutes. Insurers that use AI in core operations will save costs and improve efficiency. This will put them ahead of competitors who are reluctant to invest in these technologies.
PEGASYSTEMS
Manoj Pant, insurance industry expert, Pegasystems offers these insights;
The Premium Rollercoaster Ride Settles Down
As elements like interest rates and inflation finally settle into a steadier rhythm, I predict that in 2025 we will continue to see a notable decrease in insurance premiums, specifically in personal lines. This isn’t just about lower policy premiums ; it’s about sparking a vigorous wave of competition among insurers, specifically in personal lines. There’s a real opportunity here for insurers to creatively refine their pricing and customer engagement strategies. By doing so, they can remain competitive but also become more aligned with consumer expectations.
This evolving environment presents a unique opportunity for insurance companies to rethink and be innovative in defining their pricing models, product offerings, and customer engagement strategies. By personalised marketing, and innovative business models and product structures, insurers can better cater to the needs of a more value-conscious consumer base. Furthermore, integrating advanced technologies like AI, machine learning, and data analytics can significantly improve the accuracy of risk assessments and the customisation of insurance products and premiums.
This alignment with consumer expectations not only boosts competitiveness but also fosters trust and loyalty, making it a win-win for insurers and customers alike. In essence, 2025 could mark the beginning of a new era where insurers don’t just lower premiums but also elevate the entire customer experience. In a market where customers are increasingly vigilant about ensuring every penny spent delivers tangible value, insurers that prioritise transparency, flexibility, and value for money will likely emerge as leaders.
Bring Intelligence to Every Customer Engagement
The future is personalised customer engagement, powered by AI.
To attract customers, insurers must deliver content that is relevant, contextual, and timely to maximize value. Customer engagement requires understanding in-the-moment customer needs and preferences across channels. Finally, to delight customers, insurers need to deliver targeted, right-sized products and services
We’ll be looking at technologies in 2025 that not only refine risk assessments but tailor premium pricing and offers to individual preferences and behaviours to attract, engage and delight them. Imagining AI transforming sales and marketing, claims processing, underwriting and customer service into more intuitive and responsive customer experiences. I expect to see more use of AI in the below areas to maximise customer loyalty and increase customer lifetime value:
- Strengthen effectiveness of sales and marketing by delivering personalised experiences through every channel. This will help insurers to drive conversion with relevant interaction
- Provide pro-active, empathetic experiences & communications across all channels to increase engagement and customer satisfaction
- Promote loss control best practices and mitigate the impact of major events to minimise claims looses
- Create nurturing touchpoints and identify at risk policies prior to attrition
By becoming much more data driven, insurers will be able to understand risk on a granular level and price products in a much more tailored fashion. By experimenting rigorously with AI and data analytics, they’ll also elevate efficiency and customer satisfaction to unprecedented levels. These tech advancements, specifically AI, could redefine the customer engagement models and expectations customers have in 2025.
Just a few from the many Predictions listed by DAC Beachcroft;
Construction
Labour’s plan to encourage millions of homes to be fitted with solar panels (the so-called rooftop revolution) and create more solar farms will lead to more claims. Technology is developing at pace; initial installation costs are high; not all roofs are suitable; safety and fire risks are high; and the skilled workforce is unlikely to be able to meet anticipated output. While the industry gets to grips with all of this, we predict greater risks for insurers that all stakeholders will need to consider. Construction all risks underwriters need to consider their exposure carefully and ensure wordings and premium accurately reflect the risks involved.
Directors and Officers
AI has reshaped the financial services industry. It is widely used to summarise information, automate credit and loan decisions, detect and prevent fraud, drive operational efficiency and productivity, and reduce the risk of human error. But if AI learns from incomplete or imperfect data, there is a significant risk of unintended discrimination or unconscious bias, and unchecked reliance on AI could affect large data sets within a customer base and ultimately lead to claims for consumer redress. Recognising the critical importance of AI to corporate strategy and operations and the claims risk, financial institutions are increasingly appointing Chief AI Officers (CAIOs) to oversee the execution and integration of AI projects, promote ethical AI-practices, and ensure the adoption of AI aligns with corporate vision and regulatory requirements.
Data Compliance
Following the Information Commissioner’s Office’s (ICO) stated intention to issue the first fine to a processor for breach of its obligations under data protection law, processors will look to shift how they document their own compliance, including due diligence when appointing sub-processors in their supply chain. It will also result in many processors likely adopting a more robust position in contracts with controllers when negotiating liability caps for data breaches.
Although the final penalty or enforcement notice has not been issued yet, the provisional decision has undoubtedly created a renewed focus and raised potential concerns for processors, reminding them of the importance of things like multi factor authentication. In the event that further fines are levied against processors in the coming year, the rationale behind these regulatory decisions will be awaited with great interest. Any fines issued to private sector or public sector controllers will provide additional understanding on whether the ICO will look to take a harsher line on processors who deliver software and services to the public sector only, or whether the ICO is adopting a wider remit of targeting processors across all sectors.
“As we look ahead to 2025, a significant trend is emerging within the insurance sector: a marked decrease in the number of projects labelled as AI or GenAI. This shift is largely driven by the increasing regulatory scrutiny surrounding artificial intelligence in insurance. Carriers are becoming more cautious about how they categorize their initiatives, opting to minimize or even eliminate AI labels to avoid the complexities of regulatory compliance.
The regulatory landscape is evolving rapidly, with authorities focusing on the ethical implications and accountability of AI-driven solutions. As a result, insurers are finding it necessary to adopt a more conservative approach. By avoiding the AI label, insurers can navigate around the stringent requirements and potential liabilities associated with regulated activities. This not only helps mitigate risks but also allows companies to focus on innovation without the untimely burden of additional oversight or additional oversight when it is actually never needed.
Additionally, in this climate, we may see a trend toward more traditional project classifications, as insurers aim to maintain agility in their operations. This could lead to a proliferation of projects that utilize AI techniques without being explicitly labeled as such, so as to ensure only the projects that are ACTUALLY AI projects be subjected the regulatory oversight, and not all projects doing something innovative with data.
Ultimately, while this strategic maneuvering might limit the visibility of AI initiatives, it reflects a broader desire for compliance and risk management within a heavily regulated industry. As 2025 unfolds, the challenge will be for insurers to balance innovation with regulatory adherence, ensuring that they can still harness the power of AI while navigating an increasingly complex regulatory environment.”
– Oliver Werneyer, Vice President of Product Strategy at Duck Creek
BEAZLEY
Out With Windows 10, in With Migration Gaps and Legacy System Vulnerabilities
By Christian Taube – VP Cyber Services International, Beazley Security
As we approach the complete phasing out of Windows 10 in 2025, businesses face a critical inflection point in their cyber risk posture. The transition to newer operating systems presents opportunities for enhanced security, but it also opens the door to new vulnerabilities as attackers leverage gaps in migration strategies to their benefit. Many organizations will scramble to deal with the fall-out and struggle to find resources to help them mitigate the consequences.
Historically, end-of-life operating systems like Windows 10 have become attractive targets for bad actors, particularly as updates and patches cease. In the months following the EOS (“end of support”) date in October 2025, we anticipate a wave of exploitation attempts aimed at organizations that have delayed upgrading, especially small to mid-sized businesses lacking robust security resources.
The complexity of transitioning legacy systems and integrating them with modern solutions could also create additional unforeseen security blind spots. To mitigate this risk, organizations should proactively audit their systems, prioritize timely migrations, and implement strong endpoint protections. Preparation is essential, as the cost of addressing breaches that exploit these transitional vulnerabilities far exceeds the investment in preventative measures.
DRIVER TECHNOLOGIES
Spokesperson: Rashid Galadanci CEO and Co-Founder looks ahead;
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The future of connected cars in insurance: Currently, many carriers lack sufficient data from connected vehicles to integrate it into pricing models. However, as third-party apps become more widespread and more users opt in to share their data, insurance companies will have the opportunity to develop usage-based insurance (UBI) programs centered around connected vehicles.
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The future of third-party apps in insurance: There is a current shift in the insurance industry’s approach to using third-party apps for connected vehicles. Many corporate legal teams at OEMs/automakers prefer not to have their own branded app and want to distance themselves from directly handling user data. This trend indicates a movement favoring third-party apps over automaker-branded solutions.
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Need for increased transparency and clearer opt-in processes in insurance: There will be an increased need for transparency and clear opt-in processes in insurance programs, especially those involving usage-based insurance (UBI) programs. The term “telematics” is used broadly in the industry, encompassing everything from basic driving data (like location and time of driving) to more complex data (such as video). The inconsistency in what telematics includes can make data sharing feel invasive to customers. To address this, insurance companies can clarify to customers exactly what data will be used when they opt-in. For example, if a program only uses odometer data, that should be explicitly communicated. If more data types, like speeding information, are involved, that should also be clearly outlined. This approach ensures customers understand how their data is used, making the data-sharing process feel more transparent and less intrusive.
GENIUS AVENUE
Meanwhile at Genius Avenue company President Megan Wood has these insights;
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Emerging niches in insurance
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.
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Incorporating compliance into product development
Genius Avenue has supported go-to-market strategies for several new products, and those with compliance dialed in spent less, launched quicker, and were more successful. These days, incorporating compliance into product design is an absolute must. The margin for error, or risk, for a new product going to market is incredibly high, which means every aspect needs to be well thought out at inception to ensure success.
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Leveraging AI to detect potential fraud
Fraud detection leveraging AI has been on the horizon for many years, and we believe the technology has finally caught up to the use case. In the past we’ve considered integration with solutions that tracked cursor movement or typing cadence to flag potential bad actors. However, in many cases, it still required heavy human oversight to produce meaningful results. Now, the AI revolution can leverage user history and machine learning of best practices to make those kinds of approaches cost-effective and impactful.
RESILENCE
Resilience‘s Justin Shattuck, CISO, sees a stronger response to the challenges of cyber attacks;
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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.
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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.
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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.
APEXANALYTIX
Steve Yurko, CEO at apexanalytix, comments on the triaging of asset risks & notifications;
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