Insurance trends in 2024
January 8, 2024 6:22 AM
Insurtech
Stefan Wermuth/Bloomberg
"Less than 1% of insurers will see tangible, direct benefits from generative AI (Gen AI). As a result of ChatGPT's recent popularity, insurers are keenly interested in Gen AI. Many hope it will substantially benefit their operations, customer service, marketing and sales, and IT."
Property & casualty
Oscar - stock.adobe.com
"In 2024, I predict businesses will take a more confident, proactive approach to mitigating their climate risk, which until now has seemed immense and abstract. I'm seeing the attitude change because insurers are capturing, synthesizing and carefully presenting incisive real-world data to policyholders about extreme climate events and risks to specific properties in the context of their resilience."
Cyber risk
putilov_denis - Fotolia
"Cyber extortion events are not going away. In fact, if the final quarter of 2023 is any indicator of 2024, we should all be buckling up for a ride. In 2023, we saw more frequency of cyber extortion events impacting mid to small markets earlier in the year. We started seeing an increase in significant events impacting large enterprise starting in October and holding steady through November. There was noted increase in demands by threat actors and in severity. It remains to be seen whether a soft insurance market, where controls that were in place in the hard market, were set aside and therefore, contributed to the increase in severity."
Workers' compensation
David Paul Morris/Bloomberg
Dale Hoppe, senior associate vice president, workers compensation program at Nationwide
"We anticipate more business owners utilizing new technologies to minimize injuries to their workers. The prediction is a new and innovative way buyers of WC insurance will start thinking about their purchasing, and that a cost commensurate with the actual exposure is recognized, with a shift to workplace safety in buying behaviors."
Life insurance tech
Kateryna - stock.adobe.com
Luis Romero, CEO and founder, Equisoft
"One of the biggest risks the life insurance industry will face is the changing workforce and the need to account for it. Many life insurance professionals — agents, brokers, sales, etc. — will be retiring, and insurers will lose all the valuable expertise and knowledge that personnel had. The result is a potential decrease in customer experience satisfaction and the need for life insurers to figure out how to continue delivering value to policyholders while continuing to upskill and train the younger generations."
New and emerging risks
Adobe Stock
"Emerging risks - environmental, geopolitical, cyber - are getting increasingly more pervasive and severe. Risks that were traditionally excluded, as well as things that didn't exist before, are now in significant demand - think about supply chain disruption or liabilities from the use of Al."