Digital Insurance contacted insurance professionals to comment on what they see for insurtech in 2025.
Generative AI will continue to be deployed in several areas across the insurance industry including underwriting, claims and customer service, experts suggest. As more data is gathered from the Internet of Things (IoT) there is also room for better risk assessment and potential loss prevention insights. However, challenges persist related to regulatory compliance, data quality and leveraging these new technologies effectively.
Responses have been lightly edited for clarity.
Megan Wood, president of Genius Avenue
Insurtech will finally focus on improving the user interface (UI) and user experience (UX). Insurtech has impacted the insurance and benefits market in many ways. 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 compared 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.
Rashid Galadanci, CEO and co-founder of Driver Technologies
The insurance industry is still in the early stages of utilizing connected car data effectively for pricing policies. 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.
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.
Leandro DalleMule, general manager of Planck / Applied Systems
I predict 2025 will center on agentic AI, where AI acts as an active agent performing specific tasks beyond just offering recommendations. Instead of generating suggestions, agentic AI can handle actions (like purchasing items for events). I see this level of automation extending to underwriting and other insurance tasks, where AI will execute processes, provide options, and handle associated logistics and issues.
AI's primary impact on customer experience soon will be on improving customer service by eliminating long wait times and providing quicker responses. AI can handle routine inquiries and offer immediate solutions, which will enhance customer satisfaction. Product enhancements will likely follow but require more complex integration.
Overall, better service is the first and most visible improvement expected for customers. I question whether regulators can keep pace with AI's rapid developments, given the speed of change in the field. I think industry self-regulation is more of an immediate solution, creating internal standards while waiting for formal regulations. While general mandates (like Biden's executive order) outline high-level principles, they lack specifics. Even in Europe, strict regulations are sometimes ineffective, as illustrated by recent Apple product issues.
Darcy Rittinger, chief risk officer, Cover Genius
AI is still new technology, so while it can be an incredibly powerful tool that can improve various aspects of insurance, companies must proceed with caution, especially in areas where they are providing consumers with information or advice regarding insurance products.
Companies should remain aware of data considerations, such as customer consent and data ownership when implementing AI measures. By carefully weighing the benefits and risks associated with AI adoption, insurance and insurtech firms can harness the full power of this groundbreaking technology while minimizing potential pitfalls.
Bill Martin, president & CEO at Plymouth Rock Assurance
I am hoping that in 2025, the broad population gets excited at the idea that AI can be used to reduce potential bias and eliminate errors made by carriers and underwriters.
In the insurance world, technology can make more objective decisions about underwriting risk than humans. In the world of safety, thousands of deaths and injuries can be prevented if we accept the better judgment of AI to replace the much more fallible judgment of humans. Think of how many roadway deaths can be saved today with automated driving systems which are improving every minute. Are we really unwilling to save those lives because we are willing to allow humans to get a decision wrong, but not AI?
At some point, the idea that AI is a job killer or a biased arbiter will give way to the exact opposite – it makes the quality of our work better and helps us focus more on critical thinking than rote repetition.
Rachel Switchenko, VP of customer solutions at Plymouth Rock Assurance
We're just at the tip of the AI iceberg.
The industry is learning together, but the companies that find ways to use AI to solve bigger opportunities than the run of the mill efficiency conundrums will jump ahead in how they are adding value, imagining the unimaginable, disrupting the industry, etc.
Ian Drysdale, CEO of One Inc
The global AI in insurance market is projected to increase by more than 55% between 2022-2032, reaching up to $79.86 billion (
As such, AI will transform the underwriting and claims processes, with the technology providing quicker analyses to speed up workflows and assessments. Faster, digital payments complement this expedient underwriting and adjudication of claims.
Ken Tolson, CEO, Turvi
As the P&C industry strives to differentiate in 2025, Gen AI will rise in importance. As differentiation remains a top priority for P&C carriers and brokers seeking to capture market share, investment in technology that is innovative and enhances the customer experience will be key in 2025.
Notably, we'll see an accelerated integration of embedded Gen AI solutions across the entire P&C value chain. This shift will mark a move from pilots and proofs-of-concept to production-ready, fully implemented products that will transform the way and speed with which the ecosystem performs.
Bill Pieroni, CEO, ACORD
IoT is now a well-established technology that's embedded and delivering value for leading carriers globally – we will see a widening performance gap between those leveraging it and their competitors. AI will continue to have impact across the industry, but over a longer horizon than some early adopters are anticipating.
The initial focus of most stakeholders will be on cost take-out, but AI will ultimately have a transformative effect across almost every part of the enterprise. Effective adoption takes time, so it's imperative to start now.
Tom Rasmussen, VP of product, claims at Carpe Data
In 2025, the most successful insurers will dial it back to adopt a more balanced, strategic approach, zeroing in on areas of the business that deliver the highest ROI. This could mean automating manual, time-consuming tasks while keeping a human-in-the-loop on the larger decision-making tasks.
Successful AI adoption isn't about being the most innovative, it's about being innovative in the right ways. Insurers need to be intentional about how they're implementing AI across their business, ensuring they're balancing moving the innovation needle forward with realistic business value.
Garret Gray, president of global insurance solutions at CoreLogic
In the near future, we expect to see the industry leveraging Insurtech solutions that can reliably perform image-to-scope—automatically generating a "scope of work" for insurance claims estimates. This is made possible by the expansion of AI, specifically multimodal AI. These systems can evaluate property images, pinpointing where structural damage has occurred, and will soon be able to analyze the type of damage in the image, and assess the severity of destruction. With more advanced AI available to insurers, it will become increasingly important for industry operators to collaborate with digital solutions vendors they trust to harness the full potential of multimodal AI.
Mike Allee, president, UCT
IoT has finally reached a critical mass in the insurance sector. While life insurance continues to lag in the technology's adoption, in 2025 the vital data it can provide along with its scalability will provide compelling business cases for IoT investment and expansion alongside AI.
Jason Kaminsky, CEO of kWh Analytics
Underwriters will begin to use AI in ways that demonstrate bottom-line advantage in 2025. For nonstandardized and complex specialty segments such as renewable energy, AI will serve as an efficient digital assistant for underwriting teams, streamlining document review and data organization.
MGAs that are able to invest in building AI solutions with an eye toward innovation and scalability will have a long-term advantage in achieving operational efficiency, better customer experience, and better underwriting results.
Adam Denninger, Capgemini's global industry leader for insurance
The industry in all sectors is facing a severe gap in digital capabilities. This is true everywhere from direct-to-consumer retail businesses, to complex commercial, to the group benefits and medical space. The digital needs are drastically different by business sector, of course – customer sales portals in some businesses, member self-service capabilities in others, and complex agent experiences in others – but in all cases insurers are facing pressure to fix sub-par capabilities.
The technology itself is not new or particularly innovative to industries outside of insurance – it is just that (on average) insurance is lagging well behind what customers and distribution partners expect, and far behind on the operational savings companies could achieve with modern tech. I am seeing a wave of focus and interest in true digital modernization; I think this will be a leading technology trend throughout 2025.
Coleman Johnson, SVP, Chief Underwriting Officer at The Mutual Group
The contrast in results between the "haves" and "have nots" in insurance is growing more stark every year. AI and advanced analytics has the potential to accelerate this distinction very fast in the next several years. Large carriers are finding proof cases in leveraging AI and analytics in distribution, underwriting and claims to drive lower costs, ease the process of doing business, and support more effective decision making.
Whether you're a large stock company or a small mutual, you need to prioritize investments in building these capabilities now or the window to close the innovation gap with your competitors is going to close fast.
Craig Schedler, VP of venture and corporate development, Northwestern Mutual Future Ventures
I am cautiously optimistic about venture capital opportunities within the insurtech space next year. In particular, VC investors will be attracted to companies leveraging Gen AI with clearly identified use cases that solve real pain points. With Gen AI, specifically, it will be important for startups to quickly demonstrate actual return on investment.
Within Northwestern Mutual Future Ventures, we're working with our portfolio companies to apply emerging technology to deliver the increasingly exceptional and seamless experience our clients are looking for.
John Riggs, CTO and SVP of Applied Technology Solutions for HSB, a specialty insurer and provider of technology services, and part of Munich Re
In 2025, insurance is expected to continue to be profoundly shaped by advancements in IoT Gen AI, particularly in areas like climate-related insurance, equipment monitoring, smart businesses and homes, enhanced risk assessment and operational efficiency. These technologies will play a pivotal role in transforming how insurers manage risk, process claims, and tailor products to individual needs. While all of these are significant and critical, the one which represents the greatest potential/impact is smart businesses and homes.
IoT is becoming a crucial tool for managing climate-related risks. With the increasing frequency of extreme weather events due to climate change, insurers are leveraging IoT sensors to monitor environmental conditions in real time.
Generative AI is transforming the insurance industry by enhancing customer interactions, improving underwriting processes, and enabling more sophisticated risk modeling—especially as it relates to climate change.
Katie McGrath, CEO of North America at Swiss Re Corporate Solutions
We expect Gen AI to have both an immediate and lasting impact on the insurance and reinsurance sector as the technology can help to address some key industry specific challenges such as consumer engagement, high operational cost, and comparatively slow pace of digital disruption. Commercial UW in particular, has a high prevalence of unstructured data and manual workflow, making it a fit for the efficiency benefits that Gen AI might deliver.
At the same time, internal, broker supplied, and external data sources are abundant and growing – yet the industry's processes have been slower to be able to leverage and incorporate these into the underwriting processes. Costing tools and workbenches still take time to update and change. We are excited about the potential of AI to help speed up the pace of change and reduce transaction times across the UW value chain.
Ultimately, AI will only be as good as those people who develop and utilize it, and the quality of the underlying training data. The added value of AI therefore comes from the smart combination of both AI models and human processes.
Chetan Kandhari, chief innovation & digital officer, Nationwide
Advances in Agentic solutions, the spectrum of AI capabilities within the connected and IoT world will continue to significantly amplify capabilities offered by insurtechs in 2025. Combined, these technologies can revolutionize data collection, lower the cost of prediction, improve the quality of prediction, policy pricing, and customer interaction. AI is already transforming claims processing by analyzing text, images, and voice recordings to help validate claims and predict outcomes and assist adjusters in daily tasks.
IoT sensors can actively prevent losses, but also automatically alert both the homeowner and insurer of fire, water leaks and security breaches. Leveraging these proactive notifications can both reduce claim severity and significantly reduce processing time. Nationwide envisions a future where connected vehicles and homes enable insurers to proactively offer assistance, initiate the first notice of loss, and update policy changes ultimately preventing losses and delivering on our mission of extraordinary care and vision of being the most customer focused Insurance company.
Haden Kirkpatrick, VP of innovation & venture capital at State Farm
I believe the continuous evolution and advancement of IoT, Generative AI, and other emerging technologies will offer carriers more opportunities in 2025 to better predict and prevent losses via the use of home telematics and other advanced technological solutions.
In addition to relationships we have with ADT and Whisker Labs (Ting), we are progressively exploring opportunities with insurtech startups and other service providers to help customers better manage and protect their homes, and to continue delivering on our mission to help more people in more ways.
Suhas Sethi, global business leader for insurance at Genpact
We'll see the industry lean a lot more into generative AI to help predict and quantify risks and keep claims costs down with more accurate indemnity and faster speed to settle, as they look to balance the challenges of high inflation, supply chain disruptions and the rise of extreme weather.
For insurers to extract the full value of gen AI, they must first establish a strong foundation of high-quality data that is reliable, flexible and accurate – and processed in real-time. This data set-up is required for gen AI models to be able to predict scenarios and generate actionable recommendations that get better over time.
Michael Moran, COO of Trucordia
AI is powerful but it still requires more feasibility testing for highly regulated industries like insurance, especially around quality, accuracy, and errors and omissions. Therefore, we expect widespread applications primarily in back- and middle-office functions, like finance, IT or marketing, that use data and/or rules for policy-checking, targeting prospects or client support, as a few examples.
We're taking this approach at Trucordia. In response to our clients' needs and expectations, we will continue integration of our own Generative AI technology into the coming year as a tool to help our teams to do their jobs more efficiently—not as a wholesale replacement of jobs or responsibilities. We're using AI to provide clean data and generate and extract content, to ensure we're leveraging industry and proprietary data to help our clients better understand and address their most important risks based on their specific risk profile—including industry, location and loss history. In addition, by automating routine tasks, we're empowering team members to focus on advising and providing tailored solutions for clients at scale.
My prediction is that the greatest long-term opportunities for advancement in the insurtech space will lie in:
Risk identification and selection: AI will help create hyper-relevant content across lines of business within minutes, increasing the industry's ability to create more tailored products, especially for what are currently hard to place risks, as we better identify homogeneous risk pools.
Operational efficiencies throughout the insurance value chain: AI will transform how data from the plethora of systems is classified and standardized, further increasing client value.
More efficient matching of risk to capital: Insurance professionals will be supported by AI-enhanced search and matching tools that will help them find the optimal capital for their clients' risk needs.
Peter McMurtrie, insurance practice leader at West Monroe
In 2025, the industry will turn to AI and Gen AI to address various pain points, including the demand for greater personalization, increased risk complexity, and the need to lower operating costs amid rising loss cost trends.
While many carriers have rushed to deploy Gen AI solutions to appear proactive, more disciplined carriers have focused on true value creation by investing in the underlying data and technology infrastructure. This enables them to deploy robust and impactful solutions across underwriting, claims, and servicing. IoT devices and data will play a key role in connected home devices, telematics, and wearables. However, disciplined carriers will advance in performance, while those pursuing quick, superficial wins will fall behind.
