Claims to fame: the digital future of insurance?

Digitalization, automation, and regulatory shifts are re-shaping how insurers operate, engage with customers, and drive efficiency – faster than ever before.

This transformation goes far beyond cost-cutting. It’s about fundamentally changing the customer experience – delivering seamless digital journeys and a holistic view across multi-product portfolios, all in pursuit of revenue growth in a crowded sector.

As insurers embrace new technologies, the question is: how will these shifts redefine the industry in the years ahead?

The forces driving change

At the heart of this transformation is a realisation that risks are becoming more complex and customer expectations continue to shift. To compete and continue to grow in mature and crowded markets, carriers need to innovate new product solutions and enhance the value proposition offered to both retail and institutional customers. These needs coincide with the rapid evolution of a suite of tools and technologies that allow insurers to drive far richer insights from data, and more effective product distribution, in a way that wasn’t possible even five years ago.

In parallel, we’ve seen the culture of most insurance companies evolve. Where once measuring risk bred a high degree of caution, the industry now seems more comfortable with measured risks on innovation if it can see the path to growth. Similarly, regulators and governments have also become more comfortable with emerging, and digital first business models creating more space for companies to innovate within a controlled regulatory environment and offering governmental funds and support for adopting digital first strategies.

Some key trends are shaping the industry.

Automation and enhanced user experience

Digital transformation remains top of the agenda – but rather than simply reducing costs, insurers are now harnessing technology to improve both customer and employee experiences and thereby differentiate their product/service offerings. Automating underwriting decisions, claims processing, and policy management has led to faster, more accurate service provision.

Take Hiscox London Markets’ work on Gen AI enhanced underwriting models as an example: early results have reduced lead times for open-market quotes from three days to – in some cases – as little as three minutes, thanks to AI and Google’s Gemini LLM.

This transformation not only boosts operational efficiency, but also delivers a significantly improved experience for brokers, clients, and end users by making interactions faster, more transparent, and more responsive. By minimizing manual intervention, standardizing data inputs, and enabling real-time decision-making, automation reduces friction and allows users to obtain quotes with greater speed and accuracy.[1]

AXA is another example of how automation is driving operational efficiency. The company migrated its Guidewire ClaimCenter system to AWS, implemented automated workflows, and introduced AI-powered virtual agents to handle routine customer queries. This has drastically reduced claims registration and settlement times, improved cost transparency, and made customer interactions faster and more accurate across multiple channels.

By optimising processes, reducing manual tasks, and improving accuracy, automation is taking the industry to new heights of performance. Straight-through underwriting and AI-driven models are accelerating the time from data submission to quote generation by a factor of five – or more.

Consolidation and centralisation

A wave of consolidation is sweeping through the insurance sector, driven by mergers, acquisitions, and internal structural changes. Insurers are increasingly centralizing key functions to streamline operations and standardize practices.

Aviva’s acquisition of Direct Line Group, for example, is helping to strengthen its general insurance business while unlocking efficiencies of scale.

In parallel, global insurers are adopting more centralized operating models to better manage risk, ensure regulatory compliance, and improve customer service. Beazley, has shifted from a regional structure to a global, centralized model – aligning specialist underwriting and claims capabilities and to improve consistency across markets, consolidating support functions, and improving consistency across markets. The aim is to enhance scalability across its international footprint.

This kind of standardization may also pave the way for greater regulatory approval, making it easier for firms to operate transparently and efficiently across jurisdictions.

The evolving role of regulators

As insurers accelerate their digital transformation efforts, regulators are playing an increasingly prominent role in shaping how innovation unfolds across the industry. Scrutiny is intensifying around AI, data governance, algorithmic decision-making, and ethical underwriting – areas where unchecked advancement could pose risks to consumer protection and financial stability. Traditional insurers now face mounting pressure to meet evolving regulatory standards, particularly in areas such as data privacy, transparency, and cybersecurity.

Meanwhile, insurtechs – once seen as challengers to incumbents – are increasingly operating as partners. Faced with the realities of regulatory capital requirements and the importance of brand trust, many now provide agile, tech-driven solutions that enhance carriers’ operational capabilities.

In this new environment, insurers that can swiftly integrate insurtech innovation within robust, compliant frameworks will be best positioned to meet regulatory demands while improving efficiency and service.

Looking ahead: the future of insurance

The insurance industry stands at a crossroads, shaped by technological advancements, regulatory change, and shifting consumer behaviours. As insurers continue to digitalize, automate, and consolidate, they must also respond to evolving demands from consumers, employees, and regulators. Striking the right balance between innovation and compliance will be critical to ensuring that all stakeholders – from insurers to policyholders – benefit from this transformation.

From an executive search perspective, we’ve already seen these trends begin to reshape the leadership profiles the industry requires. Over the past six months, there has been a marked rise in demand for c-level digital and transformation leaders who can guide organizations through this evolving landscape.

Today’s insurers are looking for leaders who not only drive digital initiatives and ensure regulatory compliance, but also balance operational efficiency with revenue growth. This reflecting a broader shift from purely cost-focused roles to ones that support sustainable, scalable performance.

As the sector continues to evolve, investing in the right leadership will be critical to delivering successful transformation. The most effective leaders bring a track record in digital transformation, operational consolidation, and commercial decision-making. They combine strategic vision with expert communication skills, the ability to influence at every level, and a talent for navigating complexity and regulatory demands.

Those who can lead change across systems, culture, and performance – while balancing efficiency with long-term business model disruption and growth – will shape the future of the industry. We’re already seeing this shift in action, with high-profile appointments reflecting the demand for cross-sector, transformation-capable talent:

One thing is clear: the industry isn’t just changing – it’s being redefined. The firms that recognize and act on these shifts today, and sxure the talent capable of navigating them, will be the ones leading the way into tomorrow’s insurance landscape.

[1] https://www.hiscoxgroup.com/news/press-releases/2023/12-12-23

[2] https://www.accenture.com/gb-en/case-studiesnew/cloud/axa-cloud