Earnix has published its third annual 2024 Industry Trends Report, revealing evolving priorities and pressing challenges within the insurance industry. Based on responses from over 400 insurance executives, the report sheds light on the sector’s increasing reliance on AI, ongoing modernisation struggles, and rising regulatory demands.
According to the report, AI deployment in insurance is set to expand significantly, with 70% of respondents planning to implement AI models that use real-time data predictions within the next two years. This projection marks a notable increase from the current adoption rate of under 30%, indicating that real-time predictive analytics are becoming central to business strategies in the sector.
The report also emphasised the growing compliance challenges facing insurers. More than half of the executives reported that their companies incurred fines or issued refunds due to operational errors in the last year, an outcome that may be contributing to a rise in compliance-focused activities. Over two-thirds (70%) of respondents indicated they expect to allocate more time to regulatory compliance in the coming year.
Aaron Wright, director of strategy at Earnix, emphasised the importance of adopting real-time AI models to “increase collaboration and innovation” in meeting regulatory standards.
Despite the prioritisation of AI and regulatory alignment, operational bottlenecks remain. The survey found that 58% of companies take over five months to implement a rule change, with 21% reporting timelines longer than seven months. Additionally, 49% of respondents acknowledged their firms are behind in updating legacy systems.
“This year’s survey reveals the rapid use of AI, a five- to seven-month average deployment of rule changes, as well as struggles with modernisation,” said Robin Gilthorpe, CEO of Earnix. “Macroeconomic conditions such as inflation, climate change, cybersecurity risk, and uncertain economic conditions will also continue challenging insurers.”
The 2024 Industry Trends Report was conducted by Earnix and Market Strategy Group, LLC, surveying 431 insurance executives across various global regions, including the US, Canada, Europe, and Australasia. Participants represented roles spanning actuarial, analytics, product management, C-Suite, and IT.
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