The insurance industry is set to be defined by the transformative impact of artificial intelligence (AI), environmental, social, and governance (ESG), and cyber risk management in 2025. As consumers increasingly embrace AI-driven solutions and express growing interest in personal cyber coverage, insurers face both challenges and significant opportunities to innovate, personalize offerings, and integrate emerging technologies like electric vehicles (EVs) and Internet of Things (IoT), says GlobalData, a leading data and analytics company.
Emerging Trends in Insurance
GlobalData’s 2024 Emerging Trends Insurance Consumer Survey reveals that global consumers are open to trying AI tools in all areas of the value chain, do care about sustainability, and are interested in personal cyber insurance policies.
Our survey highlights generally positive attitudes towards using AI tools to determine premiums, finding that 43% of global users are either quite or very comfortable using such tools. Regional variations exist—for example, Chinese consumers are the most open to this technology, while Australians are least open—but insurers should be utilizing them in every geography.
The Role of AI and ESG in Insurance
Ben Carey-Evans, Senior Insurance Analyst at GlobalData, states: “Enough consumers are already comfortable with AI tools that they can provide an effective (and 24/7) channel of communication, thus reducing stress on phone lines and email accounts.”
ESG is already a central part of insurers’ strategies, but this is expected to continue growing over the next decade. Consumer demand will be central in the insurance industry’s fight against climate change. Over half (51.3%) of global consumers believe insurers have a role to play, while 20.6% remain unsure.
Cyber Insurance and the Rise of IoT
Cyber insurance is a significant theme, but personal cyber coverage remains underdeveloped. However, there is potential in this space, with 26.4% of consumers interested in acquiring personal cyber insurance. This interest is especially strong among 18–24-year-olds, where 36.7% would consider purchasing a personal cyber policy.
Survey data also shows that 31.6% of combustion vehicle owners plan to transition to EVs within two years, and 67.7% within the next decade. Additionally, 54.5% of consumers are open to buying insurance directly from manufacturers. This presents both challenges and opportunities for insurers.
IoT plays a growing role in insurance by enabling the collection of personal data via connected devices, particularly in motor and health insurance. The survey found that 37.8% of global consumers use an activity tracker to monitor their health daily, presenting a valuable opportunity for insurers to engage with customers through tailored rewards-based programs.
Conclusion
Carey-Evans concludes: “The shift towards EVs demands innovation in underwriting and risk assessment, while IoT offers a chance to enhance personalization through data-driven insights. By embracing these trends, insurers can tailor offerings, increase customer engagement, and stay competitive in a rapidly evolving market.”
