AI in Insurance
Reimagining Risk in an AI-Driven World | Insurance Thought Leadership
AI agents can deliver transformative gains, but only for firms prepared to rethink governance, decision rights, talent, and data strategy.
What if we have been looking at AI from the wrong angle? What if it is not a magic fix for the insurance industry’s legacy issues but is an unlock for the next generation of growth through insurable risks?
AI is emerging alongside forces already reshaping the global risk fabric: the rise of intangible assets and cyber exposure, mounting climate volatility, shifting global demographics, and an entirely new class of technologies. These are not distant scenarios, they are today’s realities.
The IIS Innovation Report reflects an industry in transition, a theme underscored during our executive working group session at the Swiss Re Centre for Global Dialogue in Rüschlikon. Leaders recognized that early AI efforts often focused too narrowly on efficiency and missed the broader strategic opportunity emerging across the global economy.
The discussions made it clear that the next decade will divide the sector between organizations making marginal improvements and those rebuilding their operating models around proprietary knowledge graphs, reengineered data flows, and augmented human judgment.
These foundations enable stronger risk selection, superior service performance, and loss prevention in a far more dynamic risk environment, while preserving what remains fundamentally human in our business: trust, advice, and long-term client relationships. AI agents can deliver transformative gains, but only for firms prepared to rethink governance, decision rights, talent, and data strategy.
This is the strategic inflection point. If we mobilize for it, insurance will not simply adapt, it will become one of the defining stabilizers of an increasingly connected and AI-enabled world!
George Kesselman
Allianz Built an AI Agent to Train Claims Professionals in Virtual Reality
Allianz Built an AI Agent to Train Claims Professionals in Virtual Reality
One thing that experienced adjusters will probably tell you about learning to be a better claims handler is to get more…well…experience. Years and years of it.
Multinational financial services and insurance giant Allianz is looking for a way to accelerate that experience-getting process for claims novices and experienced professionals.
At its extensive North America operations, the company is experimenting with an artificial intelligence agent in virtual reality to speed up and improve a process that has historically entailed a training stint followed by years of on-the-job learning.
To get a good handle on what Allianz is doing with AI, Claims Journal spoke with Melissa Hill, regional head of claims for Allianz Commercial in North America. INTERVIEW
News
Winter Storm Fern comes with billion-dollar threat to property insurers - Insurance News
Winter Storm Fern is gathering power and set to unleash potentially billions in property damage and devastation across middle America.
The weekend storm is forecast to impact nearly 75 to 150 million people across a 700,000-square-mile area from the Southern Plains to the Northeast. Beginning with rain Friday across Texas and Oklahoma, creating potentially lethal ice conditions, the storm is expected to track east and finish with a massive snow dump across several eastern states Sunday and Monday.
Forecasters predict it could be the most significant winter storm in at least a decade. The storm will most certainly be accompanied by significant insured property damage.
Neil Alldredge is president and CEO of the National Association of Mutual Insurance Companies. The property insurance industry as a whole is navigating a "new era of risk" that tests its ability to handle multi-billion-dollar catastrophic weather events, he said.
“While the industry has historically shown resilience, the increasing frequency and severity of natural disasters – combined with economic inflation and rising litigation – have created a volatile, high-pressure environment,” Alldredge added.
US P&C industry set for lowest net combined ratio in over a decade: Triple-I/Milliman
The US property & casualty (P&C) insurance industry is forecast to have its lowest net combined ratio (NCR) in over a decade for the full year 2025, despite the devastating California wildfires in Q1’25, supported by an Atlantic hurricane season that did not make landfall in the US.
Insurance Information Institute (Triple-I) The findings are based on Insurance Economics and Underwriting Projections: A Forward View, a recent report from the Insurance Information Institute (Triple-I) and Milliman.
The report noted that the US P&C insurance industry demonstrated resilience throughout 2025, despite significant regional catastrophes, ongoing tariffs, and other geopolitical risks.
“Overall, the P/C insurance industry and the broader U.S. economy remain stable,” said Michel Léonard, Ph.D., CBE, chief economist and data scientist at Triple-I. “However, despite stronger-than-expected GDP growth in the third quarter, a closer look at the data suggests the U.S. economy may be increasingly vulnerable to rising economic, political, and geopolitical uncertainty. In particular, P/C replacement costs could still see significant increases in 2026, weighing on overall P/C performance.”
Léonard added that a rise in the unemployment rate toward the critical 5.0% level over the next six months could trigger an economic contraction or even a recession.
State News
Security First Latest Florida Insurer to Roll Back HO3 Rates
Hot on the heels of a significant rate cut in December, Florida’s Security First Insurance has announced another average decrease for one of its homeowners products.
The use-and-file decrease will average about 5.2% for the carrier’s Signature+ HO3 policies, a product launched last Spring. And starting in May, those policyholders renewing policies for the first time will see a 20% reduction in all-peril and water deductibles, the company announced. The reduction follows an 8% average decrease for Security First’s legacy Signature HO3 policies, a product that is no longer available to new policyholders. STORY CONTINUES
Washington insurance restitution bill clears Senate
Insurance Commissioner Kuderer noted that Washington's current fine schedule is an outlier in the U.S.
What You Need To Know - The bill grants the state insurance commissioner the authority to require a person or company violating insurance laws to pay restitution to affected policyholders. - Senate Bill 5331 was requested by Washington State Insurance Commissioner Patty Kuderer, with - -Sen. Adrian Cortes, D- Battle Ground, serving as the prime sponsor. - SB 5331 will now go to Washington’s House Consumer Protection & Business Committee for consideration.
The bill grants the state insurance commissioner the authority to require a person or company violating insurance laws to pay restitution to affected policyholders. The Office of the Insurance Commissioner’s ability to fine would include all insurance entities regulated by the office.
“As the consumer watchdog, people expect us to help them when they’ve been harmed by a company they’ve trusted,” Kuderer said in a release. “They expect us to be able to make them whole.”
Kin Introduces Auto Insurance, Bringing Bundled Savings to Homeowners in Florida and Texas
Kin, the direct-to-consumer digital home and auto insurance and finance provider, today announces the launch of auto insurance for Kin customers in Florida and Texas. For Kin home insurance policyholders, the new auto insurance offering allows customers to bundle their policies for simple policy management, comprehensive protection, and substantial cost savings.
Bundled home and auto policies can save customers as much as 20% on auto policy premiums. This is particularly helpful for homeowners who are looking to cut costs in 2026 and beyond.
"Our customers in Florida and Texas told us they wanted the ability to bundle auto and home insurance, so we made it a priority to bring this product to market," said Kin Founder and CEO Sean Harper.
Legal System Abuse/Social Inflation
Third-Party Lawsuit Funding Costs U.S. Economy Billions, Report Finds – DC Journal - InsideSources
As the Trump administration makes lowering costs for American families a central goal of its economic agenda, a growing body of research is pointing to a largely overlooked contributor to higher prices across the economy: third-party litigation funding.
Third-party litigation funding (TPLF) allows outside investors to finance lawsuits in exchange for a portion of any settlement or court award. While once confined to niche commercial disputes, the practice has expanded rapidly in recent years, turning the United States into the global epicenter of litigation finance — and, critics argue, magnifying its economic consequences.
According to research from Swiss Re Institute, the U.S. generates 25 percent of global GDP but now accounts for more than half of all third-party litigation funding activity worldwide. Many of these funded verdicts and settlements exceeded $5 million. Industry estimates place the global litigation-funding market at roughly $19 billion in 2024, with projections suggesting it could grow to more than $50 billion within the next decade.
Research
What's Really Driving the Rise in Bodily Injury Claim Frequency? A Closer Look at an Unexpected Trend | CCCIS
By Erik Bahnsen – Director of Industry Analytics
The last two years, something unusual has been happening inside Personal Auto. While most major lines of business have seen claim frequency drift downward, Bodily Injury (BI) is the outlier.
At first glance, the trend is counterintuitive. Property damage exposures are falling. Collision claims are falling. Even personal injury protection (PIP), another injury line of business, is moving in the same downward direction. Yet BI continues to climb.
That divergence matters. With per-exposure indemnity costs rising at 3-4 times the rate of general economic inflation (Figure 2) – and BI claim frequency rising in parallel – bodily injury now accounts for 52% of total liability claim dollars paid, despite representing less than one in four property damage exposures. (Figure 3) It's a new high-water mark for a line already vulnerable to overpayment risk tied to unrelated, unverified, or inflated injury claims.
Announcements
Insurity Launches Expanded Partner Program to Support Scalable Growth
The new initiative aims to streamline collaboration and support implementation, integration, and go-to-market efforts across more than 200 partners.
Insurity (Hartford, Conn.), a provider of cloud-based software for the property/casualty insurance industry, has introduced an expanded partner program to enhance collaboration with more than 200 system integrator, technology, and insurance services partners.
The program is designed to better align partners with Insurity’s fastest-growing product areas, providing earlier engagement in sales cycles and a more structured framework for delivery and revenue execution. It also introduces certification paths, account mapping, opportunity routing, and standardized implementation playbooks to improve consistency across partner engagements.
System integrator partners will gain expanded opportunities for involvement in implementations, data migrations, managed services, and multi-phase engagements. Technology and services partners will benefit from updated integration frameworks and joint go-to-market opportunities.
Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter
Telematics, Driving & Insurance
Data Driven Auto Insurance: Transforming Coverage -
The balance between privacy and data sharing is a tricky one, but as consumers get used to smartphone apps, TVs and even fridges tracking their every move the concept of getting cheaper car insurance via personal data, is slowly catching on.
Here’s the word from Arity;
Recent consumer research by the global insurance think tank IoT Insurance Observatory in partnership with the mobility data and analytics company Arity reveals five critical insights about telematics that every data-savvy auto insurance leader should understand. Taken together, they illustrate the potential of telematics to transform your business, today and tomorrow.
Fraud
Coalition Against Insurance Fraud Names New Insurer Co-Chair, Re-Elects Officers - CollisionWeek
The Coalition Against Insurance Fraud has appointed Steven Piper as insurer co-chair and re-elected John Sokit as treasurer, the organization announced Jan. 15.
The Executive Committee and Board of Directors approved the appointments at the coalition’s annual meeting in Arlington, Va.
Piper, assistant vice president and global head of special investigations at CNA Insurance, will serve a two-year term. He replaces David Rioux, vice president of investigations and internal controls at Erie Insurance Group, who served as insurer co-chair from 2020 to 2025.
“Steve has consistently demonstrated thoughtful and collaborative leadership within the Coalition, so he is an excellent choice to lead our mission forward,” said Michelle Rafeld, coalition executive director.
Sokit, assistant vice president of property and casualty recovery operations and special investigations at Nationwide Insurance, was re-elected to a two-year term as treasurer.
Anna Flores, executive director of Consumer Action, along with Piper, Sokit and Rioux, were re-elected to the Executive Committee for four-year terms.