AI in Insurance
AI Agents Are Thirsty for Power | WIRED
Silicon Valley is shifting away from chatbot queries toward a future filled with resource-intensive agentic AI—and it's driving the data center buildout.
“What on earth are they building all of these data centers for?” an exasperated friend asked me recently.
They’re not the only one asking: We got several similar questions on our recent data center livestream. It’s a really reasonable thing to wonder about. After all, if AI is already making all these breakthroughs, why are tech companies taking on billions of dollars of debt and constructing some of the biggest power plants in the world to build even more data centers?
The answer isn’t to help the average user search for recipes or look up places to visit on a vacation; simple chatbot queries are an increasingly outdated way of thinking about how AI works. Now, AI is all about agents—there’s no official definition, but roughly speaking, agents are large language model-based systems designed to make autonomous decisions to execute a task—and the shift towards them is part of what’s driving Silicon Valley’s power buildout.
Overcoming the AI trust gap
AI raises questions about client trust in financial decision-making. Here are a few of those questions.
Artificial intelligence is already working its way into everyday insurance operations. It can speed up underwriting, flag suspicious activity, summarize documents and help service teams respond faster. Those benefits are meaningful. But there is another question that matters just as much for advisors: What happens when a client receives an AI-influenced decision and wants to know why?
For advisors and benefits professionals, that is not simply a technology question. It quickly becomes a client-relationship question. A customer may never interact with the data provider, model developer or operations team behind an automated process. The person they know is their advisor. When an approval takes longer than expected, a risk class changes or more information is requested, the client is likely to ask, "What happened?" How that conversation is handled can shape whether the technology feels helpful or frustrating.
In Bots We Trust? For Insurance?
Accenture's Michael Reilly imagines a world in which AI agents do the shopping for personal lines insurance — a world where price may no longer determine
Executive Summary
Researchers presented different findings about the level of insurance customer trust in AI recently, with one suggesting they're warming up to the idea of using AI agents to shop and another finding the majority are still not using AI to research products and coverage. But when they do, change is likely to happen. Not only are AI users switching insurers, but Accenture's Michael Reilly believes that in the not-too-distant future, when AI agents do the shopping, they'll look at factors other than price, including claims reputation, service quality and ease-of-doing-business in making coverage recommendations. “The carriers that thrive will not necessarily be the cheapest. They will be the ones that make their real value—claims, service, ease, integrity—as easy for a machine to find and trust as it is for a person to admire,” wrote Reilly, who is managing director for insurance consulting and operations at Accenture, in a report titled, “When the Customer Sends a Bot to Shop.”
Acrisure bets on Palantir to reshape insurance workflows
Acrisure, the global FinTech group spanning insurance, reinsurance, payroll, benefits, cybersecurity and real estate services across 19 countries, has launched Auris AI, an applied artificial intelligence platform developed with Palantir Technologies to bring together data, workflows and decision-making across its business.
Built using Palantir’s Ontology framework, Auris AI brings client records, carrier relationships, contract details and operational data into a single environment, with permissions and controls designed to govern how information is accessed and used.
The platform gives insurance teams a shared view of client intelligence, growth opportunities, risk insights, placement activity and service requirements, helping employees identify opportunities, coordinate work and respond to clients without relying on fragmented systems.
AI Data Centers Are on Track to Fuel ‘Explosive’ Growth in Captive Insurance
A form of self-insurance often associated with mining, oil and other environmentally risky sectors is quietly transforming the market for physical-risk coverage, thanks to the rise of mega AI data centers.
A form of self-insurance often associated with mining, oil and other environmentally risky sectors is quietly transforming the market for physical-risk coverage, thanks to the rise of mega AI data centers.
Captives — whereby firms sidestep traditional insurers and instead set up their own in-house insurance - is emerging as a go-to coverage model for the infrastructure around artificial intelligence, according to Michael Serricchio, US and Canada captive solutions leader at Marsh, the world's biggest insurance broker.
"What you're going to see is an explosive growth in the use of captives to take on the portfolio risks for data centers," Serricchio said in an interview. "Inadvertently, some of the risk for build-outs, construction, surety, property and liability will end up in their captive." He declined to provide details of individual companies, noting the sensitivity associated with such deals.
News
AI could make humans extinct say researchers
A researcher quits, a colleague backs him up on X, and within days half of Washington is talking about AI wiping out humanity. It's the kind of story that's easy to file under tech-industry theatre and move on.
"It doesn't matter whether we're talking about insurance or personal finance or the price of bananas, you get to AI very, very quickly," Matthew Hill, CEO of the UK's Chartered Insurance Institute, told Insurance Business.
"And, while one might be a little bit cynical about the stories in the press in the last few days about that have come out from Anthropic and the 10% chance that AI will extinguish life within the decade [that] could just be linked to their forthcoming IPO," he continued.
US insurers probably shouldn't just move on, though. Underneath the apocalyptic headlines is a much narrower, much more practical question that the market has already started pricing: what happens to liability, governance and underwriting when AI systems start building the next generation of AI systems with less and less human oversight?
Financial Results
Reinsurers Post Second-Best First-Half Return In A Decade As Excess Capital Mounts
Reinsurers posted their second-best first-half return in a decade in 2026, even as premium volumes shrank and capital kept building, according to Gallagher Re’s September 2026 Reinsurance Market Report, as reported by Risk & Insurance.
By the numbers: - Return on equity hit 19.9% in the first half, prompting Gallagher Re to raise its full-year ROE estimate to 16.5%-17.5%. = Total reinsurance capital rose 5% to $688 billion, while P&C reinsurance premiums fell 6%. = Combined ratio improved to a record 85.8%, though the underlying figure, stripped of catastrophe losses and reserves, worsened to 84.7%. - Natural catastrophe losses totaled at least $46 billion, down from $84 billion a year earlier and 28% below the 10-year average.
State News
LA County opens investigation into Farmers over wildfire claims handling
County lawyers allege the carrier stalled on toxin testing and remediation payouts for Eaton and Palisades fire survivors, making Farmers the second major insurer to face county action this year
Los Angeles County has announced a civil investigation into Farmers Insurance Company, alleging the carrier failed to properly compensate policyholders whose homes were damaged in last year's Eaton and Palisades fires. County lawyers laid out the allegations in a letter sent to Farmers on September 9, warning the insurer to halt any unlawful practices immediately.
The county's Office of County Counsel said the inquiry will test whether Farmers breached California's Unfair Competition Law through delayed payments, denied claims, and underpayment of survivors whose homes were left standing but contaminated by smoke, ash, and toxic debris.
Climate/Resilience/Sustainability
Farmers Insurance® Urges Preparedness as NOAA Forecasts Potentially Historic El Niño for Fall and Winter
Farmers Insurance® is urging households and businesses to prepare now
National Oceanic and Atmospheric Administration (NOAA)warn that the developing El Niño has a greater than 90% chance of becoming very strong this fall and winter1. NOAA also reports a 69% chance the event could exceed the strength of every El Niño measured since 19501 – raising the likelihood of typical El Niño impacts while offering an important reminder to review insurance coverage and reduce risks before severe weather develops.
"National Preparedness Month — and the possibility of a historically strong El Niño — are important reminders that preparation should happen before severe weather enters the forecast," said Bobby Massey, Head of Catastrophe Claims at Farmers®. "Our catastrophe claims teams see how quickly storms can disrupt lives, but also how preparation can support recovery. Reviewing coverage and deductibles, documenting property and addressing risks around the home now can make a meaningful difference after a loss."
InsurTech/M&A/Finance💰/Collaboration
Dell's DFO Management and Sequence to take Baldwin private in $7.7 billion deal
Michael Dell's DFO Management and Sequence Holdings said on Monday they would take the Baldwin Insurance Group (BWIN.O) private in a deal valued at $7.7 billion.
Under the terms of the deal, Baldwin shareholders will receive $32.50 apiece in cash.
The offer represents a premium of about 88% to the stock's closing price on June 17, the day before media reports emerged about a potential go-private deal, the companies said. Baldwin shares were up 6.9% at $31.69 in premarket trading.
Baldwin, valued at around $4.14 billion, provides risk management solutions, insurance advisory and tech-enabled underwriting to businesses and individuals.
Fraud
ALTA Study Finds Seller Impersonation Fraud Attempts More Than Double
The American Land Title Association (ALTA), the national trade association of the land title insurance industry, today released new research showing seller impersonation fraud has become more widespread and frequent, while criminals are broadening their targets and using increasingly sophisticated tactics to carry out these schemes.
ALTA's 2026 Seller Impersonation Fraud study found that 59% of firms reported at least one seller impersonation fraud attempt in the prior calendar year, more than double the 28% reported in ALTA's 2024 survey. Seller impersonation fraud occurs when a criminal impersonates a property owner to illegally sell commercial or residential property.
Recommended Events
Register: AI Tools for FNOL & Digital Claims Intake ‘Demo Day’ on September 16
Insurance Journal's Risky Future series is hosting the "AI Tools for FNOL & Digital Claims" Demo Day, a series of free AI tool demonstrations designed
Register: AI Tools for FNOL & Digital Claims Intake ‘Demo Day’ on September 16
Insurance Journal’s Risky Future series is hosting the “AI Tools for FNOL & Digital Claims” Demo Day, a series of free AI tool demonstrations designed exclusively for insurance claims leaders, including chief claims officers, innovation & transformation leaders, customer experience leaders, claims managers and more.
This event will spotlight solutions that aim to change the First Notice of Loss (FNOL) and digital claims intake experience. Live back-to-back demos will show how to streamline the claim submission process, automate workflows, capture photos and documents more efficiently while improving customer communication and accelerating claim routing, and processes to identify fraud earlier.