5 Insurance trends to watch in 2024

We saw an acceleration of trends in 2023 that had been reshaping the insurance sector in previous years. Insurer players who wisely invested in technology, people, processes, and mindset gained significant traction by partnering with platforms and ecosystems, aligning with forecasts from previous years.

In 2024, this momentum is expected to continue, with particular focus on artificial intelligence's emergence as a powerful force that is transforming many industries, including insurance.

There are many, but here are 5 selected trends for 2024:

1. Platform Economy and Insurance Integration: According to a Chubb study and opinions from more than 200 Fintech experts globally, insurance has changed from being a "nice to have" to a "must-have." Insurance will become a more integral part of the offerings of industries such as Fintech, eCommerce, Mobility, TelCo, etc., with the goal of making up 10% of their total revenue. Insurance companies (whether established or emerging) that possess advanced technology, have the ability to collaborate with partners to tailor solutions for underwriting flexibility and innovation, and are capable of managing claims and services to achieve the highest NPS will thrive in this billion-dollar market. Report "Banks and the Digital Wallet Race: The Embedded Insurance Strategy" (https://tiny.cc/jaqmvz)

2. Embedded Insurance and the Rise of Phygital: The embedded insurance market, valued at USD 63.1 billion in 2022, is projected to reach USD 482.8 billion by 2032 (DataHorizon research). This approach, integrating insurance seamlessly into digital platforms and ecosystems, enhances customer adoption and engagement. Creative customer journeys that enhance both embedded and physical elements are welcome as we transition to mixed realities, combining the best elements of the physical and digital worlds. Smart journeys from offline to online and online to offline will become commonplace for more sophisticated products and offers with a "laser focus," customized for individual customers through advanced analytics.

3. Artificial Intelligence, Automation, and Advanced Analytics: 2023 marked the year of AI, with a surge in co-pilots and POCs across the insurance industry for 2024. AI, automation, and advanced analytics will scale up, offering diverse applications such as data modeling, risk prevention, fraud detection, claims automation, and virtual agents. The Insurance industry is on the path to becoming AI-centric, the key elements in owning the data and partnering with other companies to develop custom-made, data-driven propositions

4. Customer-Centric Approach and Added Value Services: Consumer expectations are high, demanding top insurance experiences similar to other industries. Insurers must reimagine products based on data, analytics, and what technology can bring. This shift is also reflected in the rise of parametric approaches, which trigger claims based on data without consumers filing claims. In 2024 and beyond, I anticipate seeing an increasing number of these propositions, which also blur the lines between wellness, prevention, and services, with the traditional insurance approach only promising to pay the claim when something goes wrong.

?5. Mergers and Acquisitions (M&A) Landscape:: M&A activity will be interesting as some insurance incumbents recognize the need to ride the wave of consumer digital distribution or risk missing out. Numbers need to be published, but despite challenges in cultural and operational integration (together with some market sees high valuations), an increase of interest rates and a market freeze on IPO I foresee M&A's and some movement towards consolidation in 2024. If there is not a clear route to profitability, obtaining early-stage funding will be difficult; everything will depend on markets and geographical areas (different stages by regions), and global statability and macroeconomics will be essential.

It's a very exciting time for forward-thinking companies and people ready to keep reimagining insurance. Looking back, in the last 10 years, the insurance industry has changed so much. Happy to connect if you are a forward thinker. At Chubb, we're committed to our partners, embracing innovation, and pushing boundaries to deliver the best end-to-end insurance opposition for millions of customers, families, and businesses on a global scale. This 2024 is going to be awesome!