Prescriptive Analytics alone will generate more than $100bn in fresh premium by 2030, according to the re/insurance broker.
A report from Aon lays out some of the technology opportunities that lie before the insurance sector.
The re/insurance broker’s “Transformative Trends Report” reveals growth opportunities for insurers across evolving risks with estimated time horizons to help them make better decisions to protect and grow their business.
The study reveals the top 10 growth opportunities for insurers to respond to customer demand while increasing the industry’s relevance, growth and diversification.
Prescriptive analytics represents the single largest megatrend re/insurance opportunity, according to Aon’s report, with potential gross written premium (GWP) expected to exceed $100bn by 2030.
This technique, reliant on advances made in artificial intelligence, applies machine learning and data influx to provide actionable insights, with authority to make automatic decisions.
The paper’s findings are the result of analysis by Aon’s strategy and technology group, of several global industry trends and global market size, combining Aon’s proprietary research with third-party sources and interviews with sector specialists.
Prescriptive analytics require careful consideration and planning by re/insurers “to seize the opportunity and mitigate the risk”, Aon observed, being linked to multiple overlapping trends.
The second biggest growth opportunity identified is shared mobility – which includes shared autonomous vehicles, hailed vehicles, car sharing and air taxis with a potential to exceed $40bn in GWP by 2030.
Intellectual property (IP) and the Metaverse could each generate in excess of $20bn in GWP by 2030, the former driven by a global economic shift from tangible to intangible assets, which were estimated to have reached around $60 trillion in value in 2022.
“These megatrends each equate to risk and opportunity for the global insurance industry, and so as risk experts we cannot afford to sit on the sidelines and wait for these trends to crystalise,” said Sherif Zakhary, CEO of Aon’s strategy and technology group.
The study outlines further growth opportunities for insurers, including carbon capture, carbon asset decommissioning, nature-based products and biodiversity, biotechnology, electrification, and so-called “build back better” resilient infrastructure development.
Zakhary added: “We have the technology and ability to anticipate the future landscape and develop innovative products and solutions to enable stakeholders to fulfil their biggest needs, from accessing new forms of capital to navigating emerging volatility. In order to accelerate this innovation, insurers must attract a broader range of talent and make use of cutting-edge technology, including advanced analytics.”