This year’s most-viewed insights from McKinsey’s Insurance Practice collectively take stock of emerging trends and offer perspectives on how insurers can compete, evolve, and increase their relevance in the next normal. Three major themes emerge: the urgency of technology modernization, the impact of climate change, and the imperative of effective business building.
On technology and digital trends
Insurance 2030—The impact of AI on the future of insurance
As artificial intelligence (AI) becomes more deeply integrated in the industry, carriers must position themselves to respond to the changing business landscape. Those that adopt a mindset focused on creating opportunities from disruptive technologies—instead of viewing them as a threat to their current business—will thrive in the insurance industry in 2030.
How top tech trends will transform insurance
A handful of accelerating technology trends are poised to transform the very nature of insurance, creating significant opportunities for and, in some cases, existential threats to traditional players. To embrace the potential of these tech trends, winning insurers will build their tech talent, put tech trends and their business implications on the leadership agenda, and be willing to disrupt their own products and services.
Tech-driven insurers: How to thrive in 2030
Insurance companies are facing an absolute imperative to adapt their traditional operating models. Succeeding in 2030 will require insurers to define where they can excel, where they can form partnerships, and when they should leave the rest to others. After players have identified the strategic moves they’re best suited to make, they must adjust their operating models accordingly across four dimensions: technology, structures, processes, and people.
On climate
How insurance can help combat climate change (podcast)
In the transition to a green economy, the insurance industry can play a critical role in helping stakeholders manage risk. McKinsey’s Kurt Strovink, Kia Javanmardian, Dickon Pinner, and Antonio Grimaldi discuss the systemic risks of climate change and how they are changing the insurance industry—from innovations in underwriting to changing investment portfolios and the evolution beyond risk transfer toward risk mitigation.
Listen to the podcast here or here
Climate change and P&C insurance: The threat and opportunity
Many in the property-and-casualty (P&C) insurance industry have underestimated the immediacy of physical—and systemic—effects from climate change. With the long-term viability of the P&C insurance industry at stake, insurers should act now. This proactive response can not only better protect customers in the long term but also help safeguard the interests of society and serve the foundational purpose of the insurance industry.
On business building
Building new digital businesses in insurance (podcast)
Traditional insurers are seeing growing competition from digital players. The pandemic and changes in customer behavior are pushing the industry to become digital much more quickly, and one of the big levers is building their own businesses. McKinsey’s Ari Libarikian, Pia Schlüter, and James Bilefield discuss why and when a traditional insurer should build a new business—and how to get started.
Listen to the podcast here or here
CEO brief: The future of business building in insurance
Insurance executives must shift how they lead their institutions—from a methodical pace of change to the decisive reinvention of their businesses. New-business building is emerging as a crucial strategic priority to drive reinvention and innovation of the industry. Our experience across sectors shows that six elements define, and are essential to, organizations that repeatedly build successful new businesses.
The future of insurance: Unleashing growth through new-business building
Never has the need to digitize been more critical, given evolving customer behavior and the ever-increasing competitive threat to incumbents. They should assess their digital business across four main areas—customer acquisition, data and analytics, state-of-the-art technology, and talent—to see how they compare with digital natives and forward-thinking peers.