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      AI is transforming the insurance industry

      KPMG conducted an extensive research program, interviewing executive leaders across eight key global markets to understand the impact of AI on the insurance industry. The emergence of generative AI, along with the next wave of autonomous and agentic AI systems, is unlocking entirely new possibilities for innovation across the sector. Our research provides a detailed blueprint for insurance organizations to harness AI’s potential value.

      "While the blend of Machine learning, generative and agentic AI is a perfect fit for the insurance sector we are still in the early stages of adoption among local insurance companies. Despite many insurers recognizing AI as a source of competitive advantage, and increasing their AI budgets, the industry is held back by fundamental hurdles such as struggles with data availability and privacy, building trust in AI and the lack of a strategic AI vision across the organization. To move beyond this state, leadership must address the foundational needs identified in the first phase of our Enable-Embed-Evolve model."

      Jan Nyström 

      Head of Data, Analytics & AI

      At-a-glance insights:

      Insurers have high expectations
      0%

      believe that Insurance firms that embrace AI will develop a competitive edge over those who do not

      66%

      expect a moderate to very high ROI

      But the pressure is on to prove ROI
      0%

      face significant pressure from shareholders to show immediate ROI on AI investment

      AI spending will increase significantly
      0%

      will increase the percentage of global budget spent on AI

      of which

      66%
      say up to 20 percent.

      and

      34%
      say 20 percent plus.

      Building trust is a major concern—and priority

      46%

      of leaders have reservations about whether AI can be trusted while only

      25%

      fully trust AI within their organizations

      82%

      recognize the importance of establishing robust frameworks, policies and processes for regulatory compliance to ensure responsible AI implementation

      Leadership goals for AI adoption focus heavily on operational gains rather than strategic value

      How to realize value from your AI transformation journey

      To address these challenges, KPMG introduces the three phases of AI value — a framework designed to guide insurers through the AI adoption journey. This phased approach provides a structured roadmap, helping insurers prioritize investments, align initiatives with business goals, and position themselves effectively in the age of AI in insurance. Click on each of the phases below to find out more.

      Enable Embed Evolve Value Maturity Enterprise Functions Foundations

      Enable

      The Enable phase focuses on enabling people and building AI foundations. Organizations appoint a responsible executive, create an AI strategy, identify high-value use cases, boost AI literacy, align with regulations and establish ethical guardrails. AI pilots are launched across functions, while cloud platforms and pre-trained models are leveraged with minimal customization.

      Embed

      The Embed phase integrates AI into workflows, products, services, value streams, robotics, and wearables, delivering greater value. A senior leader drives enterprise-wide workforce redesign, re-skilling and change, embedding AI into operating models with a focus on ethics, trust and security. AI agents and diverse models are deployed, supported by cloud and legacy tech modernization, while enterprise-wide data enhances operations.

      Evolve

      The Evolve phase evolves business models and ecosystems, using AI and frontier technologies like quantum computing and blockchain to solve large sector-wide challenges. AI orchestrates seamless value across enterprises and partners. Emphasizing ethics and trust with real-time security, this phase uplifts human potential with broad and deep workforce training, fostering a creative, innovative and value-driven future.

      Download the report

      Intelligent insurance

      This research outlines a comprehensive blueprint for AI in insurance, helping insurers chart a path towards unlocking AI’s immense value.

      Our executive summary provides a cross-sector view of how organizations are navigating the opportunities and challenges of implementing AI. Download the executive summary to see the blueprint for intelligent industries to help you become an AI-powered, customer-centric organization ready to thrive in the intelligent economy.



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      Uncover how KPMG professionals' experience in asset management, banking and capital markets, insurance, private equity, and real estate can help build a more robust financial services system.
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      Putting the power of trusted data in motion.

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      Jenny Lehto

      Financial Services Advisory Lead

      KPMG in Finland

      Jan Nyström
      Jan Nyström

      Partner, Head of Data, AI & Emerging Technologies

      KPMG in Finland