How the insurance industry’s growth and tech shifts are reshaping the workforce

In 2024, the global insurance industry is at a critical juncture as it grapples with high inflation, rising climate-related risks, and the transformative impact of AI. Recently, the industry recorded a 7,5% premium growth, reaching EUR 6,2 trillion — a peak not seen since 2006. This growth, however, brings new challenges. Insurers are raising premiums to counter inflation, particularly in regions with frequent natural disasters, like North America, where property and casualty lines have seen significant rate hikes. Life insurance is booming in Asia, with China and India fueling nearly half of the global premium increase. The U.S. remains dominant, holding over 44% of the global market share.

Amid this economic complexity, technological integration is reshaping industry operations. A 2024 survey revealed that 76% of U.S. insurance executives have implemented generative AI in core functions, achieving up to a 20% productivity boost. However, these advancements necessitate critical decisions regarding talent and cybersecurity. The insurance sector has shed 85,000 jobs in two years, amplifying a critical talent shortage compounded by an aging workforce and a lack of millennial interest. An aging workforce exacerbates this shortage, as nearly half a million insurance professionals approach retirement, a mere 4% of millennials express interest in insurance careers. To address these challenges, insurers are investing in reskilling and upskilling initiatives, focusing on digital competencies and fostering a culture of continuous learning. But do they achieve their goals? Dive into our full analysis to explore the strategies, innovations, and workforce shifts reshaping the industry. To understand these challenges better, let’s examine the structural and operational dynamics of the insurance sector.

The risk-averse nature of insurers’ cultures and their focus on underwriting margins and solvency have traditionally contributed to the industry’s slow pace of innovation and modernization.

For instance, high inflation and increasingly erratic climate-related losses have pressured the profitability of non-life insurance lines in recent years. Many insurers have responded by raising premium prices and scaling back coverage for some high-risk regions. Meanwhile, as interest rates rose, life insurance and annuity carriers competed fiercely to capitalize on the growing consumer interest in savings-linked products. These short-term strategies led to notable successes, including the best year-over-year underwriting results for property and casualty (P&C) carriers since 2007 in Q1 2024 and the highest Q1 sales of annuities for life and annuity (L&A) providers since the 1980s.

Elevating technological and operational capabilities, innovating product solutions, and expanding the insurance value proposition are critical steps to ensure that the insurance safety net remains reliable, accessible, and resilient. By modernizing infrastructure, streamlining operations, and rethinking business models, insurers can adopt a forward-looking approach to risk modeling, assessment, and mitigation.

The insurance industry stands at the forefront of global economic stability, offering crucial services that protect individuals and businesses against financial loss. HRForecast has identified a list of roles within the general sector and the insurance industry that employers will likely find difficult to fill. This difficulty stems from a combination of factors, including the need for niche expertise, the competitive nature of the job market, and the specific demands of these roles. The following analysis provides a deeper dive into these roles, offering insights into why they are in high demand and the implications for the industry.

This synchronization between our data and external sources underscores the reliability of our findings:

1. Investment analyst
2. Risk management specialist
3. Investment risk analyst
4. Investor relations manager
5. Legal specialist
6. Underwriter
7. Investment manager
8. Actuarial specialist
9. Trading analyst
10. Insurance claims specialist.

Particularly, positions such as investment risk analyst, actuarial specialist, and insurance claims specialist are projected to be particularly challenging to fill, with hiring durations extending beyond three to four months. It highlights the specialized nature of these roles and the critical need for skilled professionals in the insurance sector.

The analysis of these lists reveals critical insights into the evolving job market and the sectors that are anticipated to face talent shortages in 2024. It underscores the need for strategic actions from multiple stakeholders, including employers, educators, and policymakers, to address these gaps through targeted training, recruitment strategies, and policy adjustments. As the job market continues to evolve, staying ahead of these trends will be crucial for maintaining economic stability and growth.

The 2024 Global Insurance Market Report shared precisely what challenges, uncertain macroeconomic environments, and structural shifts impact the insurance sector, and the biggest one is digitalization.

The impact of digitalization and AI

The financial turbulence of 2023 highlighted how rapidly technology can shift market dynamics. AI is transforming the insurance sector’s operations, especially in distribution channels, by enabling precise risk modeling, customer behavior analysis, and adaptive marketing strategies. However, this shift introduces challenges, such as heightened cybersecurity risks and reputational vulnerabilities. Insurers must balance AI’s potential for efficiency with robust safeguards to maintain trust and operational stability.

The Deloitte 2025 global insurance outlook revealed that by 2032, insurers could generate approximately US$4.7 billion in annual global premiums from AI-related insurance, yielding a robust compounded annual growth rate of around 80%.

What does it mean for the labor market?

• Increased demand for AI and digital literacy
• A focus on upskilling employees through analytics and tailored learning
• Greater emphasis on creativity, empathy, and analytical thinking
• Reliance on outsourcing to address immediate talent shortages.

Among other challenges, PWC added:

• Macroeconomic and structural obstacles. The insurance industry faces growing challenges related to climate change, which has led to increased claims due to natural disasters, directly affecting underwriting and claims processes. This change requires employees to be knowledgeable in environmental science, risk management, and environmental practices to develop sound strategies. In addition, economic instability, inflation, and regional demand trends require insurance companies to adapt quickly, encouraging a workforce that is technically savvy and able to respond to these macroeconomic changes.
• Increased requirements for climate risks and social goals. Due to climate change, insurers face increasing natural disaster claims, affecting underwriting and claims roles. Employees with expertise in environmental science, risk management, and sustainable practices will be in demand as companies develop strategies to cope with these challenges. There’s a need for an adaptable, tech-savvy workforce well-versed in inflation, sustainability, and region-specific demand trends.
• New forms of competition. The competitive landscape is intensifying with the emergence of InsurTech startups and non-traditional players, such as technology firms and retail giants, leveraging innovative solutions and established customer bases. These new competitors are challenging traditional insurers to modernize and offer more personalized, seamless digital experiences to meet changing customer expectations. This transformation is essential to remain relevant in the market and meet the dynamic needs of today’s consumers.

We’d also add one more challenge, which is

Low trust in financial institutions

According to the Edelman Trust Barometer, only 54% of respondents trusted the financial services industry in 2022, 10 percentage points lower than the average for other industries in the report. And the figure also increased slightly in 2024 to 62%, marking an eight-percentage point increase over two years. Yes, it increased, but this level still places the industry in a relatively neutral or borderline positive range globally.

While trust in financial services has shown signs of improvement, historically low trust levels, limited access to financial products, and inadequate financial education have contributed to persistent underinsurance. This has driven a growing global protection gap, which reached $1.4 trillion in 2020 and is projected to rise to $1.86 trillion by 2025, with nearly half of the uninsured risks concentrated in the Asia-Pacific region. While these challenges are daunting, innovative solutions are emerging to address them head-on.

Insurance organizations, like companies from other industries, should have innovative solutions based on data, workforce planning, and technology. Below, we’ve shared practical tips to address these challenges:

• Evaluate workflows and identify tasks ripe for automation

AI-driven automation is a good solution to streamline repetitive processes like claims processing, policy underwriting, and fraud detection. It helps you evaluate workflows and identify tasks ripe for automation, significantly reducing processing times and operational costs. Automating these functions allows employees to shift their focus to more complex and customer-centric roles, improving overall service quality.

• Identify roles most impacted by AI, creating tailored reskilling strategies

Map out current and future skills needs, aligning your workforce with digital demands. This approach uses insights from over 10 billion data points to identify roles most impacted by AI, creating tailored reskilling strategies. For instance, claims processing can transition from manual tasks to automation-supported decision-making, supported by skill-specific training programs.

• Manage predictive models to anticipate customer needs, optimize pricing strategies

AI-powered insights enable insurers to make smarter and faster decisions. With AI-based automation and data analysis tools, you can manage predictive models to anticipate customer needs, optimize pricing strategies, and identify emerging market opportunities. Use these insights to develop personalized policies and improve risk management, fostering customer satisfaction and business growth.

• Skills-based workforce strategy

Macroeconomic challenges, including fluctuations in labor costs and skill shortages, focus on skills-based workforce planning. However, we have a solution for you. Using TalentNeuron’s skills evolution models, you can differentiate between emerging, core, and declining skills, enabling them to prioritize workforce development. Internal training program integration is suitable for core and declining skills, with external hiring for emerging ones; companies can build a resilient talent pool ready to adapt to market shifts.

• Strategic location analysis for cost optimization

Addressing structural challenges such as geographic talent disparities requires data-driven location strategies. Identify cost-effective talent hubs with favorable supply-demand dynamics. Offering remote or hybrid work models further expands access to skilled professionals while reducing operational costs tied to high-demand areas.

• Enhancing employee value proposition (EVP) to attract talent

To remain competitive in a tight labor market, redefine your EVP. Benefits like flexible work arrangements, sabbaticals, and childcare support appeal to critical talent pools. A strong, tailored EVP attracts top candidates and boosts retention and employee engagement, creating a more stable workforce amid macroeconomic uncertainty.

• Integrating green HR strategies to foster sustainability

“Sustainability, sustainability everywhere,” and insurance companies should prioritize it, especially in Europe. Start small by embedding sustainability into HR practices, making them greener.

This includes training on environmental awareness, promoting eco-friendly workplace policies, and aligning employee objectives with corporate social responsibility (CSR) goals.

Green HR strategies weave sustainability throughout the organization, nurturing inclusive workplace cultures and driving practices like circular economy initiatives and green finance principles for long-term profitability and planetary protection.

The result? A workforce better equipped to tackle climate challenges and aligned with the company’s CSR goals.

• Using data and AI for climate risk and social goal alignment

AI-driven tools and data analysis can help you predict climate risks, align with social goals, and identify skill gaps for sustainability roles. Solutions that include location analysis and data-based workforce planning contain actionable insights into areas with favorable environmental policies and skilled talent pools. These tools are critical for insurers planning eco-friendly relocations or expanding greenfield operations.

• Crafting competitive EVPs with a sustainability focus

Focus on developing a strong employee value proposition (EVP) using data-driven insights to attract and retain talent passionate about sustainability. This strategy ensures the company appeals to a socially conscious workforce.

• Strategic competitor benchmarking to stay ahead of industry trends

To address the challenge of rising competition, use competitor benchmarking to understand market trends, emerging competitors, and talent strategies. Drawing insights from the Siemens case, which used labor market intelligence data to analyze competitors and forecast future trends, insurers can identify opportunities to innovate, refine their offerings, and outpace new entrants.

• Rebuilding trust through data-driven market insights

Craft your customer-centric solutions informed by labor market data and customer preferences. Solutions like labor market research can align your workforce capabilities and customer engagement strategies with current market needs. Transparency, ethical practices, and tailored solutions rebuild trust and enhance brand loyalty.

• Innovation through workforce and market intelligence

The insurance industry’s future relies on innovation powered by comprehensive market intelligence. Use solutions to analyze job insights and competitor practices to predict emerging skills and trends. It’s a good way to foster a workforce ready to innovate while aligning with evolving market demands.