Deloitte 2026 Insurance Outlook: Navigating Market Challenges & Tech Transformation

Deloitte's 2026 Global Insurance Outlook projects a challenging environment for the insurance industry marked by economic and geopolitical volatility, increased catastrophic events, and evolving customer expectations. The report forecasts a decline in global property and casualty premium growth through 2026, influenced by intensified competition, pricing pressures, and cost escalations. In the U.S., although underwriting results peaked in 2024, results are expected to deteriorate through 2026. Emerging markets, particularly China, face slower premium growth due to economic slowdowns. Tariffs are identified as a significant factor driving up claims costs in sectors such as auto and homeowners insurance, due to increased costs of repair parts and construction materials. These tariffs also contribute to higher credit risk and greater demand for trade credit insurance amid capacity challenges, while complicating risk exposure for marine and aviation insurers. The report highlights an increase in global weather-related losses, tighter reinsurance conditions, and an expanding protection gap. Legal risk factors, including third-party litigation funding and social inflation, are driving greater claim severity. Market dynamics show pressure from broker consolidation, corporate captive insurance, and alternative risk players, prompting carriers to explore agile capital models and capital-market instruments like catastrophe bonds and sidecars. Life insurance growth is expected to slow globally, especially in advanced markets, with annuities emerging as growth areas, notably in the U.S. and Europe. The sector is seeing increased convergence with private equity through private credit strategies and sidecar use. Group insurance growth will moderate, though there are opportunities in digital integration and ancillary benefits as employers seek carriers that align with benefits platforms. Technological advancement and AI adoption are central, with insurers focusing on fraud detection, underwriting, and customer engagement improvements. Success in these areas requires better data quality, legacy system modernization, cybersecurity, and enhanced data governance due to rising cyber risks associated with cloud, APIs, IoT, and AI deployments. Overall, Deloitte emphasizes the need for insurers to modernize operations, optimize capital management, and adapt business models to navigate the complex landscape ahead. The report also addresses tax changes and workforce implications influencing strategic planning for the insurance sector in 2026.