The Impact of AI in Property and Casualty Insurance: A Study
A recent industry analysis reveals that only 10% of property and casualty insurers have effectively leveraged artificial intelligence, creating a significant divide between leading companies and the rest of the sector. The 19th edition of Capgemini's World Property & Casualty Insurance Report 2026 identifies these leading firms, termed "intelligence trailblazers," as achieving notably higher growth in revenue and share price over three years compared to their peers.
The research, gathering insights from 344 senior executives, 809 insurance employees, and 1,113 policyholders across the Americas, Europe, and Asia-Pacific, highlights a prevalent issue in measuring AI success. With 42% of insurers lacking metrics to assess AI performance, 60% remain in the early stages of AI experimentation without a reliable evaluation system.
These trailblazing firms differentiate themselves through strategic investments and robust accountability measures. They are characterized by substantial investment in change management, adopting explainable AI in operations, and integrating AI responsibilities into employee roles. The report points out that most of the sector misallocates AI resources, with 72% focused on technology and infrastructure, overshadowing the crucial aspect of change management.
Additionally, the report emphasizes human challenges in the insurance industry. Fifty-five percent of insurers do not perceive a clear return on AI investments, while a similar figure remains uncertain about initiative ownership. A skills shortage in AI is noted by two-thirds of insurers, with nearly half of employees experiencing no significant change despite access to AI tools.
Kartik Ramakrishnan, CEO of Capgemini's financial services strategic business unit, describes the industry's pivotal moment with AI integration. "Trailblazers demonstrate that incorporating AI into their core business strategy offers a significant competitive edge impacting financial performance," he explains. He advocates for enhancing data foundations, clarifying initiative ownership, and investing in skill development and governance to maximize enterprise value from AI.
In related findings, a survey from Insurity shows increasing consumer support for AI among policyholders, rising from 20% in 2025 to 39% in 2026. However, limitations persist as only 22% of consumers are comfortable with AI managing claim filings, and a mere 16% trust AI for autonomous policy cancellations or renewals.