# Nine predictions for the insurance industry in 2022 Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-02-04 Category: INSURANCE Category URL: https://financedigest.com/category/insurance Meta Title: Insurance Industry Predictions 2022: Customer Experience, Meta Description: Discover the top trends for the insurance industry in 2022, including enhanced customer experience, sustainability focus, ecosystem integration, and URL: https://financedigest.com/nine-predictions-for-the-insurance-industry-in-2022html ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/istock-1334574095-1736816261056-compressed.jpg) _By_ **_Dorji Wangchuk,_** _Insurance Growth Strategy expert at_ [_PA Consulting_](https://www.paconsulting.com/industries/financial-services/) _._ If 2021 has been a year of recovery and adjustment for the insurance industry from the impact of the pandemic, 2022 will be the year for major step change and transformation. Leading insurers will deliver major product innovations responding to sustainability and climate change, and demand for financial well-being, health and protection solutions will rise. There will be a renewed focus on customer experience and personalisation, integration with the broader ecosystem, investments into digital, data analytics and talent will intensify. We will see more [insurers adopt an agile way](https://www.financedigest.com/predictive-analytics-a-new-way-of-insuring-success.html "Predictive analytics: a new way of insuring success") of delivering transformation and operating at pace in a fast-changing post-pandemic world. Here are nine predictions for 2022 for the [insurance industry:](https://www.financedigest.com/improving-risk-management-in-the-insurance-industry.html "Improving risk management in the insurance industry") **1.Customer experience and personalisation will accelerate** Customers will demand better [customer experience and personalisation from their insurance](https://www.financedigest.com/customer-engagement-in-the-insurance-sector.html "Customer engagement in the insurance sector") providers. Experience inflation from other sectors, transition to [digital and hybrid working and adopting services](https://www.financedigest.com/matching-digital-adoption-with-cybersecurity-in-the-financial-services-industry.html "Matching digital adoption with cybersecurity in the financial services industry") remotely during the pandemic have permanently enhanced customer expectations. Significantly improved omni-channel experience will become a necessity. Use of dashboards for insights and to get a complete view of their financial products, including savings, pensions and protection products, will also grow, partly driven by the ongoing development and testing of the UK Pensions Dashboard programme. Market leaders will invest in capabilities to deliver better customer experiences and personalisation to differentiate themselves. **2.** **Insurers will demonstrate irrefutable progress in sustainability and climate change** 2021 has been the year where climate change, culminating in COP26 in Glasgow, has truly become mainstream. COP26 saw the largest private sector participation with more businesses than ever setting their own [sustainability targets](https://www.financedigest.com/big-brands-set-to-miss-plastic-sustainability-targets.html "Big brands set to miss plastic sustainability targets"). PA’s [recent research](https://www2.paconsulting.com/FS-Conscious-Consumer-report-download.html) found 86 per cent of customers care about sustainability and consumers expect their financial services provider to embrace sustainability as ‘business as usual’, innovate and help them in their sustainability goals. 2022 will see sustainability and climate change dominate the board agenda of insurance companies as they incorporate ESG policies and practices by demonstrating transparency, reporting progress, and developing products and [solutions to help manage ESG risks](https://www.financedigest.com/jaywing-releases-horizon-a-new-ifrs-9-modelling-solution-that-encapsulates-its-extensive-credit-risk-expertise.html "Jaywing releases Horizon, a new IFRS 9 modelling solution that encapsulates its extensive credit risk expertise") and enable new, low carbon technologies. **3.** **Integration into a broader ecosystem will accelerate** As insurers innovate their products and propositions, the ability to offer value added services, offerings from adjacent and other sectors and providing total end-to-end solutions for engagement, prevention, risk management and after service management, will be critical. [Insurers realise that the fastest way](https://www.financedigest.com/5-ways-a-ccm-platform-can-help-improve-customer-engagement-in-insurance.html "5 Ways a CCM platform can help improve customer engagement in insurance") to scale and develop capabilities, in addition to M&A, is to integrate with the wider market. In 2022, we will see [continued investments](https://www.financedigest.com/ils-investment-returns-continue-to-outperform-according-to-aon-insurance-linked-securities-report.html "ILS investment returns continue to outperform, according to Aon insurance-linked securities report") into partnerships and integration with various ecosystems such as health, agriculture, mobility, and in some cases, M&As, to support overall financial well-being of individuals, provide solutions for large commercial risks or drive better experience for clients and customers. The [insurance industry](https://www.financedigest.com/how-can-the-insurance-industry-avoid-having-a-kodak-moment.html "How can the insurance industry avoid having a ‘Kodak Moment?’"), particularly the Life and Pensions industry, will also make forays into open finance. **4.The insurance industry will see major product innovations** New risks due to climate change, technology advances, supply chain disruption, availability of [data and changing customer](https://www.financedigest.com/should-insurers-buy-data-direct-from-their-customers.html "Should insurers buy data direct from their customers?") demands will drive product innovations in the market. Embedded Insurance will grow as product and service providers across various [sectors](https://www.financedigest.com/whats-driving-consumer-opinion-in-the-insurance-sector.html "What’s driving consumer opinion in the Insurance Sector?") incorporate insurance into their offerings.  Parametric and index-based insurance for climate and weather-based risks and [commercial operations](https://www.financedigest.com/iveco-to-transfer-nordic-retail-and-commercial-operations-to-hedin.html "Iveco to transfer Nordic retail and commercial operations to Hedin") will expand significantly. We will also see more ecosystem-based offerings across different [insurance sectors](https://www.financedigest.com/2020-the-paradoxical-year-that-has-reshaped-the-future-of-motor-insurance-and-related-sectors.html "2020: The paradoxical year that has reshaped the future of motor insurance and related sectors"). The cyber-insurance market will expand as more organisations [secure their data](https://www.financedigest.com/2023-fintech-prediction-secure-and-private-data-usage-is-key.html "2023 FinTech Prediction: Secure and Private Data Usage is Key"), systems, and networks to counter the threat of hacking and ransomware. Growth of non-fungible tokens (NFTs) and the emerging metaverse [ecosystem will also provide innovation](https://www.financedigest.com/avaloq-enlarges-innovation-ecosystem-through-launch-of-developer-portal.html "Avaloq enlarges innovation ecosystem through launch of developer portal") opportunities to insurers. **5.Digitalisation and data analytics will remain a priority** Innovation will be a top agenda point. Demand for personalisation, better customer experience and innovation will drive investments into cloud, digital solutions, automation and [artificial intelligence](https://www.financedigest.com/how-artificial-intelligence-is-simplifying-sanctions-screening-for-insurers.html "How Artificial Intelligence is Simplifying Sanctions Screening for Insurers") and machine learning. For instance, the industry will see significant advances in the use of AI and machine learning powered underwriting, [fraud detection](https://www.financedigest.com/the-clues-to-detecting-fraud-are-hidden-in-relationships.html "THE CLUES TO DETECTING FRAUD ARE HIDDEN IN RELATIONSHIPS") in claims management and operations, growth of automation in digital portals and dashboards, and use of analytics in new product development and customer management. **6.Financial wellbeing will be a key focus area** The pandemic has put significant strain on the finances of individuals and households, and consumers are more aware of the importance of financial wellbeing, including long term savings, protection, and access to immediate financial resources. In 2022, Life and Pension companies will develop new products, services, and partnerships addressing the financial well-being of their customers throughout the financial lifecycle of an individual or household. Life and Pensions [companies will also work more closely with employers to align and incorporate their offerings with their employee](https://www.financedigest.com/why-more-companies-are-asking-new-employees-to-commence-employment-before-christmas.html "Why more companies are asking new employees to commence employment BEFORE Christmas.") wellbeing strategy. The advice market, which according to Legal & General1 estimates that less than 20% of those approaching retirement take financial advice, will see innovation in tools and mechanisms of customer engagement and product delivery. **7.Health and protection markets will further grow** The pandemic has also amplified the importance of [health insurance](https://www.financedigest.com/are-there-tax-breaks-for-business-health-insurance.html "Are there tax breaks for business health insurance?") and protection in the lives of customers. The large protection gap, ageing population, strain on social care and increasing out-of-pocket health expenses in the UK will increase demand for health and protection products. Leading [insurers will further invest](https://www.financedigest.com/classic-car-insurance-broker-launches-future-classic-investment-guide.html "Classic car insurance broker launches Future Classic investment guide") into developing relevant products, providing digital tools such as virtual GPs, and integrating capabilities from the wider health and well-being ecosystem to capture this emerging demand. **8.The insurance** [industry will increase adoption of agile transformation](https://www.financedigest.com/how-solvency-ii-transformed-itself-the-fund-industry-and-regulation.html "How Solvency II transformed itself, the fund industry and regulation") To respond to the changing market conditions due to COVID-19, customer needs and digital advancements, to manage costs and to adapt to hybrid ways of working, the [insurance sector will need](https://www.financedigest.com/breaking-down-the-types-of-insurance-you-need.html "Breaking Down the Types of Insurance You Need") to transform. According to PA’s [research](https://www.paconsulting.com/insights/agile-organisations/the-secrets-of-organisational-agility/), 72 per cent of business leaders across different sectors, including financial services, say improving organisational agility is a strategic priority. Agile delivery is being increasingly used by the insurance [industry for its proven benefits](https://www.financedigest.com/five-industries-benefiting-from-multi-carrier-sim-technology.html "Five Industries Benefiting from Multi-Carrier SIM Technology") of increasing quality and productivity, driving customer centricity and time to market. We will see growth in penetration of agile transformation and methodologies into the insurance industry in 2022 as they seek to become more agile organisations. **9.Competition for talent will intensify** Insurers are looking to assess, restart and accelerate strategic delivery and are seeking highly skilled and experienced individuals.  Established organisations recognise that they are competing with [FinTechs and other financial](https://www.financedigest.com/how-can-fintechs-better-engage-zillennials-with-their-financial-health-the-answer-lies-in-speaking-to-them-in-their-own-language.html "How can fintechs better engage Zillennials with their financial health? The answer lies in speaking to them in their own language") services players for talent. In 2022, we expect the insurance industry to have a renewed focus on attracting and retaining [top talent](https://www.financedigest.com/5-steps-hiring-top-talent-youre-just-start.html "5 steps to hiring top talent when you’re just a start-up "). For instance, [insurers will further adopt and communicate](https://www.financedigest.com/dodge-a-bullet-with-the-insurance-act-2015-act-now-to-implement-two-way-communication.html "Dodge a bullet with the Insurance Act 2015: Act now to implement two-way communication") values such as sustainability and diversity and inclusion within their organisation, revamp incentives to align to the expectations of the more digitally focused talent, further enable hybrid ways of working and reskill existing employees. The insurance industry, having responded well to the pandemic, is currently at the cusp of significant growth and transformation opportunities. Winners in the market will be those willing to be bold and forward thinking and adapt their strategies and business models to the ever-changing market landscape. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---