North American property and casualty (P&C) insurers that invest more resources in advanced analytics and artificial intelligence generate higher profitability and stronger premium growth, according to a new WTW survey.
WTW’s 2026 Advanced Analytics and Artificial Intelligence Survey asked 59 property and casualty insurance companies in the U.S. and Canada, drawing insights from senior executives in analytics, actuarial and strategy functions.
The survey found that between 2022 and 2024, insurers using more sophisticated analytics saw their combined ratios fall by 6 percentage points and premium growth increase by 3 percentage points compared with slower adopters.
“Advanced analytics and artificial intelligence are starting to yield significant returns as leading insurance companies report measurable returns on investment,” said Laura Doddington, head of personal and commercial lines, insurance consulting and technology for WTW North America. “As insurance companies plan to increase investment in personal and commercial lines, advanced analytics is rapidly moving from a competitive advantage to an essential requirement to maintain market vitality and drive sustainable growth.”
Nearly 80% of insurance companies currently rely on advanced rating and pricing models, and a further 11% plan to implement these models soon, making predictive rating models nearly universal.
Adoption of advanced analytics for claims has been slower, with only one-third or fewer carriers currently using these tools for fraud detection (33%) or severity assessment (29%). However, these figures are expected to rise to 65-70% within the next two years. Another 36% plan to introduce straight-through processing into claims workflow automation, up from 14% currently.
Although large language models (LLMs) and generative AI are relatively new to the insurance industry, more than half of respondents said they are already using them, with a further 29% planning to adopt them within the next two years. While only 16% of insurers currently use AI to augment manual underwriting, this number is expected to rise significantly, with 60% planning to prioritize this by 2028.
Survey respondents identified data issues and IT bottlenecks as key challenges to adopting advanced analytics. 42% of respondents cited data-related issues, such as poor quality and limited accessibility, and insufficient IT support as significant barriers.
Building an analytics-driven culture also remains a work in progress. Only 20% of respondents reported having a clear analytics strategy to guide daily activities, and only 12% provided regular analytics training to employees.
Doddington added: “The ability to leverage advanced analytics and AI will increasingly define market relevance, operational efficiency and strategic agility. At the same time, using AI tools without a solid foundation may exacerbate existing problems rather than solve them.
“Data quality and robust governance, coupled with the ability to deploy analytics without hitting IT bottlenecks, are critical to the successful adoption of artificial intelligence and machine learning. Insurers that master these fundamentals will be able to best leverage these advanced tools and technologies to gain a competitive advantage in an increasingly data-driven market.”
The post Insurers using advanced analytics and AI see stronger results: WTW survey appeared first on ReinsuranceNe.ws.