Global Artificial Intelligence (AI) in Insurance Market Outlook 2025-2035
Artificial Intelligence (AI) is transforming the insurance sector by enhancing operational efficiency, reducing fraud, improving customer engagement, and enabling intelligent automation across processes such as underwriting and claims management. AI technologies including machine learning, natural language processing, computer vision, robotic process automation, and predictive analytics are widely adopted to streamline policy management, risk assessment, and compliance. Insurers harness AI to accelerate claims settlements, personalize product offerings, and manage risk more proactively in a competitive, evolving global landscape. The increasing digitalization of insurance, coupled with growing investments in AI-driven innovation, is expected to propel the market’s significant growth worldwide through 2035.
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Latest Market Dynamics
Key Drivers
- Rising demand for enhanced customer experience and personalized insurance solutions, as illustrated by Lemonade leveraging AI chatbots to expedite claim processing and policy management.
- Increased adoption of predictive analytics and automation for fraud detection, demonstrated by Shift Technology’s AI-powered fraud detection platform being integrated by major global insurers.
Key Trends
- Expansion of cloud-based AI insurance solutions, evidenced by Zurich Insurance's partnership with Microsoft Azure to enable scalable AI deployments.
- Integration of AI-powered underwriting tools, such as those from Planck, which provide insurers with real-time data insights to optimize risk assessment and pricing.
Key Opportunities
- Growth in AI-driven insurance distribution via online and direct channels, with companies like Ping An leveraging digital platforms for customer onboarding and claims.
- Emergence of niche AI applications such as IoT-integrated insurance policies, as used by AXA for connected homes and vehicles to create tailored, usage-based products.
Key Challenges
- Data privacy and regulatory compliance risks, especially as companies like BIMA expand to emerging markets with evolving data protection laws.
- Talent shortage and skill gaps in AI/ML implementation, even for industry leaders like Tractable, which invest heavily in talent acquisition and workforce upskilling.
Key Restraints
- High upfront investment in AI infrastructure and solutions, posing adoption barriers for small-medium insurers, despite efforts by marketplaces like Trov to democratize access.
- Complexity in integrating legacy insurance IT systems with modern AI capabilities, as many traditional players, such as Zurich, still navigate digital transformation hurdles.
Global AI in Insurance Market Share by Type, 2025
In 2025, machine learning is the dominant technology type in the insurance AI market, comprising 34% of total market share. Natural language processing and predictive analytics also command significant proportions, enabling automation, speech recognition, and advanced data analysis. Computer vision and robotic process automation are growing rapidly owing to their applications in claims automation and document processing. This diversified adoption reflects the industry’s focus on operational efficiency, real-time insights, and customer-centricity. Insurers are increasingly integrating a mix of these technologies to unlock value in personalized underwriting, dynamic pricing, fraud prevention, and optimized claims journeys.
Global AI in Insurance Market Share by Application, 2025
Claims processing leads AI adoption in the insurance applications segment in 2025 with a 29% market share, followed closely by fraud detection and risk management. AI’s role in accelerating the claims lifecycle—through real-time data analysis, automation, and decision making—has resulted in enhanced speed, accuracy, and customer satisfaction. Additionally, underwriting and customer service continue to leverage AI for predictive modeling and personalized interactions, supporting insurers in building more robust, consumer-centric, and resilient operations across the value chain.
Global AI in Insurance Market Revenue (USD Million), 2020-2035
The global AI in insurance market is projected to grow from $5,750 million in 2021 to $37,800 million by 2035, representing a robust CAGR driven by continuous digital transformation, increasing automation, and AI’s expanding applications in underwriting, claims, fraud prevention, and personalized insurance. Major insurers and technology vendors fuel this growth with strategic investments and partnerships to create new value propositions, streamline back-office operations, and enhance customer experience.
Global AI in Insurance Market YoY Growth (%), 2020-2035
The year-on-year growth rate of the global AI in insurance market is expected to average 14.6% from 2025 through 2035, reflecting a sustained acceleration amid technological advancements and increased deployment across regions. The growth curve highlights initial spikes due to early adoption, with a gradual moderation as the market matures and AI integration in insurance products and services becomes mainstream.
Global AI in Insurance Market Share by Region, 2025
North America leads the AI in insurance market share globally with 37% in 2025, owing to advanced digital infrastructure, high investment rates, and a strong presence of AI technology vendors. Europe follows closely, with rapid adoption in countries like the UK, Germany, and France. The Asia-Pacific region demonstrates strong growth potential, reflecting increasing digital insurance penetration and innovation across China, India, and Japan. Other regions including Latin America and MEA are gradually adopting AI-driven insurance solutions as part of digital transformation agendas.
Global AI in Insurance Market Players Share, 2025
IBM and Microsoft remain the foremost players in the AI insurance market, controlling a combined 41% of the global share due to their comprehensive AI portfolios, cloud-hosted offerings, and strategic insurer partnerships. Insurtech firms such as Lemonade, Shift Technology, and Tractable are increasingly influential, leveraging innovative AI models to serve niche applications and disrupt traditional business models. Collaborations and product co-development among these players are intensifying market competition and accelerating global AI adoption in insurance.
Global AI in Insurance Market Buyers Share, 2025
Large insurance organizations constitute the largest buyer segment at 44% in 2025, largely due to their resources for investing in advanced AI infrastructure and capabilities. Medium-sized insurers represent 33% of buyers, while small insurers increasingly pursue AI adoption through SaaS offerings and partnerships. The competitive landscape is driving firms across the size spectrum to implement AI to optimize cost, enhance efficiency, and improve customer satisfaction.
Study Coverage
| Metrics | Details |
|---|
| Years | 2020-2035 |
| Base Year | 2025 |
| Market Size | 9800 |
| Regions | North America, Europe, Asia-Pacific, South America, Middle East, Africa |
| Segments | Machine Learning, Natural Language Processing, Computer Vision, Robotic Process Automation, Predictive Analytics, Others, Claims Processing, Underwriting, Risk Management, Fraud Detection, Customer Service, Compliance & Reporting, Direct, Brokers/Agents, Bancassurance, Online, Third-Party Administrators, Cloud, On-Premise, Hybrid, Blockchain, IoT, Small, Medium, Large |
| Players | IBM, Microsoft, Google, Amazon, Lemonade, Shift Technology, BIMA, Cape Analytics, Tractable, Trov, ZestFinance, Planck, Zurich Insurance Group, Ping An Insurance, AXA |
Key Recent Developments
- In June 2024, Lemonade announced the deployment of a new AI-powered claims resolution platform, reducing average settlement time to under three minutes.
- On July 12, 2024, Shift Technology partnered with a leading European insurer to extend its AI-driven fraud detection solution across Latin America.
- In August 2024, Zurich Insurance integrated Microsoft Azure AI to enhance its digital underwriting and customer onboarding processes.
- On September 2, 2024, Ping An launched a new suite of IoT-enabled health insurance products powered by AI for targeted risk pricing.
- In October 2024, Tractable raised an additional $75 million to expand its AI-based auto claims assessment platform globally.
