The AI in insurance market growth is driven by rising adoption of automated claims processing, predictive risk assessment, and cloud-based insurance platforms. The market is projected to register a CAGR of 34.20% during 2026-2031, supported by growing demand for AI-powered underwriting, fraud detection, and personalized insurance solutions across the global insurance industry.
Hyderabad, India, May 07, 2026 (GLOBE NEWSWIRE) — According to recent research published by Mordor Intelligence, the AI in insurance market is witnessing a rapid transformation as insurers increasingly adopt automation, predictive analytics, and machine learning technologies to streamline operations and improve customer experiences. The AI in insurance market size is projected to grow from USD 26.3 billion in 2026 and is forecast to reach USD 114.52 billion by 2031, registering a CAGR of 34.20% during 2026-2031.
According to industry analysis, growing demand for personalized insurance products, automated claims processing, fraud detection systems, and AI-powered underwriting solutions continues to accelerate AI in insurance market globally. As per published reports, insurers are increasingly leveraging artificial intelligence to reduce operational costs, enhance decision-making capabilities, and improve customer engagement across life, health, property, and casualty insurance segments. The expanding adoption of cloud computing, big data analytics, and generative AI technologies is further strengthening the artificial intelligence in insurance market outlook over the forecast period.
AI in Insurance Industry Expands Through Intelligent Automation
Accelerating Insurance Innovation Through Cloud Modernization
Traditional mainframes struggle to handle the demands of instant rating and automated claims. By shifting policy, billing, and claims functions to the cloud, insurers can cut costs and speed up deployment. Microservices and open APIs make it simple to integrate advanced tools, like AI or computer vision, without large overhauls. Insurers who modernize their core systems also benefit from flexible scaling, ensuring they can handle sudden surges like disasters. Cloud providers safeguard sensitive data, simplifying compliance and freeing up resources for innovation in the insurance space.
“The evolving role of AI across insurance workflows is reshaping how carriers approach efficiency, risk assessment, and customer engagement. Mordor Intelligence combines structured primary research, multi-source validation, and consistent market tracking to provide decision-makers with a balanced view grounded in observable industry developments” says Ashish Gautam, Senior Research Manager, Mordor Intelligence.
AI-Driven Personalization in Insurance Underwriting
AI models analyze a range of data like medical records, property valuations, and financial details, quickly transforming them into precise risk insights. What used to take weeks now happens in moments, allowing insurers to handle complex policies faster. For example, Star Union Dai-ichi Life uses advanced AI platforms to create personalized policy terms based on each customer’s lifestyle and health. These systems continuously learn, so coverage can adjust as circumstances change, like adding smart devices or better driving habits. As a result, underwriting becomes more tailored, improving customer experience and overall financial performance.
Table of Contents (Partial) – AI in Insurance Industry
1. INTRODUCTION
1.1 Market Definition and Study Assumptions
1.2 Scope of the Study
2. RESEARCH METHODOLOGY
3. EXECUTIVE SUMMARY
4. MARKET LANDSCAPE
4.1 Market Overview
4.2 Market Drivers
4.2.1 Cloud-first Core-system Modernisation
4.2.2 Rapid Growth of Embedded/Usage-based Insurance
4.2.3 Regulatory Push for Straight-through Digital Claims
4.2.4 Gen-AI Powered Ultra-personalised Underwriting
4.2.5 Others
4.3 Market Restraints
4.3.1 Data-privacy and Model-explainability Compliance Burden
4.3.2 Legacy-system Integration Costs
4.3.3 Restrictive Model-risk-management Frameworks
4.3.4 Talent Shortage and AI Skills Gap
4.4 Value / Supply-Chain Analysis
4.5 Evaluation of Critical Regulatory Framework
4.6 Impact Assessment of Key Stakeholders
4.7 Technological Outlook
4.8 Porter’s Five Forces Analysis
4.8.1 Bargaining Power of Suppliers
4.8.2 Bargaining Power of Consumers
4.8.3 Threat of New Entrants
4.8.4 Threat of Substitutes
4.8.5 Intensity of Competitive Rivalry
4.9 Impact of Macro-economic Factors
5. MARKET SIZE AND GROWTH FORECASTS (VALUE)
5.1 By Offering
5.1.1 Hardware
5.1.2 Software
5.1.3 Services
5.2 By Deployment Mode
5.2.1 Cloud
5.2.2 On-Premises
5.3 By Enterprise Size
5.3.1 SMEs
5.3.2 Large Enterprises
5.4 By End-User
5.4.1 Life and Health Insurance
5.4.2 Property and Casualty Insurance
5.5 By Technology
5.5.1 Machine Learning
5.5.2 Natural Language Processing
5.5.3 Computer Vision
5.6 By Geography
5.6.1 North America
5.6.1.1 United States
5.6.1.2 Canada
5.6.1.3 Mexico
5.6.2 South America
5.6.2.1 Brazil
5.6.2.2 Argentina
5.6.2.3 Rest of South America
5.6.3 Europe
5.6.3.1 Germany
5.6.3.2 United Kingdom
5.6.3.3 France
5.6.3.4 Italy
5.6.3.5 Spain
5.6.3.6 Russia
5.6.3.7 Rest of Europe
5.6.4 Asia-Pacific
5.6.4.1 China
5.6.4.2 Japan
5.6.4.3 India
5.6.4.4 South Korea
5.6.4.5 Australia and New Zealand
5.6.4.6 Rest of Asia-Pacific
5.6.5 Middle East and Africa
5.6.5.1 Middle East
5.6.5.1.1 Saudi Arabia
5.6.5.1.2 United Arab Emirates
5.6.5.1.3 Turkey
5.6.5.1.4 Rest of the Middle East
5.6.5.2 Africa
5.6.5.2.1 South Africa
5.6.5.2.2 Nigeria
5.6.5.2.3 Egypt
5.6.5.2.4 Rest of Africa
6. COMPETITIVE LANDSCAPE
6.1 Market Concentration
6.2 Strategic Moves
6.3 Market Share Analysis
6.4 Company Profiles
6.4.1 IBM Corporation
6.4.2 Microsoft Corporation
6.4.3 SAP SE
6.4.4 OpenText Corporation
6.4.5 Oracle Corporation
6.4.6 Guidewire Software, Inc.
6.4.7 SAS Institute Inc.
6.4.8 Salesforce, Inc.
6.4.9 Pegasystems Inc.
6.4.10 and more
7. MARKET OPPORTUNITIES AND FUTURE TRENDS
7.1 White-space and Unmet-need Assessment
Explore more insights into the AI in insurance market: https://www.mordorintelligence.com/industry-reports/ai-in-insurance-market?utm_source=globenewswire
Regional Outlook for Artificial Intelligence in Insurance Market
North America Strengthening AI Insurance Capabilities
North America continues to see strong adoption of AI-driven insurance solutions as insurers invest in advanced analytics, cyber risk assessment, and automated underwriting technologies. Supportive regulatory frameworks and active insurtech innovation are helping carriers expand digital capabilities while improving transparency and customer protection.
Asia-Pacific Accelerating Digital Insurance Transformation
Asia-Pacific is emerging as a fast-growing region for AI adoption in insurance, driven by mobile-first consumers and rapid digitalization. Insurers across the region are increasingly using AI across underwriting, claims processing, and customer engagement, while cloud-native systems are helping companies modernize operations more efficiently.
Check out related reports published by Mordor Intelligence:
AI in Oil and Gas Market Size
The AI in oil and gas market is projected to grow from USD 4.28 billion in 2026 to USD 7.91 billion by 2031, registering a CAGR of 13.03% during the forecast period. Growth is being driven by increasing adoption of predictive maintenance, reservoir optimization, real-time asset monitoring, and AI-powered drilling analytics. Companies are increasingly leveraging AI to improve operational efficiency, reduce downtime, and strengthen safety across upstream and downstream operations.
Cloud AI Market Share
The cloud AI market is projected to grow from USD 114.26 billion in 2026 to USD 269.02 billion by 2031, expanding at a CAGR of 18.68% during the forecast period. Rising enterprise demand for scalable AI infrastructure, cloud-native machine learning platforms, and generative AI workloads continues to fuel market expansion. Increasing investments in hybrid cloud environments and AI-as-a-service solutions are also accelerating adoption across industries.
Amazon Web Services Inc., Microsoft Corporation, Google LLC, IBM Corporation, and Intel Corporation are the major companies operating in this market.
Read more about companies active in the cloud AI market:
https://www.mordorintelligence.com/industry-reports/cloud-ai-market/companies?utm_source=globenewswire
Artificial Intelligence Market Outlook
The artificial intelligence market is forecast to grow from USD 434.42 billion in 2026 to USD 2,503.13 billion by 2031, advancing at a CAGR of 41.95% during the forecast period. The market is witnessing rapid expansion due to the growing adoption of generative AI, intelligent automation, predictive analytics, and AI-powered enterprise applications. Increasing investments from technology companies and expanding AI integration across healthcare, finance, retail, and manufacturing sectors continue to drive strong momentum.
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