Technology is the biggest driver of current and future trends offering risk and opportunity for the insurance industry, according to a newly released report.

Prescriptive analytics, shared mobility and the Metaverse are the top three areas where evolving risk will open markets for insurance products, both existing and new, Aon’s Transformative Industry Trends report outlined.

The top 10 trends highlighted in the report suggest a huge growth opportunity for the insurance industry, to the tune of an estimated $200 billion.

At the root of all 10 trends is technology, which not only offers insurers the opportunity to grow their customer base and diversify, but also streamline their own operations.

Prescriptive analytics – where machine learning and data combine to create actionable insights and automated decisions – represents the largest megatrend re/insurance opportunity, the report stated.

The potential gross written premium (GWP) from prescriptive analytics alone is expected to exceed $100 billion by 2030, according to Aon’s analysis.

Because of its link to other trends, re/insurers should proceed with caution and careful planning, the report warned.

Shared mobility is the second largest area of growth potential for insurers. This includes “shared autonomous vehicles, hailed vehicles, car sharing and air taxis”, the report stated.

The shared mobility market has the potential to exceed $40+ billion in GWP by 2030.

Intellectual property (IP) and the Metaverse could each generate more than $20 billion in GWP by 2030, the report found, indicating IP, driven by a global economic shift from tangible to intangible assets, has been estimated to have reached around $60 trillion in value in 2022.

Aon’s research highlighted additional growth opportunities including carbon capture, carbon asset decommissioning, nature-based products and biodiversity, biotechnology, electrification and resilient infrastructure development.

“These megatrends each equate to risk and opportunity for the global insurance industry, and so as risk experts we cannot afford to sit on the sidelines and wait for these trends to crystalize,” said Sherif Zakhary, CEO of Aon’s Strategy and Technology Group.

Some innovation and expansion of capabilities will be required to embrace the opportunities outlined in the report.

“Megatrends (re)insurance opportunities can also be considered in terms of time and response,” the report stated. “Some trends are easier to grasp, require lower levels of investment and present more immediate opportunities. Others are more complex, with longer time horizons and higher levels of uncertainty.”

As future trends emerge, insurers will need to be more proactive rather than reactive to remain competitive in an evolving marketplace.

To understand the future landscape, “insurers will need to use intelligence and insights to anticipate global macro trends.”

“We have the technology and ability to anticipate the future landscape and develop innovative products and solutions to enable stakeholders to fulfill their biggest needs, from accessing new forms of capital to navigating emerging volatility,” Zakhary added.

To accelerate innovation and take advantage of new markets, he suggested insurers need to attract a broader range of talent and make use of technology, like advanced analytics.