Executive Summary
Artificial intelligence (AI) in commercial property and casualty (P/C) insurance is reshaping the responsibilities of underwriters and actuaries. A recent survey conducted by Coleman Parkes on behalf of hyperexponential reveals a significant reduction in the fear of job displacement due to AI among these professionals compared to previous years. This shift reflects growing familiarity and pragmatism regarding emerging technologies. However, while concerns about AI replacing jobs have diminished, challenges remain in the effective collaboration between underwriters and actuaries, as well as in maximizing the potential of AI and analytics tools.
Investment in pricing and underwriting technologies is nearly universal among insurers, with a strong focus on data and analytics capabilities. Yet, satisfaction with current tools is low, indicating a gap between expectations and delivery. This environment presents both opportunities and challenges for insurance companies, agents, and underwriters striving to leverage AI to improve decision-making, operational efficiency, and risk assessment. Understanding these trends and addressing skill gaps will be critical to advancing the insurance industry’s digital transformation.
Key Insights
Reduced Fear of AI Displacement Among Underwriters and Actuaries
The survey shows a marked decline in anxiety about AI replacing roles, with less than half of underwriters (48%) and actuaries (49%) expressing concern in 2025, down from over 74% in 2024. This signals a maturing perspective where professionals view AI more as an augmentation tool rather than a threat, underscoring the importance of adopting a forward-looking approach to AI integration.
Progress and Persistent Gaps in Collaboration
Underwriters now rank pricing actuaries as their second most effective collaborators, indicating improved cross-functional engagement. However, actuaries rate collaboration with underwriters less favorably, highlighting an ongoing disconnect. This asymmetry suggests that while communication channels have opened, actuarial models are still often developed without sufficient underwriting input, limiting their practical applicability.
Widespread Technology Investments Amid Growing Expectations
Nearly all surveyed insurers are investing in pricing, rating, and underwriting technologies over the next five years. Despite this, only 1% of respondents expressed satisfaction with existing tools, down from 22% two years prior. The rising expectations reflect insurers’ recognition of AI and automation as critical enablers of intelligent decision-making, but also signal dissatisfaction with current solutions’ ability to meet operational needs.
Operational Challenges: Data Management and Model Accuracy
Both underwriters and actuaries identify significant barriers related to data handling and model reliability. Common issues include excessive time on manual data entry, lack of real-time portfolio visibility, siloed data, and outdated pricing models. These challenges impede agility and accuracy in underwriting decisions, emphasizing the need for robust data governance and integrated technology platforms.
Skills Deficit and Burnout Concerns
A substantial majority of underwriters and actuaries acknowledge gaps in data analysis, reporting, and coding skills necessary to leverage AI effectively. Additionally, burnout is a mounting concern, driven by manual, repetitive tasks that consume up to three hours daily for underwriters. Addressing these human capital challenges is essential to sustaining productivity and realizing the benefits of technological advancements.
Insurance Industry Applications
Enhancing Collaboration Through Integrated Platforms
Insurance organizations can facilitate closer collaboration between actuaries and underwriters by deploying integrated pricing and underwriting platforms. These tools should enable joint model development and real-time feedback, fostering alignment and improving the accuracy and applicability of pricing models.
Targeted Training Programs to Bridge Skill Gaps
Developing comprehensive training initiatives focused on data literacy, AI fundamentals, and coding can empower underwriting and actuarial teams to harness emerging technologies effectively. Continuous professional development will help mitigate fears around obsolescence and reduce burnout by streamlining workflows.
Investing in Data Infrastructure for Real-Time Insights
To overcome data siloes and visibility issues, insurers should prioritize investments in centralized data lakes and advanced analytics solutions. Real-time portfolio monitoring and automated data cleansing will reduce manual effort and improve underwriting precision.
Addressing Tool Frustrations Through Vendor Partnerships
Given low satisfaction with current technology, insurers should engage closely with software vendors to customize solutions that fit their unique operational needs. Collaborative development and iterative feedback can help evolve tools from “some improvement” to fully optimized systems.
Prioritizing AI Adoption in Pricing and Underwriting
With two-thirds of respondents anticipating AI investments within 12 months, insurers must develop clear AI strategies that complement human expertise. Pilot programs that balance automation with expert oversight can accelerate adoption while maintaining control and transparency.
Conclusion and Recommendations
The 2025 State of Pricing report from hyperexponential highlights a pivotal moment for commercial insurance professionals. Underwriters and actuaries are increasingly embracing AI as an essential component of their roles rather than a replacement threat. However, to capitalize on AI’s promise, insurers must focus on fostering effective collaboration, upgrading technology infrastructure, and addressing skill gaps and workforce well-being.
Insurance executives should champion initiatives that integrate actuarial and underwriting functions more tightly and invest in data-centric tools that deliver real-time insights. Simultaneously, cultivating a culture of continuous learning and innovation will equip professionals to thrive alongside AI. By strategically aligning technology investments with human expertise, the insurance industry can accelerate intelligent decision-making and reinforce its competitive edge in a rapidly evolving landscape.
For a comprehensive overview of these findings and insights, the complete report is accessible at Carrier Management’s article on underwriter and actuary AI perspectives.