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The future of insurance: A look at the risk landscape of 2025

Over the next decade, the insurance and third-party administrator landscape will continue to evolve.

And while it is impossible to predict the top challenges that will face risk buyers, intermediaries, TPAs and insurers so far into the future, it is interesting to gaze into the crystal ball. Here is a look at the top risk trends and challenges facing insurers and their stakeholders over the next decade. Understanding these will help buyers and intermediaries select insurance and TPA partners that can help them today and far into the future.


Insurance buyers will likely face three key market realities that shape their risk programs:

Customer demands. Buyers will need to respond to their customers’ increasing demands for simplicity, speed and convenience. Before building new business processes and technical infrastructures to meet these expectations, buyers will need to fully understand the risk implications of potential technologies and workflows, and how to manage and mitigate those exposures.

The need for value. Smart insurance buyers will demand even greater value from intermediaries in two important areas: loss prevention and claims management. On the workers’ compensation side, buyers will likely become even more interested in how brokers, insurers and TPAs produce better outcomes for injured workers given the potential continuation of medical inflation, which the PwC Behind the Numbers 2017 predicted could escalate above current levels.

Data directs action. Big data is a sea change whose waves will continue to be felt in 2025. Buyers will look to intermediaries, insurers and TPAs as data translators that add value by uncovering actionable information to improve risk performance. The difference in 2025 will be the scale of data available and the ever more sophisticated analysis required to find key learnings that improve the performance of both programs and claims.


Agents and brokers will also face key challenges in the years ahead, including:

A smaller, more competitive market. New online choices will emerge for buying insurance. At the same time, M&A activity will likely lead to fewer intermediaries, given the need for scale, expertise and customization required to meet buyers’ needs. With the narrowing of the market, intermediaries will look to insurers and TPAs for help identifying and pursuing new business opportunities.

Greater competition also will require stronger demonstrations of value. For example, intermediaries are in a unique position to deliver deeper insights through predictive models to spot specific opportunities to improve performance. Intermediaries will also add value by educating clients on market trends and new innovations to manage the total cost of risk, like wearable technologies that can positively impact workers’ compensation and general liability claims.

By 2025, a large part of an intermediary’s success may likely come from helping buyers focus on value rather than price when developing insurance programs. Premiums will always be important, but are a narrow part of total insurance costs, typically about 20 percent when claims and other associated loss and adjustment costs are included.

TPAs and insurers:

For their part, successful insurers and TPAs in tomorrow’s risk landscape will focus on adding value to both intermediaries and buyers. This value will stem largely from:

Data and analytics.

This is already happening, as seen in the growth of sophisticated data analytics operations embedded within some insurers’ claims, product development and other functional areas. By 2025, successful insurers and TPAs will have even more robust data analytics and reporting capabilities that improve program and claim performance.

Consultative selling.

At the account level, successful insurers will focus on a consultative sales process to identify the total risks faced by a specific account and the best ways to manage and mitigate them. They will also deliver loss prevention services that improve safety to prevent claims, and claims management that provides the best possible outcome when an accident happens.


Insurers and TPAs will continue to add value by helping both intermediaries and buyers understand key market trends and issues from workers’ compensation implications of an aging workforce to the increasing demand in general liability claims for life care plans.

In order to maximize their opportunities and prepare for the future, buyers and intermediaries will need to identify insurance companies and partners who can help them manage the trends of tomorrow’s market.

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