UK Insurers‘ AI Plans Hampered by Data issues, Report Finds
LONDON – The rollout of artificial intelligence within UK insurance firms is being significantly slowed by poor data quality, according to a new report. Nearly three-quarters (72 percent) of underwriters cite fragmented and unstructured data as the biggest obstacle to AI transformation, revealing a critical challenge for the sector as it seeks to leverage the technology for efficiency gains.
The report, conducted by tech firm CI&T in collaboration with Reuters Events, highlights that accurate risk assessment and pricing accuracy are also major concerns, cited by 42 percent and 36 percent of respondents respectively. Professionals identified difficulty extracting, analysing, and utilising unstructured data as the largest hurdle to optimizing data – a challenge flagged by 54 percent. Further issues include consolidating data sources (24 percent) and a lack of data literacy among employees (14 percent).
“AI’s success in insurance won’t be steadfast by how advanced the algorithms are, but by the quality and accessibility of the data that feeds them,” said Mike Young, vice-president of insurance industry growth at CI&T.
The findings come as insurers face increasing pressure to control costs, with 60 percent of respondents believing AI-led efficiency will be crucial to offset rising claim costs and premiums. Claims inflation peaked at 12 percent in 2023 and is expected to remain a key risk for UK insurers in 2025 across property, casualty, and motor lines, driving the increased interest in technology.
“this research shows UK insurers are ready to innovate, but they need to get their data house in order first,” Young added.
