You’re just about as likely to find a commercial P/C underwriter
or actuary who is unconcerned about the increased use of AI in insurance as you are to find one that’s afraid of being replaced by AI.
That’s what a recently published report from hyperexponential, an AI-powered pricing and underwriting platf
orm, showed based on a survey of 350 U.S. and UK underwriters and actuaries working in commercial and spe
cialty insurance conducted on the firm’s behalf by Coleman Parkes in September.
Just over half of the survey takers—51 percent of the actuaries and 52
percent of the underwriters—said they were not worried at all or hadn’t considered the prospect of being replaced by AI.
According to hyperexponential, a key takeaway from the survey response snapshot is the marked difference be
tween responses this year vs. responses to a similar survey in 2024.
“Less than half of underwriters (48 percent) and actuaries (49 percent) now fear being replaced by AI, down from
74 percent and 80 percent, respectively, in 2024, suggesting an increasing understanding, ease and pragmatism a
round emergent technology and how it’s shifting the roles of insurance professionals,” the tech firm said in a media statement about the report.
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For both groups, just over one-third of respondents said they have considered the issue of being replaced by AI but that they are not worried at all.
Beyond information about what it terms “FOBO”—fear of becoming obsolete—the “2025 State of Pricing” report reveals trends in insurer tech and automation in
vestments and provides insights on the degree of collaboration between actuaries and underwriters, as viewed from the perspective of each camp.
Noting the collaboration between the two groups of professionals “has long been an aspiration,” the report suggests that t
his year’s survey indicates real progress. In support of this, the text of the report notes that underwriters ranked pricing actuaries second, just behind operations
professionals when asked how effectively they collaborate with other functions. In the previous (2024 State of Pricing) report, underwriters ranked pricing actuarie
s dead last among collaborators within the companies.
Still, “the inverse remains challenging,” the report says, noting that only 9 percent of actuaries asked about underwriter collaborations ranked them as “very effective.”
“Actuaries build models for underwriters but too often not with them,” the report says.
Charts in the report show that underwriters scored the effectiveness of collaborations with pricing actuaries at 3.5 out of 5, on average. Actuaries put th
e collaboration ranking score at 3.1 out of 5. That was lower than scores for operations, legal and finance professionals.
Responding to a different survey question—about barriers to maintaining and deploying pricing models—38 p
rcent of actuaries cited “lack of underwriter or business buy-in” as an obstacle. Meanwhile, 45 percent of underwriters
said that “pricing models are inaccurate or out of date” when asked to identify barriers to optimal underwriting.
Investments Grow
Much of the report focuses on technology-related investments insurers are making and existing problems they have with the tools they are using.
“Nearly every insurer surveyed identified pricing and underwriting as top priorities for technology investment, showing increased recognition that these functions are the critical engines of intelligent decision-making,” wrote Amrit Santhirasenan, chief executive officer and co-founder of hyperexponential, in a forward to the report.
According to the survey, 100 percent of actuaries surveyed are investing or planning to invest in pricing and rating technology within the next five years, while 98 percent of underwriters are investing or planning to invest in underwriting workbench solutions with the next year.