NTT DATA warns insurance faces rising cyber, climate and liability risk

NTT DATA’s Insurtech Global Outlook 2026 landed with a hard warning: insurance risk is moving faster than the systems built to absorb it. The report said cyber protection has become the single largest source of uninsured risk, with losses projected to climb from $171 billion in 2023 to more than $700 billion by 2030, while climate-related uninsured losses from extreme weather, floods and wildfires already total $180 billion.

Liability is tightening the squeeze too. NTT DATA said liability claims have risen 57%, a figure that lines up with Swiss Re Institute’s finding that U.S. liability claims have increased 57% over the past decade, driven largely by social inflation and larger court verdicts. In other words, the pressure is not coming from one line of business or one type of event. It is showing up across cyber, catastrophe and litigation at once, and that is exactly the kind of multi-front stress test legacy policy, billing, claims and analytics platforms were never built for.

The report also made the AI gap impossible to ignore. NTT DATA said AI-native and agentic operations could cut costs by as much as 35% through automation and process optimization, yet only 22% of insurers have moved AI into production even though 66% of the insurance workforce has already adopted AI tools. The bottleneck is no longer access to tools, NTT DATA argued, but trust, governance and operating models that were not designed for AI. For carriers, that means the next procurement cycle is less about adding another point solution and more about whether core platforms can support model governance, explainability, human accountability and repeatable controls.

That pressure is also reshaping growth strategy. NTT DATA said the embedded insurance market exceeded $116 billion in 2025, underscoring how distribution is moving into ecosystems instead of standalone channels. It added that U.S. insurance IPOs reached a 20-year high and startup debt financing hit $9.5 billion, surpassing equity funding, a signal that capital is still flowing to firms with scalable technology and disciplined economics.

NTT DATA said its outlook drew on insurer disclosures, third-party research, market trends and its own insights covering 2023 to 2025. The practical takeaway for carriers is clear: resilience now depends on software that can ingest live data, manage exposure continuously, govern models tightly and reconfigure products faster than risk conditions change.