Expert predictions for 2025 Insurance technology trends
As we move into 2025, the insurance industry faces unique opportunities and challenges. From regulatory changes to evolving cyber security threats, insurers must adapt to remain competitive.
We spoke with Stuart Favier, Insurance Client Manager at Northdoor, who shared his perspective on key trends and actionable advice for the year ahead. Stuart’s focus is clear: helping insurers leverage technology to overcome challenges, stay secure, and meet growing regulatory demands.
Here’s Stuart’s take on the issues shaping 2025
Lloyd’s Blueprint Two: reshaping the London Market
Lloyd’s Blueprint Two will continue shaping the London Market insurance sector in 2025. However, the launch date of phase one of Blueprint Two digital services (including the Digital Gateway) is still unknown, following a number of setbacks and delays experienced on the project.
Understanding the delay
Blueprint Two is a multi-phased digital transformation that will replace and upgrade existing services with a new digital platform. The new platform will support processing services for open market and delegated authority business and will be delivered in two phases. The delay is due to challenges with testing, including onboarding and integration issues, with Lloyd’s and Velonetic wanting to ensure a secure cutover and market readiness.
Despite the setbacks, this delay provides a valuable opportunity. Organisations now have more time to prepare for phase one. Additionally, it allows for longer planning of the more complex phase two changes. Rather than pausing efforts, companies should use this time to enhance their digital transformation plans. For those facing unique challenges, third-party IT consultants such as Northdoor can help. We offer expertise to navigate full digital integration during this extended timeline.
Navigating the challenges
For many organisations, adopting Blueprint Two is a daunting and costly process. Fortunately, alternative compliance solutions exist. Northdoor’s Alternate solutions helps London Market carriers meet Blueprint Two requirements without undergoing a full digital transformation. Importantly, it requires minimal changes to operations, processes, or IT systems. Moreover, it allows organisations to transition at their own pace. This ensures access to digital message data while gradually adopting a fully digital ecosystem.
Sanctions breaches in the insurance sector
The insurance sector is facing an increasingly complex sanctions landscape. Banks are being asked to keep constantly up-to-speed with changing sanctions lists. It is also clear that the FCA is stringently policing and enforcing sanctions.
For example, Starling Bank has been fined £29m for failings in financial crime systems, which saw the bank open 54,000 accounts for 49,000 high-risk customers between September 2021 and November 2023. This massive fine needs to act as a wake-up call for the insurance sector.
Sanctions and watch lists are huge and ever-changing, so ensuring that you adhere to them is complicated and time-consuming. Monitoring these lists manually is no longer a viable approach. Our Sanctions Checker solution can help organisations to implement technology to automate this process, saving time and improving accuracy.
Cyber security in 2025: a critical focus
Innovative tools now fuel cyber threats, many utilising AI, meaning the tactics threat actors deploy have become increasingly sophisticated. This means organisations must balance the need to protect themselves with investing in costly cyber protection.
Organisations of different sizes will also have varying cyber security requirements. While still being a target, an SME or startup may not need the extensive security infrastructure a large, multi-layered enterprise would. This means there is no ‘one size fits all’ solution for any business.
Northdoor can help insurers to implement the correct level of protection for them. Solutions such as Managed Detection and Response (MDR), Managed Risk, Managed Cloud Monitoring, Managed Security Awareness and Security Operations as a Managed Service will be crucial to securing security posture in 2025.
DORA: strengthening Digital Operational Resilience
The Digital Operational Resilience Act (DORA) will come into force from January 2025. It applies to banks, insurance companies, investment fund managers, e-money institutions, crypto-asset service providers, crowdfunding platforms and investment firms. Some of the provisions of DORA also apply directly to certain ‘critical’ third-party Information Communication Technology (ICT) service providers.
DORA focuses on boosting business resilience to technology-related risk, such as disruption to operations and data loss. This highlights the importance of aligning an organsation’s internal team with evolving security requirements to ensure robust protection and compliance.
Third-party cyber security risk management
With ever-increasing regulatory requirements (such as DORA), third-party security risk management will be crucial for the insurance sector in 2025. Third-party security risk management is used to continuously monitor external data feeds or monitor third-parties for changes in risk or performance. It can identify high-risk third-parties or suppliers that pose the greatest risk to an organisation.
Third-party cyber risk management is vital to any insurance organisation to identify cyber security risk, operational risk, and financial risk. Northdoor can help implement a comprehensive framework for compliance and cyber security resilience, safeguarding data, protecting against financial and operational damage, and guaranteeing compliance.
The role of continuous innovation
Continuous innovation will be essential for the insurance sector in 2025. In 2024, we have seen organisations increasingly waking up to the benefits of technology, not only from a business perspective but from a regulatory one. Security Operations as a Managed Service (SOC-as-a-service) and Third-Party Security Risk Management can help meet regulatory requirements (such as DORA) as well as protect business interests.
Integrated systems
Integrated systems and Artificial Intelligence (AI) will be play a pivotal role in 2025. The insurance sector will need to look at implementing a range of ecosystems that talk to each other via Application Programming Interfaces (APIs). API integrations are the data connections that allow multiple applications or services to communicate with each other through their respective APIs. Without these integrations, the different applications, microservices, micro apps, and Software-as-a-Service (SaaS) platforms that make up larger IT ecosystem would be unable to communicate and interact.
Effective API integration goes beyond simply connecting two systems. It requires strategic planning, precise execution, and continuous management. By leveraging scalable API management solutions, third-party IT consultants can help insurance providers share and access data and functionality across platforms, ensuring seamless integration and improved operational efficiency.
Artificial Intelligence
AI technologies will continue to progress in 2025. Forrester highlights that while many organisations initially pursued AI for quick wins and rapid ROI, they often underestimated the importance of a long-term strategy and robust data management practices. Simply put, there are no shortcuts to achieving sustainable AI success.
However, 2025 is poised to be a turning point, with businesses expected to deliver tangible ROI and measurable value from their AI initiatives. Success in AI-driven automation will hinge on integrating innovative AI capabilities with the scalability and reliability of established automation tools, underpinned by support from third-party IT consultants.
Conclusion: embracing change for competitive advantage
“If I had to give one piece of advice, it’s this: Use technology not just to meet regulatory demands but to secure your business’s future. Whether it’s integrating systems, adopting AI, or strengthening your security, the right tools can transform challenges into opportunities.”
By leveraging the expertise of third-party IT consultants like Northdoor, companies can ensure compliance with new regulations and gain a significant competitive edge. The key to success lies in adaptability, strategic planning, and a commitment to digital resilience. Those who view these changes as opportunities for improvement rather than mere compliance hurdles will be best positioned to thrive in the evolving digital ecosystem of the financial services industry.