The insurance industry like any other industry has seen various changes over the past many decades due to changes in demographics, climate and technology. Going forward the next three years also pose many challenges and opportunities for the firms involved in the sector. One of the biggest changes I predict going forward would be the rise in premiums for policyholders given the fact that factors such as terrorism and climate change have made the risk associated with underwriting policies much higher. In recent times we have seen events such as wildfires in both California and Australia as well as floods in India, hurricanes in the Caribbean wreak havoc and cause damage to both humans and wildlife and the costs associated with them. The probability of these events occurring again will only increase due to factors such as climate change and the insurance industry in particular have the great challenge of pricing policies accordingly to cover the costs.

Secondly I foresee the rise of autonomous driving and these vehicles being much safer than vehicles driven by humans. A number of vehicle manufacturers such as Tesla, Ford and GM have introduced autonomous driving vehicles and I believe this is an area of growth the insurance companies can benefit from due to the reduction in errors made. Moreover the use of technology in the function of the vehicle adds to the advantage of having data available to insurers and thus decreases the risk of fraudulent claims by unscrupulous customers.  On the other hand the fact that the cars are controlled by software increases the risk of cyber-attacks and thus increases the risk of unforeseen accidents and catastrophes taking place.

Thirdly the health insurance space is becoming interesting for the industry as people are becoming more healthy with the advent of gyms and fitness centres becoming the norm for the masses and in particular the cosmopolitan elite. This trend would reduce obesity by a considerable amount and significantly reduce the risk of coronary heart disease, diabetes, kidney/liver failure and cancer all of which can lead to ultimately death. The pay-outs would reduce significantly while maintaining a healthy premium intake by the insurers due to the peace of mind that customers seek .