Moody’s has published a report on 20 emerging risks that will shape the future of insurance. 

The risks include artificial intelligence, physical climate peril, social inflation, quantum computing and infectious disease/pandemic. 

Moody’s says the emerging risk radar report “connects the dots” to show how, where and even when these trends will impact the industry. 

“Rather than assessing these developments in isolation, the framework highlights the relationships between risks and the ways they can amplify or influence one another,” Moody’s said. 

“The underlying premise is that the future of insurance will be shaped not only by traditional industry dynamics, but also by broader global forces that extend well beyond the sector itself.”   

According to the radar, AI is both a major opportunity and a significant risk for insurers. 

“The technology can make underwriting and claims handling more efficient, but can also lead to model errors, algorithmic bias, and AI-enabled cyber threats,” the radar says. 

“AI-related losses and litigation are already emerging. Since many existing policies neither clearly cover nor exclude AI-related losses, some insurers may also face ‘silent’ AI liabilities. 

“Growing dependence on a small number of AI providers creates potential systemic risk, while AI could reshape insurance distribution and intensify competition.” 

The radar grades severity of AI risk as “high” and immediate with impacts on insurance across property and casualty, life and health.

See the full report here.