Insurance software market to climb 7.8% CAGR by 2028

Australia’s heightened rules pose challenges to insurer requirements.

The world’s insurance software market size is projected to climb by $7.53b with a compound annual growth rate of 7.81% from 2024 to 2028.

This growth is driven by increasing government regulations in developing countries, which mandate insurance coverage and compel insurers to adopt advanced software solutions for compliance, according to Technavio. 

Additionally, the integration of wearable technology into life insurance is boosting market expansion by enabling personalized services.

The insurance software market is also benefiting from the demand for comprehensive cybersecurity solutions to mitigate fraud and address cybersecurity concerns. 

However, challenges remain due to regulatory bodies like Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) in Australia, and the National Association of Insurance Commissioners (NAIC) in the US, which are establishing and enforcing stricter regulations. 

The NAIC's Own Risk and Solvency Assessment (ORSA) poses additional requirements for insurers. The need to update offerings to ensure compliance presents challenges to market growth.

The digital transformation of the insurance industry brings operational costs, complexity, and integration challenges with legacy systems. 

Cybersecurity remains a major concern, necessitating robust solutions to protect against cyberattacks and threats. 

Advanced risk assessment tools and regulatory compliance are crucial for comprehensive coverage, policies, and pricing models. 

Scalability and flexibility are essential to adapt to the evolving insurance landscape, with cloud technology playing a vital role in meeting demands and managing policy and claims processing.