People challenges
Operational challenges
Market disruption
Operational risk now tops the list. Businesses are under increasing pressure to demonstrate resilience in the face of continued economic and political instability. Leaders are focused on developing robust, adaptable models that can respond to regulatory shifts, supply chain disruptions and broader systemic shocks. Investors are particularly focused on sectors facing heightened regulatory or operational challenges, where the margin for error is slim.
People-related risks have also been ranked as a top concern, particularly as the post-pandemic workplace continues to evolve. Return-to-office (RTO) policies are a key source of tension, with 40% of respondents reporting that such mandates hinder innovation and talent development. Legal risks are rising too, as inflexible RTO policies may breach remote work agreements or lead to discrimination claims. With differing legal standards and cultural expectations around work across jurisdictions, global organisations must approach this area with care and flexibility.
The challenge for organisations is to ensure that they have the right organisational measures and controls in place for leaders and employees when it comes to AI. Organisations need to have the right guardrails in place to support employees as they use these tools because, as the findings of this year’s report shows, AI, or machine learning, can be both incredibly powerful and potentially destructive at the same time.
Italy’s key carriers are poised to push for greater market share, reshaping its retail insurance space, while Germany’s long-quiet mutual market is undergoing a wave of mergers, spurred by regulatory changes like DORA and CSRD. Meanwhile, multinational carriers are scrutinising Central and Eastern European books, potentially driving consolidation, especially in Poland.
Technology integration remains a barrier to multi-territory acquisitions, with majors wary of high costs and DORA compliance risks.
MGAs remain in high demand, with major players like Allianz and Swiss Re increasing investment. 2025 looks promising for entrepreneurial underwriters, though carrier startups face tougher funding conditions, as struggles from WeFox and others have made investors cautious.
Isabel Simpson, Partner, London
Finding talent, retaining that talent, and then developing talent with careers is a big focus and a material risk. It’s difficult to attract talent, particularly in the UK.
Lee Callaghan, General Counsel – Group Centre & International, Aviva, United Kingdom
Global economic volatility, market uncertainty and changing consumer behaviours have pushed market disruption higher on the corporate agenda. Organisations must ensure continuity amid these shifts, investing in agile planning, resilient supply chains and locally responsive operations. Success increasingly depends on the ability to adapt quickly, plan strategically and remain flexible in the face of change.
The world is not going back to globalisation. We are seeing more regionalisation, driven by geopolitical tensions and supply chain issues. Companies are realising that the globalisation that has been the bedrock of their operations for the last 20 years is being dismantled.
Ben Knowles, Partner, London
