Let’s go to Kathmandu. The global insurance industry is poised for major changes in 2026. This is because insurance companies are focused on improving customer experience, expanding cyber coverage and increasing microinsurance offerings.
According to Forrester’s Prediction 2026: Insurance Report, cyber insurance is expected to grow by 15 percent next year due to threats related to increasing AI. “The cyber insurance market, which experienced rapid expansion between 2017 and 2022, will slow as it matures,” the research firm said. However, the widespread use of AI will revive demand. ’
Insurance companies will need to take a more active role in cyberdefense, beyond paying claims, introducing risk mitigation tools, and introducing new underwriting models to manage AI-related risks. On the customer experience front, Forrester estimates that the three major property and casualty insurance companies will double their investments in customer experience improvement in 2026 to rebuild trust and improve retention.
According to the report, the customer satisfaction score of auto and home insurance companies in the US and Canada declined again in 2025. “To recover customer satisfaction scores, insurers will need to explain rate increases more transparently, offer personalized policy options, and simplify claims and self-service processes,” the report suggested. ’
Meanwhile, microinsurance is expected to expand by 5 percent on the back of rising demand for gig and freelance workers. Forrester predicts that by 2025, the global gig economy will exceed 600 billion. However, insurance coverage for this group is limited.
The report recommends insurance companies improve education, simplify onboarding, and design affordable, modular products through digital channels that adapt to flexible work patterns. “AI will be both a weapon and a threat as the market for cyber coverage rapidly expands,” said Rohit Makhijani, chief analyst at Forrester. New underwriting will open up high-risk markets, and the growing gig economy (short-term economy) will create new microinsurance opportunities. ’
Makhijani added, “Leaders must embrace AI-powered operational efficiency to stay ahead of the competition. Invest in improving customer experience and adapt to emerging market segments. ’
