Insurance CFOs driving the industry’s transformation
Insurers failing to meet expectations risk losing market share to more agile, tech-enabled players. For CFOs, this means directing investment towards scalable digital infrastructure.
Australia’s insurance sector is undergoing a generational transformation. Macro trends such as digital acceleration, AI, escalating climate risks, sustainability of key insurance products, and an increasingly complex regulatory landscape are reshaping how insurers operate and serve their customers.
At most insurance providers, the Chief Financial Officer sits at the centre of this shift. In addition to their core financial responsibilities, CFOs today are increasingly called upon to help lead strategy, navigate disruption and unlock long-term value across the organisation by enabling business-critical decisions.
Doing this effectively requires careful thought about how trends shaping the insurance sector should guide investment decisions. Deloitte’s Growth in Insurance Series: 2025 Insurance Predictions shines a light on these trends and examines the strategic shifts insurers must make to remain competitive and relevant.
Within this, the digital battleground is one of the most compelling frontiers. Seamless digital experiences are no longer a competitive advantage. Rather, they are now the minimum standard for market players. Customers are no longer benchmarking against other financial institutions, but against the best digital platforms they use.
Insurers that fail to meet these expectations risk losing market share to more agile, tech-enabled players who can offer greater personalisation.
For CFOs, this means directing investment towards scalable digital infrastructure that supports real-time data use, hyper-personalised services and AI-powered contact centres. At the same time, they must ensure successful transformations by driving accountability through robust cost governance and performance metrics that reduce cost-to-serve while improving engagement.
Separately, AI presents both a remarkable opportunity and a formidable challenge in areas outside of customer engagement and personalisation. The early hype is giving way to real pressure.
By 2026, the focus will shift firmly to scaled implementation of AI, especially across underwriting, claims automation and compliance, where it can drive measurable improvements in accuracy, efficiency and responsiveness.
The potential benefits of AI to the CFO are substantial and often overlooked in initial business cases. By applying AI to financial operations, insurers can achieve faster and more accurate closes, streamlined consolidation and higher-quality reporting.
To succeed, insurers must align AI deployment with core business strategy and tie it to outcomes such as improved underwriting accuracy, faster claims automation and stronger fraud detection.
This requires investment in scalable architectures that integrate diverse data sources and support advanced agentic AI, alongside governance frameworks that ensure security, transparency, ethical use and regulatory compliance.
But this won’t be a frictionless process. Talent shortages, regulatory scrutiny and gaps in technical understanding remain significant obstacles.
CFOs will need to lead this transformation by supporting the modernising of systems, building integrated cloud-based infrastructure and enabling stronger collaboration across finance, risk, and operations to ensure proper business led transformations to be a success.
They must also support investment in the capabilities needed to close these technological skill gaps through upskilling, external partnerships, or strategic hiring.
As technology shifts accelerate, the regulatory environment is evolving just as rapidly. The implementation of IFRS 17, along with the incoming Financial Accountability Regime (FAR) and CPS 230, are pushing finance and risk teams toward a more strategic role.
Finance must now serve as a generator of actionable insights. Looking at compliance as an opportunity rather than a box ticking exercise will deliver better decisions under pressure and ensure agility in an environment where rules are continually changing.
The final trend shaping the industry is climate risk. This is no longer a future scenario, it is a balance-sheet issue, now.
Billion-dollar insurance events have become commonplace, with 2023 Deloitte analysis showing that since the 1960s, 20 extreme weather events have caused over $1 billion in insured damages (indexed to 2022 values), with 15 of these occurring since 2010. As the frequency and severity of natural disasters increase, catastrophic impacts will worsen.
This escalating risk puts pressure on underwriting, coverage and return on capital. CFOs must lead by integrating climate risk across the value chain to ensure financial resilience.
Working with actuaries and external partners, CFOs need to support the adoption of advanced analytics and scenario modelling to understand and assess risk quicker and more accurately. Equally important is leading collaboration with complex sets of stakeholders. For instance, general insurers must work alongside industry bodies and governments on disaster funding, reinsurance and incentives to encourage customer investment in risk mitigation.
In this environment, the role of the CFO across the insurance sector is expanding in every direction. It demands broad technology literacy, deeper involvement in regulatory strategy and a clear-eyed view of climate’s financial implications.
At the same time, CFOs must continue to create positive financial resilience as they manage volatility and preserve financial discipline in an uncertain economy.
In 2025, insurance CFOs must move beyond managing complexity, they must lead through it. CFOs who succeed will stabilise their organisations through a period of transformation and position them to thrive in what comes next.
Max Murray is National Insurance Leader at Deloitte Australia.
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