In 2025, the insurance industry is facing a turning point. A sector long defined by technical precision and steady progress is now operating in a much more unpredictable environment. Technology is advancing faster than most teams can adapt. Regulatory demands are intensifying. And customer expectations are evolving far beyond what legacy systems were designed to support. At the centre of it all is a common thread: capability.
For boards, senior leaders, and L&D teams, the question is no longer whether upskilling is important — it’s where the biggest gaps are, and how quickly they can be addressed. The companies making progress today aren’t reacting to change — they’re building capability as a long-term advantage.
Why Skill Gaps Are Top of Mind for Insurance Leaders
Leaders across the industry are seeing first-hand how capability gaps impact performance:
- 70% of leaders say business performance is suffering because employees lack necessary competencies (Businesswire, 2024)
- Only 1 in 3 insurers have a formal AI training programme in place (Insurance Times, 2025)
- Less than 20% of cyber insurance underwriters have formal cybersecurity training (The Insurer, 2025)
- Only 40% of companies feel prepared to comply with ESG regulations (LeanIX, 2024)
What’s Driving Change?
Before addressing the solution, it's worth understanding what's pushing these capability gaps to the top of the agenda.
- Automation Is Already Here
AI, machine learning and intelligent systems aren’t “emerging tech” anymore — they’re already shaping pricing, claims, and customer engagement. This shift demands new levels of digital understanding across the organisation.
- Customer Expectations Have Shifted
People expect clear, responsive, and personalised experiences. Meeting those expectations means rethinking how teams communicate, deliver, and build trust — especially in moments that matter.
- The Risk Landscape Has Evolved
Cyber threats, climate instability, and geopolitical risk aren’t niche concerns. They’re core to modern underwriting. Yet many teams still lack the breadth of knowledge to respond effectively.
- Compliance is Becoming a Capability Issue
Whether it’s AI regulation, ESG reporting, or data ethics — compliance isn’t just a legal function. It requires operational awareness and decision-making at all levels of the business.
- The Workforce Itself is Changing
With shifting generational expectations and increasing demand for flexibility, career development, and purpose, firms must do more than offer a training budget — they need to create meaningful growth pathways.
The Skill Gaps That Matter Most Right Now
The capability gaps keeping leadership up at night include:
- Uneven digital skills, particularly in roles that were never expected to be tech-focused
- A lack of confidence in working with AI tools and outputs
- Cyber knowledge limited to IT, creating risk blind spots in key functions
- ESG literacy that remains isolated within specialist teams
- Weakness in communication, ethical decision-making, and collaboration — especially in hybrid or remote environments
- An underdeveloped culture of learning — where development is ad-hoc, not embedded
Where Insurance Leaders Are Focusing Their Efforts
While tech investments have accelerated, many insurers are still catching up when it comes to people capability. The firms making the biggest strides are those treating skills development as a leadership issue — not a box-ticking exercise. Below are six areas where we’re seeing real momentum:
- Raising Digital Fluency Across the Business
Digital capability can’t sit with one team. Leaders are prioritising baseline fluency across every function — not to turn underwriters into engineers, but to help them work more confidently and efficiently with tools that now underpin day-to-day decisions.
Audits, role-specific training, and scenario-based learning are helping teams move beyond basic tool usage into real operational confidence. It’s not about being a tech expert — it’s about being able to engage with the systems shaping your work.
Key actions:
- Audit digital fluency by department
- Create tailored training based on actual workflows
- Use real-world simulations to build confidence
- Include digital onboarding for all new roles
- Making AI Competency Practical, Not Theoretical
AI is already influencing underwriting, fraud detection, and customer insights — yet most employees still view it as a black box. Leaders are focusing on closing this gap, helping teams understand how to engage with AI, question its outputs, and recognise its limitations.
Executive teams are also taking responsibility for their own understanding — knowing that if leaders can’t talk confidently about AI, no one else will either.
Key actions:
- Tailor AI training to specific functions
- Run internal case studies on success and failure
- Encourage cross-functional forums for AI learning
- Equip senior leaders to model AI literacy
- Building Cyber Awareness Beyond IT
The risk posed by cyberattacks isn’t limited to the security team. As insurers expand digital offerings and cyber products, leaders are recognising the need to spread foundational cyber knowledge across underwriting, claims, product, and more.
This means moving away from generic e-learning and towards hands-on training that’s relevant to the way different teams operate.
Key actions:
- Develop role-specific cyber training for non-technical staff
- Conduct cross-functional cyber incident simulations
- Integrate cyber risk into new product development
- Encourage broader certification uptake outside of IT
- Bringing ESG Into the Everyday
For years, ESG has sat with specialist teams. In 2025, leaders are taking a different approach — embedding ESG thinking into decision-making across the business. That means underwriting teams understanding climate risks, procurement teams managing sustainable suppliers, and investment teams aligning with policy goals.
Firms doing this well are transparent about expectations, set measurable ESG KPIs, and provide ongoing support to help teams meet them.
Key actions:
- Make ESG learning relevant to each business unit
- Appoint ESG champions across departments
- Link ESG knowledge to performance reviews
- Share updates and progress regularly to keep it front of mind
- Reinvesting in Human Skills
With machines taking over admin and analysis, what’s left is what only people can do: collaborate, communicate, think ethically, and lead. These aren’t “soft skills” — they’re essential. And they’re becoming harder to find.
Leaders are putting structure around these skills again — bringing them into feedback loops, leadership development, and even hiring decisions.
Key actions:
- Integrate behavioural skills into leadership and graduate programmes
- Use 360 feedback for ethical and interpersonal competencies
- Pair mentoring and reverse mentoring to broaden perspectives
- Recognise inclusive and ethical behaviours as performance indicators
- Making Learning Part of the Culture
Upskilling isn’t a single initiative — it’s a way of operating. The most agile firms are moving away from mandatory modules and towards cultures where learning is ongoing, peer-led, and tied to meaningful growth.
Leaders are investing in learning platforms, clear career pathways, and communities of practice. But more importantly, they’re making learning visible — celebrating it, incentivising it, and expecting it from the top down.
Key actions:
- Tie learning outcomes to career progression
- Offer curated, on-demand content for every role
- Create spaces for peer-led workshops and sessions
- Build visible internal pathways linked to capability development
Building Insurance Talent That Can Outlast Disruption
The future of the insurance workforce won’t be defined by a single skill or system. It will be shaped by how effectively organisations prepare their people to learn, adapt, and lead in unfamiliar terrain. Upskilling is not simply a defensive strategy for responding to change — it is how insurers build resilience, unlock innovation, and preserve the relevance of their value proposition.
In an environment where talent shortages, customer demands, and regulatory expectations converge, workforce capability is the differentiator. For boards, leadership teams, and L&D professionals, the path forward starts with honest assessment and intentional action. The future of insurance will belong to firms that treat skills not as a gap to be filled, but as an asset to be cultivated.
