Cyber, AI and Technology are largest risks for global insurance sector
Technology disruption and macroeconomic uncertainty are driving higher levels of anxiety among insurers in Singapore compared to their global peers. That is according to global research from PwC.
Now in its tenth edition, the ‘Insurance Banana Skins’ report from PwC evaluates the most urgent risks facing the insurance industry, based on perspectives from practitioners and observers around the world.
Consistent with global findings, Singapore respondents identified cyber crime as the number one risk. Cyber crime has consistently ranked among the top risks for Singapore insurers since 2017, and its elevation to first place in 2025 reflects the sector’s expanding technology footprint, deeper reliance on third-party and cloud ecosystems, and increasingly sophisticated threat actors who leverage generative AI to enhance the scale and speed of their attacks.
The survey also highlights the sharp rise of Artificial Intelligence (AI) as a broad concern for insurers. Previously ranked number 7 in the top 10 local risks in 2023, AI has moved into the second-highest position. Beyond amplifying cyber threats, respondents identified broader AI challenges such as its dynamic development, which is difficult to monitor and spans multiple components and vendors.
“These evolving risks necessitate continuous evaluation and governance, underscoring the need for trust, control and assurance frameworks to evolve at the same pace as adoption,” said Ang Sock Sun, Insurance Leader at PwC in Singapore.
Respondents in Singapore meanwhile showed greater sensitivity to macroeconomic headwinds than global figures, reflecting Singapore’s status as a trade-dependent, globally connected financial hub, where tariff movements, currency divergence and capital-flow fluctuations have a direct bearing on operating confidence and strategic planning.
With technology-linked and macro-driven risks commanding greater immediate attention, human capital has fallen to fifth place in 2025, but remains among Singapore’s top five risks, where key challenges include the aging workforce, and competition for scarce data, engineering, and actuarial skills.
“Insurers in Singapore stand at a crossroads where both continued and emerging challenges like cyber threats, macroeconomic volatility, and rapid technological advances demand a re-evaluation of traditional strategies,” noted Sock Sun.
Asked how insurers can stay resilient in this complex and rapidly evolving landscape, she added: “The focus must shift toward integrating AI-driven solutions, enhancing cyber resilience, and recalibrating economic strategies.”
“To stay ahead, insurers should not only align with regulatory compliance but also advocate for a risk-sensitive, future-oriented framework that balances innovation with protection. As anxiety levels remain high, collaborative foresight and adaptability will be the keystones that define success in securing a sustainable and profitable future for the industry.”
PwC first released its ‘Insurance Banana Skins’ report in 2011. The latest edition was based on nearly 700 respondents from 40+ countries.
