AI adoption continues to accelerate, but data protection and AI errors remain key risks for insurers
Global adoption of AI continues to accelerate, with 82% of companies worldwide reporting a positive impact of AI on their operations. However, data protection and system errors remain key challenges, according to research from insurance broker Gallagher.
A survey of 1,200 companies worldwide shows the rapid integration of AI into operations. 63% of businesses have fully implemented AI in individual departments, compared to 45% in 2025. The main areas of application are IT operations, customer functions and analytics.
Confidence in the technology’s financial potential remains high, with 83% of respondents believing that AI will contribute to future revenue growth. The majority of companies (93%) rate their understanding of AI risks as “fairly good” or “very good”.
Despite the large-scale adoption of AI, the study found a number of challenges. More than half of respondents report skills shortages and difficulties recruiting. In addition, 46% of companies have appointed an AI ethics officer to ensure a balance between technology and ethics.
Almost two-thirds of organizations (63%) are actively measuring ROI, but expect a tangible financial impact to be visible after an average of 28 months.
AI errors, misinformation and so-called “system hallucinations” remain a serious concern. These factors topped the list of the main threats associated with the implementation of AI, according to 57% of respondents.
This was followed by legal and reputational risks due to the misuse of AI (56%), as well as data protection and privacy breaches (55%).
The survey also highlighted the importance of maintaining the human element in the use of AI, particularly in terms of personal responsibility, corporate governance and staff training.
While some companies will still need time to fully embrace AI, many are making incremental progress. Customer experience should remain a key priority.
The findings align with what the company is seeing among its customers. Over the past few years, the company has invested in data, analytics and digital skills to ensure teams are ready to deliver the best outcomes and solutions for customers in a rapidly changing marketplace.