AI isn’t just transforming industries – it’s reshaping risk. As AI evolves at speed, insurers are confronting new challenges, from data sovereignty and privacy to security, sustainability, and governance.
We cut through the complexity to explore how AI is redefining insurance. From shifting regulatory frameworks to the rise of large-scale AI infrastructure projects like Stargate and DeepSeek’s advanced reasoning models, the landscape is changing fast.
The challenge? Balancing innovation with security, transparency, and ethical accountability.
For insurers, the stakes are high. Adapting to evolving regulations, mitigating ESG-related risks, and reinforcing governance structures will be critical to maintaining trust in an AI-driven world.
At Wotton Kearney, we’re not just watching these shifts – we’re leading them. Through WK labs, we’re driving AI-powered solutions in digital enablement, eDiscovery, cyber forensics and more.
The future of AI in insurance is unfolding now. If these challenges are on your radar, let’s talk.
Charles Simon Managing Partner, Casualty and Operations Head of WK labs T +61 2 8273 9911 E charles.simon@wottonkearney.com
3 standout insights on AI and insurance:
DeepSeek and LLMs: Sovereignty, privacy and security
DeepSeek’s humanlike reasoning brings opacity, raising concerns about data use, privacy, and compliance – especially under non-Western AI standards.
For insurers, this poses regulatory and trust risks. Strong governance, explainability, and data protection are essential to balance AI innovation with rising privacy laws and data sovereignty demands.
Investing in infrastructure: Stargate, ethics and greenwashing
Massive AI investments like Stargate signal rising demand but raise sustainability and greenwashing concerns.
Backed by tech giants, Stargate’s scale brings environmental and ethical scrutiny.
Insurers must assess ESG claims, manage cyber and infrastructure risks, and enforce transparent ESG policies to maintain credibility and reduce potential liabilities.
Scaling AI without sacrificing risk mitigation and security
As AI adoption grows, insurers must ensure organisations meet strict security and regulatory standards. Data protection, cybersecurity, and continuous monitoring are essential.
Offering coverage for AI-related risks will be critical, with strong governance and documentation helping businesses scale AI safely while managing compliance, privacy, and operational threats.
“As part of our survey, 67% of respondents from bestin-class insurers said their organisations were ready to leverage and maximise Gen AI capabilities”
World Life Insurance Report 2025, Capgemini Research Institute
Redefining how legal services are delivered in the insurance sector
As we enter a new era of digital innovation, Wotton Kearney is focused on transforming how we operate – making our services more efficient, secure, and client-focused.
In 2024, we became the first Australian law firm to adopt Cicero, a fully private generative AI tool built specifically for the Australian legal industry.
This technology is helping our lawyers deliver:
Faster results: Critical information can be identified more quickly and accurately, particularly on time-sensitive matters.
Reliable outputs: Low complexity use cases are carefully designed to minimise the risk of errors or hallucinations.
Reduced risks: Our approach ensures data privacy and security, supported by dedicated infrastructure with no third-party data sharing.
Importantly, this tool is designed to enhance the way we work – supporting smarter, more efficient outcomes, while still relying on the deep legal expertise and judgment our clients trust. Click here to learn more about our innovation initiatives through WK labs.
Wotton Kearney acknowledges the traditional custodians of the lands on which we work, and pay our respects to Elders past and present.
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