The Insurance Halftime Report – 2026 Trends

The CNBC Halftime Report is the place for market-moving interviews and fast-paced market analysis. It places investors right at the heart of the action, helping them navigate the rest of the day’s trading. 

As we enter the second half of the year, we wanted to take a look at what we see as key trends in insurance technology and operations and how they relate to the trends we outlined in our report, 2026 Trends Vital to Compete and Accelerate Growth in a New Era of Insurance. Where are we as an industry? Are there mid-stream course corrections that insurers should consider to navigate wisely?

Right now, the insurance industry is being redefined. We are entering a new era of insurance – one challenged with economic volatility, increased risks, rapid emergence and adoption of new technology and AI, a growing protection gap, and rising customer expectations. These challenges are redefining insurance value, convenience, and trust.  Insurers must embrace a new era of insurance intelligence that redefines their operating model and technology foundation.  While insurers are very aware of these challenges, many lack a strategy and execution of initiatives that will reshape their operational model and technology foundation to break out of the business-as-usual mindset.

We are entering an era where the foundational logic of the insurance industry is being rewritten. The traditional operating model, a testament to stability and structured process, is no longer sufficient to navigate the accelerating complexities of risk in a digital-first world. The challenge—and the immense opportunity—is not merely to automate legacy processes but to infuse them with intelligence, transforming the very core of how value is created and delivered. It is about a new target operating model. This is where the concept of the Frontier Firm emerges.

Trend:  Frontier Firm – Frontier Insurer

A Frontier Firm represents a new paradigm of organization emerging in the age of AI. Frontier Firms are defined by Microsoft as companies “powered by intelligence on tap, run by human-agent teams, and defined by a new role for every employee: the agent boss.” The Frontier Firm redesigns fundamental business processes around AI to achieve unprecedented agility and value creation faster than traditional companies. They invest in trustworthy data and AI foundations, forge strategic partnerships, foster an agile learning culture, integrate AI deeply into operations, and secure unwavering sponsorship from leaders in the organization.[i]

This new paradigm incorporates three complementary trends we outlined at the beginning of the year — those that empower emerging Frontier Insurers. These trends include:

• Unlocking Growth Strategies with a High-Performance Operating Business Model for a New Era of Insurance
• Using AI Strategy + Intelligent Tech to Power Real Business Value and Optimization
• Accepting Human-Centric AI as an Intrinsic, Rising Part of the AI Revolution 

The Frontier Insurer operating model reimagines the organization and workflows, not as a collection of siloed functions, but as a dynamic, interconnected system powered by agentic AI. It moves beyond simple automation to embrace autonomy, structuring work around three core concepts: intelligence on tap, human-agent hybrid teams, and agent bosses – human-led, reflected in these three phases:

• Phase 1: Human with AI Assistance – AI tools assist humans with specific tasks (e.g. using a Copilot to draft content or analyze data). Productivity improves, but AI remains a tool at humans’ fingertips as intelligence on tap.
• Phase 2: Human–Agent Hybrid Teams – AI agents join teams as digital co-workers collaborating and handling discrete tasks under human guidance. Employees begin to delegate work to agents and focus on higher-value oversight.  For instance, a customer support agent delegates routine inquiries to an AI agent but steps in for complex exceptions.  AI augments human expertise.
• Phase 3: Agent Boss – Human-Led – A human leader sets the strategic direction and manages a team of AI agents by exception, intervening only for complex escalations or strategic pivots.

While there is a lot of focus on AI, we are already seeing forward-thinking insurers that are fully embracing the power of AI and are well into all three phases of the journey. These include insurers of all sizes across a diversity of business types within P&C and L&AH.  The new operating model and technology foundation is being built today by leaders who understand that the future of insurance is not just about managing risk, but about anticipating and preventing it with unprecedented precision. Their efforts will close the protection gap, the talent gap and the experience gap demanded and needed by customers.

Halftime Report: These trends are just beginning to gain priority. Insurers that grasp the full implications and course correct will place themselves in a solid leader position that will challenge their peers across the business. In some cases, it will require insurers to ignore hype, finding and focusing on the phenomenal work that is quietly taking place — not swayed by every new press release, tech whim or speculative quote from pundits.

Trend: Legacy Debt and InsurTech Zombie Challenges

There is a hidden disease that is killing insurers — the disease of legacy debt.  The solution is to focus on another Majesco 2026 trend: The Future of Insurance Tech is Now – A Cloud-Native and AI-Native Core Technology Foundation. The Frontier Firm – Frontier Insurer is highly dependent on this shift away from legacy. 

Investment’s most important criteria

An investment — any investment — is an expenditure of money, time or energy with the anticipation of a positive result or profit. It ceases to be a true investment when its results have turned the corner and have become a “necessary” burden or liability. Today, we have nearly 70–80% of carriers still running core on legacy, much of it on‑premise, highly customized, and unable to run modern AI natively. The problem is a matter of strategic priority, investment and focus. Insurers are still pouring funds down obsolete tech tunnels through amortization, ongoing maintenance, and payoffs — and they are doing it only to maintain the way they have done business in the past. It does nothing to support doing business for the future, including bringing new products to market. It leans toward liability. Business transformation in insurance must include the move to an AI-enabled core to create the business operating model needed for the future.

The reasons legacy debt still dominates are varied and complex, but a few key universals seem to predominate.

• Inertia — A system that is still working is tough to replace, especially if there are other priorities.
• Sunk cost — The capital expenditures paid and now being amortized over 10 years are stopping or slowing change, often due to the financial impact. Some may have to raise money to fund both the write-off and the new initiative — a financially dangerous move.
• Patchwork modernization — The typical approach of “bolting on” new capabilities or solutions rather than replacing created “spaghetti legacy.”  That approach does not work today because bolting on AI rather than embedding it in the workflow to operate seamlessly across functions is fraught with potential regulatory issues, including lack of transparency and auditability now required.

Compounding this is vendor fragility reflected in another trend – Zombie InsurTech Companies Endanger the Future of Insurance.  This vendor fragility is seen in a growing number of private‑equity‑backed, VC-backed, legacy InsurTechs, and under-capitalized InsurTechs that can no longer invest at the level of pace needed to stay relevant in this new intelligent era of insurance.  We are now seeing InsurTechs selling at significantly lower valuations due to lack of profitability, having to borrow money for investment at much higher rates due to lack of or low profitability and growth, and even InsurTechs that are now only selling their assets, often at a fire sale. 

The strategic mandate must be to reassess every technology dependency through a financial, operational and strategic resilience lens, because every vendor that ceases operations or is unable to invest in the technology compromises your ability to serve your customers and puts your long-term viability and relevance at risk. 

Halftime Report: Legacy has been and will always be around, but we must plan for a realistic view of how long these systems will last — more like 7-10 years rather than 10-20 years or more given the pace of change. Without a strategic plan for reinvestment, the business will run, but far less effectively, slowly deteriorating the business. In addition, ensure your strategic technology partners have the financial fortitude to invest in business and technology, keeping it relevant, making it easy to upgrade, and at the edge of all new technology. The right partner matters more than ever.

Trend: Market Growth Opportunities

Even with the significant trends noted that are fundamentally changing the business, there are likewise significant market opportunities for growth – opportunities that could be the greenfield for a new operating model and technology foundation. These market opportunities address key growing gaps: the protection gap and customer experience gap.  They are represented in the three trends: The Silver Economy: Age of Senior Market Opportunity, Innovation Accelerates Specialty Market Growth, and Predict and Prevent Creates Real Customer Value. 

Interestingly, insurance companies and insurance customers are impacted by the same pressures, but are reacting to them differently, creating an alignment gap that creates market opportunity.  For insurers, the dominant themes are operational cost, profitability, legacy technology, modernization, AI, and the need to create a more intelligent operating model.  For customers, the dominant themes are affordability, financial vulnerability, preparedness, protection gaps, trust, and whether insurance actually feels relevant to the risks they face in everyday life.

While the two perspectives are different, they are not totally disconnected. In fact, they are often looking at the same problem from opposite perspectives. Majesco uncovered this in their primary research with insurers and customers when they assessed the similarities, differences and patterns between them. 

For example, we found that there is a meaningful pattern of alignment around cost pressure, financial strain, product relevance, personalization, digital engagement, AI, and the need for a more proactive and protective insurance model and products.

Customers frame it from an outside perspective—through lived experience. They want solutions that improve confidence, preparedness, affordability, and trust.  The result is a strategic alignment challenge, but also a powerful opportunity.

To capture the opportunities, insurance leaders choose to rethink their offerings to be more relevant for their lifestyle, demographics, risk and financial needs. These leaders will modernize their business operating model and technology foundation with AI and Cloud-native platforms and translate that modernization into customer value.

Halftime Report: The insurance industry is entering a period in which strategy and customer reality can no longer evolve on separate tracks.  For customers, success will be defined by insurers helping them be more prepared, protected, and confident in a world of rising uncertainty, financial strain and cost. For insurers, success in the next era will require modernization of the operational model and technology foundation with stronger strategic execution. Successful insurance leaders will address both together, rather than as separate mandates because they see clearly how they are essentially the same mandate, seen from different sides.

Are you ready for the second half of 2026?

Majesco invests in a technology foundation and operating model to shape and accelerate an insurer’s future, allowing them to innovate with confidence as a Frontier Insurer using our intelligent core solutions. Learn more about becoming a Frontier Insurer with a clear path from their legacy systems toward cloud and AI-native solutions. Be sure to read Majesco’s recent Thought Leadership report, Strategic Priorities 2026: The Frontier Insurer in the Intelligent Era of Insurance, and sign up for our upcoming webinar, From Intelligence to Action: How GenAI and Agentic AI are Reinventing Insurance as a Frontier Insurer.

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[i] “Work Trend Index Annual Report 2025: The year the Frontier Firm is born,” Microsoft, April 23, 2025, https://www.microsoft.com/en-us/worklab/work-trend-index/2025-the-year-the-frontier-firm-is-born