Majesco, a global provider of cloud and AI-native insurance software for Property & Casualty (P&C) and Life, Annuity, & Health (L&AH) insurers, has released its latest annual research, “Strategic Priorities 2026: A New Era of Innovation and Disruption Offers Real Business Value.” The report highlights the urgent need for fundamental changes in insurers’ operating models and technology foundations to drive profitable growth, efficiency, competitive differentiation, and address talent challenges.
The research indicates that insurers are currently operating on 20th-century business models and technology, underscoring the necessity for immediate change to embrace a more intelligent era of insurance. Business operating models require flexibility, scalability, and advanced technology capabilities available today.
A central focus for businesses highlighted in the report is operational costs, profitability, expense ratios, and growth. These issues are clustered at the top of insurers’ agendas, indicating a broad, sector-wide consensus on the significance of efficiency, financial performance, and cost structures.
From a technology perspective, the report emphasizes advanced data and analytics, keeping pace with core system advancements, navigating legacy system limitations, and the integration of AI, including Generative AI (GenAI) and Agentic AI. Modernization is no longer viewed as a strategic luxury but as a necessary enabler of financial outcomes, with the cost and impact of legacy debt noted as a significant drag on organizations.
Talent challenges are also a critical concern, stemming from increasing retirements, loss of institutional knowledge, difficulty in leveraging data for insights, decreased operational productivity due to manual workarounds, slow speed to market for new products, and an inability to utilize new technologies like GenAI. These factors collectively drive the need for operational optimization and legacy system replacement to mitigate operational risk.
Reflecting the growing array of challenges, the report notes a significant decrease in future optimism compared to prior eras. However, it identifies a segment of “Leaders” who are accelerating across strategic dimensions such as innovation, business model change, product evolution, channel expansion, and core system modernization. These leaders are actively rethinking their business and technology foundations, in contrast to “Followers” who proceed selectively and modestly, and “Laggards” who show entrenched stagnation.
Denise Garth, Chief Strategy Officer at Majesco, stated, “The message is clear from the research: growth is not occurring randomly. Growth is directly tied to a strategic plan, investment, and execution of structural modernization with a focus on the business model and technology foundation that enable insurers to innovate, bring new products to market and expand channels for market reach.” She added that those proactively focusing on six key strategic initiatives see up to a 1.67X uplift in growth, a persistent, widening, and compounding advantage over time.
Over six years of tracking, the research consistently demonstrates that insurers who invested more in these strategic activities achieved higher growth multiples than their lower-activity counterparts. The report concludes that companies that act boldly outperform those that move cautiously, emphasizing the urgent need for insurers to embrace change to reinvent their business operating models and technology foundations to adapt to industry challenges.
