In 2025, property and casualty insurers are modestly increasing IT spending to 4.5% of premiums, with midsize firms driving the growth. Large insurers are prioritizing cost reduction, workflow optimization, and insuretech innovation over prior focuses like analytics and speed to market. AI investment is rising, especially in large language models and unstructured text processing. Most insurers are continuing core system replacements rather than starting new projects. Challenges persist around talent acquisition and project execution, which may limit IT departments' ability to fully deliver on strategic plans.

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