AI May Be Tempering Insurer Hiring

The share of insurance companies planning to maintain their current staff size over the next 12 months has reached a 15-year high—while just 7% of insurers plan to reduce headcount in 2026.

Aon and The Jacobson Group’s Q1 2026 Insurance Labor Market Study found that 43% of industry respondents expect to hold staffing steady. That figure is up 10 percentage points from January 2025.

Jeff Rieder, head of benchmarking for Aon’s strategy and technology group, shared those findings during a Feb. 19 webinar. He pointed to several possible factors behind the trend, including a historically profitable 2025, strong investment performance and companies fully experiencing productivity gains from recent technology system investments.

“And the last thing that may be also driving this is with the advancements in artificial intelligence, what this could indicate is that companies are, we’ll say somewhat pausing on hiring plans to see just how artificial intelligence will be adopted within the organization,” Rieder said, “and how this is going to improve certain functions.”

Job openings in insurance and finance have declined significantly since peaking in 2022. According to the U.S. Bureau of Labor Statistics, the annual average number of openings in 2025 was 281,000, while December’s total fell to 138,000.

That marked the lowest monthly level in the past decade.

“I really do think that this might be kind of the indication of how AI is starting to influence a lot of these activities in terms of how companies are thinking about hiring,” Rieder said when presenting the numbers.

Aon and The Jacobson Group’s study also found that 49% of property/casualty companies plan to increase staff over the next year. The survey covered approximately 10% of the insurance industry’s employee population. Participants were primarily from the property/casualty sector (77%), followed by life and health insurers (19%) and reinsurers (3%)

Automation improvements requiring fewer staff were the most common reason cited by companies reducing headcount. Involuntary turnover across the broader insurance industry rose 0.6 percentage points year over year, which Jeff Blair, senior vice president of executive search and business development at The Jacobson Group, attributed in part to technology advancements and M&A activity.

Based on recent years’ data, Rieder estimated that roughly half of the 4.4% involuntary turnover rate could be attributed to performance management, with the other half possibly reflecting organizational right-sizing.

At the same time, 12-month voluntary turnover declined 0.4 percentage points from January 2025. Based on his conversations with insurers—particularly property/casualty carriers—Blair said companies are focusing on retention programs and keeping employees.

“I hear a mantra of ‘I’d rather pay a stay bonus than a sign-on bonus,’” Blair said. “I don’t know to what extent that’s having an impact, but I think those sort of behaviors can definitely have a positive impact [on retention].”

Rieder added that the rise of better insurance industry incentive programs in the past decade or so has improved voluntary turnover, as have enhanced benefits programs. Promotional increases are likely to range from 3.8% to 4%, Rieder added, while merit increases are projected to be between roughly 3.3% and 3.5%.

These trends show that the “pendulum is definitely going back in favor of the insurance employer, for now,” Rieder said. That shift may portend well for turnover, “but could be more difficult as new entrants into the industry try to get in with lower hiring expectations.”

Other Notable Survey Findings

• Only 2% of respondents to Aon and The Jacobson Group’s survey expect revenue to decrease in the next 12 months, while 72% foresee increased revenue and 26% anticipate flat growth.
• The P/C industry headcount grew by 0.81% from January 2025 to January 2026. That was “significantly less” than the anticipated rate of 1.42%, Blair said.
• Personal lines P/C companies are the most optimistic about revenue growth, with 90% expecting increases, compared with 68% of commercial lines carriers and 64% of balanced lines companies.
• Technology, claims and underwriting roles are expected to see the greatest job growth across the insurance industry over the next year.
• Compliance, analytics and underwriting are the areas where companies are most likely to add experienced staff, while operations and claims roles are most likely to add entry-level positions.

Topics
InsurTech
Carriers
Data Driven
Artificial Intelligence
Talent