Friday Edition

Global embedded insurance hit $189 billion this year. Up from $145B in 2025. Growing 30%+ annually. When you tick that protection box at an online checkout, you are buying insurance from a company you cannot name. That is not a bug. That is the business model. Customer acquisition drops from GBP 200 to GBP 50. [Mordor Intelligence, Precedence Research]

Paper says ~$105. Physical delivery is still running ~$140. The $37-40 backwardation premium has not budged since the Strait of Hormuz closed on 28 February. Insurers buy physical, not paper. If your reserve calculations use paper Brent, your reserves are wrong. [EIA, Reuters, CME Group]

Average claim now GBP 3,699. Paint and materials up 16%. ADAS (those fancy sensors in your bumper) triples the cost of a windscreen replacement. EV repairs 25% more expensive than ICE. And the EY motor net combined ratio forecast sits at 111% - loss-making territory. Premiums fell 13% while claims rose 23.8%. The maths does not work. [Thatcham, EY, ABI]

Q1 2026 saw the fewest InsurTech deals since 2016 - just 81. But total funding hit $1.6 billion. Average deal: $22.5 million (was $13.6m a year ago). Median deal size doubled the 2021 boom peak. Then April fell 50% month-on-month. Volatility is the new normal. Oh, and 95% of the money went to AI-focused companies. [CB Insights, InsurTech Analyst]

EU AI Act high-risk rules apply to insurance pricing AI from 2 August 2026. If your pricing model cannot explain why it charged someone more, you have nine weeks to fix that. The FCA is watching closely even though it is technically an EU regulation - "supervisory convergence" is the polite term for "we will follow suit." [EU Official Journal, FCA, Clifford Chance]

FCA updated focus areas on 7 May: data-evidenced fair value. Not "we think it is fair" but "here is the data that proves it." If your customer data lives in five disconnected systems, assembling that evidence costs a fortune. If it lives in one, it is a query. Claims handling is the FCA's primary supervisory lever for 2026. [FCA, Browne Jacobson]

Industry-wide detected fraud running at ~GBP 1.16 billion. AI-manipulated images are now a major claims vector - deepfake damage photos. Synthetic identity repeat offending up 40%. Spoof insurance app arrests continuing. If you cannot see across your entire book, you cannot see the pattern forming in front of you. [ABI, Insurance Fraud Bureau]

86,120 new EVs registered in March - a record. The premium gap between EV and ICE insurance is under 10%. But the repair cost gap is 25%. Someone is eating that difference and it is not the customer. Yet. [SMMT, Thatcham]

GBP 6.1 billion in property claim payouts. Flood claims up 38%. Average flood claim now GBP 30,000 - up 60%. CPI at 2.8% means claims inflation is outrunning general inflation by a factor of ten in some lines. [ABI, ONS, Insurance DataLab]

Major high street retailers are launching insurance panels instead of in-house products. Electronics retailers sell "care plans" that are not regulated insurance alongside mobile cover that is. Same counter, different regulatory regime. The line between retail and insurance is dissolving. Consumer Duty headache incoming. [FCA, industry filings]