2022 KPMG Inflation Survey: Insurance Report

Inflation prompts a multifaceted response from insurers

With inflation as high as it has been in decades, United States-based insurers said in a KPMG poll they have launched a multiple-front strategy aimed at managing the impact of rising costs in this volatile operating environment.  Interestingly, while almost all insurance respondents made it clear that they are focused on cost management, they also said they plan to increase their investment in technology to improve operations and meet customers’ demands.


Placeholder Infographic goes here



Survey highlights

  • 62% cite unforeseen geopolitical risks as a top organizational challenge in MANAGING impacts of inflation
  • 82% expect to raise prices by the rate of inflation (52%) or more (30%)
  • 72% envision passing on price increases in three to six months
  • 74% are looking at right-sizing staff as a means of offsetting the impact of inflation
  • Nearly 40% plan to allow all employees to work remotely to reduce real estate and related spending
  • 65% anticipate increasing their technology spend by 5% to 20% to mitigate inflationary impacts

Accelerating top-line growth
Despite falling consumer sentiment, 82% of companies expect to raise prices by at least the rate of inflation. At the same time, nearly 60% may look to develop new products at lower price points in an effort to maintain or increase customer wallet share.

Protecting the bottom line
In the face of wage inflation, companies are re-evaluating the right size, structure and location of their workforce. They are considering workforce reductions (48%), cuts in non-salary compensation (47%) and relocating staff to lower-cost regions (53%), while also exploring refinancing (54%).

Planning for exogenous factors
With unforeseen geopolitical risks leading the list of organizational challenges, companies are realizing that “dark swans” are lurking everywhere. They are factoring geopolitics into their risk planning, on-shoring or near-shoring more functions, and building resilience into their supply chain and foreign exchange processes.

Responding with technology
With headcount reductions and right-sizing programs looming, companies expect to counter the potential hit to productivity with technology. Among respondents, 65% expect to increase tech spending by 5% to 20%, with AI, machine learning, blockchain and cloud computing increasingly seen as inflation-fighting investments.

Version 2

Key Survey Findings


Technology spending

Although many IM companies need to modernize their technology infrastructure, 71 percent expect either no change in tech spending or an increase of less than 5 percent. Insurance executives have acknowledged in conversations with our professionals that ensuring they have the technology resources in place to support operational transformation projects is critical for them in order to be ready to compete when the economy improves, and inflation is under control.


Rising wages

Wage data is interesting when viewed against a backdrop of the U.S. unemployment rate sitting at 3.7 percent as of August 2022—around the lowest level in decades—and the addition to the U.S. economy of 315,000 jobs, following a jump of more than 530,000 in July. These numbers are expected to prompt the Federal Reserve Board to extend its recent series of rate increases.


Office space

An eye-opening survey result was that nearly all insurance respondents, or 90 percent, said they would allow full-time remote work. By contrast, 39 percent of all respondents said they would permit employees to work remotely full-time. Ninety percent of bank respondents also said they would allow employees to work remotely.


Geo Political Risk

In the current environment, insurers are baking geopolitics more heavily into their risk and inflation scenario planning. These risks have significant implications relating to exchange-rate fluctuations and operational planning as a result of global supply-chain disruption.


Read the full 2022 KPMG Inflation Survey

From bottom line to top line, inflation is top of mind across all industries. The 2022 KPMG Inflation Survey captures a long-term view of how inflation is impacting strategic decisions and corporate behavior.


Structural Change Watchlist

Structural shifts are more profound than cyclical shifts, as they upend existing business models. Knowing the trends already underway is a powerful advantage when hedging risk. We look at the top 10 structural changes reshaping the economic landscape today.

Our Team

Meet our trusted partners who can answer questions regarding inflation and help you plan for unpredictable factors.  

Ed Chanda

Ed Chanda

Partner, National Sector Lead, Insurance, KPMG US

Ian Sterling

Ian Sterling

Principal, Advisory, Actuarial, KPMG US

+1 856-912-7242