Speaking with Lawyers Weekly, three senior lawyers discussed the key factors and areas they anticipate will influence the insurance practice space this year, as well as the challenges and opportunities facing practitioners in this sector.

Navigating regulatory complexity

Jehan Mata, partner at Sparke Helmore Lawyers, noted recent regulatory changes will require insurance lawyers to remain highly vigilant as they guide clients through an increasingly complex compliance environment.

“Both the APRA Risk Management Regime and new sustainability reporting requirements will impact insurers in 2026, and lawyers should be vigilant to ensure their clients comply where necessary,” she said.

Additionally, with cyber attacks on the rise and multiple data breach class actions underway, Mata pointed out that the Australian Securities and Investments Commission (ASIC) is starting to “increase focus on cyber resilience” and advised lawyers to closely monitor this evolving and changing landscape.

VIEW ALL

Mata specifically advised insurance lawyers to keep abreast of changes to the Cyber Security Act 2024 and amendments to the Privacy Act 1988, which include introducing “a statutory tort for serious privacy invasions”, as implications continue to evolve throughout FY25–26.

As reported by Lawyers Weekly last year, the Cyber Security Act marked Australia’s first standalone legislation of its kind, introducing mandatory reporting for those who pay threat actors ransom, minimum cyber security standards for smart devices, and the establishment of a Cyber Incident Review Board.

While she advised insurance lawyers to assist their clients to “ensure their own compliance”, Mata also noted that the changes present “opportunities for enhanced product offerings” for insurers.

“Risk managers should partner with brokers to help quantify cyber risks, understand claims activity, and stay ahead of evolving threats,” she said.

A moderating market with new pressures

Although the insurance market in recent years has been characterised as a “hard market” from an insurer’s perspective, Patrick Mead, partner at Carter Newell Lawyers, observed signs that this trend is beginning to slow.

As a result, Mead suggested that “the balance, in some areas, will start to swing back to insureds [and] brokers”.

“Illustrative of this are new broker wordings being issued in the market in the first party space for the ’26 financial year. This is particularly evident in project contract works,” he said.

“If insurers wish to underwrite certain projects, the suggestion is that they are now being asked to subscribe to the broker’s manuscript wording, with potentially less ability to negotiate terms.”

Echoing this, Alex Haslam, principal at Gilchrist Connell, anticipated the commercial insurance sector would remain in a “soft phase” throughout FY25–26, with premiums continuing to decline or grow slowly amid strong industry performance.

“The commercial insurance market is in a soft phase, with premiums declining or growing slowly, driven by profitable industry performance. Major accounts are more volatile than SME business, with some lines, like D&O, falling faster than expected. This trend may persist, exacerbated by new market entrants,” he said.

Despite this softening, Mead pointed out that insured individuals will continue to face pricing pressures in the upcoming financial year, a challenge that their lawyers will also need to be mindful of.

“The impact on reinsurers as a result of the US fires earlier this year has the potential to impact insurers’ reinsurance treaties worldwide, and lead to either higher premiums or greater self-insured retention,” he said.

“Further, as a result of two decisions in the past 18 months in the US, which considered the operation of a commonly deployed London Market Defect Exclusion LEG 3, (and which found in favour of insureds), anecdotally, we have heard that some insurers have going forward withdrawn cover of this nature globally.”

To navigate these challenges in FY25–26, Mead emphasised that insurers will need to have a “greater focus on technical underwriting and risk engineering”.

“There also appears to be a strong move back into the Australian market by Lloyd’s and London Underwriters, which presents opportunities for [insurers] (especially those who have established a physical Australian presence), and potential challenges to locally based insurers, competing for market share,” he said.

Lawyers Weekly will host the Partner Summit on Thursday, 12 June 2025, at The Star, Sydney, at which speakers will address the range of opportunities and challenges for partners and partner equivalents, provide tips on how they can better approach their practice and team management, and propel their businesses towards success. Click here to book your tickets – don’t miss out! For more information, including agenda and speakers, click here.