- Why ‘disruption’ is the buzz word for 2026
- The industries next on the list for disruption by technology
- Car insurance companies might have to change their business model
- Travel portals face major competition from AI
- Is Rightmove’s AI spending an offensive or defensive move?
- Why shares in RELX, Sage and Experian plunged this week
Dan Coatsworth, head of markets at AJ Bell, comments:
“Disruption could turn out to be the buzz word of the year. Anthropic’s new AI tools caused upset to various stocks this week amid fears they could displace many existing services offered by established companies.
“There is potential for disruption on a much bigger scale from AI and other tech innovations, with industries like insurance and retail looking vulnerable. In short, there could be more bumps in the road ahead.
“Here are four areas to watch, and an explainer on why certain sectors experienced share price shocks this week.”
Four industries to watch
- Motor insurance
“Admiral saw £1.3 billion wiped off the value of its share price between 21 January and 26 January 2026 after US insurer Lemonade launched cover for autonomous vehicles.
“Normally a new insurance product wouldn’t move the dial, yet Lemonade’s policy is half the estimated cost of what you’d pay on a car controlled by a real person.
“Lemonade uses AI to help with claims processing, underwriting, customer service and fraud decisions, making it a lower cost operator in the sector. However, its autonomous vehicle policy isn’t simply Lemonade engaging in a price war – it’s a radical shift in the insurance sector and potentially bad news for companies like Admiral.
“Lemonade’s new policy is specifically for Tesla self-driving vehicles and is based on the principle that autonomous vehicles are safer and involved in fewer accidents. Therefore, Lemonade believes they are cheaper to insure. This echoes what’s happening in China, with suggestions that autonomous vehicle insurance policies could be as much as a quarter of the price of traditional motor cover.
“It also begs the question as to whether the car manufacturer and vehicle software provider are liable in the event of an accident involving a fully self-driving car, not the person in the front seat. After all, the human wouldn’t be controlling the vehicle.
“If so, would that mean car insurers like Admiral who mainly serve the public would lose business to bigger commercial car insurers? That certainly poses a new challenge to the sector, and like always when new information is presented, investors react first and think later – hence the slump in Admiral’s share price.
“The stock market is forward looking and investors price in what they think will happen in the future. However, it’s hard not to ignore the fact that fully self-driving cars aren’t allowed on roads in the UK yet. The government is keen for that to happen at some point, but it feels like investor panic around the likes of Admiral might be a tad premature.”
- Consumer portals: travel
“Websites like Expedia make travellers’ lives a lot easier when it comes to booking a trip. You can browse options and book online from the comfort of your living room. Easy-peasy and very convenient, but travel and accommodation are only one part of the holiday experience.
“You can now submit a few simple bits of information to an AI engine like ChatGPT, and a full itinerary is produced in a matter of seconds. That’s next-level planning when it comes to getting the most from a holiday. For example, someone planning a road trip across Western Canada can get a full breakdown of stuff to do, where to go, and how to get there.
“We’re now starting to see the next phase of AI agents as they move towards complete transactional capabilities – namely finding the cheapest prices and making the relevant bookings, which is far more sophisticated than navigating ‘old school’ travel portals.
“Google’s AI systems had a major upgrade last November to broaden travel-related capabilities. Its AI Canvas tool can be used to build travel plans, while its Flight Deal AI-powered search tool is a way to find flights and save money. You can also tell it about restaurant, event and beauty treatment preferences, and it will provide a curated lists and direct links to book through partners. Google says in the future it will be possible to book flights and hotels directly in AI mode.
“If there is no commission to pay the middleman such as with Expedia, there’s a good chance prices could be cheaper for the traveller. It’s still early days for AI agents, but the technology is developing at a rapid pace. This has put pressure on the likes of Expedia and Booking Holdings to up their game and offer more services to compete against AI agents.”
- Consumer portals: other (property, cars, classifieds)
“Shares in Rightmove, Autotrader and Baltic Classifieds have been weak in recent months as investors question if AI could be a help or hindrance.
“Portals like Rightmove and Autotrader thrive from the network effect, namely the more people use a website, the more useful it is. In Rightmove’s case, greater user numbers mean estate agents are more likely to want to pay for prominent positioning to market their properties. For Autotrader, the same applies for car dealers.
“More sophisticated search facilities on generative AI platforms mean users now have a different way to find houses or cars, and potentially as part of a more convenient process. This means portals must up their game and spend more money to make their sites essential places to visit.
“It’s no coincidence that Rightmove’s shares have been in steady decline since announcing last November it would make AI-related investments. A year earlier, any mention of AI would have been cause for celebration. Now it’s a suggestion that Rightmove is having to move with the times, and investors are jittery about companies spending on tech.
“The question people might now ask is whether Rightmove’s AI spending plans are an offensive or defensive move.”
- Retail
“AI has the potential to transform the fashion retail sector, and the shopping chains who don’t embrace technology stand to be left behind.
“Historically, people would go to a shop, try on items, and buy the ones they liked and/or fitted well. The advent of the internet meant people ordered ‘blind’ online, based on their average size. Frustratingly, dimensions fluctuate between different sellers, meaning a medium size might fit you in one shop, but not from another. That’s led to a proliferation of online returns which is one of the big cost pressures for retailers.
“AI has the potential to greatly reduce returns based on sizing by mapping the precise measurements of clothing onto a digital image of the shopper. Virtual try-on tools have existed for many years and while their usage has been limited, reports suggest they lead to greater sales conversions for those who try them. Technological advancements could bring them into the mainstream.
“Google is rolling out a tool that generates a full body digital version of an individual which then lets the person virtually try on clothes from billions of product listings on its Shopping channel.
“The scope for AI to help drive sales and cut costs in retail is immense. It’s not only about embracing technology to help customers with look and feel, but also about using AI to offer virtual stylists, more powerful product recommendations, and even pre-filling shopping baskets with suggested items.
“Retailers need to be in on the game, otherwise AI could put them in the bin if they don’t embrace technology.”
Why has AI disruption been all over the news this week?
“Data, advertising and software-related companies have seen a big hit to their market valuation this week. Investors suddenly feared names like RELX and Experian could see a big hit to earnings if clients switch to third party AI tools.
“RELX’s share price fell by 14% in a single day after investors cottoned on to Anthropic’s Claude product update that included open-source plugins capable of automating a lot of legal work. RELX has prospered for decades as its services are embedded into legal professionals’ day to day work. There has long been an argument that clients couldn’t do their job properly without RELX’s services.
“The FTSE 100 stock has traditionally commanded a premium rating from investors, and any company in its situation stands to fall fast and hard on the stock market when worrying news comes out of nowhere. RELX traded on 29.6 times earnings in February 2025, and it has now de-rated to 15.4 times – its cheapest valuation in 12 years.
“Investors will hope that RELX offers words of reassurance when it publishes full-year results on 12 February, otherwise its share price could be tested once again.
“The market had already priced in pain for advertising agencies during 2025 as it became clear that clients could do more work themselves using AI technology, even to the extent of making video creatives. Anthropic’s latest tools create even more pain for advertising agencies as they can draft content, plan campaigns and manage marketing launches. It’s no wonder shares like WPP had a bad week on the market.
“Big questions have hung over ‘old school’ software players in areas such as accounting, for fears that AI could do a lot of their work. For example, Sage’s shares have been on a downward path for the past 12 months on fears its best days are over.
“There are reasons why AI might not simply upturn all these industries in one fell swoop. A lack of trust in the accuracy of AI-sourced information is one reason. RELX and Sage, among others, already have customers’ trust and they’re deploying AI in their own businesses to make their lives, and clients’, easier. This suggests clients might prefer to use their AI systems rather than a more generic company like Anthropic.
“Another reason why third-party AI may not instantly destroy companies is the fact names like RELX have proprietary information that won’t suddenly be fed into AI models for anyone to view.”
