2026 will be a defining year for financial services and executive search. After a year of analyzing the market and tracking trends across technology, talent and leadership, Hanover reveals the forces that will shape the year ahead, and what will separate the frontrunners from the firms still playing catch-up.

Financial Services Trends

“The financial services industry in 2026 will be defined by tech-driven change, fierce competition (for both customers and talent), and a strategic emphasis on resilience and adaptation.” – James Ridd, Americas CEO

1. Tech takes the helm

Across the financial services sector, technology modernization will be the driving force in 2026. With IT spend set to climb 6.5%-10.7% annually through 2028, according to PwC’s latest report, and with 99% of FS leaders feeling the vulnerability of their business models in the face of this disruption, firms are finally getting bolder with their digital reinvention: cloud infrastructure modernization, core system upgrades, and advanced analytics are all being fast-tracked.

AI adoption is the centerpiece. By 2026, leading FS firms will deploy AI for everything from underwriting and algorithmic trading to personalized customer service. Those who pivot to a tech-centric strategy will outpace competitors in efficiency and innovation.

2. GenAI and automation everywhere

GenAI is moving from experiment to infrastructure across FS, and is the top tech priority for 41% of firms, per PwC. We’re seeing AI agents being used to manage customer service, flag fraud and even surface trading insights in real time. The payoff isn’t just efficiency; it’s the birth of new digital business models, from fintech partnerships to “as-a-service” offerings, such as Banking-as-a-Service platforms. The sector’s leap into 2026 will be more automated, data-driven, and cloud-native than ever, though this must be accompanied by diligent cyber risk management as a necessity.

3. Big Tech redefines “good enough”

FS firms in 2026 will operate in an environment of heightened customer expectations and competition. Fintech and Big Tech entrants have reset the standard for speed, simplicity and personalization, leaving incumbents under pressure to deliver real-time, data-driven experiences.

If firms can create more integrated customer experiences and tailored products (think: super-apps, seamless omnichannel banking, AI-driven personalization) they will be in a much stronger position to compete head-on with the tech companies and fintechs encroaching on FS domains. Equally, embracing collaboration with Big Tech players can future-proof models and revenue streams, blending the scale and trust of traditional finance with the agility and innovation of tech.

4. Translating innovation into sustained revenue

In 2026, the challenge for financial firms won’t be just adopting new technology, but proving that innovation drives lasting commercial returns. According to KPMG, while 92% of financial services companies are generating profits from AI, only 32% are generating returns at scale. That disparity marks a clear shift in focus: from experimentation to execution, and from quick wins to durable growth. The firms that pull ahead will be those that spend strategically: investing in technologies that create real efficiency and insight, and empowering leaders who can convert that innovation into sustained revenue performance.

5. The scramble for specialized talent

As automation strips away routine work, it’s placing a premium on talent that can think, analyze and build with technology. The most successful firms will be those that upskill their people in AI, data and digital fluency, recognizing that adaptability is now the ultimate skill. But the real battle is external. Cybersecurity, AI and product innovation talent is already scarce. By 2026, demand will eclipse supply. The winners will cast their nets wider – into tech industries and unconventional talent pools – to bring in fresh capability and perspective.

Fintech Trends

“Fintech isn’t the challenger anymore, it’s the ecosystem. With AI reshaping financial products, regulators opening doors, and adoption soaring, we’re entering a phase where digital finance is the default.” – Alex Curtis, Americas Managing Director

6. Regulatory tailwinds for fintech

The US regulatory climate will be more fintech-friendly in 2026. Travis Hill, the FDIC’s new acting chairman, has signaled intentions to cut “unnecessary red tape” in order to spur bank-fintech partnerships, innovation and economic growth. It comes at the right time, as AI-powered finance and fintech adoption hit full throttle.

7. AI-powered finance goes mainstream

If financial institutions are modernizing, fintechs are productizing that change. GenAI and machine learning are doing far more than just underpinning operations; they’re defining the next generation of financial products, delivering on financial institutions’ top investment priority for 2026: AI. Already, we’re seeing GenAI embedded in personalized advice, conversational banking and automated risk monitoring. And every day, fintech apps are rolling out even smarter virtual assistants, AI-driven credit underwriting, and fraud detection at scale. Those betting big on AI are using these as their competitive differentiators, while regulators move fast to introduce smarter regulation that balances innovation with accountability.

8. Widespread fintech adoption

The use of fintech services will be nearly ubiquitous in 2026. As of early 2025, 78% of US internet consumers were using at least one fintech service on a monthly basis, indicating mainstream acceptance. Younger demographics drive this trend: 91% of Millennials use fintech for payments, lending or investing, and 68% of Gen Z in the US prefer fintech providers over traditional banks for core services. With trust in digital finance growing, 2026 is likely to see record user numbers, with fintech’s reach expanding into demographics like Gen X and Boomers as comfort with mobile banking and digital wallets increases.

Insurance Trends

“Insurance is at a genuine turning point. After years of cautious progress, the sector is finally embracing AI at scale. But talent is still a glaring problem.” – Cate Furman, Managing Director

9. Insurance steps into the AI era

Of all the FS sectors, insurance has always lagged behind when it comes to tech adoption. But it’s finally catching up. Nine in ten insurance executives now view AI as a force for progress, and by early 2026, four in five US insurers will have embedded GenAI into live operations – a rapid shift for such a cautious sector. The focus is moving beyond back-office automation to customer-facing innovation: AI chatbots handling claims, predictive models refining underwriting, and hyper-personalized outreach driving engagement. With data as its lifeblood, insurance may end up being the industry best placed to lead the AI era.

10. AI won’t deliver if the skills gap remains

For all the talk of transformation, capability remains a top risk factor in insurance as we head into 2026. Over half of insurance leaders (52%) admit their teams lack the AI skills to match their ambitions, and many actuaries remain on the sidelines of adoption. Over the next 12 months, the focus must be skill-building. Just as in-house “universities” were once used by firms to upskill staff in Data Science, internal “AI academies” now stand out as insurance firms’ best route to closing the skills gap. These internal capability programs can fast-track company-wide knowledge, embed AI fluency across every function, and turn technical literacy into a core business competency.

“High-performing talent will remain the backbone of the insurance industry. Despite technological advancements, it’s still the human touch that discerns nuances and makes strategic decisions. But the pressing question is: Where will the next generation of talent come from?” – Barclay Burns, Partner

11. The talent clock is ticking

The insurance talent crisis has moved from forecast to cold reality. The US Chamber of Commerce projects that half the current workforce will retire within 15 years, leaving 400,000 roles empty, and underwriters are already exiting at double-digit rates. The firms that retain and attract top talent won’t be those hiring fastest, but those building strategically: developing future leaders, modernizing their Employer Value Propositions, and creating cultures where their best people feel trusted, empowered, and heard.

12. CTOs will be insurance’s best talent bet

As insurance goes fully digital, 2026 will mark a new contest for innovation, where traditional carriers square up against insurtechs, whose market is on track to hit $306.5 billion by 2030. Despite rising tech spend and newfound confidence in AI, many firms still lack the innovation muscle to compete. The Chief Technology Officer (CTO) will be the most valuable hire insurance firms can make here: steering R&D, advancing data science and fraud analytics, shaping smarter client experiences, and forging insurtech partnerships that turn disruption into long-term advantage.

Wealth Management Trends

“We’re watching wealth management evolve into a different beast. Next-gen heirs, a workforce that’s aging out, PE money making the war for top advisors even more competitive – a lot of forces are at play. The firms that lean into them with curiosity and courage will be the ones setting the pace.” – Daniel James, Managing Partner

13. The Great Wealth Transfer will be a make-or-break moment

The $105 trillion Great Wealth Transfer is set to redraw the competitive map of wealth management, and determine who stays relevant in 2026 and beyond. More than $61 trillion will move to Millennials and Gen Z – in other words, clients who have different expectations, different values, and very little loyalty to their family’s legacy advisor. Firms need to modernize and align with next-gen priorities, such as by offering seamless digital experiences, sustainable portfolios, and authentic engagement. That will be the difference between capturing the Great Wealth Transfer or getting left behind by it.

14. New heirs want new advisors

In light of The Great Wealth Transfer, firms must start thinking if the talent they have is best placed to serve the next generation of the ultra wealthy. Nearly 40% of financial advisors are approaching retirement, and there aren’t enough coming up the ranks to fill the vacuum. But it won’t just be about having enough, it will be about having the right kind of advisor. Younger clients want someone who looks and thinks like them. 70% of women inheritors, for example, walk away from their parents’ advisors because they feel they don’t understand their priorities. The next era of wealth management won’t be led by grey suits and legacy mindsets, but by a new breed of advisors who reflect their clients’ values, language and lived experience.

15. Capturing in-demand talent

The war for top advisory talent will only intensify in 2026. Wealth management remains a candidate-driven market, and high-producing advisors with million-dollar books know their worth. Many are already on the move, weighing independence, new platforms, and more flexible models that align with their clients’ needs. The real contest won’t be over compensation alone but over culture, autonomy, and seamless transition support. Firms that treat recruitment like a long-term partnership, not a transaction, will stand out as top destinations for elite talent.

16. The RIA boom accelerates under PE backing

Private equity capital will accelerate the great advisor migration toward RIAs. As financial advisors continue their exodus from wirehouses, the RIA channel is gaining momentum, projected to grow 4% annually through 2028, while traditional wirehouses contract by nearly 2%. PE firms are betting big on RIAs’ lean, high-margin, predictable-cash-flow model – a formula tailor-made for aggressive growth and lucrative exits. They’re also hunting for talent that can multiply that value: advisors with loyal books, strong client relationships, and long-term growth potential. For elite producers, this means unprecedented opportunity, and it’s precisely that pursuit of top talent that will accelerate the shift toward the RIA model.

Healthcare Trends

“The most challenging part of healthcare in 2026 won’t be the technology, or new care delivery/financial models. It will be finding the right leadership who can navigate this disruption flawlessly – who can operationalize change, maintain trust with patients/members and staff, and bring their organization into the future.” Alex Drury

17. AI becomes the new clinical infrastructure

In 2026, AI will stop being “a tool” and edge closer to becoming the operating system of healthcare. Autonomous AI agents will handle end-to-end patient journeys – symptom intake, scheduling, test coordination, result interpretation, follow-up prompts – freeing clinical teams to focus on complex judgment calls and care relationships. In R&D, generative models will be used to test thousands of molecule interactions in hours and surface viable candidates long before a human-led process could. Meanwhile, AI will shift diagnosis from reactive interpretation to continuous prediction, catching diseases earlier.

These groundbreaking healthcare technologies will demand healthcare leaders who can balance speed and risk: technologists who understand clinical nuance, and clinicians who can drive transformation without breaking patient trust.

18. Virtual hospitals move from pilot to primary

Telemedicine was the warm-up. 2026 is the year virtual hospitals scale. These have evolved far beyond remote consultations, becoming fully integrated hospitals without real estate: diagnostics, monitoring, care planning, and follow-up managed through an ecosystem of connected devices and remote specialists. Driven by a shortage of healthcare specialists, and an aging patient population that prefers home-based care, virtual hospitals promise to reduce costs and increase throughput. But this delivery model will only work if clinical talent embraces a different playbook. The most in-demand clinicians will be those who are confident conducting digital assessments, comfortable making decisions supported by data, and able to establish human connection through a screen with the same depth as in person.

19. Rapid disruption demands a new type of healthcare leader

A wave of leadership exits will hit healthcare in 2026, with 46% of healthcare leaders planning to leave their jobs over the next 12 months. Combined with political uncertainty around Medicare and Medicaid, a spike in executive fatigue, patient expectations reshaped by consumer tech, and a tech transformation that won’t slow down, organizations face a glaring leadership vacuum. To navigate the turbulence, organizations will need a new leadership archetype. The future healthcare leader won’t be defined by tenure or credentials; they’ll be defined by adaptability. Organizations will increasingly need people who can translate AI into a care model, rally exhausted staff behind a new direction, manage transformation without sacrificing culture, and navigate stakeholder politics while maintaining patient trust.

Talent Trends

“Across the industry, the definition of talent is changing. The firms pulling ahead are the ones backing bold thinkers, not safe bets; people who challenge, adapt, and raise the standard for everyone around them.” – Antony Pitt, President – USA

20. A widening talent deficit behind the tech boom

By 2026, the digital skills gap will hit crisis scale, affecting nine in ten organizations. With the pace of new technology eclipsing the pace of human capability, the skills that were valuable a year ago are already losing relevance, and the half-life of technical expertise is shrinking by the month. AI fluency, data literacy and adaptive learning must become baseline competencies. Firms that don’t hardwire continuous learning into their culture will find their biggest barrier to innovation isn’t technology, but how effectively their people are enabled to evolve with it.

21. Boards raise the bar for executive talent

The executive bar in financial services is rising fast. With economic pressure, tighter regulation, and AI reshaping decision-making, boards can no longer afford “safe” hires – they need transformative ones. The new FS leader blends financial acumen with digital fluency, able to steer strategy, interrogate AI outputs, and lead change across functions. Traditional backgrounds in economics or regulation still matter, but only when matched with agility, innovation, and a challenger mindset. In 2026, technical literacy and transformation experience will separate the leaders equipped to drive progress from those who simply aren’t built for the change ahead.

22. New titles arriving in the C-suite

New leadership roles will enter the C-suite in 2026. Roles that barely existed five years ago – Chief Data Officer, Chief Data Scientist, Chief Information Security Officer, Chief AI Officer, Chief Analytics Officer – are now core to corporate strategy. As AI, data and cybersecurity become business-critical, these leaders have risen from support functions to growth engines and risk guardians rolled into one. This time next year, every serious financial institution will treat this type of leadership as non-negotiable, with new titles continuing to emerge wherever technology and governance collide.

23. The sales retention challenge for PE & VC

“PE and VC firms are moving from momentum to margin, prioritizing tangible revenue impact over speculative growth. That pressure lands squarely on the shoulders of the sales teams. To continue winning revenue in 2026, PE and VC firms need to give their sales talent real engagement from the top.” – Matt Supsak, Associate Partner

PE and VC firms are already facing a retention reckoning in sales, and over the next 12 months, this will only become starker. Top performers are under pressure to drive growth, efficiency, and predictable returns, often with fewer resources and higher expectations. The smartest firms will overhaul how they reward and engage commercial talent, linking incentives directly to impact and giving sales leaders a real seat at the strategy table. Those that cling to outdated comp models and top-down cultures will lose their best rainmakers, and the relationships that power their deals.

Executive Search Trends

“Executive hiring has become a high-stakes discipline. Every decision now sits closer to strategy, and the difference between a good hire and the right hire is the difference between momentum and mediocrity.” – James Ridd, Americas CEO

24. From reactive recruitment to predictive hiring

Amid all of the changes that 2026 will bring (rapid tech adoption, fierce competition, economic volatility), hiring when vacancies occur will be too costly. To protect momentum, firms must start anticipating talent needs before vacancies occur. Predictive hiring – powered by data, market intelligence and continuous relationship-building with top talent – will become more popular in response to this. Firms that maintain ongoing partnerships with executive search specialists who track and engage top performers in real time will stay ahead of attrition and opportunity alike. Those that don’t will find themselves perpetually hiring from behind.

25. The new rules of tech leadership hiring

Hiring tech leaders in 2026 can no longer be an extension of general executive search. It’s becoming an entirely different discipline that requires its own playbook. Tech leaders are in a league of their own, balancing deep technical mastery with commercial instinct. They’re also among the most mobile and discerning talent in the market, courted daily by firms promising influence, autonomy, and impact.

Winning these individuals requires sourcing strategies built on precision: a value proposition that articulates purpose and innovation, constant ecosystem mapping, and data-led assessments that test both vision and capability. Firms who lean on specialized search partners – who know this complex game inside-out and already have trusted talent networks to tap – will reach the leaders no one else can see. While those still relying on conventional methods will be left competing for who’s left, not who’s best.

26. The gig economy reaches the boardroom

Leadership in FS is becoming increasingly modular as we approach 2026. Venture-backed fintechs and growth-stage firms in particular are moving away from locking in costly, full-time executives before scale demands it. Instead, they’re tapping into fractional or interim executive hires, who bring heavyweight experience without permanent overhead. It’s not just about saving cash; it’s a structural rethink of how leadership is deployed. In 2026, the executive gig economy will move from experiment to norm, with agility valued over permanence and impact measured in outcomes, not tenure.

27. Precision hiring replaces growth hiring

Executive hiring in FS is entering its precision era. The practice of volume hiring is rightly being usurped by strategic selectivity: firms hiring fewer, but better leaders, ones who directly move the dial on transformation, risk and profitability. Every mandate we’re seeing today is tightly aligned to strategic inflection points, whether it’s succession planning, fintech disruption or cost-cutting. As a result, boards are prioritizing roles like COOs and CFOs with turnaround expertise, CTOs and Data Officers to lead digital transformation, or ESG heads to meet regulatory and stakeholder demands. The shift is from growth hiring to impact hiring, with every appointment being scrutinized, and every role expected to deliver visible results fast.

28. Contingency search becomes ineffective

Retained executive search partnerships will bring that ambition to bear – the ambition to hire with precision, impact and foresight. As executive hiring becomes more targeted and high-stakes, contingency models, known for their speed, surface-level reach and transactional nature, won’t be enough to reach exceptional people.

“Despite having once worked at the top echelon of contingent firms, since I’ve been working with Hanover, I’ve seen the level of service and execution at a retained firm. The difference is night and day.” – John Chaintreuil, Associate Partner

In 2026, boards will look beyond résumé delivery to strategic partnership; the complexity of today’s leadership market demands it. Retained search, grounded in data, market intelligence and long-term alignment, will emerge as the natural response to that need. As executive roles grow more specialized and consequential, the transactional speed of contingency search will lose relevance. Precision hiring depends on insight, not volume, making retained partnerships the defining model of 2026.