Nearly 50% of financial services and insurance companies face high-business-impact outages weekly; AI-powered observability and tool consolidation emerge as key solutions
New Relic has released its State of Observability for Financial Services and Insurance report, shedding light on how digital-first strategies, cloud adoption, and artificial intelligence are reshaping the operational fabric of the financial services and insurance (FSI) sectors.
The findings, drawn from New Relic’s 2024 Observability Forecast, reveal that 48% of FSI respondents experience at least one high-
business-impact outage per week, with the median cost of downtime pegged at $2.2 million per hour—a figure 16% higher than the cross-industry average.
“Observability powered by AI is redefining uptime and trust in the financial sector,” said Simon Lee, SVP & MD, Asia Pacific and Japan, New Relic.
“As we accelerate toward an intelligent world, embedded security and reliability are no longer optional—they are core to digital infrastructure,” added Benders. “Observability, particularly when enhanced with AI, is helping enterprises reduce downtime, optimize legacy systems, and meet rising customer expectations with confidence.”
Over 41% of respondents in the report identify AI adoption as a central driver for observability investments, with specific use cases like AI-assisted troubleshooting (34%), automatic root cause analysis (32%), and AI-assisted remediation (32%) gaining traction.
“Across APAC, financial institutions are under mounting pressure to modernize. Downtime now means lost trust,” added Lee. “AI-driven observability is empowering early adopters to detect and respond to incidents faster, improving digital resilience and enabling innovation.”
“Modern organizations can’t afford blind spots—full-stack observability is now a boardroom-level priority,” said Nic Benders, Chief Technical Strategist, New Relic.
The FSI sector is leading in cloud-native application development (36%) and container adoption (28%), according to the report. Yet, tool sprawl and data silos remain critical challenges, prompting 49% of respondents to prioritize consolidating observability platforms within the next year.
Respondents also reported a median annual ROI of 297% from observability investments. These tools not only reduce mean time to detection (MTTD) and resolution (MTTR) but also enhance operational efficiency and customer experience.
“Customers must have a digital experience with high performance, usability, and accessibility. New Relic is the main tool today for internal decision-making—not only technology decisions, but also strategic ones,” said Carlos Pedrosa, IT Director at Banco Inter.
The report underscores that organizations with full-stack observability experience faster MTTD and MTTR, proving its efficacy in mitigating both financial and reputational risks. Observability is now viewed not just as a technical function but as a strategic enabler across CIO and CISO mandates.