Today, most consumers aren’t comfortable with the idea of AI independently renewing their insurance policies or switching coverage on their behalf. But many insurance brands believe that’s about to change.
A significant proportion of insurance leaders (44%) expect customers to happily delegate renewals and policy updates to AI within the next five years. Even more believe customers will be comfortable with AI autonomously comparing policies across providers and detecting suspicious activity or fraud.
Where else do insurance brands expect AI to reshape customer experience (CX)? And how can they encourage more hesitant customers to move with the times, while preserving confidence in their products and services?
The insurance edition of our 2027 CX trends report offers some compelling answers. Grounded in interviews with 100 insurance leaders and 4,000 consumers, it provides a window into the attitudes, concerns, and expectations of both groups, as AI increasingly becomes an autonomous orchestrator, trusted to make decisions and take action throughout the customer journey.
Where do insurers expect AI to transform CX?
Ask insurance brands where AI will have the greatest impact on CX and most point to its power to help customers understand coverage and policy decisions.
But this use case wins by a nose, ahead of a very large pack. Almost as many insurance leaders highlight AI’s ability to transform claims handling and resolution, to proactively prevent risks, and to personalize policies, pricing, and communications.
As we’ve seen, many insurance brands believe customers will grow comfortable with AI autonomously performing a range of policy-related tasks within the next five years. Within ten, the vast majority (81%) believe customers will routinely allow AI to decide and act on their behalf.
That’s a step change from today. At present, just 50% of consumers say they would be happy to let AI make more decisions for them — even if it consistently delivered the best possible outcome. And automation isn’t the only area in which insurance brands must make sure AI-driven innovation doesn’t outpace the comfort levels of policyholders.
Where do brands risk leaving some policyholders behind?
Insurance leaders believe in the potential of emotionally intelligent AI to enhance the customer experience. More so than business leaders in any other industry we survey. The majority (58%) say the technology will help companies to adapt support to each customer’s unique circumstances.
But many older customers remain uncomfortable with AI using their personal data to engage them with empathy. Just over a quarter of Gen X consumers balk at the prospect, a figure that rises to 40% among Baby Boomers.
Similarly, insurance companies are preparing for AI assistants to become a key gateway to their brands, while most of today’s consumers are still starting common customer journeys in more traditional ways.
Seventy-eight percent of insurance leaders say influencing AI assistants is becoming as important as influencing customers directly. But ask consumers how they actually compare insurance policies, for example, and you’ll find just 17% prefer to start by chatting with an AI assistant. Many more still favor using search engines or comparison sites and marketplaces.
Where are insurance brands more cautious about AI’s impact?
Insurance companies are accustomed to sharing customer journeys with a complex partner ecosystem. But compared to brands in other industries, they anticipate more bumps in the road as AI begins to orchestrate journeys across platforms and partners.
Most insurance brands mention the difficulty of establishing accountability when things go wrong. Many raise challenges such as retaining ownership of the customer relationship, maintaining trust across providers, and protecting customer data and privacy.
This is one aspect of CX, however, in which many consumers are more than ready for AI to make its presence felt. Sixty-seven percent feel frustrated when they have to jump between apps and platforms to achieve a single outcome. The majority (57%) would be glad for AI to do the legwork, making their lives easier by managing activities across multiple brands.
The next steps for insurance brands
If insurance companies are to build trust in AI-driven automation and empathetic engagement — and swerve the potholes they see on the road to AI-orchestrated, end-to-end journeys — they’ll need to begin by building the right data foundation. One that helps brands:
- Understand customers and their journeys, in real depth. Without this understanding, insurance brands will struggle to implement AI intentionally and impactfully. They’ll risk removing friction that customers actually value, while missing out on AI’s potential ROI.
- Recognize customers and their preferences, across channels and touchpoints. To reassure more hesitant customers, insurance brands should look to grant individuals control over AI-driven experiences.
- Put the right safeguards in place. Again, listening to customers will be key. Consumers rank making sure data is protected and used responsibly in their top three AI safeguards. Among insurance brands, we find it’s currently the least common priority.
Some insurance leaders believe they have successfully put this foundation in place: 38% say they already have the data and technology they need to support AI-managed experiences. Another 52% are already making strides towards preparedness, even if they still have gaps. Simply put? The race to weave AI throughout the insurance CX is well and truly on.
For a deeper dive into how insurers and consumers are gearing up for empathetic, friction-reducing, journey-orchestrating AI, download From influence to action: Why insurance brands must apply AI intentionally as it takes a more autonomous role in CX.
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