Americans using AI to even the odds against confusing insurance policies

NEW YORK — Insurance is supposed to give people comfort when unexpected disasters strike. Unfortunately, a new survey finds the process of getting insurance is so painful now that most Americans don’t even want to go through the frustration.

In fact, a large number of Americans would rather deal with endless traffic than sit down and sort through insurance options. The poll of 2,000 adults found 58% would rather suffer through many of life’s annoyances if it meant never stressing about understanding insurance policies or enrollment processes ever again.

In addition to enduring endless traffic (13%), many adults would rather live with their parents again (22%), go to the concert of an artist they don’t like (22%), and even listen to one song on repeat for an entire year (14%).

Commissioned by UserTesting and conducted by Talker Research, researchers sought to understand the frictions people experience as insurance enrollment undergoes a digital revolution. Although 65% of respondents said they felt confident in their understanding of what they’re insured for, over one in three (36%) are turning to artificial intelligence (AI) as a helpful tool for making sense of complex insurance information. However, the vast majority of consumers said they prefer getting their insurance advice from human advisors, as opposed to AI (86%, compared to 14%).

Despite this, many still believe AI can assist them in some way: either by comparing insurance plans (33%) or by simplifying coverage terms that often overwhelm the average consumer (25%). 

In contrast to getting advice from human advisors, one in three respondents said they felt more comfortable sharing their personal information with AI instead of humans — claiming they felt AI would better protect their privacy (43%) and wouldn’t judge them (35%).

Despite the appeal of using AI, some skepticism remains. Over a third (38%) of respondents said they feel less comfortable sharing personal information with AI, stating they don’t trust AI as a whole (56%) and citing a fear that their data would be shared without consent (44%). 

Other concerns include the lack of a personal connection (40%) and doubts about the accuracy of AI-generated recommendations (36%). Even with their concerns, 38% said they’d be “open to using AI” for insurance advice in the future. 

“Consumers are increasingly embracing AI to demystify insurance policies,” says Bee Nookala, Principal Marketing Manager of Insurance Solutions at UserTesting, in a statement. “Many trust AI to offer more privacy and unbiased advice than a human agent. It’s clear that AI is poised to play a crucial role in transforming the future of insurance, but it’s equally important that companies balance this with the human touch customers still crave.”

The study also revealed that Americans felt most informed about health insurance (78%) and auto insurance (75%), followed by dental insurance (65%), home insurance (61%), and pet insurance (39%). When explaining what factors were most important to them while choosing insurance, respondents said the cost of coverage (69%) was the top priority, surpassing potential coverage (61%), customer service (36%), and ease of understanding their policy (34%).

Many still encounter significant challenges when dealing with their insurance providers, including a lack of clarity on coverage details (27%), unnoticed premium increases (24%), complicated claims processes (20%), poor customer service (19%), and difficulties navigating online platforms (14%). 

“In today’s economy, cost of coverage is the top priority for consumers, but it’s clear that customer service and ease of understanding are the areas where insurers can make the biggest impact,” Bee concludes. “Simplifying the process and offering better digital experiences could be the key to winning consumer trust.”