This piece is by Julie Getzlaff, Senior Product Marketing Director, Guidewire
AI has been around for decades but it wasn’t until OpenAI released its demo of ChatGPT in November 2022 that AI and all of its possibilities captured the collective imagination of the public, governments, and businesses worldwide.
While some sectors are still wondering how they might benefit from AI, the insurance industry has already proved the usefulness of predictive analytics and today many insurers are leveraging machine learning to make better risk decisions. Now these same insurers want to expand the use of ML to price risk intelligently, lower expense ratios, and reduce the protection gap. They also want to implement GenAI to improve productivity and customer service across the insurance lifecycle.
The caveat is that none of this will be possible without the acceptance of insurance customers, many of whom have expressed concern about how their personal data might be processed by AI and used by insurers. So, what is the current situation with regards to customer perspectives on their insurers using AI?
Some answers are provided by the latest findings of the Guidewire European Insurance Customer Attitudes Study, which has been running since 2020 and surveying AI attitudes for the last two years.
COMFORT ZONE
Insurers are becoming increasingly comfortable with insurers’ use of AI. The number of customers who are comfortable with insurers using AI to decide the price of an insurance policy without human intervention has increased from 31% in 2024 to 37% in 2025. When it comes to AI being used to process and settle a claim without human intervention, there has been a slight increase in comfort in 2025 — one in three customers are comfortable with this happening.
The underlying factor appears to be insurance customers’ own experiences using generative AI. Of the representative sample of insurance customers polled, the number who are using an AI tool at least once a week has risen from 21% in 2024 to 33% in 2025, while those who have never used an AI tool has dropped from 40% to 28%.
The power of this familiarity with generative AI is significant. For example, one in two consumers who use AI tools a few times a week are comfortable with AI managing an insurance claim with no human involvement. For daily AI users, most of them (69%) are happy with this use of AI.
While the warming of customer attitudes towards AI gives insurers something to build on, they cannot be complacent. There remains a great deal of scepticism about how AI will improve services — one in three UK consumers said that nothing could give them confidence in insurers using AI.
While this consumer resistance has dipped from 41% in 2024, it is substantial. So how can insurers address these concerns?
One strategy is that insurers need to reassure customers that they have control over how AI is being used. They should be transparent about how AI is being deployed, but also about how the system enables a smooth handover from AI to a human agent if required by the customer. In our study, the ability to refer an AI decision to a human operator is still the top factor (40%) that would make customers more confident in their insurer using AI. The saliency of this is underlined by how much less important customers consider the availability of an independent regulator to police the use of AI by insurers (22%).
CUSTOMER UNDERSTANDING
Aligned with this strategy is how insurers continue to do more to reassure customers about the responsible use of data to provide personalised services. Access to data is key to any greater use of AI in everyday insurance processes, but there are signs that customers remain concerned about how their data is being used.
The number who say that they do not understand why insurers would collect data from connected devices to better understand risk and see it as an invasion of privacy has risen from 19% in 2024 to 24%. While it was higher in 2022 (27%) it had subsequently fallen, suggesting a reversion back to a more privacy-conscious mindset. On the positive side, our study reveals that the number of consumers who think that insurers collecting data is a good thing, helping them to improve services and reduce prices for low-risk policyholders, has risen from 28% to almost one in three customers (32%)
Insurers must continue to communicate how the sharing of customer data delivers real value in terms of better services and lower costs.
Better customer familiarity with AI will help insurers integrate AI into their services, particularly for younger customer segments. But insurers need to be aware that many customers still want to be able to call on human support if required, and must build trust in their use of data for AI.
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