P&C Customers Warm to AI Tools, But Demand Human Oversight on Claims
U.S. consumers are using artificial intelligence more frequently and accepting it in insurance operations, but remain skeptical about letting algorithms make coverage and claims decisions, according to Insurity's 2026 AI in Insurance Report.
The survey of more than 1,000 adults, conducted in February 2026, shows sentiment has recovered sharply from a year earlier. In 2025, only 20% of consumers supported insurers using AI. That figure jumped to 39% in 2026.
The shift reflects broader adoption. Eighty-four percent of consumers now use AI tools at least occasionally, with 27% using them daily. As generative AI becomes embedded in writing, productivity, health queries and financial planning, consumers have stopped viewing it as experimental.
Clear Line Between Assistance and Autonomy
Consumers distinguish sharply between AI as a helper and AI as a decision-maker.
Forty-six percent said they would accept AI generating a quote. Thirty-nine percent are comfortable with AI tracking claim status, and 38% would use it to update personal information.
Support drops significantly when AI takes autonomous action. Only 22% would allow AI to file a claim on their behalf. Just 16% accept AI canceling or renewing a policy without human input.
Nearly half expressed discomfort with AI making determinations on claim approvals, fraud flags or policy adjustments. Only about one-third trust AI-driven insurance decisions overall, while 26% said they need more information before forming an opinion.
Jatin Atre, president at Insurity, said the takeaway is clear: "Consumers have moved past the hype cycle. They are not impressed by the fact that insurers are using AI. They care about how it is being used."
Atre warned that deploying AI "simply to cut costs or automate decisions without explanation" will erode trust. The technology builds confidence when used to improve underwriting, speed claims processing and clarify interactions-with visible human oversight.
Regulatory Scrutiny Intensifying
The sentiment shift comes as insurers increase AI spending and regulators tighten oversight.
An Accenture survey found 90% of global insurance executives plan to increase AI spending in 2026, with many reporting early gains in combined ratios and claims efficiency.
The National Association of Insurance Commissioners is expanding its review tools. Its Big Data and Artificial Intelligence Working Group is piloting an AI Systems Evaluation Tool for market conduct and financial exams, designed to assess governance, risk mitigation and high-risk models in underwriting, pricing and claims.
Consumer concerns about opaque or biased algorithms remain central to regulatory discussions. NAIC principles adopted in 2020 emphasize fairness, accountability and transparency. Several states have issued bulletins echoing these standards, and state legislatures are beginning to consider AI-related consumer protections that could affect insurance.
The Human-in-the-Loop Question
The survey reveals tension between pressure to automate and customer expectations for human involvement.
Front-end, low-stakes interactions are the safest ground for customer-facing AI. Separate Insurity research from 2025 found only 15% of consumers want a fully digital, self-service insurance experience. Nearly half prefer a "digital-first" model with easy access to human support when needed.
Positioning AI as the primary decision-maker on claim payments, fraud determinations or renewals risks triggering complaints and regulatory scrutiny if customers feel adverse outcomes are driven by unexplained algorithms.
Insurance intermediaries may increasingly face questions about how carriers use AI in underwriting and claims, whether humans remain involved in difficult decisions, and how customers can challenge automated outcomes. Those that translate technical practices into clear, plain-language explanations may be better positioned to retain clients as adoption grows.
Insurity's 2026 data suggests consumer attitudes are normalizing after the 2025 dip, when AI hype peaked and concerns about fairness and job displacement intensified. As everyday usage rises and concrete use cases emerge, the industry is moving from AI for Insurance pilot projects into core operating infrastructure.
Industry analysis suggests the global AI in insurance market could reach tens of billions in annual value by decade's end, with early adopters reporting measurable gains in loss ratios, claims cycle times and fraud detection. The challenge for carriers is deploying that technology in ways customers understand and accept.
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