88% customers prefer human insurance advisors, but AI has potential to ease sector challenges, survey shows

A global survey by UserTesting, a provider of experience research, has revealed that whilst customers preferred to receive guidance from human insurance advisors, AI has potential to mitigate customer challenges and simplify processes, particularly during enrolment and provider selection.

The survey, conducted by Talker Research, surveyed 4,000 adults from Australia, the US and UK to explore challenges faced by consumers in insurance enrolment and how AI could potentially mitigate these challenges.

The findings revealed that, whilst globally 88% of respondents prefer to receive insurance guidance from a human, interest in AI is on the rise as customers seek simple solutions.

For instance, 56% of respondents would rather deal with everyday annoyances, such as sitting in traffic (10%), living with their parents again (19%), or attending a concert of an artist they don’t like (24%), than navigating the complexity of insurance enrolment, demonstrating a growing demand for a simplified, streamlined processes.

Insurance Complexity

The survey highlighted that consumers view insurance as complex and challenging, particularly when it comes to navigating enrolment and choosing the right insurance provider. Survey participants across Australia, the US, and the UK responded that they would rather deal with unrelated frustrations than manage insurance complexities:

• 13% of US respondents said they would rather sit in traffic, compared to 9% of UK and Australian respondents.
• 14% of US participants would listen to one song on repeat for an extended period, while 12% of those in the UK and Australia would do the same.
• 22% of US respondents would choose to live with their parents again, compared to 18% in the UK and Australia.

Confidence in Coverage vs Challenge of Choosing a Provider

Whilst most respondents felt confident about their coverage, they also viewed choosing the right provider as a challenge; 68% of British respondents felt confident about their coverage, yet struggled to choose the best insurance provider.

Knowledge Gaps

The survey also gave an insight into which areas customers felt most and least confident about, with British respondents being most familiar with home (75%) and auto (68%) insurance, but lacking knowledge about pet (53%) and dental (44%) coverage.

Ongoing Challenges

The findings also revealed that consumers are still encountering significant issues navigating the insurance landscape. Of British respondents, 28% reported a lack of clarity on coverage details, 23% felt the impact of unnoticed premium increases impact, and 23% found complicated claims processes were a challenge.

AI as an emerging tool for insurance

Whilst most consumers continue to favour human advisors, AI is increasingly being seen as a tool to simplify and streamline insurance process and decisions.

The survey revealed that 36% of respondents in the US and UK, and 25% in Australia, believe AI can assist in understanding complex insurance information, whilst, looking ahead, 45% of Australians, 39% of UK respondents, and 33% of US respondents think AI could play a useful role in comparing insurance plans.

Principal marketing manager for insurance solutions at UserTesting, Bee Nookala, noted that consumers are asking for more transparent and straightforward insurance processes, as “[w]hile human advisors remain critical, AI offers insurers a way to help customers navigate complex policies more efficiently, provided human support is always an option when needed.”