AI in Insurance Faces Customer Skepticism Over Trust, Fairness, and Claims Use

As artificial intelligence becomes more embedded in the insurance ecosystem, customer sentiment is shifting—but not uniformly. A recent J.D. Power survey reveals that while U.S. insurance customers increasingly accept AI in routine interactions like billing and status updates, many remain uncomfortable with its use in high-stakes decisions such as claims processing and pricing. This presents a critical challenge for insurers—and a key area of concern for claims adjusters navigating consumer expectations and technological integration.

Nearly half of those surveyed expressed discomfort with AI handling claims, signaling a strong preference for human oversight in decisions that directly impact their financial outcomes. For claims professionals, this skepticism underscores the importance of maintaining transparency and personal engagement during the adjustment process, especially as insurers explore automation to cut costs and improve efficiency.

Notably, only 15% of customers support full AI integration in pricing policies, while a third call for limits until ethical standards are met. This hesitance reflects broader anxieties about algorithmic bias and regulatory compliance, issues that claims teams must be aware of as they handle increasingly tech-influenced cases. For adjusters, this means understanding both the operational potential of AI tools and the reputational risks they carry if used without proper guardrails.

As insurers accelerate digital transformation, customer education and transparency will be critical. Those in the field—especially adjusters who serve as the face of the company—will play a pivotal role in reinforcing trust while adapting to AI-driven workflows. Adjusters should be prepared to explain AI decisions when necessary and advocate for ethical AI usage that maintains customer confidence.