Consumers Weigh in on AI Use in Severe Weather Insurance

Insurity’s 2025 AI in Insurance Report sheds light on consumer attitudes toward the use of artificial intelligence (AI) in property and casualty (P&C) insurance, particularly for managing severe weather risks. The report found that while nearly half of consumers (45%) feel comfortable with insurers using AI to provide real-time alerts on weather-related risks, a significant portion (42%) worry about how the accuracy of predictions could impact premiums or coverage decisions.

Although concerns exist, the report highlights opportunities for insurers to foster trust. For example, 26% of respondents are more likely to trust AI-based severe weather warnings than traditional forecasts. However, only 20% feel it is critical for their insurer to utilize AI for risk prediction and mitigation. To address these gaps, insurers must emphasize the practical benefits of AI, be transparent about the limitations of these tools, and ensure they improve the customer experience without adding financial burdens.

Chris Lafond, CEO of Insurity, noted that severe weather events are increasing in both frequency and severity, creating a demand for faster, proactive solutions. Real-time AI-powered insights have the potential to reduce claims costs and strengthen customer relationships, but only if insurers balance reliability with clear communication.

The findings, based on a January 2025 survey of over 1,000 U.S. adults, underscore the growing importance of educating policyholders about AI in insurance. By addressing consumer concerns head-on and demonstrating how AI can provide proactive protection without unnecessary costs, insurers can better position themselves to build trust and remain competitive in the evolving insurance landscape.