Insurers Adopt AI for Claims and Sales, Risks Rise

Dig-in reports that artificial intelligence is reshaping how consumers shop for policies, how carriers price products and how claims are handled. Per Dig-in, JD Power's 2026 U.S. Insurance Shopping Study found auto shoppers averaged 3.5 quotes - the highest level in the study's 20-year history - and that digital purchases rose from 36% five years ago to 48% of policies bought online today. JD Power managing director Stephen Crewdson attributed the trend to mobile apps and AI tools making it easier to compare and understand options. A separate EIP/Censuswide survey of 250 senior U.K. and European insurance professionals found 90% expect claims administration to be managed end-to-end by AI within 24 months; EIP director David Mitchell-Dawson noted the average expectation among respondents is 15 months. The article cites U.S. water damage figures of roughly $13 billion in annual insurer costs and average claims above $15,000 to motivate continuous underwriting approaches.

EIP and Dig-in both note that claims decisions must be consistent, transparent, and auditable - requirements that constrain pure probabilistic AI systems. The EIP survey found 99% of professionals believe some level of human oversight must accompany AI-driven outcomes, and 87% are concerned about bias. Only 10% of respondents ranked cost as a strong procurement factor, signaling that governance, integration, and auditability weigh more heavily than headline price when evaluating AI tools for insurance operations.

For practitioners: track regulatory guidance on auditability, vendor governance frameworks, and standards for sensor telemetry. Also watch operational controls that preserve human review in high-risk decisions and engineering patterns needed to produce reproducible decision logs for both model and rules-based components.