Insurance consumers are losing faith in AI, according to Insurity’s 2025 AI in Insurance Report, with only 20% supporting its use across the P&C insurance sector, down from 29% in 2024.
Skepticism is growing, as 44% of consumers now say they are less likely to buy from an insurer that publicly uses AI, up from 42% last year, according to FF News.
Positive experiences with AI have also dropped significantly, from 63% in 2024 to just 47% in 2025. However, consumers are more accepting of AI when they understand its purpose, particularly in areas like real-time severe weather monitoring and alerts.
“These shifts in consumer sentiment serve as a critical reminder for insurers – while AI has the potential to revolutionise the industry, its success depends on how it’s implemented and communicated,” said Sylvester Mathis, Chief Revenue and Chief Insurance Officer at Insurity. “Consumers want to know how AI benefits them directly and need reassurance that it’s being used responsibly and transparently. Insurers who focus on education, demonstrate fairness in AI-driven processes, and showcase real-world success stories can turn skepticism into confidence and drive meaningful engagement.”
The report highlights a generational divide in attitudes toward AI, with Gen Z maintaining steady support at 25%, while Millennials saw the most dramatic decline—from 41% in 2024 to 26% in 2025.
Gen X sentiment also fell, dropping from 34% to 20%, while Baby Boomers declined from 13% to 10%. These shifts reflect broader concerns about AI’s transparency, reliability, and value.
Despite these challenges, the findings present opportunities for insurers to rebuild trust. Clear communication about AI’s role in faster claims processing, real-time severe weather alerts, and risk assessments can help demystify its benefits.
Educating consumers on AI’s capabilities and limitations while sharing success stories and data-driven results can reinforce its value. By focusing on transparency and real-world advantages, insurers can bridge the gap in consumer sentiment and enhance policyholder trust.
