Consumer confidence in AI has stagnated in 2026, according to Smart Communications'
Consumers are overall less confident about AI usage in insurance, with confidence dropping from 46% in 2025 to 40% this year, according to the report. Only 39% of consumers are confident about AI tools handling their information securely, and just as many are confident that AI would use their information ethically.
Most respondents, 85%, say it is very important that insurers disclose when AI is used in communications, and respondents say that they would be willing to support such uses if AI delivers specific benefits. AI's ability to yield faster response times is the highest priority among 48% of insurance customers, followed by 41% looking for higher accuracy and 37% hoping for cost savings.
"This research indicates that organizations are reaching a tipping point," said Leigh Segall, CEO of Smart Communications. "Customer expectations continue to rise, but many businesses are struggling to keep pace. Consumers are telling us they will switch providers when communications fall short or break down across channels, and they are becoming more selective about how and where they trust AI. For regulated industries, where interactions often involve healthcare decisions, insurance claims, financial guidance or government services, the stakes couldn't be higher. The organizations that succeed will be those that simplify complex interactions, apply AI responsibly and transparently, and create experiences that build trust at every step."
Consumers are also interested in AI improving customer experience and personalization. According to the report, although many insurers are employing AI, execution may not always meet expectations. More than half, 56%, of consumers believe AI and generative AI will improve the customer experience in the next five years, but only 38% of consumers find AI-powered tools helpful in resolving questions or completing tasks.
One-third of consumers are also willing to accept AI in communications with their insurers if such tools offered improved data security. With the rise in data breaches targeting the insurance industry, data and privacy concerns remain high. Nearly half, 48%, of respondents say that data privacy and security are their main concerns about AI use in customer communications — and just as many cite the lack of human oversight as their greatest worry.
Consumers trust their insurers' handling of personal information more than they trust insurers' AI use, according to Smart Communications' data: while only 43% trust insurers to use AI responsibly in a way that benefits them, 71% trust insurers to handle their personal data responsibly.
