Intelligent self-service and AI help insurers keep customers by letting them buy or renew a policy, and make and follow a claim, quickly and without waiting for an agent. Behind the scenes, AI analyses customer data instantly, assesses risk more accurately, settles simple claims without a person and spots fraud. That frees staff for the customers who need empathy, and insurers that use what they learn about each customer to tailor their policies keep more of them.
Why is keeping customers so hard for insurers?
Insurance used to be personal: a customer confided in an agent when they needed to make a claim. Since the pandemic, and with the rise of digital services, the move from that kind of service to intelligent self-service has sped up. Customers no longer have hours to spend filing a claim, and expect it to be processed without an agent.
Falling customer satisfaction is insurers' biggest challenge, because it costs them customers. People simply switch providers when they face complex forms and long claims.
By 2022 the size of the insurance market had been static for several years, and customers were looking elsewhere for the best deals. A brand can grow only by taking market share from its competitors and keeping the customers it has. Insurtech companies have disrupted the traditional providers, and often offer cheaper products by using broader data sets and integrated technology to tailor them.
What frustrates insurance customers?
Customers come to an insurer when they have a problem, so they are often frustrated already, and life admin is hard to fit into a busy day. They want a quick answer that takes as little of their time and effort as possible, whether they are making a claim or looking for the best deal.
It is the customer who seeks out the insurer, not the other way round. So every touchpoint has to be easy, and has to make customers feel valued, with offers that take their circumstances into account.
What can self-service and AI do for customers?
With AI, customers can buy and renew policies, report a claim and check its status for themselves. Little human involvement is needed, so problems are solved sooner and customers are happier.
Chatbots and self-service portals are there whenever and wherever a customer needs them. Conversational AI can work out a customer's situation at the start of a conversation and anticipate what they need, so problems are resolved without being escalated.
For insurers, that could be Chat to Claim: an intelligent chatbot that renews or cancels a policy without an agent having to take the customer's details by hand. Customers can have claims approved immediately, and the chatbot talks to policyholders directly about their account. Insurers need fewer customer service agents, so their costs fall. Both sides gain.
What does AI do for insurers?
More accurate data. AI analyses large data sets to help insurers understand the individual and their claim. A person can take several minutes to analyse and cross-reference data; AI does it instantly and hands it back to them to decide. Better insight makes for more reliable products, with fewer problems when the customer claims or renews.
Less human error. Customers give insurers detailed information about themselves, which passes through underwriters and examiners. They often get it wrong without meaning to, which can delay a claim or distort the insurer's view of the risk. AI-assisted risk assessments and tailored plans reduce those errors, so customers buy the cover they need, and not more.
Fraud spotted sooner. AI can check that a claim fits the cover bought. If a driver claims for an accident in a work-only vehicle far from their place of work, AI can flag it for a person to review. If the data is all accurate, the driver completes the claim without a person, and sooner.
How is AI used in health, life and car insurance?
Health. Wearable devices give insurers a constant window into a user's health: how active they are, their heart rate, their location and more. In 2019 Apple and Aetna launched the Attain app, which used Apple Watch data to give an insight into its users' health, so Aetna could react quickly to concerns and give better guidance; Aetna closed it at the end of 2023. The health insurer Cigna uses AI to monitor health data and personalise treatment. With Prognos Health, it predicts whether an individual is at risk of a certain disease, and tells members about developments in their health: earlier intervention, and lower costs for members.
Life. For life insurance underwriting, AI can help deliver personalised pricing, disease severity prediction, prioritisation of submissions and quick product creation.
Car. Car insurers still spend hours processing documents by hand in slow legacy software, yet they have to consider every detail of a car, such as its safety technology: a premium cannot rest on the vehicle's size alone. Some car insurers use AI to gather data from dash cams, to assess damage and fault in collisions, and in 2022 Geico and Allstate were working on features that log data on customers' smartphones to encourage safe driving. Drivers are reluctant to take the black boxes that monitor their driving, even when it saves them money. The time since the last tyre or brake change, with the mileage the driver submits (or MOT data), would give insurers more to tailor cover with, and strengthen the driver's case if they claim.
Does engagement matter as much as price?
Keeping customers is the holy grail for insurers. Price comparison sites let people find the best deals for themselves, and price clearly drives their decisions, but engagement is starting to shape them too. The insurers that do well at renewal time focus on how they deal with customers, and keep looking for ways to add value to their policies through good service and care.
Research by Consumer Intelligence compared how two insurers performed on retention. It measured engagement by customers' views of the overall service, their belief in its customer service and care, and their satisfaction, and found that a higher engagement score goes with a higher retention rate.
Keeping customers also lowers the cost of winning them, which is high. So insurers have to balance engagement with competitive prices to keep as many as they can.
How do data and intelligent self-service keep customers?
Intelligent self-service uses customer data at every touchpoint to tailor policies and offers to each customer. When AI analysis of that data informs policies, underwriters have better access to the customer, and more customers stay.
Data and personalisation go together. The customer gets the product they want, agents spend less time finding the right one, and the insurer keeps more customers at a lower cost of acquisition.
Insurers have long been too focused on transactions, and that is changing. They are designing products and services around the customer's experience, and coming to be seen as trusted advisors, which builds loyalty. In a market this competitive, insurers need loyalty, trust and engagement, and to stay affordable.
What happens to the people?
As AI and intelligent self-service become common, companies need to rethink their employees' roles. Training staff to use AI tools creates opportunities for them and the company, and when AI handles the simple queries, agents can focus on relationships, loyalty and trust.
Most customers contact their insurer only when something has gone wrong or they need to claim, so they are likely to be frustrated already. Staff with time to respond with empathy can calm a problem down and turn the experience into a good one.
What is the engagement capacity gap?
It is the gap between what insurers know they must do to meet rising customer expectations and the budgets and people they have to do it, and after the pandemic, budgets were slashed.
Verint's research shows that understanding customers' needs is the biggest challenge companies face. Customers want efficient, empathetic service that solves their problem, and insurers putting AI in place are better able to meet new challenges such as supply chain issues and staff shortages.
Where is insurance heading?
Intelligent self-service is not a future idea: it is increasingly common in insurance and other industries. In 2022 many insurers had invested in AI only partly, most with simple triage chatbots, partly because of the money already sunk into legacy systems. Those that have introduced it are starting to see higher retention and better engagement scores, which makes them more profitable and competitive. How 4 Roads builds intelligent self-service.
Updated on 7 October 2026.
