Two-thirds (66%) of 18–24-year-olds would be willing to pay more for an insurance policy if it guaranteed greater human involvement in claims handling, the most of all age groups, according to new research from KPMG UK1. The survey of 2000 UK adults found that over half (55%) of 25–44-year-olds would also pay more for greater human input, while those over 65 were the least keen, with just 31% willing to do so. In contrast, just over a third (36%) of UK consumers would accept a fully automated claims process in return for lower premiums.
Despite rapid advances in automation across the insurance sector, and rising sales in online only products, the research shows that human interaction remains central to trust in the claims process. Across all age groups, 90% say human interaction is important when it comes to claims handling and almost two thirds (64%) believe claims need to be primarily handed by humans.
Beyond preference, concerns about fully automated decision‑making remain widespread. Lack of human involvement was the biggest concern about the use of AI in the claims process, significantly higher than concerns about the use or security of personal data. More than half of UK consumers (55%) say they are not confident that automated claims handling would produce fair and accurate outcomes, while almost two‑thirds (65%) have ethical concerns about the use of AI in claims decisions.
Confidence in technology‑only outcomes is particularly low. Just 5% say they are ‘very confident’ that technology alone would deliver a fair and accurate settlement. This is far lower than the trust levels seen in AI in other areas, in a separate KPMG study which asked UK consumers about their general views on AI, unrelated to insurance or financial services, 42% said they’re willing to trust AI.2
Huw Evans, Partner and Head of Insurance at KPMG in the UK, said:
“Insurers know that customers value the human touch but may be surprised that digital natives say they are the most willing to pay for it. This may partly be explained by younger customers wanting to ensure their Motor and Travel policies work well for their needs and less experience of purchasing Insurance and making claims".
Matthew Smith, Partner and KPMG Global Claims lead said "Automating parts of the claims process can offer significant value for customers allowing for quicker settlement of claims and less expensive policies overall. Technology, applied with thoughtful design, has been critical to helping bring down the cost of young driver insurance and helping make it easier for customers to buy Insurance cover.
"However, this research is a reminder that at stressful points of claim, customers want to have clarity and visibility and to be reassured about how their claim is being handled. The best-in-class systems will maximise the value of digitisation to speed up claims and make progress visible while ensuring customers can always engage in the way they need".
