Policyholder expectations have been changing more rapidly in recent years. The evolution of self-service capabilities across industries, combined with the rapid expansion of the availability of artificial intelligence, have changed the way consumers interact with businesses. And this is true of the insurance industry, as well. Read on to learn more about how AI is changing policyholder expectations faster than ever before, and how agents can keep up.
Rapidly Changing Policyholder Expectations
AI-enabled tools and processes have changed how policyholders view service and timelines. They expect to access their policy, make changes, and perform simple tasks at any time. Many consumers are using AI-powered tools to research, compare, summarize, and make decisions about everyday products and services.
This shift has created both opportunities and challenges for independent agents. Challenges include finding innovative ways to keep pace with rapidly changing expectations. The opportunities associated with greater AI adoption, however, are seemingly endless. By combining the speed and convenience of AI tools with the expertise, judgment, and human capabilities of independent agents, agents can create an efficient, sustainable customer experience.
According to the JD Power 2026 U.S. Auto Insurance Study, 32% of auto insurance shoppers used AI tools during their search for coverage. Interestingly, however, the same survey showed 33% of those AI users found the results unhelpful. The study found users most often used AI to ask questions, obtain quotes, compare policies, and assist with decision-making. Those consumers that used AI in their search are 1.3 times more likely to switch insurers compared with those who do not. This suggests AI tools may be filling a critical understanding gap as policyholders are using AI tools for research and to ask questions their agent or insurer has not addressed.
This growing utilization of AI changes the traditional dynamic between policyholders and agents. In the past, the agent was often the primary source of insurance information. Policyholders would naturally call their agent with coverage questions or premium concerns. Today, a policyholder may ask an AI for information before talking with their agent, which shifts the conversation to one where a policyholder already has some knowledge before meeting with their agent.
How Agents Can Respond Effectively to Changing Policyholder Expectations
Knowing that policyholder expectations will continue to evolve rapidly, following the changing nature of technology, agents can try these four steps to keep pace:
Be proactive. This advice is often repeated, but when it comes to changing technology being proactive is critical. A significant reason policyholders use AI is that they cannot otherwise find an answer to their question quickly. This creates an opportunity for agents to improve their communications and the accessibility of their website. Agents can proactively explain coverage changes, answer common questions, and discuss premiums before billing cycles. They can utilize technology to deliver faster communications while saving time for complex conversations. Agents cannot compete with AI on speed alone, but they can quantify quick answers with human skills like guidance, empathy, and creativity.
Focus on learned knowledge about policyholders. AI cannot replace the human factor in insurance. Agents have learned many helpful details about their policyholders that will continue to drive value, even as the usage of AI tools increase. For example, agents know when a policyholder’s children will get their driving permits or move away to college. They may hear about a homeowner’s desire to build a pool or buy a second vacation home or a business owner’s expansion plans through conversations with their policyholders. Agents can utilize these facts to have coverage conversations and review policies.
Reduce friction within processes. Policyholders will continue to use AI-enabled tools, but they may not be fully satisfied with the experience. The recent JD Power study showed only 58% of policyholders understand their auto coverage, down 4 percentage points from the 2025 survey. This gap in understanding can be filled by independent agents who can build on the information a policyholder learns from AI. Listening to the policyholder and learning where the knowledge gap arose can help agents provide the right details to reset any misunderstandings.
Provide context about AI recommendations. An AI tool may recommend an umbrella policy, endorsement, or larger deductible to a policyholder based on the limited information it gains from the policyholder. However, an agent can provide personalized guidance based on the full context of the policyholder’s situation, a strength agents can use when meeting with policyholders who have used AI tools for coverage recommendations. Simply having more information from AI does not lead to better insurance decisions. The details an agent has transforms information into advice.
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