Making AI Work in Insurance: Overcoming Cultural Barriers for Scalable Adoption
Artificial Intelligence (AI) is no longer a futuristic concept for the insurance industry—it’s a strategic priority. Yet despite growing investment and enthusiasm, adoption at scale continues to lag. A 2025 report by Yooz highlights the challenge: 1 in 7 employees refuse to use new workplace tools, while 39% remain reluctant adopters. More than half (51%) believe technology rollouts disrupt operations rather than improve them.
Gallup’s 2024 study echoes this resistance, revealing that nearly 70% of employees never use AI tools, and only 10% engage with them weekly. While two-thirds believe AI will positively impact their work, only a third report that their organizations have begun integrating AI into daily processes.
In insurance, this tension is even sharper. According to the State of AI Adoption in Insurance 2025 survey by Roots, over 90% of insurers are exploring or piloting AI, and 82% of executives see it as a top strategic priority. Yet just 22% have successfully deployed AI into production. The gap between enthusiasm and execution is clear: the technology works, but the culture resists.
Why AI Adoption Stalls in Insurance
Insurance companies are eager to innovate, but cultural friction often derails well-intentioned AI initiatives. The problem isn’t just technical—it’s behavioral. Here’s why adoption struggles:
1. Legacy Systems
Many insurers still rely on decades-old infrastructure. When AI tools must operate alongside rigid back-end platforms, integration becomes patchy, creating duplicate workflows and user fatigue.
2. Regulatory Scrutiny
Insurance is highly compliance-driven. Every decision must be explainable and traceable. If AI systems generate “black-box” outputs, employees revert to manual processes to avoid compliance risks.
3. Tacit Expertise
Underwriters, adjusters, and actuarial professionals bring years of domain expertise. When AI tools overlook this knowledge or feel dismissive of experience, adoption falters.
4. Risk-Averse Culture
Insurance thrives on caution. While this mindset ensures accuracy in risk assessments, it slows experimentation with AI-driven workflows. Change imposed without collaboration only heightens resistance.
These aren’t irrational barriers—they’re rational responses to tools that feel imposed rather than integrated.
The Hidden Costs of Poor AI Adoption
When AI fails to gain traction, the losses aren’t always dramatic but are deeply corrosive over time:
- Wasted investments in licenses, platforms, and pilots that never scale.
- Hybrid inefficiencies, where employees juggle old and new workflows.
- Frustrated teams who view AI as disruptive rather than helpful.
- Eroding trust between leadership and front line staff, leading to disengagement.
- Stalled innovation, as cultural resistance slows transformation initiatives.
This resistance compounds into a cycle where every future rollout is met with skepticism, making recovery harder than any technical upgrade.
Building Cultural Alignment: Making AI Stick in Insurance
AI adoption in insurance won’t succeed through technology alone. It requires trust, inclusion, and cultural alignment. For sustainable impact, insurance leaders must design adoption strategies with people at the center.
Key Levers That Drive AI Adoption:
- Start Small, Scale Smart
Introduce AI in low-resistance areas such as customer on-boarding, document summarization, and sales assistance. These early wins build trust before moving into core workflows like underwriting and claims. - AI as a Collaborator, Not a Controller
Tools should assist rather than override. For example, intelligent recommendations can guide underwriters and sales agents without replacing their judgment. - Transparency and Explainability
Employees are more likely to embrace AI when its logic is clear and decisions can be justified. Explainable AI reduces fear of “black-box” decisions. - Respect for Human Expertise
AI should enhance, not diminish, the judgment of experienced professionals. Co-creating workflows ensures tools align with real-world practices. - Leadership-Driven Change Management
AI adoption is as much about people as it is about technology. Engaging employees early, addressing fears, and offering targeted training fosters confidence.
The Future: AI Embedded in Insurance Culture
The future of AI in insurance depends on cultural integration as much as technological advancement. When teams feel empowered and included, AI becomes a trusted partner rather than a forced mandate.
By prioritizing alignment over acceleration, insurers can transform AI from pilot programs into scalable solutions. The long-term vision isn’t about replacing expertise but amplifying it—creating a future where AI enhances judgment, streamlines workflows, and builds trust across the value chain.
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