There’s a story most of us know about insurance and technology. It goes something like this: a new technology trend emerges—telematics, blockchain, cloud computing, big data, embedded insurance—fill in the blank. The insurance industry latches on. Hype ensues. For a conference cycle or two, this is all we hear about.
Big investments follow, multi-year transformation efforts get underway… and yet, years later, nothing has fundamentally changed. Insurance is still as complex as ever, if not more so. Legacy systems handicap modern UX efforts, multiple data sources compete instead of connect, and layers upon layers of infrastructure weigh down any real progress. Meanwhile, insurance products remain largely the same. While some customer experiences marginally improve—just enough to start to feel modern (great, I can pay my premium online now!)—others deteriorate (what ever happened to customer service?).
And the industry moves on, chasing the next big idea.
Will AI be any different?
The answer to that question, of course, is: it depends. It depends on a lot of factors, not the least of which is the industry’s motives for AI adoption. Will insurers approach AI transformation as they have past transformations—through a purely utilitarian lens, focused on operational efficiencies, cost cutting, and risk reduction? Or will it surprise us all and take a more human-centered approach to AI?
We hope to be surprised.
Can AI usher in a new golden age for insurance?
In our latest report, A New Golden Age for Insurance, the team at Cake & Arrow explores what the future of insurance might look like if the industry pursued AI through a human-centered lens—motivated not just by what AI can do for the business, but by what it can do for policyholders, employees, and everyone within the insurance ecosystem.
As customer experience designers, we’re privy to a not-so-secret secret: what’s good for policyholders, employees, and people is also good business.
We ask: Can AI usher in a new golden age for insurance? One where policies are easy to understand, affordable, and tailored to customer needs? Where employees are fulfilled and empowered, with the resources to excel and flourish? Where businesses are unburdened by legacy technology, gaining streamlined access to data that helps them efficiently write and sell relevant policies? And where all of society—not just the privileged few—can access the protection and financial stability they need to thrive?
The opportunity is clear: AI can help insurance become not just smarter or faster or more profitable, but also more human. Who wouldn’t want to sign onto that?
Four takeaways from our research
Over the past two decades, we’ve worked with dozens of top carriers, brokerages, and startups and engaged with thousands of policyholders, agents, brokers, and employees to understand the real barriers holding the industry back—and the real opportunities that lie ahead. Through this lens, we’ve identified four takeaways for how AI, if used thoughtfully, could help insurance evolve toward a more human-centered future:
1. AI’s current trajectory in insurance is too efficiency-led—focused on speed, automation, and cost-cutting.
This approach can erode trust if not implemented with care. Take customer experiences: AI promises faster claims processing and streamlined communication. But without attention to nuance, it risks making already impersonal experiences even colder.
Our research shows that while customers value speed, they also crave clarity, empathy, and understanding—none of which can be automated without intention.
2. Human-centered AI offers a new paradigm.
AI that serves the human—not the system—by simplifying complex decisions, improving clarity, and supporting equitable outcomes.
From simplifying policy language to anticipating customer needs and reducing decision fatigue, AI can lift the burden of complexity. With the right guardrails, AI can tailor experiences to individual needs while preserving transparency and agency, making customers feel informed and empowered, not confused and manipulated.
3. There’s a business case for empathy.
Insurers that prioritize fairness, transparency, and customer empowerment will be better positioned to differentiate and grow.
On the employee side, burnout and turnover are endemic—especially in claims and customer service roles. AI can help redistribute work more equitably, anticipate workload surges, and create more sustainable staffing models. Done right, this not only improves employee experience—it results in better, faster, and more compassionate service for customers, too.
4. Trust is the real innovation frontier.
In a world of skepticism and low institutional trust, AI can help insurance companies rebuild their relationships with customers and employees alike.
Whether through transparent pricing, more personalized policies, or better internal support for brokers and underwriters, AI has the potential to bridge trust gaps. But only if it’s deployed with humility, transparency, and a clear understanding of what people actually need—not just what the business wants to optimize.
A human-centered path toward a new golden age
The insurance industry stands at a critical crossroads. AI has the potential to do what past technologies could not: transform insurance into a system that works better for everyone. But to get there, insurers must shift their focus—away from efficiency and cost-cutting alone, and toward people.
The opportunity is real. AI can help insurers meet the demands of a changing world while delivering experiences that build trust, confidence, and connection.
The choice now lies with the industry: Will it use AI to perpetuate the status quo—or will it seize this moment to usher in a new golden age, one where technology serves people?
The future of insurance is waiting.
The question is, will we rise to meet it?
For a deeper exploration of these ideas—and actionable strategies for achieving a more human-centered future—download our full report, A New Golden Age for Insurance.
report
With AI advancing at an accelerated pace, the insurance industry stands at a critical crossroads. Rising customer expectations and demand for seamless digital experiences mean insurers must rethink their approach to technology. How can the industry avoid past tech missteps and harness AI to create more intuitive, compassionate, and genuinely humane experiences?
Together, we can reimagine the role of technology in insurance—not as a replacement for the human experience, but as a way to elevate it.
