Trust Gap Erased: Insurers Outpace Other Industries in AI Adoption and ROI

The insurance industry has emerged as the most strategically committed sector to artificial intelligence, yet a stark performance gap is widening between firms that prioritize governance and those chasing simple cost savings. For carriers and MGAs, the ability to demonstrate trustworthy AI is now directly correlated with achieving a positive return on investment.

What was announced

The findings, published in the second annual "Data and AI Impact Report: The New Economics of Trust" by SAS and IDC, are based on a comprehensive survey of 2,699 decision-makers across 28 countries. Conducted in April 2026, the research focused on high-stakes sectors including banking, insurance, life sciences, and the public sector. The report reveals that insurance is currently the only industry where perceived trust in AI has actually exceeded measured capability, albeit by a margin of less than 1%.

The data highlights a significant divide between AI "leaders"—those with robust governance and data quality practices—and "laggards." Among insurance AI leaders, 59% report strong or high ROI from their deployments. In contrast, 0% of insurance laggards reported a strong ROI signal, making insurance the only sector where laggards failed to produce any significant return. Currently, 54% of insurers have AI operational across multiple functions or scaled companywide, and 76% plan to increase their AI investment over the next year. Expectations remain high, with 84% of insurers anticipating a positive return and over 60% expecting an ROI of 50% or more.

However, trust remains a volatile factor. Across all industries surveyed, nearly 80% of organizations override more than 10% of decisions made by AI agents. The most common reason for these overrides, cited by 34.5% of respondents, was a lack of explanation for the AI's decision. More concerning for risk-averse insurers is that 8% of decisions were overridden because they were deemed "unsafe," while others were flagged for bias or factual incorrectness.

"Whenever I hear executives say they're investing in AI in order to reduce staff, it tells me that organization has no strategy. Because cutting costs is the least imaginative use for AI. Keep your people, teach them how to use the tools safely, and pursue goals like improved customer experience, expanded market share and stronger resiliency."

Franklin Manchester, Global Strategic Insurance Advisor at SAS.

The companies involved

SAS is a global leader in data and AI, providing analytics software and services designed to transform data into intelligence. The company has a deep presence in the insurance market, offering specialized tools for risk management, fraud detection, and actuarial analysis. Within the FF News network, SAS has been the subject of 10 previous reports, reflecting its central role in the ongoing dialogue regarding automated decisioning and enterprise governance. Franklin Manchester serves as the Global Insurance Strategic Advisor (Principal) at the firm.

IDC (International Data Corporation) is a premier global provider of market intelligence, advisory services, and events for the information technology and telecommunications industries. With 14 prior mentions in FF News coverage, IDC is a frequent contributor to industry research, particularly concerning digital transformation and enterprise AI strategy. Dr. Chris Marshall, who serves as VP for Enterprise AI Strategy at IDC, contributed to the report’s analysis, emphasizing that for the insurance sector, reliability and confidence must grow in tandem with deployment scales.

What FF News has reported before

FF News has closely followed the intersection of AI governance and business value. In October 2026, we reported on a related study in UK Leads Global AI Adoption but Struggles to Realise Business Value, SAS Report Finds. That earlier coverage noted that while adoption rates in certain regions were high, the actual payoff remained elusive for many organizations that lacked the necessary governance frameworks. This latest report builds on those findings by specifically identifying the insurance sector as the frontrunner in closing the "trust gap," suggesting that the industry's inherent focus on risk management may be giving it a competitive edge in AI implementation compared to other financial services.

What this means from an insurtech perspective

The revelation that 8% of AI-driven decisions are flagged as "unsafe" should be a wake-up call for every Chief Risk Officer in the industry. In a sector built on the precise calibration of risk, an 8% failure rate in automated decisioning is a massive liability that could lead to catastrophic loss ratios or regulatory intervention. This data puts immense pressure on incumbent technology vendors and insurtech startups to move beyond "black-box" models. For carriers and MGAs, the path to profitability is no longer about using AI to trim headcount; it is about using explainable AI to enhance underwriting precision and claims efficiency. Those who continue to view AI primarily as a cost-cutting tool are likely to find themselves among the "laggards" with zero ROI.