When a customer lodges a claim after a house fire, waits three days for an adjuster's callback, and then navigates a PDF form designed circa 2003, they are not comparing their experience to the last time they dealt with a rival insurer. They are comparing it to the last time they returned a package to Amazon - which took four clicks and was resolved before they finished their coffee.
This is the Amazon Effect, and it has well and truly arrived in insurance.
The Earnix Insurance 2026: The Race to Reinvent report, drawn from a survey of 400 global insurance executives, captures the urgency of this shift with striking clarity. Twenty per cent of executives now identify digital engagement as the single most important consumer behaviour change reshaping their business. Four in five believe they are keeping pace with self-service and speed expectations. Yet only one in four can actually deliver personalised experiences at scale. The gap between self-assessment and operational reality could not be more telling.
For most of insurance's modern history, the competitive frame was simple: be cheaper, faster, or more trustworthy than the carrier across the street. That calculation has fundamentally changed.
Policyholders today are calibrated by daily interactions with platforms that know their preferences, anticipate their needs, and resolve issues before they are even articulated. Netflix recommends before you search. Uber confirms your ride in seconds and texts you when the driver is two minutes away. Spotify builds you a playlist you did not know you wanted.
Against this backdrop, an insurer that cannot provide a real-time policy update via a mobile app, or that routes a simple endorsement change through three departments over a week, does not simply look slow. It looks broken.
As Insurance Business explored in its coverage of evolving customer experience trends, organisations are under pressure to provide "personalised and contextually aware experiences" as a baseline, not a differentiator. The word "baseline" is doing significant work here. It means failure to meet this standard is no longer a competitive disadvantage — it is a reason to churn.
The reason so few insurers can close the gap is not a failure of intention. It is a failure of architecture.
Legacy core systems - built for the batch-processing realities of another era - were never designed to power real-time, omnichannel, individualised engagement. They produce what one industry analyst described bluntly as "fragmented customer journeys that fail to deliver cohesive experiences." Customer data sits in silos. Policy history lives in one system; claims in another; communications in a third. No single view of the customer exists, and without it, meaningful personalisation is structurally impossible.
The Earnix report is unambiguous on this point: legacy infrastructure is now more of a barrier to progress than ever. It slows underwriting changes, introduces inefficiencies, and limits the ability to respond with urgency to changing expectations. Modern, flexible platforms, by contrast, enable faster adoption of generative and agentic AI - the very tools that power the Amazon-style experiences policyholders now expect.
The industry's own executives acknowledge the urgency. As Insurance Business reported in its coverage of broker transformation trends, a senior Gallagher executive warned that the next three years will determine which firms shape the future of insurance and which are left behind. "Legacy systems, siloed data, and reactive operations are no longer sustainable," that executive noted. The firms gaining ground are those building modern data architectures and adopting AI-powered decisioning to redefine customer experience.
One nuance often lost in the "digital transformation" conversation is that customers do not want to eliminate human contact - they want human contact on their terms.
Research from Insurity's 2025 Digital Experience Index, covered by Insurance Business, found that 48 per cent of consumers favour a digital-first approach that includes the option to engage with a human representative when needed. Meanwhile, 64 per cent said they would consider switching insurers for an improved digital experience. The message is not "replace agents with bots." It is "give customers seamless digital access, and reserve humans for the moments that matter."
This is the operating model of the world's most admired consumer brands. Apple's genius bar does not try to handle every interaction in person; it uses technology to filter and triage, preserving human attention for complex problems and high-stakes moments. Insurance carriers that understand this distinction - and build accordingly - will retain customers that others are haemorrhaging.
Insurance brokers are coming to grips with this multi-sided challenge.
One task for brokers, said Kate Greaves (pictured right), managing director of Goldsworthy General Insurance Services, is educating clients so they understand that insurance is not like buying something from Amazon. Greaves said a property’s hail damage claim simply can’t be resolved and fixed in several days.
“There might be components of that claim where time can be cut down through AI,” said Greaves. “But whether people like it or not, there's still going to be a human element in all of that and a human element means time.”
Another Amazon Effect aims directly at the traditional broking business model. So brokers need to choose the right types of clients because thanks to the AI that has enabled the Amazon Effect many traditional broking and transactional operations can now be done by anyone from home.
“It's really making sure that you are very clear on who your ideal client is and why they actually need you,” said Greaves.
There is that other seemingly contradictory force at work too. Lisa Carter (pictured left), CEO of Clear Insurance, said she is noticing a parallel demand for more personal, human service.
“I think a lot of clients are now wanting more personal advice and they're wanting to have conversations,” said Carter. “So whilst they want that instant gratification, they still want to make sure that they have someone that they can talk to and obtain advice.”
Carter said this can be a productive pairing, but she was forthright about the serious challenges facing the broking profession from “digital transformation.”
“I think there’s potentially a good balance between technology and human interaction, and that's why advisors of the future are going to be risk advisors,” she said. “Insurance brokers will cease to exist, we won't be broking anymore, we'll be advising.”
Greaves said the future of broking can be a frightening thought for many industry colleagues.
“There's still a fear there,” she said. “But I often say, at the end of the day when someone's house or business is burning down, an AI bot is never going to be able to put its arm around them and go, 'It's okay, we're going to work through this together.'"
The Earnix survey surfaces a telling paradox at the heart of the sector's digital ambitions. Eighty-one per cent of respondents say AI is already integrated into workflows across most or some functions. Yet fewer than a third of insurers use AI for claims processing. Fewer than one in five use it for policy issuance. Only 15 per cent deploy it for predicting customer churn.
If AI is "integrated," but not deployed in the very functions that define customer experience, something is amiss. The integration appears to be happening in back-office and analytical functions — important, but invisible to the policyholder. The experience layer, which is what shapes the benchmark comparison with Amazon, remains largely unimproved.
The Forrester Insurance Predictions 2026 report adds a sharper edge to this: after the premium shocks of 2023–24, customer trust in carriers took a measurable hit. Rebuilding it requires not just competitive pricing but a demonstrable commitment to fast, fair, and deeply personal interactions. Insurers that lag will not simply lose a few customers; they will cede the very policyholders — younger, digitally native, higher lifetime value — who define the next decade of premium volume.
Closing the Amazon gap is not a technology project. It is a strategic repositioning — one that demands leadership commitment, not just IT investment.
The insurers making real progress share three characteristics. First, they have invested in modern core platforms that create a unified, real-time view of the customer. Second, they have redesigned processes around the customer journey, not around internal departmental structures. Third, they treat digital experience as a revenue lever, not a cost centre — understanding that, as external research cited in the Earnix report shows, digital leaders in insurance can reduce operational costs by up to 30 per cent while simultaneously improving satisfaction.
The Amazon Effect is not a trend that will peak and recede. The expectations it has set are permanent. Every year, the consumer's reference point improves as the world's best platforms become faster, smarter, and more anticipatory. Insurers have no choice but to move in that direction — the only question is whether they lead the transition or are dragged into it.
This article draws on the Earnix Insurance 2026: The Race to Reinvent report, based on a survey of 400 global insurance executives conducted by Market Strategy Group in late 2025.
