Why are some policyholders opting not to file claims?

And what would cause a major of policyholders to consider switching insurers?
Why are some policyholders opting not to file claims?
INSURANCE NEWS
By Josh Recamara
May 28, 2025

Insurity, a provider of cloud-based software for insurance carriers, brokers and managing general agents, has released the results of its 2025 Digital Experience Index, a national survey examining consumer perceptions of digital interactions with property and casualty insurers.

The survey found that 22% of respondents had opted not to file an insurance claim due to what they described as a frustrating or overly complex process. The findings point to a potential disconnect in the claims experience that may be affecting customer engagement and satisfaction.

In addition, 64% of participants said they would consider switching insurers for a more streamlined digital experience. The data suggests that difficulties during digital interactions, particularly in the claims process, can influence policyholder decisions and increase the likelihood of switching providers.

As digital platforms become a primary channel for customer service and support, the report underscored the role of claims processes in shaping consumer perceptions. While many insurers have invested in digital transformation, the findings suggest that technology alone may not be sufficient. The customer experience, especially at key points such as claims, appears to remain a critical factor in policyholder retention.

“As carriers evaluate their core systems and digital infrastructure this year, the priority must be reducing friction where it matters most,” said Sylvester Mathis, chief insurance and chief revenue officer at Insurity. “A clunky or disconnected claims process frustrates customers and risks sending them elsewhere. When someone avoids filing a claim, despite having coverage, it signals a fundamental breakdown in trust. If policyholders feel friction, uncertainty or inflexibility,, they’re less likely to file a claim, and far more likely to leave.”

The survey was conducted online in April 2025 and included responses from more than 1,000 adults across the U.S. The questionnaire consisted of 19 items, ranging from multiple-choice to scaled responses, designed to capture views on various aspects of digital engagement. The data was then analyzed to identify recurring themes and trends.

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