Barbara S.
Guest
Sep 24, 2025
10:01 PM
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About six months ago, a long-time client—let’s call her Jessica—walked into her local insurance branch, smartphone in hand and documents ready. She had already started updating her home insurance policy online but got stuck midway. Her expectation? A seamless experience where her digital efforts picked up right where she left off—in person.
But that didn’t happen. The systems weren’t connected, forcing Jessica to repeat steps and re-explain her needs. The insurer, despite investing in digital tools, still operated in silos. And unfortunately, this scenario isn’t rare—it’s the new normal in an industry struggling to bridge the gap between online convenience and real-world service.
This highlights a bigger issue: the conversation around traditional vs digital insurance is outdated. In 2025, the real challenge isn’t choosing between the two—it’s blending them.
Customers Don’t Think in Channels—They Think in Outcomes
For most Americans today, insurance isn’t about paper forms or mobile apps—it’s about solving a problem quickly, easily, and confidently. The days of choosing between a physical office or a website are gone. According to GITNER’s 2025 consumer trends report, over 60% of policyholders prefer digital channels for managing policies, but nearly 70% still want expert advice when things get complicated.
In other words, traditional vs digital insurance is no longer an either/or proposition. Customers want both. They want to start a claim from their phone while waiting for coffee—and then talk to a knowledgeable agent later without having to explain everything from scratch.
They don’t see “channels.” They see your brand—as one seamless experience. And if your systems aren’t connected, or your staff can’t transition between touchpoints effortlessly, it erodes trust. Worse, it makes even simple interactions feel like a chore.
Silos Are the New Silent Killer
The insurance industry has invested heavily in digital transformation since the pandemic. In fact, 85% of U.S. insurers say they’ve accelerated digital capabilities. But only 43% have actually integrated these tools across their business. That’s a big problem.
Disconnected systems mean customer data doesn’t flow. That leads to frustration on both ends—clients get annoyed, and agents lose time trying to patch together a customer’s history. The impact on retention is tangible. Integrated insurers report an average 81% customer retention rate, compared to 64% for those still stuck in legacy silos, according to a 2025 Forrester study.
And it gets worse. A regional carrier in the Midwest launched a sleek mobile app for filing claims. But they didn’t connect it to their call center software. So when clients called for updates, the agents were blind. In just three months, their Net Promoter Score (NPS) dropped 11 points. One in five customers said they’d consider switching providers.
It wasn’t a tech failure—it was a strategy failure.
Rethinking the Real Question: From Either-Or to "And"
It’s time to retire the outdated mindset of traditional vs digital insurance. The most successful insurers are those who see digital and traditional not as opposing models, but as complementary pieces of a unified experience.
So, what does this look like in action?
Shared Data Ecosystems: Whether a customer calls, clicks, or walks in, agents should see the same real-time information.
Digital-First, Human-Backed Journeys: Let customers initiate online—but offer a knowledgeable human when they need reassurance.
Feedback Loops Across Touchpoints: Insights from in-person visits should inform digital strategies, and vice versa.
In 2025, convenience and human connection aren’t trade-offs. They’re table stakes.
Final Thought
The future isn’t about choosing between traditional vs digital insurance. It’s about recognizing that customers demand both. Winning insurers will be those who connect dots, not just build tools. Because for someone like Jessica, it’s not about channels—it’s about feeling understood and supported, from start to finish.
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