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Clients may turn to AI advisers when embarrassing details come up
Research from MIT Sloan suggests embarrassment can outweigh perceived competence, increasing the likelihood that people choose AI for advice even when humans are rated as more capable.
Insurance Journal highlights a new MIT Sloan study examining when clients prefer AI advisers over human advisers, focusing on a behavioral factor the outlet calls “embarrassment.” The research finds that people who feel ashamed about the details of their situation are more likely to choose AI, even if they consider a human alternative more competent.
According to the study, participants generally rated human advisers as more competent than AI advisers across several domains, including financial and technological scenarios. But when the topic became embarrassing enough, such as being caught overstating professional qualifications, or when AI was presented as sufficiently skilled, preferences shifted toward AI.
Insurance Journal reports that the paper, “AI Advisers and the Competence-Judgment Tradeoff in Information Disclosure,” was authored by Eric So of MIT Sloan, along with Abigail Sussman and Fiona Yang from the University of Chicago Booth School of Business. In one experiment, when participants were asked to disclose their own embarrassing financial or tech situation, researchers found people offered justifications more often to humans than to AI, with justifications appearing 33.0% of the time with human advisers versus 15.0% with AI.