The Impact of Artificial Intelligence on Service Industries: Exploring Federal and State Regulations and Assessing Benefits and Concerns

As service industries increasingly integrate Artificial Intelligence (AI) initiatives, their significant impact on service operations and customer behavior is undeniable [1]. Nevertheless, it is crucial to recognize that prior literature may have been overly optimistic about AI implementation. There is a growing need to examine its potential benefits and concerns for consumers, businesses, and society at large [1].This research focuses on insurance companies as a business model and introduces three approaches to gain comprehensive insights into this evolving field, with a particular emphasis on the potential benefits that AI can bring to the industry. First, the study explores governmental policies and regulations related to AI in the insurance sector providing insights into the legal framework. Second, It delves into service interactions to understand how AI affects customer experiences in service delivery, analyzing 263 responses to gain insights into customer experience. Finally, the research explores risks associated with AI integration, including data privacy concerns and the potential for biased decision-making. By identifying key factors and research gaps within each category, the study aims to provide a holistic understanding of the potential adverse outcomes of AI-based services and offer valuable insights to scholars and practitioners ultimately fostering a more informed discourse on the integration of AI in service operations.