Using classic Outlook for Windows in business environments
I found this thread while searching for a solution to this extremely annoying behavior. I'm writing this from a burner account but I'm mainly writing because I have to deal with this on my work account.
With the old Outlook, you could double click on an .ics file and have the even pop up in your default calendar, automatically. With the new Outlook you need to follow the procedure as described by @Jayden-P . When you double click on an .ics file, the new Outlook will not show anything. You need to select the calendar tab, and only then you'll see the event import dialog. In it, you need to manually select the calendar you want to import the event into. And then you need to click on the Import button.
There are so many inefficient steps in this workflow compared to the old Outlook's behavior. For example, the new Outlook cannot even recognize that I have only one calendar, and I need to manually select it. My org blocks Feedback Hub so I don't know who to reach out to regarding this and similar issues, but if anyone from the development team is reading this - please can you fix it.