Insurers need to invest in claims talent

Parima members and their peers worldwide will be frustrated to read the findings of a new global report that confirms what most instinctively know: underwriting take precedence to claims among insurance company leadership. As claims become ever more complex, particularly since the recent hard market when panels had to be expanded to complete programmes, risk managers in Asia and worldwide are finding claims more difficult. As found in our own Risk Frontiers Asia and Risk Frontiers Europe surveys, risk managers are becoming increasingly concerned about the commitment of the insurers to help tackle these complex claims and investment in talent at the ‘back-end’ of the company. The new report from the International Association of Claim Professionals (IACP) and London-based independent insurance research firm Gracechurch confirms this worrying perception. The 2024 IACP-Gracechurch Future of Claims Talent Report is based on 144 interviews with a cross-section of claims professionals from insurers, brokers and third-party providers across Asia Pacific, the US, the UK, Europe and Latin America. The survey team said that, despite the claims function becoming an increasingly vital differentiator in the insurance industry, the report findings show that while claims services are rising as a critical selling point for insurers, only a third of senior claims professionals feel their organisations are “fully committed” to investing in claims talent. This lack of confidence is compounded by the fact that many claims teams report existing skills gaps. With only a small proportion of professionals feeling “completely prepared” to meet client needs in the next two to three years, the shortfall is clear. A staggering nine in ten claims leaders say it is “essential” or “very important” for their teams to develop new skills in the immediate future. Succession planning and identifying new skills have emerged as key focus areas for future claims talent development. In particular, advancing technological expertise and honing leadership capabilities are seen as top priorities to remain competitive and meet the evolving demands of clients and regulators, concluded the report’s authors. Ben Bolton, managing director of Gracechurch, highlighted the urgency of the issue: “Research shows a consensus that claims service is becoming a competitive priority – customers, sales brokers, regulators, and now global claims professionals all speak as one. “Despite this, the report shows that organisations aren’t addressing this as a priority. Insufficient investment in the right areas is driving the emerging void, and the claims community is clear that organisations need to focus on new skills, technology, and talent development,” Bolton continued. “The industry faces a critical moment: will organisations heed the call to prioritise claims talent and maintain a competitive edge?” The report finds that, despite the growing recognition of claims as a critical part of the customer experience, underwriting is often perceived as more important than claims within many organisations. As one claims professional explained: “Underwriting is unfortunately still seen as more important. Even though brokers and clients speak highly of the claims teams, internally we still pay underwriters more, for instance.” This internal bias persists across many reinsurers where claims are still “not considered as important as underwriting” by higher management, the survey found. “One challenge is that senior executives typically focus on headline-grabbing or catastrophic claims, rather than the day-to-day claims handling, which is often seen as less impactful,” said the report’s authors. “This oversight contributes to the ongoing disparity in attention and investment between underwriting and claims within many companies,” they added. Commenting on the report, Paul Brand, CEO of London-based specialty insurer and reinsurer Convex, said: “I welcome this report from IACP and Gracechurch. The identified gaps in tech and soft skills in claims globally are concerning and should be a trigger for a debate on wider industry action.”

Insurers need to invest in claims talent

Survey finds CEOs focus on underwriting not claims

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