Expanding data volumes from sensors and other connected technology, intensifying regulation, increasingly volatile weather patterns — these are among the powerful forces reshaping the insurance industry.

Their effect on the claims function certainly will be profound. Nearly every link in the claims process will evolve in the future thanks to:

• Technological innovations (such as robotic process automation and driverless cars).
• Significant shifts in claims volumes (less, but more unpredictable, claims).
• Changing customer expectations (more digital engagement).

There's little doubt that tomorrow's claims organization will look and act differently. Smaller, leaner teams will rely on greater automation to focus on higher-value activities. Robust digital channels will handle most low-complexity claims (especially in personal lines).

New tools and technology

New tools and technology will take over activities currently performed by loss adjusters, eliminating the need for in-person property or vehicle damage inspections, for example. Proactive loss prevention, especially in the areas of fraud, data breaches and cybersecurity, will be a top priority.

Analytical thinking and complex adjusting skills will be at a premium as data volumes and complexity increase dramatically thanks to:

• The Internet of Things, including factory and home sensors and telematics systems on cars and trucks.
• Social media data that provides real-time information about claims severity and localization and helps prevent fraud.
• Drones used to remotely inspect damage and collect data for underwriting purposes.

It's possible that retail and personal insurers will reduce their employee base by up to 50 percent, with commercial specialty insurers seeing smaller reductions. Remote working and new sourcing arrangements across complex claims supply chains will reduce real estate costs. Special response units and global catastrophe teams will manage surges and spikes in claims volumes due to increasingly frequent weather events and natural disasters.