Forrester reports that insurance companies have invested heavily in the digital transformation of the claims process, introducing a range of self-service capabilities for initial loss observations, settlement and the payment process. Forrester reports that insurance companies have invested heavily in the digital transformation of the claims process, introducing a range of self-service capabilities for initial loss observations, settlement and the payment process. (Photo: Thapana_Studio/Adobe Stock)

Inflation will pose a lasting challenge to the insurance industry, and it is questionable whether insurers will be able to compensate for rising claims costs on the premium side. Insurers need to become more efficient, as automation is developing into one of the significant drivers of success.

The industry is facing a critical period that will have a lasting impact on many companies in the market. AM Best data shows that inflation has already affected the industry in 2021. Increasing losses in motor insurance, medical malpractice and general liability lines have driven the market to an underwriting loss, despite premiums increasing by 9%. In 2022, the situation became worse. The ongoing economic pressure will force insurers to improve their operational processes. Automation will play a central role in this.

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