You may remember the days when claim reporting lag times, introduction of medical cost containment, and assessment of soft tissue injuries were common conversation drivers for claims professionals. Despite the host of new intricacies and nuances, the fundamental need to resolve an injury or loss as efficiently and effectively as possible hasn’t gone away; neither has the goal of restoring a sense of normalcy to a life or operation that was unexpectedly disrupted.

In case you missed the educational session at the 2022 RIMS Conference & Exhibition, here’s a recap of some of the challenges that drive today’s claims discussions and tomorrow’s decisions:

1. Data and information explosion

With improved intake and claims systems, more data and information are captured today than ever before. The challenge before many industry professionals is what data to collect, how to collect it, and how to assess and leverage the resulting information. This is where technology — along with machine learning and artificial intelligence — are making an undeniable imprint on the industry. Technology allows for the identification of defined patterns within data sets and puts more actionable information in the hands of claims professionals quickly. The result is that potentially severe or escalating claim situations can be addressed early in the most constructive manner possible — providing an improved outcome and experience by those impacted.

2. Nuclear verdicts and social inflation

Despite a concerted focus on safety in recent years, nuclear verdicts and social inflation are real concerns. Litigation costs continue to rise and there are more attorney-represented claims prior to first notice of injury. Moreover, media coverage and advertisements around windfall settlements are also likely adding to the hype. The reality is that there are indicators that can signal which claims are likely to escalate. And there are also strategies and measures that companies can put in place to help deter astronomical claim settlements. A well-defined legal philosophy based on advocacy and litigation avoidance measures, alongside a strong litigation plan for those that do go to trial are essential.

3. Expanding presumptions

From its earliest roots as an injury compensation system, workers’ compensation has evolved on a state-by-state basis. Disease has historically not been widely compensable without evidence-based demonstrations or legislative definitions. However, the nature of COVID-19 and its related challenges have led some states to react legislatively or regulatorily. In certain cases, states have even amended this social contract to shift virus costs to employers and insurance carriers retroactively. As legislators and politicians increasingly turn to the use and expansion of presumptions to extend automatic compensability to select workers who may have been exposed to disease, industry players are attempting to understand the costs and ramification on the workers’ compensation systems. It will be interesting to watch to see if this is a true shift representing a new era moving to a greater degree towards socialization of risk.

The content of this blog was originally discussed on Monday, April 11 at the 2022 RIMS Conference & Exhibition, alongside Walmart’s Michele Adams, vice president, risk management operations & casualty claims. Stay tuned for related blogs.