In conversations with claims leaders, these are the main trends reshaping how claims leaders operate.
1. Social Inflation
What is social inflation?
Social inflation refers to the increase in claim severity above what could be anticipated under the usual scope of economic inflation and claim trends. From 2015 to 2020, the median cost of a jury award over $10 million increased by 35%.
Four keys driving social inflation:
- Desensitization to Large Verdicts
Excessive awards are becoming less shocking due to highly publicized “nuclear verdicts” and social media amplification of negative corporate sentiment. - Negative Public Sentiment and Corporate Accountability
67% of jurors believe companies knowingly sacrifice safety for profit, while 89% think companies should exceed government safety standards. - Erosion of Tort Reform
Historically, the legal environment limited the amount plaintiffs could obtain in damages. This scale has now shifted in favor of the plaintiffs. Additionally, the elimination of monetary caps in some states have also led to increased judgments. - Sophisticated Attorney Tactics
Sophisticated plaintiff attorney tactics are driving inflated judgments through strategic marketing and psychological manipulation
Other Key Factors Driving Social Inflation
- Advertising: Attorneys are spending about $1 billion for 15 million advertisements per year in both digital and offline channels. In addition to bringing in more plaintiffs, these ads also have the potential to influence jury pools.
- Venue Shopping: Using analytics to determine the locations and judges with a track record favoring more generous awards.
- Repositioning Medical Results: Emphasizing results such as diagnostic imaging to focus on the worst-case scenario, often with the intent to demonstrate a need for additional procedures or even lifelong care.
How Canotera’s Predictions Counter These Tactics:
Our platform analyzes litigation patterns and predicts case outcomes before social inflation factors become unmanageable. By providing accurate and explained win/loss probabilities, damage estimates, and case duration forecasts, we help carriers make informed settlement decisions that avoid the costly impact of the rise of social inflation.
2. Plaintiff attorney dynamics are having a growing impact on outcomes
Beyond economic forces, the plaintiff bar continues to shape case outcomes in increasingly significant ways. Certain firms and individual attorneys are known to drive higher severity and extended timelines, often setting the narrative before the defense has fully assessed the facts. Their familiarity with specific jurisdictions, early framing of liability, and coordinated litigation strategies create leverage that can materially influence negotiations. As these patterns become more consistent, claims teams are paying closer attention to attorney identity as an early signal of how a case may evolve.
3. Cycle times remain elevated, especially for complex matters
Cycle times remain elevated across much of the industry. Even as courts stabilize, litigated claims often experience prolonged timelines due to delays in hearings, expanded discovery, and intentional stalling tactics from the plaintiff side. These extended durations tie up capital, inflate LAE, and reduce predictability for claims and finance teams alike. The persistence of longer cycle times continues to challenge planning, resource allocation, and early exposure evaluation.
4. Case complexity is increasing faster than staffing capacity
Claims professionals are also navigating rising case complexity. Modern claims frequently involve multiple parties, more extensive documentation, competing experts, and increasingly technical medical or operational narratives. Even routine matters can quickly develop into multifaceted cases requiring deeper investigation and closer collaboration with counsel. This growing complexity places additional strain on teams and underscores the need for clearer early indicators to guide decisions before cases escalate.
