Aon Re: The future of claims is not claims

Bobby Fischer once looked at elite chess and decided the game was heading in the wrong direction.

For all his later, well-known controversies off the board, he is still one of the greatest players ever to sit at it. He saw opening theory becoming industrialised memorisation.

Routine was replacing creativity. So he changed the rules, inventing Chess960, where every match began from a different starting position and players had to think again.

Claims now faces a similar choice: protect today’s work or create tomorrow’s value.

The current claims operating model is terminal

For decades, we’ve treated the claims operating model as a machine to be optimised.

We industrialised processes, drove standardisation, introduced workflow tools and chased efficiency.

That work mattered. It delivered scale and consistency. But technology is now consuming the very activities we spent years perfecting.

As technology commoditises administration, the traditional claims operating model is terminal. It was built for a world where value came from handling volume at the lowest possible cost.

In an AI-enabled world, that is table stakes – and increasingly cheaper to buy than to build.

McKinsey estimates that nearly 50% of manual activities in insurance could disappear through AI alone, delivering a 40–50% productivity impact on individual processes.¹

The implication is not that claims disappears. It is that an operating model built around people processing information becomes harder to defend.

As routine work is automated, value migrates towards judgement, advocacy and complex problem-solving.

We spent decades making the machine more efficient. Now we must build something new.

Claims has never been more important – but its assets are underused

This is not a threat to claims. Claims has never been more strategically important.

Claims is where risk becomes real. Every major claim is a bundle of operational, financial and behavioural insight: which controls broke, where wordings creaked, how clients responded under stress, how recovery paths played out.

As a result, claims teams sit on the most valuable assets in insurance: experience, expertise and data.

Yet in most organisations those assets are consumed by the terminal operating model. They run today’s processes instead of building tomorrow’s services.

Some carriers are starting to break that pattern. In 2025, AXA XL published an analysis of more than 300 cyber claims from its global portfolio, examining the causes, severity and characteristics of major losses.

The insurer says it uses insight from those claims to improve underwriting practices, develop new products, adjust risk-pricing strategies and enhance risk-management solutions.²

Experience from one generation of losses is being fed directly into how the next generation of risk is priced, covered and managed.

A similar feedback loop is visible in Allianz Commercial’s work on business-interruption (BI) risk.

The insurer analysed 7,888 BI claims worth approximately €6.74bn and found fire and explosion alone accounted for more than 40% of total claims value.

One anonymised case involved relatively limited fire damage at a small manufacturing unit but produced a nine-figure, group-wide BI loss because of its impact on downstream operations.³

These examples point to a broader opportunity. Claims functions sit on a constantly renewing dataset of how risk behaves in the real world.

When that experience is converted into insight, it can shape decisions long before the next claim occurs – from how risk is priced and covered to how it is prevented and managed.

Why we aren’t moving faster

If the logic is so clear, why is change so slow? In short, because we are trapped supporting yesterday’s model.

The bulk of budget, talent and technology is tied up in keeping the current machine running, even as its sources of value erode.

The issue is not just legacy technology, but the resources needed to sustain it.

West Monroe research into the US insurance sector found that 54% of insurers allocate more than half of their IT budgets to maintaining existing systems.

Nearly half still operate core platforms ten years old.⁴

Insurers are effectively funding yesterday and tomorrow at the same time.

Claims teams are asked to innovate while hitting tighter cost and productivity targets.

Technology budgets go on replacing or patching core systems rather than redesigning how claims, underwriting and capital decisions interact.

Organisational structures and incentives still treat claims primarily as a back-office cost centre, not as a source of growth or differentiation.

This is why the problem is systemic, not tactical. It is not solved by a single analytics project or a new dashboard.

It requires leaders to accept that the current claims operating model has reached the end of its strategic life – and to reallocate attention and investment accordingly.

Less processing, more value – a claims intelligence roadmap

So what does a different model look like? A useful way to think about this is as a progression from Today to Next to Tomorrow.

Today: make the existing promise work better.

Many organisations are already creating value through stronger advocacy, smarter analytics and more proactive recovery. Here we see claims teams:

• Navigating complex coverage issues and negotiations to secure better outcomes for clients.

• Using claims analytics to identify trends in risk, loss causes and portfolios.

• Focusing on recoveries, commutations and leakage to improve financial performance.

Next: use claims to prevent loss and inform risk decisions.

The step change comes when claims stops being only about past events and begins to shape future ones:

• Loss-prevention services built on proven claims patterns.

• Claims-informed underwriting, where experience feeds into risk selection, pricing and attachment decisions.

• Balance sheet solutions that use claims insight to reduce volatility and improve capital efficiency.

Some firms are already moving this way.

Zurich Resilience Solutions, for example, uses claims and risk-engineering insight to help clients strengthen prevention and operational resilience.

Meanwhile, Swiss Re’s risk-engineering and analytics teams use loss data and scenario modelling to focus clients’ risk-management efforts on the exposures most likely to drive future losses.

In both cases, claims experience is no longer the end of the story; it is an input into how risk is managed before the next loss occurs.

Tomorrow: build a true claims intelligence layer.

Ultimately, the opportunity is to combine human judgement, data and AI into decision services across the value chain, such as:

• Decision-intelligence services that help carriers and clients test scenarios before they happen.

• Outcome-focused services that proactively influence claim trajectories rather than reacting to them.

• Digital “risk twins” that use claims, exposure and operational data to explore how portfolios might behave under different stresses.

Building these services from claims intelligence is a priority for us at Aon.

For example, we are using claims payment-performance analytics drawn from a global database of how reinsurers pay across territories, lines of business and causes of loss.

That insight is now feeding directly into broking allocation decisions to better match cedants’ requirements, and into proactive engagement with markets where performance gaps emerge.

In one recent case, working jointly with a cedant and a global reinsurer on catastrophe losses in Scandinavia, we were able to identify and address specific information and timing issues in the process – contributing to a 55% improvement in payment performance in 2026.

Stop protecting today’s work, start creating tomorrow’s value

Most claims executives recognise that the current model is terminal, and as an industry we are not moving fast enough.

Automation will hollow out today’s processes; the only real choice is whether we let that happen to us, or use it to free up resources for claims intelligence and new services.

For brokers, insurers and reinsurers, the question is stark: keep protecting today’s work, or start creating tomorrow’s value – knowing that whoever builds serious claims intelligence first will set the terms for everyone else.

¹ McKinsey & Company, “Shiny objects: Insurance productivity in an era of AI and automation,” McKinsey on Insurance, 15 August 2024.

² AXA XL, Large cyber claims unveiled: a focused study on trends, threats, and tailored solutions, September 2025; AXA XL, “Large loss claims account for 88% of all its global cyber losses,” 9 September 2025.

³ Allianz Commercial, Business interruption claims: Trends and developments in corporate insurance losses, October 2026.

⁴ West Monroe, insurance technology modernisation research, reported in Insurance Business, “Legacy systems, budget constraints stall insurance modernization – West Monroe,” 20 October 2025