Claims Leakage Cost

Claims leakage quietly erodes profitability more than almost any other operational issue in P&C insurance.

Leakage occurs when claims are settled for more than they should be — through overpayment, unnecessary coverage extensions, delayed closures, or insufficient subrogation pursuit. Individually, each instance looks small. Cumulatively, they reshape loss ratios.

The difficulty is measurement. Carriers that do not consistently audit closed claims have no baseline to improve from. Building that baseline requires claim system data that is clean, complete, and queryable.

Best-in-class claims operations are now using analytics dashboards that flag outlier settlements in near real time, enabling supervisors to intervene before checks are cut rather than after.

#ClaimsManagement #LossControl #PandCInsurance #ClaimsLeakage #InsuranceOperations