The 2026 edition of Gallagher Bassett's Carrier Perspective underscores a market defined by compounding pressures on underwriting discipline, claims severity and operational capacity. Based on input from 250 insurance leaders across North America, the United Kingdom and Australia, the report highlights how social inflation, litigation funding, medical cost growth and AI-enabled fraud are converging to reshape carrier strategy.
For claims adjusters, the findings confirm what many are already experiencing on the ground. North American carriers report that rising claim-related costs are hitting underwriting and pricing functions hardest at 74 percent, with 66 percent citing direct impact on claims handling and adjusting. Nearly two-thirds report increased claims complexity over the past year, particularly in general liability, property and auto liability. Large jury verdicts, prolonged litigation timelines and third-party litigation funding continue to inflate reserves and extend settlement cycles. These trends require more rigorous documentation, earlier risk assessment and tighter coordination between claims and legal teams.
Catastrophe exposure remains a destabilizing force. Preliminary insured catastrophe losses exceeded USD 100 billion globally for the sixth consecutive year, with wildfire events such as the Los Angeles County fires illustrating the scale of volatility carriers must absorb. For property and catastrophe adjusters, this environment reinforces the need for scalable surge capacity, disciplined reserving and closer alignment with state-backed catastrophe funds and federal disaster frameworks.
Medical inflation is another critical driver. More than half of North American carriers identify it as the leading contributor to rising claims costs, particularly in workers' compensation. With medical expenses accounting for over 60 percent of workers' compensation costs in the US, adjusters are managing longer treatment durations, comorbid conditions and higher wage replacement exposure. These trends are challenging traditional pricing assumptions and increasing scrutiny on provider networks and case management practices.
Technology is both a solution and a risk multiplier. Generative AI adoption in fraud detection has climbed to 67 percent in North America, a 16-point increase from 2025. At the same time, around half of North American carriers report a rise in fraudulent or suspicious claims linked to AI-generated documentation. Adjusters are now navigating increasingly sophisticated forged invoices, repair estimates and medical records. Carriers are responding with hybrid AI models, stronger encryption protocols and expanded validation teams to mitigate hallucinations, bias and data privacy risks.
Workforce strain compounds these challenges. Talent attraction and retention now ranks as the top global business challenge, with acute shortages in claims management, specialized case management and legal compliance roles. Hybrid work structures are becoming the preferred model, yet carriers acknowledge capability gaps that affect claim cycle times and oversight. For claims leaders, the emphasis is shifting toward structured training, mentorship and AI literacy to sustain technical expertise while integrating new digital tools.
Economic volatility and trade pressures add another layer of complexity. More than one-third of North American carriers report increased demand for liability coverage tied to tariffs and supply chain disruption, while nearly 60 percent have adjusted underwriting strategies to reflect trade-related exposure. Manufacturing, shipping and logistics are among the most affected sectors, driving changes in supply chain coverage pricing and documentation review requirements. Adjusters are seeing more intricate claims tied to rerouted cargo, contract disputes and inflation-driven repair costs.
Across all themes, the report points to a disciplined recalibration rather than reactive retrenchment. Carriers are investing in predictive analytics, refining underwriting criteria, advocating for tort reform and strengthening cybersecurity infrastructure. For claims professionals, the practical takeaway is clear: success in 2026 depends on early severity recognition, technology fluency, litigation awareness and coordinated risk management across underwriting, legal and operations.
The carrier perspective reflects an industry under sustained pressure but actively adapting. For adjusters, the operational reality is a more complex claim file, higher scrutiny on documentation and greater reliance on data-driven insight to protect both profitability and policyholder trust.
