Social Inflation: What Does It Mean?

Social inflation, also commonly referred to as “nuclear verdicts” or “runaway verdicts,” is significantly disrupting malpractice insurance premium renewals, risk management and the insurance industry overall. There is a systematic change in the way that liability cases are tried, compounded with a shift in societal view of claims.

Are you seeing an uptick in year-end insurance budgets and upcoming renewals? Do you understand why this happening? Are you looking for mitigation tactics and ways to differentiate your program? An understanding of social inflation will be critical in the daily tasks of risk managers, claims teams, brokers, attorneys, and insurance/finance professionals.

Richard Frese, FCAS, MAAA, a Principal and Consulting Actuary in the Chicago office of Milliman, examines this latest trend in his most recent article with visual metrics in an easy-to-read discussion. Learn about the causes of social inflation, insurance coverages most affected, the impact on the insurance industry’s profitability, difficulties in forecasting insurance losses, and most importantly 10 mitigation tactics to combat social inflation. How do these tactics compare to your strategy?

Richard’s full article with detail can be accessed and read at https://www.milliman.com/en/insight/Assessing-social-inflations-disruption-to-data-metrics-and-forecasts-10-mitigation-strategies