The landscape of major and complex loss (MCL) claims, both in Asia and globally, is shifting, shaped by an interplay of climate-driven natural catastrophes, complex infrastructure, and heightened expectations for swift business continuity. Contrary to strategies of the past, managing these claims effectively now requires a balance of advanced technology, human touch, and market adaptability. This has caused ripple effects across the insurance and reinsurance sectors. The growing scale of claims and the expectation for a timely resolution has resulted in the role of adjusters, insurers, and reinsurers evolving.

 

A defining trend in the MCL space is the increase in the number of claims arising from natural catastrophe events, where climate change has contributed to greater frequency and severity of such events. Recent storms, such as Typhoon Yagi, and flooding in various parts of Asia, illustrate the devastating impact of these events, which can potentially lead to billions in losses for businesses. Higher claim volumes and values are being seen, which naturally results in insurers having to respond swiftly. To manage this, insurers and adjusters must invest in robust catastrophe response plans that prioritise smoother, faster claims processing and better coordination among stakeholders. Such plans not only expedite the claims process but also assist in minimising the disruption to affected businesses and communities.

 

At the same time, claims are becoming more complex due to advances in technology and infrastructure.  Facilities such as data centres with Battery Energy Storage Systems, electric vehicle charging stations, and production plants that rely heavily on robotics and automation are now common across Asia and globally. These facilities at times could involve interconnected systems and specialised components which can prove challenging to assess when damage occurs. As such, cause and origin investigations and even damage assessment could potentially involve multidisciplinary experts and consultants. This increased complexity underscores the need for continuous education and skill development for adjusters. They must prioritise skills that suit specialised environments, leveraging tools such as AI for rapid information retrieval, while still exercising judgement and due diligence. The ability to ask the correct questions and gather pertinent information early in the claims process can prevent significant delays later on.

 

What’s more is that technology itself has become indispensable in modern claims handling. Digital systems have replaced physical files, creating efficiencies in documentation and tracking, while remote inspection tools have expanded, especially in the aftermath of COVID-19. Remote inspection technologies allow adjusters to assess damage remotely by using software that connects to a claimant’s mobile phone, guiding them to capture images and videos while taking measurements in real time. Drones are also being used more frequently to capture aerial imagery of large industrial sites, high-rise buildings, disaster-affected areas or where damage is widespread providing safe and detailed assessments that might otherwise be impossible to grasp from the human eye alone. Similarly, 3D camera technology enables virtual walkthroughs of damaged buildings, offering insurers a comprehensive view in situations where access of the entire premises may not be possible. These technologies have improved safety, speed, and efficiency in claims handling, but they are designed to supplement – not replace – traditional site visits. In-person inspections still play an essential role in building relationships, validating evidence, and offering reassurance to claimants.

 

Despite these advances, the human element remains the foundation upon which trust in the claims process is built. Empathy and clear communication are essential qualities that help adjusters guide insureds through what can often be a stressful and disruptive process after an event. Natural disasters and other events can be traumatic experiences, and claimants look for not only financial resolution but also emotional support and reassurance. Early engagement of all stakeholders, including insureds, brokers, and insurers, is critical to align on mitigation strategies, reinstatement plans, and timelines. Transparent communication builds trust, ensures accountability and helps prevent disputes that might delay reinstatement. 

 

The reinsurance market has felt the impact of the rise in MCL claims. Higher reinsurance rates, stricter capacity deployment, and increased reliance on layered structures all reflect a more cautious approach towards risk appetite. Reinsurers are also encouraging stronger risk management measures from cedents, which ultimately cascade down to insureds. For example, insureds may now face stricter requirements and regulations around disaster preparedness, maintenance protocols, and reporting. While these measures increase the demands placed on businesses, they also encourage more resilient operations, reducing the overall impact of catastrophic losses. For reinsurers, these shifts are necessary to manage exposure in an era defined by climate volatility and technological complexity.

 

Timely reinstatement is another critical aspect of MCL claims, particularly in mitigating business interruption (BI) losses. When a manufacturing plant, data centre or other critical facility is impacted by an event, losses can escalate to hundreds of thousands of dollars per day. Effective claims management therefore hinges on establishing clear plans with milestones from the outset. Regular monitoring and communication ensure progress is being made, while collaborative input from all stakeholders allows for tailored solutions that reflect the unique aspects of each claim. Speed of reinstatement not only mitigates the business interruption losses but also helps businesses recover their market position and retain customer trust.

 

Ultimately, the evolving realities of MCL claims reflect a broader transformation in the insurance industry. The combination of advanced technology, specialised expertise, and human connection is redefining how claims are managed and resolved. For insurers, the challenge lies in balancing fair settlements with swiftness; for reinsurers, it is about recalibrating risk appetite while supporting sustainable market practices. Together, these forces are shaping a new era of claims management – one where collaboration and trust are as important as policy knowledge and technical competence.

 

By combining forward planning, technological innovation, and the enduring importance of human connection, the insurance and reinsurance industries can navigate the growing complexities of major and complex claims while maintaining stability and confidence across the global risk landscape. As climate risks escalate and infrastructure becomes more advanced, this balanced approach is and will remain essential for ensuring that claims handling continues to deliver not only financial restitution but also reassurance and resilience for the future. A 

 

Navin Vasan is a senior major and complex loss adjuster at Sedgwick.