Blog: Easing the burden of legacy claims

The disproportionate time and resource spent on legacy claims can put a squeeze on insurer profitability, says Gallagher Bassett’s Ashley Easen

For years, legacy claims have drained insurers’ financial reserves, taking up valuable resources in achieving a resolution. These claims are often complex, but no longer serve current business needs or contribute to overall growth.

Legacy claims are becoming a primary focus for insurers aiming to increase profitability and efficiency in a market dogged by long-tail exposures. Indeed, some 69% of UK insurers identified legacy claims as a key challenge, according to research results published in Gallagher Bassett’s annual whitepaper, The Carrier Perspective: 2025 Claims Insights.

One effective strategy to minimise the impact of legacy claims without dedicating further internal resources is outsourcing legacy portfolios to a strategic partner. Such partners provide specialist expertise, fit-for-purpose technology and flexible resourcing solutions.

Tech-enabled

Insurers are often locked into outdated, time-intensive claims management systems that are difficult to integrate with modern technology – essential for settling claims more efficiently. For insurers who lack the internal expertise to streamline the integration of claims with new systems, or the resources to upskill staff, outsourcing is one of the best options.

Modern claims technology solutions offer advantages in solving complex legacy claims, including access to advanced data analytics that can identify hidden patterns and emerging risks. This contributes to solving current problems and future-proofing the business against potential pitfalls.

Leveraging technology is also essential for informed decision-making and addressing unique problems. This is where the support of a partner like Gallagher Bassett can play a valuable role by providing access to innovative technology solutions alongside deep expertise to enhance the claims resolution process, and creating bespoke programmes that address the pain points caused by legacy claims.

When harnessed correctly, the right approach can transform a legacy portfolio from a financial burden to a competitive advantage.

Ashley Easen, Gallagher Bassett

Specialist resource

While technology has an important role to play in reducing the burden of legacy portfolios, human expertise is vital for understanding the intricacies and broader picture of complex claims.

With higher litigation costs, the rising influence of social inflation, ongoing talent shortages, and evolving regulatory environments, insurers already have their hands full managing present challenges. Meanwhile, legacy claims continue to place a continual cost-intensive strain on resources that could be better used elsewhere.

Outsourcing legacy portfolios to a reputable claims management partner allows insurers to free up capital and internal teams, enabling talent to focus on initiatives that drive growth.

Competitive advantage 

Leveraging partners with the resources and expertise to develop tailored solutions to complex long-tail claims is a cost-effective way to achieve greater flexibility and efficiency, while unlocking capital growth opportunities for new programme development, potential expansion and innovation.

Legacy claims present unique challenges, but they also offer valuable insights that can inform the development of new product lines and enhance existing ones.

While many legacy claims sit under abandoned portfolios due to lack of performance, engaging the right expertise can improve the financial performance of a loss portfolio, introduce fresh strategies for more effective claims management and provide access to additional support avenues, all while improving operational efficiency across your core business.

When harnessed correctly, the right approach can transform a legacy portfolio from a financial burden to a competitive advantage.

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