What Chief Claims Officers Need to Plan for in 2027

Chief Claims Officers face pressure to control costs while improving service and claim outcomes. Meeting those expectations requires a clearer view of where to reduce spending and where greater investment may pay off.

Managing workforce capacity as AI expands, evaluating litigation spending against outcomes, and improving visibility into the expenses associated with individual claims are three interconnected priorities for the year ahead, according to carriers participating in Auriemma Roundtables’ Chief Claims Officer Roundtable.

Balancing Workforce Costs Amid the Rise of AI

CCOs are considering how AI can expand their teams’ capacity while managing costs.

“AI can give carriers more flexibility in how they allocate work,” says Ron Kifer, SVP, Insurance, at Auriemma Roundtables. “That could mean preparing employees for more complex responsibilities or using technology for work that currently requires an outside vendor. The value depends on how those changes improve the operation.”

That shift makes employee development part of the technology investment. As automation takes over routine tasks, carriers will need to prepare associates for more demanding work while preserving opportunities to develop claims judgment. Roundtable participants discussed structured mentoring, recorded claim reviews and peer case discussions as ways to support that progression, particularly across remote teams.

Meanwhile, claims teams must balance efficiency with preserving the customer experience. Frontline contact operations are expensive to scale, making them a natural area to consider for automation. But efficiency gains can lose value if customers struggle to get answers or reach an adjuster.

Kifer sees promise in AI’s ability to handle routine customer interactions, with successful implementation depending on how well automated services connect with human support. Customers must have a clear, easy path to an adjuster when they need one.

For 2027 planning, CCOs will need to evaluate those applications against service quality and claim outcomes as well as capacity. Integration with existing systems, clear oversight and the ability to explain AI-supported decisions will help determine whether a promising tool can support everyday claims operations.

Measuring Litigation Spending Against Claim Outcomes

Legal expense control is also receiving a reassessment: CCOs are looking more closely at the return on their investment in defense counsel, including whether greater spending early in a case can improve the eventual resolution, says Kifer.

For example, involving a partner more extensively may cost more upfront than assigning most of the work to junior or midlevel associates. That investment may be worthwhile if the partner’s experience supports a better case assessment, defense strategy or settlement. The decision depends on the matter and the value that additional expertise brings.

Meanwhile, outside defense firms and in-house legal teams alike face pressure to control costs while investing in technology and developing trial talent. Meanwhile, evolving plaintiff strategies, unpredictable jury behavior and third-party litigation funding make case evaluation more demanding.

“Carriers need to consider how their spending decisions affect the quality of the case,” says Kifer. “Experienced counsel can help identify critical issues earlier and assess opportunities for resolution. The top-line legal bill is only part of the picture. CCOs need to evaluate the bottom-line return, including whether spending more upfront can produce a more favorable settlement or reduce the total cost of resolving the claim.”

Closer coordination between claims teams and counsel remains central to the response. Early assessments, clear litigation plans and regular file reviews can help both teams revisit exposure and resolution options as a case develops. Comparing spending and outcomes across similar matters can also inform decisions about outside counsel, staff counsel and alternative fee arrangements. For CCOs, the question is how each approach supports the quality and timing of claim resolution.

Taking a Broader View of ALAE

That evaluation extends to allocated loss adjustment expenses (ALAE), the costs attributable to specific claims, including fees for outside attorneys, experts and investigators. Legal spending is one component of this broader expense picture.

For CCOs, the priority is understanding what drives those expenses. More complex claims may require additional expertise, while repeated reviews or overlapping assignments may point to process gaps. Comparing similar claims by expense category, complexity and resolution time can help distinguish necessary spending from avoidable duplication.

That visibility can strengthen vendor oversight. Clear scopes of work, complete information and defined responsibilities help outside specialists address the questions needed to move a claim toward resolution. Periodic reviews can also identify assignments that have stalled or no longer serve their original purpose.

AI and changes in staffing or vendor use add another consideration. Bringing services in-house or automating them may reduce outside fees, but the business case should also account for technology costs, employee workload and ongoing oversight. For 2027 planning, CCOs will need to assess whether those changes reduce the overall cost of handling claims while maintaining quality and customer service.

About the Chief Claims Officer Roundtable

CCOs benefit from knowing how other claims leaders are approaching the same tradeoffs. Auriemma Roundtables’ Chief Claims Officer Roundtable provides a forum to discuss implementation experiences and examine what peers are learning about workforce capacity, litigation outcomes and expense management.

Contact Ron Kifer for more details.