North American insurers are confronting a structural, not cyclical, shift in claims costs as social inflation, medical inflation, catastrophe losses, economic volatility and rapid AI adoption converge, according to Gallagher Bassett’s 2026 Carrier Perspective: Claims Insights report.

...Medical inflation remains the single biggest cost driver. Fifty‑six percent of North American carriers identified it as the key contributor to rising claims‑related costs. Drawing on Workers Compensation Research Institute data, the report notes that medical expenses now account for more than 60% of workers’ compensation costs in the US, with aging workers and increased attention to mental health adding to complexity and duration.

Read the full review from Insurance Business here.  The WCRI report that they cite is Compscope Medical Benchmarks, 2025 Edition.  See its page elsewhere on the website for links to the individual state reports, and information on how to obtain copies.