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US liability claims face mounting pressure from social inflation: Swiss Re

October 2, 2023

The United States insurance industry is grappling with a persistent wave of social inflation, with liability claims costs surging by an annual average of 16% over the last five years, according to Swiss Re Institute.

This trend far outpaces the average rates of economic inflation, which have hovered around 4%. As the economy shifts towards disinflation, the spotlight is now firmly on liability lines, where wages, healthcare expenditures, and social inflation are key drivers of claims severity.

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