All posts by Jeff Dunsavage

Auto Insurance, Business Insurance, Catastrophes, Homeowners Insurance, Insurers and the Economy, Market Conditions, Wildfire

Despite Progress, California Insurance Market Faces Headwinds

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Even as California moves to address regulatory obstacles to fair, actuarially sound insurance underwriting and pricing, the state’s risk profile continues to evolve in ways that impede progress, according to the most recent Triple-I Issues Brief.

Like many states, California has suffered greatly from climate-related natural catastrophe losses. Like some disaster-prone states, it also has experienced a decline in insurers’ appetite for covering its property/casualty risks.

But much of California’s problem is driven by regulators’ application of Proposition 103 – a decades-old measure that constrains insurers’ ability to profitably write business in the state. As applied, Proposition 103 has:

  • Kept insurers from pricing catastrophe risk prospectively using models, requiring them to price based on historical data alone;
  • Barred insurers from incorporating reinsurance costs into pricing; and
  • Allowed consumer advocacy groups to intervene in the rate-approval process, making it hard for insurers to respond quickly to changing market conditions and driving up administration costs.

As insurers have adjusted their risk appetite to reflect these constraints, more property owners have been pushed into the California FAIR plan – the state’s property insurer of last resort.  As of December 2024, the FAIR plan’s exposure was $529 billion – a 15 percent increase since September 2024 (the prior fiscal year end) and a 217 percent increase since fiscal year end 2021. In 2025, that exposure will increase further as FAIR begins offering higher commercial coverage for larger homeowners, condominium associations, homebuilders and other businesses.

Insurance Commissioner Ricardo Lara has implemented a Sustainable Insurance Strategy to alleviate these pressures. The strategy has generated positive impacts, but it continues to meet resistance from legislators and consumer groups. And, regardless of what regulators or legislators do, California homeowners’ insurance premiums will need to rise.

The Triple-I brief points out that – despite the Golden State’s many challenges – its homeowners actually enjoy below-average home and auto insurance rates as a percentage of median income. Insurance availability ultimately depends on insurers being able to charge rates that adequately reflect the full impact of increasing climate risk in the state. In a disaster-prone state like California, these artificially low premium rates are not sustainable.

“Higher rates and reduced regulatory restrictions will allow more carriers to expand their underwriting appetite, relieving the availability crisis and reliance on the FAIR plan,” said Triple-I Chief Insurance Officer Dale Porfilio.

With events like January’s devastating fires, frequent “atmospheric rivers” that bring floods and mudslides, and the ever-present threat of earthquakes – alongside the many more mundane perils California shares with its 49 sister states – premium rates that adequately reflect the full impact of these risks are essential to continued availability of private insurance.

Learn More:

California Insurance Market at a Critical Juncture

California Finalizes Updated Modeling Rules, Clarifies Applicability Beyond Wildfire

How Proposition 103 Worsens Risk Crisis in California

Insurers and the Economy, Legal Environment, Market Conditions, Regulation, Risk Management

Claims Volume Up 36%
in 2024; Climate, Costs, Litigation Drive Trend

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By Lewis Nibbelin, Contributing Writer, Triple-I

U.S. property claims volume rose 36 percent in 2024, propelled by a 113 percent increase in catastrophe claims, according to a recent Verisk Analytics report.

While evolving climate risks fueled claim frequency, uncertain inflation trends and unchecked legal system abuse will likely further strain insurer costs and time to settle these claims, posing risks to coverage affordability and availability.

Abnormally active Atlantic hurricane season

In a “dramatic shift” from previous loss patterns, late-season hurricane activity – rather than winter storms – dictated fourth-quarter claims operations last year, Verisk reported. Hurricane-related claims comprised nearly 9 percent of total claims volume, at a staggering 1,100 percent increase from the third quarter of 2023. Flood and wind claims both also jumped by 200 percent in volume.

“This shift in risk patterns demands new approaches to risk assessment and resource planning, particularly in the Southeast, where costs increased at six times the national rate following hurricane activity,” Verisk stated. Notably, Hurricane Milton generated roughly 187,000 claims totaling $2.68 billion in replacement costs across the Southeast, with 8 percent of claims still outstanding as of the report’s release.

Another above-average hurricane season is projected for 2025 in the Atlantic basin, according to a forecast by Colorado State University’s (CSU) Department of Atmospheric Science. Led by CSU senior research scientist and Triple-I non-resident scholar Phil Klotzbach, the CSU research team forecasts 17 named storms, including nine hurricanes – four of them “major” – during  the 2025 season, which begins June 1 and continues through Nov. 30. A typical Atlantic season has 14 named storms, seven hurricanes, three of them major. Major hurricanes are defined as those with wind speeds reaching Category 3, 4, or 5 on the Saffir-Simpson Hurricane Wind Scale.

Water, hail, and wind events in the Great Plains and Pacific Northwest also contributed to unexpected claim volumes, Verisk added. In contrast, wind-related claims fell in the Northeast compared to the fourth quarter of 2023.

Such regional variations highlight “the importance of granular, location-specific analysis for accurate risk assessment,” Verisk stated.

Contributing economic factors

Labor and material costs continued to rise year over year, with commercial reconstruction costs seeing a more pronounced increase of 5.5 percent compared to residential’s 4.5 percent, Verisk reported. The firm projected moderate reconstruction cost increases within both sectors during the first half of 2025.

Looming U.S. tariffs, however, may complicate this trajectory. Inflationary pressures related to the Trump Administration’s tariffs could further disrupt supply chains still recovering from natural catastrophes and the COVID-19 pandemic. Any such disruptions would compound replacement costs for U.S. auto and homeowners insurers as material costs – such as lumber, a major import from Canada – become even more expensive.

Excessive litigation trends

Similarly, excessive claims litigation – which prolongs claims disputes while driving up claim costs – plagues several of the states Verisk identified as experiencing increased claim volumes. For instance, though hurricane activity helps explain higher claim frequency in Georgia, the Peach State also is home to a personal auto claim litigation rate more than twice that of the median state, with a relative bodily injury claim frequency 60 percent higher than the U.S. average.

Verisk’s preliminary Q4 data reveals a 7 percent decrease in average claims severity compared to the same period in 2023 – a figure the firm expects to rise as more complex claims reach completion. But costly and protracted claims litigation, paired with ongoing tariff uncertainty, could magnify this figure even beyond their projections.

Undoubtedly, both will challenge insurers’ capacity to reliably predict loss trends and set fair and accurate premium rates for the foreseeable future, underscoring Verisk’s point that “staying ahead of these evolving patterns is essential in building more resilient operations in the future.”

Learn More:

Tenfold Frequency Rise for Coastal Flooding Projected by 2050

How Tariffs Affect P&C Insurance Prospects

What Florida’s Misguided Investigation Means for Georgia Tort Reform

Florida Bills Would Reverse Progress on Costly Legal System Abuse

Florida Reforms Bear Fruit as Premium Rates Stabilize 

Georgia Targets Legal System Abuse

Severe Convective Storm Risks Reshape U.S. Property Insurance Market

New Triple-I Issue Brief Puts the Spotlight on Georgia’s Insurance Affordability Crisis

P/C Replacement Costs Seen Outpacing CPI in 2025

California Insurance Market at a Critical Juncture

Florida’s Progress in Legal Reform: A Model for 2025

Louisiana Reforms: Progress, But More Is Needed to Stem Legal System Abuse

Data Fuels the Assault on Climate-Related Risk

California Finalizes Updated Modeling Rules, Clarifies Applicability Beyond Wildfire

U.S. Consumers See Link Between Attorney Involvement in Claims and Higher Auto Insurance Costs

Auto Insurance, Insurers and the Economy, Legal Environment, Market Conditions

Even With Recent Rises, Auto Insurance Is More Affordable Than During Most of Century to Date

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You read that right. As a percentage of median household income, personal auto insurance premiums nationally were more affordable in 2022 (the most recent data available) than they have been since the beginning of this century.

And even the premium increases of the past two years are only expected to bring affordability back into the 2000 range, according to the Insurance Research Council (IRC).

A new IRC report – Auto Insurance Affordability: Countrywide Trends and State Comparisons – looks at the average auto insurance expenditure as a percent of median income. The measure ranges from a low of 0.93 percent in North Dakota (the most affordable state for auto insurance) to a high of 2.67 percent in Louisiana (the least affordable).

The pain is real

This is not to downplay the pain being experienced by consumers – particularly those in areas where premium rates have been rising while household income has been flat to lower.  It’s just to provide perspective as to the diverse factors that come into play when discussing insurance affordability.

Between 2000 and 2022, median household income grew somewhat faster than auto insurance expenditures, causing the affordability index to decline from 1.64 percent in 2000 to 1.51 percent in 2022. In other words, auto insurance was somewhat more affordable in 2022 than in 2000.

“With the recent increases in insurance costs, affordability is projected to deteriorate in 2023 and 2024,” said Dale Porfilio, FCAS, MAAA, president of the IRC and chief insurance officer at Triple-I. “The affordability index is projected to increase to approximately 1.6 percent in 2023 and 1.7 percent in 2024, a significant increase from the low in 2021 but still below the peak of 1.9 percent in 2003.”

In other words, we’ve been here before; and, if risks and costs can be contained, so can premium growth in the long term.

Cost factors vary by state

Auto insurance affordability is largely determined by the key underlying cost drivers in each state. They include:

  • Accident frequency
  • Repair costs
  • Claim severity
  • Tendency to file injury claims
  • Injury claim severity
  • Expense index
  • Uninsured and underinsured motorists
  • Claim litigation.

These factors vary widely by state, and the IRC report looks at the profiles of each state to arrive at its affordability index.

Reducing risk and costs is key

Porfilio noted that “while state-level data cannot directly address affordability issues among traditionally underserved populations, collaborative efforts to reduce these key cost drivers can improve affordability for all consumers.”

Continued replacement-cost inflation is likely to maintain upward pressure on premium rates. Tariffs could exacerbate that trend, as well as hurting household income in areas dependent on industries likely to be affected by them.

At the same time, some states are working hard to ameliorate other factors hurting affordability.  Florida, for example, was the second least affordable state for auto insurance in 2022; however, the state has made recent progress to reduce legal system abuse, a major contributor to claims costs in the Sunshine State. In 2022 and 2023, Florida passed several key reforms that have led to significant decreases in lawsuits. As a result, insurers have been writing more business in the state after a multi-year exodus. This increased competition puts downward pressure on rates, which should be reflected in the IRC’s next affordability study.

Learn More:

IRC Report: Personal Auto Insurance State Regulation Systems

IRC Report: U.S. Consumers See Link Between Attorney Involvement in Claims and Higher Auto Insurance Costs

Florida Reforms Bear Fruit as Premium Rates Stabilize 

What Florida’s Misguided Investigation Means for Georgia Tort Reform

Florida Bills Would Reverse Progress on Costly Legal System Abuse

Inflation Continues to Drive Up Consumers’ Insurance Costs

Improved Commercial Auto Underwriting Profitability Expected After Years of Struggle

Louisiana Is Least Affordable State for Personal Auto Coverage Across the South and U.S.

Georgia Is Among the Least Affordable States for Auto Insurance

Report: No-Fault Reforms Improved Michigan’s Personal Auto Insurance Affordability

Auto Insurers’ Performance Improves, But Don’t Expect Rates to Flatten Soon

Cyber Risk, Technology

Personal Cyber Risk Is Up; Why Isn’t Adoption of Personal Cyber Coverage?

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By Mary Sams, Senior Research Analyst, Triple-I

Personal cyber risk – historically viewed as synonymous with “identity theft” – has evolved with the rise of internet-connected devices in the home. These devices can open the door to malware that can seize control of a homeowner’s data and expose them to extortion and other threats. Phishing and financial scams have been found to generate the greatest losses for homeowners.

Insurance for these perils exists, but adoption has not grown in line with the increasing peril. Triple-I and Hartford Steam Boiler (HSB) recently conducted research to better understand why and what insurers can do about it. The survey found that personal cyber insurance – while presenting a sales opportunity – involves educational challenges for agents and consumers.

Triple-I surveyed retail agents of homeowners insurance, since personal cyber coverage is commonly sold as an endorsement to homeowners’ policies. These agents are very knowledgeable of homeowners’ risks that can result in physical damage to property, as well as theft and liability coverages.

 “Agents see the storm,” said Neil Rekhi, product manager for personal cyber insurance at HSB, “but homeowners can’t envision the damage until it’s too late.”

 While 84 percent of agents surveyed said they recognize the value of personal cyber insurance, the survey found a notable gap between agents who feel comfortable selling it and those who don’t.

 This hesitation is mirrored by consumer skepticism. The study found that 56 percent of agents report their customers either don’t understand or don’t agree with the value proposition of personal cyber insurance products.

 “There’s a significant disconnect between agent perceptions of customer needs and actual customer perceptions of product value,” noted Dale Porfilio, Chief Insurance Officer at Triple-I.

Sales efforts remain robust, with 77 percent of agents having presented personal cyber insurance options to homeowners in the past month. However, consumer adoption rates continue to lag, highlighting a fundamental communication breakdown.

Closing the personal cyber protection gap will require a three-pronged approach: consumer education, agent/broker training, and a data-driven approach to product development,” says Triple-I CEO Sean Kevelighan.

Learn More:

FBI: Elder Fraud Up; Bolsters Case for Personal Cyber Insurance

U.S. Cyber Claims Surge While Global Rates Decline: Chubb

Digital Payment Growth Faces Rising Cybersecurity Threats: Chubb

Cyber Insurance Market Continues Rapid Growth as Risk Management Strategies Improve

Digital Tools Help Agency Revenues, But Cybercrime Concerns May Hamper Adoption

Careers and Employment, Workers Compensation

NCCI’s Tracy Ryan:
Busting the Math Myth

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By Loretta L. Worters, Vice President, Media Relations, Triple-I

 Growing up, Tracy Ryan always loved math. It came to her naturally. She liked the patterns, structures, and precision of math – “the poetry of logical ideas” as Albert Einstein put it. When she went to college, and then onto graduate school, her focus was on pursuing a career that aligned with her favorite subject. 

“Back then, 35 years ago, I thought the best career for a math major would be education,” said Ryan, who in November 2024 became president and CEO of NCCI – the nation’s most comprehensive source for workers compensation data, insights, and solutions. “But my grad school professors encouraged me to get into the actuarial field, and that led me to pursue an insurance career.”

Ryan never thought about the demands of working in a male-dominated industry. When she applied for her first position in an actuarial department, almost all the people who interviewed her were women.  

“When I joined the company, my first manager was a woman, and her manager was a woman,” she said. “So early on, I just had these incredible female role models who told me to keep my head down, focus on getting the work done, and learn from it, which was what I did. Through the actual program rotations, I got exposure to so many other aspects of the company.” 

These mentors encouraged Ryan to pursue distinct roles and opportunities as they presented themselves.

“The mentors and managers I had along the way played this fundamental role in helping me navigate my career and seek roles that were outside my comfort zone,” Ryan explained.  

Changing perceptions

The idea that women aren’t strong in math is a myth that persists in many industries, including insurance. But Ryan has worked hard to change this perception. 

“It’s important that early on in a child’s education that they are exposed to female role models and to opportunities that will help them see their connection to math,” she said. “Math was always fun to me, particularly because the teachers made it exciting and helped dispel the myth that women aren’t good at it.” 

Ryan mentioned that at NCCI, there are two programs to ensure young women are exposed to and excited by math and STEM more broadly.

“The first is a math mentors’ program, where our employees tutor elementary school students and help support their growth in math,” she said. “We also have a Women in STEM program called WINS. It’s an informative and engaging view of the technology field for middle and high school girls. By having this exposure and these role models, these young women will feel more connected and excited about pursuing a career in mathematics.” 

Only about 22 percent – less than one in four – C-suite leaders are women, yet Ryan has held several C-suite positions at major organizations across the insurance industry. She attributes her success to the experiences she’s had that shaped her into the leader she is today.  

NCCI celebrated “Women’s History Month” with an “Accelerate Action” event, featuring a women’s panel of speakers and networking event, including NCCI guests Donna Glenn, Edwiygh Franck, Tracy Ryan, and Nicone Gordon.

“With every leadership role that I’ve had, I’ve gained new perspectives and learned a lot about what it is to be a leader in this industry. I’ve realized that I don’t have to copy someone else’s model of what a leader looks like or acts like. I’ve built the confidence to lead with my own voice and my own genuine approach to the roles I’ve had.” 

Ryan said her leadership style is grounded in trust, authenticity, and collaboration.

“I firmly believe effective leadership starts by fostering a culture where all voices in the organization are heard and valued,” she said. “Leadership is all about people, and that’s a tremendous responsibility that we have as leaders. Because of that, I look to create environments where the growth and well-being of the team are prioritized and where I show up every day for those people and the industry that I serve.” 

Ryan said being authentic is important – for men and women – yet many struggle with that. 

“You think to do that role you have to do it exactly like the person who held the position before you, especially if that person was successful,” she said. “But realizing and trusting that you can bring your own unique perspectives and leadership style to the table is incredibly important. I’ve always had this idea that you should be the leader you always wish you had…. I tell people who are early in their career, ‘If you don’t see it, be it.’”  

Ryan said there is a lot to be excited about with advances in data analytics and AI, but she believes relationships based on trust and collaboration will continue to be the foundation of success in the insurance industry.

 “When we have those elements, we can create environments where creativity and innovation thrive, where new ideas are welcome,” she said. “Those environments create opportunities for everyone to rise and succeed. 

“The P&C insurance industry is so integral to maintaining economic resilience, improving safety, and more broadly supporting society,” Ryan added. “What we do is incredibly important and meaningful work. On top of that, we get to meet so many interesting people from various backgrounds and get to learn about the companies and industries we insure. We also get to build long-lasting and rewarding friendships with colleagues and have fun along the way.” 

Careers and Employment

From Start-Up to Industry Leader: Casey Kempton’s Trailblazing Career

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By Michaela Platt, Communications Coordinator, Triple-I

As businesses started incorporating Internet strategies and operations, Casey Kempton had just begun her graduate studies in cognitive anthropology and was working for a tech startup. A Connecticut native, Kempton had always been aware of insurance giants based in her state.

So, when the startup she worked for went out of business, a career with their insurance pilot customer, The Hartford, seemed a natural fit. She applied for a position in their e-business ventures unit and has worked in roles across the insurance industry ever since.

“When I first came into the industry and began learning about exactly what our product does and how it benefits consumers, I had this sense that both agents and consumers could expect more from their carriers,” said Kempton, who is now president of personal lines at Nationwide.

To Kempton, this meant thinking about preventing or minimizing claims, in addition to optimizing the end-to-end experience with the product. The curiosity and drive for innovation that marked Kempton’s early career propelled her to patent two home insurance risk rating solutions.

“A small group of us wanted to take the concept of early auto telematics and apply it to property, anticipating a future where the internet was pervasive and everything was connected,” Kempton said. “We explored how this could impact real-time rating, monitoring, and response for homeowners.”

Kempton leads all aspects of the business, including product, underwriting, sales and distribution, claims and services. She previously was executive vice president and digital business officer at Chubb and spent time with ACE Group, accountable for global personal and commercial lines and leading operations and information technology for Latin America.

The result was an invention Kempton helped create while still in her early twenties: a closed-loop system that senses, underwrites, and prices property risk in real time while also offering remediation services. The system has now been patented for nearly 20 years.

Despite this promising start, Kempton faced obstacles in this traditionally male-dominated field. Even as she rose into leadership roles, some challenges persisted.

“There are times where I may have traveled to visit agents or partners in different parts of the country and realized that expectations on the roles that women could hold versus men were quite different,” she said. “I had several experiences where it was assumed I was the note-taker for the meeting when, in fact, I was the boss or the most senior person there.”

Despite the challenges, Kempton has found her career as a woman in leadership to be incredibly rewarding and is thankful for the mentorship and sponsorship along the way.

“I had two really important mentor-sponsors in my career, both of whom were men, both of whom created opportunities for me that, on my own, I might have struggled to have,” she said.

Kempton has worked to form alliances and a support structure with both men and women in the industry. She has also found herself in stages of her career where she was without a mentor and had to network and build new relationships. She emphasizes the importance of leaning into common ground and building bonds with coworkers while also establishing practices that amplify all voices at the table.

“If you contribute something and then one of your male counterparts takes credit for it five minutes later, nobody says anything,” she said. “Everybody heard you and they know you said it, but we don’t have a practice of saying, ‘Right, that’s the idea Casey just shared. Thank you for pointing that out.’”

Kempton said a lot of bright, capable, driven women assert themselves – only to be  labeled “difficult”, “aggressive”, and “hard to work with”. That is something she has coached a lot of women on through her career.

Kempton also addressed the pay gap and the unspoken drawbacks women can face for taking time off to have children.

“I still have these stress dreams,” she said. “I know I’m stressed about something when I have this dream, and it’s that I’m pregnant again. And my goodness, what is that going to do to the rest of my career? How am I going to manage that? To me, this correlates to the pay challenge because my career paused with the birth of each of my children.”

Kempton is passionate about addressing the pay gap in the insurance industry, but recognizes that there is no easy answer.

“Each manager must make a personal commitment to say, ‘I can’t tell them how their pay may compare to others, but I can work to address it over time,’” she said. “We can work to fix it every year until men and women are on par. We can create awareness with managers that they have some control over how we address that pay gap.”

Meanwhile, women executives like Casey Kempton continue to break barriers. Her journey highlights the power of innovation, perseverance, and the importance of mentorship and allyship. From her early days at The Hartford to her leadership role at Nationwide, Kempton’s story is a testament to the impact one person can have.

“For me, leadership has been incredibly rewarding,” said Kempton. “The best advice I can give to young women starting out is to be curious. Expose yourself early on to as much as you can contextually and then become an expert in something. Being more intentional about how you navigate where you want to go, that’s when you’ll go far.”

Auto Insurance, Business Risk, Homeowners Insurance, Insurers and the Economy

How Tariffs Affect
P&C Insurance Prospects

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Tariffs and threats of tariffs have been roiling financial markets since January. Property and casualty insurers are no less concerned, as the cost of repairing and replacing damaged property is a driver of claim costs and, ultimately, policyholder premiums.

Triple-I Chief Economist and Data Scientist Dr. Michel Léonard recently sat down to explain the implications of tariffs and trade barriers for insurers and what economic considerations concern industry decisionmakers.

While property and casualty insurers write many kinds of coverage, the lines Léonard primarily discussed were homeowners and personal and commercial auto – “lines that have a physical emphasis on repair, rebuild, and replace.”

Lumber from Canada; cars, trucks, and parts from Canada and Mexico; and garments, furnishings, and technology from Asia all come into play when considering the prospective impacts of tariffs on replacement costs, Léonard said.

“When we’re focusing specifically on China,” he said, “we’re looking primarily at farm equipment and alternative-energy components.”

Uncertainty around tariffs – particularly in recent weeks, as tariffs on Mexico and Canada have been imposed and “paused” – makes analysis even more difficult.

“Much depends on how much clarity there is, how much communication from the policymakers, from the administration and from the legislature,” Léonard said. It’s also important to remember that impacts can last well beyond their implementation and withdrawal.

During the first Trump Administration, tariffs on soft commodities, beef, grain, and so forth had impacts for several years afterwards.

“Those tariffs were fairly short lived,” Léonard said, “but for two to three years afterward farmers were uncomfortable investing in equipment at the same pace, and that reduced farmowners’ insurance growth.”

Regardless of how the current discussions around tariffs play out, the Trump Administration has signaled a decided shift in policy toward greater protectionism. As a result, Léonard said, “We should expect a repositioning in our understanding of our replacement costs and underlying growth forecast for the next 12 months, at a minimum.”

He projects a period of “most likely 24 to 36 months” in which growth will be slower and inflation – including replacement costs for the P&C industry – will be higher.

Learn More:

Tariffs and Insurance – full video (Members Only)

Insurance Economic Outlook (Members Only)

Legal Environment

Florida Bills Would Reverse Progress on Costly Legal System Abuse

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Recent improvement in Florida’s insurance market – fostered by legislation targeting legal system abuse – is threatened by several bills proposed in the state’s 2025 legislative session.

Florida’s property insurance market has stabilized thanks to reforms introduced in 2022 and 2023 aimed at reducing excessive litigation and inflated claims. As a result of these reforms, the number of insurers writing business in the state has rebounded after a multi-year exodus. This competition has allowed policyholders to leave Citizens Property Insurance Corp. – the state-run insurer of last resort – to obtain coverage at rates that were previously unavailable.

According to the Florida Chamber of Commerce, key bills threatening policyholders’ savings include:

  • H.B. 451/SB 554, which would reintroduce litigation incentives;
  • H.B. 947/SB 1520, which would eliminate transparency requirements for medical costs in court;
  • H.B. 1437/SB 1840, which would reinstate attorney fee awards in auto insurance cases; and
  • H.B. 1551/SB 426, which would bring back attorney fees for property insurance lawsuits that were eliminated in 2022.

Before recent reforms, Florida homeowners paid premiums up to three times the national average. Since the reforms, 60 percent of the top 10 national insurers writing homeowners insurance in Florida have expanded their business over the past year, and 40 percent of all insurers operating in the state filed for rate decreases in 2024, according to Florida Insurance Commissioner Michael Yaworksy.

As Triple-I CEO Sean Kevelighan recently put it, “Citizens of the Sunshine State are now clearly seeing the benefits of a more stable and affordable insurance marketplace.”

The new legislation would reduce or even reverse that progress.

Learn More:

Florida Reforms Bear Fruit as Premium Rates Stabilize 

Florida’s Progress in Legal Reform: A Model for 2025

How Georgia Might Learn From Florida Reforms

Resilience Investments Paid Off in Florida During Hurricane Milton

Florida Homeowners Premium Growth Slows as Reforms Take Hold, Inflation Cools

Louisiana’s Insurance Woes Worsen as Florida Works to Fix Its Problems

Auto Insurance, Coastal Property, Homeowners Insurance, Insurers and the Economy, Legal Environment

Florida Reforms
Bear Fruit as Premium Rates Stabilize 

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Florida’s legislative reforms to address claim fraud and legal system abuse are stabilizing the state’s property/casualty insurance market, according to the latest Triple-I Issues Brief.  

Claims-related litigation has significantly declined over the past two years, and premium averages are nearly flat, with several insurers requesting rate decreases from the state’s insurance regulator.  In addition, the brief says, the number of insurers writing business in the state has rebounded after a multi-year exodus. This competition from the private market has allowed policyholders to leave Citizens Property Insurance Corp. – the state-run insurer of last resort – to obtain coverage at previously unavailable rates from a much healthier private market. 

According to the state’s Office of Insurance Regulation (OIR), Florida in 2022 accounted for nearly 71 percent of the nation’s homeowners claim-related litigation, despite representing only 15 percent of homeowners insurance claims. The same year – before Hurricane Ian made landfall in Florida – six insurers in the state declared insolvency, primarily due to economic pressures from legal system abuse. Based on insured losses, Ian became the second-most costly U.S. hurricane on record, due in large part to extraordinary litigation costs for disputed claims. 

The Legislature responded to the growing crisis by passing several pieces of insurance reform that, among other things, eliminated one-way attorney fees and assignment of benefits (AOB) for property insurance claims and prohibited misleading legal service ads and the misuse of consumer health information for legal services. 

Premium rate growth slowing 

The impact of the 2022 and 2023 reforms can be seen in premium rate changes, particularly with respect to homeowners insurance. Homeowners rates in Florida grew at a much slower rate in 2024, even as rate growth remained strong nationally. Growth in personal auto insurance premium rates in Florida has slowed since the repeal of AOB and one-way attorney fees, but the trend also is consistent with nationwide experience. 

“There are a lot of factors involved in insurance rates, and Florida’s property and auto markets are challenging,” Florida Governor Ron DeSantis said in February, “but…data suggests that, in 2024, Florida had the lowest average homeowners’ premium increases in the nation, and the overall market has stabilized, with 11 new companies having entered the market over the past two years.” 

Among the top 10 national insurers writing homeowners insurance in Florida, 60 percent have expanded their business over the past year, and 40 percent of all insurers operating in the state filed for rate decreases in 2024, according to Florida Insurance Commissioner Michael Yaworksy. 

The cost of reinsurance also continues to decrease for Florida carriers. 

“In 2024, most companies paid less for reinsurance than they did in 2023,” according to the OIR website. “The average risk-adjusted cost for 2024 was -0.7 percent, a large reduction from last year’s change of 27 percent increase from the prior year.” 

Reinsurance costs are factored into premium rates, so this is another reason Florida now has the lowest average rate filings in the United States in 2024, according to S&P Global Marketplace. 

Learn More: 

Florida’s Progress in Legal Reform: A Model for 2025 

How Georgia Might Learn From Florida Reforms 

Resilience Investments Paid Off in Florida During Hurricane Milton 

Florida Homeowners Premium Growth Slows as Reforms Take Hold, Inflation Cools 

Legal Environment

Georgia Targets
Legal System Abuse

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By Lewis Nibbelin, Contributing Writer, Triple-I

The Georgia Senate recently approved legislation aimed at curbing the state’s soaring litigation. Backed by Georgia Gov. Brian Kemp, Senate Bill 68 is designed to facilitate more equitable courtroom outcomes and stabilize insurance rates.

Among other provisions, the bill includes a cap on pain and suffering evidence that would reduce premises liability lawsuits, or those against owners for injuries and/or criminal conduct that occurred on their property. It also would restrict “phantom damages,” meaning plaintiffs could seek damages only in the amount actually paid for medical bills, rather than an inflated amount determined by a healthcare provider’s list prices.

Both practices have generated nuclear verdicts (awards of $10 million or more) in Georgia, contributing to the fourth-most nuclear verdicts in personal injury litigation per capita of any state from 2013 to 2022.

Another bill – SB 69 – targets third-party litigation funding, in which investors anonymously finance litigation and often delay prompt settlement in exchange for a share of larger damage awards, thereby driving up claims costs. If enacted, the bill would limit their influence over legal decisions and require third parties to register with the Department of Banking and Finance, effectively banning foreign adversaries from funding litigation.

Much of the legislation is based on a report from the office of Georgia Insurance and Safety Fire Commissioner John F. King, which revealed a steady increase in liability claims frequency and identified growing legal involvement in claims as a key driver of insurance rates.

“Georgia’s legal climate amounts to a hidden tax on families and small businesses, driving up costs and threatening our long-term future,” King said in a recent press conference, explaining that tort reform can “level the playing field in our courtrooms and help ensure Georgia’s long-term prosperity and security.”

Economic impact on Georgia

Georgia loses over 137,000 jobs annually due to excessive litigation, which further imposes an estimated $1,415 “tort tax” on each resident per year, earning the state a recurring spot on the American Tort Reform Foundation’s annual list of “judicial hellholes.” With litigation for personal auto claims at a rate more than twice that of the median state, Georgia also ranks among the least affordable states for personal auto insurance, according to research by the Insurance Research Council (IRC) – an affiliate of The Institutes, like Triple-I.

To bolster stakeholder education on the economic impacts of legal system abuse, Triple-I recently expanded its comprehensive awareness campaign in Georgia. The campaign now encompasses multiple brick-and-mortar interstate billboards in Downtown Atlanta, along with digital bus shelter billboards across the Metro Atlanta area. All billboards promote Triple-I’s microsite encouraging consumer support for reform in the state.

Though hundreds – including doctors and business owners – have galvanized behind the reforms, neither bill is without controversy. Opponents argue such legislation may not improve insurance rates and could overcorrect to favor insurance companies at the expense of policyholders.

Following reforms in 2022 and 2023, however, Florida welcomed flat or decreased insurance rates last year, as the state’s insurance market began to recover from its former status as the “poster child” for legal system abuse. Substantial rate reductions have continued into 2025, particularly for three major auto insurance carriers, according to Florida Gov. Ron Desantis’ announcement earlier this month.

While the specific policy levers may differ, Florida’s success models the potential benefits of similar legislation in other areas. Certainly, understanding and mitigating these trends is crucial to restoring Georgia’s economy.

Learn More:

New Triple-I Issue Brief Puts the Spotlight on Georgia’s Insurance Affordability Crisis

How Georgia Might Learn From Florida Reforms

Triple-I launches Campaign to Highlight Challenges to Insurance Affordability in Georgia

Georgia Is Among the Least Affordable States for Auto Insurance