All posts by Tasha Williams

Affordability, Homeowners Insurance, Industry Financials, Insurance Industry, Severe Convective Storm, Technology

Triple-I Issue Brief: Inflation, elevated replacement costs, and persistent climate-related losses continue to shape premiums and policyholder options for homeowners insurance

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A person's hands are arched over a small model of a home that is placed on top of an insurance contract.

The homeowners insurance market is catching up to its cost drivers while still facing challenges to affordability and availability. Rates continue to climb as natural disasters intensify and replacement costs rise, but industry analysts expect meaningful improvement over the next two years. A new Triple-I Issues Brief provides a snapshot of the market’s performance and outlook, and discusses how some trends are shaping its future.

The latest results for the product line have helped narrow the anticipated 2025 gap between the performance of the personal and commercial lines. Despite a volatile start to 2025 driven largely by January’s destructive Los Angeles wildfires, homeowners insurance is still headed for double-digit net written premium growth this year.

With ​​nearly half of all homes in the United States at risk of “severe or extreme” damage from weather related events, climate risk looms large. In January 2025, the U.S. Department of the Treasury released “Analyses of U.S. Homeowners Insurance Markets, 2018-2022: Climate-Related Risks and Other Factors.“ a report based on the most comprehensive and granular snapshot of the homeowners insurance market to date. The agency found that climate risk is making it more costly for insurers to operate, as insurers’ costs in 2018-2022 were higher in areas with the highest expected losses from climate-related perils. The paid loss ratio, which reflects how much insurers paid for claims relative to the premiums they collected, was highest in the highest-risk ZIP Codes.

In 2025, the U.S. experienced its first hurricane season without a single landfall in a decade. However, the Triple-I issue brief explains, while 2025 economic losses from natural catastrophes are running below recent averages, other perils — such as severe convective storms, wildfires, and flash flooding — are becoming formidable sources of insurer loss. These increasingly frequent moderate disasters are challenging traditional catastrophe models built around infrequent peak perils, such as major hurricanes.

At the same time, soaring replacement costs have become the new normal for the homeowners market. Repair and rebuilding expenses have jumped nearly 30 percent over the past five years, fueled by inflation, supply-chain disruptions, rising construction material prices, labor shortages, and, more recently, new federal tariffs. Although the full impact of these tariffs has been milder than expected so far, the worst effects may simply be deferred until 2026 as inventories decline. Rising replacement costs translate directly into higher claim payouts, placing additional pressure on insurers and, ultimately, policyholders.

Beyond tariffs, other political and regulatory shifts are adding a new uncertainty as federal disinvestment in climate monitoring and mitigation may impede the insurance industry’s ability to accurately price risk, predict future losses, and, ultimately, provide affordable coverage. Meanwhile, several states grapple with balancing affordability with the stability and solvency of their insurance markets.

Insurance pricing must reflect these increased risks to maintain policyholder surplus, the funds regulators require insurers to keep on hand to pay claims. If premium rates fail to reflect increased costs, insurers may rapidly drain their policyholder surplus. This issue brief discusses how emerging technologies, such as advanced predictive analytics, aerial imagery, and smart-home sensors, could pave the way for more accurate pricing, faster claims processing, and improved risk prevention.

An Insurance Research Council (IRC) study indicates that homeowners familiar with some AI-driven insurance solutions view pricing using those technologies as fairer and express fewer concerns overall. These tools may play a critical role in bolstering affordability, rebuilding trust, and strengthening the resilience of the homeowners’ insurance sector amid escalating climate and economic pressures.

The issue brief’s list of factors and trends impacting the homeowners’ market isn’t intended to be exhaustive. Accordingly, future briefs on homeowners (or property lines in general) may highlight other pertinent topics, such as the link between insurance premiums and property prices. While home values in high-risk areas can often be diminished by rising premiums, higher home values can generally mean higher replacement costs, and consequently, lead to higher premiums. As of early 2025, home prices are up 60 percent nationwide since 2019 and still rising by 3.9 percent YoY, according to the Joint Center for Housing Studies at Harvard University. The Harvard report cites Freddie Mac data indicating home insurance premiums jumped 57 percent from 2019 to 2024.

We invite you to read our take on the homeowners’ market and follow our blog to keep abreast of key issues impacting the industry.

Careers and Employment, Insurance Industry

BIIC Publishes New Research Advancing Pathway for Black Leadership in Insurance

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While the insurance workforce has become incrementally more diverse, Black professionals remain starkly underrepresented in C-suites and senior leadership.

The Black Insurance Industry Collective (BIIC) recently released a report, Fostering Black Leadership in Insurance, which calls attention to this industry-wide leadership gap.

The report explains how organizations can take strategic, data-driven actions to identify and overcome the structural barriers limiting the advancement of Black professionals in the industry.

Bureau of Labor Statistics data cited in the report shows that, in 2024, Black professionals made up 14.7 percent of the insurance workforce, up from 9.9 percent 10 years ago. Yet only 1.8 percent of executives at the 10 largest insurers were Black. Research shows companies with diverse leaders benefit, however.

“BIIC’s mission is to help the industry move from awareness to action,” says Amy-Cole Smith, Executive Director for BIIC/Director of Diversity at The Institutes. “Using various data sources, our report scans Black professionals’ representation in insurance, analyzes key structural challenges, and gives recommendations for setting targets and integrating accountability.”

The collective’s new report furthers its commitment to “identifying organizational strategies that enable talent to break through mid-level ceilings and into the C-suite.” It explains how diversity in senior management can positively affect brand, organizational culture, and the bottom line. Successful outcomes can include demonstrating a commitment to diversity in both the workforce and consumer markets, expanding organizational diversity, and achieving higher profits.

The report identifies four imperatives for measurable and sustainable progress:

  1. ​Accountability and transparency with data;
  2. Sponsorship initiatives to support potential leaders;
  3. Equitable succession planning that prepares diverse candidates before leadership vacancies arise; and
  4. A culture of psychological safety

These findings were the result of tackling the essential question, “Why haven’t hiring gains translated into increased representation in upper management?” Inequitable hiring and promotion, biased performance reviews, limited recruitment channels, and cultures that value “fit” over actual value can weaken the leadership pipeline. Many of these issues can occur across all organizational levels, but their cumulative effect is most evident in the C-suite.

For example, the report highlights the “glass cliff” phenomenon, whereby Black and other underrepresented professionals are often only promoted to senior roles during periods of organizational crisis. Explaining the lack of adequate support and long-term strategic commitment that often accompany these highly visible promotions, the report argues that this scenario heightens the risk of failure for newly appointed leaders and reinforces biased perceptions of leadership capability.

Putting a new leader on the glass cliff creates doubt about an organization’s overall commitment to maintaining a diverse workplace. BIIC indicates that a better course of action would require a strategic commitment to equity, such as involving Black professionals in succession planning during stable periods to prepare them for long-term success, rather than being positioned as last-resort problem solvers.

There is a discussion of problematic recruiting conventions, such as the tendency of hiring managers to use the word “qualified,” particularly in conversations about expanding recruitment to include more diverse candidates. This habit can perpetuate the bias that “diverse” and “qualified” candidates are mutually exclusive groups. Further, the word “qualified” isn’t tied to specific, objective, and job-relevant criteria. The resulting ambiguity allows the personal preferences of individual hiring managers (e.g., educational background, accent, or appearance) to shape their assessment of a candidate’s suitability, rather than focus on actual skills and ability to perform the job.

Community insights collected through BIIC’s engagements with more than 4,000 professionals reveal that career advancement can be hampered by a lack of visibility, insufficient exposure to decision-makers, or unclear career advancement pathways. Participants emphasized the importance of candid communication with managers, organizational agility, and access to leadership development opportunities in overcoming these barriers.

BIIC, a five-year-old nonprofit that is an affiliate of The Institutes, has worked to provide career advancement infrastructure for Black professionals – a strong network of peers, opportunities to learn from industry executives, and expanded resources through strategic partnerships such as 2022 collaboration with Darden School of Business at The University of Virginia.

Cole-Smith says, “BIIC’s goal is not only to elevate individual careers but also transform the industry’s leadership landscape, ensuring that diverse perspectives and voices shape its future.”

The insurance industry’s future depends on serving diverse communities, which requires addressing structural challenges and investing in inclusive leadership. Fostering Black Leadership in Insurance urges prompt action and systemic transformation. Even as workforce representation improves, advancement into executive ranks can remain restricted by persistent inequities unless organizations rise to the challenge.

Homeowners Insurance, Insurance Industry

COTW: Native Americans Face Heightened Extreme Weather Risks. 

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The bottom background color is white and displays a chart to the left and a text box to the right Chart Details: Title: American Indian and Alaska Native (AIAN) Population by County Subtitle: (Percent of Population) Chart description: A map colored by county in varying shades of blue Chart Data available upon request. The source data line reads: Sources: Analysis: Insurance Information Institute, Data: Census through Rural Health Information Hub; (As of 11/11/2025). The Census uses “AIAN” to represent people who self-identify as American Indian and Alaska Native. The first line of text, in a dark blue bolded font: The AIAN population is estimated to be about 7.1 Million or about 2.1% of the total U.S. population. Below, in plain black font, it says Key Numbers for AIAN: followed by the following two lines, each sentence a bullet point: 50.9% live in Oklahoma, Arizona, California, New Mexico, and Texas; facing heightened risks from wildfires, floods, tornadoes, and droughts. AIAN face higher death rates from extreme weather events than the total U.S. population, 0.6 per 100,000 compared to 0.2 per 100,000.
Chart of the Week 11 18 2025: Native Americans Face Heightened Extreme Weather Risks

As part of an ongoing discussion on the link between the housing and insurance markets, the Insurance Information Institute (Triple-I) released a Chart of the Week (COTW) that provides a snapshot of climate risk concerns for American Indian and Alaska Native (AIAN) population.

The provided estimate for the number of Native Americans in the U.S. is 7.1 million – about 2.1 percent of the total population. As much as 95 percent of the general U.S. population lives in a county that has experienced a natural disaster since 2011. However, this COTW says at least 50.9 percent of Native Americans live in states facing heightened risks from wildfires, floods, tornadoes, and droughts. The chart also reveals that Indigenous people in the U.S. face higher death rates from extreme weather events than the total national population, at 0.6 per 100,000 compared to 0.2 per 100,000.

Native communities are situated on the front line of climate risk.

As insurance is designed to help policyholders and their communities recover from insurable events, coverage availability and affordability can contribute to resilience. However, states that are home to at least half of the U.S. Native American population rank high on the Insurance Research Council (IRC) report, Homeowners Insurance Expenditures as a Percent of Median Household Income – Oklahoma (4th), Arizona (5th), Texas, (6th), New Mexico (14th), California (25th) – indicating comparatively less coverage affordability in those states. While availability and affordability can ultimately be driven by a mix of key underlying cost drivers, climate risk and home-ownership challenges can play a crucial role in access for many Native American homeowners.

Extreme weather events, such as hurricanes and typhoons, have shaped the way colonization of North America unfolded, beginning in the early centuries of European contact. For thousands of years prior, Native Americans had thrived in their homelands by taking measures to survive long-term severe weather, such as seasonally migrating away from flood-prone areas or building nature-based infrastructure as needed. Colonial expansion, in which Indigenous people lost nearly 99 percent of their historical land base over time, decimated Indigenous populations and pushed survivors into high-severe-weather-risk areas or lands, in many cases previously unknown to their respective tribal groups.

As a result of centuries of these forced removal policies and government-directed or sanctioned land dispossession, present-day Native American lands “are also generally far from historical lands, averaging a distance of roughly 150 miles” and are often in inherently more climate risk-prone areas today – i.e., low-lying, exposed, less habitable due to drought, etc. Living today on the front lines of climate risk across the U.S. means frequently experiencing acute effects, such as thawing permafrost, rising sea levels, increased flooding, stronger storms, erosion, and shifting ecosystems.

For instance, a 2024 study indicates that Oklahoma, home to 39 federally recognized tribal nations, “faces climate and demographic changes that disproportionately put many Native Americans at risk. The heavy rainfall, 2-year floods, and flash floods are all projected to have increased risks by 501.1 percent, 632.6 percent, and 296.4 percent, respectively.”

In a village in western Alaska, where permafrost is thawing, buildings (including a preschool) are shifting, water intrusion is increasing, and relocation is becoming a real threat. Recently, nearly 50 Alaska Native communities experienced “towering wind speeds, record storm surge, and widespread flooding”, resulting in at least one death and the displacement of 1,500 people. Initial estimates have reported that the storm decimated 90 percent of homes in the coastal village of Kipnuk and 35 percent in Kwigillingok, “which has also experienced toxic chemicals spilling into its freshwater supply.”

Climate risk can threaten lives and property, of course, but also regional economies, one of the key ingredients in building capacity for resilience. For example, a study of climate-driven economic challenges posed to Navajo Nation, the largest Indian reservation in the U.S., shows that “drought has a larger impact on cattle production than hay production, resulting in total economic losses of $8.2 million and $0.4 million for the cattle and hay sectors, respectively.” Without robust regional economies, infrastructure, or policy support, Native American homeowners and their communities may struggle to adapt or relocate effectively.

Homeownership costs may contribute to the protection gap.

Native American homeowners are more likely to lack coverage if they:

  • Are homeowners living in New Mexico and certain rural areas of Texas
  • have manufactured homes, or
  • own inherited homes.

Data collected through the Home Mortgage Disclosure Act (HMDA) reveals that Native Americans, on average, pay more to finance their homes – in some contexts up to two times more. While that disparity can be attributed to several factors, one major driver is the loan type that appears to be more common among Native borrowers, home-only loans. “Nearly 40 percent of loans to Native American borrowers on reservations were for manufactured homes, compared to 3 percent of loans to White borrowers”. Further, about 8 out of 10 manufactured-home loans were home-only loans.

Home-only loans, a financing tool used for movable personal property in which the lender retains ownership of the property until the borrower fully pays the loan, can make financial sense in some instances. Nonetheless, borrowers typically pay higher interest rates and have fewer consumer protections, such as federal guarantees, than regular mortgages. The pressure of these circumstances may compel the homeowners to carry insufficient coverage, or, when they pay off the loan, none at all.

Federal funding freezes can impede resilience.

Data from the National Congress of American Indians show that “U.S. citizens receive, on average, about $26 per person, per year, from the federal government, while tribal citizens receive approximately $3 per person, per year.”  Recent federal disinvestment in 2025 from crucial risk prevention and management programs and other supportive infrastructure –  including public radio stations which can be used for advance severe weather warnings and coordination of disaster recovery efforts – has exacerbated the burden from longstanding disparities. This decrease in support can also heighten the need for insurance coverage and closing the protection gap.

Amy Cole-Smith, Executive Director for BIIC/ Director of Diversity at The Institutes says, “the numbers are clear: Native Americans face higher exposure to extreme weather, higher insurance burdens, and higher rates of being uninsured. These factors reflect not just climate trends but historical inequities that continue to shape outcomes today. Strengthening coverage access is essential to protecting lives, homes, and cultural continuity.”

As Smith has often expressed, one way the industry can start closing the protection gap is “by having people at the table who understand the lived experiences behind the numbers.”

Triple-I works to advance the conversation around crucial issues in the insurance industry. We invite you to follow our blog to learn more about trends in insurance affordability and availability across the property/casualty market.

Careers and Employment, Insurance Industry

Chart of the Week, “U.S. GDP and Insurance Growth Bolstered by Hispanic and Latino Community.”

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Chart of the Week (COTW), "U.S. GDP and Insurance Industry Growth Bolstered by Hispanic and Latino Community

Even as Latinos continue to play an essential role in the U.S. economy, Latino representation of insurance industry workers fell slightly in 2024, to 14.9 percent, from 15.3 percent in 2023, according to a recent Triple-I “Chart of the Week”. The highest representation of this demographic was 18.3 percent of insurance sales agents, with claims and policy processing clerks following closely, at 17.7 percent. The lowest representation was among underwriters, at 8.8 percent.

The chart — “U.S. GDP and Insurance Industry Growth Bolstered by Hispanic and Latino Community.”  — is based on data from the Bureau of Labor Statistics and the U.S. Latino GDP report.

From 2019 to 2023, Latinos drove 30.6 percent of U.S. GDP growth despite making up only about 20 percent of the overall U.S. population (by 2024) and 19.4 percent of the workforce. Latinos generate a GDP of $4.1 trillion by 2023 (up from $3.7 trillion in 2022), sufficient to rank alone as the fifth-largest GDP in the world. The Latino consumer market, with $2.7 trillion in consumption in 2023, has a buying power larger than the economies of powerhouse states such as Texas ($2.58 trillion) and New York ($2.17 trillion).

The National Association of Hispanic Real Estate Professionals predicts that Latinos will be the largest group of homebuyers in the country by 2030. Homeownership for this group is 9.8 million households, with 238,000 new Latino owner households added in 2023 alone —the largest increase of any racial or ethnic group for the second consecutive year. Data analysis indicates there may be more than 30 million new Latino drivers hitting the roads through 2050. Latinos are also the fastest-growing group of entrepreneurs, according to the Stanford Latino Entrepreneurship Initiative.

Effectively engaging this formidable market creates immense opportunity for the insurance industry. However, only just over half of the respondents to a survey conducted by Marsh and the Latin American Association of Insurance Agencies (LAAIA) said they believed their companies were invested in attracting Hispanic customers. Nearly two-thirds of respondents said insurers do not employ enough Latinos. Only 14 percent thought insurers employed an adequate number. Moreover, 84 percent agreed that Latinos are underrepresented in the senior management of most insurance companies.

Efforts to create a diverse and inclusive workforce can drive greater client satisfaction and loyalty.  As Amy Cole-Smith, Executive Director for BIIC/ Director of Diversity at The Institutes, has pointed out, “this isn’t just about equity —it’s about unlocking growth and staying competitive in a changing market. When the insurance workforce reflects the diversity of the market, we’re in a stronger position to build products that meet people where they are.”

Insurance Industry, Legal Environment

New Consumer Guide Highlights The Economic Impact of Legal System Abuse and the Need for Reform

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By Tasha Williams and Loretta Worters

Practices that foster unnecessary or drawn-out litigation are among several hard-to-measure forces that can shift loss ratios for insurers and disrupt forecasts, making cost management more challenging. Ultimately, the resulting cost increase is passed on to consumers, which adversely impacts the affordability and availability of coverage. The Insurance Information Institute (Triple-I) and Munich Re US published a new resource to help consumers understand how legal system abuse is fueling higher claim costs, driving up premiums, and reducing the efficiency of our civil justice system.

A Consumer Guide: How Legal System Abuse Impacts You explains, using accessible language and engaging graphics, how elements of legal system abuse – including third-party litigation financing, persuasive jury anchoring, and the deluge of attorney advertising – can distort outcomes and siphon value away from injured parties, policyholders, and the economy.

“Legal system abuse has driven up litigation expenses and costs, impacting businesses and consumers across the United States,” said Joshua Hackett, Head of Casualty at Munich Re US. “If left unchecked, these rising costs will continue to increase insurance premiums and limit coverage options.”

The consumer guide outlines legal trends and quantifies the impact of legal system abuse beyond rising premiums.

• $6,664 in added annual costs for the average American family of four

• 4.8 million U.S. jobs lost due to excessive litigation

• $160 billion in tort-related costs borne by small businesses annually

Who Benefits from Large Settlements?

The narrative of legal system abuse can be muddled by news of large, high-profile settlements, which can imply plaintiffs are winning big. In reality, injured parties typically end up with only a fraction of their awarded damages after fees, obligations to third-party litigation funders, and inflated expenses are taken into account.

According to a recent report from Duane Morris Class Action Review, a defense attorney interest group, $42 billion in class action settlements was reached last year, the third-highest value the group has tallied over the past twenty years. That figure included ten settlements of at least $1 billion. Products Liability Class Actions reaped by far the largest amount for a practice area, at $23.40 billion. Annual numbers for overall settlements reported in 2023 and 2022 were $51.4 billion and $60 billion, respectively.

However, the bulk of these settlements do not ultimately benefit the injured parties. Attorneys can charge contingency fees ranging from 33 to 40 percent for their labor, plus expenses incurred through litigation, such as court costs and expert witness fees. Additionally, the process for injured parties to claim and receive their share of the settlement can be complex and drawn out, and, often, it is not worth the small share amounts dispersed to most claimants in the long run. A 2019 Federal Trade Commission study estimates the median claims rate for consumer class action settlements was 9 percent and that the weighted mean — weighted by the size of the class — was only 4 percent.

“While billboard attorneys use exploitative advertisements promising big dollar settlements, the truth is consumers and business owners can be left with less money, sometimes substantially less, if third-party litigation financiers are involved,” said Triple-I CEO Sean Kevelighan.

The consumer guide reinforces what many risk and claims professionals are observing in the market.

  • Longer case durations
  • Higher settlements and awards
  • Diminishing predictability in the legal environment

This erosion of predictability poses underwriting challenges and affects the affordability and availability of coverage, particularly in casualty and liability lines.

Legal system abuse can be mitigated by supporting public awareness and robust tort reform policy.

Triple-I and Munich Re US are encouraging the industry to advocate for:

  • Disclosure requirements for litigation financing
  • Reforms to reduce medical billing abuse
  • More oversight of attorney advertising practices

The guide serves as an educational tool that insurers, brokers, and industry partners can share with clients and stakeholders to explain the link between premium increases, other rising costs, and potential legal exposure.

This collaboration between Triple-I and Munich Re US is part of Triple-I’s multi-faceted awareness campaign to help educate industry insiders, consumers, and other stakeholders about the challenges posed by legal system abuse to coverage affordability and availability. We invite you to learn more about legal system abuse by reading our issue briefs, such as “Legal System Abuse: State of the Risk” and “Legal System Abuse and Attorney Advertising for Mass Litigation: State of the Risk,” and visiting our knowledge hub on this topic. To join the discussion, register for JIF 2025.

Homeowners Insurance, Insurance Industry, Insurers and the Economy, Specialty Coverage

LGBTQIA+ Homeownership Gap May Be Fueling Insurance Protection Gap

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Chart of the Week (COTW), As Fewer Same-Sex Couples Own Their Dwelling, They Face a Larger Insurance Protection Gap. The homeownership gap for same-sex couple households is 25.2% based on the most recent data.
The homeownership gap for same-sex couple households is 25.2% based on the most recent data.

As part of an ongoing discussion on the link between the housing and insurance markets, the Insurance Information Institute (Triple-I) released a Chart of the Week (COTW), “As Fewer Same-Sex Couples Own Their Dwelling, They Face a Larger Insurance Protection Gap.” Based on data from 2023, 62.6 percent of same-sex households own their homes and 37.4 percent rent, representing a homeownership gap of 25.2 percentage points within this community. In comparison, 82 percent of married opposite-sex households own their homes, while only 18 percent rent.

In the United States, homeownership offers several benefits (versus renting) to those with the financial resources to achieve and sustain it. Owners can accrue equity to increase their chances of making a profit when they sell their home. They can reap tax benefits through mortgage deductions. Mortgage holders can also lower monthly housing costs when interest rates drop. Ultimately, a home can increase personal net worth and offer a mechanism to transfer wealth to the next generation. Protecting this asset and its contents makes good financial sense.

Renters may not own their dwelling, but they keep personal belongings in it. They can face serious financial risks in the event of a loss, theft, disaster, or personal liability event. Yet, according to the COTW, 43 percent of renters are uninsured or underinsured, compared to 30 percent of homeowners. There are several reasons attributable to this difference, but it’s essential to keep one at the forefront: insurance coverage requirements are commonplace in mortgage agreements but not in lease agreements. Thus, homeownership status can drive participation in the insurance market.

Examining factors that impede homeownership for same-sex couples might shed light on how to attract and retain more policyholders in this demographic. Looking closely at the interplay of just three of these – housing prices, geography, and legislative environment – reveals that housing tends to be more expensive in LGBTQIA+-friendly areas. Prospective buyers may need to earn at least $150,000 a year – as much as 50 percent more – to avoid living in regions without basic legal protections, according to a recent study of real estate market data across 54 major U.S. metropolitan areas.

High monthly housing costs strain budgets, pushing homeowners and renters out of the insurance market. It can also put the financial qualifications for home buying – i.e., building credit and savings – out of reach. Households are considered cost-burdened when they spend more than 30 percent of their income on rent, mortgage payments, and other housing costs, according to the U.S. Department of Housing and Urban Development (HUD).

Nationwide, renters had higher median housing costs as a percentage of their income (31.0 percent) compared to homeowners (21.1 percent for homeowners with a mortgage and 11.5 percent for those without a mortgage). In metropolitan areas that welcome and protect diversity, renters are more likely to be housing cost-burdened, particularly in New York (52.1 percent of residents pay more than 30 percent of their income) and San Francisco (37.6 percent of residents). Renters in states and municipalities where legislation is considerably less welcoming but rents are lower can face comparatively higher premiums for rental coverage.

Despite the legalization of same-sex marriage and various anti-discrimination laws, the LGBTQ community still battles considerable discrimination and systemic biases in many areas of life, including housing. Insurers can work to better understand the diverse needs of LGBTQIA+ individuals, couples, and their families, facilitating more effective solutions for managing financial risks. And most importantly, the industry can improve communication around potential coverage benefits for these households.

“We can start closing the protection gap by having people at the table who understand the lived experiences behind the numbers,” says Amy Cole-Smith, Executive Director for BIIC/ Director of Diversity at The Institutes.

For example, renters might find it helpful to know their policy covers a loss event linked to discrimination against them, such as malicious damage or vandalism to the property by a third party. Even when it’s evident the destruction isn’t the renter’s fault, the landlord might still attempt to hold them responsible, either through a lawsuit, a rent increase, or eviction. Additionally, unmarried couples should be informed about whether the insurer includes both partners’ names on a policy and how this provision affects them in the event of a claim.

“Cultivating an inclusive workforce drives smarter solutions, like renters’ insurance that aligns with the realities of same-sex couples, more equitable underwriting, and marketing that truly resonates,” Cole-Smith says. “This isn’t just about equity—it’s about unlocking growth and staying competitive in a changing market. When the insurance workforce reflects the diversity of the market, we’re in a stronger position to build products that meet people where they are.”

Triple-I works to advance the conversation around crucial issues in the insurance industry, including Talent and Recruitment. To join the discussion, register for JIF 2025. We also invite you to follow our blog to learn more about trends in insurance affordability and availability across the property/casualty market.

Insurance Industry, Legal Environment, Risk Management

Triple-I Brief Highlights Legal System Abuse and Attorney Advertising

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The Insurance Information Institute (Triple-I) has released its latest issues brief, Legal System Abuse and Attorney Advertising for Mass Litigation: State of the Risk, which discusses how mass torts, specifically Multidistrict Litigation, and aggressive attorney advertising can in combination fuel the risk of legal system abuse.

Advertising is one of the most common methods companies use to sell their products and services and influence public perceptions. While the issue brief doesn’t argue that general advertising or filing for due process is problematic, it does offer a risk management-based lens for viewing how aggressive attorney advertising campaigns can fuel costs associated with settling claims.

Key Findings

  • Legal service providers spent $2.5 billion on 26.9 million ads across the United States.
  • Research suggests that legal advertising increases the number of plaintiffs in multidistrict litigation (MDL), which are large lawsuits consisting of multiple civil cases involving one or more common questions of fact but pending in different districts.
  • Product liability cases, which accounted for 38 percent of pending MDLs as of August 2023, emerged as the single largest category of MDLs, while other case types have decreased from 2012 to 2022.
  • The third-party litigation funding market, with an estimated size of $16 billion, is a likely resource for advertising budgets for mass torts; however, 12 states and two jurisdictions have enacted or are considering disclosure requirements.

Ads for legal services and lawsuits saturate all channels of communication – public billboards, radio and television broadcasts, and social media – dangling the lure of a financial windfall. Legal services marketing isn’t uniquely used for mass litigation cases. Nonetheless, it is overall geared to recruit as many lawsuit filers as possible. Therefore, aggressive advertising for legal services introduces the risk of fueling higher claim costs via problematic litigation.

These advertisements often employ an exaggerated sense of urgency, urging the target audience to take immediate legal action without considering alternative options for resolution. These ads may also often overpromise results by implying guaranteed windfalls (i.e., “We’ll get you your money’’), creating unrealistic expectations for plaintiffs and, thus, potentially impacting the time to settle. Additionally, when ads mention a particular product or brand, attorneys communicate plaintiff-biased information to potential jurors. In essence, a juror may recall seeing a flood of advertisements about the product and think, “Where there’s smoke, there must be fire.”

The brief focuses on MDLs because these are complex, huge, and slow-paced cases that may sometimes involve hundreds, even thousands of individual lawsuits. Therefore, these cases inherently carry the risk of driving up legal costs. Also, the large number of plaintiffs introduces the risk that questionable claims might slip into the lawsuit. For example, a particular product may have indeed caused harm to some, but not all, of the plaintiffs who used it.

Pummeling the world with ads can be expensive. Enter the third-party litigation funding (TPLF) market, which, despite tighter capital controls in recent years, grew to $16 billion in 2024, up from $15.2 billion in 2023. TPLF offers discretionary funding to the litigation industry, which can, in turn, use the money to fuel more lawsuits seeking large settlements — a boon for the firms and the funder. The brief outlines how several states and jurisdictions are moving to create transparency around TPLF involvement.

Practices that foster unnecessary or drawn-out litigation are among several hard-to-measure forces that can shift loss ratios for insurers and disrupt forecasts, making cost management more challenging. Ultimately, the cost is passed on to consumers, adversely impacting coverage affordability and availability. Triple-I is committed to advancing conversations with business leaders, government regulators, consumers, and other stakeholders to attack the risk crisis and chart a path forward.

Read the issue brief to find out more about how attorney advertising can contribute to legal system abuse. To join the discussion, register for JIF 2025. Follow our blog to learn more about trends in insurance affordability and availability across the property/casualty market.

Auto Insurance, Business Insurance, Insurance Industry, Insurers and the Economy

Tariff Uncertainty May Strain Insurance Markets, Challenge Affordability

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Chief Economist and Data Scientist, Dr. Michel Léonard

Recent tariffs issued by U.S. President Donald Trump are on track to increase the price of parts and materials used in repairing and restoring property after an insurable event. Analysts and economists, predict these price hikes will lead to higher claim payouts for P&C insurers and, ultimately, higher premiums for policyholders. 

After making several announcements since early March 2025, on April 2, President Trump signed an executive order imposing a minimum 10 percent tariff on all U.S. imports, with higher levies on imports from 57 specific trading partners. A general tariff rate became effective on April 5, while tariffs on imports from the targeted nations, ranging from 11 to 50 percent, took effect on April 9. A 25 percent tariff applies to all steel and aluminum imports and cars. President Trump says he might consider a one-month exemption to the auto industry, but as of this writing, no changes have been issued. 

Generally, tariffs can bring in revenue for the issuing government but lower the operating margin for impacted domestic businesses. Inventory and supply chain managers may attempt to stockpile in advance of the new rates becoming effective, which in turn can spike demand and quickly spike prices for sought-after items. Eventually, these cost hikes get passed on to consumers.  

Nonetheless, to ride out the situation, inventory and supply chain managers need a fundamental level of predictability regarding what the levies will cover, what the rates are, and when these rates go into effect. The timing and scope of President Trump’s tariff policies have been challenging to nail down, including for many goods particularly relevant to construction and auto manufacturing. For example, his initially declared rates for major trading partners – Canada, Mexico, the European Union, and China – have fluctuated as these nations announced reciprocal tariffs, and those levies, in turn, were met with higher US rates. 

Then, on April 9, President Trump declared a 90-day pause on tariffs. This change was actually not a true pause but a reduction of previous rates for several countries to 10 percent, except for China. The White House has declared on April 10 that the previously announced 125 percent rate against goods from China is actually now 145 percent. 

According to S&P, the levy on auto industry imports has been comparatively less dynamic as, despite confusing announcements from the White House, there has been no change to President Trump’s 25 percent rate declared on March 26, “which applies to all light-vehicle imports, regardless of country. The 25 percent tariff includes auto parts as well as completely built up (CBU) vehicles. The CBU autos tariff went into effect on April 3, 2025, while the auto parts portion is due to come into effect on May 3, 2025.” 

As insurers grapple with risk management and inflationary pressures, other challenges posed by the tariffs can include issues for policyholders, specifically coverage affordability and availability. One downstream side effect may be the increased risk of expanding the protection gap – uninsurance and underinsurance (UM/UIM) due to higher premiums and higher valuations that can come into play when materials costs rise. Across the fifty states and the District of Columbia, one in three drivers (33.4 percent) were either uninsured or underinsured in 2023, according to a recent report, Uninsured and Underinsured Motorists: 2017–2023, by the Insurance Research Council (IRC), affiliated with The Institutes. 

Our Chief Economist and Data Scientist, Dr. Michel Léonard, shares his analysis of how the tariffs may impact the P&C Insurance industry.  

“There’s no crystal ball”, say Dr. Léonard, “but prudent risk underwriting and risk management suggests the use of scenarios and increased price ranges for different tariff levels, the more precise impact of which can be updated based on actual price increases for individual prices.”  

Dr. Léonard outlines three types of P&C replacement cost scenarios given different tariff ranges: 

1) For single-digit tariffs, while inventories last, higher prices below that tariff’s rate;  

2) for single-digit tariffs on goods still economically viable post-tariffs, higher prices up to the tariff’s rate; and  

3) for single and double-digit tariffs on goods no longer economically viable, a multiple of the pre-tariff price for tariff-evading goods.  

His presentation, Tariffs and Insurance: Economic Insights can be previewed, but the full version is currently available exclusively to Triple-I members.  

Triple-I remains committed to keeping abreast of these and other developments crucial to the insurance industry’s future. For more information, we invite you to stay tuned to our blog and join us at JIF 2025. 

Careers and Employment, Insurance Industry

Women continue to hold 59 percent of the insurance workforce, with representation among underwriters increasing by 5 percent.

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On March 3, Triple-I released its Chart of the Week, “Women’s Representation Among Underwriters Increased.” Citing data from the Bureau of Labor Statistics, the chart reveals that the number of women insurance Underwriters increased by 5 percent from 56.9 percent to 61.9 percent in 2024.

The insurance sector provided about 3.0 million jobs–or 1.9 percent of U.S. employment (workers 16 years and over) in 2024. Data from the Bureau of Labor Statistics indicates that 1.7 million workers were women.  Since 2012, women have comprised about the same overall proportion (about 59 percent) of the industry workforce each year. However, the latest COTW shows that representation continues to vary across occupations. From 2023 to 2024, women’s representation among Insurance Clerks decreased 1.4 percent, from 80.1 percent to 78.7 percent. Representation among Insurance Sales Agents decreased 3.8 percent, from 54.9 percent to 51.1 percent.

The average representation of women across the U.S. workforce is 47 percent based on data from households in the Current Population Survey (CPS), an annual survey of business establishments in private industry conducted by the Bureau of Labor Statistics (BLS). 

Life insurance, annuities, and home and auto insurance sectors are considerably more gender diverse than the average industry in North America, especially in entry-level jobs, where women make up two-thirds of the 70% of entry-level workers. In contrast to the abundance of representation at the bottom, the view across the top ranks looks notably different. Only about 22 percent (less than 1 in 4) of workers in the C-Suite are women, and only two women CEOs head up Fortune 500 insurance companies: Thasunda Brown Duckett, President and Chief Executive Officer of TIAA, and Tricia Griffith, President and Chief Executive Officer of the Progressive Group of Insurance Companies.

Nonetheless, women continue to demonstrate their skills, willingness to grow, and ability to influence the insurance industry in a positive and forward-thinking way.  According to McKinsey, for every 100 men promoted to managerial positions, 104 women are promoted — much higher than the 87 women promoted across all industries. At the board level, women hold 40 percent of the seats in the aforementioned industry sectors.

However, from entry-level to managerial level, the women in the industry are predominantly white, with the leadership pipeline remaining even more closed off to women of color. Only one in 20 senior vice presidents and one in 35 direct reports to CEOs in insurance are women of color.  Black women comprise more than 7 percent of the entry-level insurance workforce, but this number plummets along the corporate ladder and falls to virtually zero at the C-suite.

There’s evidence that women as workers in the insurance industry go back a long way, as far back as 1797. Their tremendous impact on the industry as consumers likely pivoted in 1839 with individual American states passing the Married Women’s Property Act, allowing life insurance proceeds to be passed to a widow without being subject to the demands of the husband’s debtors. By 1942, women accounted for 30% of total life insurance sales, and just two years later, women were buying 83% more life insurance than they did in 1942.

Today, keeping risk management solutions easily accessible and tailored to the market’s needs is arguably the biggest core challenge facing insurers. Research indicates that female CEOs among U.S. property-casualty insurance companies are associated with “lower insurer insolvency propensity, higher z-score, and lower standard deviation of return on assets.”  Additionally, data suggested that as consumers, women tend to spend comparatively more of their income on insurance and have different consumer behavioral preferences that may compel a rethinking of insurance value chains.

Thus, insurers may discover that fostering an inclusive culture that welcomes more women into leadership can be a faster path to successful outcomes. Join us at the upcoming JIF 2025 event and follow our blog for more insights on the future of insurance.

Auto Insurance, Insurance Industry, Risk Management

IRC report reveals that one in three drivers were either uninsured or underinsured in 2023. 

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In 2023, despite nearly universal legal requirements to have auto insurance, more than one in seven drivers (15.4 percent) nationally were uninsured, and more than one in six drivers (18.0 percent) were underinsured, according to the new report, Uninsured and Underinsured Motorists: 2017–2023, by the Insurance Research Council (IRC), affiliated with The Institutes. Across the fifty states and the District of Columbia, one in three drivers (33.4 percent) were either uninsured or underinsured in 2023, a 10 percentage point increase in the combined rate since 2017.  

Using data submitted by 17 insurers — representing approximately 55 percent of the private passenger auto insurance market countrywide — this latest report estimated the prevalence of uninsured (UM) and underinsured (UIM) by comparing the frequency of UM claims and UIM claims, respectively, to the frequency of bodily injury (BI) claims. Findings included an analysis of trends and contributing factors to variations in UM and UIM rates across states. 

The IRC analyzed UM, UIM, and BI liability exposure and claim count data from participating companies for 2017 through 2023. Because of the disruption of the pandemic shutdowns, the changes over time were split into three periods (details outlined in the report).  

Key IRC findings include:  

  • UM rates varied substantially across the nation (50 states and the District of Columbia) 
  • Nearly every state saw a rise in the UM rate in 2020 with the onset of the pandemic, but the experience from 2020 to 2023 was mixed.  
  • Every state, except for New York and the District of Columbia, experienced a rise in UIM rate between 2017 and 2023.  
  • Many states with high UM rates often also have high UIM rates. However, some jurisdictions, such as Nevada and Louisiana, combine below-average UM rates with high UIM rates, while others, such as the District of Columbia, have high UM rates but low UIM rates.  
  • Several factors, including economic factors, insurance costs, and state insurance laws and regulations, are associated with variations in UM and UIM rates across states. 

After the initial shock of the pandemic, the UM rate increased steadily. 

Before the disruption of the COVID-19 pandemic, UM rates were falling in most states. From 2017 to 2019, only 11 jurisdictions saw an increase. UM claim frequency fell slightly in 2020 to 0.11 claims per 100 insured vehicles, but the decline was much smaller than the drop in BI claim frequency. UM claim frequency recovered quickly and, in the years since 2020, has grown faster than BI claim frequency (39 percent compared with 29 percent).   

As a result, the UM rate has increased steadily, reaching 15.4 percent in 2023. The range of the UM rates spanned from a low of 5.7 percent in Maine to a high of 28.2 percent in Mississippi. Outliers include eight states with UM rates above 20 percent and 11 states with rates lower than 10 percent.  

States with above-average BI claim frequency and UM claim frequency tended to have higher UM rates. Yet, some states with low UM claim frequency rates have a relatively high UM rate. In Michigan, for example, strict no-fault rules limit the number of BI claims, so the ratio of UM-to-BI claim frequencies is high. Lower UM rates tended to occur in states with higher income, lower unemployment rates, lower insurance expenditures, low minimum limits, and a lack of stacking provisions.  

UM rates were higher in states that don’t require UIM coverage. In 2023, the UM rate was 14.9 percent in states that do not require UIM insurance, compared with 11.6 percent in states that require it. Where UIM coverage isn’t required by law, UM rates were significantly higher in the years captured in this study, with the rate in 2023 at 18.9 percent in states that don’t require UIM insurance, compared with 13.3 percent in states that require it.   

Nearly one in five accidents with injuries involved losses more than the at-fault driver’s coverage limits. 

Over the study period, nearly every jurisdiction experienced an increase in its UIM rate. The only exceptions were a small decline (0.9%) in the District of Columbia and a 6.6 percent decline in New York. The largest increase occurred in Colorado, where the UIM rate rose 24.4 percentage points. Other states with above-average increases included Michigan, Kentucky, and Georgia.  

UIM claim frequency showed a small increase between 2017 and 2019 before dropping slightly in 2020. In the years since the onset of the pandemic, with the severity of auto injury claims on the rise, UIM claim frequency has increased markedly, reaching 0.17 claims per 100 insured vehicles in 2023. Since 2020, the growth in UIM claim frequency was double the growth in BI frequency. As a result, the UIM rate has increased significantly, rising to 18.0 percent in 2023.  

IRC analysis showed that characteristics associated with lower UIM rates included higher income, lower unemployment rates, lower insurance expenditures, high or medium minimum limits, lack of stacking provisions, and use of a limits trigger for UIM coverage rather than a damages trigger. States with high UM rates often also have high UIM rates. Florida, Colorado, and Michigan all rank relatively high for both measures, while Maine, Massachusetts, and Nebraska all rank relatively low.  

“The increase in UIM rates points to higher UIM premiums in the future, worsening affordability and potentially increasing the likelihood of more uninsured drivers. This demonstrates the complex interconnectedness of these two coverages as insurers protect consumers from insufficient coverage by at-fault drivers,” said Dale Porfilio, president of the IRC and chief insurance officer at the Insurance Information Institute (Triple-I). 

While state laws regarding mandatory requirements for uninsured and underinsured motorists vary, nearly all states have a legislation framework that requires all drivers to have some auto liability insurance to drive a motor vehicle. Drivers in most states are also required to purchase additional protection to provide coverage if the at-fault driver cannot afford to pay for the damage they caused. However, legislators in several states have enacted “no pay, no play” laws, which ban uninsured drivers from suing for noneconomic damages such as pain and suffering. A handful of states have programs to assist lower-income drivers, and drivers can check with their state’s insurance division to see if they are eligible.  

To learn more about UM/UIM trends, read the IRC report, Uninsured and Underinsured Motorists: 2017–2023, and check out the Triple-I Backgrounder on Compulsory Auto/Uninsured Motorists.