Category Archives: Auto Insurance

Affordability, Auto Insurance, Insurers and the Economy, Legal Environment

New York Among
Least Affordable States for Auto Insurance

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By Lewis Nibbelin, Research Writer, Triple-I

New Yorkers pay the fourth-highest personal auto expenditures in the United States, costing households an average of $1,935 in 2024, or 2.23 percent of the state’s median household income, according to Triple-I’s latest Affordability Outlook.

Up from New York’s average of $1,753 in 2023, Triple-I’s estimates reflect the burgeoning toll of several expenditure cost drivers in the Empire State, many of which are structural factors beyond the insurance industry. Citing data from the Insurance Research Council (IRC) – like Triple-I, an affiliate of The Institutes – the report highlights four cost drivers that rank among the highest in the country, including:

  • Repair costs: New York has the third-highest auto repairs costs in the United States, at $864 more than the national average;
  • Carrier expense index: New York has the third-highest carrier expense index for personal auto insurance, at 14.9 percent of losses;
  • Injury claim costs: New York has the third-highest average injury claim severity in the country, at more than twice the national average; and
  • Accident frequency: New York has the eighth-highest average frequency of personal auto accidents in the nation, at 3.09 accidents.

While traffic density, road conditions, and driver education can contribute to accident frequency and severity, excessive and fraudulent claims litigation also fuel rising auto insurance premiums and overall costs in the state. Wiping out billions of dollars in U.S. economic activity annually, legal system abuse costs New York residents 427,794 jobs and $7,027 for each household per year, earning the state a recurring spot on the American Tort Reform Foundation’s list of “judicial hellholes.”

A surge in staged crashes underpins these figures, leaving drivers increasingly vulnerable to fraudulent damage or injury claims. Such incidents – totaling 1,729 in New York in 2023 – keep upward pressure on auto rates for all policyholders, inflating average auto premium by as much as $300 per year, Triple-I estimates.

To alleviate these cost burdens, a package of state budget proposals was recently unveiled to secure $2 million in funding for investigations into alleged auto fraud and introduce new regulations that extend the timeframe for carriers to report suspicious claims. Another law would cap pain and suffering damages awarded to drivers who engaged in criminal behavior, such as those who were uninsured at the time of the incident.

New York policymakers also passed legislation last month aimed at third-party litigation funding (TPLF), or funding from often anonymous investors who can delay prompt settlements in exchange for a share of larger damage awards, thereby propelling claims costs. Though falling short of mandating TPLF disclosure during litigation, the new law parallels effective tort reforms in other states, offering hope toward insurance market stability.

Homeowners insurance holds steady

Conversely, New York’s homeowners insurance premiums “are relatively average and reasonable as a percentage of household income,” contradicting “the narrative of an affordability crisis in New York’s homeowners insurance market,” said Patrick Schmid, Triple-I’s chief insurance officer, in written testimony to state lawmakers.

With a 2.11 percent ratio of homeowners insurance expenditure to median household income, New York ranks 29th in an affordability study by the IRC, suggesting property and replacement costs contribute to the state’s housing affordability issues.

Policy interventions in insurance markets “would address a symptom rather than the cause” of such issues, Schmid stressed, urging lawmakers to focus instead on improving building material and labor costs; litigation trends; and other inflationary pressures.

While the specific policy levers may differ, Florida’s legal reforms in 2022 and 2023 led to 17 new insurance companies entering the state and rate reductions for dozens of homeowners and auto insurers, including a 6.5 percent average rate decrease for the state’s top five personal auto insurers in 2025.

Once a “poster child” for legal system abuse, Florida’s success demonstrates the need for continued reform in 2026 to promote a more competitive insurance market and greater affordability for consumers.

Learn More:

Triple-I Testifies on New York Insurance Affordability

Florida Governor Touts Auto Insurance Rebates, Tort Reform Success

Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

Insurance Affordability, Availability Demand Collaboration, Innovation

Disasters, Litigation Reshape Homeowners’ Insurance Affordability

Auto Insurance, Business Insurance, General Liability, Homeowners Insurance, Insurers and the Economy, Market Conditions, Workers Compensation

Resilient U.S. P/C Market Performance Sets Stage for a Complex 2026

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By William Nibbelin, Senior Research Actuary, Triple-I 

The U.S. property/casualty insurance industry demonstrated notable resilience throughout 2025, navigating a landscape marked by significant regional catastrophes and shifting economic pressures, according to the latest Insurance Economics and Underwriting Projections: A Forward View report from Triple-I and Milliman.

As the industry moves into 2026, the report notes, it does so from a position of historical strength yet faces an increasingly nuanced outlook shaped by market softening and lingering macroeconomic uncertainties.

The Triple-I/Milliman report is based on data through the third quarter of 2025,

Industry-Wide Performance and Profitability

The P/C insurance industry is forecast to achieve its lowest net combined ratio (NCR) in over a decade for the full year 2025. This achievement is particularly significant, given the challenges faced early in the year, including the devastating Los Angeles wildfires in January 2025.

A key driver of this success was the first Atlantic hurricane season with no U.S. landfall in 10 years. However, while profitability reached peak levels, top-line growth began to moderate. Aggregate net premium growth across all lines for 2025 is expected to be 5.9 percent, reflecting a continued slowing of the growth rate compared to 2024.

“We’re on track to achieve the lowest net combined ratio in over a decade, thanks in part to a hurricane season that spared the U.S. and strong homeowners performance, even after the Los Angeles fires in Q1 2025,” said Patrick Schmid, Ph.D., chief insurance officer at Triple-I. “Growth in personal lines premiums remains solid, and the narrowing gap between personal and commercial lines performance points to a cautiously optimistic outlook for the industry.”

Economic Outlook: Stability Meets Vulnerability

While the broader U.S. economy and the P/C sector remain stable, economists are keeping a close watch on emerging risks. The industry’s ability to maintain its momentum in 2026 may be tested by rising political and geopolitical tensions, as well as potential shifts in the labor market.

“Overall, the P/C insurance industry and the broader U.S. economy remain stable,” said Michel Léonard, Ph.D., CBE, chief economist and data scientist at Triple-I. “However, despite stronger-than-expected GDP growth in the third quarter, a closer look at the data suggests the U.S. economy may be increasingly vulnerable to rising economic, political, and geopolitical uncertainty. In particular, P/C replacement costs could still see significant increases in 2026, weighing on overall P/C performance.”

Léonard further highlighted that the labor market serves as a critical indicator, noting that a rise in the unemployment rate toward 5.0% over the next six months could potentially trigger an economic contraction.

Underwriting Results by Line of Business

Personal lines continue to anchor the industry’s profitability. Personal auto remains a standout performer with a forecast 2025 NCR of 94.4, an improvement over 2024 results. However, premium growth in this sector has slowed significantly, with net written premium growth expected to land at 3.6 percent — its lowest level since 2020. Homeowners’ insurance also showed remarkable recovery. Despite the heavy losses from the Los Angeles fires in the first quarter, the line’s 2025 NCR is forecast at 99.6, placing it on par with 2024 performance.

Commercial lines continue to face ongoing challenges in liability. While most of the industry enjoys profitability, general liability and commercial auto remain the only major lines forecast to stay above a 100 NCR for 2025. General liability continues to struggle with the highest Q3 direct incurred loss ratio reported in over 15 years.

Jason B. Kurtz, FCAS, MAAA, principal and consulting actuary at Milliman, detailed these persistent hurdles.

“General liability faces continued challenges,” Kurtz said. “Our 2025 net combined ratio is forecast to be similar to 2024, among the worst in over a decade. Losses are high, with Q3 direct incurred loss ratios being the highest in at least 25 years.”

He added, “While conditions may improve in 2026-2027, profitability remains a hurdle. Our general liability’s NCR expectations have risen following a challenging Q3, reflecting ongoing pressure in the segment. While some coverages are experiencing soft market conditions, aggregate premiums have been growing, but not enough to keep pace with loss trends.  We anticipate additional premium growth will be needed to improve general liability profitability.”

Workers’ compensation remains the strongest performing major line, with NCRs forecast to stay in the high 80s to low 90s through 2027. This sustained success is attributed to disciplined risk management and favorable prior accident year development.

“NCCI’s latest loss ratio trends continue to show declines,” said Donna Glenn, NCCI chief actuary. “In the current environment, modest year-to-year decreases are still expected.” Glenn noted that “while there have been a few rate increases filed in NCCI states, every state has its own story, and based on the latest data, NCCI does not anticipate any imminent reversal of current trends.”

Affordability, Auto Insurance, Insurers and the Economy, Legal Environment, Regulation

La. Auto Insurance Rates Benefit From Declines
in Frequency, Severity

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By Lewis Nibbelin, Research Writer, Triple-I

More than 20 requests for auto insurance rate decreases have been filed with Louisana’s Department of Insurance by insurers since mid-2025. According to the department, the decreases were driven by reductions in accident frequency and severity.

“I’m glad to see positive movement on auto rates in Louisiana for the first time in years,” said Louisiana Insurance Commissioner Tim Temple. “Because fewer accidents are contributing to these lower losses for insurers, we should not necessarily expect to see this level of decrease in future years unless we continue to pursue legal reform that addresses the foundational reasons our rates are the highest in the country.”

Temple said he hopes for further rate changes as the market continues to stabilize, citing Florida’s recent premium reductions after sweeping tort reform legislation in 2022 and 2023.

Longstanding affordability challenges

Among those who filed for rate decreases include Louisiana’s largest auto insurers, with the latest reductions impacting nearly 470,000 Progressive policyholders, or roughly 23.5 percent of the state’s auto market. More than one million State Farm policies also achieved lower average rates implemented this month.

While the statewide decreases can offer relief for drivers in one of the least affordable states for auto insurance, Temple cautioned that rates for individual policyholders will differ based on personal risk factors, urging consumers to shop among the “30 companies that have taken a rate decrease.”

The announcement arrives less than a year after Louisiana lawmakers passed a 2025 tort reform package to curb excessive lawsuits and a rate of bodily injury claims more than twice the national average. Beyond fueling higher insurance premiums in the state, such practices generate an annual $965 “tort tax” on every Louisianan and cost over 40,562 jobs per year, as highlighted by Triple-I’s consumer awareness campaign to build support for the reforms.

Other 2025 legislative measures, however, stipulate increased regulatory intervention in rate-setting, which can create further strain on an insurance market just beginning to recover. Another bill targeting nuclear verdicts (awards of $10 million or more) also failed to pass, playing a role in the state’s recurring spot on the American Tort Reform Foundation’s annual list of “judicial hellholes.”

Noting that reduced accident frequency contributed to the rate changes, Temple said in a statement that “we should not necessarily expect to see this level of decrease in future years unless we continue to pursue legal reform that addresses the foundational reasons our rates are the highest in the country.”

Lessons from Florida

Measurable benefits from Louisiana’s existing reforms may require a few more years to unfold, Temple added, based on the trajectory of similar legislation in Florida. In 2022, Florida accounted for over 70 percent of the nation’s homeowners claim-related litigation, despite representing only 15 percent of homeowners’ insurance claims, according to the state’s Office of Insurance Regulation (OIR). State legislators responded to the crisis with several tort laws that, among other things, eliminated one-way attorney fees and assignment of benefits (AOB) for property insurance claims.

Under the reforms, 17 new insurance companies have entered the Sunshine State and dozens of homeowners’ and auto insurers have filed for rate decreases, with Citizens Property Insurance – the state’s insurer of last resort – approved for major average rate cuts this spring, according to a recent announcement from Florida Gov. Ron DeSantis.

A 50 percent drop in Citizens policies in 2025 helped facilitate the cuts, reflecting the largest transition of policies back to the private market in a decade. Later that year, additional cost-savings achieved through the reforms helped state regulators secure nearly $1 billion in premium refunds for Progressive auto insurance policyholders in the state.

Though the specific policy levers may differ, Florida’s reforms continue to model the kinds of market improvements that states like Louisiana and Georgia can expect after successfully passing their own tort legislation. State government moves like these are essential to eradicating legal system abuse and keeping insurance affordable and available, especially as legislative challenges to legal reform persist.

“Premiums are lowering because we’ve enacted real reforms and withstood the pressure to reverse course,” DeSantis said. “We will hold firm in our commitment not to go back to the broken insurance market of the past.”

Learn More:

Significant Tort Reform Advances in Louisiana

Florida Governor Touts Auto Insurance Rebates, Tort Reform Success

Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

Louisiana Senator Seeks Resumption of Resilience Investment Program

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

Who’s Financing Legal System Abuse? Louisianans Need to Know

Auto Insurance, Business Insurance, General Liability, Legal Environment

Claims Severity Drives Liability Insurance Losses

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By William Nibbelin, Senior Research Actuary, Triple-I

Economic and social inflation have added a staggering $231.6 billion to $281.2 billion in increased liability insurance losses and Defense and Cost Containment expenses in auto and general liability lines, a new report by Triple-I and the Casualty Actuarial Society.

The study – The Impact of Increasing Inflation on Liability Insurance 2015 – 2024 – says this structural rise in loss costs is amplified by what is broadly identified as legal system abuse.

The dual engine of increasing inflation

The analysis focuses on the total impact of increasing inflation determined through actuarial methods that are unable to decompose the precise contribution of economic inflation versus the role of what Triple-I characterizes as “legal system abuse” — policyholder or plaintiff attorney practices that increase costs and time to settle claims to the detriment of consumers, businesses, and the economy.  These practices include increasing litigiousness, third-party litigation financing, and soaring jury awards.

Claim severity powers losses

Across all lines analyzed, claim severity – not frequency – emerges as the primary driver of the escalating losses in liability lines of insurance. While the number of claims (frequency) has either generally declined or remained below pre-pandemic levels across the study period, the average cost per claim (severity) has soared. In commercial auto liability, for example, frequency has fallen dramatically since the pandemic, yet losses have still increased relentlessly because severity has risen 93.5 percent between 2015 and 2024.

Auto Liability

The report’s traditional focus on auto liability lines continues to show the most significant dollar-based impacts.

  • Personal auto liability: Increasing Inflation added between $91.6 billion and $102.3 billion to losses and DCC for the 2015–2024 period. This represents 8.7 percent  to 9.7 percent of losses and DCC for the period and an increase of 20 percent to 26 percent from the previous analysis on years 2014 through 2023. While the implied compound annual impact is lower than in the commercial sector, the dollar amount is huge due to the line’s immense underlying size. Personal auto severity has accelerated significantly post-2019, nearly tripling its compounded annual growth rate to 10.9 percent from 2019 to 2024. Premiums are only just beginning to rebound from pandemic-era lows, lagging the rise in losses.
  • Commercial Auto Liability: This line continues to sustain higher inflation rates in percentage terms. The total impact of increasing inflation reached $52.0 billion to $70.8 billion (22.6 percent  to 30.8 percent of booked losses). This represents an increase of 22 percent to 27 percent from the previous analysis.

A compelling cross-data set comparison with the Triple-I 2025 report, Review of Motor Vehicle Tort Cases Across the Federal And State Civil Courts, suggests that the “excess value” extracted by motor vehicle tort lawsuits—a clear measure of legal system abuse—was approximately $42.8 billion between 2014 and 2023. This quantitative finding suggests legal system abuse accounts for roughly one-third of the total Increasing Inflation effect in auto liability losses.

General liability lines

This year’s analysis expands to quantify the impact across broader general liability lines for the first time, revealing inflationary rates that are equally, if not more, dramatic in percentage terms.

  • Other Liability – Occurrence: Increasing inflation added between $83.4 billion and $103.3 billion to losses and DCC for the 2015–2024 period. This inflationary problem is comparable in dollar terms to personal auto liability, despite having only about one-third of the loss volume. Its implied annual impact of 3.7 percent on a paid basis is the highest of all the lines studied. Severity in this line grew at a compound annual rate of 6.8% from 2015 to 2024, far outpacing the Consumer Price Index All-Urban (CPI-U).
  • Product Liability – Occurrence: Increasing inflation added between $4.6 billion and $4.8 billion to losses and DCC for the 2015–2024 period. The smallest line examined exhibits the most dramatic severity trend with a compound annual growth rate of 22.3 percent between 2015 and 2024, resulting in a 512.5 percent severity increase overall. The effects appear to be accelerating, with the impact on Accident Year 2024 alone estimated at over 50% of that year’s booked losses.

For the “claims-made” categories of these liability lines (“other liability” and “product liability”), the study was unable to develop credible quantitative estimates due to shifts in business mix, data variability, and the inherent heterogeneity of the underlying risks. However, these lines have certainly not escaped the increasing inflationary environment.

Looking ahead

The data confirms a difficult truth: Even as general consumer price inflation (CPI-U) moderated to 3.0 percent in 2024—a reduction from the 2021-2023 average of 5.6 percent—the loss inflation in liability insurance remains structurally elevated. This means the economic tailwinds that temporarily exacerbated the problem are lessening, but the foundational issues of legal system abuse persist, locking in a higher rate of loss for the foreseeable future.

For consumers and businesses, this translates directly into higher premiums and a greater strain on their financial well-being. The challenge for insurers is the need to adapt to an elevated inflationary environment to effectively manage future liabilities. Recognizing and addressing the pervasive influence of legal system abuse is therefore essential for both managing risk and protecting consumers and businesses from ever-rising costs.

Triple-I continues to foster a research-based conversation around legal system abuse. For an overview of the topic and other helpful resources about its potential impact on insurers, policyholders, and the economy, check out our knowledge hub.

Auto Insurance, Legal Environment, Market Conditions, Regulation

Florida Governor Touts Auto Insurance Rebates, Tort Reform Success

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By Jeff Dunsavage, Senior Research Analyst, Triple-I

Florida Gov. Ron DeSantis announced last week that state regulators have secured nearly $1 billion in premium refunds for Progressive auto insurance policyholders in the state, due to cost savings achieved through litigation reform.

DeSantis, who signed sweeping tort reform legislation bills into law in 2022 and 2023, said the refunds are a direct result of declining litigation expenses in Florida’s auto insurance market.

“Florida was really considered a litigation hellhole by a lot of folks,” DeSantis said. “That contributed to consumers having to bear more costs with respect to auto insurance.”

He pledged Insurance Commissioner Mike Yaworksy is negotiating with other major auto carriers for similar reimbursements to their customers.

Mark Friedlander, Triple-I’s director of communications, told Spectrum News Florida that reduced lawsuit expenses has enabled auto insurers to lower average costs and, in some cases, return premium to customers.

“When you take that out of the equation — all of those abusive lawsuits — this brings down the expenses, and that in turn gets passed along to the consumer,” Friedlander said. “The consumer wins with legal system reform.”

Learn More:

Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

Florida Senate Rejects Legal-Reform Challenge

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 

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

Auto Insurance, Business Insurance, Homeowners Insurance, Industry Financials, Market Conditions, Workers Compensation

Despite Headwinds,
P/C Insurance Industry Maintains Course in 2025

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By William Nibbelin, Senior Research Actuary, Triple-I

The U.S. property/casualty (P/C) insurance industry is on track for a second consecutive year of underwriting profitability in 2025, and is projected to grow faster than the broader U.S. economy, according to the latest Insurance Economics and Underwriting Projections: A Forward View report from Triple-I and Milliman. The report, which is based on data through the first half of 2025, highlights continued progress despite persistent geopolitical and natural catastrophe uncertainties.

Positive Economic Signals and Lingering Concerns

The industry’s economic outlook remains cautiously optimistic. According to Michel Léonard, Ph.D., CBE, chief economist and data scientist at Triple-I, the industry has benefited from stronger-than-expected underlying growth. He also noted that P/C replacement costs continue to rise more slowly than overall inflation.

However, Léonard also pointed to factors that make the outlook for 2026 especially important to watch.

 “Ongoing risks, including tariffs, labor market softening and persistent inflation,” could pose challenges, he said. While the impact of tariffs has been less severe than initially anticipated, their long-term effect remains an open question.

Underwriting Performance: A Mixed Bag

Overall underwriting profitability for 2025 is expected to be a repeat of 2024, but to a lesser degree. The performance gap between personal lines and commercial lines is narrowing.  

“Favorable second-quarter results for homeowners helped narrow the anticipated 2025 gap between personal and commercial lines performance created by the Los Angeles fires in the first quarter,” said Patrick Schmid, Ph.D., Triple-I’s chief insurance officer.

Schmid also noted that personal lines premium growth is expected to remain higher than commercial lines by one point in 2025. That difference is projected to disappear by 2027.

Personal Lines

  • Personal Auto: The personal auto sector continues to be a highlight, with its forecast 2025 Net Combined Ratio (NCR) on track for continued profitability. The forecast has also slightly improved from prior estimates.
  • Homeowners: Despite favorable results in the second quarter, the homeowners’ NCR forecast for 2025 is still expected to be unprofitable for the year.

Commercial Lines

  • General Liability: This continues to be a line of concern. According to Jason B. Kurtz, FCAS, MAAA, a principal and consulting actuary at Milliman, “We see underwriting losses continuing in 2025, with the 2025 net combined ratio for GL forecast at 107.1.” He also said that, while slight improvement is expected in 2026-2027, “we estimate GL combined ratios to remain above 100.” Kurtz added, “Direct incurred loss ratios through mid-2025 have not improved relative to 2024’s poor result. Forecasted net written premium growth of 8.0 percent is 4.8 points above 2024 as premiums respond to recent performance.”
  • Workers Compensation: In contrast to general liability, workers’ compensation remains the strongest-performing major line in the P/C industry. Preliminary 2025 results from NCCI show calendar year combined ratios in the range of 85–93 percent. Donna Glenn, Chief Actuary at NCCI, noted, “If this holds, it will represent 12 consecutive years of combined ratios under 100% for private carriers.” For more details on the preliminary Workers Comp 2025 results, see NCCI’s full analysis in 2025 in Sight, 2024 in Review: The Latest Results for Workers Compensation.

Delving Deeper: A Members-Only View

For members who want to dig deeper into the projections, the full Insurance Economics and Underwriting Projections: A Forward View report offers a more granular analysis, including:

  • A detailed look at personal auto and commercial auto results, breaking down the quarterly experience between auto liability and physical damage.
  • A forecast of net combined ratio and net written premium growth specific to farmowners insurance.
  • A comparison of commercial property sub-lines.
  • A breakdown of commercial multiple peril results, differentiating between property and liability performance.

The next quarterly report will be presented at a members-only webinar in January 2026.

Auto Insurance, Legal Environment

Revealing Hidden Cost
to Consumers of Auto Litigation Inflation

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By William Nibbelin, Senior Research Actuary, Triple-I

Motor vehicle tort cases in federal and state courts generated $42.8 billion in “excess value” from 2014 to 2023, according to new analysis by Triple-I.

“Excess value” may sound like a good thing, but it’s not. It represents an additional cost of motor vehicle civil litigation – above and beyond what it would have been if prior trends in court filings had continued. From 1995 to 2007, filings declined, and from 2007 to 2014 they were flat.

The report illustrates the impact of litigation inflation on insurance premiums for all drivers. It also underscores the challenges related to accurately quantifying and comparing state-by-state experience.

Lawsuits push premium up

As Triple-I has previously reported, litigation trends are a major force driving up auto insurance premiums.  As claims costs rise – whether due to rising repair costs, litigation, or other factors – premiums must increase to ensure that insurers have enough policyholder surplus to pay future, higher claims.

Policyholder surplus is not a nice-to-have extra. It is the money state regulators require insurers to maintain so they will be able to keep their promises to pay policyholders. In addition, credit rating agencies expect insurers to keep even larger surpluses than the states mandate to enable the insurers to borrow at more favorable interest rates when needed.

Interestingly, motor vehicle tort settlement amounts appear to have decreased on average between 2014 and 2023. While actual settlement amounts are not reported, the “amount in controversy” – legalese for the amount demanded by the plaintiff – serves as a proxy for filings disposed as settlements. The average amount in controversy decreased from $748,000 in the first of the three decades under consideration to $674,000 in the third.

However, the increased volume of cases during the period drove the overall excess value to $984.6 million at the federal level alone.

State courts present a challenge

The report estimates that state courts handled approximately 5.0 million motor vehicle tort cases from 2014 to 2023, generating an excess value of $41.8 billion – dwarfing the federal court impact. This analysis, however, is challenged by the state-by-state variety of definitions and criteria for data collection.  

“Because states maintain different definitions and criteria for data collection, most state civil case data is either unavailable or incomplete,” the report says.

The report concludes that its findings align with previous research by Triple-I and the Casualty Actuarial Society, which quantified increasing inflation on auto liability insurance at $118.9 billion for 2014-2023, representing both litigation and economic inflation.

“As we continue to analyze the evolving landscape of motor vehicle litigation, it’s clear that a deeper, data-driven understanding of both national and state trends is crucial,” said Patrick Schmid, Triple-I’s chief insurance officer. “Only with more transparent and comprehensive data can we craft effective solutions that benefit both policyholders and the broader insurance market. Future research should focus on bridging the gaps in state-level information and exploring the causal factors behind rising litigation and its impacts.”

Learn More:

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

Auto Premium Growth Slows as Policyholders Shop Around, Study Says

Florida Bills Would Reverse Progress on Costly Legal System Abuse

Personal Auto Shines, General Liability Faces Headwinds in Q3 2025

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

Georgia Targets Legal System Abuse

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

Despite Fewer Claims, Personal Auto Insurance Payouts Increase

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

Auto Premium Growth Slows As Policyholders Shop Around, Study Says

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Improved loss ratios, strong premium growth, and lower retention rates characterized the U.S. auto insurance industry in 2024, according to LexisNexis® Risk Solutions’ 2025 U.S Auto Insurance Trends Report.

The report shows that, “while a number of insurers returned to profitability as the market softened,” the market was characterized by “record levels of policy shopping and switching, attorney representation, claims severity, and rising driving violations.”

Rate increases over the past two years helped U.S. insurers address profitability issues, the report said. Premium rate increases are beginning to ease, rising 10 percent in 2024, compared with a 15 percent hike in 2023, as market conditions soften. Insurer profitability is improving, with direct written premiums growing 13.6 percent, to $359 billion, and incurred loss ratios stabilizing, enabling some carriers to pursue growth strategies and file for rate decreases.

LexisNexis Risk Solutions also notes that tariffs may factor into how insurers consider rate in 2025.  While the market wouldn’t expect the magnitude of activity seen between 2022 through 2024, tariffs, if they stick, could set off a ripple effect of moderate rate increases with implications across the industry.

Other trends identified in the report include:

  • Bodily injury claims severity jumped 9.2 percent, and property damage severity climbed 2.5 percent, year over year. In contrast, collision severity fell 2.5 percent for the same period.
  • All driving violations increased 17percent and driving violation rates across the United States surpassed 2019 levels.
  • Policy shopping reached an all-time high, with more than 45 percent of policies in force shopped at least once by year-end.

The report also noted that electric vehicle (EV) transitions are introducing new risks, as drivers moving from internal combustion engine vehicles to EVs experienced a 14 percet rise in claim frequency.

“Auto insurers continue to navigate a dynamic market,” said Jeff Batiste, senior vice president and general manager, U.S. auto and home insurance, LexisNexis Risk Solutions. “The combination of the market softening and a return to profitability presents a potential new chapter for the industry as insurers encounter a consumer base that is more willing than ever to shop for deals.”

Record levels of auto policy switching translated to 2024’s new policy growth rate of 17.7 percent year over year. It also added momentum to the ongoing customer retention decline across the industry.

Since 2021, retention has decreased five percentage points, to 78 percent, resulting in a 22 percent increase in policy churn, the report says.

“Historically, dropping even one percentage point is significant,” it says. “However, against a backdrop of heightened levels of shopping and switching activity, insurers may want to focus on their retention strategies, especially when long-tenured customers are hitting the market.”

Learn More:

Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

Personal Auto Shines, General Liability Faces Headwinds in Q3 2025

Personal Auto 2024 Underwriting Results Best Since Pandemic

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

New IRC Report: Personal Auto Insurance State Regulation Systems

Auto Insurance, Highway Safety, Technology

Parents Eye IoT
to Address Perils
of Teen Driving

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Parents are increasingly open to using technology to keep their teen drivers safe on the road, a recent survey from Nationwide finds.

The survey found 4 out of 5 parents would enroll their teens in telematics programs that reward safe driving. This enthusiasm for tech-based solutions comes despite mixed parental assessments of their teens’ driving abilities: While 42 percent rate their teen’s driving as “good” or “excellent”, similar percentages express concerns about distracted driving and reckless behavior.

“Parents want to feel confident that their teens are making smart choices behind the wheel,” says Casey Kempton, Nationwide president of P&C personal lines. “These tools help make that possible—not just by monitoring behavior, but by encouraging better habits through positive reinforcement.”  

Despite recognizing the value of safety technology, adoption remains limited. While 96 percent of parents said they believe dashcams provide valuable evidence after accidents, only 26 percent of teen drivers actually have them installed.

The survey reveals a broader trend in which consumers are drawn to telematics and monitoring technologies, though motivations vary. While parents prioritize safety benefits, many consumers are equally interested in the insurance premium discounts these programs can provide.

“This isn’t just about technology,” Kempton says. “It’s about creating a culture of accountability and shared responsibility on the road.”  

As comfort with AI-enabled monitoring grows, it appears that families are embracing a future in which technology supports — but does not replace — good judgment.  

Learn More:

IoT Solutions Offer Homeowners, Insurers Value — But How Much?

How Insurers Address Talent Gap Through Innovation & Technology

JIF 2025 “Risk Takes”: Data Solutions for Today’s Challenges

Insurtech Funding Hits Seven-Year Low, Despite AI Growth

Auto Insurance, Industry Financials, Market Conditions

Personal Auto Shines, General Liability Faces Headwinds in Q3 2025

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By William Nibbelin, Senior Research Actuary, Triple-I

The U.S. property/casualty (P/C) insurance industry is entering the latter half of 2025 with a nuanced underwriting landscape, as revealed in the latest “Insurance Economics and Underwriting Projections: A Forward View” report from Triple-I and Milliman. While personal auto continues to be a strong performer, the general liability sector is grappling with persistent profitability concerns.

Industrywide Trends

The overall industrywide net combined ratio (NCR) for 2025 is forecast at 99.3, a 2.7-point increase from 2024. Despite some line-specific challenges, a broader return to profitability is anticipated in 2026. The overall Net Written Premium (NWP) growth rate for 2025 is projected to be 6.8 percent, a decrease of 2.0 points from 2024, marking the lowest growth since 2020. Personal lines growth is expected to outpace commercial lines by 1.5 percentage points in 2025, though this gap is predicted to narrow by 2027.

Economic Influences

Michel Léonard, Ph.D., CBE, chief economist and data scientist at Triple-I, highlighted the resilience of the U.S. economy and the P&C industry amidst tariffs and trade uncertainty.

“The insurance industry’s economic growth drivers continue to outperform overall U.S. GDP growth,” he stated. However, Léonard cautioned that revised economic data for the first half of the year might paint a weaker picture of the U.S. economy, potentially leading to more widespread concerns of contraction or even recession heading into the fall.

He also noted, “With inventories running low, their depletion will now accelerate inflation and slow growth for the rest of the year.”

Léonard pointed out that price increases due to tariffs and other economic factors have been most severe for personal auto, with used car and truck prices increasing by 7.7 percent in the first half of this year. The P&C industry typically lags the broader economy by one to two quarters, suggesting that a potential broader economic contraction could impact the industry starting in Q1 or Q2 of 2026.

Personal Lines Underwriting Performance

Personal auto continues to be a robust area, with a forecast 2025 NCR of 96.0. This is approximately 1 point higher than 2024, but the line remains on track for continued profitability.

Homeowners insurance, however, faced significant challenges in Q1 2025 due to the Los Angeles wildfires earlier this year. The Q1 2025 Loss Ratio for homeowners was the worst first-quarter experienced in over 15 years and the worst of any quarter since Q2 2011.

Commercial Lines Underwriting Performance

Jason B. Kurtz, FCAS, MAAA, a principal and consulting actuary at Milliman, noted that commercial auto is forecast to remain unprofitable from 2025 to 2027, despite an estimated double-digit NWP growth in 2025.

Commercial Property with a forecast 2025 NCR of 88.3 remains profitable while 5.5 points over 2024. Strong premium growth from 2021 through 2023 contributed to profitability in the two most recent years, but there’s been a significant slowdown with premiums growing just 4.2 percent for Q1 2025. Commercial Multi-Peril swung to profitability in 2024 after combined ratios above 100 dating back to 2016. However, poor Q1 2025 results are driving a forecast 2025 Net Combined Ratio of 101.0.

The general liability line continues to be a source of profitability concern. The Q1 2025 General Liability Loss Ratio was the second worst first quarter in more than 15 years, showing less than a 1-point improvement from Q1 2024. For general liability, he stated, “the NCR is expected to improve in 2026-2027 but remain unprofitable. It is worrisome that the 1st quarter 2025 direct incurred loss ratio was only marginally improved relative to the 1st quarter of 2024, and that these two results are the highest first quarter loss ratios in more than 15 years. On a positive note, premium growth does appear to be picking up.”

In contrast, workers compensation continues its strong performance. Kurtz highlighted that the forecasted 2025 NCR of 90.6 represents a 1.0-point improvement from prior estimates, as the Q1 2025 Loss Ratio was the lowest in over 15 years. Stephen Cooper, Executive Director and Senior Economist at the National Council on Compensation Insurance (NCCI), commented on the labor market’s impact, stating, “While employment has been concentrated amongst fewer industries, the labor market has shown resilience and continued strong payroll growth for workers compensation.”

He also added, “With economic uncertainty elevated and recession concerns resurfacing, consumer behavior will be important to watch.”

*Note: Insurance Economics and Underwriting Projections: A Forward View is a quarterly report available exclusively to Triple-I members and Milliman customers.