Category Archives: Insurers and the Economy

Insurers and the Economy, Legal Environment

North Carolina Becomes First State to Ban Third-Party Litigation Funding

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By Lewis Nibbelin, Research Writer, Triple-I

North Carolina has enacted a measure to ban third-party litigation funding, the first of its kind in the country amid nationwide efforts to rein in the practice.

Signed into law on Monday after near-unanimous support in the state legislature, the Prohibit Litigation Investments Act makes it “unlawful for a person to engage in litigation investment” or “to furnish litigation investment to a party or counsel of record in a civil proceeding” in the state. Exclusions to the law include contingency-fee arrangements, insurer indemnification or defense obligations, pro bono funding from nonprofit organizations, and other forms of financing not contingent on suit outcomes.

“For too long, dark money has supported the legal system abuse tactics of billboard attorneys, funding an excessive volume of lawsuits through largely undisclosed arrangements,” said Triple-I CEO Sean Kevelighan. “Greater transparency helps shine a light on these financial interests and addresses practices that can contribute to legal system abuse, drive up claim costs, and ultimately increase insurance premiums for consumers and businesses.”

TPLF occurs when outside investors profit from lawsuits by paying legal costs in exchange for a share of the settlement or judgment if the suit wins. In practice, this encourages prolonged and unnecessary cases and can culminate in extreme nuclear verdicts of $10 million or more. TPLF contributes to the $6,664 in added annual costs for the average American household through excess litigation.

States diverge on nonlawyer involvement

North Carolina’s new law is the latest in a wave of TPLF-related legislation building on a record number of bills introduced nationally last year to improve TPLF transparency. While many states have continued to focus on disclosure, some are targeting alternative business structures and nonlawyer-owned law firms as sources of undue courtroom friction.

Colorado, for instance, recently passed a law that prohibits legal fee or revenue sharing with outside investors and increases restrictions on ownership. Both it and a 2025 measure regulating foreign TPLF agreements were backed by a coalition that included the Colorado Trial Lawyers Association, a partnership the organization explained is aligned with their shared interest in upholding the integrity of the legal system.

Similar bills are moving through the California and Illinois state legislatures, each of which have also received support from several state bar associations. Triple-I expanded its legal system awareness campaign in both states earlier this year to help demonstrate the link between their insurance affordability struggles and legal system abuse.

Emerging challenges to nonlawyer ownership and investments contrast from regulatory changes in recent years that expanded these practices in some states. In 2020, Utah launched the nation’s first regulatory “sandbox” permitting nontraditional legal service providers who operate under the supervision of the state supreme court, including firms invested in and/or owned by nonlawyers. That same year, Arizona repealed its rule barring nonlawyer fee sharing and ownership, later unveiling its own program in 2021 to facilitate alternative business structure arrangements.

As policymakers seek ways to protect consumers from rising costs, it’s important to learn from states that are succeeding. Florida has a long history of problems caused by insurance fraud and litigation abuse that contributed to upward pressure on insurance rates. Recent reforms to check these practices have made the Sunshine State a national model for the kinds of market improvements states can expect through tort legislation.

By limiting third-party investor influence in litigation, North Carolina and Colorado may soon serve as additional blueprints to address the root causes of rising costs, rather than merely treating the symptoms.

Learn More:

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States Take the Lead on Third-Party Litigation Funding Reform

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Affordability, Homeowners Insurance, Insurers and the Economy, Legal Environment, Roof Condition, Severe Convective Storm

Storms, Inflation, Fraud Fuel Rising Homeowners Rates for Oklahomans

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By Jeff Dunsavage, Head of Research Publications and Insights, Triple-I

Oklahoma homeowners insurance premiums are escalating due to a range of factors. A new Triple-I Policy Brief discusses the drivers of this trend and cautions state legislators to make sure any attempts to contain these rising costs target its underlying causes.

“Because insurance is integral to the total cost of homeownership, lawmakers often find themselves under pressure from constituents to rein in premiums,” the brief says. “Unfortunately, their efforts often lead to policies that would hurt consumers, rather than help them. It is important for policymakers to understand the causes of premium increases and to let that understanding inform decision making.”

Oklahoma is among the least affordable states for home insurance coverage (ranked 48th, with 3.45% of household income spent), according to data from the Insurance Research Council (IRC). IRC, like Triple-I, is an affiliate of The Institutes.

Rising costs of materials and labor to repair and replace damaged or lost property have been major drivers of increasing premium rates. Legal system abuse and claims fraud also play a substantial role in rising rates nationally. Roof replacement fraud is a rapidly worsening problem nationally, according to the National Insurance Crime Bureau (NICB), and the Oklahoma attorney general’s office has called roofing scams “the most common complaint submitted by consumers.”

Following particularly severe weather in April, the attorney general warned Oklahomans to be vigilant of contractor fraud.

“In the aftermath of severe weather, scammers often target vulnerable homeowners trying to recover and rebuild,” said Attorney General Gentner Drummond. “While it is natural to want to make repairs quickly, taking the time to choose a reputable contractor is critical to protecting your home and finances.”

While it may be politically tempting to address a state’s affordability issues by imposing more regulatory constraints on insurers Triple-I warns that states that have tried such approaches have shown they are neither effective nor sustainable.

For Oklahoma, addressing the severity of weather-related claims is key to moderating rate increases. Risk management programs like Strengthen Oklahoma Homes – which provides grants to Oklahoma residents for residential wind and hail mitigation on new and existing, owner-occupied, primary residence single-family homes – is a great start. Modeling the success of the Strengthen Alabama Homes initiative, funding for Oklahoma’s program comes from the insurance industry and is not funded by the state’s general budget.

“The property/casualty insurance industry is an essential partner in addressing states’ affordability crises,” the Triple-I brief says. “States that work with the industry can expect more effective, more sustainable results than those that only attack the symptoms instead of the underlying cost drivers.”

Learn More:

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Legal System Abuse Awareness Campaign Spreads Across U.S.

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Mississippi Set to Launch Roof Grant Program

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Disasters, Litigation Reshape Homeowners’ Insurance Affordability

Affordability, Auto Insurance, Highway Safety, Insurers and the Economy, Legal Environment, Technology

Clarifying Drivers of Rising Auto Premiums

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By Lewis Nibbelin, Research Writer, Triple-I

Personal auto insurance premiums represent multiple aspects of the affordability crisis U.S. consumers face today, and a panel discussion at the Brookings Center on Regulation and Markets this week helped define and clarify them.

Panel moderator Aaron Klein, Miriam K. Carliner Chair and senior fellow in Economic Studies at the Brookings Institution, began the discussion by acknowledging “the rising rates of car insurance are part of the broader set of topics that have been given the term ‘affordability.’”

Representing insurers, regulators, and consumers, the panelists included Sean Kevelighan, CEO of Triple-I; Justin Zimmerman, a former commissioner in New Jersey’s Department of Banking and Insurance; and Chuck Bell, programs director for advocacy at Consumer Reports.

All agreed that much of the blame for rising rates can be attributed to external factors such as the costs associated with safer, more technologically sophisticated vehicles, thereby raising the costs to repair and replace them. Inflation has exacerbated these impacts, with auto replacement costs up 28 percent from 2021 to 2025. Over the past 12 months, inflation increased 4.2 percent, thanks in large part to geopolitical risks, supply-chain disruptions, and rising oil prices.

Disagreement surfaced, however, around the degree of insurance-industry responsibility for insurance costs. Consumer Reports’ Chuck Bell suggested the $14 billion insurers issued in rebates to consumers during the COVID-19 pandemic was insufficient, prompting Kevelighan to point out that, “of all the refunds being given, you saw the most coming out of the insurance business and community.” Zimmerman noted that many states also froze insurers’ ability to raise rates during the pandemic, leading to some post-pandemic “rate catch-up.”

Rampant legal system abuse helps fuel the strain. While derided as a concept by some, Kevelighan cited analysis from Triple-I and the Casualty Actuarial Society that indicates excessive litigation added up to $281.2 billion in increased liability insurance losses from 2015 to 2024 – a finding that economic inflation alone cannot explain. A separate Triple-I report on civil case filings indicated roughly one-third of increasing inflation in auto liability losses stemmed from these legal trends.

Kevelighan also highlighted the $380 million spent by third-party litigation funders (TPLF) on online advertising last year, according to a study from the National Insurance Crime Bureau and 4WARN. Now “a global multi-billion-dollar asset class,” TPLF has become a target for reform in a growing number of states, notably New York.

New York affordability struggles

Wiping out billions of dollars in U.S. economic activity annually, legal system abuse costs New York residents 427,794 jobs and $7,027 per household per year, contributing to the fourth-highest auto insurance expenditures in the nation, Triple-I estimates. Moreover, the state’s average personal auto injury claim is $46,726, at more than twice the national average.

Building on legislation to tackle TPLF, New York lawmakers recently passed a package of auto insurance reform bills to disincentivize legal system abuse and fraud, one of which will introduce a $100,000 cap on noneconomic damages for drivers who were at fault, uninsured, or impaired at the time of an accident. Comparative negligence rules were also updated to ensure costs cannot be shifted away from the motorists responsible for an accident.

Kaitlin Asrow, New York State’s acting superintendent for the Department of Financial Services, told Klein in an interview before the panel, “Over the last five years, suspicious fraud reports for just no-fault auto increased 80 percent.” She added that “staged accidents were up 34 percent” in New York City alone during the same period.

While further reforms are needed to address the Empire State’s high insurance costs, Kevelighan pointed out that similar efforts in Florida have begun to drive substantial premium reductions and renewed private market competition.

Modifying behavior for risk reduction

Though many influences on insurance costs are structural, Kevelighan emphasized “a lot of this comes down to our behaviors and how we’re driving and living.” As such, insurance must shift from “a once or twice a year type of transaction” to “an open and ongoing conversation” between insurers and their customers.

Part of that conversation revolves around distracted driving, which jumped significantly after the onset of the COVID-19 pandemic and remains at elevated levels. As measured by a recent Nationwide survey, seven in ten commercial drivers have reported experiencing increased distraction as well as reckless driving from other drivers, at a 10-point increase from 2025.

Nationwide also found that commercial auto loss ratios drop by at least 30 percent when policyholders use telematics, a technology that monitors mileage, braking and acceleration, and other driving patterns to provide real-time feedback that can adjust unsafe behavior. In addition, built-in accident-avoidance systems are reducing rear-end collisions by 40 to 50 percent.

Noting telematics research is still in its early stages, Kevelighan said the “interaction and exchange” of risk information between insurers and policyholders “is where the industry is going to start shifting from just detecting and repairing after a catastrophe to predicting and preventing.”

“We’ve got to make sure we’re balancing out what it is that we’re doing to reduce our risk, because that’s the real driver,” Kevelighan explained. “When we reduce the risk, we can reduce the cost.”

Learn More:

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New York Among Least Affordable States for Auto Insurance

Triple-I Testifies on New York Insurance Affordability

Revealing Hidden Cost to Consumers of Auto Litigation Inflation

Business Risk, Cyber Risk, Flood Insurance, Floods, Insurers and the Economy

RiskScan 2026 Reveals A More Interconnected Risk Landscape

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By Lewis Nibbelin, Research Writer, Triple-I

Organizations across the insurance value chain are navigating an increasingly complex risk landscape, demanding more integrated approaches to resilience shared among all segments of the property/casualty (P/C) market, according to RiskScan 2026, a new research study from Munich Re US and Triple-I.

Based on survey data from more than 1,700 participants in the United States and United Kingdom, RiskScan 2026 explores risk perceptions and exposures across five key market segments: 

  • P/C insurance carriers,
  • P/C agents and brokers,
  • Middle-market decision makers,
  • Small-business owners, and
  • consumers.

Comprising two in-depth reports, the study builds on the previous RiskScan 2024 and features a new report highlighting global specialty market perspectives and insights.

Across all audiences, cyber incidents, economic pressures, and AI emerged as chief concerns, indicating insurers and their customers are largely aligned on risks reshaping the market. Increasing frequency and severity of natural catastrophes also ranked high, particularly for perils traditionally associated with less catastrophic loss, such as wildfires, flooding, and severe convective storms.

“The real challenge – and opportunity – is in understanding how these forces intersect,” said Sabrina Hart, president and CEO of Munich Re Specialty North America. “A cyber event can trigger operational disruption, a climate event can cascade through supply chains, and legal inflation can magnify losses well beyond the initial event.”

Growing consumer awareness

While knowledge gaps remain, policyholders are becoming more aware of these connections. Consumers and businesses who participated in the 2024 survey, for instance, primarily did not identify legal system abuse as an insurance cost driver – a trend middle-market decision makers and small business owners reversed in the updated study.

Such responses suggest industry stakeholders increasingly recognize the long-term impacts of risks, rather than focus on the short-term disruptions of individual events. Economic conditions play a leading role in this shift as “a multiplier of insurance risk, affecting affordability, claims severity, capital allocation, and long-term market stability across the insurance value chain,” explained Michel Léonard, Triple-I’s chief economist and data scientist.

Flood and cyber take-up still low

Despite growing awareness, consumers continued to express less concern about flood than insurance professionals and businesses, in part reflecting misconceptions about flood risk and policy exclusions and limitations. Many consumers as well as small business owners are unaware that homeowners’ and commercial property insurance do not typically cover flood damage. Consumers may also believe flood coverage is unnecessary unless their mortgage lenders require it or drop their flood insurance coverage once their mortgage is paid off to save money.

Similarly, though all market segments considered cyber incidents a significant concern, the report notes that cyber take-up rates in the small commercial and personal line spaces remain low. Misunderstandings surrounding cyber risk coverage options and benefits help fuel this discrepancy, revealing a gap between insurer perceptions of product value and that of their customers.

“The protection gaps highlighted in this research underscore the urgent need to better educate consumers and businesses,” said Triple-I CEO Sean Kevelighan. “As flood, cyber, and other interconnected exposures continue to evolve, the industry has an important opportunity to strengthen public understanding, close protection gaps, and work collaboratively with consumers, policymakers, businesses, and communities to better predict, prepare, and prevent ever increasing risks.”

Learn More:

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Cyber Claim Severity Surges as AI, Litigation Accelerate Risk

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Inflation, Replacement Costs, Climate Losses Shape Homeowners’ Insurance Options

As Global Risks Evolve, So Must Insurance

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

U.S. P/C Market Records Hard-Earned Decade-Low Combined Ratio

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By William Nibbelin, Head of Industry Data and Actuarial Science, Triple-I 

After years of significant financial strain, the U.S. property/casualty (P/C) insurance industry is showing strong signs of recovery and stabilization. According to the latest Insurance Economics and Underwriting Projections: A Forward View report from Triple-I and Milliman, the industry’s net combined ratio (NCR) reached its lowest level in more than a decade in 2025, reflecting improved underwriting conditions as the sector navigates the tail-end of post-pandemic economic volatility and hyperinflation.

Economic Outlook

While the industry maintains demonstrated resilience, the economic environment signals greater uncertainty. Real GDP growth slowed to 2.0 percent in the first quarter of 2026, while inflation remained above the Federal Reserve’s target at 3.3 percent in March. Triple-I Chief Economist and Data Scientist Michel Léonard, Ph.D., CBE, emphasized the cost drivers behind these results, explaining they “should be viewed in the context of the significant financial strain insurers have faced in recent years.”

“Although conditions have stabilized somewhat, insurers continue to operate in an environment marked by elevated catastrophe risk, higher claims severity, and ongoing economic uncertainty,” Léonard said. “Insurance employment declined 1.8 percent year over year in March, underperforming the broader labor market and reflecting continued weakness in sector employment conditions. Meanwhile, higher energy prices and persistent inflationary pressures continue to strain household and business finances.”

A critical factor for future growth is monetary policy. Forecasts for 2027 and 2028 hinge on the Federal Reserve’s interest rate decisions, with a holding pattern currently in place as the market monitors unemployment rates as a barometer for potential rate cuts.

Personal Lines Underwriting Results

The 2025 recovery was most visible in personal lines, which achieved a dramatic turnaround from supply chain-driven losses following the pandemic.

  • Personal Auto: This segment reported a 2025 NCR of 91.8, a 3.5-point improvement from 2024. Net written premium growth slowed to 4.0 percent, its lowest level since 2021.
  • Homeowners: Despite an active catastrophe year, including the Los Angeles wildfires in the first quarter, underwriting performance improved significantly. The 2025 NCR of 88.1 was the lowest in over a decade, aided by easing replacement cost pressures and prior pricing discipline.

Commercial Lines Underwriting Results

While property lines flourished, certain commercial lines face ongoing challenges:

  • Commercial Auto and General Liability: These are the only major lines with an NCR above 100 in 2025. Jason B. Kurtz, FCAS, MAAA, principal and consulting actuary at Milliman, explained that “litigation pressures and claims severity trends continue to result in elevated loss costs, constraining improvement in these segments despite broader industry strength.”
  • Workers’ Compensation: This line remains a pillar of stability, with projected combined ratios in the low 90s through 2028. For 2025, the preliminary combined ratio is 91, at  “an increase of about 5 points from the prior year,” said Donna Glenn, chief actuary at the National Council on Compensation Insurance (NCCI). Glenn added this change “is primarily due to an increase in the loss and underwriting expense ratios.”

Forward View

Underlying P/C growth for the first half of 2026 is forecast at -3.7 percent, a significant dip from the 1.6 percent growth in 2025. A recovery is anticipated beginning in 2027.

Replacement costs are a primary area of concern for long-term pricing. Triple-I Chief Insurance Officer Patrick Schmid, Ph.D., noted, “replacement costs moderated significantly from their 2022 peak, but our forecasts show them re-accelerating through 2028 and eventually outpacing overall U.S. inflation.”

While property lines have strengthened, Schmid cautioned that “the industry faces a challenging road ahead with elevated catastrophe exposure, economic uncertainty, and persistent claims-cost pressures.”

New Deep-Dive Resource

To provide members with more granular insights, Triple-I has launched State of the Line Issues Briefs, a monthly series focusing on the nuances of individual segments. These deep dives are designed to help members navigate specific strategic planning challenges beyond high-level quarterly forecasts. In an addendum to the briefing, Triple-I shared key findings from these reports.

For the farmowners’ line, analysis revealed the producer price index for commercial machinery repair acts as a high-correlation leading indicator for premium changes. Additionally, a major structural shift was identified in fire and allied lines, where the standard market share dropped from 66.7 percent in 2016 to just 52.7 percent in 2024, as premiums migrated toward the excess and surplus and residual markets.

Cyber Risk, Insurers and the Economy, Legal Environment, Technology

Cyber Claim Severity Surges as AI, Litigation Accelerate Risk

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By Lewis Nibbelin, Research Writer, Triple-I

Despite a 34 percent decline in cyber insurance claim frequency for large U.S. businesses in 2025, average claim severity doubled to more than $4.4 million, according to Chubb’s 2026 Cyber Claims Report. Though AI-driven detection systems helped stabilize claim frequency across several global markets, advanced cyberattacks – alongside liability litigation challenges – ranked among the top cost drivers.

Drawing on historical claims data, the report explained how bad actors have begun leveraging AI for increasingly sophisticated attacks capable of “compromising multiple systems in a matter of minutes,” including large-scale incidents that involve minimal human oversight. Data-breach claims alone exceeded a historic $10.2 million in the U.S., propelled in part by the outsized impact of individual ransomware encounters.

Becoming faster and more difficult to detect, ransomware incidents can propagate across multiple businesses along a supply chain with just one attack, especially as markets become more globally interconnected. One such event in the U.K. led to roughly $568 million in losses for the targeted company but a $1.4 billion loss for the entire supply chain as manufacturing “halted for five weeks across sites in the U.K., Slovakia, Brazil, and China.” Over 5,000 U.K organizations in total were affected, Chubb said.

Consequences of cyber incidents extend beyond these losses, the report noted, as incidents increasingly escalate to legal action, often within days and “irrespective of the size of the entity or any controls perceived to be lacking.” Federal legislation enacted in 1988 to protect physical video privacy has helped lead the trend, as plaintiff attorneys continue to reinterpret the law to apply to modern streaming and social media platforms.

Similar applications of a 1967 statute in California – originally intended to prevent wiretapping – now target businesses that use website technologies such as cookies and tracking pixels, generating thousands of lawsuits in recent years. A bill that would remove these prohibitions for businesses has garnered strong bipartisan support, though faces an uncertain future after stalling in the state legislature last year.

“At a time when affordability is already one of California’s greatest challenges, these lawsuits are quietly making life more expensive for everyone,” wrote Scott Miller, president and CEO of the Fresno Chamber of Commerce, for The Fresno Bee. “[SB 690] would restore balance, reduce abusive litigation, and allow small businesses to focus on serving their customers, not defending against opportunistic lawsuits.”

A “growing body of privacy laws” are further “imposing complex, layered obligations for companies that store and/or transfer personal data,” Chubb reported, highlighting new laws in Indiana and Kentucky aimed at implementing stricter opt-in mechanisms for personal information. Companies may struggle to navigate these emerging regulations as privacy and cyber risks continue to evolve, creating compliance concerns and potentially exacerbating losses and broader supply-chain disruptions when cyberattacks occur.

Investing in threat detection, AI governance, and employee cybersecurity education are among the many ways organizations can boost their cyber resilience. A separate Chubb survey also suggests interest in cyber insurance to mitigate these risks is rising. Leaders across lower, core, and upper middle market segments identified cybersecurity and advancing technology as their chief risk concerns, with 47 percent of respondents indicating they were considering adding or increasing cyber coverage.

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As Global Risks Evolve, So Must Insurance

Executive Exchange: Insuring AI-Related Risks

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

Illinois Bill Would Hurt Insurers and Customers

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By Jeff Dunsavage, Head of Research Publications and Insights

Senate Bill 1486 – currently moving through the Illinois General Assembly – would unnecessarily burden insurers and hurt the customers it is intended to protect.

“The measure would add new regulatory layers that could impede the accurate pricing of risk while doing nothing to address the underlying causes of rising premiums,” Triple-I said in a recently published Policy Brief. “Premiums are increasing at different rates across the country, reflecting a mix of factors that include climate events, shifting populations, rising costs to repair and replace property, and legal system abuse.”

All these factors drive up the number and the cost of claims and, if not properly addressed, could erode the policyholder surplus insurers are required to keep on hand to pay claims. If surplus declines below levels mandated by regulators, insurers must raise rates or rethink their appetite for writing coverage in riskier states.

Neither option is good for consumers.

If affordability is the goal, the most effective path is cost reduction. Illinois leaders should model the behavior of states that are addressing the root causes of rising insurance premiums – not just treating the symptoms.

The brief also points out that both homeowners’ and personal auto insurance in Illinois is more affordable than the U.S. average, when measured as a ratio of average insurance expenditures to median household income.

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Illinois Lawmakers Reject Risk-Based Pricing Challenge

New Illinois Bills Would Harm — Not Help — Auto Policyholders

Affordability, Insurers and the Economy, Legal Environment

States Take the Lead on Third-Party Litigation Funding Reform

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By Lewis Nibbelin, Research Writer, Triple-I

The Louisiana Department of Insurance’s new partnership to combat marketing tactics tied to third-party litigation funding (TPLF) is only the latest in a wave of state efforts to limit the practice across the country.

TPLF occurs when outside investors profit from lawsuits by paying for legal costs in exchange for a share of the settlement or judgement if the suit wins. In practice, this incentivizes prolonged and unnecessary cases and can culminate in extreme nuclear verdicts of $10 million or more.

By partnering with the National Insurance Crime Bureau (NICB) and digital intelligence company 4WARN to investigate and raise awareness of these practices, the Louisiana department aims to shield the public “from opportunists who manipulate the claims process to fuel excessive litigation, which is a primary driver of our high insurance costs,” said Insurance Commissioner Tim Temple.

A joint study from NICB and 4WARN reveals that third parties invested an estimated $380 million into online search ads from June 2024 to June 2025, attracting 27.8 million clicks to TPLF-hosted websites in June of last year alone. Some mislead policyholders into believing they are communicating with their insurer to escalate disputes before they talk to the insurance company, the Louisiana insurance department said, reflecting a coordinated online claimant recruitment system designed to promote legal system abuse.

Beyond inflating insurance premiums, TPLF costs each U.S. household more than $600 annually, at $192.79 per individual, in lost earnings and purchasing power, according to a report from the Perryman Group and Citizens Against Lawsuit Abuse. Another finding suggests direct annual losses associated with TPLF total $35.8 billion as of 2024.

A growing trend

Legislation targeting TPLF reached a record nationwide high last year, including within a package of Georgia reforms that, among other things, requires litigation financiers to register with the state Department of Banking and Finance and prohibits them from influencing case outcomes, such as by making decisions related to settlements or counsel selection. In the wake of these reforms, the Peach State has welcomed a trend of major auto insurance rate reductions and unprecedented dividends for thousands of drivers.

More recently, a new Mississippi law that takes effect July 1 will mandate disclosure of foreign litigation funding to prevent foreign entities from exploiting the U.S. legal system for sensitive information. Utah passed its own bill in March, introducing comparable restrictions.

Legislation that passed a Michigan House committee earlier this month would bar foreign TPLF altogether, as well as require disclosure and registration of all funders in TPLF-backed cases. Similar bans on foreign TPLF have been proposed in Missouri, Tennessee, and Ohio, with bills in the latter two states both passing their state Houses.

Louisiana lawmakers have also introduced legislation to increase TPLF transparency, building on the state’s 2024 law introducing some oversight of foreign TPLF. The proposed bill would further require attorneys to disclose TPLF contracts either within 30 days of being retained as counsel or 30 days of entering a funding agreement, depending on whichever action comes first. Though the bill failed to receive a vote in the state’s previous legislative session, it continues to garner strong bipartisan support.

While Louisiana’s overall premium rates declined in 2025, including a 5.8 percent average decrease in auto premiums, Temple noted in a separate 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.”

Learn More:

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Reining in Third-Party Litigation Funding Gains Traction Nationwide

Significant Tort Reform Advances in Louisiana

Georgia Targets Legal System Abuse

Disaster Preparedness, Disaster Resilience, Insurers and the Economy, Risk Management

Welcome Back, BRIC

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By Jeff Dunsavage, Head of Research Publications and Insights, Triple-I

The restoration of FEMA’s Building Resilient Infrastructure and Communities (BRIC) program after its sudden cancellation a year ago is good news for communities that will benefit from the program.

Congress established BRIC through the Disaster Recovery Reform Act of 2018 to ensure a stable funding source to support mitigation projects annually. Before its cancellation on April 4, 2025, the program had allocated more than $5 billion for investment in mitigation projects to alleviate human suffering and avoid economic losses from floods, wildfires, and other disasters.

At the time the program was cancelled, Chad Berginnis, executive director of the Association of State Floodplain Managers (ASFPM), was critical of the decision.

 “Although ASFPM has had some qualms about how FEMA’s BRIC program was implemented, it was still a cornerstone of our nation’s hazard mitigation strategy, and the agency has worked to make improvements each year,” Berginnis said.

A coalition of 23 states challenged the cancellation and secured a court order requiring FEMA to restore billions in funding to communities that rely on the hazard-mitigation program. In a March 6 ruling, a U.S. district judge Richard G. Stearns gave FEMA 21days to unfreeze the approximately $750 million in grants that have been in limbo since the cancellation, which it did on March 31.

Tighter scrutiny

The restored BRIC program is largely the same statutory program, but now it operates under tighter judicial and congressional scrutiny. FEMA also explicitly states that the restored program:

  • Prioritizes infrastructure and construction projects that deliver immediate, measurable risk reduction;
  • Limits capability‑ and capacity‑building activities to those directly tied to infrastructure; and
  • Excludes stand‑alone planning activities not connected to physical mitigation outcomes

“BRIC isn’t a perfect program, but it’s a necessary one,” said Daniel Kaniewski, CEO of Northstar Risk & Resilience, a former FEMA deputy administrator, and a Triple-I non-resident scholar. “It was formed to help drive investment in creating disaster-resilient communities – a very real need.”

Kaniewski drew comparisons with the National Flood Insurance Program (NFIP) “Risk Rating 2.0” reforms, which aligned NFIP premiums more closely with the risk characteristics of insured properties. Before the reforms, lower-risk property owners frequently subsidized the coverage of higher-risk homes. Risk Rating 2.0 made rates fairer and the program more fiscally sound. But further reforms to NFIP are necessary, just as BRIC may need to be updated based on lessons learned from the first few years of the program’s implementation. 

Kaniewski offered a final caution.

“BRIC alone – or any federal program on its own – isn’t going to close the nation’s disaster resilience gap,” he said. “It’s going to take community leaders, emergency managers, businesses, nonprofits – and, of course, the insurance industry – pulling in the same direction. The burden can’t exclusively fall on the property owners and federal taxpayers.”

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Climate Nonprofits Take Responsibility for Terminated U.S. Databases

Resilience Investment Payoffs Outpace Future Costs More Than 30 Times

Auto Insurance, Insurers and the Economy, Market Conditions

Oil Prices Might Reduce
Accidents, But Severity Would Offset Impact

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By Jeff Dunsavage, Head of Research Publications and Insights, Triple-I

If oil prices continue to rise due to hostilities in the Middle East, fewer drivers on the road could lead to fewer accidents and insurance claims. However, increased severity – driven by rising replacement costs – would likely overwhelm any decrease in frequency over time, according to Patrick Schmid, Triple-I’s chief insurance officer.

“Even before the war, repair costs were rising more than twice as fast as general inflation,” Schmid said.  “From the supply-chain disruptions of COVID through the past year’s economic policy uncertainty with tariffs, as well as legal system abuse, upward pressure on claim costs has been unrelenting.”

Indeed, more costly gas might not affect driving as much as one might expect. According to the American Public Transportation Association, a 10 percent rise only reduces driving by 0.2 to 0.3 percent. Even if high prices continue, the average drop is just 1.1 to 1.5 percent.

“People still need to get to work and run their lives,” Schmid said. “Gas price alone isn’t enough to dramatically change that.”

Research shows wealthier drivers cut back on driving more than lower-income drivers – who tend to have fewer choices as to how they get to and from work – when gas gets expensive. Policyholders who can’t easily reduce their driving are often the ones with tighter budgets and older, less safe vehicles.

Oil prices don’t just affect how much people drive — they also flow through the entire repair supply chain. The cost of auto maintenance and repair climbed roughly 10 percent from 2023 to 2024 alone, a trend pushed higher by inflation and a shortage of skilled technicians.

What does this mean for policyholders?

The factors that influence premiums vary widely by state, and accident frequency is just one of them.  Louisiana – one of the least-affordable states – has recently seen declines in premiums as a result of both reduced frequency and severity.  

A major contributor to high premiums is the prevalence of fraud and legal system abuse in those states. States like Florida that have proactively sought to address these factors through legal system reforms, have begun to see rate declines. Since Florida’s reforms, nearly 20 new property insurers have entered the state and existing carriers have expanded their market share, driving renewed competition in the private market. This facilitated the lowest number of policies administered by Citizens Property Insurance Corp. – the state-run insurer of last resort – in over a decade.

“It’s encouraging to see other states beginning to follow Florida’s lead,” Schmid said. “It’s important for policymakers to follow successful examples.”

Learn More:

Lessons for Texas from Florida’s Legal System Reforms

Florida Premiums Drop Amid Post-Reform Stability

Uber Joins Effort to Drive Legal System Reform

Auto Premium Growth Slows as Policyholders Shop Around, Study Says

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

New York Among Least Affordable States for Auto Insurance

Louisiana Auto Insurance Rates Benefit from Declines in Frequency, Severity

Revealing Hidden Cost to Consumers of Auto Litigation Inflation

Uber Joins Effort to Drive Legal System Reform

Legal System Abuse, Artificial Intelligence Cloud 2026 Outlook

Triple-I Legal System Abuse Awareness Campaign Enters California, Illinois

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