By Lewis Nibbelin, Research Writer, Triple-I

Vehicle thefts dropped 23 percent nationwide in 2025, marking the second consecutive year of historic declines, according to the latest analysis from the National Insurance Crime Bureau (NICB).

At 659,880 thefts, last year’s drop built on the momentum of a 17 percent decline in 2024, previously the largest decrease in total thefts in four decades. Several jurisdictions experienced even greater year-over-year decreases, with vehicle theft down by 39 percent in Washington, 35 percent in Colorado, and 34 percent in Puerto Rico.

“Coordinated prevention efforts by law enforcement, auto manufacturers, insurance companies, and the National Insurance Crime Bureau are having a major impact on vehicle thefts nationwide,” said NICB president and CEO David J. Glawe, adding that such efforts “remain key to protecting families, businesses, and communities nationwide.”

Vehicle thefts surged in 2020 to about one vehicle stolen every 36 seconds, fueled in part by shutdowns during the COVID-19 pandemic. Levels remained elevated into 2023, which recorded more than one million thefts as social media trends highlighting vehicle security system vulnerabilities gained traction.

Many trends targeted Kia and Hyundai models, comprising six of the ten most stolen vehicles that year. In response, both manufacturers began implementing stronger prevention measures and software updates, reducing their share of total thefts from 21 percent in 2023 to 14 percent in 2025.

Despite overall progress, vehicle theft across the U.S. still occurs every 48 seconds, the NICB reported. Urban communities are at greater risk, with more than one-third of thefts concentrated in the top ten metro areas in 2025. Accordingly, California – home to three of the top ten areas – recorded the highest number of vehicle thefts in 2025, contributing more than 20 percent of the nation’s total.

Beyond the direct financial cost of losing these assets, theft of vehicles or car components add upward pressure on auto insurance rates, particularly within areas known to be high-risk. The cost to repair and replace stolen vehicles is also rising, compounding a market already impacted by mounting fraud and legal system abuse across the country.

While systemic improvements have helped improve theft rates, vehicle owners must take steps to help mitigate their own risk. Triple-I recommends the following precautions:

• Keep doors locked and windows shut anytime a vehicle is left unattended.
• Hide valuables in the trunk to prevent creating an additional target on the vehicle.
• Park in secure, highly trafficked, and well-lit areas. In public parking areas, stay as close as possible to guard booths or store entrances. Keep personal garages locked.
• Consider anti-theft devices such as audible alarms and steering wheel locks. Many new cars include tracking devices, which can help locate a stolen vehicle, but these are also available for purchase and installation in older cars. Check with an insurance professional to learn how anti-theft devices can qualify policyholders for premium discounts.
• Exploit vehicle identification (VIN) numbers. A number of law enforcement agencies and insurance databases can use a VIN number to make it harder for car thieves to sell a stolen car or its parts.

Staying protected through adequate insurance coverage is also essential. Policyholders with auto policies that meet state-required minimums may lack coverage for vehicle theft or damage from theft, which is typically provided through optional comprehensive insurance.

By Lewis Nibbelin, Research Writer, Triple-I

Legislative reforms to address claim fraud and legal system abuse in Florida have continued to help stabilize the state’s property/casualty insurance market, contributing to premium reductions for thousands of homeowners and drivers, according to the latest Triple-I Issues Brief.

Since the 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 shift facilitated the lowest number of policies administered by Citizens Property Insurance Corp. – the state-run insurer of last resort – in over a decade, after a 50 percent drop in policies in force from 2024.

Claims-related litigation has also plummeted, with insurance litigation filings down 23 percent year-over-year from 2023 to 2024. Filings then fell 25 percent during the first half of 2025, compared to the same period in 2024, and remain below pre-2018 levels, as reported by the state governor’s office.

Florida’s reforms were enacted in 2022 and 2023, at a time when the state accounted for 72 percent of the nation’s homeowners claim-related litigation but only 10 percent of homeowners claims. The disparity reflected escalating premium rates and a multi-year insurer exodus, steering state lawmakers toward litigation reforms that, among other things, curtailed one-way attorney fees and assignment of benefits (AOB) for property insurance claims.

Ongoing market momentum

The impact of the reforms is particularly evident in Florida’s auto insurance market, which recorded the lowest personal auto liability loss ratio in the nation – and the state’s lowest in 15 years – in 2025, at 52.5 percent, according to the OIR. The market’s physical damage loss ratio also fell to 49.5 percent, reflecting a steady decline from 112.0 percent in 2022.

Such stability produced extensive savings for Florida drivers in 2025, with the state’s top five auto insurance groups averaging a more than 6 percent rate reduction through mid-year, accounting for 78 percent of the state’s auto market. These reductions have increased to an average of 8 percent based on the most recent 2026 regulatory filings.

Homeowners are also experiencing relief after more than 185 residential filings for flat or decreased rates over the past two years, the OIR reported. Rate changes have continued to flatten in the state after years of tracking the upward trend of rates nationally.

Lower reinsurance costs factor into this finding, translating to a 10.7 percent price decrease overall on reinsurance in 2025, according to a Gallagher Re report on the sustained success of Florida’s reforms.

“Hurricanes Helene and Milton, two powerful and destructive storms that hit Florida in September-October 2024, also provided a useful – if unwanted – test case for the reforms’ efficacy,” the report added. “Many insurers ceded losses on layers below the state’s catastrophe fund, but despite this, there was more reinsurance capacity than expected available for these layers.”

Learn More:

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Florida Senate Rejects Legal-Reform Challenge

By Lewis Nibbelin, Research Writer, Triple-I

Ridesharing platforms like Uber are as vulnerable as other businesses to the cost impacts of legal system abuse – costs that inevitably are passed along to their customers. The company reported a more than 50 percent increase in its ride insurance costs per trip in recent years, despite also recording a lower rate of overall crashes from 2017 to 2022.

Passengers see these costs reflected in trip prices, with insurance accounting for roughly 10 percent of the average rider fare nationwide, or as high as 47 percent in costlier areas like Los Angeles County.

“Insurance for us is the second-highest operating cost after payment to drivers,” said Adam Blinick, Uber’s senior director of public policy and communications, in a recent Executive Exchange interview with Triple-I CEO Sean Kevelighan. “It’s been a bit of a calling card to get more aggressive on litigation and being public about where we see the abuse.”

Coordinated attorney outreach helps fuel the trend. Among motor accident victims surveyed by Protecting American Consumers Together, attorneys contacted 92 percent after their accident, including 57 percent who reported they were contacted by more than one. Solicitation typically occurred within a week of the incident, or “before insurance can play a part in addressing someone’s concerns,” Blinick noted.

“This creates more avenues to push people into these mills and artificially inflate the value of claims,” he said.

Third-party litigation funders play a major role in recruiting claimants. Though lack of transparency surrounding the market conceals its true size, a recent report from the National Insurance Crime Bureau and 4WARN estimates third-party funders spent more than $380 million on online search ads alone between June 2024 and June 2025, with some engaging in brand impersonation and search engine manipulation to mislead consumers and extend litigation.

Research from Triple-I and the Casualty Actuarial Society (CAS) estimates excessive litigation added $231.6 billion to $281.2 billion in liability insurance losses from 2015 to 2024, a finding that economic inflation alone cannot explain. A separate Triple-I report on civil case filings reinforces the finding, revealing approximately $42.8 billion in excess litigation value from motor vehicle tort cases filed between 2014 and 2023 in the federal and state civil courts.

“That’s a drop in the bucket to the reality of the problem,” Kevelighan said, “because less than 10 percent of cases had judgments. Others were settled and we can’t necessarily track the settlement data.”

Blinick discussed how uninsured and underinsured motorist (UM/UIM) insurance limits can also attract high claim volumes and disputes, particularly for the rideshare industry. Multiple states require ridesharing businesses to pay $1 million or more for such coverage, with limits in New York set at $1.25 million. Though intended to provide relief for policyholders hit by UM or UIM, these requirements mean bad actors stand to win more from claims, incentivizing excessive lawsuits and fraud.

Staged crashes generate many such claims, with some schemes involving a network of rideshare passengers who are “tied to the law firm, the medical providers, the body shops, the lenders themselves… all across the board,” Blinick said.

He added that many offenders “are the same ones who are doing slip and fall claims and mass tort suits against cities and counties. They’re not picky in terms of who they’re going after. They’re going wherever the opportunity presents itself.”

A 2025 California law that went into effect this year aims to help mitigate fraud by reducing the rideshare industry’s UM/UIM coverage limits from $1 million to $300,000 per accident. Uber has also submitted a November 2026 ballot measure that would cap contingency fees and limit medical damages in vehicle accident cases within the state, as well as shown support for New York’s 2027 budget proposals to combat fraud and unnecessary litigation.

Learn More:

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Litigation Reform Works: Florida Auto Insurance Premium Rates Declining

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

IRC Report Reveals One in Three Drivers Were Either Uninsured or Underinsured in 2023

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 29^th 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:

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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.”

By Lewis Nibbelin, Research Writer, Triple-I

Louisiana Insurance Commissioner Tim Temple recently announced that new litigation reforms have helped drive improvement in the state’s auto insurance market, with more than 20 rate decreases filed since mid-2025.

Temple 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:

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By William Nibbelin, Senior Research Actuary, Triple-I

The U.S. personal auto insurance industry saw a significant turnaround in 2024, achieving its best underwriting result since the pandemic began, according to Triple-I’s latest Issues Brief.  

In fact, with a net combined ratio of 95.3, personal auto insurance has outperformed the broader property and casualty (P/C) insurance industry in terms of underwriting profitability for 10 out of the last 20 years. A combined ratio under 100 indicates an underwriting profit. One above 100 indicates a loss.

This positive shift comes after a period in which personal auto premiums experienced fluctuations. While the overall P/C industry outpaced personal auto in premium growth from 2018 to 2022, personal auto saw a strong rebound in 2023 and 2024, with double-digit premium growth rates of 14.4 percent and 12.8 percent, respectively. This surge in premiums follows a notable decline in 2020, the first since 2009, largely due to reduced driving during the initial phase of the COVID-19 pandemic. Since then, vehicle miles driven have returned to pre-pandemic levels.

A major factor influencing auto insurance premiums has been the significant rise in replacement costs for vehicles and parts after the pandemic. Insurers adjusted rates in response to these increased costs. The changes in consumer prices for new and used vehicles, as well as parts and repairs, have shown a strong correlation with average insurance rate adjustments over the past decade:

• New Vehicles: 88 percent correlation;
• Motor Vehicle Parts & Equipment: 74 percent correlation;
• Used Vehicles: 79 percent correlation; and
• Motor Vehicle Maintenance & Repair: 78 percent correlation.

Looking at losses, the direct incurred loss ratio for personal auto improved considerably by 21.7 points from late 2022 to the end of 2024. However, this improvement wasn’t uniform across all types of claims. Auto physical damage claims saw more improvement than auto liability claims, creating the largest disparity between the two in over a decade of 15.7 points.

Loss trends in personal auto are shaped by how often claims occur (frequency) and the average cost of each claim (severity). For personal auto liability, while the number of claims has stayed below pre-pandemic levels, the average cost per claim has continued to rise year after year with a cumulative increase from 2019 to 2024 of 54.2 points.

One of the significant challenges contributing to the increasing severity in personal auto liability is what’s known as legal system abuse. This includes a rise in lawsuits, larger jury awards, and more attorney involvement in claims. This phenomenon, intertwined with broader inflation, has driven up auto liability losses and related expenses by a range of $76.3 billion to $81.3 billion from 2014 to 2023 according to the latest Triple-I | Casualty Actuarial Society study.

Another important factor impacting the auto insurance market is the state regulatory environment. A recent report by the Insurance Research Council on Rate Regulation in Personal Auto Insurance indicated that the process for insurers to get rate changes approved has become more complex across the country between 2010 and 2023. This has led to longer approval times and a higher incidence of insurers receiving less than their requested rate increases. These trends can ultimately affect the availability of competitive auto insurance policies for consumers.

Learn More:

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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.

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.  

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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.”

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