Property & Casualty Insurance Carriers NAICS 524126

Dec 8, 2025 - Natural Disaster Claims Top $100 Billion in 2025

• US natural disaster insured losses through the first nine months of 2025 remained high despite a surprisingly mild third quarter, helping push total global insured losses above $100 billion for the sixth straight year. The costliest US events were two major January wildfires near Los Angeles and multiple severe storm outbreaks, which together comprised a large share of the year’s loss total. There have been 16 billion‑dollar insured loss events globally so far in 2025, with 15 of them in the US. Severe convective storms alone cost insurers about $46 billion, marking the fourth‑costliest year on record for such events. Most losses occurred early in the year; the third quarter saw unusually low claims due to quiet tropical cyclone activity. Gallagher Re noted that although late‑season storms or an earthquake could still raise losses, overall 2025 insured losses may end below recent averages for the industry.
• Soaring insurance costs in the US have intensified regulatory scrutiny as premiums for home and auto coverage climb at record rates. According to S&P Global, homeowners’ premiums rose 12.7% in 2023 and another 10.4% in 2024, with the average policy reaching about $1,900 in 2023, up nearly 50% from pre-pandemic levels. Over 5.3 million US households now pay more than $4,000 annually for property insurance. Auto insurance followed a similar trend, increasing 8.4% in 2023 and an additional 17.8% in 2024, according to the Bureau of Labor Statistics. Rising claims from natural disasters, high repair costs, and tighter reinsurance markets have pushed insurers to seek steep rate hikes. But as affordability worsens, regulators in states like California, Florida, and Louisiana are pushing back, rejecting or capping increases and signaling a shift toward more active oversight of the insurance industry’s pricing practices.

• The homeowners insurance market will have a difficult 2025, with S&P Global Market Intelligence forecasting losses for the seventh time in nine years. Homeowners insurance lines are projected to finish the year with a 106.1% combined ratio (an industry metric of how many dollars an insurer spends on claims versus what they take in in premiums). California wildfires in January are incurring significant industry losses, so much so that it is offsetting underwriting gains in private auto insurance (forecast at a 95.1% combined ratio). State Farm has incurred the majority of losses from the wildfires, and its $6.57 billion bill from California could account for as much as a four point gain in the combined ratio for the entire industry. State Farm has already raised rates to compensate, even as it is slow to process claims, sparking a backlash among its customers and insurance regulators.
• The increasing cost of homeowners insurance has some Americans choosing to do without it altogether, according to the Federal Reserve’s Economic Well-Being of US Households of 2024 report. Of the 12,000 homeowners surveyed across the country, about 7% said they have no insurance, citing either unaffordability (43%) or not finding insurance worth it (19%). The analysis also found that 30% of low-income homeowners - those making less than $25,000 a year - are more likely to forego insurance. Watchdog group Consumer Federation of America found a similar 7.4% uninsured rate last year in their own study, which translates to 6.1 million US homes without any coverage. There is also a correlation between uninsured homeowners and foreclosures, according to climate risk consulting firm First Street. Insurance costs have jumped to more than 20% of a mortgage payment in 2022, per First Street, triple the 7%-8% rate in 2013.