Research
Inflation is Americans' Top Financial Concern and Most Say Their Income is Not Keeping Up, According to Northwestern Mutual's 2025 Planning & Progress Study
Inflation continues to sting in America, with significant numbers of U.S. adults saying elevated prices in the grocery aisles, at the gas pump and elsewhere are having a large impact on their finances. Meanwhile, among people who don't own a home, the majority say homeownership will never be affordable – not now, not ever.
At the same time, some financial trends, behaviors and concerns among Americans have shifted in a positive direction since last year. People are feeling more optimistic that the United States will avoid recession and they're reporting greater financial discipline, reversing a five-year decline. And for Millennials, the burden of college debt appears to be receding – but a new financial foe is taking its place: medical debt.
These are among the topline findings from Northwestern Mutual's newly released 2025 Planning & Progress Study, the company's proprietary research series that explores Americans' attitudes, behaviors and perspectives across a broad set of issues impacting their long-term financial security.
Inflation is the #1 financial concern and Americans say their household incomes are not keeping up
Northwestern Mutual's 2025 Planning & Progress Study finds that half (51%) of U.S. adults believe inflation will increase in 2025, more than double the 25% who expect inflation to decrease and the 24% who expect it to stay the same.
Furthermore, two-thirds (65%) of U.S. adults say inflation is the dominant concern that could impact their finances this year, and more than four in 10 (44%) rank inflation as the #1 obstacle to achieving financial security.
For the second year in a row, more than half (52%) of Americans believe their household income is growing slower than inflation. That's more than four times greater than the 11% who say their income is growing faster than inflation, while three in ten (28%) believe their income is on pace with inflation.
Americans are using this strategy to save money on home insurance. Is it a good idea?
Homeowners frustrated with rising home-insurance premiums are switching plans and opting for higher deductibles to manage their costs, a new report says, but these might not be the best strategies for everyone.
Homeowners who took on a mortgage last year had deductibles that were 19% higher than those of the average mortgage holder, and ended up with premiums 12% lower, according to data from Intercontinental Exchange.
Meanwhile, about 11.4% of homeowners with a mortgage switched insurance providers in 2024, ICE found, up from 9.4% the previous year. While homeowners are finding ways to make their monthly housing costs cheaper, is it a good idea to change plans or pay a higher deductible? Here’s what experts and data say.
U.S. commercial insurance rates continue to rise moderating to 5.6% increase - WTW
U.S. commercial insurance rates showed a continued upward trend with signs of moderation in the fourth quarter of 2024, according to the latest findings from WTW's Commercial Lines Insurance Pricing Survey (CLIPS).
The survey compares premiums for policies underwritten during the fourth quarter of 2024 to those for the same coverage in the respective quarter of 2023, providing a year-over-year perspective. Carriers reported an aggregate price increase of 5.6% in the fourth quarter, down from the rate of 6.1% recorded in the third quarter of 2024.
While overall rates showed a moderate slowdown, significant changes were observed in specific coverage lines. Excess/Umbrella Liability recorded its highest price increase in the past three years, while Commercial Auto recorded its highest price increase in the entire history of CLIPS, continuing to rise in double digits.
Yi Jing, Senior Director, Insurance Consulting and Technology (ICT) at WTW
Workers’ comp premiums spike on new jobs and better pay | BenefitsPRO
Wage increases and job growth have spiked premiums across workers’ compensation despite market challenges like medical inflation and a changing workforce, according to a recent report by Risk Replacement Services.
The property and casualty sector wrote $43 billion in workers’ comp premiums in 2023, the data showed, up from $42.5 billion in 2022. Over that same time, premiums jumped 1% across the industry at a combined ratio of 86%.
There was also an 8% reduction in lost-claim frequency to more than double the long-term average decline in that metric. Key market drivers included continued pressure related to medical inflation and the rising cost of hospital stays and health care, and changes to the job market like an aging workforce and increased use of AI and automated services.
Meanwhile, the Bureau of Labor Statistics (BLS) reported on Friday March 7, that the U.S. economy added 151,000 new jobs in February, marking a slight improvement from the 143,000 new jobs added in January.
Related: Job market rebounds: Report shows strong demand, low volatility
“In a strong job market like we’re seeing, companies face pressure to pay more when hiring,” said Patrick Edwards, area senior VP and workers’ compensation practice leader at Risk Replacement Services.
Agents per state
In 2023, California led the nation in direct premium earned for property and casualty (P&C) insurance, totaling $88.1 billion, followed by Texas at $70.9 billion and Florida at $63.8 billion. These three states also recorded the highest number of P&C insurance agents, a trend that likely correlates with their substantial direct premium volumes.
However, when analyzing the top states by estimated premium per agent, California, Florida and Texas don’t rank among the top 10. The state with the fewest number of P&C agents, Montana, ranks the highest with an estimated premium of $3.6 million per agent. Montana is followed by Alabama ($3.1 million) and Arkansas ($2.8 million).
This makes Montana the best state for insurance agents due to the high premium per agent. Conversely, Ohio is the worst state for insurance agents, with the premium per agent totaling only $592,920.03.
Climate/Resilience/Sustainability
The Blind Spots in Catastrophe Models | Insurance Thought Leadership
Traditional catastrophe models fall short as climate change intensifies natural disaster risks, demanding smarter approaches to assessment.
To outsmart the uncertainties posed by complex and related physical climate risks, organizations need to consider whether their current approach to modeling and assessing natural catastrophe is fit-for-purpose.
As the world heads toward global warming potentially beyond two degrees Celsius by 2050, we're already seeing greater volatility in weather-related natural catastrophe events, as well as an increased impact of chronic hazards, such as heat and cold stress. This is leading to greater uncertainty in economic losses and insurability.
By better understanding and quantifying the true cost implications of climate-amplified natural catastrophe risks, organizations can better prepare for the risks. This may mean checking they are not over-reliant or misinterpreting catastrophe risk models to ensure they avoid gaps in their organization's protection.
Traditional models leaving businesses exposed
Some traditional models for quantifying natural catastrophe risk are leading businesses to potentially miscalculate or underestimate their exposure to catastrophic events. Due to the lack of data and functionality limitations, traditional natural catastrophe modeling typically struggles to capture the wider financial impact due to external value chain interdependencies and operational disruption.
Torolf Hamm is senior director and global lead of physical risks and climate practice at WTW
InsurTech/M&A/Finance💰/Collaboration
J.D. Power acquires SIA online auction platform to dive deeper into remarketing
J.D. Power is going deeper into the automotive remarketing business.
The global data and research firm has acquired Superior Integrated Auctions, which the companies said combines SIA’s online auction marketplace capabilities with J.D. Power’s inventory, vehicle valuation data, predictive analytics and digital marketing systems to streamline pre-owned vehicle inventory management.
The companies have been collaborating since October, when they partnered to launch the J.D. Power Marketplace, an electronic auction platform J.D. Power said gives dealers access to more than 30,000 vehicles.
The platform is designed to allow manufacturers, dealers, finance companies, car rental companies and other industry stakeholders to create white-label online auctions and sales tools.
“Inventory of high quality, front-line-ready, pre-owned vehicles is trending toward the lowest level in a decade, which is putting pressure on dealers to find vehicles when and where they need them without incurring huge upfront costs,” said Phillip Battista, J.D. Power’s president of dealership technologies and head of modern retailing.
Previsico Drives U.S. Expansion with Funding led by Burnt Island Ventures
Surface water flood forecasting and alert InsurTech Previsico (London) has announced further funding, led by new investor Burnt Island Ventures (New York), a venture capital firm specialising in water innovation, with participation from Foresight Capital Ventures (San Franciscso) and the company’s existing angel investor network.
Previsico says the funding will support and accelerate the company’s overall growth, with a particular focus on expanding its footprint in the U.S., where flood-related hazards cause billions of dollars in damage annually. This company asserts that the enw investment underscores investor confidence in the InsurTech’s mission to mitigate flood impacts globally through innovative technology.
“The Previsico Flood Intel Platform delivers accurate flood alerts to property owners and large asset holders, at the right time, so they can take action,” says Christine E. Boyle, Partner, Burnt Island Ventures. “Previsico completely flips the script on underwriting flood insurance for both direct customers and insurance channel partners, and it’s deeply exciting to be a part of it. With abundant proof points of success in the U.K., we are excited to work with Previsico on their U.S. expansion.”
Telematics, Driving & Insurance
Sfara announces improved fraud detection through SDK 8 and new adjuster-focused collision insights
We are harnessing the power of technology to enhance and save lives with the goal of providing a Sphere of Safety™ to every person with a smartphone on the planet.
Sfara announces improved fraud detection through SDK 8 and new adjuster-focused collision insights
Insurance companies now get access to over forty reference points for vehicular incidents at all speeds, plus the increased ability to identify fraud, especially at those difficult to capture low speeds.
Reconstructing a crash by reading incident reports is a challenging task. With the release of SDK 8, Sfara provides the tools to better review the data leading to an incident, as well as identify fraud, even at low speeds.
Sfara’s new adjustor-focused collision insights provides over forty points of reference for a crash, giving adjusters and managers the ability to quickly view data points, timelines, maps and direction of impact.
Plus, Sfara is introducing declared and flagged anomalies for better identification of fraud. Anomaly detections are incidents captured by phone sensors but determined not to be a crash by Sfara’s technologies. Flagging these incidents makes it possible to review and compare reported incidents or discovered dents and scratches to actual data.
Why pedestrian safety clothing may confuse automated crash prevention systems - Auto Service World
A new study is warning about the risk of reflective clothing and a vehicle’s crash prevention systems.
The report from the Insurance Institute for Highway Safety (IIHS) suggested that the clothing designed to make pedestrians stand out to human drivers may actually make them invisible to automated systems.
“These results suggest that some automakers need to tweak their pedestrian automatic emergency braking systems,” said IIHS president David Harkey. “It’s untenable that the clothes that pedestrians, cyclists and roadway workers wear to be safe may make them harder for crash avoidance technology to recognize.”
Past IIHS research has shown that pedestrian automatic emergency braking (AEB) systems generally reduce the rate of pedestrian crashes by 27 per cent. However, on dark roads, the effect of pedestrian AEB on crash risk is negligible, which is concerning since most fatal pedestrian crashes occur at night. Automakers are already working to address this issue in response to IIHS ratings that now emphasize nighttime performance, but real-world factors complicate the situation.MORE
The Psychology Of Delivery Driver Engagement Through Telematics
In my years leading a company dedicated to improving last-mile delivery, I’ve seen firsthand the profound impact that technology can have on driver behavior. But the real breakthroughs come not from technology alone, but from understanding the human drivers behind the wheel. The psychology of driver engagement—how people react to feedback, competition and rewards—has become one of the most fascinating aspects of my work.
Telematics, while often viewed as a tool for route optimization and safety, has the power to influence driver motivation and productivity in ways we’re only beginning to understand. By applying psychological principles such as gamification, real-time feedback and social comparison, I believe we can unlock the full potential of this technology—not just for operational efficiency, but for creating a safer and more fulfilling work environment for drivers.
Gamification: A Case Study In Motivation
I once visited a fleet where drivers were skeptical about a new telematics system that included gamified elements. They saw it as another way for management to micromanage. But after just a few months, the skepticism turned into excitement. Drivers were sharing tips, competing for top safety scores and even joking about their “rivalries” for leaderboard spots.
Why the change? The science is clear: achievements, even small ones, trigger dopamine release, creating a sense of reward and reinforcing positive behaviors. For these drivers, gamification reframed safe driving as a point of pride rather than a mundane necessity.
The ripple effects were remarkable. Accident rates dropped, and drivers reported feeling more connected to their work. It was a powerful reminder that sometimes, what people need isn’t more oversight—it’s more recognition.
Brian Moroney is the CEO of Drivosity
AI in Insurance
The transformative impact of AI on insurance underwriting
As the insurance sector continues its digital metamorphosis, AI and technology are at the forefront of this revolution, promising to reshape underwriting processes. These advancements are not just about automation; they are redefining the roles of underwriters, MGAs, and reinsurers, driving them towards more profitable and efficient operations.
In a sector where tradition often meets innovation tentatively, the acceleration brought by AI-driven tools and data analytics is noteworthy. Industry leaders are now acknowledging the potential of these technologies to refine decision-making processes, thereby enhancing operational efficiencies and profitability. This transformative journey is supported by a blend of AI applications and strategic partnerships, which are crucial in navigating the complex landscape of digital adoption within the industry.
The role of underwriters is evolving significantly in this new tech-driven environment. They are transitioning from traditional risk assessors to strategic advisors who leverage technology to provide enhanced insights and services. This shift is pivotal as it blends analytical prowess with essential human judgement, ensuring that the integration of technology augments rather than replaces the nuanced expertise of professionals.
Despite the enthusiasm for digital tools, the adoption pace varies across the industry, with some companies embracing change more rapidly than others. This cautious progress underscores the challenges of integrating new technologies into established systems and cultures that are typically risk-averse.
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