News
US home insurance costs rising faster than inflation
The costs outpace income growth, reaching lowest affordability levels
The average cost of claims per insured home in the United States has increased at a rate faster than inflation over the past 20 years, according to a new research brief released by the Insurance Research Council (IRC), an affiliate of The Institutes.
The study, Homeowners Insurance Affordability: Countrywide Trends and State Comparisons, attributes the rise to multiple factors, including natural disasters, legal system abuse, fraud, escalating home repair expenses, and population shifts into disaster-prone areas. The report further reveals that homeowners’ insurance costs have risen disproportionately in comparison to household incomes, leading to record-low affordability.
“From natural disasters and legal system abuse to escalating repair costs and fraud, the pressures on home insurance costs are significant, and they are driving premiums higher for consumers,” said Dale Porfilio, president of the IRC.
The IRC introduced an Affordability Index to measure the ratio of average homeowners’ insurance expenditures to median household income. In 2001, US households allocated 1.19% of their income toward homeowners’ insurance. That percentage climbed to 2.09% in 2022 and is projected to reach 2.4% by the end of 2024.
Research
AAA Poll Shows Americans May Be Slow to Adopt Electric Vehicles
Data and reports may show that electric vehicles are becoming more popularity, not that many people are likely to by an EV as their next car—a possible sign that some people may be cooling on the EV buzz that gained traction in recent years.
A poll from AAA shows that charging concerns were cited by consumers as challenges for buying electric vehicles despite the availability of EVs.
Crash Course 2025: Expert Insights for the Casualty Market | CCC Intelligent Solutions
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Still have questions? We'd love to connect and talk through how our solutions can help address the challenges outlined in the report findings.
AI in Insurance
Markel announces collaboration with Insurate to advance middle-market workers compensation through AI and innovative safety scoring
Markel Insurance ("Markel"), the insurance operations within Markel Group Inc. (NYSE: MKL), announced today a strategic collaboration with Insurate, an innovative insurtech company specializing in the middle-market workers compensation sector. Insurate leverages artificial intelligence (AI) and next-generation safety scoring methodologies to underwrite and manage complex workers compensation risks.
This initiative follows Markel's disciplined approach to entering the middle market workers compensation space. After careful market analysis and due diligence, Markel identified Insurate as the right market entry partner, recognizing its unique combination of deep insurance industry expertise and a sophisticated high-technology background.
"Insurate's forward-thinking approach to risk assessment and safety aligns perfectly with Markel and our commitment to innovation, empowering individuals, and creating long-term value," said Jeff Lamb, Executive Director, Programs & Alliances at Markel. "We were impressed not only by their technology but also by their fundamental understanding of the insurance landscape and their focus on fostering safer workplaces. This collaboration represents a carefully considered step to enhance our capabilities and better serve the vital middle-market segment."
Insurate's platform utilizes advanced AI algorithms to analyze vast datasets, providing nuanced insights into workplace safety performance. This allows for more accurate risk assessment and pricing, particularly for complex industrial and service operations that are common in the middle market.
Climate/Resilience/Sustainability
Congress takes on rising home insurance costs with bold plan
A new bill introduced in the US House of Representatives seeks to bolster state insurance programs by directing the Treasury Department to guarantee obligations and provide reinsurance for eligible programs addressing natural disaster risks.
House Resolution 827, known as the Homeowners’ Defense Act, was introduced by Rep. Frederica Wilson (pictured), D-Fla., to address concerns over property insurance costs and market stability.
The legislation aims to support state efforts in managing risks from natural disasters, stabilize insurance markets, and promote mitigation initiatives, according to a statement from Wilson’s office.
House Resolution 827 – what does it do?
Under House Resolution 827, the Treasury Department would guarantee up to $3.5 billion in debts for state programs covering earthquake risks and up to $17 billion for programs addressing other perils.
Eligible programs must outline debt repayment plans without using federal funds, with terms including fees for coverage and a maximum duration of 30 years. The Treasury would also prohibit coverage for flood losses in properties required to have flood insurance, already covered by it, or located in special flood hazard areas.
Additionally, the legislation allows the Treasury to enter one-year reinsurance contracts with eligible state programs, covering 80% to 90% of insured losses. The Treasury secretary would set attachment points and pricing.
New studies point to increasing risk of loss from wind, rain during hurricanes
As hurricane season begins June 1, new studies point to an increasing risk of loss from severe wind and water damage common during these intense storms.
Published in the Society for Risk Analysis’ journal, a study by University of Illinois researcher and civil engineer Eun Jeong Cha predicts the risk of loss from hurricane-related winds could increase up to 76% as soon as 2060 for states in the Southeast, including Louisiana.
“These states experience the highest hurricane activity and associated wind-related losses in the U.S.,” Cha said in a news release. “They represent a critical region for understanding how climate change may alter hurricane risk.”
While much of the damage from storms is caused by water, over 40% of residential storm-related losses from hurricanes are attributed to heavy winds, costing the U.S. economy an expected $14 billion annually, according to a 2019 Congressional Budget Office report.
Mercury Insurance Builds Climate Science Team to Tackle the Impact of Extreme Weather Events
Mercury Insurance (NYSE: MCY), a leading provider of property and casualty insurance, has appointed Steve Bennett as its Senior Director of Climate and Catastrophe Science. In this new position, Bennett will build and lead a team dedicated to helping identify ways Mercury and its policyholders can work together to better prepare for — and be more resilient — in the face of increasingly severe climate-driven weather events.
This move is the latest in a series of investments by Mercury to better understand and counteract forces facing insurance providers in high-risk areas. Climate change, population growth and resulting urban expansion has placed the insurance industry at a crossroads, resulting in many insurers pulling back from areas prone to wildfires, hurricanes and other catastrophic climate events. Mercury has taken a different approach to this challenge over the past year, working with homeowners, municipalities and government to create more resistant and insurable risks. The result has led to Mercury writing more policies in areas where its competitors have cancelled or non-renewed coverage for tens of thousands of consumers.
"Mercury is constantly looking for ways to say 'yes' to consumers, and to do that we are taking a science-based approach to risk," says Bennett. "When customers do their part to harden their homes and communities from potential catastrophic events, we will do ours by extending affordable coverage options to those who may have difficulty securing policies. I'm proud to be part of a larger Mercury vision dedicated to ensuring that investments in mitigation and smarter rebuilding translate into a healthier and more efficient insurance marketplace for everyone."
From satellite to strategy: How ICAT is reinventing underwriting with AI and sensor tech
AI is innovating all arms of insurance – but perhaps none more than underwriting. According to data from Capgemini, 62% of executives believe AI is improving underwriting quality and reducing fraud – with 43% of underwriters adding that they trust and regularly accept automated recommendations from predictive analytics tools. However, the true magic manifests when firms start to combine AI with the power of data science.
Speaking to IB, Robert Klepper, chief underwriting officer at ICAT, explained that the strategic integration of innovative new tools is helping redefine how underwriters evaluate properties nowadays
“The currency that we use is really location-level attributes for property underwriting,” he said. “That goes across the range of residential into small commercial and then large commercial.”
But with access to more data than ever before, the challenge isn't scarcity — it's structure. As Klepper told IB, ironically one of the biggest issues underwriters face is dealing with too much data, especially if you're a desk underwriter.
“From there it becomes a question of how do you structure the data? How do you organize it in a way that can give you insights to make decisions?” added Klepper. Here, ICAT employs both passive and dynamic data sources. Dynamic sources include physical inspections and sensor data, while passive data often comes in the form of satellite or aerial imagery.
Telematics, Driving & Insurance
Arity promises more transparent UBI data and driving report access | Repairer Driven News
Arity, a mobility data and analytics company and Allstate subsidiary, says it has found a way to offer more transparent usage-based insurance (UBI) data and driving reports to consumers.
Right now, users have to request a copy of their driving reports from Arity after signing up for a UBI program or agreeing to share their driving data with one of Arity’s mobile app partners.
“We recognize that this process can be unclear or difficult to navigate, and that not all consumers are aware they even have a driving score,” Arity told Repairer Driven News. “To help bridge this gap, our new D2C [direct to consumer] tool will make it easier for individuals to check whether a driving report exists for them, and view it directly, even before enrolling in a UBI program or agreeing to share it when shopping for insurance. This new tool is designed to bring greater transparency, accessibility, and control to consumers interested in understanding how their driving behavior might impact insurance pricing.”
The tool is slated to launch later this year, according to Arity.
[MORE[(https)://www.repairerdrivennews.com/2025/06/11/arity-promises-more-transparent-ubi-data-and-driving-report-access/
Roadzen’s DrivebuddyAI Awarded Patent for Real-Time Driver
New Patent Positions DrivebuddyAI to Lead India’s Upcoming Road Safety Mandates, Achieves 72% Accident Reduction Across Fleets...
Roadzen Inc. (Nasdaq: RDZN) (“Roadzen” or the “Company”), a global leader in AI at the intersection of insurance and mobility, today announced that its DrivebuddyAI platform has been granted a patent in India for its Real-Time Driver Drowsiness Detection Algorithm.
DrivebuddyAI’s patented system leverages AI and computer vision to monitor over 92 real-time eye and facial cues, enabling early detection of driver fatigue and triggering instant alerts—helping prevent accidents before they occur. The newly granted patent strengthens Roadzen’s expanding global IP portfolio, with additional filings underway in the U.S. and Europe.
According to the U.S. National Highway Traffic Safety Administration (NHTSA), crashes involving at least one distracted driver accounted for 29% of all motor vehicle crashes and costs. This underscores the urgent need for real-time safety technologies like DrivebuddyAI, which directly target distraction and fatigue—the two leading contributors to road incidents globally.
This breakthrough capability is also core to compliance with India’s upcoming draft road safety regulation for commercial vehicles, that is expected to be adopted by April 1, 2026. The regulation will require Driver Drowsiness and Attention Warning Systems (DDAWS) or AIS 184 in all new commercial vehicles produced — impacting over 1 million units annually. DrivebuddyAI remains the first and only platform validated under the AIS-184 standard by the Automotive Research Association of India (ARAI), positioning Roadzen as the frontrunner in this transformational regulatory and market opportunity.
Commentary/Opinion
Mary Meeker Weighs in on AI | Insurance Thought Leadership
The high-profile analyst shows that AI has been improving far faster even than we realize and that progress is accelerating, with no end in sight.
Mary Meeker, a high-profile analyst known as "the Queen of the Internet" because of her early, bullish calls on the prospects for Amazon, Google and Apple and then for the massive yearly reports she issued on the state of the internet, has turned her attention to AI.
In her first major report in five years, Meeker makes the case that AI has been improving far faster even than we realize and that progress is accelerating, with no end in sight.
Her forecast — and she's generally right — should be very good news for insurers.
Paul Carroll, Editor-in-Chief, Insurance Thought Leadership
InsurTech/M&A/Finance💰/Collaboration
Brown & Brown signs nearly $10 billion deal for rival broker Accession
Insurance broker Brown & Brown (BRO.N), opens new tab will buy rival Accession Risk Management in a $9.83 billion cash-and-stock deal, the companies said on Tuesday, adding to a string of mega-mergers in recent years as industry players look to consolidate.
While small buyouts are typical in the highly fragmented industry, the deal highlights that companies are willing to pay top dollar for acquisitions that significantly enhance their market presence or strengthen their competitive edge.
Boston, Massachusetts-based Accession is the parent of Risk Strategies, which was founded in 1997 by insurance industry veteran Mike Christian. It also houses insurance wholesaler One80 Intermediaries.
Both companies connect insurers with customers and have a diverse client base, including commercial firms and nonprofit organizations. Brown & Brown expects to fund the acquisition through a $4 billion equity raise and issuance of $4 billion of bonds across multiple tenors. Its stock dipped 0.6% in early trading.
Autonomous Driving/Insurance
Goldman Sees Autonomous Vehicles Transforming Insurance World
The rise of autonomous vehicles will force a reconfiguration of the $400 billion U.S. auto-insurance industry, as accidents caused by human error decrease and costs are slashed, but questions about liability remain, according to Goldman Sachs.
“Autonomy has the potential to significantly reduce accident frequency longer-term and reshape the underlying claim cost distribution and legal liability for accidents,” Goldman Sachs analysts including Mark Delaney wrote in a June 9 note to clients.