News
Property insurance rates slide as cat losses diminish
Commercial property insurance buyers saw double-digit rate decreases at year-end renewals as ample capacity and lower-than-expected catastrophe losses fueled fiercely competitive market conditions.
While 2025 began with catastrophic California wildfires, hurricane season ended with no major storms, and new capital entered the market as insurers looked to grow their property books.
Buyers will see continued softening this year, providing the property line remains profitable, brokers say. Insurers saw favorable Jan. 1 treaty reinsurance renewals where rate reductions averaged as much as 20% on catastrophe programs.
The average rate reduction on Aon’s national property book through the fourth quarter was 12.5%, said Vincent Flood, New York-based U.S. property practice leader.
Shared-and-layered programs saw reductions averaging about 16%, while single-insurer programs saw mid- to high-single-digit decreases, Mr. Flood said. Policyholders using the alternative risk and capital markets can obtain an additional 10% rate decrease, he said.
Property remains a growth area for insurers, with five or six new markets in Bermuda recently adding $25 million of catastrophe capacity, which is driving competition, Mr. Flood said.
The market will “continue to soften to the tune of 10% to 15%,” he said.
Governor Ron DeSantis Announces Major Insurance Rate Relief as Florida’s Reforms Deliver Results | Executive Office of the Governor
Today, Governor Ron DeSantis announced significant statewide insurance rate relief for Florida homeowners, as Citizens Property Insurance policyholders across the state will see meaningful premium reductions beginning in Spring 2026 at policy renewal.
The reductions reflect continued stabilization of Florida’s insurance market following comprehensive insurance and tort reforms enacted under Governor DeSantis’ leadership.
“Floridians are seeing rate reductions in both auto and homeowners insurance across the state, with additional relief coming soon,” said Governor Ron DeSantis. “The reductions in Citizens Insurance rates are the most significant in recent memory. Premiums are lowering because we’ve enacted real reforms and withstood the pressure to reverse course. We will hold firm in our commitment not to go back to the broken insurance market of the past.”
“Four years ago, our insurance market was near collapse, which is why I stood alongside our Governor to create historic lawsuit reform, cut out the waste, fraud and abuse, and strengthen our insurance market,” said Chief Financial Officer Blaise Ingoglia. “Those reforms are working, and Florida homeowners are seeing the benefits. No other state and no other Governor is doing more to deliver on his promises and tackle housing affordability than Governor DeSantis. Florida continues to lead the nation on all fronts.”
“We are seeing nothing but good news across all data points for Florida’s auto and home insurance markets. These positive results are entirely related to our historic tort reforms, driven largely by Governor DeSantis’ leadership," said Insurance Commissioner Mike Yaworsky. "I am hopeful that these reforms will not be repealed and that we will continue to be dogged in our efforts to improve the everyday conditions for Floridians.”
California Bill Seeks to Add ‘Transparency’ to Aerial Images Used by Insurers
A California lawmaker is pushing to require insurers to notify homeowners in advance of taking or using aerial images of their property, and to stop insurers from basing decisions to cancel, non-renew, or reduce coverage based on aerial images older than 180 days.
Assembly Bill was introduced last week by Assemblymember Lisa Calderon, D-Whittier, chair of the Assembly Insurance Committee. Calderon said the aim of the bill is to protect homeowners by providing transparency when aerial images of their homes are taken or obtained by insurers.
“As the insurance crisis continues, it is imperative we do what we can to protect policyholders,” stated Calderon. “AB 1559 empowers homeowners by adding a layer of transparency when it comes to non-renewals.”
Aerial imagery, which includes images taken by drones, satellites, and airplanes, can help insurers conduct inspections and acquire detailed information not visible through a traditional home inspection, but the technology can also lead to erroneous insurance policy non-renewals based on inaccurate, outdated or misleading images, according to Calderon.
2025/2026: REVIEWS & OUTLOOK
2026 the year of AI disillusionment: CyberCube
CyberCube has forecast that 2026 will usher in a phase of AI disillusionment, as boardroom optimism and conference hype collide with the constraints of legacy systems, fragmented data, and regulatory caution, though those that apply AI with discipline and focus will still reap rewards.
As the cyber insurance ecosystem continues to evolve, one truth has become clear: the organisations that thrive are those that anticipate change rather than react to it,” CyberCube said in its new 2026 predictions report.
According to the firm, the year ahead will test assumptions, challenge long-held practices, and redefine what “good” looks like in cyber risk management, underwriting, and portfolio strategy.
“AI will continue to dominate boardroom conversations, not just as an enabler, but as a disruptive force that reveals who has embraced disciplined adoption and who risks falling behind,” CyberCube’s report observed.
What’s more, shifts in regulation, including age-restriction laws, may unintentionally undermine security and privacy for all users.
Financial Results
Why Are Lemonade (LMND) Shares Soaring
What Happened?
Shares of digital insurance provider Lemonade (NYSE:LMND) jumped 8.3% in the afternoon session after Truist Securities initiated coverage on the company with a "Buy" rating and a $98 price target.
The new coverage from Truist highlighted Lemonade's digital-first approach as a structural advantage over traditional insurers. This positive view followed the company's strong third-quarter 2025 financial results, where it posted better-than-expected earnings and revenue.
In response to the solid performance, Citizens also raised its price target on the stock to $80 from $60. The stock's climb, which marked a new 52-week high, reflected this renewed investor confidence, driven by favorable analyst ratings and solid financial performance.
The shares closed the day at $86.52, up 8.6% from previous close.
Research
Expense Ratio Analysis: AI, Remote Work Drive Better P/C Insurer Results
Expense Ratio Analysis: AI, Remote Work Drive Better P/C Insurer Results
In separate reports last week, AM Best and Morgan Stanley analyzed P/C insurance industry expense ratios, with one reporting a 2.4-point drop over the past decade and the other projecting another potential 2.0-point decline by 2030.
While both reports highlight the impact of AI and automation in driving down expenses, the AM Best report, which gives the historical take, also flags drops in rent expenses related to increased remote work as a factor.
Analyzing underwriting ratios of the 2014-2024 timeframe, AM Best noted that while the loss ratio declines, including a 5.4-point drop in the U.S. property/casualty insurance industry loss from 2023 to 2024, drove improved results in recent years, looking over the entire 11-year period, the expense ratio fell to 25.3 in 2024, compared to 27.7 in 2014.
10 Highest Class-Action Settlements in 2025 Eclipsed $70B Total: Duane Morris
The value of the 10 highest class-action settlements in 2025 exceeded $70 billion for the first time ever. In fact, the total was nearer to $80 billion across all areas of litigation, according to law firm Duane Morris.
For the fourth straight year, total settlements eclipsed the $40 billion mark.
Gerald L. Maatman, co-author of the Duane Morris Class Action Review and chair of the firm’s Class Action Defense Group, said the “implications are staggering.” FULL ARTICLE
Commentary/Opinion
Why pricing analytics is becoming essential for auto lenders
Auto lenders are facing one of the toughest operating environments in recent memory. Vehicle prices have risen sharply, borrowing has become more expensive, and competitive pressure has intensified across both direct and indirect channels. At the same time, lending teams are under pressure to maintain volumes, manage risk and protect profitability, often with fewer resources than before. Against this backdrop, traditional pricing approaches are no longer enough to keep pace with market volatility.
As a result, pricing analytics has shifted from being a “nice to have” to a fundamental capability. This is not about following trends or adopting analytics for its own sake.
Instead, lenders are turning to data-driven pricing to balance competitiveness with margin protection, using evidence rather than instinct to make decisions in increasingly complex markets.;
Earnix, a dynamic AI decisioning platform for the insurance industry, has put together a guide based on proven, real-world approaches already used by auto lenders that have successfully embedded pricing analytics into their operations. Rather than theory, it focuses on practical steps that deliver measurable financial impact when implemented correctly.
Insurance 2026: Progress Via Technology, Collaboration | Insurance Thought Leadership
P&C insurers face a more predictable 2026 landscape with profitable growth expected amid AI transformation.
The 2026 P&C insurance environment may be much easier to forecast compared with the last several years. Many experts have already said 2026 will be a year of profitable growth. Fitch suggests a combined ratio of 96% to 97%, and even the volatile homeowner market is anticipated to "stabilize." Similarly, it is obvious the new year will be filled with AI in insurance, building off widespread hype and numerous announcements of huge, multi-year investments by the likes of Travelers, Nationwide, GEICO, and Chubb. Just how much and deeply AI will affect insurance remains far less visible, with some areas of attention coming into focus, e.g., pre-binding, underwriting data, claims/FNOL analysis.
Caveats/The Future
If we have learned anything from recent history it is that the future is inherently uncertain. Not all of our predictions will materialize. Black swan events may occur, reshaping markets, nations and the insurance industry in dramatic, unpredictable ways. But we are confident that most of what we have forecast will become reality. Either way, our projection of optimism for a healthy and vibrant P&C insurance industry in 2026 tops the list.
We look forward to seeing the industry move forward, making progress through technology and collaboration. 2026 will be another exciting year for the industry in both expected and unexpected ways.
Alan Demers and Stephen Applebaum
AI in Insurance
Enabling AI-Driven Enterprise Transformation In The Insurance Industry
The insurance industry is at a pivotal moment. Historically reliant on manual processes and legacy systems, insurers now face mounting pressures: rising operational costs, evolving risk landscapes and heightened customer expectations for personalized, digital-first experiences. That makes artificial intelligence (AI) a critical driver of enterprise transformation across underwriting, claims, brokerage, advisory and customer engagement teams.
According to McKinsey researchers, generative AI (GenAI) alone has the potential to unlock significant productivity gains globally, and insurers are among the sectors best positioned to benefit most.
Barriers To GenAI Adoption In Insurance
Data Siloes: Insurance organizations often operate with fragmented legacy systems, making it difficult to establish a single source of truth for AI models.
Process Variance: Insurance processes vary widely across product lines, regions and business taxonomies. This variation affects model grounding and can reduce the consistency of output from the AI models.
Regulation And Compliance: Compliance with GDPR, FCRA and emerging AI-specific regulations adds layers of complexity. In a highly regulated industry, transparency and explainability are essential for adoption.
InsurTech/M&A/Finance💰/Collaboration
Catastrophe Risk Management Platform KatRisk Acquires Symfos to Accelerate Next-Generation Underwriting and Portfolio Risk Intelligence
KatRisk, a leading global provider of catastrophe risk models and climate analytics, today announced the acquisition of Symfos, the UK-based company behind the Orchestra underwriting and portfolio intelligence platform.
The acquisition brings together two complementary capabilities: KatRisk's ability to model climate and catastrophe risk, and Symfos' ability to help insurers apply that information directly to underwriting and portfolio decisions. Together, the companies will help insurance and reinsurance organizations move faster, price risk more accurately, and manage exposure more confidently in an environment where natural hazards are growing more complex and more costly.
As climate-driven events such as floods, storms, and wildfires become more frequent and unpredictable, insurers require tools that help translate risk insight into action. The combination of KatRisk and Symfos is designed to support that need by making risk data easier to use across underwriting, exposure management, and executive reporting.
"Symfos has built a powerful platform that helps insurers turn complex risk data into meaningful decisions," said Martyn Sutton, General Manager at KatRisk. "By bringing our teams and technologies together, we're making it easier for customers to bring clarity to complex risk and support more confident decision-making."
Boyd Group Closes $1.3 Billion Acquisition of Joe Hudson's Collision Center
Boyd Group Services Inc., the Canada-based parent company of Gerber Collision & Glass, announced January 9 that it has completed its acquisition of Joe Hudson's Collision Center, the largest deal in the collision repair industry since Crash Champions merged with Service King in 2022.
The transaction adds 258 collision repair locations across 18 states, primarily in the Southeast, increasing Boyd Group's North American footprint by 25% to 1,301 locations. Boyd remains the second-largest collision repair operator behind Caliber Collision.
"The closing of the acquisition of Joe Hudson's represents a transformative step for Boyd, further solidifying our position as a leading player in the highly fragmented North American collision industry," said Brian Kaner, president and CEO of Boyd Group, in the press release.
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