News
US P&C insurance industry improving but geopolitical and cat risks loom: Triple-I
The US property and casualty (P&C) insurance industry is improving, driven by favourable underwriting conditions as key economic driver stabilise and claims-cost pressures begging to ease, according a new report by Insurance Information Institute (Triple-I) and Milliman.
The report finds that major insurance lines are projected to see stronger underwriting performance through 2028, outpacing the growth of the broader US economy despite looming geopolitical risks and sever weather events.
Michel Léonard, Ph.D., CBE, chief economist and data scientist at the Triple-I, said: “Our latest economic forecasts for the P/C industry have improved since earlier this year.
“P&C underlying growth, a key economic driver of existing and new business premium volume growth, is expected to outpace overall US GDP growth through 2028. Even with that momentum, we continue to see significant risks to P&C economic drivers especially in the rest of 2026, including but not limited to inflationary pressures caused by the Persian Gulf conflict.”
According to Triple-I’s current forecast, these geopolitical tensions will ease during the second half of the year, though uncertainty remains high.
Financial Results
Progressive's Q2 Earnings Beat Estimates, Premiums Rise Y/Y
Behind the Headlines
- Net premiums written were $21.1 billion in the quarter, up 5% from $20.1 billion a year ago.
- Net premiums earned grew 6% to $21.6 billion. The reported figure met the Zacks Consensus Estimate.
- Net realized gains on securities were $604 million, up 56% year over year.
- Combined ratio — the percentage of premiums paid out as claims and expenses — deteriorated 110 basis points (bps) from the prior-year quarter's level to 87.1.
June Policies in Force
- Policies in force were solid in the Personal Lines segment, up 8% from the year-ago month's figure to 38.9 million. Special Lines improved 7% to 7.3 million.
- In the Personal Auto segment, Agency Auto increased 8% year over year to 11.2 million, while Direct Auto increased 10% to 16.7 million.
- Progressive's Commercial Auto segment policies rose 3% year over year to 1.2 million. The Property business had 3.6 million policies in force, up 1%.
Allstate’s pre-tax catastrophe losses for Q2’26 reach $1.72bn
US insurer Allstate has announced an estimated pre-tax catastrophe loss burden for the month of June 2026 of $563 million. But the second-quarter 2026 total has now risen to $1.72 billion, which is a fairly heavy start for the annual aggregate year for the company’s catastrophe bonds.
Allstate begun the new annual aggregate risk period, that its Sanders Re program catastrophe bonds and excess of loss reinsurance are subject to, with $870 million of pre-tax catastrophe losses in April 2026.
Then following a relatively low month of catastrophe losses in May, at $289 million pre-tax, Allstate’s total pre-tax cat losses then rose to $1.16 billion,
Now, combined with June’s $563 million, Allstate’s total catastrophe losses for Q2 2026 are $1.72 billion, or $1.36 billion, after-tax. This is a slight decline from last year, where Allstate reported estimated catastrophe losses of $1.99 billion, or $1.57 billion after tax, for the second quarter of 2025.
Travelers Q2 Earnings Beat Estimates on Lower Catastrophe Losses
Travelers generated core income of $2.16 billion, up 44% year over year, while net income increased 46% to $2.21 billion.
Net investment income rose 14% year over year to $1.07 billion pre-tax ($883 million after tax), benefiting from a higher yield on the long-term fixed-income portfolio and growth in average invested assets. Catastrophe losses narrowed to $518 million pre-tax from $927 million a year earlier. Net favorable prior-year reserve development improved to $578 million pre-tax from $315 million.
Travelers Revenue and Profitability Trends
Total revenues, excluding realized investment gains, were $12.09 billion, nearly flat year over year and below the consensus estimate. Net written premiums of $11.53 billion were essentially unchanged from the prior-year quarter. Excluding the impact of the Canadian business divestiture, net written premiums increased 2%.
The combined ratio improved 670 basis points year over year to 83.6%, reflecting lower catastrophe losses, stronger reserve development and a better underlying combined ratio. The underlying combined ratio improved 60 basis points to 84.1%, while underlying underwriting income reached $1.68 billion pre-tax.
State News
Court Upholds Lara's Endorsement Of Insurer Discrimination, Says Consumer Watchdog
A divided California Court of Appeal today upheld Insurance Commissioner Ricardo Lara's decision to allow insurance companies to charge Californians more for auto insurance simply because they are unmarried. Consumer Watchdog filed an amicus brief with the Court of Appeal noting that the voters made the Civil Rights Act apply precisely to prevent the kinds of discrimination that insurance companies once used, and did not give the Insurance Commissioner – which Prop 103 made an elective office – the right to overturn the civil rights laws.
The published decision in Ison v. Lara permits insurers to continue using marital status as an optional rating factor, allowing higher premiums for widows, divorcees, single parents, and other unmarried drivers. Farmers Insurance intervened in the case alongside Commissioner Lara to defend the discriminatory regulation.
The opinion notes allegations that unmarried drivers are charged approximately $56 to $100 more than married drivers for the same auto insurance coverage as a result of insurers' use of marital status as a rating factor.
Telematics, Driving & Insurance
JD Power ranks Nationwide best in customer satisfaction among usage-based auto insurers for third straight year
For the third time in as many years, the annual JD Power U.S. Auto Insurance Study ranks Nationwide #1 in Customer Satisfaction among usage-based insurance (UBI) Auto Insurers
About the award: The JD Power 2026 U.S. Auto Insurance Study measures customer satisfaction with auto insurance in 11 geographic regions. A separate category that addresses UBI, along with diagnostics that influence UBI participants’ experience with their insurer’s usage-based auto products, ranks Nationwide as the top auto insurer for usage-based insurance.
What we’re saying: “Nationwide recognizes that customers want insurance solutions that are as smart and connected as the world around them,” said Casey Kempton, President, P&C Personal Lines for Nationwide. “Usage-based insurance delivers that by combining technology, innovation and practical insights to help drivers improve habits and make roadways safer for everyone.”
Starting “Smart” in 2012: Nationwide launched its first UBI product, SmartRide®2 in 2012 followed by SmartMiles® 3 in 2019 as options for drivers seeking products that personalize rates based on driving habits.
AI in Insurance
Document extraction was the easy AI win – growth is next
The insurance industry’s AI conversation is moving past experimentation and toward a more demanding question: where is the return?
Speaking during the AI Revolution – From Hype to ROI panel at InsuranceFest 2026, executives from insurers, brokerages and technology providers said the most credible near-term gains are still being found in document processing, workflow automation and employee productivity.
But the more ambitious opportunity may lie beyond cost reduction. Panelists argued that better data, faster underwriting and lower-friction distribution could eventually help insurers write more business, improve profitability and address parts of the protection gap.
Doug Alexander (pictured left), senior vice president and chief technology officer at Upland Specialty Insurance, said the carrier has seen measurable benefits from document extraction.
“What we’re seeing in the AI space is we’re getting a lot of benefit out of document extraction and being able to automate some of that manual, tedious work, and we can measure the ROI with it,” he said.
Truyo Introduces Truyo Trust, Offering Up to $1 Million in Protection for Qualified AI Governance Customers
Truyo, the leader in managing AI compliance and risk, today announced the launch of Truyo Warranty Certification Program, a new offering that provides qualified customers with financial protection for their privacy compliance and AI governance programs.
Available through Truyo's Compliance Advisor and AI Governance solutions, the program is designed to help organizations address growing regulatory, enforcement, and litigation risks while strengthening confidence in their compliance posture. Unlike traditional software warranties that focus on performance and availability, Truyo Trust is designed to address compliance, regulatory, and litigation risks tied to privacy and AI governance programs.
"Organizations are entering a new era of AI and privacy regulation where enforcement actions, litigation, and financial penalties are becoming a real business risk," said Dan Clarke, President of Truyo. "Companies need more than software. They need confidence that their compliance program will stand up to scrutiny. We're so confident in our platform and certification process that we're willing to stand behind it with a warranty. That's what the Truyo Warranty Certification Program represents."
Aon expands Data Center Lifecycle Insurance Program to $5 billion with Reliable by Design Approach to Digital Infrastructure
Aon plc (NYSE: AON), a leading global professional services firm, today announced the next evolution of its proprietary Data Center Lifecycle Insurance Program (DCLP), expanding program capacity to $5 billion while broadening the integrated risk solutions that support digital infrastructure assets from development through long-term operations.
"Digital infrastructure has become one of the most important and capital-intensive asset classes in the global economy," said Joe Peiser, CEO of Risk Capital for Aon. "As clients build larger and more complex data center portfolios, they need access to greater insurance capacity alongside solutions that strengthen resilience throughout the asset lifecycle. Expanding DCLP to $5 billion demonstrates our ability to help clients access capital, manage risk and scale with confidence."
Research
SHIFTING PATTERNS IN HOME INSURANCE LOSS TRENDS
Severe weather events, rising claims costs and shifting loss trends continue to challenge insurers across the country.
The newly released 2026 LexisNexis® U.S. Home Trends Report provides seven years of loss cost, claims frequency and severity data to help inform underwriting and pricing strategies.
Key findings include: - All Peril severity increased 93.2% since 2019. - Fire and Lightning loss cost rose 76.8% from 2024. - California recorded the highest All Peril loss cost in 2025, driven by the Los Angeles wildfires.
The report also examines trends across fire, wind, hail, lightning, weather-related water, non-weather-related water, theft, liability and other perils.
People
Nationwide’s Jeff Rommel to retire in January 2027
After more than four decades of leadership and service, Jeff Rommel, senior vice president, Personal Lines Operations, will retire from Nationwide on Jan. 31, 2027.
Rommel joined Allied Insurance, a Nationwide company, in 1985 as a claims representative. During his 41-year tenure with Nationwide, he has held various leadership positions across claims, sales, distribution and operations.
Since assuming the role of senior vice president of Personal Lines Operations in October 2024, Rommel has helped transform the experience Nationwide delivers by advancing service, ease and trust, while helping the organization sharpen its focus on customer outcomes and build capabilities that contributed to industry-leading experiences.
Throughout his career, Rommel’s deep knowledge of the Personal Lines value chain has helped deliver the company’s mission to protect people, businesses and futures with extraordinary care.
“Jeff’s leadership has made a lasting impact on our company and on the people who have worked alongside him,” said Mark Berven, president and COO, Property & Casualty for Nationwide. “Jeff helped lead the business through important moments with a steady hand, a clear focus on our customers and a commitment to building strong teams.”
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