News
Cox Automotive: Parts, Repair Cost Inflation Climb as Fed Signals Possible Rate Hikes
Vehicle accessories and parts prices rose 6.6% year over year in July, the sharpest increase since March.
For collision repair shops, two numbers in Cox Automotive's Aug. 31 report land directly on the cost side of the business: what shops pay to keep parts in stock, and what customers can afford to spend once a repair bill arrives.
In July, the cost of vehicle accessories and parts stood 6.6% above where it was a year earlier, the sharpest instance of parts inflation since March, according to Cox Automotive's Aug. 31 Auto Market Weekly Summary. The report, credited to Cox Automotive Chief Economist Jeremy Robb, also pointed to a shift in Federal Reserve policy signals that could keep vehicle financing rates elevated into the fall.
PARTS AND REPAIR COSTS OUTPACE VEHICLE PRICES
A broader spending group in the report folds together public transit, vehicle leasing and what people spend keeping a vehicle running, and that combined figure rose 7.1% in July compared with a year earlier. Driving that total: a 17% jump in airfare, a 7% increase in mass transit fares, and a rise of just under 7% in vehicle maintenance and repair spending. The report did not break out a separate figure for vehicle leasing's contribution.
Vehicle prices themselves showed a smaller footprint. New models carried a modest 0.6% year-over-year increase, while buyers of used vehicles paid roughly 2% less than they would have a year earlier.
The Fed just doubled its AI risk warning. Here's what it means for US cyber insurers
Frontier AI poses the single most immediate threat to the global financial system
Two of the world's most closely watched financial regulators have delivered the same message within days of each other: artificial intelligence is no longer a future risk to the financial system. It's a current one, and it's accelerating.
The Federal Reserve's Spring 2026 Financial Stability Report found that 50% of the market participants it surveyed cited AI as a salient risk to US financial stability, up sharply from 30% just six months earlier in the fall 2025 survey. Then, earlier today, Bank of England governor Andrew Bailey went further in his own letter to G20 finance ministers, written in his capacity as chair of the international Financial Stability Board (FSB), naming frontier AI's impact on cyber risk as the single most immediate threat to the global financial system.
Two regulators on two continents, arriving at the same conclusion in the same fortnight. For carriers and brokers writing cyber in the US, that timing is hard to treat as a coincidence.
Building Trusted Insurance Brands: Less ‘Gotcha’ at Farmers
Less "gotcha." More "we got you." Whether it's the new website banner, a chorus dressed in light pink singing a jingle on TV commercials
Executive Summary
"Farmers Coverage on a Page" and Farmers Coverage Review sessions are two features of a refreshed approach at Farmers aimed at delivering more transparent insurance experiences to customers. Here, Christine Buxton, senior vice president and head of service transformation, a 23-year veteran of the company, explains how clearer communications—delivered by Farmers agents, in direct-to-customer materials and during moments of claims—build customer trust in the carrier. More “we got you.”
Whether it’s the new website banner, a chorus dressed in light pink singing a jingle on TV commercials, or popups in the middle of articles about insurance (I get a lot of those), the message from Farmers Insurance is clear: Clarity is the idea.
Christine Buxton, vice president and head of service transformation at Farmers, didn’t use the term “gotcha”
Commentary/Opinion
The Integrity Deficit: The Promise and The Erosion
Editor's note: This is the first installment in a four-part series on the erosion of integrity in property claims. Part I measures the decline. Part II
Two forces have hollowed out that model. The first is the loss of experienced judgment. Roughly one in four claims adjusters is expected to retire within five years, and turnover among newer adjusters runs high. The people leaving spent decades learning to read a loss, to spot an inflated estimate, and to push back, politely but firmly, on an aggressive contractor or attorney. Those arriving are often handed heavier and more complex caseloads with a fraction of that seasoning. Deloitte research reports that carriers relying on underprepared talent see materially higher indemnity payouts, on the order of 20%, because inexperienced adjusters cannot always tell a fair number from an unfair one. When judgment leaves the building, the file does not get more honest. It gets more arbitrary.
Lane Johnson is the founder of Johnson Dispute Resolution, a carrier-side appraisal and dispute resolution firm based in Texas
State News
L.A. County sues State Farm over its handling of wildfire claims
L.A. County announced Monday that it had filed a lawsuit against State Farm General after hundreds of victims of last year’s devastating wildfires complained that their policy claims had been delayed, denied or underpaid.
Los Angeles County has filed suit against State Farm, alleging illegal, deceptive practices that delayed, denied and underpaid claims for victims of the Palisades and Eaton wildfires.
County investigators say the insurer systematically underpaid and suppressed smoke-damage claims, leaving families unable to afford toxin testing or remediation and turning insurance into a barrier to long-term recovery.
State Farm counters it has paid more than $6.2 billion and closed most claims, as the county seeks full restitution and civil penalties from California’s largest home insurer.
The lawsuit alleges that State Farm engaged in illegal and deceptive business practices that kept victims of the Palisades and Eaton fires from receiving what they were entitled to under their policies.
AI in Insurance
Where is generative AI creating value in insurance today?
The potential of generative AI has caused a widespread race across the insurance sector.
Firms are undergoing various pilots and tests to see where the most value can be found, but where is the real value coming from?
Firms have spent the past few years experimenting with generative AI, but the time for pilots is coming to an end and firms are looking to move into real deployment of the capabilities. A recent report from Celent on the state of generative AI within insurance found that 48% of insurers it surveyed are currently in production with generative AI. It anticipates this to exceed half of firms by the end of the year.
As firms move ahead with their deployments, this raises the question of where these tools are creating value today.
Speaking to FinTech Global, Matthew Twist, vice president, EMEA at Earnix, explained, “Every technology wave arrives with the same promise: it’ll change everything. Insurance has learned, sometimes the hard way, that technology only matters if it improves decisions. The interesting conversations have changed. A year ago, everyone wanted to know what generative AI could do. Today, they are asking where it delivers measurable value.”
You Know Who Really Hates AI? Insurance Claims Adjusters
Of the Glassdoor reviews from claims adjusters that mentioned AI, a staggering 98 percent were negative. “AI is just a tool,” one person tells WIRED. “It should never be given the keys.”
ON THE JOB review platform Glassdoor, one faction hates artificial intelligence more than any other.
Pushing AI to the point that you are asking humans not to use their thoughts and brains is such a turn off,” reads one representative review. “Stop forcing AI onto everyone,” reads another. And then there’s this one: “The AI apps this company uses are all trash.”
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Take Ahmad Jackson. About a year ago, he was working in the claims department for a major insurance company. His employer decided to use AI for initial loss reporting, which involves setting up claims and gathering information when someone first discloses an incident. It was supposed to be a boon for employees and policyholders alike, streamlining simple claims while transferring more complex situations to actual people.
Research
US Construction Firms Face Gap Between Booming Property Insurance and Punishing Casualty Rates
Construction spending topped $2.17 trillion in April 2026 amid labor shortages, rising claim severity and a bifurcated insurance market, according to Gallagher.
Despite increased U.S. constructing spending in early 2026, the outlook for growth remains uneven depending on the type of construction project, according to Gallagher’s mid-year 2026 industry update.
Total U.S. construction spending reached an annualized rate of $2.17 trillion in April 2026, up from a revised $2.16 trillion in March 2026, according to the U.S. Census Bureau. While public infrastructure, data centers and advanced manufacturing saw increased activity, office, hospitality and single-family residential construction lagged, Gallagrer said.
Recommended Events
ITC Vegas | Horizon of Possibilities
ITC Vegas September 29, 2026 - October 1, 2026
The largest insurance innovation event in the world - Predict, Prepare, Progress
From the shore, the ocean can appear calm. Yet, under the surface, tectonic plates shift, pressure builds, and currents redirect—long before we detect movement. That’s insurance right now. Climate, technology, regulation, and human behavior are reshaping risk in real time. Change isn’t coming; it’s already here. The real question is how we move forward.
We set our sights on the horizon and turn insight into action.
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