News
Senators Warren, Hawley Launch Probe into Rising Unpaid Home and Auto Insurance Claims
[Ed. Note: The topic of "Claims Without Payment" takes new and serious turn via bipartisan probe ahead of mid-term elections dominated by affordability narrative. See related article published Aug. 10, 2026 below]
AI STORY SUMMARY
- Senators Elizabeth Warren and Josh Hawley have opened a probe into how leading home and auto insurers handle claims, after reports that a record share of claims are being closed without payment.
- They wrote to executives at State Farm, Allstate, USAA, Farmers, Liberty Mutual and American Family, citing a Wall Street Journal report that 44% of home insurance claims and 45% of auto liability and medical claims were denied in 2025, up from 36% and 35% a decade ago.
- The senators warned that the surge in unpaid claims coincides with a 70% rise in homeowners premiums nationwide from 2019 to 2025, and that 12% of Americans now lack home insurance, up from 5% in 2019.
- They also raised concerns that insurers’ record profits may be driven by aggressive claims‑handling tactics that delay payments.
- The senators have requested information on these practices by October 16, 2026, and the probe has been highlighted by the Wall Street Journal and echoed in tweets from both senators.
Auto Insurers Pay Nothing on 45% of Claims
[Ed. Note: It is tempting to dismiss this report, knowing that "closed without payment" (CWP) ratio is mostly for monitoring claim productivity. Opened claims minus paid claims (CWP) would be unreliable and deficient to gauge fairness in claims settlements or insurer profitability. Metrics such as average net claim payment, reopen rates, claims settled within 30/60/90 days, percentage of attorney representation and reserving accuracy trends are more meaningful to insurers. Either way, sentiments of skepticism and distrust are noteworthy]
Auto Insurers Pay Nothing on 45% of Claims
Auto insurers closed 45% of resolved liability and medical claims without making a payment in 2025, up from 35% a decade earlier, The Wall Street Journal reports.
The figures do not mean every unpaid claim was denied. Insurers said claims can close without payment because another company paid, the customer withdrew the claim, the loss fell outside the policy or damages were below the deductible.
Still, insurers are paying a smaller share of their premium revenue toward claims.
Personal auto insurers paid about 61 cents in claims for every dollar collected in premiums last year, the industry's lowest net loss ratio since 2020, according to S&P Global Market Intelligence.
"The industry uses claim lowballing and denials to wring extra profit out of customers who don't have the resources or, in some states, the rights to fight back," Consumer Federation of America insurance director Douglas Heller told The Journal.
Financial Results
Large Commercial Property Rates Drop 14.5% in Q2 to Highlight Latest Willis Report
Large Commercial Property Rates Drop 14.5% in Q2 to Highlight Latest Willis Report
Commercial property rates continues to soften, according to a new report from Willis, a WTW business.
Large and complex property rates with WTW’s portfolio dropped 14.5% in the second quarter of 2026, according to the fall 2026 edition of its Insurance Marketplace Realities report. This is compared to a decline in rates of 8.4% during the same time a year ago. CONTINUED
AI in Insurance
Sapiens Launches Sapiens Brain, the Insurance-Native AI Foundation Powering SapiensAIP
Sapiens International Corporation N.V. ("Sapiens") today launched Sapiens Brain, the proprietary AI foundation at the heart of SapiensAIP, the company's recently announced AI platform for the insurance industry. Sapiens Brain codifies decades of Sapiens' insurance domain expertise – including millions of lines of code, product documentation and design artefacts – into an insurance-native foundation that grounds AI models in the language, logic and regulatory reality of insurance.
"There's a unique pressure within our industry to modernise, and AI is the key to unlocking that," said Paul Wheeler, Chief Executive Officer, Sapiens. "To be a disruptive player in insurance, we have taken AI further than any of our competitors. The unique combination of SapiensAIP and Sapiens Brain allows agents built outside our core systems to behave as though they were born within them – grafted back in like tissue, not bolted on like a robotic limb."
FurtherAI Wins AI Implementation of the Year at the 2026 Insurance Insider US Honors
FurtherAI, the AI transformation partner for insurance, announced that it has been named AI Implementation of the Year at the 2026 Insurance Insider US Honors.
The award recognizes FurtherAI for its innovative application of AI and data-driven technology across the insurance policy lifecycle. According to the judges, FurtherAI stood out for delivering “clear and measurable benefits for clients,” supported by strong customer testimonials and a proven track record of successful implementations at scale.
“AI implementation is where the promise of AI meets the realities of enterprise insurance,” said Aman Gour, Co-Founder and CEO of FurtherAI. “This recognition reflects what we’ve learned alongside our customers: delivering real value with AI requires more than powerful technology. It requires deep integration into existing workflows, measurable business outcomes, and the ability to drive adoption across an organization. We’re proud to be trusted by some of the industry’s leading organizations and excited about what we’re building together.”
Insurtech SecondSight raises Series A, names Jamie Bouloux president
SecondSight, a provider of an AI operating system built for insurance, has closed its Series A funding round and appointed Jamie Bouloux, former CEO of Ryan Financial Lines and Celerity Risk, as presiden. The company said the funding will support organizational growth and product development as it expands beyond cyber insurance into additional lines of business.
SecondSight’s SHAPE operating system is designed to learn from insurers’ internal data alongside live external signals. The platform analyzes relationships across policies, premiums, claims and exposures, giving brokers, underwriters and executives a clearer view of how risks are connected and changing. The company works with large insurers across distribution, underwriting and reinsurance. SecondSight said SHAPE is intended to support decisions around premium growth, loss ratios and capital allocation rather than focus solely on workflow automation.
Bouloux will lead SecondSight’s commercial strategy and client relationships while overseeing its expanding team of insurance specialists. He brings nearly 20 years of experience across cyber, underwriting, specialty insurance and insurance technology.
Carriers Must Govern AI Use in Agencies | Insurance Thought Leadership
Somewhere in your distribution channel this morning, a producer pasted a prospect's declarations page into ChatGPT and asked for a plain-English summary.
An account manager drafted a coverage explanation in Claude. Someone on the claims side wrote up a loss narrative in Copilot, because it came with the Microsoft license. Nobody at the agency decided which tools were approved, what client data could leave the building, or who'd read the output before it reached the insured, because nobody was asked to decide.
That's rarely recklessness. In most agencies it's a decision no one owns.
Elsewhere in the industry, generative artificial intelligence is being treated like any other emerging risk. Last fall, ISO gave carriers three optional endorsements that exclude generative AI losses from the standard commercial general liability policy, which is the industry's way of saying it considers AI a distinct peril. Roughly half the states have adopted the NAIC's model bulletin on how insurers use AI. Inside carriers and MGAs, governance programs are being written so there's something to show an examiner. That's all good work. None of it reaches the agency down the street that sells your policies.
The Big "I" ACT 2026 Tech Trends Report found that 55% of independent agencies have no written AI use policy, and another 23% are still drafting one. Those agencies are your distribution channel.
Climate/Resilience/Sustainability
Extreme weather damage is leaving homeowners with long-term household debt, Hippo report finds
Third annual report shows that half of U.S. homeowners paid out of pocket for weather damage in the past three years and only 22% feel very financially prepared for an unexpected weather repair
- Nearly 80% of homeowners are not financially prepared for an unexpected weather-related repair, lacking either the savings to cover the cost or the ability to complete the work themselves
Hippo Holdings (NYSE: HIPO) today released its third annual Extreme Weather Report, revealing the lasting financial consequences of weather-related home damage. Based on a survey of 1,047 homeowners across the United States, the report found that nearly a quarter of homeowners who paid out of pocket for weather damage are still carrying debt from it. Among those carrying debt, 71% have carried it for at least two years.
The report shows how the financial effects of home damage extend beyond repairs into savings, retirement contributions, and households' ability to prepare for the next unexpected expense. Released as homeowners prepare for colder weather, it examines both their readiness to protect their homes and their understanding of what insurance will cover if damage occurs.
"Protecting a home means protecting the financial future of the people inside it," said Rick McCathron, president and CEO of Hippo. "When a single weather event can push homeowners into years of debt, the damage extends far beyond the property. The insurance industry must move upstream like we've been doing at Hippo since inception, helping homeowners understand their coverage, prevent avoidable damage, and prepare before severe weather hits."
Announcements
Insurtech America
October is a big month for the InsurTech America community.
The Innovation Challenge is entering its final stretch, submissions close October 7, and later this month we’ll reveal the startups moving forward as finalists. From there, the spotlight shifts to Hartford Innovation Week, where those finalists will take the stage, pitch their ideas, and compete for cash prizes—including an opportunity for one startup to pursue a $1 million investment.
But the Innovation Challenge is just one part of what’s happening across the community. Hartford Innovation Week is bringing together founders, carriers, investors, operators, and industry leaders for a packed calendar of conversations and events—and our local InsurTech communities are keeping that momentum going with opportunities to connect, learn, and build relationships.
This is the part of innovation we love most: not just talking about what’s next, but creating the rooms where the people shaping it can actually meet.
Insurity and ReSource Pro Expand Partnership to Accelerate Insurance Modernization and Operational Transformation
Insurity, a leading provider of cloud-based software for insurance carriers, brokers, and MGAs, today announced the expansion of its existing partnership with ReSource Pro, an insurance-focused services and technology company that helps insurance organizations improve operations, strengthen execution, and achieve measurable business outcomes.
Building on an already established relationship, the expanded collaboration connects Insurity’s cloud-based insurance platforms with ReSource Pro’s experience across insurance operations, technology services, managed services support, and process improvement. Together, the companies will help carriers, MGAs, and brokers reduce delivery friction to improve implementation outcomes and build more scalable operating models across additional Insurity product sets.
“As our work with ReSource Pro continues to expand, we see an opportunity to help customers connect technology modernization with the operational changes that make transformation successful,” said Jeff Weiner, AVP, System Integrator Alliance Partnerships at Insurity. “ReSource Pro brings deep insurance knowledge and practical delivery capabilities that complement Insurity’s core platforms. This expanded relationship will help insurers move from strategy to execution with greater confidence and realize more value from their investments.”
Fraud
Your Family Member Is Calling for Help. But Is It Really Them?
A frantic phone call from a child, spouse or parent asking for money can trigger an immediate instinct to help. But with artificial intelligence making it easier for criminals to imitate a person's voice, consumers may need to stop and verify who is really on the other end of the line.
With October being CyberSecurity Awareness Month, Mercury Insurance (NYSE/NYSE TX: MCY)is encouraging consumers to recognize the growing threat of AI-powered impersonation scams and take simple steps to protect themselves and their families. According to the FBI's 2025 Internet Crime Report, more than 22,000 complaints involving artificial intelligence resulted in nearly $893 million in reported losses. The FBI has identified voice cloning and other forms of AI-generated content among the tools criminals are using to make scams more convincing.
"Scammers have always relied on urgency and emotion, but AI can make those tactics much more believable," said **Dustin Howard, Head of Information Security at Mercury Insurance88. "Hearing what sounds like the voice of someone you love can cause you to react before you have time to question what you're hearing. That feeling is exactly what the scammer is counting on."
Claims
What is the Auto Lab at Allstate Claims University? How Allstate trains auto claims adjusters on modern vehicle damage
Allstate's Auto Lab uses real vehicles, diagnostic technology and hands-on training to help claims adjusters identify hidden damage that may not be visible...
Key takeaways:
- Allstate's Auto Lab features 22 vehicles and four motorcycles, including electric, hybrid and gas-powered models, allowing claims adjusters to gain hands-on experience with the vehicles and technologies customers drive today.
- The lab was designed using insights from more than 3.5 million auto claims to mirror the most common vehicle damage scenarios and repair challenges customers experience.
- Advanced training tools, including vehicle lifts, repair demonstrations and diagnostic technology, help claims adjusters build deeper expertise, supporting more informed assessments and clearer guidance for customers.
The Auto Lab at Allstate Claims University is a hands-on vehicle training facility where claims adjusters evaluate real damaged vehicles and gain firsthand experience with the technologies shaping today's repairs. The Auto Lab is one of two hands-on training environments inside Allstate Claims University, the company's 33,000-square-foot claims training center in Dallas, Texas, which opened in August 2026. Designed using insights from more than 3.5 million auto claims, the Auto Lab features 22 vehicles and four motorcycles and recreates the damage scenarios customers experience most often, helping prepare claims adjusters to guide customers through the repair process.