Property insurance claim volume declined to a five-year low in the first quarter of 2025, even as large-scale natural disasters pushed claim severity and overall costs higher, according to Verisk’s latest Quarterly Property Report.
The report, which covers data from January through March 2025, found that total property claim volume dropped by approximately 7% compared to the same period in 2024. The decline was largely attributed to a reduction in non-catastrophe (non-cat) claims. Catastrophe-related (Cat) claims remained consistent with levels observed in recent quarters.
While overall frequency fell, the severity of reported claims increased sharply, particularly in California. The state’s Palisades and Eaton wildfires generated an estimated 48,000 claims totaling close to $10 billion.
Verisk reported that the average claim from these fires was approximately $337,000. Replacement cost value (RCV) across the US rose 46% year-over-year, with California alone seeing a 1,805% increase in RCV from Q1 2024.
For insurers, the figures reflect a continued shift toward lower claim frequency but higher individual claim costs, especially in regions experiencing large-scale events. Although 33 states recorded a year-over-year decrease in claim severity – ranging from 80% to 95% in places like Maine, Delaware, Montana, and Oregon – the overall impact of major disasters offset those declines.
Texas led the country in overall claim volume during the quarter, with approximately 161,000 claims filed, followed by California (96,600), Florida (48,500), Missouri (48,200), North Carolina (36,000), and Pennsylvania (35,700).
Texas also accounted for 95% of all Q1 CAT events, largely driven by wind and hail. Other states, including Kentucky and Nebraska, experienced increases of over 200% in CAT claims, primarily associated with tornado-related weather.
The report also observed regional declines in certain weather-driven claim types. Washington recorded a 99% reduction in freeze-related claims, while Oregon and Maine reported decreases of 98% in ice, snow, and wind claims, respectively.
In addition to claims trends, Verisk noted a moderation in billable labor cost growth. Labor costs rose 1.06% nationally in Q1, compared to a 1.42% increase in the previous quarter. The report also pointed to potential cost pressures tied to construction inputs, noting the insurance industry’s exposure to fluctuations in labor availability and material prices, influenced by US immigration and trade policy.
