High insurance costs still plague Georgia

(The Center Square) – Georgia is one of the least profitable states in the nation for insurance companies, a trend that could lead to premium increases unless lawmakers act, according to a Georgia House of Representatives committee.

Georgia has over 400 personal home and automobile insurers, and approximately 500 commercial line insurers, according to Rob Hoyt, Professor of Risk Management and Insurance at the University of Georgia, who spoke to the Blue-Ribbon Study Committee on Insurance Rates at its final meeting. However, some insurers have pulled out of Georgia, he said.

While Georgia is the tenth-largest state for Property and Casualty premiums, it ranks 50th out of 51 among the states and D.C. for insurance company profitability, Hoyt said. If profitability continues to lag, companies could choose to reduce capacity which would drive up premium costs. Other issues that drive up premiums include inflation, medical costs and litigation trends and costs.

The average business liability claim costs $97,220, according to the 2025 National Small Business Risk Index. That’s an increase of 18% from 2022 due to increasing medical expenses and increased litigation, Hoyt said.

Insurance Agent Mike Royal told the committee that in his 30 years working in insurance, the current market has been “hard plus some,” mostly due to a lack of choices and competition in the market.

“We have seen good carriers leave,” said Royal. “They’ve taken their capital elsewhere.”

However, he said he’s hopeful for the tort reform passed last year.

“In my opinion as someone who has 4,000 clients and sees claims on a daily basis, the pendulum has gone too far to one side and it needs to come back in the middle and settle there somewhere. What I would ask, and please encourage, is let what you did last year work. It took about three years to see significant differences in Florida and their tort reform.”

Florida saw the average rate decrease by about 6.5% last year, Royal said.

Insurance Commissioner John King said he expects more companies to withdraw from the market. He didn't appear at the committee's final meeting but said on social media he plans to ask lawmakers to consider two items in 2026.

“First, my office should be able to issue larger individual fines against big insurance companies. Overall, I’ve fined them more than any Commissioner in Georgia history, but I’ve had to do so through countless $2,000 fines. That needs to change. We’ve got plenty of carrots. We need to be able to enter the room with a bigger stick. Second, we need to cap excess profits auto insurance providers are reaping on GA families. It’s brought rates down elsewhere without providers pulling out of the market. We owe it to Georgians to try it here,” King wrote on X Thursday.

Several insurance companies have recently announced rate decreases in the state. Liberty Mutual and Citgo both announced rate drops of 5% for Georgia drivers, while State Farm has reduced its rates by approximately 10% over the course of the year, according to the Georgia Department of Insurance.

Chairman Matt Reeves said he expects multiple pieces of legislation to come out of the committee.