Insurer profits surge, but Connecticut homeowners shouldn't expect lower premiums

Jan. 24—Despite U.S. property and casualty insurers seeing an 840% improvement in underwriting results over the first nine months of 2025 — a stretch that included the Los Angeles wildfires — homeowners should not expect any drop in premiums this year, analysts say, though a recent cycle of double-digit percentage increases may ease.

U.S. carriers reported $35 billion in underwriting income through the third quarter, up from $3.7 billion over the first nine months of 2025, according to AM Best.

Insurers took a big hit in last year's California wildfires, with claims totaling more than $40 billion, according to Aon. But hurricane activity was lower than in past years on the Eastern Seaboard. While Hurricane Melissa caused extensive damage in Jamaica as the third most intense Atlantic basin storm on record — a Melissa gust above the ocean was reported at just over 250 mph — the storm system's U.S. impact was limited mostly to localized flooding, including in Connecticut.

And insurers say they are weathering President Donald Trump's tariffs on imports, which have yet to have a significant effect on overall claims costs.

Carriers are still building up reserves against any future claims, including after catastrophic weather events, according to AM Best, and are unlikely to drop premiums significantly this year on homeowners and auto insurance. Executives with Travelers, a major Hartford-area employer, suggested the company is on a similar track for the time being, during a Tuesday conference call with investment analysts.

Travelers had the biggest book of homeowners insurance in Connecticut in 2024, according to data published by the Massachusetts-based trade publication Agency Checklists, with $237 million in premiums written for a 10% market share. Travelers had the second-best loss ratio after Chubb among the biggest homeowners insurance carriers in Connecticut, with other major homeowners insurance carriers including Allstate, Liberty Mutual, State Farm and USAA.

The Connecticut Insurance Department reported a 13.5% increase in homeowners insurance rates across all companies that year.

Asked by an analyst whether the company expects any pressure from insurance regulators on the cost of homeowners and auto insurance, Travelers CEO Alan Schnitzer said two "good" years of underwriting profits had been preceded by two years of losses on that front.

"We certainly understand the affordability issue and think it's an important one for all of us to be focused on," Schnitzer said. "When you think about personal insurance results over a period of time — I mean, certainly in our case — you wouldn't say that we're over-earning. ... We are trying to get the right price on the risk and earn a fair return for helping customers manage their risk."

The Insurance Information Institute reported an average Connecticut homeowners policy of $1,814 in 2022, 10th highest in the country that year. But the range of premiums is far wider, according to a CT Insider review of U.S. Department of Treasury data preserved online by the Consumer Federation of America.

Depending on the house and location, Connecticut premiums swung that year from an average above $8,900 in a swath of Greenwich from the shore to the town's "back country" section; to just under $1,250 on average in Plainville and Torrington.

The Treasury department has not posted claims data for U.S. municipalities and neighborhoods for 2023. In nearly 60% of Connecticut municipalities and neighborhoods, premiums were flat or dropped between 2019 and 2022, before most homeowners insurance premiums swung upward as a result of inflation that increased claims costs for carriers.

And in Connecticut and nationally, some homeowners are being forced to shop for new policies after getting nonrenewal notices from their existing carriers who are trying to limit their exposure based on claims activity, whether due to storm exposure or the condition of homes. The Connecticut Insurance Department launched a free online tool last year to help people gauge the risks to their property, at firststreet.org.

In 2022, the East Side neighborhood of Bridgeport had the highest nonrenewal rate for homeowners insurance in Connecticut, according to the Treasury data set. About 3.2% of property insurance policies were not renewed that year in the East Side, with Bridgeport having several other neighborhoods at the top of the statewide nonrenewal averages as of 2022.

On the flip side, the Treasury Department recorded universal renewal activity in a dozen Connecticut locales in 2022, including Cornwall and the Marion section of Southington despite carriers having been hit with high claims activity that year.

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