Verisk: North America property claims volume reaches five-year low in Q1 2025

By Mia MacGregor

June 19 - (The Insurer) - Property claims volume in the U.S. and Canada continued to decline in the first quarter of 2025, hitting a five-year low despite notable weather events in several regions, according to a report from Verisk.

The firm's Quarterly Property Report highlighted a continuing downward trend, noting a 15% decrease from 2023 through 2024, followed by a 7% reduction this year.

While overall claims volume decreased, the national average replacement cost value surged by 46% compared to the same time last year.

Verisk attributed this dramatic increase largely to the California wildfires, noting that the Palisades and Eaton fires generated approximately 48,000 claims totalling roughly $10 billion, with an average estimate of $337,000 per claim.

Texas led the country in claims volume for the first quarter of 2025, driven by significant wind and hail events, the report stated. These accounted for 95% of all Q1 cat claims and 72% of all claims in the state.

California ranked second, with non-cat water claims making up 29% of its first-quarter claims, while cat fire, wind and smoke claims from wind-driven wildfires comprised 33%, according to the report.

States in tornado alley, such as Kentucky and Nebraska, experienced a more than 200% increase in wind and hail claims.

Fire-related losses increased by 40% from 2024, primarily due to California wildfires, with the urban nature of these events leading to a 300% increase in smoke claims.

Wind, hail and wind/hail losses constituted 47% of all first-quarter claims, marking a 7% decrease from 2024, primarily due to a 19% decrease in hail claims.

Verisk also noted a significant increase in hurricane claims of more than 400% during the first three months of 2025, attributed to the later-than-normal conclusion of the 2024 hurricane season.

Reconstruction costs rose 5.2% year over year in the U.S., with the Pacific Palisades region experiencing a localised spike of 4.24%, largely in the last two months. This significantly exceeded California’s average increase of 1.67%.

Labour costs continued to outpace material costs, with concrete masons leading all trades in cost increases. However, the report noted that fuel costs provided some relief, increasing only 3.63% in the U.S. and 3.58% in Canada during the quarter.

Verisk also highlighted additional challenges from recent policy changes. New tariffs are affecting key construction materials, while changing immigration policies are affecting an industry that sources 26% of its workforce from immigrant communities.

“Combined with reconstruction demands from recent catastrophes, these factors signal continued cost pressures through 2025,” the report stated.