What’s going on with insurance?

A Property & Casualty Insurance market update for 2025 – by Matt Desmond, Desmond – Integra Insurance

If you’ve noticed your insurance premiums climbing, you’re not alone. Rate increases have been happening nationwide for several years, but they hit some states—like Texas, California, Florida, and Colorado—much harder. In 2024, the national average increase was 15%, but these states saw even steeper hikes due to unique challenges like wildfires in California and Colorado, hurricanes in Florida and Texas, and hailstorms in Texas.

Even within these states, rates can vary widely depending on your location, claims history, and risk factors. For instance, a homeowner in a hail-prone area of Texas may face significantly higher premiums than someone in a less storm-affected region. On top of that, many carriers are leaving these markets due to profitability issues or non-renewing policies, which limits options and drives up costs even more.

The 2025 outlook here in Texas, where we operate, is somewhat more favorable than 2024. However, prices remain high, and market participants are still limited, as many carriers are hesitant to grow their footprint in states where they feel they can’t turn an underwriting profit.

How to Approach Your Personal Insurance

With premiums up and fewer options available, it’s important to take a closer look at your coverage. Here’s where to start:

Review Your Deductibles

• Higher Deductibles Are Becoming Standard: When shopping for a new policy, you may be required to accept a higher deductible, which is increasingly the norm.
• Impact of Deductible Changes on Costs: Evaluate how higher deductibles affect your out-of-pocket costs versus premium savings. For example:
  • Increasing your home deductible from 1% to 2% on a $750,000 home might save you $700 annually.
  • However, this change doubles your potential expense in a claim from $7,500 to $15,000.
• Carrier-Initiated Deductible Adjustments: Your current carrier might increase your deductible at renewal without much notice. Review your renewal documents carefully.
• Grandfathered Deductibles: Ask your advisor whether you’re grandfathered into lower deductibles or favorable terms that may no longer be available for new policies.

Specific Tips for Home Insurance Deductibles

• Peril-Specific Deductibles: Work with your agent to adjust deductibles for specific perils like wind or hail based on your location’s risks.
• High-Value Homes: If you own a high-value home, consider how much risk you can personally absorb versus the potential premium savings.

Specific Tips for Auto Insurance Deductibles

• Comprehensive and Collision: Increase your comprehensive and collision deductibles. This can lower your premium, and avoiding claims for smaller issues (less than $1,000) prevents surcharges at renewal that often outweigh the benefit of filing the claim.

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Other Considerations for Managing Insurance Costs

• Splitting Policies: Bundling home and auto insurance isn’t always the most cost-effective option. Splitting policies between different carriers could provide better coverage or savings.
• Mitigate Risk With Maintenance: Take proactive steps to reduce risks that might lead to non-renewals, such as:
  • Trimming tree limbs back from your roofline.
  • Repairing damaged handrails.
  • Keeping the exterior of your home well-maintained.
• Exploring Provider Options: Determine whether your insurance provider can compare options across multiple carriers or if they only offer products from specific companies.
• Tailoring Coverage: Work with your agent to customize coverage based on your specific risks and financial situation, rather than defaulting to standard policies.

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By staying informed and collaborating with your insurance agent and financial advisor, you can navigate the challenges of the current P&C market. Proper planning ensures you remain adequately protected without sacrificing necessary coverage for the sake of lower premiums.

Matt Desmond / Advisor + Principal Agent
Desmond – Integra Insurance
Call 512.956.4723 / Text 512.967.3008

CAM Disclosure

M & A Consulting Group, LLC, doing business as CAM Investor Solutions is an SEC registered investment adviser. As a fee-only firm, we do not receive commissions nor sell any insurance products. We provide financial planning and investment information that we believe to be useful and accurate. However, there cannot be any guarantees. 

This blog has been provided solely for informational purposes and does not represent investment advice. Nor does it provide an opinion regarding fairness of any transaction. It does not constitute an offer, solicitation or a recommendation to buy or sell any particular security or instrument or to adopt any investment strategy.

Past performance is not a guarantee of future results. Diversification does not eliminate the risk of market loss. Tax planning and investment illustrations are provided for educational purposes and should not be considered tax advice or recommendations. Investors should seek additional advice from their financial advisor or tax professional.