Q1’25 property claims hit five-year low despite severe weather: Verisk

According to Verisk’s Quarterly Property Report, claims volume continued to decline in the first quarter of 2025, reaching a five-year low despite significant weather events in several regions.

The quarter ended with a total of 1,059,323 claims, comprising 700,394 non-catastrophe (non-CAT) claims—the lowest in five years—and 358,929 catastrophe (CAT) claims.

Overall claim volume dropped about 7% from the same period last year, which had already seen a 15% decline from 2023. Last year’s decrease was largely driven by a 28% drop in catastrophe claims, while this year’s reduction came from a decline in non-CAT claims, with CAT claims remaining steady.

Texas led the country in Q1 claim volume, primarily due to wind and hail events. These accounted for 95% of all CAT claims and 72% of total claims in the state. California ranked second, with non-CAT water claims making up 29% of its total, while CAT fire, wind, and smoke claims—mainly from wind-driven wildfires—represented 33%.

Most of California’s non-CAT water claims stemmed from two winter weather events in early January and early February.

When looking at claims by the type of loss or peril, wind, hail, and wind/hail losses made up 47% of all Q1 claims, a 7% decrease from 2024, largely due to a 19% drop in hail claims. Water accounted for 28.7% of total claims.

Despite the overall drop in claims, the national average replacement cost value surged 46% year-over-year, heavily skewed by California wildfires. The Palisades and Eaton fires alone generated about 48,000 claims, totalling approximately $10 billion, with an average estimate of $337,000 per claim.

Nationwide, reconstruction costs rose 5.2% year-over-year. In California, the average increase was 1.67% (January–April), while the Pacific Palisades region experienced a sharper rise of 4.24%.

Labor costs continue to outpace material costs, and concrete masons continue to experience the highest increases. Fuel prices provided slight relief, rising only 3.63% in the U.S. and 3.58% in Canada for the quarter.

Recent policy changes present additional challenges. New tariffs are affecting key construction materials, while shifting immigration policies impact an industry where 26% of the workforce is from immigrant communities. Coupled with reconstruction demands from recent catastrophes, these factors suggest sustained cost pressures through 2025.

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