The pace of rate growth slowed throughout 2024 as the market softened. Industry rate levels increased 10% year over year, following an unprecedented 15% rise in 2023.
Overall rate growth, however, continued. From January 2022 to the end of 2024, industry rate levels grew by 35% overall. From 2019 through 2021, overall rate levels remained relatively flat. Only a few months into 2025, initial indications are rate levels will return to more normal levels.
Rate increases over the past two years helped U.S. insurers address profitability issues. While the rate increases helped improve loss ratios for many insurers, they had significant impacts on additional market trends.
LexisNexis Risk Solutions notes that in 2025, tariffs may factor into how insurers consider rate. While the market wouldn’t expect the magnitude of activity seen between 2022 through 2024, tariffs, if they stick, could set off a ripple effect of moderate rate increases with implications across the industry.
