AM Best: US Home Insurers in 2025 Book First Underwriting Profit in Seven Years

U.S. homeowners multiperil insurers reversed a $1.3 billion underwriting loss in 2024 to post an underwriting profit of $16.5 billion in 2025 – the line’s first underwriting gain since 2019, said AM Best.

In fact, seven of eight years from 2017 to 2024 saw homeowners insurers book underwriting losses.

A recent report on the homeowners segment from the industry rating firm said insurers looked to improve in recent years by increasing premiums to more appropriately match risk. AM Best said insurers are “doing a much better job of matching rate to risk.” That, and a relatively calm 2025 hurricane season, helped financial results.

Filings for rate increases slowed in the second half of 2025 – a trend that has continued in 2026, AM Best said.

The segment also benefitted from price softening in the reinsurance market, as well as its use of advancements in data, analytics, and modeling.

“Homeowners insurers have put resources into improving their underwriting, claim handling, loss control, and overall efficiency to produce improved bottom-line results,” said Maurice Thomas, senior financial analyst, AM Best.

The group’s combined ratio in 2025 improved to 84.5 from 90.7 in 2024 and 99.5 in 2023.

Loss-reserve development, which isn’t typically in the scenario for profit, has aided homeowners insurers the last couple of year, explained AM Best. Five insurance groups – USAA, American Family, Liberty Mutual, Chubb, and RenaissanceRe US – accounted for 47% of the $4.1 billion in favorable development in 2025.

AM Best specifically called out Florida reforms in its report. Tort reform in the Sunshine State has reduced fraudulent and frivolous property-related lawsuits. As a result, insurers of the state’s homes reassessed and decided to take reserves down. Since Florida in the second largest insurance market in the country, the release actions has an “outsized impact on national underwriting results,” said AM Best.