All Peril severity reached an all-time high in 2025, rising 25.9% from a year earlier, a new report shows.

LexisNexis Risk Solutions released its 2026 U.S. Home Trends Report, which looks at loss cost, claims frequency and severity.

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All Peril loss cost fell 4.4% and frequency decreased 23.8% from 2024 to 2025, the report shows. The report’s authors say it shows that insurers face rising severity, rising inflation-driven replacement costs and a reshaping loss patterns from shifting climate-driven catastrophes.

Severity reached its highest level in seven years, increasing 93.2% from 2019, offsetting lower claim frequency, the report shows.

It calls fire and lightning “the defining perils of 2025,” with loss cost increasing 76.8%, frequency increasing 6% and severity rising 67.3% from 2024. The increase was driven largely by the January 2025 Los Angeles wildfires, according to the report.

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“Although loss cost across all perils decreased in 2025, it was still the third most expensive year for loss cost for the U.S. home insurance industry within the last seven years,” the report states. “Loss cost was 50.0% higher than in 2019 and continued its upward seven-year trend. Frequency decreased again, continuing the general downward trend since the beginning of the COVID-19 pandemic in 2020.”

While California experienced the highest loss cost due to wildfires, it shows that Nebraska had the highest loss cost for claims across all perils for the last seven years.

Catastrophe claims fell to 51% in 2025, down from 2024. It helped that no hurricanes struck the continental U.S. during the 2025 Atlantic hurricane season. However, the central tornado outbreak in mid-March was the second costliest of the billion-dollar, according to the report.

Topics Trends Claims