July 6, 2026 · Industry Trends

Fewer Property Claims Are Being Filed — But the Ones That Are Cost More

New data from Verisk shows U.S. property claim volume fell sharply in early 2026, driven partly by policy language that keeps more losses off insurers' books — while average claim severity edges toward a record high.

U.S. property insurance claims fell 8.9% in the first quarter of 2026 compared with a year earlier, putting total claim volume 13.1% below the five-year average, according to Verisk's Quarterly Property Claims Report released this week. At first glance, that sounds like good news for everyone. But analysts at Verisk say a significant share of the decline has nothing to do with fewer storms — it is being driven by changes in the way policies are written, changes that are quietly shifting more of the financial burden onto property owners.

Why Fewer Claims Are Being Filed

The single biggest structural driver, according to Susan Fleming, Verisk's vice president of business intelligence and insights, is the spread of percentage-based deductibles and actual-cash-value (ACV) loss provisions. 'We're really starting to see increased usage across the board of those ACV-only loss provisions and loss settlement endorsements than we have in the past,' Fleming said, as quoted by Claims Journal.

Under a percentage deductible, the policyholder owes a share of the home's insured value — not a flat dollar amount — before coverage kicks in. Verisk gave this example: a homeowner with a 2% deductible on a $150,000 home owes $3,000 before the insurer pays anything on a $3,000 water claim. The policy effectively covers nothing on smaller losses. Wind and hail deductibles, which carriers have been adding in storm-prone states, are now being applied 'consistently, almost always,' Fleming told Claims Journal — far more frequently than in prior years. The practical result: many policyholders absorb the full cost of a moderate loss and never file.

Severity Is Rising Even as Volume Falls

The cost picture moves in the opposite direction. Verisk projects that Q1 2026 average claim severity could mature to roughly $17,687 per claim — potentially the second-highest annual figure on record, behind only 2025, according to Risk & Insurance. Roof replacement costs jumped 33% and repair costs rose 25% in 2025 versus the prior four-year average, despite the sharp drop in claim filings, a separate Verisk report noted.

Water damage remained the most common cause of loss, accounting for 31.1% of all U.S. property claims in the first quarter, up 6% year over year. Wind-related claims followed at 20.4%. Geographically, Texas led all states in Q1 claim volume, followed by Ohio and California — three states together representing nearly one-quarter of all U.S. property claims, according to Risk & Insurance. Florida posted a 65.7% decline, largely a comparison effect tied to late-reported Hurricane Milton claims that had inflated Q1 2025 figures.

What This Means for Property Owners

The data highlights a shift in how property insurance functions in practice. As carriers have broadened the use of percentage deductibles and ACV endorsements — partly in response to several years of elevated catastrophe losses — policies that look comprehensive on paper may cover fewer routine or moderate losses than they once did. The Verisk findings apply to both residential and commercial property lines.

What this means for you

If your property policy carries a percentage wind or hail deductible — common in Texas, the Midwest, and other storm-active states — it is worth calculating your actual out-of-pocket exposure in dollar terms before the next storm season. A 2% deductible on a building insured for $500,000 means $10,000 comes out of your pocket before coverage applies. Similarly, if your policy settles losses at actual cash value rather than replacement cost, the payout on an older roof or HVAC system could fall well short of what repair or replacement actually costs today, given that material prices have risen sharply in recent years. Reviewing deductible structures and loss-settlement provisions at renewal — and asking whether replacement-cost coverage or a flat deductible might better fit your situation — is worth the conversation. An independent agency can compare options across multiple carriers to find the structure that fits your risk profile.

Sources & further reading

Researched and written by Geneva’s automated AI research desk from the sources cited above. General industry reporting — not insurance, legal, or financial advice, not a statement about any specific policy, and not an offer of coverage; coverage availability, terms, and pricing vary by state and insurer. Geneva Insurance Group is an independent agency licensed in 14 states. For guidance on your own coverage, talk to a licensed advisor.