LexisNexis Risk Solutions, a provider of data, analytics and technology services to the insurance, financial services, healthcare and public sectors, has released its 2026 U.S. Home Furnishing Trends Report, Overview of recent developments in the U.S. home insurance market.
The report analyzes claims data across a range of property risks, examining changes in loss costs, claim frequency and severity, while also examining seasonal patterns, catastrophe losses and state-by-state trends to support insurers’ underwriting and risk assessment strategies.
Overall claims severity reached its highest level on record in 2025, up 25.9% from the previous year and up 93.2% since 2019, according to LexisNexis Risk Solutions.
While combined loss costs across all risks fell by 4.4% between 2024 and 2025, with claims frequency falling by 23.8%, the company said loss costs remained the third highest recorded in the past seven years and were still 50% above 2019 levels.
The company also highlighted the impact of major weather-related events on the insurance market. The report pointed out that the United States experienced 23 climate disasters in 2025, causing losses of at least US$1 billion, with total losses estimated at US$115 billion. Among them, losses caused by the Los Angeles wildfires were approximately US$61.2 billion, which illustrates that a single catastrophic event can have a significant impact on annual claims performance.
The report ranks fire and lightning as the costliest property risks in 2025. LexisNexis found that loss costs for these claims increased 76.8% year over year, while severity increased 67.3%, largely reflecting the financial impact of the January 2025 Los Angeles wildfires.
“U.S. home insurance companies continue to face increasing pressure and uncertainty as they contend with a ‘perfect storm’ of increasing severity, rising inflation-driven replacement costs, and changing climate-driven catastrophes that are reshaping loss patterns,” said George Hosfield, vice president and general manager, Home Insurance, LexisNexis Risk Solutions.
“This data reinforces the need for insurers to turn to multi-source data sets and analytics to help more accurately assess risk, benchmark performance and adapt to these volatile market conditions.”
The company said that despite the recent decline in claims frequency, the longer-term trend across the market still points to higher claims costs. While overall loss costs declined in 2025, the company reported claims severity was at its highest level in seven years, offsetting continued declines in claims volume since the COVID-19 pandemic.
Looking at individual risks, the report found that the frequency of fire and lightning claims will increase by 6% in 2025. LexisNexis attributes much of this increase to the Palisades and Eaton wildfires, which caused an estimated $61.2 billion in damage, making them the largest climate-related disaster in the United States in 2025 and the costliest wildfire event in U.S. history.
LexisNexis reports significant reductions in all key metrics for wind-related claims. Compared to 2024, wind damage costs are down 50.4%, claim frequency is down 43.9%, and severity is down 12%. The company said these reductions may be related to a lower number of catastrophic wind events this year.
However, it noted that winds continue to pose significant risks, with an outbreak of tornadoes in mid-March causing an estimated $11 billion in damage and ranking as the second-costliest billion-dollar weather event of 2025.
The report also found that hail-related damage costs were down 38.4% from the seven-year peak recorded in 2023, while claims frequency fell 35.4%. The severity of hail-related claims has remained largely unchanged since 2024.
LexisNexis reports that among non-weather-related claims, flood losses fell 6.4% between 2024 and 2025, and claim frequency dropped 7.8%. However, claims severity increased by 2.5%, and the company said inflation and rising labor and material costs resulted in a 63.16% increase in claims severity since 2019.
Liability claims followed a similar pattern, with LexisNexis’ loss costs down 4% and claim frequency down 14.6%. Nonetheless, severity increased by 12.8% year-over-year. The company said the figures may indicate the impact of social inflation, with liability claims rising faster than general inflation due to increased legal and litigation costs.
Horsfield added: “Broader loss trends are important, but they are only a starting point. The real opportunity for carriers is to use these trends to help better understand what to look for at the individual property level. If wildfire risk expands into new areas, carrier insights into a specific home’s fortification and condition can help support more informed assessment decisions.”
“If a state is experiencing significant water loss patterns, understanding the internal risk characteristics of the properties it insures may be key. By connecting national, state and hazard-level trends with more granular property intelligence, insurers can make more informed underwriting, pricing and portfolio decisions.”
