Insurers cut Florida rates on strong earnings
Florida’s five largest private-passenger auto insurers are reducing rates by an average of 8% this year, state insurance commissioner Mike Yaworsky announced, as strong earnings and declining loss ratios reshape the state’s auto insurance market.
The five carriers - Progressive, Berkshire Hathaway, State Farm, Allstate, and USAA - together account for 78.6% of Florida’s private-passenger auto market, according to BestLink data based on 2024 direct premiums written.
Florida’s Office of Insurance Regulation (OIR) reported that the state recorded the lowest personal auto liability loss ratio in the nation in both 2024 and 2025, reaching 52.5% last year - the lowest in 15 years.
Auto physical damage loss ratios have also dropped sharply, falling from 112% in 2022 to 49.5% in 2025, regulators said. Both the OIR and insurers credited 2023 legislative reforms for reducing legal costs and driving these improvements.
Progressive posted a 25% rise in fourth-quarter net income to $2.95 billion. Full-year 2025 net income climbed to $11.3 billion from $8.5 billion the year prior.
The company cut rates three times in 2025 and issued $1.2 billion in excess personal auto profit credits in Florida – up from $950 million reported earlier, BestWire reported.
President and CEO Tricia Griffith said a new policyholder today would pay 20% less than a year ago. She did not rule out further rate reductions but noted that catastrophic losses in Florida are typically incurred late in the year.
State Farm, the nation’s top personal auto writer, swung to a $4.6 billion underwriting gain last year after posting a $2.7 billion underwriting loss in 2024. The insurer announced a $5 billion dividend distribution among auto policyholders nationwide the same day.
Florida policyholders will receive an average of $173 per insured vehicle from State Farm’s nearly $533 per-policyholder dividend, the OIR said.
State Farm attributed the turnaround to downward-trending auto repair costs and lower collision frequency in 2025. The company enacted an average 10% rate reduction across 40 states, which it expects will lower premiums by $4.6 billion.
Allstate’s fourth-quarter net income applicable to common shareholders doubled to $3.8 billion from $1.9 billion a year earlier. Chair, president, and CEO Tom Wilson praised recent Florida legislative tort reform as “really good work,” adding, “We’d like to see everybody take this on.” Allstate is reducing rates by 7% for more than 171,000 Florida drivers.
At Berkshire Hathaway subsidiary GEICO, Florida’s second-largest auto carrier, annual pretax underwriting earnings fell to $6.82 billion from $7.81 billion in 2024.
USAA, which has not yet released its 2025 earnings, will lower Florida rates by 7% in May, regulators said.
Industry executives have linked rate relief to House Bill 837, the sweeping tort reform legislation Gov. DeSantis signed into law March 24, 2023. The bill shortened the statute of limitations for negligence claims from four to two years, eliminated one-way attorney fees in most insurance suits, and shifted Florida from a pure to a modified comparative negligence standard – barring plaintiffs who are more than 50% at fault from recovering damages.
Progressive CFO John Sauerland said in November 2025 that since HB 837 took effect, the company’s average loss cost for Florida injury claims dropped between 10% and 20%, and the share of personal injury protection claims resulting in lawsuits fell about 60%.
Allstate’s Tom Wilson said at the time that the Florida reforms represent “a golden opportunity for other states,” and called on more states to adopt similar measures. Litigation data support the trend: auto glass repair lawsuits dropped from 24,720 in the second quarter of 2023 to 2,613 in the same period of 2024, according to actuarial firm Milliman. Florida’s ranking for nuclear verdict payouts fell from second to 10th place in 2024 following the law’s enactment.
Average rate hikes across all Florida insurers fell from 21% in 2023 to a projected 0.2% in 2025, Milliman noted.
As of January 2025, Citizens Property Insurance – Florida’s state-backed insurer of last resort — had reduced its policies in force to 395,144, a 50% drop from the prior year and the lowest level in 14 years, according to the governor’s office. Regulators said 17 new insurance companies have entered Florida since the reforms took hold, increasing market competition across both auto and homeowners’ lines.
State Farm said in a February statement that HB 837 “shows what’s possible when thoughtful policymaking and balanced regulatory oversight combine with industry expertise,” describing it as a model for other states facing similar litigation challenges.
