Large Property Insurers Deny 40% to 70% of Homeowner Claims

PALM BEACH GARDENS, Fla., July 10, 2024 — Weiss Ratings, the nation’s only independent insurance company rating agency, revealed today that 13 of the nation’s large providers of homeowners insurance in the U.S. closed 40% to 70% of their claims last year with no payment whatsoever to policyholders.

Weiss Ratings Founder Martin D. Weiss commented, “Homeowners have an urgent need to know how many claims their insurers deny, but it’s been virtually impossible for them to acquire this information from either the companies or their regulators.”

Large U.S. Providers of Homeowners Insurance That Closed More Than 40% of Policy Claims with No Payment Whatsoever in 2023

Among insurers that received and closed 50,000 or more homeowners and farmowners claims in 2023, Farm Bureau Property & Casualty Insurance Company (domiciled in Iowa) denied 70.5% of claims with no payment; American Bankers Insurance Company (FL) denied 51.2%; and Allstate Indemnity Company (IL) denied 50.5%.

Even some of the very largest providers — each with hundreds of thousands of homeowners claims closed in 2023 — made zero payments on about half of their claims:

Farmers Insurance Exchange (CA) closed 257,189 homeowners claims in 2023 and denied payment on 49.7%.

United Services Automobile Association (TX) closed 550,099 and denied 48.2%.

USAA General Indemnity Company (TX) closed 273,994 claims and denied 48%.

USAA Casualty Insurance Company (TX) closed 428,116 and also denied 48%.

Allstate Vehicle & Property Insurance Company (IL) closed 545,807, denying 47.1%.

And Allstate Insurance (IL) closed 893,407, denying 46.4%.

In total, 13 large providers closed 3.9 million homeowners policies in 2023, denying any payment on 47.5%. 

Meanwhile, including all reporting companies, 8.8 million homeowner claims were closed in 2023, among which 37.4% were denied payment, up from 24.9% in 2004. Weiss concluded: “There’s nothing normal about these high denial rates. They’ve been creeping up steadily for nearly two decades and have now reached alarming levels, especially among some of the biggest providers in disaster-prone states like Florida and California.

“The public can’t even begin to cope with the property insurance crisis until both the industry and their regulators provide full transparency, a change in standard operating procedure that may not be possible without strong ‘Truth in Insurance’ legislation.”

To check the denial rates of the nation’s homeowners insurers, consumers can go here.

About Weiss Ratings: Weiss rates 53,000 institutions and investments, including safety ratings on insurers, banks and credit unions as well as investment ratings on stocks, ETFs, mutual funds and cryptocurrencies. Since its founding in 1971, Weiss Ratings has never accepted any form of payment from rated entities for its ratings. All Weiss ratings are available at https://weissratings.com.

The U.S. Government Accountability Office (GAO) reported that the Weiss ratings of U.S. life and health insurers outperformed those of A.M. Best by 3-to-1 in warning of future financial difficulties, while also greatly outperforming those of Moody's and Standard & Poor's. The New York Times reported that Weiss “was the first to warn of the dangers and say so unambiguously.” Barron's called Weiss Ratings “the leader in identifying vulnerable companies.”