One of Highest Property Claims Severity Recorded in Q3 on Low Volume, Says Verisk

A new report from Verisk has found that property insurance claims volume during the third quarter 2025 was the lowest it has been in the past five years but claims severity during the period was one of the highest in recent history.

According to Verisk’s Q4 2025 Quarterly Property Report, claims were down nearly 30% in North America compared with third quarter 2024, thanks to reduced catastrophe activity. However, catastrophe and non-cat claims each saw much lower numbers this year compared to the last.

The insurance industry recorded just over one million claim assignments in Q3. As of teh end of Q3, the industry has handled about 3.5 million claims from North America, which is the second-lowest in five years. The last quarter of the year tends to account for 20%-25% of annual claim volume.

“2025 is on track to be the lowest volume year in recent history, yet cost management remains critical as severity trends continue upward,” Verisk said in the report.

Initial findings on average claim severity during Q3 2025 find it down 3.3% to $16,755 but, after maturation adjustments, Verisk expects the average claim severity to be between about $17,260 and $18,430.

Since October 2024, the cost of labor and materials at October 2025 was up 3.8% in the U.S. and up 2.7% in Canada. In the 12 months from October 2024 to October 2025, labor costs have risen nearly 4.5% in the U.S. and about 3.8% in Canada. The average quarterly increase in the U.S. has been 1.1%.

Looking at the cost of materials, costs increased about 2.2% from October 2024 to October 2025 in the U.S., said Verisk.

Photo: A tree lays on a house in Dorr, Michigan after a storm on May 16, 2025. (Neil Blake /The Grand Rapids Press via AP)

Topics Claims Property Numbers