The senators seek 10 years of homeowners and personal auto claims data, along with information on claims practices, employee incentives, and AI use
U.S. Senators Elizabeth Warren (D-Mass.) and Josh Hawley (R-Mo.) have asked Boston-based Liberty Mutual and five other major property and casualty insurers for detailed information on a sharp increase in homeowners and auto claims closed without payment, even as these insurers and the broader P&C industry report rising profitability.
The senators cited reports showing that 44% of homeowners claims resolved by several major insurers in 2025 resulted in no payment, up from 36% a decade earlier, while 45% of auto liability and medical claims resolved in 2025 resulted in no payment, up from about 35% in 2016.
Warren, the ranking member of the Senate Banking, Housing and Urban Affairs Committee, and Hawley on October 2 sent letters to executives of Liberty Mutual, State Farm, Allstate, USAA, Farmers and American Family seeking 10 years of claims data and information concerning claims-handling practices and procedures, employee compensation incentives and the use of artificial intelligence and predictive analytics.
In the letter to Liberty Mutual Chairman, President and CEO Timothy Sweeney, the senators also cited the Boston-based insurer’s 2025 net income of $6.79 billion, a 55% year-over-year increase.
Liberty Mutual Letter Seeks 10 Years Of Claims Data
The senators asked Liberty Mutual to provide the annual number and percentage of homeowners and personal auto claims paid and claims closed without payment during the past 10 years.
They requested the data broken down by peril type and by the reason a claim resulted in no payment, including claims that fell below the applicable deductible, were subject to a policy exclusion, were formally denied, were withdrawn by the policyholder, or resulted in no payment for another reason.
The senators also asked Liberty Mutual to identify, for each of the past 10 years, how many claims initially denied or closed without payment were appealed or otherwise disputed by policyholders and how many subsequently resulted in payment or a reversal of the insurer’s original determination.
They additionally requested an explanation of the principal factors contributing to the increase in homeowners and personal auto claims closed without payment and asked Liberty Mutual to quantify the extent to which deductibles, exclusions, withdrawn claims, formal denials, and other factors contributed to the change.
Claims Practices, Employee Incentives And AI Among Questions
The senators asked whether Liberty Mutual has made any material changes since 2015 to its homeowners or personal auto claims-handling policies, procedures or guidelines and, if so, to describe the changes and reasons for implementing them.
They also requested information on compensation, bonus, performance evaluation, or other incentive programs for employees, contractors, adjusters, or managers involved in claims handling that incorporate measures related to claim payments, claim severity, loss ratios, settlement amounts, claims closed without payment, or denial rates.
The senators also asked Liberty Mutual to describe its use of artificial intelligence, predictive analytics or other automated tools in homeowners and personal auto claims processing, including safeguards used to ensure what the senators described as fair and accurate claims determinations.
They also asked whether Liberty Mutual would commit to making annual claims data available to the Senate Banking Committee and the public.
Senators Cite Rising Percentage Of Claims With No Payment
The senators cited a May report from The Wall Street Journal stating that several major homeowners insurers together made no payment on 44% of homeowners claims they resolved in 2025, compared with 36% a decade earlier.
A subsequent Wall Street Journal report cited in the letters found that auto insurers made no payment on 45% of auto liability and medical claims they resolved in 2025, compared with approximately 35% in 2016.
“While claims may be closed without payment for a variety of reasons, the sharp increase in claims resulting in no payment raises questions about changes in insurers’ coverage and claims-handling practices,” Warren and Hawley wrote to Sweeney.
The letter acknowledges that claims can result in no payment for legitimate reasons, including when the amount of a loss falls below the policyholder’s deductible.
Insurers’ Financial Results Cited In Letters
The senators also cited the insurers’ recent financial results in questioning whether changes in claims practices could be contributing to profitability.
Their letters cited 2025 net income of $12.9 billion for State Farm, $10.2 billion for Allstate, $6.79 billion for Liberty Mutual, $3.18 billion for American Family and approximately $1.24 billion for Farmers. The USAA letter states that the company did not disclose its 2025 earnings but reported $3.9 billion in profits for 2024, approximately triple its 2023 result.
The senators also cited industrywide figures that they said showed property and casualty insurers made a record $136 billion in 2025 and recorded their highest underwriting profitability in 20 years.
“However, the record profits of insurance companies raise questions about whether increasingly aggressive claims-handling practices, including tactics to delay payments, are contributing to higher margins,” Warren and Hawley wrote.
Higher Home And Auto Insurance Costs Also Cited
The senators linked their claims inquiry to increases in homeowners and auto insurance costs.
Their letters state that homeowners insurance premiums increased 70% nationally from 2019 through 2025. For a homeowner with $350,000 in rebuilding coverage, the senators said premiums increased approximately 39%, or $760, in 2025.
The letters also state that average full-coverage auto insurance premiums increased 31% from 2023 through 2025, reaching $2,638 annually.
Warren And Hawley Question Claims With No Payment
“The growing share of both homeowners and auto insurance claims resulting in no payment raises serious questions about whether consumers can trust their insurance companies to hold up their end of the bargain when disasters or emergencies occur and affect their most basic essentials: their home and car,” Warren and Hawley wrote.
The senators asked Liberty Mutual and the other insurers to respond to their inquiries by October 16.
