U.S. Tariffs Projected to Raise Insurance Claims Costs by $60 Billion

David Sampson, CEO of the American Property Casualty Insurance Association, has stated that U.S. tariffs will significantly affect the insurance industry, projecting costs for personal auto claims to rise between $30 billion and $60 billion over the next year. Tariffs on materials like steel, lumber, and heavy equipment will increase automotive repair and home rebuilding costs, which will lead to higher insurance rates.
Sampson emphasized that while these tariffs may not result in a direct increase in claims, they introduce complications such as delays and pricing volatility that exacerbate uncertainty in claims severity and reinsurance pricing.
Beyond immediate costs, he expressed concern about the geopolitical implications, noting that tariffs could influence alliances and economic partnerships, complicating U.S. relationships with allies like Canada and Japan.