Personal and Commercial Lines Rates Continue to Rise in 2025

• By: Will Jones
• July 16, 2025

Personal and commercial lines rates are still on the rise. In the second quarter of 2025, personal lines insurance rates continued their upward trend, according to new data from Novatae Risk Group. Rates rose by an average of 4.6% overall, driven largely by ongoing increases in both homeowners and auto insurance.

Personal auto is projected to remain profitable, with a forecasted net combined ratio of 96, according to the Insurance Information Institute and Milliman.

Homeowners with high-value properties—those with Coverage A values exceeding $1 million—were hit hardest, with rates increasing by an average of 6.7%. In contrast, properties valued under $1 million saw more modest increases, averaging 3.3%.

Auto insurance within the personal lines sector also saw notable movement, climbing 5.7% in the second quarter compared to a 4.3% rise in the first quarter. Rates for personal articles rose 2.7% during the same period.

“For those owning homes in coastal areas, expect homeowners’ rates to go up, not down,” said Richard Kerr, CEO of Novatae Risk Group. “Agents should advise their clients in coastal areas to renew their insurance between January and March, as rates are often much more favorable during those months.”

On the commercial side, overall rates increased 2.8%, a slight dip from the 3% uptick recorded in the first quarter. Commercial auto and excess liability saw some of the highest increases, at 6.7% and 5%, respectively. General liability, commercial property and business owner policies also continued to climb.

“Automobile and umbrella insurance continue to experience moderate increases, but even these lines are down from the first quarter,” Kerr said. “We are also seeing steady improvement in property insurance rates, which is encouraging for insurance buyers.”

As a result of these increases, personal auto is projected to remain profitable, with a forecasted net combined ratio of 96, according to a new report from the Insurance Information Institute and Milliman.

However, general liability continues to face profitability challenges, posting one of the worst first-quarter loss ratios in over 15 years. Meanwhile, homeowners insurance was heavily impacted by the January wildfires in Los Angeles, contributing to the sector’s worst first-quarter performance since 2011.

Will Jones is IA editor-in-chief.