20+ Interesting U.S. Insurance Industry Statistics [2023]: Insurance Facts, Margins and More - Zippia (2024)

Research Summary. Due to economic growth, improved interest rates, and greater investment income, the U.S. Insurance industry has experienced healthy growth within the past few years. Further, this pattern may just continue going forward, according to our research:

• In 2021, the U.S. Insurance industry’s net premiums written totaled $1.4 trillion.

• There are 5,929 insurance companies across the United States.

• The U.S. Insurance industry employs 2.86 million employees.

• The U.S. Insurance industry contributes 3.1% of the country’s total GDP.

For further analysis, we broke down the data in the following ways:
Types of Insurance | Employment | Companies | Pandemic Response | American Insurance Rates | Trends and Projections

General Insurance Industry Statistics

The Insurance industry isn’t just a force to be reckoned with in the U.S. but also globally. Around the world, there are millions of people who rely on insurance for anything from their houses to their cars. With that in mind, here are some general facts about the Insurance industry.

• Global annual insurance premiums exceeded $7 trillion in 2022.

  After experiencing a slight dip in 2019 (down to $5.03 trillion), worldwide gross insurance premiums increased by 40% to over $7 trillion in the past few years.

  

• In the U.S., private health insurance spending accounts for 28% of National Health Expenditure.

  Though private health insurance expenditure decreased by 1.2% in 2020 (to $1.15 trillion), it still accounts for over a quarter of all healthcare spending in the United States.

• The average Insurance industry profit margin is only 3-5%.

  However, this number is highly dependent on the type of insurance, as some can have net profit margins higher than 20%, and others barely get any profit margin at all.

  That’s because insurance companies only make money when they don’t need to insure anything, so insurances that cover riskier things are more likely to have small profit margins.

• There are 5,954 insurance companies across the United States.

  By state, New York has the most, with 577 native companies, followed by Florida (437), Texas (403), Illinois (337), and Wisconsin (334). Meanwhile, the states with the least number of insurance companies are Alaska and Wyoming, which both only have five.

  State	Number of Insurance Companies
  New York	577
  Florida	437
  Texas	403
  Illinois	337
  Wisconsin	334
  Pennsylvania	254
  Ohio	245
  Iowa	220
  Missouri	178
  Minnesota	152
  Indiana	149
  Delaware	146
  California	132
  Michigan	127
  New Jersey	118
  Arizona	117
  Vermont	112
  Louisiana	105
  Nebraska	103
  Connecticut	103
  Utah	94
  Georgia	89
  Massachusetts	81
  North Carolina	81
  Oklahoma	78
  South Carolina	75
  Tennessee	67
  Virginia	66
  Maryland	61
  New Hampshire	58
  Arkansas	56
  Kentucky	56
  Oregon	49
  Kansas	47
  Colorado	46
  Hawaii	46
  Nevada	45
  Mississippi	42
  Alabama	40
  Montana	40
  South Dakota	38
  New Mexico	37
  Washington	35
  North Dakota	30
  West Virginia	29
  Rhode Island	28
  Idaho	17
  Maine	15
  Alaska	5
  Wyoming	5

Insurance Industry Statistics by Types of Insurance

There are different types of insurance out there for almost anything, from making sure your next of kin has some extra cash to having a backup when a tree falls on your house. Of course, various types of insurance all have different profit margins, expenses, and other differences. According to our research:

• Property and casualty insurance companies have the largest net profit margin of any insurance type, at 23.26%.

  That’s considerably larger than any other type of insurance. But why? Well, this type of insurance covers your home’s structure, property, and belongings in the event of vandalism, theft, and other incidents. The fact is that incidents like these have been decreasing, with burglary down 48.5% from 2010.

  Knowing that, it’s easy to see why this type of insurance has been making so much money in recent years. From 2017 to 2018 alone, net income for Property and casualty insurance companies increased from $38.7 billion to $57.9 billion (49.5%).

• Property and casualty premiums account for 48% of all premiums.

  Of the $1.4 trillion in net premiums written in 2021, 52% of them were from life and annuity insurers, while the other 48% came from property and casualty insurers.

• 16% of consumers say they need life insurance but do not have it.

  That translates to roughly 41 million potential customers, and there’s a reason why. On average, up to 33% of families struggle to meet their daily expenses in the first month after the main wage earner of the family passes away.

• 38% of Americans purchase travel insurance.

  The main reason cited for wanting travel insurance is to have protection in the case of trip cancellation. Overall, 88% of those who purchase travel insurance do so for cancellation protection.

U.S. Insurance Industry Statistics by Employment

Many Americans rely on the U.S. insurance industry for their employment, as well as the safety of their property. Overall, when it comes to U.S. insurance industry employment, here are the facts:

• The U.S. Insurance industry employs 2.86 million employees.

  The number of people employed by the U.S. insurance industry has been increasing steadily over time. In 2015, there were 2.54 million employees, meaning that in five years, the number of employees increased by 12.6%.

  

• The U.S. Insurance industry’s unemployment rate is 61% lower than the national unemployment rate.

  As of February 2023, the Insurance industry had an unemployment rate of 1.4%. This is a decrease from 2.5% in 2021, and also significantly lower than the national unemployment rate of 3.6%.

• The average Insurance industry employee is paid $67,421 per year.

  However, an insurance worker’s salary can also vary heavily depending on factors like job category, location, required experience, education, and more. With that in mind, an insurance employee’s salary can actually range anywhere between $22,500 to $143,500.

  

• When the COVID-19 Pandemic started in April of 2020, unemployment in the Insurance industry only rose to 3.9%.

  From February 2020 to April 2020, unemployment in the Insurance industry tripled from 1% to 3.9%. However, this was still far lower than the national unemployment rate, which skyrocketed to 14.7%.

• 64% of insurers are concerned about rising labor costs.

  And this is causing many to be concerned about quality standards and customer experience as well, as 48% believe these essentials will be affected by the scarcity of skills.

• Only 4% of Millennials want to work in the Insurance industry.

  A troubling trend for the industry, as 75% of the global workforce is now Millennials. In fact, experts predict that up to 25% of insurance professionals are expected to retire within the next three years, with no one to replace them.

Insurance Industry Statistics by Insurance Companies

We’ve all heard of them; from Progressive to Allstate, American insurance companies have memorable catchphrases and even more memorable mascots. Of course, they wouldn’t have such convincing commercials if they weren’t successful. Here are the facts:

• The largest insurance company in the world is Berkshire Hathaway, which is worth $714 billion.

  Berkshire Hathaway is a U.S.-based publicly-traded non-health insurance company and makes far more than any other competitor. The other four in the top five largest companies include United Healthcare ($448 billion), Ping An Insurance ($141 billion), CVS ($136 billion), and AIA Group ($123 billion).

• Berkshire Hathaway’s GEICO Corp. spent $2.16 billion on advertising in 2019.

  That’s more than any other insurance company, though there are other major spenders as well. For instance, Progressive spent $1.95 billion, State Farm spent $1.17 billion, and Allstate spent $929.9 million.

  

Insurance Industry Statistics by the Pandemic Response

The COVID-19 Pandemic has affected almost every industry, and the Insurance industry is no exception. Here are some of the most prominent effects felt by the industry:

• 15% of Americans agree they are more likely to purchase life insurance due to the impact of COVID-19.

• Since the start of the Pandemic, the take-up rate for cyber insurance has increased by 78%.

• In 2020, Progressive saw a year-over-year increase in premiums of 30%.

• Auto insurance prices have risen by 5% in 2022.

• Within the next five years, the average insurer will have lowered costs by 25%.

Insurance Industry Statistics by American Insurance Rates

Insurance is a huge industry in the U.S., and the U.S. Insurance industry is the biggest in the world. In fact, many Americans are required to have everything from home insurance to auto insurance; otherwise, they’ll face fees and other punishments. With that in mind, here are the facts about American insurance rates:

• 23% of Americans don’t have a life insurance policy.

  With top reasons for not having one include that they can’t afford it (38%), the cost isn’t worth it (29%), they don’t have a family to support (28%), and they’re too young to think about it (25%).

  

• 9.6% of Americans don’t have any form of health insurance.

  While that means nearly one in ten Americans are likely to avoid the doctor, these numbers were even worse in the past. Before the Affordable Care Act was passed in 2010, a considerable one in six American adults didn’t have health insurance.

• Inadequate health insurance results in 67% of American bankruptcies.

  In 2020, Americans had to spend $388.6 billion out of pocket to cover healthcare costs when insurance wouldn’t. At the same time, private health insurance covered a whopping $1.15 trillion in healthcare costs.

• New Hampshire and Virginia are the other states that allow you to waive car insurance.

  Out of all 50 states, these are the only two that don’t require Americans to purchase auto insurance. That means a majority of Americans are forced to pay an average of $1,655 per year for mandatory auto insurance.

Insurance Industry Statistics Trends and Projections

Over the coming years, the Insurance industry is expected to grow, and prices are expected to increase. According to our research:

• The Insurance industry grew by nearly 13% between 2020-2021.

• Between 2011-2020, the proportion of customers who purchase online insurance grew from 17% to 29%.

• Up to 25% of the Insurance industry will be automated by 2025.

• 40% of CIOs increased their AI spending in 2021.

• The global Insurance industry is expected to experience a CAGR of 8.5% through 2028.

Insurance Industry Statistics FAQ

1. How much is the U.S. insurance industry worth?

   The U.S. Insurance industry is worth $1.4 trillion (in written net premiums). Of that $1.4 trillion, life and annuity insurers accounted for 52%, while property and casualty approximated the remaining 48%.

   Keep in mind that Health insurance is typically regarded as a separate entity, meaning that the $1.4 trillion figure mainly accounts for life, auto, commercial, and home insurance. Therefore, the U.S. Insurance industry is technically worth even more than its recorded value.

2. What are the average health insurance margins?

   The average health insurance margins are as low as 2%-3%. For example, in 2019 the Health Insurance Industry earned $22 billion, and yet, still only had a profit margin of 3%.

   This is due to the risk associated with insurance, combined with the exorbitant costs of healthcare in the U.S. When patients become ill and insurance companies have to pay up, they can lose the majority of their profits.

3. Is the U.S. insurance industry growing?

   Yes, the U.S. Insurance industry is growing. As a whole, the global industry is expected to have a CAGR of 8.5% through 2020, but the numbers are even more pronounced in the U.S. This is especially true for certain types of insurance, for instance:

   • From 2017 to 2018 alone, net income for Property and casualty insurance companies increased from $38.7 billion to $57.9 billion (49.5%).

   • 15% of Americans agree they are more likely to purchase life insurance due to the impact of COVID-19.

   • Since the start of the Pandemic, the take-up rate for cyber insurance has increased by 78%.

   And those are just a few examples, as insurers are predicting enhanced growth and increased prices in years to come.

4. Who is the biggest insurance company in the U.S.?

   The biggest insurance company in the U.S., and the world, is Berkshire Hathaway. This company is worth $714 billion and owns several noteworthy brands; GEICO, Duracell, Dairy Queen, BNSF, Lubrizol, Fruit of the Loom, etc.

   Overall, Berkshire Hathaway is a U.S.-based publicly-traded non-health insurance company and makes far more than any other competitor. The other four in the top five largest companies in the world include United Healthcare ($448 billion), Ping An Insurance ($141 billion), CVS ($136 billion), and AIA Group ($123 billion).

5. How many insurance companies are there in the U.S.?

   There are 5,954 insurance companies across the United States. By state, New York has the most, with 577 native companies, followed by Florida (437), Texas (403), Illinois (337), and Wisconsin (334). Meanwhile, the states with the least number of insurance companies are Alaska and Wyoming, which both only have five.

6. What percentage of the U.S. economy is insurance?

   Finance and Insurance represent 7.4% of U.S. GDP, with Insurance alone accounting for 3.1% of the country’s total GDP. For context, that means the Insurance industry alone is ranked 11th on the list of the largest contributors to the U.S. GDP.

7. What are the main sectors of the insurance industry?

   There are four main sectors of the Insurance industry, all with different types of insurance. These include:

   • Life & Health Insurance: this sector covers life and annuities, and health and disability, two major and common insurance types in the U.S. In general, these insurances are extremely important because they pertain to people’s lives.

     Life insurance provides a death benefit when a family member passes, while health insurance provides coverage for sickness and injury.

   • General Insurance: general insurance includes some of the most popular insurance types, like property and casualty insurance. This insurance type and others in the sector can cover anything from losses from disasters to auto accidents, which allows victims to resume using their properties when these incidents occur.

   • Specialty Insurance: specialty insurance mostly revolves around financial activities and includes insurance types that protect clients and lenders from shady contractors or borrowers.

   • Reinsurance: This sector aims to protect insurers from catastrophic losses, aka, Insurance for insurance companies, like one big circle.

Conclusion

Worth $1.4 trillion, the U.S. Insurance industry is a huge part of the economy. In fact, Insurance alone contributes 3.1% of the U.S. total GDP.

Overall, the U.S. insurance industry has a profitable future. From growing salaries to AI innovation, healthy growth will drive the industry forward. After all, the global insurance industry – from health insurance to property and casualty insurance – is expected to have continued growth in the coming years.

Experts predict the industry will experience a CAGR of 8.5% through 2028.

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