In today’s rapidly changing insurance landscape, few voices offer more clarity than Karl Susman. As both a veteran insurance broker and radio host, Susman stands at the crossroads of consumer needs and industry limitations — where risk, regulation, and real-world economics collide.
His insights highlight a growing imbalance: the widening gap between what insurers can sustainably offer and what consumers can realistically afford. As Susman puts it, “This really isn’t politics. This is really just math.” Behind every premium, claim, and underwriting decision lies a formula reacting to rising risks, increasing losses, and tightening regulations. The result is a system under strain — and millions of Americans feeling the pressure.
Below, we break down Susman’s key observations and what they mean for the future of insurance.
Auto Insurance Under Pressure
Auto insurance illustrates the mounting strain across the industry. Susman notes that many insurers are discouraging new business, signaling deep concern about rising risks. Carriers tell agents, “Don’t write, please,” reflecting a cautious approach driven by escalating losses.
Several factors are reshaping the auto insurance market:
- Rising repair costs driven by expensive vehicle technology
- Higher accident rates tied to distracted driving
- Worsening driver behavior leading to more severe claims
- Regulatory constraints that make it challenging for insurers to adjust rates quickly
In states like California, long approval timelines for rate increases leave insurers absorbing higher costs without corresponding revenue — prompting some to tighten underwriting or exit certain markets entirely.
For consumers, this means fewer choices, higher premiums, stricter payment requirements, and reduced availability of coverage. For brokers like Susman, it creates a difficult environment where helping clients secure affordable policies is increasingly complex.
The Growing Homeowners Insurance Crisis
While auto insurance is tightening, homeowners insurance is facing an even deeper crisis. Susman describes a scenario in which homeowners are “lucky to find adequate and affordable coverage” at all. In some cases, only one — or zero — viable quotes are available.
The reasons are stark:
- More frequent natural disasters such as wildfires, hurricanes, and floods
- Higher reconstruction costs driven by inflation and supply chain challenges
- Increased claims severity from weather and catastrophic events
- Insurer withdrawal from high-risk regions
When insurers retreat, competition drops — and prices rise. This affects far more than just the policyholder:
- Home values may decline.
- Mortgage approvals can stall.
- New construction may slow or stop.
- Community resilience weakens.
Insurance availability has become a foundational factor in regional economic health.
Regulation’s Role in Market Stability
With carriers contracting their offerings, states are stepping in. In California, a recent executive order aims to “expand choices and stabilize existing markets.” Measures include improving rate approval processes and strengthening the FAIR Plan.
But the regulatory balancing act is delicate:
- Protect consumers from excessive rate hikes
- Allow insurers to price in line with actual risk
- Ensure availability while preserving affordability
Susman warns that without balance, markets become unstable. If insurers cannot charge sustainable rates, they simply stop offering coverage — leaving consumers with fewer and costlier options.
The Broker’s Middle Ground
As an independent broker, Susman operates between insurers and consumers — a position requiring expertise, transparency, and empathy. Brokers must advocate for clients while navigating insurers’ shrinking appetites for risk.
This makes brokers indispensable in a volatile market. They help consumers:
- Understand complex policy terms
- Compare shrinking options
- Navigate FAIR Plan and surplus-line alternatives
- Spot regulatory and market trends
- Find creative coverage solutions
Susman emphasizes that brokers are problem-solvers in a system where frustrations on both sides are rising.
What True Market Stability Requires
Susman raises a critical question: What does it really mean to stabilize the insurance market?
Real stability demands:
- Accurate, data-driven pricing that reflects modern risks
- Regulatory frameworks that respond quickly to market shifts
- Consumer transparency about what coverage really costs
- Innovative solutions like usage-based coverage and parametric policies
- Collaboration between carriers, regulators, and brokers
Insurance is fundamentally mathematical. When climate risk, repair costs, and inflation rise faster than premiums, the system falters. When regulations lag behind reality, the imbalance widens.
True stability requires recalibrating the entire ecosystem.
A Path Toward a Sustainable Future
Susman’s insights provide both a warning and an opportunity:
The warning:
If current trends continue, more Americans will struggle to find affordable, adequate insurance — or lose access altogether.
The opportunity:
Regulators and insurers can modernize, innovate, and collaborate to create more resilient systems. Consumers can become more informed and engaged.
Emerging solutions offer promise:
- Telematics and usage-based auto insurance
- AI-enhanced underwriting
- Parametric disaster coverage
- Expanded private markets and surplus lines
These tools may help bridge the gap between rising risks and sustainable pricing.
Conclusion
Karl Susman’s observations offer a clear window into today’s turbulent insurance market. At its core, insurance isn’t about politics — it’s about numbers, risk, and responsibility. The industry faces significant challenges, but with the right balance of innovation, regulation, and transparency, stability is achievable.
Whether you’re shopping for homeowners insurance, renewing your auto policy, or shaping policy at the state level, understanding these dynamics is essential. With informed leadership and collaborative problem-solving, the insurance system can regain stability and continue fulfilling its essential purpose: protecting people, property, and peace of mind.
