USAA gives $1B in Fla. rate cuts to following legal reforms

USAA is giving nearly $1 billion in rate reductions, member dividends and other benefits to its Florida policyholders, singling out the state’s tort reforms for curbing legal abuses and allowing the company to pass on more savings to its customers.

The Texas-based insurer, which focuses on services to military families and ranks 14th among Florida insurers in total customers, said this week that the state’s civil litigation reforms passed in 2023 have allowed the company to make the changes. These include $660 million in insurance dividends from December 2025 through the first half of this year, plus auto rate reductions amounting to $250 million.

Beginning June 15, the company’s eligible auto policyholders in the state will receive an average dividend amount of $760, with more than a quarter of customers set to get checks of more than $1,000, USAA said in a news release. 

“Florida’s civil litigation and tort reforms have curbed legal system abuse, helping reduce the legal costs that were a significant driver of premium increases, enabling USAA to pass meaningful savings directly to members,” the company reported. “Other states are following suit”

Last year, Georgia and Louisiana passed reforms to curb abusive litigation and help insurers reduce excessive legal costs, according to USAA, and New York is making similar changes.

The company acknowledged that over the past five years, property and casualty insurance rates nationwide have increased due to more natural disasters as well as inflation and abuses in the civil legal system.

“USAA is reversing that trend,” the company reported. “In 2026, about half of USAA policyholders are expected to see reductions in their six-month auto premiums.”

USAA’s decision to provide dividends to policyholders is in sync with broader indications of market stability that the Florida Office of Insurance Regulation (OIR) has been monitoring since the state enacted its legal reforms, the office’s press secretary said.

“The impacts of these reforms are driving healthy competition across both the property and automotive insurance sectors,” Shiloh Elliott told the Florida Record in an email. “On the property side, we have welcomed 21 new insurers into the Florida market. Furthermore, the OIR has received a total of 105 residential filings from 43 different companies requesting a rate decrease, alongside 104 filings from 48 companies requesting a 0% rate change.”

Similar consumer-friendly trends are taking place in the auto market, Elliott said. In March, the top five auto insurers in Florida, including USAA, recorded significant rate decreases, she said, and Progressive recently returned nearly $1 billion to its customers.

“USAA’s dividend is yet another clear indicator that the market is stabilizing and that the benefits of an improved regulatory and competitive environment are being passed directly to Florida consumers,” Elliott said.

Last month, OIR reported that three new property and casualty insurers – Builder Reciprocal Insurance Exchange, Frontline Insurance Reciprocal Exchange and Wingsail Insurance Co. – were set to do business in Florida.

The executive director of a national advocacy organization hailed the move by USAA.

“USAA's announcement today sends a powerful message to governors and legislators across the country: tort reform is an affordability solution that delivers real, tangible cost savings for constituents,” said Lauren Zelt, executive director of Protecting American Consumers Together. “The results are in, and the playbook is clear: when states crack down on legal system abuse, insurance costs come down, markets stabilize, and consumers win.”

Juan C. Andrade, USAA’s president and CEO, indicated that the company wanted to help military families in particular to deal with recent cost-of-living pressures, financial stresses and severe weather.

““From rate reductions to rewards programs and direct returns, our goal is to deliver meaningful, immediate relief while preserving the financial strength our members depend on,” Andrade said in a prepared statement.