Home insurers make $8.8M a day by dragging out claims, study says — here's how to fight back for a faster payout

An analysis from the Consumer Federation of America and Weiss Ratings estimates that home insurers collectively generate about $8.8 million in additional investment income for every day claim payments are delayed. A one-week delay could translate to roughly $61.6 million in investment income for the industry.

But for homeowners already dealing with a disaster, every extra day can make an expensive situation even harder to recover from.

Financing a disaster

Home insurers reject the idea that they deliberately drag out claims to make money. But even without intentional delays, getting paid after a major loss can take far longer than many homeowners expect.

Jennifer Taylor, a public adjuster and founder and CEO of Claim Ready, said the timeline can vary widely depending on the size and complexity of the damage.

“A smaller, straightforward homeowners claim can usually be resolved within a few weeks to a few months,” Taylor told Moneywise. “With a large loss, I regularly see the entire claim and recovery process take 18 to 24 months.”

Part of the reason is that filing a claim is really just the first step. A major loss can mean rounds of inspections, paperwork, repairs and approvals before a homeowner sees the process through.

“You have the initial inspections and documentation, but then you also have the rebuild itself. As construction progresses, there can be additional inspections, including local building inspections, before work can move forward,” she said.

That kind of claim is far from unusual. About one in 18 insured U.S. homes file one each year, according to the Insurance Information Institute, with wind and hail causing the largest share of losses, followed by water damage and freezing.

Insurers have also been dealing with heavier claim loads in recent years. U.S. property claims volume jumped 36% in 2024, according to Verisk data, driven in large part by a 113% surge in catastrophe claims.

The cost of waiting

Even if insurers are juggling a growing number of claims, the financial pressure of waiting ultimately falls on homeowners.

That can be especially frustrating given how most homeowners already pay for coverage. The average U.S. homeowner pays about $2,844 a year for a policy with $300,000 in dwelling coverage, according to Insurify, although premiums can vary widely depending on location, coverage limits and insurer.

And when a payout does not arrive quickly, homeowners may have little choice but to cover costs themselves in the meantime. Taylor said some may have to dip into savings or turn to credit cards to pay for repairs, temporary housing and other expenses.

Delays can also make the original damage more expensive. A relatively minor roof leak, for example, can spread into walls, ceilings and insulation if water continues getting in, potentially leading to mold and leaving homeowners on the hook for urgent repairs before their claim is resolved.

“You can lose financial progress you’ve spent years building, and there is also the lost interest or growth on the savings you’ve had to use,” she said.