With Republican candidate Donald Trump securing victory in the 2024 presidential election, the White House is set to turn red.
While the weeks leading up to the election saw a closely contested race, ultimately, Trump secured decisive wins in critical swing states like Wisconsin, Georgia, and Pennsylvania. Breaking with traditional patterns - where Democrats typically prevail in smaller urban counties and Republicans dominate larger, less-populated rural areas - Trump made notable inroads in major cities, gaining significant support in metropolitan areas such as Miami, New York, and Chicago.
In the wake of election night, Insurance Business consulted industry experts to gauge the potential impact of Trump’s re-election. From regulatory shifts, to inflation control and tax reforms, these professionals offered insights on how Trump’s policies may reshape the insurance landscape in the coming years.
Bradley Flowers, founder of Portal Insurance, highlighted the potential for Trump’s economic policies to reduce operational and claims-related costs for insurers, while anticipated tax cuts could drive demand for business insurance.
“A Trump administration committed to reducing inflation could significantly impact the insurance industry, as lower inflation would decrease the costs associated with claims and general operations,” shared Flowers.
He added that potential tax cuts aimed at benefiting businesses could foster a climate for increased entrepreneurship, further fuelling demand for business insurance. “If Trump’s economic policies resemble those of 2016, we may also see lower interest rates, which could reshape insurance carriers’ financial strategies and encourage greater risk-taking,” he added.
While some industry leaders are optimistic about potential economic growth under Trump, others remain cautious about the effects of his ‘America First’ agenda. Richard Look, president and chief strategist at insurance marketing firm Vertibrands, emphasized the importance of a globalized insurance market for maintaining stability.
“The insurance industry is a global enterprise. The more international it is, the better it is for insurance carriers, as it allows them to distribute risk across a broad spectrum of industries and geographic areas.”
Look cautioned that Trump’s preference for domestic production could have unintended consequences for the insurance market, particularly in terms of material availability and supply chain dynamics.
“Trump’s push for local manufacturing could drive up insurance rates,” he explained. “When claims are made and materials are needed, US suppliers may charge more than their foreign counterparts.”
Despite these concerns, Look noted that supply chain issues have largely stabilized since the height of the pandemic, which may help offset potential cost increases.
Nathan Riedel, senior vice president of federal government affairs at Big I (Independent Insurance Agents and Brokers of America), outlined how a Trump administration could bring regulatory relief to independent agencies, potentially reducing their operational burdens.
“Judging by his first term in office, a second Trump White House should be relatively good for the insurance industry,” Riedel observed, pointing to Trump’s historically pro-business stance and a likely continuation of lighter regulatory policies than the Biden administration.
“The President-elect has said he would like to make much of the 2017 Tax Cuts and Jobs Act permanent, including the 20% small business deduction for pass-through entities. This is extremely important to independent insurance agencies, 86% of which are structured this way,” he said. This move, according to Riedel, would provide much-needed relief for agencies, fostering a more favorable environment for business growth.
Similarly, Flowers highlighted that lower interest rates under a Trump administration could stimulate innovation and investment within the insurance sector. "As an agency owner and investor in seed-stage insurtechs, I’ve seen a sharp decline in fundraising and investor interest compared to 2017-2020," he shared. "A Trump-led economy could help reverse this trend, encouraging more innovation and growth in the industry."
