WSJ What’s News - Soaring Insurance Rates Have States Considering Price Caps

Episode Date: October 20, 2025

P.M. Edition for Oct. 20. The cost of home and auto insurance in the U.S. has risen so dramatically that lawmakers in some states are considering price controls. But, as WSJ reporter Jean Eaglesham tells us, that approach may have downsides. Plus, millions of internet users struggled to use major websites and apps today as an Amazon Web Services outage persisted for hours. And Apple closed at a record high following news of strong iPhone sales. Alex Ossola hosts. Sign up for the WSJ's free What's News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

This advertisement is brought to you by TALIS. TALUS's industry-leading platforms protect critical applications, data, and identities. Anywhere at scale with the highest ROI, that's why the most trusted companies in the world rely on TALIS to protect what matters most. Learn more at TALISGrup.com slash cyber. We're down for millions of people as the Amazon Web Services outage continues. Plus, big price increases for home and auto insurance have some states considering price caps. That's a balanced regulator say they're trying to draw, which is very difficult. So protecting policyholders without leaving to a California-style exodus of insurers.

And a report of strong iPhone sales sent Apple stock to a new high. It's Monday, October 20th. I'm Alex Oscella for the Wall Street Journal. This is the PM edition of What's News, the top headlines and business stories that move the world today. Amazon was working to fully restore service more than 12 hours after a wide-ranging internet outage began. Millions of websites and platforms rely on Amazon web services for cloud computing, and problems with its network affect the wider internet. Disruptions were reported for a range of companies. from Facebook and Snapchat to financial services companies, including Fidelity and Venmo,

to United Airlines, to Amazon's own shopping site. The Wall Street Journal was one of several media organizations feeling the impact today, and for me personally, my attempt to book some holiday travel did not work. The outage began around 3 a.m. Eastern time after an error in a technical update to a widely used database service that knocked the database offline in Amazon's data centers in Northern Virginia. Other AWS services then failed, too. Belle Lynn, who covers AI and enterprise technology for the journal, told us why it's taking so long for Amazon to fix this issue.

There's typically a lot of complexity involved in any cloud infrastructure service, but in this case, it sounds like from what Amazon has told its customers, that there's a lot of different services involved. It's not just its DynamoDB database, but an issue there that caused a bunch of other services to go down. And so when things like that happen, it's not easy for any cloud provider, whether Amazon, Microsoft, or Google, to get all their services back online. And then one other caveat that's important to note is that the data center that was affected here is one of Amazon's oldest. And so what tech insiders sort of know is that there's a lot of legacy and sort of older tech there.

And so those are some of the underlying issues at play here. AWS is the largest cloud computing service provider in the U.S. Outages in cloud services aren't uncommon, but have become more noticeable as more companies. rely on them. America is in a cost crisis when it comes to home and auto insurance. Since 2020, state regulators have allowed companies to raise the cost of insuring a home by an average of 50%. And increases in auto rates aren't far behind.

That's according to SNP global market intelligence. Some states have a controversial answer to those big rate hikes, price controls. Jean Eaglesham covers insurance for the journal. and joins me now with more. Gene, you write that the cost of home and auto insurance premiums have gone up a ton across the U.S. How much are we really talking and why is this happening? What we've seen since the pandemic is rates up to doubling in some states, so far out stripping inflation. And there's a number of factors driven that. One is high inflation in things like repair costs, replacement costs. We've seen the value of homes go up. Also, we've seen a rise in

natural catastrophes. So hailstorms, wildfires, all of that combining is insurers have pushed up premiums very significantly year on year. We're now starting to see a slight easing in auto rates, but overall, I think homeowners and drivers are really feeling the pain of this. So in response, several states are considering putting price controls on those premiums. What do those proposals look like. Insurance has this long, long history of being regulation by state. That exempts it from the federal antitrust laws. And these states take their own approach to whether they think price caps are appropriate or not. Illinois is an interesting example. The governor there this summer backed a form of veto for the regulator so they could reject rate increases. And that

was after a very significant increase by state farm. And he was kind of incensed that he couldn't do anything about that. We're also seeing, for example, Louisiana is interesting. They've introduced a measure that bans so-called excessive rates. And they can be defined as excessive without any actuarial underpinning. So you don't have to show that there's no basis for it. You can just say it seems excessive to me. And they can even demand refunds from the insurers. Are there drawbacks to this approach of putting price controls on premiums? Certainly the insurers industry will say very vehemently there are big drawbacks to this and their poster child is California and California for decades had an effective 6.9% cap on rate rises and that worked for a long

time in a sense that say their home insurance rates are below the national average despite having a lot of pricey real estate and a lot of disasters but it's led to a crisis in the last couple of years, where pretty much all the major home insurers have stopped selling new insurance, and a lot of homeowners are struggling to get a policy at all. And what we've seen is regulators reacting to that by allowing through a series of very steep price increases, double-digit price increases. And their argument is we can't really have affordability unless you have availability, so you have to somehow persuade the insurers to keep selling. And is that happening in other states as well? So some of those states are still allowing through pretty big increases just because they're concerned to keep the insurers healthy in their market.

And that's the balance of regulators say they're trying to draw, which is very difficult. So protecting policyholders without leaving to a California-style exodus of insurers. Wall Street Journal reporter, Gene, thanks so much for being here. My pleasure. In U.S. markets today, Apple closed at a record. record high after a report that sales of this year's iPhone models had started strongly. Shares of the tech giant climbed nearly 4% to more than $262 a share. It topped Microsoft in market cap, becoming number two by that measure.

Invidia remains number one. Counterpoint, a research firm, said that the iPhone 17 phones outsold the iPhone 16 by 14% in the first 10 days they were available in the U.S. and China. Wall Street has been watching sales of the new phones to see if they surpassed previous rollouts. Apple's rise boosted major indexes. The NASDAQ led the gains, adding 1.4%. And the Dow and the S&P 500 both gained more than 1%. Expect a busy week in markets, with nearly one-fifth of the S&P 500 due to report results this week, including Netflix and Tesla. Coming up, a dumpling craze is fueling America's most successful restaurant chain. More on that and more

after the break. As companies seek to close growing gaps in skills and talent, Deloitte U.S. CEO Jason Garzadas believes it's important for organizations to understand their baseline of skills. There's so many organizations that can't ask and answer the fundamental questions about how much computer science or data management skills do I have or AI development skills in a given domain. By performing a skills inventory, leaders can truly understand where their efforts should be focused. Being blind to those gaps is the real miss. Visit Deloitte.com to learn how your enterprise can help successfully cultivate talent. It's been a bit over a month since conservative activist Charlie Kirk was killed.

But some of the effects are only becoming clear now. One interesting data point, sales of Bibles soared in the weeks after Kirk's death. According to BookTracker Circona Book Scan, there were $2.4 million. Bibles sold in the U.S. in September, a 36 percent jump over the same month of 2024. That's the biggest month of Bible sales so far this year, and Bucks a broader trend of weakening print sales in the U.S. The president of HarperCollins Christian publishing said Bible sales have been strong over the last two years, but it seemed that Kirk's death had awakened a lot of people. Harper Collins publishers, like the Wall Street Journal,

is owned by News Corp. Separately, Disney felt an impact after the company temporary rarely took Jimmy Kimmel off the air following his comments related to Kirk's death. According to data from Antenna, a subscription analytics company, an estimated 3 million subscribers canceled Disney Plus in September, and 4.1 million canceled Hulu. Those cancellation numbers were bigger than the average over the last three months for those services and are a sign that customers were upset over Disney's decision to briefly suspend the show. Shares of French luxury company Caring rose more than 4% today after it said it was selling its beauty business to L'Oreal for 4 billion euros, equivalent

to $4.66 billion, confirming a Wall Street Journal report over the weekend. Caring is selling perfume brand House of Creed, which it bought only two years ago. It's also giving L'Oreal the exclusive rights to develop perfumes and cosmetics for caring labels like Gucci and Valenciaga for 50 years. The deal could leave Caring with less debt and better focus on its core luxury brands. Gucci, its largest brand by revenue, has suffered from slowing sales in China, and Carring's share price has dropped by half over the past four years. The Supreme Court said today that it would decide whether drug users have a constitutional right to own a gun. There is a federal law that bans people who use illegal drugs like meth or cocaine from owning a gun, and the Trump administration wants to keep that law in place. It's a rare example of the administration advocating for gun control instead of pushing to expand gun rights.

The law was the basis for one of Hunter Biden's convictions last year. A federal jury in Delaware found him guilty of three felony counts, including possession of a revolver while being an unlawful drug user. He was later pardoned by his father, former President Joe Biden. And President Trump's special envoy Steve Whitkoff and son-in-law Jared Kushner arrived in Israel today to try to keep a fragile ceasefire and peace process for Gaza on track after clashes between Hamas and Israel. Over the weekend, Israel launched strikes against dozens of Hamas targets, saying the militant group had previously killed two of its troops in an attack. Skirmishing continued today. And finally, which restaurant chain do you think has the highest average sales in the U.S.?

I'll give you a hint. It's not Cheesecake Factory or Del Frisco's Double Eagle Steakhouse. It's Taiwanese restaurant chain Dintai Fung, which has just 16 locations in the U.S. Its large restaurants and rapid service are feeding America's craze for dumplings. On TikTok and other social media, it's not hard to find people posting videos with strong feelings about its food. The contrast of the texture of the dumpling skin and the sticky rice is just heaven in your mouth. It's apparently a really popular restaurant because it took three hours for us to get this table. I have the same feelings on the shalma as they did for the shalombal. It was just bland, not very juicy, and underwhelming.

That buzz is translating to real money. According to Market Research Firm Technomic, the company's U.S. restaurants generated an average of $27 million in annual sales last year. That's the highest number among the 1,500 restaurant chains with five or more locations that Technomic tracks. Dintai Fung's Manhattan restaurant in Times Square is the chain's top-selling location in the U.S., and it's growing, announcing its latest location today, a 20,000 square foot space on the ground floor of a luxury, Brooklyn apartment building. The restaurant is expected to open in

27. And that's what's news for this Monday afternoon. Today's show is produced by Pierre Biennamee and Zoe Colkin with supervising producer Tali Arbel. I'm Alex Osloff for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening. boardrooms love buzzwords AI climate resilience but what do they actually mean for CFOs and execs trying to survive the next earnings call that's where the pre-read comes in real experts and real talk subscribe to the pre-read presented by workieva