Loss ratios reveal how much of every premium dollar flows back to policyholders as claims. When ratios sit well below 70% year after year, insurers may be collecting more than the underlying risk warrants. Consumers end up paying the price.
Read the report: How to Lower the Insurance Tax by $150 Billion →This site draws on 25 years of NAIC data (2000–2024), spanning every state and five major insurance lines.
Claims paid ÷ premiums earned. A 75% ratio means 75¢ of every premium dollar goes to claims. The remainder covers insurer expenses, profit, and reserves.
A 70–80% loss ratio is generally considered fair. States consistently below 70% may be overcharging policyholders relative to actual risk — particularly when that pattern persists across a decade.
Researchers at the Vanderbilt Policy Accelerator have analyzed these loss ratios and proposed federal and state reforms to address overpriced insurance. Their papers explain what fair loss ratios look like and how regulation can bring premiums in line with actual risk. Read the research →
Insurers file separate rates in each state. Where regulation is weak or markets are concentrated, low loss ratios can persist for years. Sustained underperformance suggests premiums are not calibrated to risk and that regulatory intervention may be warranted.
Explore the data
All loss ratios come directly from the NAIC Market Share Reports for Property/Casualty Groups and Companies by State and Countrywide, published annually, covering report years 2000–2024.
Lines covered: Homeowners Multiple Peril, Total Private Passenger Auto, Workers' Compensation, Total Commercial Multiple Peril, and Other Liability. Years a state reported N/A (typically monopoly state funds) are excluded from its average; states with fewer than three valid years for a line are shown as N/A. The "National Average" line on each chart is the countrywide industry-wide direct loss ratio for that line, taken from each report's summary table.
The 70–80% range is a reference, not a fixed actuarial constant — it reflects loss ratios at which premiums broadly track claims after typical expenses and reserves, and the appropriate level varies by line. Vanderbilt Policy Accelerator research proposes a minimum loss-ratio floor of 80%; persistent results below this range may warrant regulatory attention. See the Vanderbilt Policy Accelerator insurance research.
Data source: National Association of Insurance Commissioners (NAIC).
