Insurance Regulatory Information System (IRIS) ratios are initial screening tests of an insurer's operations and performance. Using
Statutory Annual Statement data, twelve ratios are calculated to review if a company's performance is out of line with the rest of the industry. If four of the twelve ratios fall outside of the usual range, additional regulatory scrutiny usually follows. The twelve ratios are:
| Ratio Number |
Ratio |
Unusual Values |
| 1 |
Gross written premium to Policyholder Surplus (PHS) |
Over 900% |
| 2 |
Net Written Premium to PHS |
Over 300% |
| 3 |
Change in Writings |
Change by more than 33% |
| 4 |
Surplus Aid to PHS |
Over 15% |
| 5 |
Two year operating ratio |
Over 100% |
| 6 |
Yield on invested assets |
Under 3% or over 10% |
| 7 |
Change in PHS |
Drop of more than 10% or increase of more than 50% |
| 8 |
Liabilities to Liquid Assets |
Over 105% |
| 9 |
Agent Balances to PHS |
Over 40% |
| 10 |
One-year reserve development to PHS |
Over 20% |
| 11 |
Two-year reserve development to PHS |
Over 20% |
| 12 |
Reserve deficiency to PHS |
Over 25% |