IRIS Ratios

Question 1

IRIS 1

Answer 1

Gross Premiums Written to Policyholders’ Surplus
(GWP) / (Current Surplus)
unusual > 900%

Question 2

IRIS 2

Answer 2

Net Premiums Written to Policyholders’ Surplus
(NWP) / (Current Surplus)
unusual > 300%

Question 3

IRIS 3

Answer 3

Change in Net Premiums Written
(Current NWP - Prior NWP) / (Prior NWP)
unusual < -33% or > 33%

Question 4

IRIS 4

Answer 4

Surplus Aid to Policyholders’ Surplus
[(Ceding Commissions/Ceded Premium)*(Ceded UEPR for Non-Affiliates)] / (Current Surplus)
unusual > 15%

Question 5

IRIS 5

Answer 5

Two-Year Overall Operating Ratio
(L&LAE Incurred + Policyholder Dividends)/(NEP) + (Other UW Expenses - Other Income)/(NWP) - (Investment Income)/(NEP)
unusual > 100%

Question 6

IRIS 6

Answer 6

Investment Yield
(Net Investment Income) / (Average Cash & Invested Assets)
Average Cash & Invested Assets = 
(CY Cash & Invested Assets
\+ PY Cash & Invested Assets
\+ CY Investment Income Due & Accrued
\+ PY Investment Income Due & Accrued
- CY Borrowed Money
- PY Borrowed Money
- Net Investment Income) / 2
limit at 0.0%
unusual < 2.0% or > 5.5%

Question 7

IRIS 7

Answer 7

Gross Change in Policyholders’ Surplus
(Current Surplus - Prior Surplus) / (Prior Surplus)
unusual < -10% or > 50%

Question 8

IRIS 8

Answer 8

Change in Adjusted Policyholders’ Surplus
(Current Surplus - Prior Surplus - Change in Surplus Notes - Capital Paid-In - Surplus Paid-In) / (Prior Surplus)
unusual < -10% or > 25%

Question 9

IRIS 9

Answer 9

Adjusted Liabilities to Liquid Assets
(Total Liabilities - Deferred Agents’ Balances) / (Bonds + Stocks + Cash & Short-Term Investments + Receivables for Securities + Interest Due & Accrued - Investments in Parents, Subsidiaries, Affiliates)
unusual > 100%

Question 10

IRIS 10

Answer 10

Gross Agents’ Balances to Policyholders’ Surplus
(Gross Agents’ Balances in Collection) / (Current Surplus)
unusual > 40%

Question 11

IRIS 11

Answer 11

One-Year Reserve Development to Policyholders’ Surplus
(One-Year Loss Reserve Development) / (Prior Surplus)
unusual > 20%

Question 12

IRIS 12

Answer 12

Two-Year Reserve Development to Policyholders’ Surplus
(Two-Year Loss Reserve Development) / (Second Prior Surplus)
unusual > 20%

Question 13

IRIS 13

Answer 13

Estimated Current Reserve Deficiency to Policyholders’ Surplus
Prelim Ratio = Avg{(Developed Prior Year Reserves) / (Prior NEP), (Developed Second Prior Year Reserves) / (Second Prior Year NEP)}
Estimated Reserve Deficiency = (Current NEP)*(Prelim Ratio) - Current Reserves
unusual > 25%