NAIC: Auto physical damage coverage sees highest return in decade in 2024
Private passenger auto physical damage coverage saw its highest return on net worth in a decade in 2024, reaching 20.7%, nearly 50% above the previous 10-year high of 13.8% in 2020, according to the National Association of Insurance Commissioners (NAIC)’s Report on Profitability by Line By State in 2024.
Auto insurance carriers made a 20.7% return on $149.3 billion in net premiums earned in 2024, the report states.
On average, vehicle damage coverage since 2015 has resulted in a 6.3% return on net worth. This factors into 2022, when the return on net worth was -7.8%. It was the only year in which the return was negative.
Private passenger auto physical damage coverage also witnessed a 12.4% underwriting profit in 2024, the data shows. Yet, auto liability had a 1.9% underwriting loss.
The 12.4% underwriting profit for physical damage coverage is the highest percentage recorded for carriers in the past decade. The second-highest year was 2020, when the companies saw 10.8% underwriting profit.
Underwriting profit has been more turbulent from year to year than return on net worth, according to the NAIC data. The report averages the last 10 years’ underwriting profit for physical damage coverage at 1.5%. Insurance companies have seen multiple years of underwriting loss since 2015, with 2022 at a 13.6% loss.
Major auto carriers saw massive net incomes in 2025, including Allstate. In February, Allstate announced it would reduce premiums for 7.8 million auto and homeowners insurance customers after more than doubling its net income in 2025.
State Farm has also started issuing payments to qualifying auto customers as part of its one-time $5 billion cash back dividend, after the company ended 2025 with a net income of $12.9 billion, doubling its profit.
The NAIC report also compares “private passenger auto physical” profitability by state. Carriers in Wyoming had the largest return on net worth at 29.1% in 2024. South Dakota followed with a 28.4% return on net worth. Utah was the third most profitable state with a 26.9% return on net worth.
Wyoming also had the highest underwriting profit at 19.4%, followed by South Dakota at 18.7% and North Dakota at 16.1%.
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