The major players in the private passenger auto insurance business have made markedly different approaches to a fundamentally changing business environment, as evident by their increasingly extraordinary market share and profit shifts, contrary to prior years’ gradual ebbs and flows.
Following pandemic-era disruption and persistent inflationary pressures, the US private passenger auto insurance industry is undergoing a structural realignment. Industry revenues have only partially recovered, and insurers have adopted sharply different strategies towards success. Some have scaled up, others lean on new technology, and a few pull back with deliberate caution. Beneath topline figures lies a volatile mix of supply chain shocks, regulatory upsets, and shifting consumer behavior, such as fewer new drivers and higher repair costs of sensor-laden vehicles.
This report dissects those dynamics through the lens of combined ratios, market share, and profit-adjusted premiums. It reveals how the sector’s largest players – and several sideliners – choose to navigate perhaps the most consequential underwriting environment in a decade.
For the purpose of Insurance Business America’s Data Hub and this analysis, “private passenger auto insurance” refers specifically to coverage for physical damage, no-fault personal injury protection, and other liability, as reported to the National Association of Insurance Commissioners (NAIC). This definition is narrower than the NAIC’s broader “personal auto” category, which includes motorcycles and recreational vehicles, or the commissioner’s full “private passenger auto” designation, which encompasses coverage such as medical payments, specified causes of loss, and other components excluded from this report.
The “major players” are 2024’s top five direct premium writers within our defined scope of private passenger auto insurance: State Farm, Progressive, United Services Automobile Association (USAA), Allstate, and Berkshire Hathaway. Collectively, in 2024, they accounted for 61 percent of the $266.78 billion in direct premiums written in this refined auto insurance scope, or 63 percent of the NAIC’s broader private passenger auto category.
This concentration of market power is a relatively recent phenomenon, driven largely by the reach of direct-to-consumer distribution models, according to Christopher Grimes, North American Head of US Mortgage, Title and Financial Guarantee Insurance at Fitch Ratings. Barriers to entry in auto insurance remain high, owing to complex regulation across levels of the US government, substantial capital requirements for underwriting, difficulty in differentiating from established brands, and the expense of oft-employed labor.
For this report, IBA spoke with seasoned insurance industry analysts Christopher Grimes, Catherine Seifert (Center for Financial Research and Analysis, formerly S&P Global Ratings), Karl Susman (independent broker and notable industry commentator), and Tim Zawacki (S&P Global Market Intelligence). Beyond IB’s Data Hub, this report also leans on the SEC 10-K filings of publicly traded insurers Berkshire Hathaway, Progressive, and Allstate, and on IBIS World market research reports.
Rate hikes drive growth, but fewer cars on the road reshape long-term demand
The auto insurance industry is growing in terms of premium increases, the largest across any line of insurance business. Since 2021, auto insurance premium increases have been fueled by a hardening market cycle, inflationary pressures, and persistent supply chain disruptions.
As of September 2024, automobile insurance revenue in the US stood at $364.9 billion, down from 2019 levels by 0.5 percent, but projected to grow by 1.2 percent through 2029. Since 2019, employment in the sector has risen by 1.9 percent to 269,000, while the number of businesses has increased modestly, by 0.4 percent to 1,399. In 2024, California wrote over one in 10 (12 percent) of auto premiums examined by this report. States with the next largest shares of auto premiums were Florida (9 percent), Texas (6 percent), New York (4 percent), and Georgia (4 percent).
Repairing vehicles has become significantly more expensive, particularly as cars are increasingly outfitted with complex technologies. Between March 2021 and 2025, the cost of motor vehicle maintenance and repair in the US surged by 34 percent, outpacing the 20 percent rise in prices across all urban goods, according to data from the US Bureau of Labor Statistics. The 2022 invasion of Ukraine by Russia sent steel and semiconductor prices soaring, straining auto parts supply chains and pushing costs directly onto consumers, including insurers. More recently, auto industry groups have warned of similar volatility following President Donald Trump’s proposed 25 percent tariffs on imported auto parts, expected to take effect in May 2025. From 2014 to 2024, across the industry, profits declined 0.9 percent to $44.2 billion, and profit margins declined 0.2 percentage points to 12.1 percent.
In response to rising cost pressures, auto insurers saw underwriting results deteriorate, prompting significant adjustments to pricing strategies. “(Auto insurance providers) sought and received approval to raise rates. So, you’ve had several years of back-to-back, in some cases double-digit, rate increases. It culminated in 2024, with underwriting results showing a big improvement as a result of that dynamic over the last five years,” said Catherine Seifert, director of research at the Center for Financial Research and Analysis and a seasoned insurance industry analyst, in an interview with IBA. In January 2025, a key renewal period, auto premium costs experienced a modest pullback, as increased consumer demand made the line more competitive, she added.
Karl Susman, a veteran insurance broker with 30 years of experience and a frequent industry commentator, echoed Seifert’s view that market growth has largely been premium-driven. Underlying exposure, on the other hand, has declined.
“I’ve seen this firsthand, as well as from talking with the carriers: Kids don’t jump and get their driver’s license at age 16 like they used to,” he noted. “The rise of ridesharing apps and a cultural shift toward remote work and leisure have reduced the number of young drivers and led to a measurable dampening of policyholder growth.”
In 2022, auto liability written exposures (essentially the number of insured cars) were just 0.2 percent over the previous year. By contrast, 2020, the height of the COVID-19 pandemic in the US, saw a 2 percent year-over-year rise. Likewise, over the decade from 2012 to 2022, the average annual increase was 1.3 percent, according to the NAIC’s most recent auto insurance database. “That’s the primary trend (auto insurance providers) are seeing for not having as many policies enforced as an industry... People are just not as eager to get vehicles and licenses as they had been in the past,” said Susman.
Considering significant auto insurance rate increases in the context of rising costs and less frequent policies, underwriting criteria have become the number one differentiator among the major auto insurers.
“Some companies have become far more cautious in certain market segments, especially when it comes to customers deemed more likely to generate losses or claims,” said Tim Zawacki, principal research analyst for insurance at S&P Global Market Intelligence. “There’s a pretty wide dichotomy in how insurers have chosen to manage through this cycle.”
Amid rising costs, major insurers diverge in scale, strategy, and risk appetite
At opposite ends of the spectrum in terms of moving into the market are State Farm and Berkshire Hathaway. The latter, owned by iconic value investor Warren Buffett, operates its auto insurance business exclusively through its subsidiary, GEICO. In 2021, both State Farm and Berkshire Hathaway held comparable shares of the private passenger auto insurance market as defined in this report. Since then, each has moved into markedly different market share positions. This was mapped by deliberate and contrasting strategies, each with its own costs and rewards.
Progressive, by contrast, stands out as a tech-savvy insurer that has apparently driven the balance between continued expansion and profit preservation. “(Progressive’s) corporate culture and goals are unbelievably aggressive. I’ve been told this straight out by home office folks there: they want to be the number one auto insurer in the country. Period,” Susman, a broker Progressive underwrites, told IBA.
Examining the combined ratios of the top auto insurers – their losses and expenses expressed as a percentage of earned premiums – alongside market share trends reveals a nuanced story of industry expansion, revenue growth, and profitability amid a period of considerable upheaval. This report also analyzes profit-adjusted premiums, direct written premiums minus combined ratios, to offer a clearer measure of underlying profit performance.
State Farm hedges scale over short-term profit
State Farm is the US’s largest mutual insurer and led 2024’s direct written premiums for the auto insurance segment examined in this report, with $66.5 billion. For at least the last decade, State Farm has had the greatest market share of examined auto insurance. Recently, between 2021 and 2024, that share surged a remarkable eight percentage points to nearly 24 percent of the examined market. This represents the single largest three-year market share gain among major players dating back at least to 2017.
Zawacki attributes this ascent to State Farm’s scale as the country’s largest overall property and casualty insurer, as well as the advantages conferred by its mutual structure. “They have the ability to be more patient in how they manage through a difficult environment,” he said. “A publicly traded company has to answer to Wall Street on a quarterly basis. That helps explain some of the difference in growth trajectories.”
State Farm’s aggressive market share expansion reflects a strategic prerogative to prioritize growth and capital preservation, unique to its mutual ownership model, said Grimes. Unlike publicly held peers under constant pressure to deliver profits, State Farm has priced its policies with an eye toward capturing market share rather than maximizing short-term profitability, prompting it to grow aggressively even in a turbulent underwriting environment.
As State Farm’s market share climbed, so too did its underwriting losses. In 2017, when State Farm held just 16 percent of the examined auto insurance market, its expenses as a share of premiums (combined ratio) stood at a notably efficient 70 percent of premium earnings. But by 2022, as State Farm’s market share reached a then-record 19 percent, its auto insurance business had slipped into the red, with losses and expenses reaching 111 percent of earned premiums. That year, its profit-adjusted premium fell to –$5.07 billion, the lowest among the top five insurers.
“The fact that they were writing to a combined ratio above 100 percent tends to indicate that they were pricing that product in a way that would not be as cost-effective for one of their public peers,” but nevertheless allowed them to grow, said Grimes. By 2023 and 2024, State Farm’s combined ratio had improved significantly, falling to 100 percent and then to 89 percent, with profit-adjusted premiums rebounding from –$329 million to $7.05 billion. This marked a return to underwriting profitability, even as the company’s market share continued its remarkable upward trajectory.
State Farm’s corporate posture appears to favor endurance over immediate returns. “They’re going to try and keep their rates and market share as best they can, even if it means they’re going to bleed a little bit,” said Susman. He added that State Farm is uniquely positioned to absorb such losses, thanks to the vast volume of business it conducts across multiple insurance lines nationwide. That diversification, he noted, may also help explain the company’s recent return to profitability in auto insurance. For instance, in 2024, State Farm holds commanding auto market share in key states: Texas (34 percent), Georgia (31 percent), New York (28 percent), and California (17 percent).
State Farm’s sheer scale also provides a competitive advantage when leaner insurers raise premiums. “When there has been less overall shopping of policies as a result of all companies moving their rates around. (State Farm) benefit as they’ve taken pretty substantial rate increases along with their peers,” said Grimes.
“You also have to look at (State Farm) competitors as well and their actions that may have made them less competitive in the marketplace,” said Zawacki.
GEICO trims market share to restore margins and reposition for a leaner future
Berkshire Hathaway, operating in the auto insurance space through its subsidiary GEICO, has taken a path starkly opposite to State Farm. The firm has evidently opted for a leaner but more profitable auto insurance business.
“Berkshire Hathaway is a very interesting company,” said Seifert, who views GEICO as a hub of its broader insurance operations. “(GEICO) throws off cash and gives (Berkshire) a lot of investable capital,” she said.
In recent years, however, GEICO has lagged competitors in adopting innovations such as telematics and usage-based insurance. By 2024, it was fifth among the top direct premium writers in the auto insurance category analyzed in this report, with $21.4 billion in written premiums. “A year or so ago, they started to experience a pretty significant deterioration in their underwriting profitability. The decision was made to scale back in areas where Berkshire wasn’t able to make an adequate return,” said Seifert.
“Buffett’s super conservative,” and would prefer a lean but profitable insurance operation, said Susman. “(Buffet) doesn’t have the same way to spread risk like State Farm does... GEICO, it’s just auto insurance.”
Between 2021 and 2023, Berkshire’s share of the auto insurance market analyzed in this report fell by six percentage points, dropping to just 8 percent. That shift saw the company move from holding the second-largest market share among the top five auto insurers to the smallest. This reversal followed years of steady growth; between 2014 and 2021, GEICO’s market share had risen by an average of half a percentage point annually, largely encouraged by the GEICO Gecko’s word of mouth (the firm’s advertising).
In 2024, Berkshire’s largest market presence within the top states was in New York, where it held 18 percent of the examined market share. In other top auto insurance states, Texas, Florida, and Georgia, it ranged from 10 to 5 percen. In California, the auto insurance market’s largest state, Berkshire’s market share doesn’t reach the top 10 providers.
“The (national) pullback in market share for GEICO was intentional. They were willing to lose market share if it meant that underwriting results were going to improve,” Seifert confirmed. “And indeed, they did.”
In the years Berkshire’s market share began to contract, its combined ratio climbed significantly. In 2021, the ratio stood at 80 percent. In 2022, it rose to its highest in the past decade, 91 percent, corresponding to the decade’s lowest profit-adjusted premiums, $2.47 billion.
Then, in 2024, with market share reduced to just 8 percent, Berkshire’s losses and expenses dropped to 70 percent of written premiums. That was the third-lowest combined ratio among major insurers, behind only Progressive and United Services Automobile Association (USAA), and stands in sharp contrast to State Farm’s high market share coupled with elevated cost ratios. Berkshire’s 2024 profit-adjusted premiums reached $6.32 billion, marking a strong recovery from its 2022 performance.
In direct response to elevated losses mentioned in this report’s “Market Overview,” in 2024, GEICO implemented premium rate increases, resulting in a 7.8 percent rise in average written premiums per auto policy and a 7.7 percent increase in total written premiums to $42.9 billion, according to its SEC filings. Policies-in-force declined slightly by 0.5 percent over the year, though growth resumed in the second half, suggesting a recalibration in pricing or customer targeting.
GEICO’s market share erosion over recent years was made possible by a steep reduction in advertising, said Zawacki. At the same time, the company began pivoting to a hybrid direct-to-consumer model, deploying service representatives below the agent level to guide customers toward online policy purchases, which minimized acquisition costs.
At least since 2021, GEICO’s insurance distribution strategy has consistently relied on direct-to-consumer channels like the internet and telephone. The insurer used captive agents to a lesser extent, according to its 2021 and 2024 SEC 10-K filings. In both years, GEICO also operated an affiliated insurance agency that offered third-party products such as homeowners, renters, and life insurance. There was no mention of independent brokers or affinity/white-label distribution models for its core auto insurance business, and neither the 10-K filing provided a quantitative breakdown of premiums or revenue by distribution channel.
On the side of profit growth, Seifert credits much of GEICO’s recent success to CEO Todd Combs, who has led the company since 2019. Earlier in his career, Combs served as a pricing analyst at Progressive, an early adopter of telematics for underwriting. GEICO has only recently begun to leverage similar tools, suggesting that Combs may be steering the company in that direction based on prior experience.
Last September, Ajit Jain, Berkshire’s long-serving insurance chief, sold more than half his Berkshire shares at age 74. This has raised general industry speculation about Jain’s potential retirement and the possibility of a succession plan that would elevate Combs within the broader Berkshire Hathaway structure.
Following Berkshire’s deliberate pullback from the auto insurance market, “My sense is we are likely to see a resumption of growth, subject to what I anticipate will be more price competition in that line,” said Seifert. In 2024, GEICO ramped up advertising spending, according to that year’s 10-K filing, indicating a renewed push for market share.
Technology-led discipline helps Progressive stand out in both profit and share
Progressive has distinguished itself over the past decade by successfully balancing market expansion with disciplined cost management. In 2024, the company wrote $37.8 billion in auto insurance premiums within the scope of this report, second only to State Farm.
With Berkshire Hathaway’s market share falling sharply, in 2024, Progressive rose to become the second-largest player by market share in the examined category, capturing nearly 14 percent. Since 2014, Progressive has posted uninterrupted annual growth of roughly half a percentage point in market share. Its total policies in force rose 18 percent in 2024, according to SEC filings, with direct auto policies alone surging by 25 percent as Progressive leaned heavily into customer acquisition.
What sets the company apart is not only this steady expansion but also the consistency of its underwriting profit. In 2024, Progressive’s combined ratio stood at 68 percent, its second lowest of the past decade, during which it averaged 72 percent. The insurer raised personal auto rates by 3 percent in 2024, a moderation from its 19 percent hike the year prior, according to SEC filings, signaling renewed competitive focus.
That performance translated into a 2024 profit-adjusted premium of $12.11 billion, the top among the major players, up from $8.27 billion in 2023 and $6.66 billion in 2022. Progressive dominates the second-largest auto insurance state, Florida, with 32 percent of the Sunshine State’s market share.
In Q1 2025, “Progressive basically grew their (total) top line almost 20 percent, but they also grew policies enforced by almost 20 percent. Basically, expanding their market share is how they're continuing their robust revenue growth,” said Seifert.
Technology investment has been central to Progressive’s ability to link growth with profit efficiency. “On that front, Progressive is the industry leader,” said Seifert. While initially met with skepticism in the auto insurance space, the company’s early and sustained investment in telematics has paid off, allowing Progressive to achieve exceptional precision in both risk pricing and policy distribution, she said.
“(Progressive) was the first out of the gate with telemetric devices that enabled them to offer usage-based insurance,” said Seifert. The benefits weren’t immediate. The previous age of majority was hesitant to share driving habits and location data with insurers. The current generation, however, is markedly different. “They share everything online. If it means they can save money, they’ll share their driving patterns with their insurance company,” noted Seifert.
“I believe that Progressive has built a competitive moat around the firm because they were so early to adapt this technology and refine it. It’s kind of like a flywheel in motion,” for key indicator performance in risk pricing and consumer engagement, she continued.
In addition to its success in growth and profitability, Progressive benefits from a pair of two-pronged approaches: first, its presence in both preferred and substandard auto insurance markets; and second, a hybrid sales approach that combines direct-to-consumer channels with a broad network of independent agents.
“That’s really the secret sauce for (Progressive),” said Susman. First, while most carriers focus on covering either safe or risky drivers at low premiums with higher premium expenses for the other, Progressive balances its market for both. “State Farm doesn't do that, and GEICO doesn't do that,” said Susman. In 2024, Progressive more than doubled its advertising budget to $4 billion, capitalizing on a more competitive market environment to win share.
Second, the company blends online and phone-based direct-to-consumer sales with agent-driven distribution. Independent brokers like Susman provide customers with personalized advice and the ability to compare offerings across multiple carriers, extending Progressive’s reach without sacrificing flexibility or customer choice.
In 2014, 54 percent of Progressive’s personal auto premiums were written through its agency channel, including independent brokers, affinity groups, and white-label arrangements, according to its SEC 10-K filings. A little less than half, 46 percent, were written through direct channels like online or the phone. Over the following decade, this balance steadily shifted; by 2023, agency share had dropped to 46 percent and direct had risen to 54 percent. The trend shifted into 2024, with agency distribution falling further to 45 percent and direct sales climbing to 55 percent. While the shift has been incremental, it reflects Progressive’s long-term strategic emphasis on digital platforms, user experience enhancements, and increasing consumer preference for direct engagement.
Allstate recalibrates with tech and acquisitions; USAA surges within its niche
Much like Berkshire Hathaway, Allstate saw its examined market share decline in 2024 to 8 percent, its lowest point in the past decade. This, as its combined ratio came down to 80 percent from 2022’s 93 percent, is its highest combined ratio during the past decade, which averaged 80 percent. In 2024, both Allstate and USAA wrote $22 billion in auto insurance premiums within the scope of this report.
Allstate’s auto segment showed notable resilience, achieving an underwriting profit of $1.8 billion in 2024. Its profit-adjusted premiums rebounded to $4.24 billion, a significant recovery from $1.67 billion in 2022. This improvement reflects the effectiveness of the company’s strategic initiatives, like rate adjustments and operational efficiencies, in navigating the challenges of an increasingly competitive and volatile insurance landscape. Allstate's largest state-level market share is in Georgia, with 13 percent, second only to State Farm’s 31 percent.
In 2021, Allstate acquired National General Insurance for $4 billion. This allowed the company to expand into the independent agent market and “made pretty significant changes to its expense structure,” said Grimes.
In 2014, Allstate’s distribution was heavily concentrated in exclusive agents, with over 10,000 agencies serving as the primary interface with customers, according to its SEC filings. By 2023, this number had decreased significantly to 6,400 exclusive agents, as National General’s acquisition contributed to Allstate’s independent agent growing to over 43,000 locations.
In tandem, Allstate has invested heavily in technology. Its subsidiary, Arity, specializes in telematics and data analytics, enabling the company to monitor driving behavior and adjust premiums with a level of precision comparable to Progressive. Using this tech, Allstate implemented localized pricing and tightened underwriting criteria, particularly in geographies with adverse loss ratios, according to its SEC filings. However, Allstate’s innovations have not been without controversy: in January, the state of Texas sued Allstate for allegedly tracking drivers’ behavior via cellphone data without their consent.
Beyond acquisitions, Allstate has been pursuing what it terms a “transformative growth program” aimed at reducing expenses and optimizing acquisition costs, primarily through the distribution changes outlined above. “They’re trying to participate in the same growth trajectory you’ve seen from Progressive and catch up to the top players,” said Grimes.
According to Seifert, Allstate also serves as a case study in business streamlining. The company has exited the annuity and life insurance markets in recent years, allowing it to focus more squarely on core offerings of auto and homeowners insurance.
The insurer reported rising auto claim severity in 2024 due to higher repair costs, an increase in total loss claims, and elevated medical expenses – all key inflationary drivers impacting industry underwriting results.
The USAA operates under a distinctive business model, serving exclusively military members and their families. This focus allows the company to tailor its offerings to the unique needs of that community, including competitive rates and specialized coverage options, such as discounts for vehicle storage during deployments and flexible payment schedules aligned with military pay cycles. In 2024, the company’s examined direct written premiums tied with Allstate at $22.1 billion.
2024 was a standout year for USAA, during which the company more than tripled its total profit to $3.9 billion. Its share of the examined auto insurance market rose to 8 percent. That’s still among the smallest of the major players, but the highest USAA has recorded in at least the past decade.
USAA mirrors State Farm in one key respect: as its market share and direct written premiums increased, so too did its costs. The company’s combined ratio rose from 61 percent in 2021 to 95 percent in 2022, contributing to its first overall profit loss since 1923. By 2024, however, the combined ratio had improved dramatically, falling to 68 percent, while both market share and premiums continued their upward trajectory.
This recovery resulted in 2024’s profit-adjusted premium of $6.9 billion, USAA’s highest in the past decade and a significant rebound from just $807 million in 2022. The performance highlights the strength of USAA’s member-centric, niche-focused model in a highly competitive auto insurance landscape.
Smaller insurers outperform in margins while legacy names struggle to adapt
The profit-adjusted premium trajectories of Farmers, Sentry, American Family, Auto Club Enterprises, and Auto-Owners suggest a quiet but consequential cohort of competitors navigating a market defined by outsized incumbents. These secondary players have, in some cases, outpaced their larger rivals in profit efficiency and growth consistency.
Farmers Insurance Group has consistently shown robust underwriting performance over the past decade. From 2014 to 2024, the group maintained an average annual profit-adjusted premium of $2.46 billion in auto insurance, totaling $27 billion. In 2024, that profit-adjusted premium reached $2.9 billion, reflecting steady growth. Despite the auto industry-wide challenges like rising claims costs and competitive pressures, Farmers’ disciplined underwriting and strategic pricing, as boasted in its financial reports, have contributed to its sustained profitability.
Sentry Insurance Group, meanwhile, has emerged as a notable performer in the auto insurance sector. In 2024, its profit-adjusted premium reached $654 million, or more than double its 2014 to 2024 average of $289 million. This meant a total of $3.18 billion over the decade. Sentry’s strategic partnerships, such as those with Falvey Insurance Group and Aegis General Insurance Agency, have expanded its specialty lines, contributing to its auto insurance growth. Additionally, Sentry's strong capital position, with a policyholder surplus of $8 billion, underscores its financial resilience.
American Family Insurance Group has demonstrated a balanced approach to growth and profitability in auto insurance. Over the decade, it accumulated a total profit-adjusted premium of $11.7 billion. Its 2024 figure, $1.45 billion, surpassed its decade average of $1.06 billion. In 2024, the group reported a total net income of $2.48 billion, a significant turnaround from an $891 million net loss the previous year. This improvement is attributed to strategic rate adjustments and a focus on investment income, despite a slight decline in policy retention and new business.
Auto Club Enterprises Insurance Group has experienced significant growth. It has moved from the 11th to the 9th position among US auto insurers, with premiums increasing from $4.83 billion to $6.47 billion and profit-adjusted premium totaling $10.03 billion over the decade.
Likewise, Auto-Owners Insurance Group’s 2024 profit-adjusted premium was $554 million, nearly triple its long-term average of $199 million in auto insurance. Despite a recent downgrade in its financial strength rating by AM Best, Auto-Owners maintains a strong position with an A+ (Superior) rating. Compared to 2014, Auto-Owner’s profit adjusted premiums underwent a significant climb, dip, and rebound as evident in the chart above. Between 2014 and 2020, the insurers’ profit-adjusted premiums rose from $71.6 million to $576 million. This profit collapsed in 2022 and 2023; its written premiums remained record-high, but were cancelled out by combined ratios of 99 percent and 107 percent. In its annual report, Auto-Owners Group blamed “inflationary pressures and escalated weather-related losses” for an unprofitable 2023. In 2024, the company’s combined ratio returned to 87 percent, allowing the insurer to achieve profit-adjusted premium for examined auto coverage seven times that of 2014.
The underperformance of insurers like Nationwide, Erie, Hartford, and New Jersey Manufacturers (NJM), meanwhile, must be viewed through the lens of a stressed and evolving auto insurance landscape. As outlined above, the sector has been squeezed by compounding inflation, complex repair costs, and volatile supply chains. These forces have challenged even the most robust insurers, but they have been particularly destabilizing for those whose underwriting strategies proved either too slow to adjust or too exposed to external shocks.
In 2024, Nationwide’s profit-adjusted premium declined to $759 million, reflecting a downward trend from 2014’s $1.4 billion. Despite reporting a net operating income of $3.2 billion in 2024, more than doubling from the previous year, the decrease in profit-adjusted premiums suggests challenges in underwriting profitability. This may indicate that while investment income and other factors bolstered overall earnings, core insurance operations faced profitability pressures.
Erie Insurance Group’s 2024 profit-adjustment premium was $104 million, well below its decade’s average of $296 million. Despite this, the company reported a net income of $600.3 million in 2024, up from $446.1 million in 2023. Likewise, with Nationwide, this divergence between net income growth and declining profit-adjusted premiums may point to increased reliance on investment income or other non-underwriting sources for profitability.
Hartford Insurance Group in 2024, meanwhile, reported that its profit-adjusted premium declined to $378 million. It averaged $551 million annually and totaled $6.07 million during the decade. Last year’s decrease aligns with reported catastrophe losses, including $325 million in losses from California wildfires in early 2025.
Finally, NJM accumulated a total profit-adjusted premium of $2.64 billion from 2014 to 2024, with an average of $240 million annually. In 2024, the group’s profit-adjusted premium dropped to just $55 million, indicating a significant downward trend. Additionally, AM Best downgraded NJM’s financial strength rating from A++ to A+ in 2025, citing challenges in underwriting performance. The combination of declining profit-adjusted premiums and a rating downgrade underscores the need for strategic adjustments to enhance profitability.
Strategic contrasts among leaders define the auto insurance industry’s next phase
The post-2021 evolution of the private passenger auto insurance market has dramatically reshaped the industry's competitive architecture, and in doing so, revealed divergent playbooks among its largest actors. State Farm’s remarkable ascent, achieving nearly a quarter of examined the US market share by 2024, reflects the strategic patience of a mutual structure unencumbered by quarterly shareholder expectations. Willing to absorb underwriting losses in the short term, State Farm has priced for scale, expanding during a time of retrenchment and building what may become a commanding long-term position.
Progressive, by contrast, exemplifies a disciplined, data-driven growth model. Its investments in telematics and hybrid distribution have yielded consistent year-over-year gains, with market share rising to 14 percent and a 2024 combined ratio of just 68 percent, among the lowest in the industry. The company’s success suggests a structural advantage rooted in technology and underwriting sophistication rather than capital intensity.
Berkshire Hathaway’s GEICO, once a perennial growth leader, has taken a sharp turn toward profitability over volume. Between 2021 and 2023, the company intentionally ceded market share, shedding six percentage points to fall behind its peers. Yet in 2024, it posted the third lowest combined among major players, 70 percent, suggesting its retrenchment has paid off in underwriting results. GEICO’s trajectory embodies the market’s conservative pivot and highlights CEO Warren Buffett’s long-standing emphasis on underwriting discipline over top-line growth.
Meanwhile, Allstate’s journey reflects a late but deliberate recalibration. Its acquisition of National General, operational streamlining, and embrace of telematics have reoriented the company toward competitive relevance. In 2024, Allstate achieved an underwriting profit of $1.8 billion and a combined ratio of 80 percent, a striking reversal from prior losses. But regulatory challenges, such as legal scrutiny over data practices, may complicate its path forward.
Together, these four insurers illustrate the spectrum of strategies shaping the auto insurance industry’s future. Some pursue volume at the cost of short-term margin; others optimize margin at the expense of share. The balance of power remains in flux, and yet, amid these shifts, smaller players like Sentry and Auto Club Enterprises demonstrate that even in an oligopolistic market, there is room to thrive. So long as pricing, risk, and operational discipline remain in lockstep.
