Source: NAIC data: 2020
One look at this graph shows that the companies with direct loss and DCC to EP ratio are the most profitable, but what exactly is direct loss and DCC to EP ratio? DCC stands for “Defense and Cost Containment” and EP for “Earned Premium”. So the direct loss and the DCC taken together refer to how much a freight forwarder spent on average on claims, while the EP refers to how much profit was made after an expired part of a policy. A lower value is better because this value indicates what part of the EP was spent on claims. For example, Assurant Inc. has a ratio of 51.72. That means it spent 51.72% of its XP on direct losses and DCCs.
So which of the 25 largest insurers in the US is the most profitable (at least according to this metric)? The answer is Assurant with its direct loss and a DCC to EP ratio of 51.72. Assurant was founded in 1892 and has seen many changes over the past 129 years. Global expansion began in 1995, and in 2004 the airline was listed on the New York Stock Exchange under the symbol AIZ. The current CEO is Alan Colberg, who graduated from Harvard Business School in 1987 and has been with the company since 2011. The insurer is obviously benefiting from its position at the top of the table – with EBITDA of $ 600 million for the first half of 2021 alone.
In second place with a rate of 55.30 is Allstate, which was founded in 1931 as part of the Sears Empire and split off from its parent company in 1993. Since then, Allstate has grown into a major player, insuring around 16 million households. The current CEO is Thomas J. Wilson, who graduated from the University of Michigan and later earned an MBA from Northwestern University. He has been with Allstate since 1995 and became CEO in 2007.