Root, Inc. (ROOT)

Key figures

The last twelve months reported, with the latest price and balance sheet.

Revenue, last twelve months

$1.6B

Revenue growth

14.9%

Net income, last twelve months

$61.2M

Earnings per share

$3.54

Operating margin

5.5%

Net margin

3.9%

Return on equity

18.7%

Market value

$885.7M

Price to earnings

14.7x

Cash

$509.6M

Debt

$197.8M

Debt to equity

0.60

Financial statements

Revenue, profit and cash flow by fiscal year, each year linked to its annual report.

By quarter

What the company said with its results

From the second quarter 2026 (Q2 2026) results, filed 5 August 2026.

• Net income and adjusted EBITDA rose. Net income reached $25 million, up 15% year-over-year, and adjusted EBITDA reached $44 million, up 16%. Total revenues were $389.2 million against $382.9 million a year earlier.
• Diluted EPS rose to $1.49. Diluted EPS was $1.49 for the quarter against $1.29 a year earlier, and $3.58 for the six months against $2.36.
• Total revenue rose modestly. Total revenues were $389.2 million for the quarter, against $382.9 million a year earlier, and $782.7 million for six months, against $732.3 million.
• Return on equity near 31%. Management described net income of $25 million as generating approximately 31% annualized return on equity.
• Gross written premium eased 2%. Gross written premium was $340 million, down 2%, and gross earned premium was $368 million, down 1%, both year-over-year.
• Policies in force rose 6%. Policies in force ended the quarter at 484 thousand, up 6% year-over-year.
• Premium per policy declined. Premiums per policy were $1,479 at June 30, 2026, against $1,616 a year earlier.
• Combined ratio improved to 92.1%. Net underwriting margin improved 3.1 points to 7.9%, equivalent to a 92.1% net combined ratio, which management attributed primarily to expense discipline.
• Expense ratio improved 3.0 points. Net expense ratio improved 3.0 points year-over-year to 26.1%.
• Loss and LAE ratio held steady. Net loss and LAE ratio was 66.0%, against 66.1% a year earlier and 62.2% in the first quarter.
• Sales and marketing spend fell. Sales and marketing expense was $25.3 million against $37.1 million a year earlier, while other insurance expense was $58.4 million against $47.9 million.
• Partner and agent share rose. Partnership and independent agent channels were about 51% of new writings, against about 44% in the prior-year period, per management.
• Direct market stayed competitive. Management described the Direct market as remaining challenging, with carriers increasing marketing spend while lowering prices.
• Carvana offer limited to Root states. Carvana Insurance built with Root is offered exclusively, subject to limited exceptions, in the states where Root writes insurance.

Company events

The newest 8-K filings of 60 held.

Every filing

The newest filings with the SEC of 133 held.

Insider trades

Form 4 trades by officers, directors and 10% owners, last 12 months.

Planned insider sales

Form 144 notices, filed when the sell order goes to the broker.

Large holders

Schedule 13D and 13G filings by holders of more than 5% of the voting shares.

Short interest

Shares sold short and not yet bought back, on each FINRA settlement date.

Funds that hold it

From each fund's latest Form 13F.

185 funds held it at 30 Jun 2026: 90 added and 34 trimmed in the quarter. The largest:

Peers

Companies in the same industry.

• Berkshire Hathaway Inc. (BRK.B): revenue $384.7B, market value $1.17T
• Chubb Ltd. (CB): revenue $61.8B, market value $136.0B
• Progressive Corp. (PGR): revenue $91.1B, market value $131.2B
• Travelers Companies, Inc. (TRV): revenue $48.9B, market value $80.7B
• Allstate Corp. (ALL): revenue $70.1B, market value $63.6B
• American International Group, Inc. (AIG): revenue $26.6B, market value $41.9B
• Arch Capital Group Ltd. (ACGL): revenue $19.2B, market value $35.0B
• Hartford Insurance Group, Inc. (HIG): revenue $29.0B, market value $34.8B
• Everest Group, Ltd. (EG): revenue $16.8B, market value $28.8B
• Cincinnati Financial Corp. (CINF): revenue $13.3B, market value $27.5B

What the company does

Root, Inc. is a technology insurance company whose main focus is United States personal auto insurance. The company says car insurance rates should be based primarily on driving behaviors, and it uses telematics and data science to price policies for individual drivers. It is a full-stack carrier: it designs products, distributes them, underwrites them, administers policies and pays claims.

How it makes money

Root's revenue comes from four sources: net premiums earned, net investment income, fee income and other income. Its auto policies run for six months, and premiums are earned over the period in which coverage is provided. Fee income is mostly a flat fee for paying in installments, policy fees that offset part of the cost of underwriting a policy, and late payment fees. Other income mainly comes from selling website and mobile app policy inquiry leads in places where Root has no presence. Investment income comes from cash and fixed maturity securities such as United States Treasury and agency securities, corporate debt, asset-backed securities and municipal securities.

The company has also begun cross-selling renters policies to its auto customers.

How it finds customers

Root reaches customers through two channels. The direct channel covers digital advertising on search engines and select marketplaces, customer referrals, and household-level media such as direct mail and social media. Existing customers who refer someone who completes a test drive are paid for it, and the company describes referral as its lowest cost acquisition channel.

The partnership channel places Root's insurance inside other companies' customer experiences. It includes automotive and financial services partners, with Carvana named as a partner that uses the fully integrated embedded product. It also includes licensed independent agents, who can quote and bind Root policies through the comparative raters they already use. The Root app is available on iOS and Android, which the filing says covers 99% of United States smartphone users.

How it prices risk

For some customers, Root runs a test drive of two to four weeks. Smartphone sensors measure braking, turning, time of day, driver attentiveness and other factors. Other customers can get a bindable quote based on traditional underwriting variables, and Root also uses continuous telematics and third-party telematics. The company matches miles tracked with actual claims to find the driving factors linked to losses. It has chosen not to quote the group it believes to be the riskiest drivers, whom it describes as up to two times more likely to have an accident than its average targeted customer.

Reinsurance and legal structure

Root uses reinsurance, including excess of loss and quota share structures. Excess of loss protects against large individual losses or catastrophes. Quota share provides regulatory surplus relief. The company has reduced its use of external quota share, and it ceded about 4.4% of gross premiums earned in 2025. Its wholly-owned reinsurer, Root Reinsurance Company, Ltd., is based in the Cayman Islands.

The United States insurers are Root Insurance Company and Root Property & Casualty Insurance Company, both domiciled in Ohio, and Root Florida Insurance Company, domiciled in Florida.

Where it operates and how it is regulated

Root is licensed in 50 states and the District of Columbia and operates in 36 of them. It needs regulatory approval before entering new markets. Insurance is regulated mainly at the state level. The Ohio Department of Insurance is the primary regulator for the two Ohio insurers, and the Florida Office of Insurance Regulation oversees Root Florida. The Cayman Islands Monetary Authority supervises Root Re.

California prohibits any use of telematics, and some other states impose requirements that Root has elected not to meet at this time.

Competition and intellectual property

Root competes with large national insurers such as GEICO, Progressive and Allstate, and with insurtech companies, some of which also use telematics. The filing says the established insurers have greater name recognition, higher financial ratings, more capital and more lines of coverage, so they can offer bundles. Root says it competes favorably on many factors and that its behavioral data and machine learning platform will be difficult for incumbents to copy.

At the end of 2025 Root had 13 issued patents, four non-provisional patent applications and six continuation applications pending in the United States. It also holds trademark registrations in select markets in the United States and Canada.

Its people

Root's 1,256 full-time employees are not represented by a labor union or covered by collective bargaining agreements. The company says its people strategy rests on four pillars: Customer Value, Experimentation and Innovation, Disciplined Thinking, and Operational Excellence. Every employee completes annual compliance and ethics training. Employees who sell insurance, and in some states claims adjusters, must hold insurance licenses and meet continuing education requirements.

*From Root's annual report on Form 10-K for the year ended 31 December 2025. [The filing](https://www.sec.gov/Archives/edgar/data/1788882/000178888226000014/root-20251231.htm)*

From the company's 10-K.