Ratios used to evaluate profitability include three returns Return On Equity, Recurring Return On Equity and One-Time Return On Equity. Abbreviation of
Return On Equity is ROE. These ratios are relevant for fundamentally all firms but particularly vital when analyzing insurers and the other financial service companies. Additionally ratios specifically used in
analyzing insurers contain the combined and operating ratios and their components insurers, investment yield, underwriting leverage and investment return. Later we discuss each of these ratios as well as a measure of labor productivity returns and revenue per employee which is an important driver of the
profitability for insurers and other companies for which skilled employees are very important. Other measures that are applicable for evaluating profitability, primarily net asset turnover are discussed in the accounting quality articles.
