Root Inc., the Columbus-based parent company of Root Insurance, posted a net loss of $5.4 million for the third quarter of 2025, a sharp turnaround from the $22.8 million profit it reported in the same period last year. CEO Alex Timm explained the loss was largely due to a $17 million non-cash expense tied to outstanding warrants with Carvana, with $15.5 million of that amount representing a catch-up charge. This expense reflects the company’s progress in meeting certain policy origination milestones, which trigger warrant vesting.
Despite the quarterly loss, Root’s year-to-date net income has climbed to about $35 million, up from $8.8 million a year ago. The company’s combined ratio—a key measure of underwriting profitability—widened to 102.1 in Q3 from 91.1 last year, indicating increased claims or expenses relative to premiums.
Root has been expanding its reach and boosting sales through partnerships and independent agencies. Its independent agency channel tripled new writings during the quarter, even though Root is currently working with only about 10% of the independent agents nationwide. These agents, using Root’s comparison tools, generated roughly half of the new business in Q3. The company is actively adding more agent appointments.
Partnership deals also continued to play a significant role, accounting for 44% of new policy writings. Key partners include Hyundai Capital America, Experian, Caravan Insurance, and Goosehead Insurance. Gross premiums written grew by 17% to $387.2 million during the quarter.
Root has now expanded its footprint to 36 states, adding Washington in Q3, with more state filings underway. The company also rolled out an upgraded version of its usage-based insurance model, which it believes is 10% more accurate and remains a major factor in its pricing strategy.
Overall, while Root faced some accounting-induced losses this quarter, its growth in premiums, partnerships, and agency channels show the company is still pushing forward in the competitive insurance market.