IRIS ratios (Insurance Regulatory Information System ratios) are a set of financial ratios that are used to evaluate the financial strength and solvency of insurance companies. These ratios provide insight into various aspects of a company's financial performance such as liquidity, profitability, and efficiency.

The IRIS ratios are classified into four categories: liquidity, activity, profitability, and solvency. Each category has a set of ratios that assess the financial performance of insurance companies.

Liquidity ratios measure an insurance company's ability to pay off short-term obligations. The most common liquidity ratios in the IRIS system are the current ratio and the quick ratio.

Activity ratios evaluate the efficiency of an insurance company's operations. The most commonly used activity ratios are the premium to surplus ratio and the loss ratio.

Profitability ratios assess the profitability of an insurance company. Return on assets (ROA) and return on equity (ROE) are commonly used profitability ratios.

Solvency ratios measure an insurance company's ability to meet its long-term obligations. The most commonly used solvency ratios are the policyholders' surplus ratio and the net premiums written to surplus ratio.

Insurance companies use IRIS ratios to monitor and improve their financial performance. These ratios are used by regulators to evaluate the financial strength and solvency of insurance companies and to ensure compliance with regulatory requirements. IRIS ratios provide valuable information to investors and policyholders who use these ratios to assess the financial health and stability of a company before investing or purchasing insurance policies.