There’s not a fixed federal limit on loss ratio or profit for car insurance like there is for some types of health insurance. But they need to get approval for rate increases from state regulators for every state that they issue policies in, and some states can be extremely hard to get rate increases through, even when insurers are breaking even or losing money in those states. It’s a tragedy of the commons - each state regulator would benefit from keeping premiums low within their state, but in reality any losses need to be subsidized by higher premiums somewhere else.