FalsePROGRESSIVE CORP/OH/000008066100000806612024-02-142024-02-14

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

 

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) February 14, 2024
THE PROGRESSIVE CORPORATION
(Exact name of registrant as specified in its charter)
Ohio001-0951834-0963169
(State or other jurisdiction of
incorporation)		(Commission File Number)(IRS Employer
Identification No.)
6300 Wilson Mills Road, Mayfield Village, Ohio 44143
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code (440) 461-5000
Not Applicable
(Former name or former address, if changed since last report.)


Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $1.00 Par ValuePGRNew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐


Item 7.01 Regulation FD Disclosure.

On February 14, 2024, The Progressive Corporation (“the Company”) issued a news release containing financial results for the Company and its consolidated subsidiaries for the month ended January 31, 2024. A copy of the news release is attached hereto as Exhibit 99.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

See exhibit index on page 3.
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SIGNATURES


    Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.


Date:February 14, 2024
THE PROGRESSIVE CORPORATION
By:/s/ Mariann Wojtkun Marshall
Name:Mariann Wojtkun Marshall
Title:Vice President and Chief Accounting Officer
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EXHIBIT INDEX


Exhibit No. Under Reg. S-K Item 601Form 8-K Exhibit No.

Description
9999
104104Cover Page Interactive Data File (the cover page tags are
embedded within the Inline XBRL document).

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image0a04a01a67a.jpg
NEWS RELEASE
The Progressive CorporationCompany Contact:
6300 Wilson Mills RoadDouglas S. Constantine
Mayfield Village, Ohio 44143(440) 395-3707

PROGRESSIVE REPORTS JANUARY RESULTS

MAYFIELD VILLAGE, OHIO -- February 14, 2024 -- The Progressive Corporation (NYSE:PGR) today reported the following results for the month ended January 31, 2024:
January
(millions, except per share amounts and ratios; unaudited)2024
Net premiums written$5,495.7 
Net premiums earned$5,386.0 
Net income$700.7 
  Per share available to common shareholders$1.18 
Total pretax net realized gains (losses) on securities$16.6 
Combined ratio – current year87.3
– prior year96.0
Average diluted equivalent common shares587.3

In October 2023, we converted our monthly accounting closing calendar to align with the Gregorian calendar. We do not expect that this change will have a material impact on our reported quarterly and annual underwriting results but it may impact our year-over-year comparisons on monthly results from October 2023 through September 2024. Therefore, during this time period, we have modified and limited the content of the earnings release, compared to our historical reporting. See the Monthly Commentary at the end of the October 2023 release, issued November 17, 2023, for further discussion on the closing calendar conversion.

January 31,
(thousands; unaudited)20242023% Change
Policies in Force
Personal Lines
Agency – auto8,393.37,902.26
Direct – auto11,350.010,430.69
Total personal auto19,743.318,332.88
Total special lines5,984.45,572.97
Total Personal Lines25,727.723,905.78
Total Commercial Lines1,095.81,053.34
Total Property business3,127.92,865.09
Companywide Total29,951.427,824.08
Progressive offers personal and commercial insurance throughout the United States. Our Personal Lines business writes insurance for personal autos and special lines products. Our Commercial Lines business writes auto-related liability and physical damage insurance, business-related general liability and property insurance predominantly for small businesses, and workers’ compensation insurance primarily for the transportation industry. Our Property business writes residential property insurance for homeowners, other property owners, and renters.
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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES
COMPREHENSIVE INCOME STATEMENT
For the month ended January 31, 2024
(millions)
(unaudited)
January
2024
Comments on Monthly Results1
Net premiums written
$5,495.7 
Revenues:
Net premiums earned
$5,386.0 
Investment income
199.5 
Net realized gains (losses) on securities:
Net realized gains (losses) on security sales
(32.1)
Net holding period gains (losses) on securities
48.7 
Total net realized gains (losses) on securities
16.6 
Fees and other revenues
75.8 
Service revenues
25.6 
Total revenues
5,703.5 
Expenses:
Losses and loss adjustment expenses
3,757.5 
Policy acquisition costs
408.6 
Other underwriting expenses
611.2 
Investment expenses
1.5 
Service expenses
29.0 
Interest expense
23.2 
Total expenses
4,831.0 
Income before income taxes
872.5 
Provision for income taxes
171.8 
Net income
700.7 
Other comprehensive income (loss)
Changes in:
Total net unrealized gains (losses) on fixed-maturity securities
112.7 
Net unrealized losses on forecasted transactions
0 
Foreign currency translation adjustment
(0.1)
Other comprehensive income (loss)
112.6 
Total comprehensive income (loss)
$813.3 
1 For a description of our financial reporting and accounting policies as it applies to information contained throughout this release, see Note 1 to our 2022 audited consolidated financial statements included in our 2022 Shareholders’ Report, which can be found at www.progressive.com/annualreport.
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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES
COMPUTATION OF NET INCOME AND COMPREHENSIVE INCOME PER SHARE
&
INVESTMENT RESULTS
For the month ended January 31, 2024
(millions – except per share amounts)
(unaudited)



The following table sets forth the computation of per share results:
January
2024
Net income
$700.7 
Less: Preferred share dividends
5.9 
Net income available to common shareholders
$694.8 
Per common share:
Basic
$1.19 
Diluted
$1.18 
Comprehensive income (loss)
$813.3 
Less: Preferred share dividends
5.9 
Comprehensive income (loss) attributable to common shareholders
$807.4 
Per common share:
Diluted
$1.37 
Average common shares outstanding - Basic
585.3
Net effect of dilutive stock-based compensation
2.0
Total average equivalent common shares - Diluted
587.3


The following table sets forth the investment results for the period:
January
20242023
Fully taxable equivalent (FTE) total return:
Fixed-income securities
0.5%1.8%
Common stocks
1.4%6.4%
     Total portfolio
0.5%2.1%
Pretax annualized investment income book yield
3.6%2.9%


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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION
For the month ended January 31, 2024
($ in millions)
(unaudited)


January
Commercial
Personal Lines BusinessLinesPropertyCompanywide
AgencyDirectTotalBusinessBusinessTotal
Net Premiums Written$1,995.2 $2,526.0 $4,521.2 $767.3 $207.2 $5,495.7 
Net Premiums Earned$1,958.7 $2,327.7 $4,286.4 $860.5 $239.0 $5,386.0 
GAAP Ratios
Loss/LAE ratio67.2 70.669.0 69.8 78.9 69.6 
Expense ratio18.0 15.9 16.9 18.8 29.0 17.7 
Combined ratio85.2 86.5 85.9 88.6 107.9 87.3 
Net catastrophe loss ratio1
0.9 0.3 28.8 2.0 
Actuarial Adjustments2
Reserve Decrease/(Increase)
Prior accident years$(15.5)
Current accident year0 
Calendar year actuarial adjustment$0.4 $1.7 $2.1 $(15.4)$(2.2)$(15.5)
Prior Accident Years Development
Favorable/(Unfavorable)
Actuarial adjustment$(15.5)
All other development92.0 
Total development$76.5 
Calendar year loss/LAE ratio69.6 
Accident year loss/LAE ratio71.0 
1 Represents catastrophe losses incurred during the period, including the impact of reinsurance, as a percent of net premiums earned. During the month, we incurred catastrophe losses related to severe weather throughout the United States.
2 Represents adjustments solely based on our normally scheduled actuarial reviews. For our Property business, the actuarial reserving methodology includes changes to catastrophe losses, while the reviews in our vehicle businesses do not include catastrophes.
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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES
BALANCE SHEET AND OTHER INFORMATION
(millions - except per share amounts and common shares repurchased)
(unaudited)
January 31, 2024
CONDENSED GAAP BALANCE SHEET:
Investments, at fair value:
Available-for-sale securities:
Fixed maturities1 (amortized cost: $64,322.8)
$62,407.4 
Short-term investments (amortized cost: $1,247.6)
1,247.6 
Total available-for-sale securities63,655.0 
Equity securities:
Nonredeemable preferred stocks (cost: $972.5)
912.0 
Common equities (cost: $706.0)
2,956.9 
Total equity securities3,868.9 
Total investments2
67,523.9 
Net premiums receivable11,869.7 
Reinsurance recoverables (including $4,735.9 on unpaid loss and LAE reserves)
5,077.4 
Deferred acquisition costs1,698.0 
Other assets3,926.2 
Total assets$90,095.2 
Unearned premiums$20,226.1 
Loss and loss adjustment expense reserves34,583.6 
Other liabilities2
7,344.4 
Debt6,889.0 
Total liabilities69,043.1 
Shareholders’ equity
21,052.1 
Total liabilities and shareholders’ equity
$90,095.2 
Common shares outstanding585.7 
Common shares repurchased - actual208,942 
Average cost per common share$163.91 
Book value per common share$35.10 
Trailing 12-month return on average common shareholders’ equity
Net income 23.9  %
Comprehensive income28.0 %
Net unrealized pretax gains (losses) on fixed-maturity securities$(1,892.0)
Increase (decrease) from December 2023$142.6 
Debt-to-total capital ratio3
24.7 %
Fixed-income portfolio duration3.1 
Weighted average credit quality
AA- .
1 As of January 31, 2024, we held certain hybrid securities and recognized a change in fair value of $23.4 million as a realized loss during the period we held these securities.
2 At January 31, 2024, we had $391.0 million of net unsettled security transactions classified in “other liabilities.”
3 As previously announced, we are redeeming our Serial Preferred Shares, Series B, on February 22, 2024. Adjusting for the redemption, our debt-to-total capital ratio would have been 25.1%.
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Monthly Commentary
•The Company has no additional commentary regarding January’s results.
Events
Our fourth quarter Investor Relations conference call is currently scheduled to be held on Tuesday, February 27, 2024, at 9:30 a.m. eastern time. This conference call, which will consist of both a conference call and webcast, is scheduled to last 90 minutes and will begin with an approximate 45-minute presentation on our Destination Era strategy, followed by a question and answer session with Tricia Griffith, our CEO, and John Sauerland, our CFO. We plan to post our 2023 Shareholders’ Report online and file our Annual Report on Form 10-K with the SEC on Monday, February 26, 2024. If the dates of our events, which are always subject to change, are rescheduled, we will announce the change in a press release as soon as practical and publish it on our investor website. Details regarding access to the teleconference, or any event changes, will be available at: https://investors.progressive.com/events.
We plan to release February results on Friday, March 15, 2024, before the market opens.
About Progressive
Progressive Insurance® makes it easy to understand, buy and use car insurance, home insurance, and other protection needs. Progressive offers choices so consumers can reach us however it’s most convenient for them — online at progressive.com, by phone at 1-800-PROGRESSIVE, via the Progressive mobile app, or in-person with a local agent.
Progressive provides insurance for personal and commercial autos and trucks, motorcycles, boats, recreational vehicles, and homes; it is the second largest auto insurer in the country, a leading seller of commercial auto, motorcycle, and boat insurance, and one of the top 15 homeowners insurance carriers.
Founded in 1937, Progressive continues its long history of offering shopping tools and services that save customers time and money, like Name Your Price®, Snapshot®, and HomeQuote Explorer®.
The Common Shares of The Progressive Corporation, the Mayfield Village, Ohio-based holding company, trade publicly at NYSE: PGR.
Regulation FD Disclosure Outlets
The Company disseminates information to the public about the Company, its products, services and other matters through various outlets in order to achieve broad, non-exclusionary distribution of information to the public. These outlets include the Company’s website (progressive.com) and its investor relations website (investors.progressive.com). We encourage investors and others to review the information the Company makes public through these outlets, as such information distributed through these outlets may be considered to be material information.
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Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Investors are cautioned that certain statements in this report not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions and uncertainties that could cause actual events and results to differ materially from those discussed herein. These risks and uncertainties include, without limitation, uncertainties related to:

•our ability to underwrite and price risks accurately and to charge adequate rates to policyholders;
•our ability to establish accurate loss reserves;
•the impact of severe weather, other catastrophe events, and climate change;
•the effectiveness of our reinsurance programs and the continued availability of reinsurance and performance by reinsurers;
•the secure and uninterrupted operation of the systems, facilities, and business functions and the operation of various third-party systems that are critical to our business;
•the impacts of a security breach or other attack involving our technology systems or the systems of one or more of our vendors;
•our ability to maintain a recognized and trusted brand and reputation;
•whether we innovate effectively and respond to our competitors’ initiatives;
•whether we effectively manage complexity as we develop and deliver products and customer experiences;
•our ability to attract, develop, and retain talent and maintain appropriate staffing levels;
•the impact of misconduct or fraudulent acts by employees, agents, and third parties to our business and/or exposure to regulatory assessments;
•the highly competitive nature of property-casualty insurance markets;
•whether we adjust claims accurately;
•compliance with complex and changing laws and regulations;
•litigation challenging our business practices, and those of our competitors and other companies;
•the success of our business strategy and efforts to acquire or develop new products or enter into new areas of business and navigate related risks;
•how intellectual property rights affect our competitiveness and our business operations;
•the performance of our fixed-income and equity investment portfolios;
•the impact on our investment returns and strategies from regulations and societal pressures relating to environmental, social, governance and other public policy matters;
•our continued ability to access our cash accounts and/or convert investments into cash on favorable terms;
•the impact if one or more parties with which we enter into significant contracts or transact business fail to perform;
•legal restrictions on our insurance subsidiaries’ ability to pay dividends to The Progressive Corporation;
•limitations on our ability to pay dividends on our common shares under the terms of our outstanding preferred shares;
•our ability to obtain capital when necessary to support our business and potential growth;
•evaluations by credit rating and other rating agencies;
•the variable nature of our common share dividend policy;
•whether our investments in certain tax-advantaged projects generate the anticipated returns;
•the impact from not managing to short-term earnings expectations in light of our goal to maximize the long-term value of the enterprise;
•the impacts of epidemics, pandemics, or other widespread health risks; and
•other matters described from time to time in our releases and publications, and in our periodic reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2022.

Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.

In addition, investors should be aware that accounting principles generally accepted in the United States prescribe when a company may reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when we establish reserves for one or more contingencies. Also, our regular reserve reviews may result in adjustments of varying magnitude as additional information regarding claims activity becomes known. Reported results, therefore, may be volatile in certain accounting periods.
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v3.24.0.1
Cover Page
Feb. 14, 2024
Cover [Abstract]  
Document Type 8-K
Document Period End Date Feb. 14, 2024
Entity Registrant Name PROGRESSIVE CORP/OH/
Entity Incorporation, State or Country Code OH
Entity File Number 001-09518
Entity Tax Identification Number 34-0963169
Entity Address, Address Line One 6300 Wilson Mills Road,
Entity Address, City or Town Mayfield Village,
Entity Address, State or Province OH
Entity Address, Postal Zip Code 44143
City Area Code 440
Local Phone Number 461-5000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, $1.00 Par Value
Trading Symbol PGR
Security Exchange Name NYSE
Entity Emerging Growth Company false
Amendment Flag false
Entity Central Index Key 0000080661
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