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☒
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Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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☐
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Ohio
|
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34-0963169
|
||
(State or other jurisdiction of
incorporation or organization)
|
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(I.R.S. Employer
Identification No.)
|
||
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6300 Wilson Mills Road,
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Mayfield Village,
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Ohio
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44143
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
|
Trading Symbol(s)
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Name of each exchange on which registered
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Common Shares, $1.00 Par Value
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PGR
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New York Stock Exchange
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Large accelerated filer
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☒
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Accelerated filer
|
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
|
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☐
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Emerging growth company
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☐
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•
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Personal auto insurance represented approximately 94% of our total Personal Lines net premiums written in both 2019 and 2018, and 93% in 2017. We ranked third in market share in the U.S. private passenger auto market for 2018, based on premiums written, and we believe we continued to hold that position for 2019. There are approximately 290 competitors in this market. Progressive and the other leading 16 private passenger auto insurers, each of which writes over $2.5 billion of premiums annually, comprise about 80% of this market. All industry data, including ranking and market share, has been obtained directly from data reported by either SNL Financial or A.M. Best Company, Inc. (“A.M. Best”), or was estimated using A.M. Best data as the primary source.
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•
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Special lines products, which include insurance for motorcycles, ATVs, RVs, watercraft, snowmobiles, and similar items, represented the remaining Personal Lines net premiums written for 2019, 2018, and 2017, respectively. Due to the nature of these products, we typically experience higher losses during the warmer weather months. Our competitors are specialty companies and large multi-line insurance carriers. Although industry figures are not available, based on our analysis of this market, we believe that we have been the market share leader for the motorcycle product since 1998 and that we are one of the largest providers of specialty RV and boat insurance.
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•
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The Agency business includes business written by our network of more than 35,000 independent insurance agencies located throughout the United States, including brokerages in New York and California. These independent insurance agents and brokers have the ability to place business with Progressive for specified insurance coverages within prescribed underwriting guidelines, subject to compliance with our mandated procedures. The agents and brokers do not have authority to establish underwriting guidelines, develop rates, settle or adjust claims, or enter into other transactions or commitments. The Agency business also writes insurance through strategic alliance business relationships with other insurance companies, financial institutions, and national agencies. The total net premiums written through the Agency channel represented 49% of our Personal Lines volume in 2019, 50% in 2018, and 51% in 2017.
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•
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The Direct business includes business written directly by us on the Internet, through mobile devices, and over the phone. The total net premiums written by the Direct business represented the remaining Personal Lines volume in 2019, 2018, and 2017, respectively.
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•
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In our Agency channel, we offer customers the opportunity to bundle our auto and property insurance.
|
•
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To further drive bundling in the Agency channel, we offer the Platinum program to those select agents who have the appropriate customers and who believe our bundled offering is a “must have” for their agency. This program combines our auto and home insurance with compensation, coordinated policy periods, single event deductible, and other features that meet the needs and desires that our agents have expressed. We currently have just over 3,700 Platinum agents.
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•
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We offer independent agents an agency quoting system that makes it easier for them to bundle multiple policies with us. Our "Portfolio" quoting system reduces data entry, displays all available products eligible for bundled quotes, simplifies the comparative rater experience, and provides agents and their customers an overview of premium, bundle savings, and applied discounts to allow them to add or remove products with one click. Portfolio is currently available for all agents appointed to write new business in 33 states with plans to roll out to agents countrywide in 2020.
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•
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In the Direct channel, we bundle Progressive auto with Progressive Home products, as well as with homeowners and renters products provided by unaffiliated insurance carriers. We offer these bundles by providing a single destination to which consumers may come for both their auto and property insurance needs. In many cases, we may offer discounts to incentivize or reward this bundling.
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•
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HomeQuote Explorer® (HQX) is our multi-carrier, direct-to-consumers online property offering. Through HQX, consumers are able to quickly and easily quote and compare homeowners insurance online from Progressive and other carriers. During 2019, we expanded the availability of the online buy button for Progressive Home shoppers and are now active in 14 states, with plans to continue to expand over time.
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•
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As we increase our penetration of the more complex, multi-product customers who are critical to our Destination Era success, we are further expanding the roster of products provided by unaffiliated companies that we make available through online and telephonic referrals and for which we receive commission or other compensation that are reported as service revenues. During 2019, we added personal loan financing to our existing list of unaffiliated company products that also include auto financing, home security, home warranty, and life, health, and travel insurance.
|
•
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Our special lines products and umbrella insurance can be combined with any of the auto, home, or renters coverages that we offer, in either the Direct or Agency channel.
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•
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Business auto – autos, vans, pick-up trucks used by small businesses, such as retailing, farming, services, and private trucking, and for-hire livery (non-fleet (i.e., five or fewer vehicles) taxis, black-car services, and airport taxis),
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•
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For-hire transportation – tractors, trailers, and straight trucks primarily used by regional general freight and expeditor-type businesses and non-fleet long-haul operators,
|
•
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Contractor – vans, pick-up trucks, and dump trucks used by small businesses, such as artisans, heavy construction, and landscapers/snowplowers,
|
•
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For-hire specialty – dump trucks, log trucks, and garbage trucks used by dirt, sand and gravel, logging, and coal-type businesses, and
|
•
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Tow – tow trucks and wreckers used in towing services and gas/service station businesses.
|
•
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Commercial Automobile Insurance Procedures/Plans (CAIP) – We are the only servicing carrier on a nationwide basis for CAIP plans, which are state-supervised plans servicing the involuntary market in 43 states and the District of Columbia. As a service provider, we provide policy issuance and claims adjusting services and collect fee revenue. Reimbursements to us from the CAIP plans are required by state laws and regulations, subject to contractual service standards. Any changes in our participation as a CAIP service provider would not materially affect our financial condition, results of operations, or cash flows.
|
•
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Commission-based businesses – We act as an agent for other insurance companies. We offer home, condominium, and renters insurance, among other products, written by unaffiliated insurance companies in the continental United States in the direct channel. We also offer our customers the ability to package their commercial auto coverage with other commercial coverages that are written by unaffiliated insurance companies. We receive commissions for the policies written under this program, all of which are used to offset the expenses associated with maintaining this program.
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•
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Licensing of insurers and agents,
|
•
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Capital and surplus requirements,
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•
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Statutory accounting principles specific to insurance companies and the content of required financial and other reports,
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•
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Requirements for establishing insurance reserves,
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•
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Investments,
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•
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Acquisitions of insurers and transactions between insurers and their affiliates,
|
•
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Limitations on rates of return or profitability,
|
•
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Rating criteria, rate levels, and rate changes,
|
•
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Insolvencies of insurance companies,
|
•
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Assigned risk programs,
|
•
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Authority to exit a business, and
|
•
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Numerous requirements relating to other areas of insurance operations, including: required coverages, policy forms, underwriting standards, and claims handling.
|
•
|
the insurer’s financial statements under statutory accounting principles,
|
•
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details concerning claims reserves held by the insurer,
|
•
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specific investments held by the insurer, and
|
•
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numerous other disclosures about the insurer’s financial condition and operations.
|
•
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Insurance Risks - risks associated with assuming, or indemnifying for, the losses or liabilities incurred by policyholders
|
•
|
Operating Risks - risks stemming from external or internal events or circumstances that directly or indirectly may affect our insurance operations
|
•
|
Market Risks - risks that may cause changes in the value of assets held in our investment portfolios
|
•
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Liquidity Risk - risk that our financial condition will be adversely affected by the inability to meet our short-term cash, collateral, or other financial obligations, and
|
•
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Credit and Other Financial Risks - risks that the other party to a transaction will fail to perform according to the terms of a contract, or that we will be unable to satisfy our obligations when due or obtain capital when necessary.
|
•
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the availability of sufficient, reliable data
|
•
|
our ability to conduct a complete and accurate analysis of available data
|
•
|
uncertainties inherent in estimates and assumptions, generally
|
•
|
our ability to timely recognize changes in trends and to predict both the severity and frequency of future losses with reasonable accuracy
|
•
|
our ability to predict changes in operating expenses with reasonable accuracy
|
•
|
our ability to reflect changes in reinsurance costs in a timely manner
|
•
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the development, selection, and application of appropriate rating formulae or other pricing methodologies
|
•
|
our ability to innovate with new pricing strategies and the success of those strategies
|
•
|
our ability to implement rate changes and obtain any required regulatory approvals on a timely basis
|
•
|
our ability to predict policyholder retention accurately
|
•
|
unanticipated court decisions, legislation, or regulatory actions
|
•
|
the frequency, severity, duration, and geographic location and scope of catastrophe events
|
•
|
our ability to understand the impact of ongoing changes in our claim settlement practices
|
•
|
changing vehicle usage and driving patterns, which may be influenced by oil and gas prices among other factors, changes in residential occupancy patterns, and the emerging sharing economy
|
•
|
advancements in vehicle or home technology or safety features, such as accident and loss prevention technologies or the development of autonomous or partially autonomous vehicles
|
•
|
unexpected changes in the medical sector of the economy, including medical costs and systemic changes resulting from national or state health care laws or regulations
|
•
|
unforeseen disruptive technologies and events,
|
•
|
the ability to understand the risk profile of significant customers, such as transportation network companies, and
|
•
|
unanticipated changes in auto repair costs, auto parts prices, used car prices, or construction requirements or labor and materials costs, or the imposition and impacts of tariffs.
|
•
|
the availability of sufficient, reliable data
|
•
|
the difficulty in predicting the rate and direction of changes in frequency and severity trends, including the effects of future inflation rates, for multiple products in multiple markets
|
•
|
unexpected changes in medical costs, auto repair costs, or the costs of construction labor and materials, and the imposition and impacts of tariffs
|
•
|
unanticipated changes in governing statutes and regulations
|
•
|
new or changing interpretations of insurance policy provisions and coverage-related issues by courts
|
•
|
the effects of changes in our claims settlement practices
|
•
|
our ability to recognize fraudulent or inflated claims
|
•
|
the accuracy of our estimates regarding claims that have been incurred but not recorded as of the date of the financial statements
|
•
|
the accuracy and adequacy of actuarial techniques and databases used in estimating loss reserves, and
|
•
|
the accuracy and timeliness of our estimates of loss and loss adjustment expenses as determined for different categories of claims.
|
•
|
steal, corrupt, or destroy data, including our intellectual property, financial data, or the personal information of our customers or employees
|
•
|
misappropriate funds
|
•
|
disrupt or shut down our systems
|
•
|
deny customers, agents, brokers, or others access to our systems, or
|
•
|
infect our systems with viruses or malware.
|
•
|
Interest rate risk - the risk of adverse changes in the value of fixed-income securities as a result of increases in market interest rates.
|
•
|
Investment credit risk - the risk that the value of certain investments may decrease due to a deterioration in the financial condition, operating performance or business prospects of, or the liquidity available to, one or more issuers of those securities or, in the case of asset-backed securities, due to the deterioration of the loans or other assets that underlie the securities.
|
•
|
Concentration risk - the risk that the portfolio may be too heavily concentrated in the securities of one or more issuers, sectors, or industries, which could result in a significant decrease in the value of the portfolio in the event of a deterioration of the financial condition or performance of, or outlook for, those issuers, sectors, or industries.
|
•
|
Prepayment or extension risk - applicable to certain securities in the portfolio, such as residential mortgage-backed securities and other bonds with call provisions, prepayment risk is the risk that, as interest rates change, the principal of such securities may be repaid earlier than anticipated, requiring that we reinvest the proceeds at less attractive rates. Extension risk is the risk that a security may not be redeemed when anticipated, adversely affecting the value of the security and preventing the reinvestment of the principal at higher market rates.
|
•
|
Liquidity risk - discussed separately below.
|
•
|
insurance regulatory authorities require insurance companies to maintain specified minimum levels of statutory capital and surplus
|
•
|
insurance regulations restrict the amounts available for distribution based on either net income or surplus of the insurance company
|
•
|
competitive pressures require our insurance subsidiaries to maintain high financial strength ratings, and
|
•
|
in certain jurisdictions, prior approval must be obtained from regulatory authorities for the insurance subsidiaries to pay dividends or make other distributions to affiliated entities, including the parent holding company.
|
|
For the years ended December 31,
|
||||||||||||||||||
|
2019
|
|
|
2018
|
|
|
2017
|
|
|
2016
|
|
|
2015
|
|
|||||
Total revenues
|
$
|
39,022.3
|
|
|
$
|
31,979.0
|
|
|
$
|
26,839.0
|
|
|
$
|
23,441.4
|
|
|
$
|
20,853.8
|
|
Net income attributable to Progressive
|
3,970.3
|
|
|
2,615.3
|
|
|
1,592.2
|
|
|
1,031.0
|
|
|
1,267.6
|
|
|||||
Per common share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to Progressive - diluted
|
6.72
|
|
|
4.42
|
|
|
2.72
|
|
|
1.76
|
|
|
2.15
|
|
|||||
Dividends declared per common share
|
2.65
|
|
|
2.5140
|
|
|
1.1247
|
|
|
0.6808
|
|
|
0.8882
|
|
|||||
Comprehensive income attributable to Progressive
|
4,432.9
|
|
|
2,520.1
|
|
|
1,941.0
|
|
|
1,164.0
|
|
|
1,044.9
|
|
|||||
Total assets
|
54,895.3
|
|
|
46,575.0
|
|
|
38,701.2
|
|
|
33,427.5
|
|
|
29,819.3
|
|
|||||
Debt outstanding
|
4,407.1
|
|
|
4,404.9
|
|
|
3,306.3
|
|
|
3,148.2
|
|
|
2,707.9
|
|
|||||
Total shareholders’ equity
|
13,673.2
|
|
|
10,821.8
|
|
|
9,284.8
|
|
|
7,957.1
|
|
|
7,289.4
|
|
|||||
Redeemable noncontrolling interest
|
225.6
|
|
|
214.5
|
|
|
503.7
|
|
|
483.7
|
|
|
464.9
|
|
Name
|
|
Age
|
|
Offices Held and Last Five Years’ Business Experience
|
Susan Patricia Griffith
|
|
55
|
|
President and Chief Executive Officer since July 2016; Vice President from May 2015 to June 2016; Personal Lines Chief Operating Officer from April 2015 to June 2016; President of Customer Operations prior to April 2015
|
John P. Sauerland
|
|
55
|
|
Vice President since May 2015; Chief Financial Officer since April 2015; Personal Lines Group President prior to April 2015
|
John A. Barbagallo
|
|
60
|
|
Commercial Lines President since May 2015; Commercial Lines Group President, including Agency Operations prior to May 2015
|
Jonathan S. Bauer
|
|
42
|
|
Chief Investment Officer since January 2020; Portfolio Manager prior to January 2020
|
Steven A. Broz
|
|
49
|
|
Chief Information Officer since February 2016; Claims Process General Manager from March 2015 to January 2016; Enterprise Project Management Office Leader prior to March 2015
|
Patrick K. Callahan
|
|
49
|
|
Personal Lines President since April 2015; Direct Acquisition Business Leader prior to April 2015
|
M. Jeffrey Charney
|
|
60
|
|
Chief Marketing Officer
|
Mariann Wojtkun Marshall
|
|
57
|
|
Assistant Secretary; Vice President and Chief Accounting Officer since March 2019; Director of Financial Reporting - GAAP prior to March 2019
|
Daniel P. Mascaro
|
|
56
|
|
Vice President, Secretary, and Chief Legal Officer since March 2017; Claims Legal Business Leader prior to March 2017
|
John Murphy
|
|
50
|
|
Customer Relationship Management President since January 2016; Customer Relationship Management Business Leader prior to January 2016
|
Lori Niederst
|
|
46
|
|
Chief Human Resource Officer since November 2016; Senior Human Resource Business Leader prior to November 2016
|
Andrew J. Quigg
|
|
40
|
|
Chief Strategy Officer since July 2018; Customer Experience General Manager from May 2015 to June 2018; Direct Media Business Leader prior to May 2015
|
Michael D. Sieger
|
|
58
|
|
Claims President
|
EQUITY COMPENSATION PLAN INFORMATION
|
|
||||||||
Plan Category
|
|
Number of
Securities to be
Issued upon
Exercise
of Outstanding
Options, Warrants
and Rights
|
|
Weighted-Average
Exercise Price
of Outstanding
Options,
Warrants
and Rights
|
|
Number of Securities
Remaining
Available for
Future Issuance
Under Equity
Compensation Plans
|
|
||
Equity compensation plans approved by security holders:
|
|
|
|
|
|
|
|
||
Employee Plans:
|
|
|
|
|
|
|
|
||
2015 Equity Incentive Plan
|
|
3,536,391
|
|
1,2
|
NA
|
|
9,993,099
|
|
3
|
2010 Equity Incentive Plan
|
|
342,686
|
|
1
|
NA
|
|
97,929
|
|
4
|
Subtotal Employee Plans
|
|
3,879,077
|
|
|
NA
|
|
10,091,028
|
|
|
Director Plans:
|
|
|
|
|
|
|
|
||
2017 Directors Equity Incentive Plan
|
|
38,451
|
|
|
NA
|
|
366,559
|
|
|
Equity compensation plans not approved by security holders:
|
|
|
|
|
|
|
|
||
None
|
|
|
|
|
|
|
|
||
Total
|
|
3,917,528
|
|
|
NA
|
|
10,457,587
|
|
|
•
|
Report of Independent Registered Public Accounting Firm
|
•
|
Consolidated Statements of Comprehensive Income - For the Years Ended December 31, 2019, 2018, and 2017
|
•
|
Consolidated Balance Sheets - December 31, 2019 and 2018
|
•
|
Consolidated Statements of Changes in Shareholders’ Equity - For the Years Ended December 31, 2019, 2018, and 2017
|
•
|
Consolidated Statements of Cash Flows - For the Years Ended December 31, 2019, 2018, and 2017
|
•
|
Notes to Consolidated Financial Statements
|
•
|
Supplemental Information (Unaudited)
|
•
|
Schedule I - Summary of Investments - Other than Investments in Related Parties
|
•
|
Schedule II - Condensed Financial Information of Registrant
|
•
|
Schedule III - Supplementary Insurance Information
|
•
|
Schedule IV - Reinsurance
|
•
|
Report of Independent Registered Public Accounting Firm on Financial Statement Schedules
|
•
|
No other schedules are required to be filed herewith pursuant to Article 7 of Regulation S-X.
|
|
December 31, 2019
|
||||||||||
Type of Investment
|
Cost
|
|
Fair Value
|
|
Amount At
Which Shown
In The
Balance Sheet
|
||||||
Fixed maturities:
|
|
|
|
|
|
||||||
Bonds:
|
|
|
|
|
|
||||||
United States Government and government agencies and authorities
|
$
|
13,100.7
|
|
|
$
|
13,251.1
|
|
|
$
|
13,251.1
|
|
States, municipalities, and political subdivisions
|
1,686.0
|
|
|
1,713.3
|
|
|
1,713.3
|
|
|||
Public utilities
|
303.8
|
|
|
314.1
|
|
|
314.1
|
|
|||
Corporate and other debt securities
|
6,556.5
|
|
|
6,753.6
|
|
|
6,753.6
|
|
|||
Asset-backed securities
|
10,810.4
|
|
|
10,883.2
|
|
|
10,883.2
|
|
|||
Redeemable preferred stocks
|
185.7
|
|
|
195.0
|
|
|
195.0
|
|
|||
Total fixed maturities
|
32,643.1
|
|
|
33,110.3
|
|
|
33,110.3
|
|
|||
Equity securities:
|
|
|
|
|
|
||||||
Common stocks:
|
|
|
|
|
|
||||||
Public utilities
|
81.6
|
|
|
172.7
|
|
|
172.7
|
|
|||
Banks, trusts, and insurance companies
|
220.9
|
|
|
664.9
|
|
|
664.9
|
|
|||
Industrial, miscellaneous, and all other
|
823.0
|
|
|
2,468.7
|
|
|
2,468.7
|
|
|||
Nonredeemable preferred stocks
|
971.3
|
|
|
1,038.9
|
|
|
1,038.9
|
|
|||
Total equity securities
|
2,096.8
|
|
|
4,345.2
|
|
|
4,345.2
|
|
|||
Short-term investments
|
$
|
1,798.8
|
|
|
$
|
1,798.8
|
|
|
$
|
1,798.8
|
|
Total investments
|
$
|
36,538.7
|
|
|
$
|
39,254.3
|
|
|
$
|
39,254.3
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Revenues
|
|
|
|
|
|
||||||
Dividends from subsidiaries
|
$
|
2,277.9
|
|
|
$
|
939.1
|
|
|
$
|
867.3
|
|
Undistributed income (loss) from subsidiaries
|
1,821.3
|
|
|
1,770.7
|
|
|
866.3
|
|
|||
Equity in net income of subsidiaries
|
4,099.2
|
|
|
2,709.8
|
|
|
1,733.6
|
|
|||
Intercompany investment income
|
31.1
|
|
|
39.4
|
|
|
11.3
|
|
|||
Gains (losses) on extinguishment of debt
|
0
|
|
|
0
|
|
|
0.2
|
|
|||
Total revenues
|
4,130.3
|
|
|
2,749.2
|
|
|
1,745.1
|
|
|||
Expenses
|
|
|
|
|
|
||||||
Interest expense
|
190.4
|
|
|
166.8
|
|
|
151.1
|
|
|||
Deferred compensation1
|
16.6
|
|
|
7.5
|
|
|
23.2
|
|
|||
Other operating costs and expenses
|
5.5
|
|
|
5.1
|
|
|
4.6
|
|
|||
Total expenses
|
212.5
|
|
|
179.4
|
|
|
178.9
|
|
|||
Income before income taxes
|
3,917.8
|
|
|
2,569.8
|
|
|
1,566.2
|
|
|||
Benefit for income taxes
|
52.5
|
|
|
45.5
|
|
|
26.0
|
|
|||
Net income attributable to Progressive
|
3,970.3
|
|
|
2,615.3
|
|
|
1,592.2
|
|
|||
Other comprehensive income (loss)
|
462.6
|
|
|
(95.2
|
)
|
|
348.8
|
|
|||
Comprehensive income attributable to Progressive
|
$
|
4,432.9
|
|
|
$
|
2,520.1
|
|
|
$
|
1,941.0
|
|
|
December 31,
|
||||||
|
2019
|
|
2018
|
||||
Assets
|
|
|
|
||||
Investment in affiliate
|
$
|
5.0
|
|
|
$
|
5.0
|
|
Investment in subsidiaries
|
16,186.8
|
|
|
13,652.2
|
|
||
Receivable from investment subsidiary
|
2,912.0
|
|
|
2,658.9
|
|
||
Intercompany receivable
|
678.6
|
|
|
651.1
|
|
||
Net deferred income taxes
|
70.3
|
|
|
68.2
|
|
||
Other assets
|
303.8
|
|
|
124.2
|
|
||
Total assets
|
$
|
20,156.5
|
|
|
$
|
17,159.6
|
|
Liabilities
|
|
|
|
||||
Accounts payable, accrued expenses, and other liabilities
|
$
|
475.2
|
|
|
$
|
250.5
|
|
Dividend payable
|
1,375.4
|
|
|
1,467.9
|
|
||
Debt
|
4,407.1
|
|
|
4,404.9
|
|
||
Total liabilities
|
6,257.7
|
|
|
6,123.3
|
|
||
Redeemable noncontrolling interest (NCI)
|
225.6
|
|
|
214.5
|
|
||
Shareholders’ Equity
|
|
|
|
||||
Serial Preferred Shares (authorized 20.0)
|
|
|
|
||||
Serial Preferred Shares, Series B, no par value (cumulative, liquidation preference $1,000 per share) (authorized, issued, and outstanding 0.5)
|
493.9
|
|
|
493.9
|
|
||
Common shares, $1.00 par value (authorized 900.0; issued 797.5, including treasury shares of 212.9 and 214.3)
|
584.6
|
|
|
583.2
|
|
||
Paid-in capital
|
1,573.4
|
|
|
1,479.0
|
|
||
Retained earnings
|
10,679.6
|
|
|
8,386.6
|
|
||
Total accumulated other comprehensive income attributable to Progressive
|
341.7
|
|
|
(120.9
|
)
|
||
Total shareholders’ equity
|
13,673.2
|
|
|
10,821.8
|
|
||
Total liabilities, redeemable NCI, and shareholders’ equity
|
$
|
20,156.5
|
|
|
$
|
17,159.6
|
|
|
Years Ended December 31,
|
||||||||||
|
2019
|
|
2018
|
|
2017
|
||||||
Cash Flows From Operating Activities:
|
|
|
|
|
|
||||||
Net income attributable to Progressive
|
$
|
3,970.3
|
|
|
$
|
2,615.3
|
|
|
$
|
1,592.2
|
|
Adjustments to reconcile net income attributable to Progressive to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Undistributed (income) loss from subsidiaries
|
(1,821.3
|
)
|
|
(1,770.7
|
)
|
|
(866.3
|
)
|
|||
Amortization of equity-based compensation
|
2.9
|
|
|
2.4
|
|
|
2.1
|
|
|||
(Gains) losses on extinguishment of debt
|
0
|
|
|
0
|
|
|
(0.2
|
)
|
|||
Changes in:
|
|
|
|
|
|
||||||
Intercompany receivable
|
(14.1
|
)
|
|
77.5
|
|
|
(71.3
|
)
|
|||
Accounts payable, accrued expenses, and other liabilities
|
47.1
|
|
|
(29.6
|
)
|
|
53.6
|
|
|||
Income taxes
|
175.5
|
|
|
(14.2
|
)
|
|
37.3
|
|
|||
Other, net
|
(179.8
|
)
|
|
47.8
|
|
|
(22.6
|
)
|
|||
Net cash provided by operating activities
|
2,180.6
|
|
|
928.5
|
|
|
724.8
|
|
|||
Cash Flows From Investing Activities:
|
|
|
|
|
|
||||||
Additional investments in equity securities of consolidated subsidiaries
|
(152.8
|
)
|
|
(178.3
|
)
|
|
(86.7
|
)
|
|||
Acquisition of additional shares - ARX
|
(5.4
|
)
|
|
(287.9
|
)
|
|
0
|
|
|||
Acquisition of an insurance company
|
0
|
|
|
0
|
|
|
(18.7
|
)
|
|||
(Paid to) received from investment subsidiary
|
(253.1
|
)
|
|
(1,192.8
|
)
|
|
(344.2
|
)
|
|||
Net cash used in investing activities
|
(411.3
|
)
|
|
(1,659.0
|
)
|
|
(449.6
|
)
|
|||
Cash Flows From Financing Activities:
|
|
|
|
|
|
||||||
Net proceeds from debt issuance
|
0
|
|
|
1,134.0
|
|
|
841.1
|
|
|||
Net proceeds from preferred stock issuance
|
0
|
|
|
493.9
|
|
|
0
|
|
|||
Reacquisitions of debt
|
0
|
|
|
0
|
|
|
(594.4
|
)
|
|||
Dividends paid to common shareholders
|
(1,643.2
|
)
|
|
(654.9
|
)
|
|
(395.4
|
)
|
|||
Dividends paid to preferred shareholders
|
(26.8
|
)
|
|
(13.5
|
)
|
|
0
|
|
|||
Acquisition of treasury shares for restricted stock tax liabilities
|
(84.4
|
)
|
|
(78.6
|
)
|
|
(57.6
|
)
|
|||
Acquisition of treasury shares acquired in open market
|
(6.9
|
)
|
|
(0.4
|
)
|
|
(4.9
|
)
|
|||
Loan to ARX Holding Corp.
|
(8.0
|
)
|
|
(150.0
|
)
|
|
(64.0
|
)
|
|||
Net cash provided by (used in) financing activities
|
(1,769.3
|
)
|
|
730.5
|
|
|
(275.2
|
)
|
|||
Change in cash, cash equivalents, and restricted cash
|
0
|
|
|
0
|
|
|
0
|
|
|||
Cash, cash equivalents, restricted cash - Beginning of year
|
0
|
|
|
0
|
|
|
0
|
|
|||
Cash, cash equivalents, restricted cash - End of year
|
$
|
0
|
|
|
$
|
0
|
|
|
$
|
0
|
|
(millions)
|
2019
|
|
2018
|
|
2017
|
||||||
Income taxes
|
$
|
925.0
|
|
|
$
|
679.2
|
|
|
$
|
669.7
|
|
Interest
|
184.9
|
|
|
153.6
|
|
|
142.2
|
|
Segment
|
Deferred
policy acquisition costs1 |
|
Future
policy benefits, losses, claims, and loss expenses1 |
|
Unearned premiums1
|
|
Other
policy claims and benefits payable1 |
|
Premium revenue
|
|
Net
investment income1,2 |
|
Benefits,
claims, losses, and settlement expenses |
|
Amortization
of deferred policy acquisition costs |
|
Other
operating expenses1 |
|
Net premiums
written
|
||||||||||||||||||||
Year ended December 31, 2019:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Personal Lines
|
|
|
|
|
|
|
|
|
$
|
30,210.0
|
|
|
|
|
$
|
21,329.7
|
|
|
$
|
2,273.6
|
|
|
$
|
4,227.6
|
|
|
$
|
31,102.2
|
|
||||||||||
Commercial Lines
|
|
|
|
|
|
|
|
|
4,427.6
|
|
|
|
|
3,034.8
|
|
|
481.2
|
|
|
523.5
|
|
|
4,791.8
|
|
|||||||||||||||
Property
|
|
|
|
|
|
|
|
|
1,554.8
|
|
|
|
|
1,106.0
|
|
|
268.4
|
|
|
224.0
|
|
|
1,683.9
|
|
|||||||||||||||
Other indemnity
|
|
|
|
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||||||||||
Total
|
$
|
1,056.5
|
|
|
$
|
18,105.4
|
|
|
$
|
12,388.8
|
|
|
$
|
0
|
|
|
$
|
36,192.4
|
|
|
$
|
1,017.4
|
|
|
$
|
25,470.5
|
|
|
$
|
3,023.2
|
|
|
$
|
4,975.1
|
|
|
$
|
37,577.9
|
|
Year ended December 31, 2018:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Personal Lines
|
|
|
|
|
|
|
|
|
$
|
26,034.7
|
|
|
|
|
$
|
18,389.8
|
|
|
$
|
1,964.4
|
|
|
$
|
3,563.3
|
|
|
$
|
27,157.6
|
|
||||||||||
Commercial Lines
|
|
|
|
|
|
|
|
|
3,610.9
|
|
|
|
|
2,394.0
|
|
|
396.0
|
|
|
396.0
|
|
|
3,996.4
|
|
|||||||||||||||
Property
|
|
|
|
|
|
|
|
|
1,287.7
|
|
|
|
|
937.0
|
|
|
213.3
|
|
|
237.2
|
|
|
1,455.9
|
|
|||||||||||||||
Other indemnity
|
|
|
|
|
|
|
|
|
0
|
|
|
|
|
0.2
|
|
|
0
|
|
|
(0.7
|
)
|
|
0
|
|
|||||||||||||||
Total
|
$
|
951.6
|
|
|
$
|
15,400.8
|
|
|
$
|
10,686.5
|
|
|
$
|
0
|
|
|
$
|
30,933.3
|
|
|
$
|
796.2
|
|
|
$
|
21,721.0
|
|
|
$
|
2,573.7
|
|
|
$
|
4,195.8
|
|
|
$
|
32,609.9
|
|
Year ended December 31, 2017:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Personal Lines
|
|
|
|
|
|
|
|
|
$
|
21,947.2
|
|
|
|
|
$
|
16,141.4
|
|
|
$
|
1,656.4
|
|
|
$
|
2,954.8
|
|
|
$
|
22,928.4
|
|
||||||||||
Commercial Lines
|
|
|
|
|
|
|
|
|
2,793.9
|
|
|
|
|
1,966.4
|
|
|
309.3
|
|
|
335.3
|
|
|
3,112.7
|
|
|||||||||||||||
Property
|
|
|
|
|
|
|
|
|
988.8
|
|
|
|
|
700.2
|
|
|
159.2
|
|
|
190.4
|
|
|
1,091.0
|
|
|||||||||||||||
Other indemnity
|
|
|
|
|
|
|
|
|
0
|
|
|
|
|
0
|
|
|
0
|
|
|
0.2
|
|
|
0
|
|
|||||||||||||||
Total
|
$
|
780.5
|
|
|
$
|
13,086.9
|
|
|
$
|
8,903.5
|
|
|
$
|
0
|
|
|
$
|
25,729.9
|
|
|
$
|
539.2
|
|
|
$
|
18,808.0
|
|
|
$
|
2,124.9
|
|
|
$
|
3,480.7
|
|
|
$
|
27,132.1
|
|
Year Ended:
|
Gross Amount
|
|
Ceded to
Other Companies |
|
Assumed
From Other Companies |
|
Net Amount
|
|
Percentage
of Amount Assumed to Net |
|||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|||||||||
Premiums earned:
|
|
|
|
|
|
|
|
|
|
|||||||||
Property and liability insurance
|
$
|
37,519.7
|
|
|
$
|
1,327.3
|
|
|
$
|
0
|
|
|
$
|
36,192.4
|
|
|
0
|
%
|
December 31, 2018
|
|
|
|
|
|
|
|
|
|
|||||||||
Premiums earned:
|
|
|
|
|
|
|
|
|
|
|||||||||
Property and liability insurance
|
$
|
31,970.2
|
|
|
$
|
1,036.9
|
|
|
$
|
0
|
|
|
$
|
30,933.3
|
|
|
0
|
%
|
December 31, 2017
|
|
|
|
|
|
|
|
|
|
|||||||||
Premiums earned:
|
|
|
|
|
|
|
|
|
|
|||||||||
Property and liability insurance
|
$
|
26,425.7
|
|
|
$
|
695.8
|
|
|
$
|
0
|
|
|
$
|
25,729.9
|
|
|
0
|
%
|
|
|
|
|
THE PROGRESSIVE CORPORATION
|
|
March 2, 2020
|
By:
|
/s/ Susan Patricia Griffith
|
|
|
Susan Patricia Griffith
|
|
|
President and Chief Executive Officer
|
By:
|
/s/ Daniel P. Mascaro
|
March 2, 2020
|
|
Daniel P. Mascaro
|
|
|
Attorney-in-fact
|
|
EXHIBIT INDEX
|
||||||
Exhibit No.
Under Reg. S-K, Item 601 |
|
Form 10-K
Exhibit No. |
|
Description of Exhibit
|
|
If Incorporated by Reference, Documents with
Which Exhibit was Previously Filed with SEC |
4
|
|
4.13
|
|
|
Registration Statement No. 333-48935 (filed on March 31, 1998; Exhibit 4.1 therein)
|
|
4
|
|
4.14
|
|
|
Registration Statement No. 333-01745 (filed on March 15, 1996; Exhibit 4.2 therein)
|
|
4
|
|
4.15
|
|
|
Registration Statement No. 333-100674 (filed on October 22, 2002; Exhibit 4.3 therein)
|
|
4
|
|
4.16
|
|
|
Registration Statement No. 333-143824 (filed on June 18, 2007; Exhibit 4.5 therein)
|
|
4
|
|
4.17
|
|
|
Registration Statement No. 333-143824 (filed on June 18, 2007; Exhibit 4.6 therein)
|
|
4
|
|
4.18
|
|
|
Annual Report on Form 10-K (filed on March 1, 2017; Exhibit 4.13 therein)
|
|
4
|
|
4.19
|
|
|
|
Current Report on Form 8-K (filed on April 25, 2014; Exhibit 4.1 therein)
|
4
|
|
4.20
|
|
|
Current Report on Form 8-K (filed on January 26, 2015; Exhibit 4.1 therein)
|
|
4
|
|
4.21
|
|
|
Current Report on Form 8-K (filed on August 25, 2016; Exhibit 4.1 therein)
|
|
4
|
|
4.22
|
|
|
Current Report on Form 8-K (filed on April 6, 2017; Exhibit 4.1 therein)
|
|
4
|
|
4.23
|
|
|
|
Filed herewith
|
EXHIBIT INDEX
|
||||||
Exhibit No.
Under
Reg. S-K,
Item 601
|
|
Form 10-K
Exhibit
No.
|
|
Description of Exhibit
|
|
If Incorporated by Reference, Documents with
Which Exhibit was Previously Filed with SEC
|
4
|
|
4.24
|
|
|
Current Report on Form 8-K (filed on March 14, 2018; Exhibit 4.1 therein)
|
|
4
|
|
4.25
|
|
|
Quarterly Report on Form 10-Q (filed on May 1, 2019; Exhibit 4.1 therein)
|
|
4
|
|
4.26
|
|
|
Quarterly Report on Form 10-Q (filed on May 11, 2015; Exhibit 4.2 therein)
|
|
10(i)
|
|
10.1
|
|
|
Annual Report on Form 10-K (filed on March 2, 2015; Exhibit 10.1 therein)
|
|
10(i)
|
|
10.2
|
|
|
Quarterly Report on Form 10-Q (filed on May 2, 2018; Exhibit 10.4 therein)
|
|
10(iii)
|
|
10.3
|
|
|
Filed herewith
|
|
10(iii)
|
|
10.4
|
|
|
|
Current Report on Form 8-K (filed on February 4, 2015; Exhibit 10.1 therein)
|
10(iii)
|
|
10.5
|
|
|
Quarterly Report on Form 10-Q (filed on May 1, 2019; Exhibit 10.1 therein)
|
|
10(iii)
|
|
10.6
|
|
|
Current Report on Form 8-K (filed on March 21, 2018; Exhibit 10.1 therein)
|
|
10(iii)
|
|
10.7
|
|
|
Current Report on Form 8-K (filed on August 23, 2018; Exhibit 10 therein)
|
|
10(iii)
|
|
10.8
|
|
|
Current Report on Form 8-K (filed on March 27, 2017; Exhibit 10.1 therein)
|
|
10(iii)
|
|
10.9
|
|
|
Quarterly Report on Form 10-Q (filed on May 5, 2016; Exhibit 10.1 therein)
|
|
10(iii)
|
|
10.10
|
|
|
Quarterly Report on Form 10-Q (filed on May 1, 2019; Exhibit 10.3 therein)
|
|
10(iii)
|
|
10.11
|
|
|
Current Report on Form 8-K (filed on March 21, 2018; Exhibit 10.2 therein)
|
EXHIBIT INDEX
|
||||||
Exhibit No.
Under
Reg. S-K,
Item 601
|
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Form 10-K
Exhibit
No.
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Description of Exhibit
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If Incorporated by Reference, Documents with
Which Exhibit was Previously Filed with SEC
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10(iii)
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10.12
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Current Report on Form 8-K (filed on March 27, 2017; Exhibit 10.2 therein)
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10(iii)
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10.13
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Quarterly Report on Form 10-Q (filed on May 1, 2019; Exhibit 10.2 therein)
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10(iii)
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10.14
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Current Report on Form 8-K (filed on March 21, 2018; Exhibit 10.3 therein)
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10(iii)
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10.15
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Current Report on Form 8-K (filed on February 21, 2017; Exhibit 10.1 therein)
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10(iii)
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10.16
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Quarterly Report on Form 10-Q (filed on August 7, 2019; Exhibit 10 therein)
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10(iii)
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10.17
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.3 therein)
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10(iii)
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10.18
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.4 therein)
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10(iii)
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10.19
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.5 therein)
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10(iii)
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10.20
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.6 therein)
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10(iii)
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10.21
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.7 therein)
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10(iii)
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10.22
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.8 therein)
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10(iii)
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10.23
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.9 therein)
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10(iii)
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10.24
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.10 therein)
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10(iii)
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10.25
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.11 therein)
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EXHIBIT INDEX
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||||||
Exhibit No.
Under
Reg. S-K,
Item 601
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Form 10-K
Exhibit
No.
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Description of Exhibit
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If Incorporated by Reference, Documents with
Which Exhibit was Previously Filed with SEC
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10(iii)
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10.26
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Current Report on Form 8-K (filed on October 14, 2014; Exhibit 10 therein)
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10(iii)
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10.27
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Annual Report on Form 10-K (filed on February 29, 2016; Exhibit 10.53 therein)
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10(iii)
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10.28
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Quarterly Report on Form 10-Q (filed on November 2, 2017; Exhibit 10 therein)
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10(iii)
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10.29
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Quarterly Report on Form 10-Q (filed on July 31, 2018; Exhibit 10 therein)
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10(iii)
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10.30
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.23 therein)
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10(iii)
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10.31
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.24 therein)
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10(iii)
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10.32
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.25 therein)
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10(iii)
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10.33
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.26 therein)
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10(iii)
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10.34
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.27 therein)
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10(iii)
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10.35
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.28 therein)
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10(iii)
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10.36
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.29 therein)
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10(iii)
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10.37
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Registration Statement No. 333-185704 (filed on December 27, 2012; Exhibit 4.30 therein)
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10(iii)
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10.38
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Annual Report on Form 10-K (filed on February 27, 2019; Exhibit 10.49 therein)
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10(iii)
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10.39
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Quarterly Report on Form 10-Q (filed on May 11, 2015; Exhibit 10.5 therein)
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10(iii)
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10.40
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Quarterly Report on Form 10-Q (filed on May 11, 2015; Exhibit 10.6 therein)
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10(iii)
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10.41
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Annual Report on Form 10-K (filed on February 27, 2018; Exhibit 10.91 therein)
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EXHIBIT INDEX
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||||||
Exhibit No.
Under
Reg. S-K,
Item 601
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Form 10-K
Exhibit
No.
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Description of Exhibit
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If Incorporated by Reference, Documents with
Which Exhibit was Previously Filed with SEC
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10(iii)
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10.42
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Annual Report on Form 10-K (filed on February 29, 2016; Exhibit 10.77 therein)
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10(iii)
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10.43
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Quarterly Report on Form 10-Q (filed on May 1, 2019; Exhibit 10.4 therein)
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10(iii)
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10.44
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Annual Report on Form 10-K (filed on February 27, 2019; Exhibit 10.56 therein)
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10(iii)
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10.45
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Filed herewith
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10(iii)
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10.46
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Current Report on Form 8-K (filed on May 16, 2017; Exhibit 10 therein)
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10(iii)
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10.47
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Annual Report on Form 10-K (filed on February 27, 2019; Exhibit 10.60 therein)
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10(iii)
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10.48
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Quarterly Report on Form 10-Q (filed on October 31, 2018; Exhibit 10.1 therein)
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10(iii)
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10.49
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Filed herewith
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13
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13
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Filed herewith
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21
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21
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Filed herewith
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23
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23
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Filed herewith
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24
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24
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Filed herewith
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31
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31.1
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Filed herewith
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31
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31.2
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Filed herewith
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32
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32.1
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Filed herewith
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32
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32.2
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Filed herewith
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99
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99
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Filed herewith
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101
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101.INS
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XBRL Instance Document
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Filed herewith
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101
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101.SCH
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XBRL Taxonomy Extension Schema Document
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Filed herewith
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101
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101.CAL
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XBRL Taxonomy Extension Calculation Linkbase Document
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Filed herewith
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101
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101.DEF
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XBRL Taxonomy Extension Definition Linkbase Document
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Filed herewith
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EXHIBIT INDEX
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||||||
Exhibit No.
Under
Reg. S-K,
Item 601
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Form 10-K
Exhibit
No.
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Description of Exhibit
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If Incorporated by Reference, Documents with
Which Exhibit was Previously Filed with SEC
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101
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101.LAB
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XBRL Taxonomy Extension Label Linkbase Document
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Filed herewith
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101
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101.PRE
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XBRL Taxonomy Extension Presentation Linkbase Document
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Filed herewith
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•
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to receive dividends when, as and if declared by our Board of Directors out of funds legally available therefor; however, the terms of our outstanding preferred shares prohibit us from declaring or paying dividends or distributions on our common shares while our preferred shares are outstanding, unless all accrued and unpaid dividends on the preferred shares, including the full dividends for all current dividend periods, have been declared and paid or a sum sufficient for payment thereof set apart, subject to certain exceptions; and
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•
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in the event of liquidation of the company, to participate equally in all distributions of assets remaining after payment of liabilities and satisfaction of the liquidation preferences, if any, of the then-outstanding serial preferred shares and of the then-outstanding voting preference shares, as provided in our Articles.
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(i)
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before the interested shareholder’s share acquisition date, the board of directors approved the purchase of shares by the interested shareholder;
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(ii)
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the transaction is approved by the holders of shares with at least 66 2/3% of the voting power of the corporation (or a different proportion set forth in the articles of incorporation), including at least a majority of the outstanding shares after excluding shares controlled by the Ohio law interested shareholder; or
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(iii)
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the business combination results in shareholders, other than the Ohio law interested shareholder, receiving a fair price plus interest for their shares.
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POSITION
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TARGET %
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Chief Executive Officer and Other Executive Officers
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Determined by the Compensation Committee
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Other Senior Executives and Executive Level Managers
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60 - 150%
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Business Leaders
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35 - 60%
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Directors and Senior Directors
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20 - 35%
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Middle Managers and Senior Managers
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15 - 20%
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Senior Professionals and Entry Level Managers
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8 - 20%
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Administrative Support and Entry Level Professionals
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0 - 8%
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6.
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The Performance Factor.
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•
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The Agency Auto business unit, consisting of the auto business produced by independent agents or brokers, including Strategic Alliances Agency auto, but excluding all Agency special lines businesses;
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•
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The Direct Auto business unit, consisting of the personal auto business produced by phone, over the Internet, or via a mobile device, but excluding all Direct special lines businesses;
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•
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The special lines business unit, which shall consist of special lines businesses generated by agents and brokers or directly by phone, over the Internet, or via a mobile device;
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•
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The Commercial Lines business unit; and
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•
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The Property business unit.
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•
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Agency Auto;
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•
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Direct Auto;
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•
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Special lines;
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•
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Commercial Lines; and
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•
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Property.
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A.
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Executive Team.
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B.
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Other Participants.
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A.
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Recoupment. Progressive shall have the right to recoup any Annual Gainsharing Payment (or an appropriate portion thereof, as hereinafter provided) with respect to any Plan year paid to a participant hereunder who was an executive officer of Progressive at any time during such Plan year, if: (i) the Annual Gainsharing Payment was calculated by reference to the achievement during such Plan year of certain financial or operating results (which includes, for purposes hereof, the Performance Factor described in Section 6); (ii) such financial or operating results were incorrect and were subsequently the subject of a restatement by Progressive within three (3) years after the date on which such Annual Gainsharing Payment was paid to the participant; and (iii) the Annual Gainsharing Payment would not have been paid, in whole or in part, to the participant if the restated financial or operating results had been known at the time the payment was made. Such recoupment right shall be available to Progressive whether or not the participant in question was at fault or responsible in any way in causing such restatement. In such circumstances, Progressive will have the right to recover from each such participant for such Plan year, and each such participant will refund to Progressive promptly upon demand, the amount by which the Annual Gainsharing Payment paid to such participant for the Plan year in question exceeded the payment that would have been made if the Annual Gainsharing Payment had been calculated by reference to the restated results, without interest; provided, however, that Progressive will not seek to recover such amounts from any participant who is not a member of the Executive Team unless the amount due would exceed the lesser of five percent (5%) of the Annual Gainsharing Payment previously paid or twenty-thousand dollars ($20,000). Such recovery, at the Committee’s
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B.
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Further Rights. Notwithstanding the foregoing subsection A., if any participant that was an executive officer at any time during such Plan year engaged in fraud or other misconduct (as determined by the Committee or the Board, in their respective sole discretion) resulting, in whole or in part, in a restatement of the financial or operating results used hereunder to determine the Annual Gainsharing Payments for a specific Plan year, Progressive will further have the right to recover from such participant, and the participant will refund to Progressive upon demand, an amount equal to the entire Annual Gainsharing Payment paid to such participant for such Plan year plus interest at the rate of eight percent (8%) per annum or, if lower, the highest rate permitted by law, calculated from the date that such bonus was paid to the participant. Progressive shall further have the right to recover from such participant Progressive’s costs and expenses incurred in connection with recovering such Annual Gainsharing Payment from the participant and enforcing its rights under this subsection B., including, without limitation, reasonable attorneys’ fees. There shall be no time limit on the Company’s right to recover such amounts under this subsection B., except as otherwise provided by applicable law. References in this paragraph to payments and amounts paid shall be deemed to include amounts deposited into the Deferral Plan as a result of an election by the participant.
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C.
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Compliance with Law and Exchange Requirements. The Annual Gainsharing Payments determined and paid pursuant to the Plan shall be subject to all applicable laws and regulations. Without limiting the foregoing, and notwithstanding anything to the contrary contained in this Plan, if the SEC adopts final rules under Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that require, as a condition to the Company’s continued listing on a national securities exchange (“Exchange”), that the Company develop and implement a policy requiring the recovery of erroneously awarded compensation, and such regulations are applicable to a participant awarded Annual Gainsharing Payments pursuant to the Plan, then the Annual Gainsharing Payment paid to such participant (and any payment made to a participant pursuant to a similar plan or an award under The Progressive Corporation 2017 Executive Annual Incentive Plan) shall be subject to recoupment by the Company pursuant to the terms of the rules of the SEC and any applicable Exchange and any policy of the Company adopted in response to such rules. References in this paragraph to payments and amounts paid shall be deemed to include amounts deposited into the Deferral Plan as a result of an election by the participant.
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D.
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Rights Not Exclusive. The rights contained in the foregoing subsections A. through C. shall be in addition to, and shall not limit, any other rights or remedies that the Company may have under any applicable law or regulation. Nothing contained in subsections A. through C. shall be deemed to limit any additional legal or equitable rights or remedies the Company may have under applicable law with respect to any participant who may have caused or contributed to the Company's need to restate its financial results. If any of the provisions of subsections A. through C., or any part thereof, are held to be unenforceable, the court making such determination shall have the power to revise or modify such provision to make it enforceable to the maximum extent permitted by applicable law and, in its revised or modified form, said provision shall then be enforceable.
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Chairperson of the Board
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$450,000
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Audit Committee Chair
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300,000
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Audit Committee Member
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275,000
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Compensation Committee Chair
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290,000
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Compensation Committee Member
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265,000
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Investment and Capital Committee Chair
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290,000
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Investment and Capital Committee Member
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265,000
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New Director without a committee assignment
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265,000
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Nominating and Governance Committee Chair1
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20,000
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Nominating and Governance Committee Member1
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15,000
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1.
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The Plan. The Progressive Corporation and its subsidiaries (collectively "Progressive" or the “Company”) have adopted the 2020 Progressive Capital Management Annual Incentive Plan (the “Plan”) as part of their compensation program for the Company’s investment professionals for the Company’s 2020 fiscal year (the “Plan year”). The Plan is performance-based, is not a form of commission compensation, and is administered under the direction of the Compensation Committee of the Board of Directors of The Progressive Corporation (the “Compensation Committee” or “Committee”). Payment under the Plan, if any, is based on Company performance as defined by the Plan, not individual employee performance. References in this Plan to the Company’s portfolio mean the respective portfolios of the Company’s subsidiaries and affiliates that are actively managed by Progressive Capital Management Corp. (“PCM”) and references in this Plan to the Company’s investment results mean the investment results of those portfolios only.
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2.
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Participants. Progressive employees who are assigned primarily to the Company’s capital management function, including the Company’s Chief Investment Officer (“CIO”), are eligible to be selected for participation in the Plan. Eligible employees in addition to the CIO will be selected by the CIO in consultation with the Chief Executive Officer (“CEO”) or Chief Human Resource Officer (“CHRO”) (the “Designated Executives”) to participate in the Plan. Participants may also participate in other gainsharing, bonus or incentive compensation plans maintained by Progressive, if so determined by the Designated Executives (or in the case of the CIO or any other executive officer, by the Compensation Committee). Other eligible employees of the Company may be selected for participation in the Plan for or at any time during the Plan year by the Designated Executives. In such cases, the Designated Executives will determine the new participant’s Target Percentage (described below) and other terms of participation (except with respect to the CIO or any other executive officer, as to whom all determinations must be made by the Committee). Throughout this Plan, references to “executive officers” refer to executive officers of The Progressive Corporation within the meaning of any Securities and Exchange Commission (“SEC”) or New York Stock Exchange rule applicable to the Company.
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A.
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Annual Incentive Payment. Each participant may earn an annual cash bonus (the “Annual Incentive Payment”), subject to the terms of this Plan. The amount of the Annual Incentive Payment earned by any participant will be determined by application of the following formula:
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B.
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Paid Eligible Earnings. Paid Eligible Earnings for the Plan year shall mean and include the following: regular, Earned Time Benefit pay (including Protected ETB-PSL but excluding
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Comparison
Period
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Score = 0
Rank at or below
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Score = 1.0
Rank equal to
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Score = 2.0
Rank at or above
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One year
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15th Percentile
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50th Percentile
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85th Percentile
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Three year
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25th Percentile
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50th Percentile
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75th Percentile
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•
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the primary investment factors that are responsible for favorable or unfavorable results relative to the peer group, such as the Company’s duration and yield curve position and the extent of its exposure to sectors of the fixed-income markets, including corporate bonds, residential mortgage-backed securities, commercial mortgage-backed securities, other asset-backed securities, government bonds, preferred stocks and non-investment-grade bonds;
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•
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the Company’s holdings within each sector relative to the general market composition of each sector;
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•
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the extent to which material investment decisions may have been driven by Company strategic or capital considerations; and
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•
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the impact on investment results of significant portfolio cash flows driven by Company operations, strategic decisions or capital transactions.
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4.
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Payment Procedures; Deferral. The Annual Incentive Payments will be determined and paid to Plan participants as soon as practicable after the Performance Factor has been determined by the Committee, but no later than March 15th of the year immediately following the Plan year.
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5.
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Qualification Date; Leave of Absence; Withholding. Unless otherwise determined by the Committee, and except as otherwise expressly provided herein, in order to be entitled to receive an Annual Incentive Payment for the Plan year, the participant must be an active officer or regular employee of the Company on November 30 of the Plan year (“Qualification Date”). An individual who (i) is hired on or after December 1 of any Plan year, or (ii) whose employment terminates for any reason prior to the Qualification Date is not entitled to an Annual Incentive Payment for that Plan year. Annual Incentive Payments are not earned until paid.
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6.
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Other Plans. Participants may be selected to participate in this Plan and in one or more other incentive plans offered by the Company. In the case of the CIO or any other executive officer, all determinations with respect to such incentive plans and the executive’s participation therein shall be made by the Compensation Committee. In all other cases, the Designated Executives shall have full
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7.
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Non-Transferability. Annual Incentive Payments shall be payable only to the participant or, in the event of the participant’s death, to the participant’s estate. The right to any Annual Incentive Payment hereunder may not be sold, transferred, assigned or encumbered, voluntarily or involuntarily, other than by will or the laws of descent or distribution. Nothing herein shall prevent any participant's interest hereunder from being subject to involuntary attachment, levy or other legal process.
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8.
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Administration. The Plan will be administered by or under the direction of the Committee. The Committee will have the authority to adopt, alter, amend, modify, revise and repeal such rules, guidelines, procedures and practices governing the Plan as it, from time to time, in its sole discretion deem advisable.
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9.
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Miscellaneous.
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A.
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Recoupment. Progressive shall have the right to recoup any Annual Incentive Payment (or an appropriate portion thereof, as hereinafter provided) with respect to any Plan year paid to a participant hereunder who was an executive officer of Progressive at any time during such Plan year, if: (i) the Annual Incentive Payment was calculated by reference to the achievement during such Plan year of certain financial or operating results (which includes, for purposes hereof, the performance of the Fixed-Income Portfolio); (ii) such financial or operating results were incorrect and were subsequently the subject of a restatement by Progressive within three (3) years after the date on which such Annual Incentive Payment was paid to the participant; and (iii) the Annual Incentive Payment would have been paid, in whole or in part, to the participant if the restated financial or operating results had been known at the time the payment was made. Such recoupment right shall be available to Progressive whether or not the participant in question was at fault or responsible in any way in causing such restatement. In such
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B.
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Further Rights. Notwithstanding the foregoing subsection A., if any participant that was an executive officer at any time during such Plan year engaged in fraud or other misconduct (as determined by the Committee or the Board, in their respective sole discretion) resulting, in whole or in part, in a restatement of the financial or operating results used hereunder to determine the Annual Incentive Payments for a specific Plan year, Progressive will further have the right to recover from such participant, and the participant will refund to Progressive upon demand, an amount equal to the entire Annual Incentive Payment paid to such participant for such Plan year plus interest at the rate of eight percent (8%) per annum or, if lower, the highest rate permitted by law, calculated from the date that such bonus was paid to the participant. Progressive shall further have the right to recover from such participant Progressive’s costs and expenses incurred in connection with recovering such Annual Incentive Payment from the participant and enforcing its rights under this subsection B., including, without limitation, reasonable attorneys’ fees. There shall be no time limit on the Company’s right to recover such amounts under this subsection B., except as otherwise provided by applicable law. References in this paragraph to payments and amounts paid shall be deemed to include amounts deposited into the Deferral Plan as a result of an election by the participant.
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C.
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Compliance with Law and Exchange Requirements. The Annual Incentive Payments determined and paid pursuant to the Plan shall be subject to all applicable laws and regulations. Without limiting the foregoing, and notwithstanding anything to the contrary contained in this Plan, if the SEC adopts final rules under Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that require, as a condition to the Company’s continued listing on a national securities exchange (“Exchange”), that the Company develop and implement a policy requiring the recovery of erroneously awarded compensation, and such regulations are applicable to a participant awarded an Annual Incentive Payment pursuant to the Plan, then the Annual Incentive Payment paid to such participant (and any payment made to such participant pursuant to a similar plan) shall be subject to recoupment by the Company pursuant to the terms of the rules of the SEC and any applicable Exchange and any policy of the Company adopted in response to such rules. References in this paragraph to payments and amounts paid shall be deemed to include amounts deposited into the Deferral Plan as a result of an election by the participant.
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D.
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Rights Not Exclusive. The rights contained in the foregoing subsections A. through C. shall be in addition to, and shall not limit, any other rights or remedies that the Company may have under any applicable law or regulation. Nothing contained in subsections A. through C. shall be
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10.
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Termination; Amendments. The Plan may be suspended, terminated, amended or revised, in whole or in part, at any time and from time to time by the Committee, in its sole discretion.
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11.
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Unfunded Obligations. The Plan will be unfunded and all payments due under the Plan will be made from Progressive's general assets.
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12.
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No Employment Rights. Nothing in the Plan, and no action hereunder, shall be construed as conferring upon any person the right to remain a participant in the Plan or to remain employed by Progressive, nor shall the Plan limit Progressive's right to discipline or discharge any of its officers or employees or change any of their job titles, duties, authority or compensation, at any time and without assigning a reason therefor.
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13.
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Set-off Rights. Progressive shall have the unrestricted right to set off against or recover out of any Annual Incentive Payment or other sums owed to any participant under the Plan any amounts owed by such participant (including pursuant to Section 9) to Progressive.
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14.
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Misconduct. No participant shall have the right to receive any Annual Incentive Payment if, prior to such payment being made, participant’s employment is terminated as a result of any action or inaction that, under Progressive’s employment practices or policies as then in effect, constitutes grounds for immediate termination of employment, as determined by Progressive (or, in the case of an executive officer, the Committee) in its sole discretion. In addition, no participant who is an executive officer shall have the right to receive any Annual Incentive Payment if, prior to such payment being made, participant’s employment is terminated by Progressive for Cause, or if there occurs any action or inaction that constitutes grounds for termination for Cause or otherwise constitutes grounds for immediate termination of employment under the Company’s employment practices or policies as then in effect, as determined by the Committee in its sole discretion. For purposes of this Section 14, “Cause” shall mean a felony conviction of a participant or the failure of a participant to contest prosecution for a felony; a participant’s willful misconduct or dishonesty, any of which, in the judgment of the Committee, is harmful to the business or reputation of Progressive; or any material violation (in the judgment of the Committee) of any of the provisions of the Company’s Code of Business Conduct and Ethics or the Chief Executive Officer/Senior Financial Officer’s Code of Ethics (if applicable to the participant), or any confidentiality agreement, non-solicitation agreement, non-competition agreement or other agreement between the participant and Progressive.
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15.
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Employees Subject to Foreign Jurisdictions. To the extent the Committee deems it necessary, appropriate or desirable to comply with foreign law or practice or taxation and to further the purposes of the Plan, the Committee may, without amending the Plan, exclude any employee not temporarily or permanently residing in the United States from participating in the Plan or establish rules applicable to Annual Incentive Payments to participants who are foreign nationals or foreign residents, are employed outside the United States, or both, including rules that differ from those set forth in this Plan.
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16.
|
Section 409A. Payments under the Plan are intended to be exempt from Section 409A because no legally binding right to any Annual Incentive Payment arises until the payment date, and, in the alternative, because any payment is a short term deferral under Section 409A; the Plan shall be administered and interpreted accordingly. Notwithstanding any provision of the Plan to the contrary, if the Committee determines that any payment under the Plan may constitute deferred compensation subject to Section 409A, the Committee may take any actions necessary to preserve the intended tax treatment of the benefits provided with respect to such payment. Any benefit under the Plan that is subject to Section 409A because deferred pursuant to the terms of the Deferral Plan shall be paid according to the terms of such plan.
|
17.
|
Prior Plans. This Plan supersedes all prior plans, agreements, understandings and arrangements regarding bonuses or other cash incentive compensation payable or due to any participant from Progressive with respect to the performance of Progressive’s investment portfolio. Without limiting the generality of the foregoing, this Plan supersedes and replaces the 2019 Progressive Capital Management Annual Incentive Plan (the "Prior Plan”), which is and shall be deemed to have terminated on the last day of the Company’s 2019 fiscal year (the "Prior Plan Termination Date"); provided, however, that (a) any bonuses or other sums earned and payable under the Prior Plan with respect to any Plan year ended on or prior to the Prior Plan Termination Date shall be unaffected by such termination and shall be paid to the appropriate participants when and as provided thereunder, and (b) any provisions regarding recoupment of payments from executive officers and the administrative and interpretive authority of the Committee and/or the Designated Officers under the Prior Plan shall survive.
|
18.
|
Effective Date. This Plan is adopted, and is effective, as of the first day of the Company’s 2020 fiscal year and will be effective for the 2020 Plan year (which coincides with Progressive’s 2020 fiscal year, except that investment returns are calculated on a calendar year basis).
|
19.
|
Governing Law. This Plan shall be governed by, and interpreted and construed in accordance with, the laws of the State of Ohio applicable to contracts made and performed wholly within such state by residents thereof.
|
1.
|
The firm has provided monthly data regarding its holdings and investment return, as necessary to determine or calculate such firm’s monthly total return, and to evaluate such firm’s compliance with each of the criteria set forth below, for the entire three-year period ending on December 31 of the Plan year; and
|
2.
|
At all times during the three-year period ending on December 31 of the Plan year, the information provided by the firm shows, or the Independent Data Source is able to calculate, that such firm’s investment portfolio satisfies each of the following criteria:
|
3.
|
The Company will have no discretion to alter the Investment Benchmark list after it is finalized by the Independent Data Source.
|
Firm
|
Performance score
|
Total return
|
Firm above PCM
|
.90
|
13.61
|
PCM
|
|
13.39
|
Firm below PCM
|
.89
|
13.34
|
(millions - except per share amounts)
|
2019
|
|
2018
|
|
2017
|
|
|||
Revenues
|
|
|
|
||||||
Net premiums earned
|
$
|
36,192.4
|
|
$
|
30,933.3
|
|
$
|
25,729.9
|
|
Investment income
|
1,042.0
|
|
820.5
|
|
563.1
|
|
|||
Net realized gains (losses) on securities:
|
|
|
|
||||||
Net realized gains (losses) on security sales
|
334.6
|
|
170.7
|
|
115.7
|
|
|||
Net holding period gains (losses) on securities
|
757.9
|
|
(507.9
|
)
|
(1.6
|
)
|
|||
Net impairment losses recognized in earnings
|
(63.3
|
)
|
(68.3
|
)
|
(64.5
|
)
|
|||
Total net realized gains (losses) on securities
|
1,029.2
|
|
(405.5
|
)
|
49.6
|
|
|||
Fees and other revenues
|
563.7
|
|
472.2
|
|
370.6
|
|
|||
Service revenues
|
195.0
|
|
158.5
|
|
126.8
|
|
|||
Other gains (losses)
|
0
|
|
0
|
|
(1.0
|
)
|
|||
Total revenues
|
39,022.3
|
|
31,979.0
|
|
26,839.0
|
|
|||
Expenses
|
|
|
|
||||||
Losses and loss adjustment expenses
|
25,470.5
|
|
21,721.0
|
|
18,808.0
|
|
|||
Policy acquisition costs
|
3,023.2
|
|
2,573.7
|
|
2,124.9
|
|
|||
Other underwriting expenses
|
4,975.1
|
|
4,195.8
|
|
3,480.7
|
|
|||
Investment expenses
|
24.6
|
|
24.3
|
|
23.9
|
|
|||
Service expenses
|
178.9
|
|
134.1
|
|
109.5
|
|
|||
Interest expense
|
189.7
|
|
166.5
|
|
153.1
|
|
|||
Total expenses
|
33,862.0
|
|
28,815.4
|
|
24,700.1
|
|
|||
Net Income
|
|
|
|
||||||
Income before income taxes
|
5,160.3
|
|
3,163.6
|
|
2,138.9
|
|
|||
Provision for income taxes
|
1,180.3
|
|
542.6
|
|
540.8
|
|
|||
Net income
|
3,980.0
|
|
2,621.0
|
|
1,598.1
|
|
|||
Net (income) loss attributable to noncontrolling interest (NCI)
|
(9.7
|
)
|
(5.7
|
)
|
(5.9
|
)
|
|||
Net income attributable to Progressive
|
3,970.3
|
|
2,615.3
|
|
1,592.2
|
|
|||
Other Comprehensive Income (Loss)
|
|
|
|
||||||
Changes in:
|
|
|
|
||||||
Total net unrealized gains (losses) on fixed-maturity securities
|
466.4
|
|
(99.3
|
)
|
355.4
|
|
|||
Net unrealized losses on forecasted transactions
|
0.8
|
|
0.8
|
|
(5.4
|
)
|
|||
Foreign currency translation adjustment
|
0
|
|
0
|
|
1.1
|
|
|||
Other comprehensive income (loss)
|
467.2
|
|
(98.5
|
)
|
351.1
|
|
|||
Other comprehensive (income) loss attributable to NCI
|
(4.6
|
)
|
3.3
|
|
(2.3
|
)
|
|||
Comprehensive income attributable to Progressive
|
$
|
4,432.9
|
|
$
|
2,520.1
|
|
$
|
1,941.0
|
|
Computation of Earnings Per Common Share
|
|
|
|
||||||
Net income attributable to Progressive
|
$
|
3,970.3
|
|
$
|
2,615.3
|
|
$
|
1,592.2
|
|
Less: Preferred share dividends
|
26.9
|
|
21.4
|
|
0
|
|
|||
Net income available to common shareholders
|
$
|
3,943.4
|
|
$
|
2,593.9
|
|
$
|
1,592.2
|
|
Average common shares outstanding - Basic
|
583.8
|
|
582.4
|
|
580.8
|
|
|||
Net effect of dilutive stock-based compensation
|
3.4
|
|
4.3
|
|
4.9
|
|
|||
Total average equivalent common shares - Diluted
|
587.2
|
|
586.7
|
|
585.7
|
|
|||
Basic: Earnings per common share
|
$
|
6.75
|
|
$
|
4.45
|
|
$
|
2.74
|
|
Diluted: Earnings per common share
|
$
|
6.72
|
|
$
|
4.42
|
|
$
|
2.72
|
|
(millions - except per share amount)
|
2019
|
|
|
2018
|
|
||
Assets
|
|
|
|
||||
Available-for-sale securities, at fair value:
|
|
|
|
||||
Fixed maturities (amortized cost: $32,643.1 and $28,255.9)
|
$
|
33,110.3
|
|
|
$
|
28,111.5
|
|
Short-term investments (amortized cost: $1,798.8 and $1,795.9)
|
1,798.8
|
|
|
1,795.9
|
|
||
Total available-for-sale securities
|
34,909.1
|
|
|
29,907.4
|
|
||
Equity securities, at fair value:
|
|
|
|
||||
Nonredeemable preferred stocks (cost: $971.3 and $1,002.6)
|
1,038.9
|
|
|
1,033.9
|
|
||
Common equities (cost: $1,125.5 and $1,148.9)
|
3,306.3
|
|
|
2,626.1
|
|
||
Total equity securities
|
4,345.2
|
|
|
3,660.0
|
|
||
Total investments
|
39,254.3
|
|
|
33,567.4
|
|
||
Cash and cash equivalents
|
226.2
|
|
|
69.5
|
|
||
Restricted cash
|
1.2
|
|
|
5.5
|
|
||
Total cash, cash equivalents, and restricted cash
|
227.4
|
|
|
75.0
|
|
||
Accrued investment income
|
181.3
|
|
|
190.8
|
|
||
Premiums receivable, net of allowance for doubtful accounts of $283.2 and $252.1
|
7,507.3
|
|
|
6,497.1
|
|
||
Reinsurance recoverables
|
3,378.9
|
|
|
2,696.1
|
|
||
Prepaid reinsurance premiums
|
626.5
|
|
|
309.7
|
|
||
Deferred acquisition costs
|
1,056.5
|
|
|
951.6
|
|
||
Property and equipment, net of accumulated depreciation of $1,138.1 and $1,033.2
|
1,213.7
|
|
|
1,131.7
|
|
||
Goodwill
|
452.7
|
|
|
452.7
|
|
||
Intangible assets, net of accumulated amortization of $314.0 and $247.7
|
228.3
|
|
|
294.6
|
|
||
Net deferred income taxes
|
0
|
|
|
43.2
|
|
||
Other assets
|
768.4
|
|
|
365.1
|
|
||
Total assets
|
$
|
54,895.3
|
|
|
$
|
46,575.0
|
|
Liabilities
|
|
|
|
||||
Unearned premiums
|
$
|
12,388.8
|
|
|
$
|
10,686.5
|
|
Loss and loss adjustment expense reserves
|
18,105.4
|
|
|
15,400.8
|
|
||
Net deferred income taxes
|
132.5
|
|
|
0
|
|
||
Accounts payable, accrued expenses, and other liabilities1
|
5,962.7
|
|
|
5,046.5
|
|
||
Debt2
|
4,407.1
|
|
|
4,404.9
|
|
||
Total liabilities
|
40,996.5
|
|
|
35,538.7
|
|
||
Redeemable noncontrolling interest (NCI)3
|
225.6
|
|
|
214.5
|
|
||
Shareholders’ Equity
|
|
|
|
|
|
||
Serial Preferred Shares (authorized 20.0)
|
|
|
|
||||
Serial Preferred Shares, Series B, no par value (cumulative, liquidation preference $1,000 per share) (authorized, issued, and outstanding 0.5)
|
493.9
|
|
|
493.9
|
|
||
Common shares, $1.00 par value (authorized 900.0; issued 797.5, including treasury shares of 212.9 and 214.3)
|
584.6
|
|
|
583.2
|
|
||
Paid-in capital
|
1,573.4
|
|
|
1,479.0
|
|
||
Retained earnings
|
10,679.6
|
|
|
8,386.6
|
|
||
Accumulated other comprehensive income (loss):
|
|
|
|
||||
Net unrealized gains (losses) on fixed-maturity securities
|
360.8
|
|
|
(105.6
|
)
|
||
Net unrealized losses on forecasted transactions
|
(16.4
|
)
|
|
(17.2
|
)
|
||
Accumulated other comprehensive (income) loss attributable to NCI
|
(2.7
|
)
|
|
1.9
|
|
||
Total accumulated other comprehensive income (loss) attributable to Progressive
|
341.7
|
|
|
(120.9
|
)
|
||
Total shareholders’ equity
|
13,673.2
|
|
|
10,821.8
|
|
||
Total liabilities, redeemable NCI, and shareholders’ equity
|
$
|
54,895.3
|
|
|
$
|
46,575.0
|
|
(millions - except per share amounts)
|
2019
|
|
2018
|
|
2017
|
|
|||
Serial Preferred Shares, No Par Value
|
|
|
|
||||||
Balance, beginning of year
|
$
|
493.9
|
|
$
|
0
|
|
$
|
0
|
|
Issuance of Serial Preferred Shares, Series B
|
0
|
|
493.9
|
|
0
|
|
|||
Balance, end of year
|
493.9
|
|
493.9
|
|
0
|
|
|||
Common Shares, $1.00 Par Value
|
|
|
|
||||||
Balance, beginning of year
|
583.2
|
|
581.7
|
|
579.9
|
|
|||
Treasury shares purchased
|
(1.3
|
)
|
(1.4
|
)
|
(1.5
|
)
|
|||
Net restricted equity awards issued/vested
|
2.7
|
|
2.9
|
|
3.3
|
|
|||
Balance, end of year
|
584.6
|
|
583.2
|
|
581.7
|
|
|||
Paid-In Capital
|
|
|
|
||||||
Balance, beginning of year
|
1,479.0
|
|
1,389.2
|
|
1,303.4
|
|
|||
Amortization of equity-based compensation
|
90.1
|
|
76.2
|
|
92.9
|
|
|||
Treasury shares purchased
|
(3.2
|
)
|
(3.3
|
)
|
(3.4
|
)
|
|||
Net restricted equity awards issued/vested
|
(2.7
|
)
|
(2.9
|
)
|
(3.3
|
)
|
|||
Reinvested dividends on restricted stock units
|
10.6
|
|
12.2
|
|
8.0
|
|
|||
Adjustment to carrying amount of redeemable noncontrolling interest
|
(0.4
|
)
|
7.6
|
|
(8.4
|
)
|
|||
Balance, end of year
|
1,573.4
|
|
1,479.0
|
|
1,389.2
|
|
|||
Retained Earnings
|
|
|
|
||||||
Balance, beginning of year
|
8,386.6
|
|
6,031.7
|
|
5,140.4
|
|
|||
Net income attributable to Progressive
|
3,970.3
|
|
2,615.3
|
|
1,592.2
|
|
|||
Treasury shares purchased
|
(86.8
|
)
|
(74.3
|
)
|
(57.6
|
)
|
|||
Cash dividends declared on common shares ($2.65, $2.5140, and $1.1247 per share)
|
(1,548.4
|
)
|
(1,466.0
|
)
|
(654.2
|
)
|
|||
Cash dividends declared on Serial Preferred Shares, Series B ($53.75, $27.024, and $0 per share)
|
(26.8
|
)
|
(13.5
|
)
|
0
|
|
|||
Reinvested dividends on restricted stock units
|
(10.6
|
)
|
(12.2
|
)
|
(8.0
|
)
|
|||
Cumulative effect of change in accounting principle
|
0
|
|
1,300.2
|
|
0
|
|
|||
Reclassification of disproportionate tax effects
|
0
|
|
4.3
|
|
0
|
|
|||
Other, net
|
(4.7
|
)
|
1.1
|
|
18.9
|
|
|||
Balance, end of year
|
10,679.6
|
|
8,386.6
|
|
6,031.7
|
|
|||
Accumulated Other Comprehensive Income (Loss) Attributable to Progressive
|
|
|
|
||||||
Balance, beginning of year
|
(120.9
|
)
|
1,282.2
|
|
933.4
|
|
|||
Attributable to noncontrolling interest
|
(4.6
|
)
|
(0.1
|
)
|
(2.3
|
)
|
|||
Other comprehensive income (loss)
|
467.2
|
|
(98.5
|
)
|
351.1
|
|
|||
Cumulative effect of change in accounting principle
|
0
|
|
(1,300.2
|
)
|
0
|
|
|||
Reclassification of disproportionate tax effects
|
0
|
|
(4.3
|
)
|
0
|
|
|||
Balance, end of year
|
341.7
|
|
(120.9
|
)
|
1,282.2
|
|
|||
Total shareholders’ equity
|
$
|
13,673.2
|
|
$
|
10,821.8
|
|
$
|
9,284.8
|
|
(millions)
|
2019
|
|
2018
|
|
2017
|
|
|||
Cash Flows From Operating Activities
|
|
|
|
||||||
Net income
|
$
|
3,980.0
|
|
$
|
2,621.0
|
|
$
|
1,598.1
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||||
Depreciation
|
239.8
|
|
190.4
|
|
169.9
|
|
|||
Amortization of intangible assets
|
66.3
|
|
72.0
|
|
66.2
|
|
|||
Net amortization of fixed-income securities
|
33.3
|
|
34.3
|
|
86.2
|
|
|||
Amortization of equity-based compensation
|
90.2
|
|
77.2
|
|
95.4
|
|
|||
Net realized (gains) losses on securities
|
(1,029.2
|
)
|
405.5
|
|
(49.6
|
)
|
|||
Net (gains) losses on disposition of property and equipment
|
11.0
|
|
32.1
|
|
7.2
|
|
|||
Other (gains) losses
|
0
|
|
0
|
|
1.0
|
|
|||
Changes in:
|
|
|
|
||||||
Premiums receivable
|
(1,010.2
|
)
|
(1,074.6
|
)
|
(913.2
|
)
|
|||
Reinsurance recoverables
|
(682.8
|
)
|
(422.7
|
)
|
(388.6
|
)
|
|||
Prepaid reinsurance premiums
|
(316.8
|
)
|
(106.4
|
)
|
(32.8
|
)
|
|||
Deferred acquisition costs
|
(104.9
|
)
|
(171.1
|
)
|
(129.3
|
)
|
|||
Income taxes
|
227.2
|
|
(158.7
|
)
|
(172.6
|
)
|
|||
Unearned premiums
|
1,702.3
|
|
1,783.0
|
|
1,434.9
|
|
|||
Loss and loss adjustment expense reserves
|
2,704.6
|
|
2,313.9
|
|
1,718.8
|
|
|||
Accounts payable, accrued expenses, and other liabilities
|
611.6
|
|
746.6
|
|
400.0
|
|
|||
Other, net
|
(260.8
|
)
|
(57.7
|
)
|
(134.8
|
)
|
|||
Net cash provided by operating activities
|
6,261.6
|
|
6,284.8
|
|
3,756.8
|
|
|||
Cash Flows From Investing Activities
|
|
|
|
||||||
Purchases:
|
|
|
|
||||||
Fixed maturities
|
(28,765.2
|
)
|
(21,153.0
|
)
|
(14,587.8
|
)
|
|||
Equity securities
|
(379.9
|
)
|
(538.8
|
)
|
(255.6
|
)
|
|||
Sales:
|
|
|
|
||||||
Fixed maturities
|
18,412.7
|
|
7,835.6
|
|
5,382.5
|
|
|||
Equity securities
|
471.4
|
|
823.5
|
|
252.9
|
|
|||
Maturities, paydowns, calls, and other:
|
|
|
|
||||||
Fixed maturities
|
6,145.5
|
|
5,099.8
|
|
5,215.8
|
|
|||
Equity securities
|
49.9
|
|
26.6
|
|
50.0
|
|
|||
Net sales of short-term investments
|
31.5
|
|
1,116.3
|
|
727.6
|
|
|||
Net unsettled security transactions
|
6.0
|
|
11.7
|
|
(33.6
|
)
|
|||
Purchases of property and equipment
|
(363.5
|
)
|
(266.0
|
)
|
(155.7
|
)
|
|||
Sales of property and equipment
|
53.3
|
|
9.4
|
|
15.3
|
|
|||
Acquisition of an insurance company, net of cash acquired
|
0
|
|
0
|
|
(18.1
|
)
|
|||
Net cash used in investing activities
|
(4,338.3
|
)
|
(7,034.9
|
)
|
(3,406.7
|
)
|
|||
Cash Flows From Financing Activities
|
|
|
|
||||||
Dividends paid to common shareholders
|
(1,643.2
|
)
|
(654.9
|
)
|
(395.4
|
)
|
|||
Dividends paid to preferred shareholders
|
(26.8
|
)
|
(13.5
|
)
|
0
|
|
|||
Acquisition of treasury shares for restricted stock tax liabilities
|
(84.4
|
)
|
(78.6
|
)
|
(57.6
|
)
|
|||
Acquisition of treasury shares acquired in open market
|
(6.9
|
)
|
(0.4
|
)
|
(4.9
|
)
|
|||
Acquisition of additional shares of ARX Holding Corp.
|
(11.2
|
)
|
(296.9
|
)
|
0
|
|
|||
Net proceeds from debt issuance
|
0
|
|
1,134.0
|
|
841.1
|
|
|||
Net proceeds from issuance of Serial Preferred Shares, Series B
|
0
|
|
493.9
|
|
0
|
|
|||
Payments of debt
|
0
|
|
(37.1
|
)
|
(49.0
|
)
|
|||
Proceeds from exercise of equity options
|
1.6
|
|
3.3
|
|
0.5
|
|
|||
Redemption/reacquisition of subordinated debt
|
0
|
|
0
|
|
(635.6
|
)
|
|||
Net cash provided by (used in) financing activities
|
(1,770.9
|
)
|
549.8
|
|
(300.9
|
)
|
|||
Effect of exchange rate changes on cash
|
0
|
|
0
|
|
(0.3
|
)
|
|||
Increase (decrease) in cash, cash equivalents, and restricted cash
|
152.4
|
|
(200.3
|
)
|
48.9
|
|
|||
Cash, cash equivalents, and restricted cash - beginning of year
|
75.0
|
|
275.3
|
|
226.4
|
|
|||
Cash, cash equivalents, and restricted cash - end of year
|
$
|
227.4
|
|
$
|
75.0
|
|
$
|
275.3
|
|
(millions)
|
Advertising Costs
|
|
|
2019
|
$
|
1,837.3
|
|
2018
|
1,422.4
|
|
|
2017
|
1,005.4
|
|
($ in millions)
|
2019
|
|
2018
|
|
Useful Lives
|
||
Land
|
$
|
161.6
|
|
$
|
177.0
|
|
NA
|
Buildings, improvements, and integrated components
|
927.1
|
|
928.8
|
|
7-40 years
|
||
Capitalized software
|
367.1
|
|
327.0
|
|
3-10 years
|
||
Software licenses (internal use)
|
286.8
|
|
259.1
|
|
1-5 years
|
||
Computer equipment
|
223.3
|
|
123.2
|
|
3 years
|
||
All other property and equipment
|
385.9
|
|
349.8
|
|
3-10 years
|
||
Total cost
|
2,351.8
|
|
2,164.9
|
|
|
||
Accumulated depreciation
|
(1,138.1
|
)
|
(1,033.2
|
)
|
|
||
Balance at end of year
|
$
|
1,213.7
|
|
$
|
1,131.7
|
|
|
NA = Not applicable
|
|
|
|
(millions)
|
2019
|
|
2018
|
|
2017
|
|
|||
Pretax expense
|
$
|
90.2
|
|
$
|
77.2
|
|
$
|
95.4
|
|
Tax benefit1
|
18.9
|
|
16.2
|
|
33.4
|
|
•
|
earned but unvested time-based restricted equity awards, and
|
•
|
performance-based restricted equity awards that satisfied certain contingency conditions for
|
(millions)
|
2019
|
|
2018
|
|
2017
|
|
|||
Income taxes
|
$
|
954.3
|
|
$
|
702.6
|
|
$
|
715.6
|
|
Interest
|
184.9
|
|
154.0
|
|
146.3
|
|
|||
Operating lease liabilities
|
84.0
|
|
NA
|
|
NA
|
|
($ in millions)
|
Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Net Holding Period Gains (Losses)
|
|
Fair Value
|
|
% of Total Fair Value
|
|
|||||
December 31, 2019
|
|
|
|
|
|
|
|||||||||||
Available-for-sale securities:
|
|
|
|
|
|
|
|||||||||||
Fixed maturities:
|
|
|
|
|
|
|
|||||||||||
U.S. government obligations
|
$
|
13,100.7
|
|
$
|
194.1
|
|
$
|
(43.7
|
)
|
$
|
0
|
|
$
|
13,251.1
|
|
33.7
|
%
|
State and local government obligations
|
1,686.0
|
|
30.0
|
|
(2.7
|
)
|
0
|
|
1,713.3
|
|
4.4
|
|
|||||
Corporate debt securities
|
6,860.3
|
|
206.6
|
|
(0.5
|
)
|
1.3
|
|
7,067.7
|
|
18.0
|
|
|||||
Residential mortgage-backed securities
|
625.0
|
|
4.5
|
|
(2.0
|
)
|
0
|
|
627.5
|
|
1.6
|
|
|||||
Commercial mortgage-backed securities
|
5,020.7
|
|
61.5
|
|
(6.0
|
)
|
0
|
|
5,076.2
|
|
12.9
|
|
|||||
Other asset-backed securities
|
5,164.7
|
|
16.2
|
|
(1.4
|
)
|
0
|
|
5,179.5
|
|
13.2
|
|
|||||
Redeemable preferred stocks
|
185.7
|
|
4.1
|
|
(1.3
|
)
|
6.5
|
|
195.0
|
|
0.5
|
|
|||||
Total fixed maturities
|
32,643.1
|
|
517.0
|
|
(57.6
|
)
|
7.8
|
|
33,110.3
|
|
84.3
|
|
|||||
Short-term investments
|
1,798.8
|
|
0
|
|
0
|
|
0
|
|
1,798.8
|
|
4.6
|
|
|||||
Total available-for-sale securities
|
34,441.9
|
|
517.0
|
|
(57.6
|
)
|
7.8
|
|
34,909.1
|
|
88.9
|
|
|||||
Equity securities:
|
|
|
|
|
|
|
|||||||||||
Nonredeemable preferred stocks
|
971.3
|
|
0
|
|
0
|
|
67.6
|
|
1,038.9
|
|
2.7
|
|
|||||
Common equities
|
1,125.5
|
|
0
|
|
0
|
|
2,180.8
|
|
3,306.3
|
|
8.4
|
|
|||||
Total equity securities
|
2,096.8
|
|
0
|
|
0
|
|
2,248.4
|
|
4,345.2
|
|
11.1
|
|
|||||
Total portfolio1,2
|
$
|
36,538.7
|
|
$
|
517.0
|
|
$
|
(57.6
|
)
|
$
|
2,256.2
|
|
$
|
39,254.3
|
|
100.0
|
%
|
($ in millions)
|
Cost
|
|
Gross Unrealized Gains
|
|
Gross Unrealized Losses
|
|
Net Holding Period Gains (Losses)
|
|
Fair Value
|
|
% of Total Fair Value
|
|
|||||
December 31, 2018
|
|
|
|
|
|
|
|||||||||||
Fixed maturities:
|
|
|
|
|
|
|
|||||||||||
U.S. government obligations
|
$
|
9,897.4
|
|
$
|
71.2
|
|
$
|
(52.1
|
)
|
$
|
0
|
|
$
|
9,916.5
|
|
29.5
|
%
|
State and local government obligations
|
1,654.6
|
|
7.3
|
|
(12.8
|
)
|
0
|
|
1,649.1
|
|
4.9
|
|
|||||
Corporate debt securities
|
8,808.5
|
|
13.6
|
|
(125.3
|
)
|
(2.5
|
)
|
8,694.3
|
|
25.9
|
|
|||||
Residential mortgage-backed securities
|
733.5
|
|
6.0
|
|
(5.1
|
)
|
0
|
|
734.4
|
|
2.2
|
|
|||||
Commercial mortgage-backed securities
|
3,332.8
|
|
7.8
|
|
(39.0
|
)
|
0
|
|
3,301.6
|
|
9.8
|
|
|||||
Other asset-backed securities
|
3,585.4
|
|
3.6
|
|
(11.8
|
)
|
0.1
|
|
3,577.3
|
|
10.7
|
|
|||||
Redeemable preferred stocks
|
243.7
|
|
5.9
|
|
(3.5
|
)
|
(7.8
|
)
|
238.3
|
|
0.7
|
|
|||||
Total fixed maturities
|
28,255.9
|
|
115.4
|
|
(249.6
|
)
|
(10.2
|
)
|
28,111.5
|
|
83.7
|
|
|||||
Short-term investments
|
1,795.9
|
|
0
|
|
0
|
|
0
|
|
1,795.9
|
|
5.4
|
|
|||||
Total fixed maturities and short-term
|
30,051.8
|
|
115.4
|
|
(249.6
|
)
|
(10.2
|
)
|
29,907.4
|
|
89.1
|
|
|||||
Equity securities:
|
|
|
|
|
|
|
|||||||||||
Nonredeemable preferred stocks
|
1,002.6
|
|
0
|
|
0
|
|
31.3
|
|
1,033.9
|
|
3.1
|
|
|||||
Common equities
|
1,148.9
|
|
0
|
|
0
|
|
1,477.2
|
|
2,626.1
|
|
7.8
|
|
|||||
Total equity securities
|
2,151.5
|
|
0
|
|
0
|
|
1,508.5
|
|
3,660.0
|
|
10.9
|
|
|||||
Total available-for-sale portfolio1,2
|
$
|
32,203.3
|
|
$
|
115.4
|
|
$
|
(249.6
|
)
|
$
|
1,498.3
|
|
$
|
33,567.4
|
|
100.0
|
%
|
(millions)
|
2019
|
|
|
2018
|
|
||
Fixed Maturities:
|
|
|
|
||||
State and local government obligations
|
$
|
3.5
|
|
|
$
|
3.6
|
|
Corporate debt securities
|
91.2
|
|
|
158.9
|
|
||
Other asset-backed securities
|
2.6
|
|
|
4.5
|
|
||
Redeemable preferred stocks
|
92.1
|
|
|
77.7
|
|
||
Total hybrid securities
|
$
|
189.4
|
|
|
$
|
244.7
|
|
(millions)
|
Cost
|
|
|
Fair Value
|
|
||
Less than one year
|
$
|
6,700.1
|
|
|
$
|
6,712.6
|
|
One to five years
|
16,898.3
|
|
|
17,158.4
|
|
||
Five to ten years
|
9,010.8
|
|
|
9,203.9
|
|
||
Ten years or greater
|
33.9
|
|
|
35.4
|
|
||
Total
|
$
|
32,643.1
|
|
|
$
|
33,110.3
|
|
|
Total No. of Sec.
|
|
Total
Fair
Value
|
|
Gross Unrealized Losses
|
|
Less than 12 Months
|
|
12 Months or Greater
|
||||||||||||||||
($ in millions)
|
No. of Sec.
|
|
Fair
Value
|
|
Unrealized Losses
|
|
|
No. of Sec.
|
|
Fair
Value
|
|
Unrealized Losses
|
|
||||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
U.S. government obligations
|
23
|
|
$
|
5,152.4
|
|
$
|
(43.7
|
)
|
19
|
|
$
|
5,057.2
|
|
$
|
(43.6
|
)
|
|
4
|
|
$
|
95.2
|
|
$
|
(0.1
|
)
|
State and local government obligations
|
67
|
|
314.3
|
|
(2.7
|
)
|
52
|
|
287.5
|
|
(2.6
|
)
|
|
15
|
|
26.8
|
|
(0.1
|
)
|
||||||
Corporate debt securities
|
16
|
|
247.6
|
|
(0.5
|
)
|
12
|
|
191.4
|
|
(0.5
|
)
|
|
4
|
|
56.2
|
|
0
|
|
||||||
Residential mortgage-backed securities
|
41
|
|
292.8
|
|
(2.0
|
)
|
12
|
|
163.7
|
|
(0.9
|
)
|
|
29
|
|
129.1
|
|
(1.1
|
)
|
||||||
Commercial mortgage-backed securities
|
98
|
|
1,742.4
|
|
(6.0
|
)
|
79
|
|
1,400.0
|
|
(5.3
|
)
|
|
19
|
|
342.4
|
|
(0.7
|
)
|
||||||
Other asset-backed securities
|
61
|
|
1,000.6
|
|
(1.4
|
)
|
43
|
|
938.5
|
|
(0.9
|
)
|
|
18
|
|
62.1
|
|
(0.5
|
)
|
||||||
Redeemable preferred stocks
|
1
|
|
11.2
|
|
(1.3
|
)
|
0
|
|
0
|
|
0
|
|
|
1
|
|
11.2
|
|
(1.3
|
)
|
||||||
Total fixed maturities
|
307
|
|
$
|
8,761.3
|
|
$
|
(57.6
|
)
|
217
|
|
$
|
8,038.3
|
|
$
|
(53.8
|
)
|
|
90
|
|
$
|
723.0
|
|
$
|
(3.8
|
)
|
|
Total No. of Sec.
|
|
Total
Fair
Value
|
|
Gross
Unrealized
Losses
|
|
Less than 12 Months
|
|
12 Months or Greater
|
||||||||||||||||
($ in millions)
|
No. of Sec.
|
|
Fair
Value
|
|
Unrealized
Losses
|
|
|
No. of Sec.
|
|
Fair
Value
|
|
Unrealized
Losses
|
|
||||||||||||
December 31, 2018
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
U.S. government obligations
|
51
|
|
$
|
4,438.0
|
|
$
|
(52.1
|
)
|
2
|
|
$
|
126.6
|
|
$
|
(0.1
|
)
|
|
49
|
|
$
|
4,311.4
|
|
$
|
(52.0
|
)
|
State and local government obligations
|
299
|
|
972.4
|
|
(12.8
|
)
|
49
|
|
192.7
|
|
(0.3
|
)
|
|
250
|
|
779.7
|
|
(12.5
|
)
|
||||||
Corporate debt securities
|
368
|
|
6,723.3
|
|
(125.3
|
)
|
133
|
|
2,613.3
|
|
(33.4
|
)
|
|
235
|
|
4,110.0
|
|
(91.9
|
)
|
||||||
Residential mortgage-backed securities
|
228
|
|
450.2
|
|
(5.1
|
)
|
32
|
|
248.8
|
|
(0.8
|
)
|
|
196
|
|
201.4
|
|
(4.3
|
)
|
||||||
Commercial mortgage-backed securities
|
140
|
|
2,328.5
|
|
(39.0
|
)
|
48
|
|
741.2
|
|
(8.9
|
)
|
|
92
|
|
1,587.3
|
|
(30.1
|
)
|
||||||
Other asset-backed securities
|
203
|
|
2,691.3
|
|
(11.8
|
)
|
84
|
|
1,551.7
|
|
(3.2
|
)
|
|
119
|
|
1,139.6
|
|
(8.6
|
)
|
||||||
Redeemable preferred stocks
|
3
|
|
48.5
|
|
(3.5
|
)
|
1
|
|
18.9
|
|
(0.6
|
)
|
|
2
|
|
29.6
|
|
(2.9
|
)
|
||||||
Total fixed maturities
|
1,292
|
|
$
|
17,652.2
|
|
$
|
(249.6
|
)
|
349
|
|
$
|
5,493.2
|
|
$
|
(47.3
|
)
|
|
943
|
|
$
|
12,159.0
|
|
$
|
(202.3
|
)
|
(millions)
|
Total
|
|
|
Total at December 31, 2016
|
$
|
11.5
|
|
Credit losses for which an OTTI was not previously recognized
|
0.4
|
|
|
Reductions for securities sold/matured
|
(11.2
|
)
|
|
Change in recoveries of future cash flows expected to be collected1
|
(0.2
|
)
|
|
Total at December 31, 2017
|
$
|
0.5
|
|
(millions)
|
2019
|
|
2018
|
|
2017
|
|
|||
Gross realized gains on security sales
|
|
|
|
||||||
Available-for-sale securities:
|
|
|
|
||||||
U.S. government obligations
|
$
|
164.4
|
|
$
|
6.7
|
|
$
|
6.2
|
|
State and local government obligations
|
6.1
|
|
9.5
|
|
10.5
|
|
|||
Corporate and other debt securities
|
100.1
|
|
2.4
|
|
20.3
|
|
|||
Residential mortgage-backed securities
|
0.2
|
|
0
|
|
23.8
|
|
|||
Commercial mortgage-backed securities
|
8.1
|
|
2.0
|
|
4.9
|
|
|||
Other asset-backed securities
|
0.8
|
|
0.1
|
|
0.3
|
|
|||
Redeemable preferred stocks
|
2.2
|
|
4.5
|
|
8.5
|
|
|||
Total available-for-sale securities
|
281.9
|
|
25.2
|
|
74.5
|
|
|||
Equity securities:
|
|
|
|
||||||
Nonredeemable preferred stocks
|
36.2
|
|
4.1
|
|
58.4
|
|
|||
Common equities
|
61.7
|
|
286.6
|
|
43.0
|
|
|||
Total equity securities
|
97.9
|
|
290.7
|
|
101.4
|
|
|||
Subtotal gross realized gains on security sales
|
379.8
|
|
315.9
|
|
175.9
|
|
|||
Gross realized losses on security sales
|
|
|
|
||||||
Available-for-sale securities:
|
|
|
|
||||||
U.S. government obligations
|
(20.4
|
)
|
(98.7
|
)
|
(28.7
|
)
|
|||
State and local government obligations
|
(0.7
|
)
|
(2.9
|
)
|
(0.1
|
)
|
|||
Corporate and other debt securities
|
(7.9
|
)
|
(10.4
|
)
|
(5.1
|
)
|
|||
Residential mortgage-backed securities
|
(2.3
|
)
|
(0.1
|
)
|
(0.4
|
)
|
|||
Commercial mortgage-backed securities
|
(2.2
|
)
|
(6.3
|
)
|
(5.3
|
)
|
|||
Other asset-backed securities
|
(0.1
|
)
|
(1.1
|
)
|
(0.4
|
)
|
|||
Redeemable preferred stocks
|
(0.4
|
)
|
(0.1
|
)
|
(6.4
|
)
|
|||
Short-term investments
|
0
|
|
0
|
|
(0.2
|
)
|
|||
Total available-for-sale securities
|
(34.0
|
)
|
(119.6
|
)
|
(46.6
|
)
|
|||
Equity securities:
|
|
|
|
||||||
Nonredeemable preferred stocks
|
(3.2
|
)
|
(3.9
|
)
|
(5.9
|
)
|
|||
Common equities
|
(8.0
|
)
|
(21.7
|
)
|
(12.2
|
)
|
|||
Total equity securities
|
(11.2
|
)
|
(25.6
|
)
|
(18.1
|
)
|
|||
Subtotal gross realized losses on security sales
|
(45.2
|
)
|
(145.2
|
)
|
(64.7
|
)
|
|||
Net realized gains (losses) on security sales
|
|
|
|
||||||
Available-for-sale securities:
|
|
|
|
||||||
U.S. government obligations
|
144.0
|
|
(92.0
|
)
|
(22.5
|
)
|
|||
State and local government obligations
|
5.4
|
|
6.6
|
|
10.4
|
|
|||
Corporate and other debt securities
|
92.2
|
|
(8.0
|
)
|
15.2
|
|
|||
Residential mortgage-backed securities
|
(2.1
|
)
|
(0.1
|
)
|
23.4
|
|
|||
Commercial mortgage-backed securities
|
5.9
|
|
(4.3
|
)
|
(0.4
|
)
|
|||
Other asset-backed securities
|
0.7
|
|
(1.0
|
)
|
(0.1
|
)
|
|||
Redeemable preferred stocks
|
1.8
|
|
4.4
|
|
2.1
|
|
|||
Short-term investments
|
0
|
|
0
|
|
(0.2
|
)
|
|||
Total available-for-sale securities
|
247.9
|
|
(94.4
|
)
|
27.9
|
|
|||
Equity securities:
|
|
|
|
||||||
Nonredeemable preferred stocks
|
33.0
|
|
0.2
|
|
52.5
|
|
|||
Common equities
|
53.7
|
|
264.9
|
|
30.8
|
|
|||
Total equity securities
|
86.7
|
|
265.1
|
|
83.3
|
|
|||
Litigation settlements and other gains (losses)
|
0
|
|
0
|
|
1.2
|
|
|||
Subtotal net realized gains (losses) on security sales
|
334.6
|
|
170.7
|
|
112.4
|
|
|||
Net holding period gains (losses)
|
|
|
|
||||||
Hybrid securities
|
18.0
|
|
(10.4
|
)
|
(1.6
|
)
|
|||
Equity securities
|
739.9
|
|
(497.5
|
)
|
0
|
|
|||
Subtotal net holding period gains (losses)
|
757.9
|
|
(507.9
|
)
|
(1.6
|
)
|
|||
Other-than-temporary impairment losses
|
|
|
|
||||||
Fixed maturities:
|
|
|
|
||||||
Commercial mortgage-backed securities
|
0
|
|
0
|
|
(0.4
|
)
|
|||
Total fixed maturities
|
0
|
|
0
|
|
(0.4
|
)
|
|||
Equity securities:
|
|
|
|
||||||
Common equities
|
0
|
|
0
|
|
(11.2
|
)
|
|||
Subtotal investment other-than-temporary impairment losses
|
0
|
|
0
|
|
(11.6
|
)
|
|||
Other asset impairment
|
(63.3
|
)
|
(68.3
|
)
|
(49.6
|
)
|
|||
Subtotal other-than-temporary impairment losses
|
(63.3
|
)
|
(68.3
|
)
|
(61.2
|
)
|
|||
Total net realized gains (losses) on securities
|
$
|
1,029.2
|
|
$
|
(405.5
|
)
|
$
|
49.6
|
|
(millions)
|
2019
|
|
2018
|
|
||
Total net gains (losses) recognized during the period on equity securities
|
$
|
826.6
|
|
$
|
(232.4
|
)
|
Less: Net gains (losses) recognized on equity securities sold during the period
|
86.7
|
|
265.1
|
|
||
Net holding period gains (losses) recognized during the period on equity securities held at period end
|
$
|
739.9
|
|
$
|
(497.5
|
)
|
(millions)
|
2019
|
|
2018
|
|
2017
|
|
|||
Available-for-sale securities:
|
|
|
|
||||||
Fixed maturities:
|
|
|
|
||||||
U.S. government obligations
|
$
|
268.6
|
|
$
|
196.8
|
|
$
|
72.7
|
|
State and local government obligations
|
36.5
|
|
37.7
|
|
51.5
|
|
|||
Foreign government obligations
|
0
|
|
0
|
|
0.3
|
|
|||
Corporate debt securities
|
268.9
|
|
217.9
|
|
125.2
|
|
|||
Residential mortgage-backed securities
|
21.6
|
|
27.6
|
|
34.7
|
|
|||
Commercial mortgage-backed securities
|
150.1
|
|
93.9
|
|
79.6
|
|
|||
Other asset-backed securities
|
117.3
|
|
75.7
|
|
47.1
|
|
|||
Redeemable preferred stocks
|
19.0
|
|
12.3
|
|
11.8
|
|
|||
Total fixed maturities
|
882.0
|
|
661.9
|
|
422.9
|
|
|||
Short-term investments
|
41.7
|
|
52.9
|
|
37.8
|
|
|||
Total available-for-sale securities
|
923.7
|
|
714.8
|
|
460.7
|
|
|||
Equity securities:
|
|
|
|
||||||
Nonredeemable preferred stocks
|
61.8
|
|
45.9
|
|
44.1
|
|
|||
Common equities
|
56.5
|
|
59.8
|
|
58.3
|
|
|||
Total equity securities
|
118.3
|
|
105.7
|
|
102.4
|
|
|||
Investment income
|
1,042.0
|
|
820.5
|
|
563.1
|
|
|||
Investment expenses
|
(24.6
|
)
|
(24.3
|
)
|
(23.9
|
)
|
|||
Net investment income
|
$
|
1,017.4
|
|
$
|
796.2
|
|
$
|
539.2
|
|
•
|
Level 1: Inputs are unadjusted, quoted prices in active markets for identical instruments at the measurement date (e.g., U.S. government obligations, which are continually priced on a daily basis, active exchange-traded equity securities, and certain short-term securities).
|
•
|
Level 2: Inputs (other than quoted prices included within Level 1) that are observable for the instrument either directly or indirectly (e.g., certain corporate and municipal bonds and certain preferred stocks). This includes: (i) quoted prices for similar instruments in active markets, (ii) quoted prices for identical or similar instruments in markets that are not active, (iii) inputs other than quoted prices that are
|
•
|
Level 3: Inputs that are unobservable. Unobservable inputs reflect our subjective evaluation about the assumptions market participants would use in pricing the financial instrument (e.g., certain structured securities and privately held investments).
|
|
Fair Value
|
|
|||||||||||||
(millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Cost
|
|
|||||
December 31, 2019
|
|
|
|
|
|
||||||||||
Fixed maturities:
|
|
|
|
|
|
||||||||||
U.S. government obligations
|
$
|
13,251.1
|
|
$
|
0
|
|
$
|
0
|
|
$
|
13,251.1
|
|
$
|
13,100.7
|
|
State and local government obligations
|
0
|
|
1,713.3
|
|
0
|
|
1,713.3
|
|
1,686.0
|
|
|||||
Corporate debt securities
|
0
|
|
7,067.7
|
|
0
|
|
7,067.7
|
|
6,860.3
|
|
|||||
Subtotal
|
13,251.1
|
|
8,781.0
|
|
0
|
|
22,032.1
|
|
21,647.0
|
|
|||||
Asset-backed securities:
|
|
|
|
|
|
||||||||||
Residential mortgage-backed
|
0
|
|
627.5
|
|
0
|
|
627.5
|
|
625.0
|
|
|||||
Commercial mortgage-backed
|
0
|
|
5,076.2
|
|
0
|
|
5,076.2
|
|
5,020.7
|
|
|||||
Other asset-backed
|
0
|
|
5,179.5
|
|
0
|
|
5,179.5
|
|
5,164.7
|
|
|||||
Subtotal asset-backed securities
|
0
|
|
10,883.2
|
|
0
|
|
10,883.2
|
|
10,810.4
|
|
|||||
Redeemable preferred stocks:
|
|
|
|
|
|
||||||||||
Financials
|
0
|
|
51.7
|
|
0
|
|
51.7
|
|
51.5
|
|
|||||
Utilities
|
0
|
|
11.1
|
|
0
|
|
11.1
|
|
10.0
|
|
|||||
Industrials
|
11.1
|
|
121.1
|
|
0
|
|
132.2
|
|
124.2
|
|
|||||
Subtotal redeemable preferred stocks
|
11.1
|
|
183.9
|
|
0
|
|
195.0
|
|
185.7
|
|
|||||
Total fixed maturities
|
13,262.2
|
|
19,848.1
|
|
0
|
|
33,110.3
|
|
32,643.1
|
|
|||||
Short-term investments
|
1,797.4
|
|
1.4
|
|
0
|
|
1,798.8
|
|
1,798.8
|
|
|||||
Total available-for-sale securities
|
15,059.6
|
|
19,849.5
|
|
0
|
|
34,909.1
|
|
34,441.9
|
|
|||||
Equity securities:
|
|
|
|
|
|
||||||||||
Nonredeemable preferred stocks:
|
|
|
|
|
|
||||||||||
Financials
|
77.4
|
|
850.7
|
|
27.1
|
|
955.2
|
|
891.3
|
|
|||||
Utilities
|
0
|
|
42.3
|
|
0
|
|
42.3
|
|
39.9
|
|
|||||
Industrials
|
0
|
|
25.4
|
|
16.0
|
|
41.4
|
|
40.1
|
|
|||||
Subtotal nonredeemable preferred stocks
|
77.4
|
|
918.4
|
|
43.1
|
|
1,038.9
|
|
971.3
|
|
|||||
Common equities:
|
|
|
|
|
|
||||||||||
Common stocks
|
3,306.0
|
|
0
|
|
0
|
|
3,306.0
|
|
1,125.2
|
|
|||||
Other risk investments
|
0
|
|
0
|
|
0.3
|
|
0.3
|
|
0.3
|
|
|||||
Subtotal common equities
|
3,306.0
|
|
0
|
|
0.3
|
|
3,306.3
|
|
1,125.5
|
|
|||||
Total equity securities
|
3,383.4
|
|
918.4
|
|
43.4
|
|
4,345.2
|
|
2,096.8
|
|
|||||
Total portfolio
|
$
|
18,443.0
|
|
$
|
20,767.9
|
|
$
|
43.4
|
|
$
|
39,254.3
|
|
$
|
36,538.7
|
|
Debt
|
$
|
0
|
|
$
|
5,119.6
|
|
$
|
0
|
|
$
|
5,119.6
|
|
$
|
4,407.1
|
|
|
Fair Value
|
|
|||||||||||||
(millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Cost
|
|
|||||
December 31, 2018
|
|
|
|
|
|
||||||||||
Fixed maturities:
|
|
|
|
|
|
||||||||||
U.S. government obligations
|
$
|
9,916.5
|
|
$
|
0
|
|
$
|
0
|
|
$
|
9,916.5
|
|
$
|
9,897.4
|
|
State and local government obligations
|
0
|
|
1,649.1
|
|
0
|
|
1,649.1
|
|
1,654.6
|
|
|||||
Corporate debt securities
|
0
|
|
8,694.3
|
|
0
|
|
8,694.3
|
|
8,808.5
|
|
|||||
Subtotal
|
9,916.5
|
|
10,343.4
|
|
0
|
|
20,259.9
|
|
20,360.5
|
|
|||||
Asset-backed securities:
|
|
|
|
|
|
||||||||||
Residential mortgage-backed
|
0
|
|
734.4
|
|
0
|
|
734.4
|
|
733.5
|
|
|||||
Commercial mortgage-backed
|
0
|
|
3,301.6
|
|
0
|
|
3,301.6
|
|
3,332.8
|
|
|||||
Other asset-backed
|
0
|
|
3,577.3
|
|
0
|
|
3,577.3
|
|
3,585.4
|
|
|||||
Subtotal asset-backed securities
|
0
|
|
7,613.3
|
|
0
|
|
7,613.3
|
|
7,651.7
|
|
|||||
Redeemable preferred stocks:
|
|
|
|
|
|
||||||||||
Financials
|
0
|
|
78.2
|
|
0
|
|
78.2
|
|
79.3
|
|
|||||
Utilities
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
|||||
Industrials
|
9.5
|
|
150.6
|
|
0
|
|
160.1
|
|
164.4
|
|
|||||
Subtotal redeemable preferred stocks
|
9.5
|
|
228.8
|
|
0
|
|
238.3
|
|
243.7
|
|
|||||
Total fixed maturities
|
9,926.0
|
|
18,185.5
|
|
0
|
|
28,111.5
|
|
28,255.9
|
|
|||||
Short-term investments
|
1,722.1
|
|
73.8
|
|
0
|
|
1,795.9
|
|
1,795.9
|
|
|||||
Total fixed maturities and short-term
|
11,648.1
|
|
18,259.3
|
|
0
|
|
29,907.4
|
|
30,051.8
|
|
|||||
Equity securities:
|
|
|
|
|
|
||||||||||
Nonredeemable preferred stocks:
|
|
|
|
|
|
||||||||||
Financials
|
71.9
|
|
887.1
|
|
25.1
|
|
984.1
|
|
951.6
|
|
|||||
Utilities
|
0
|
|
44.8
|
|
0
|
|
44.8
|
|
46.0
|
|
|||||
Industrials
|
0
|
|
0
|
|
5.0
|
|
5.0
|
|
5.0
|
|
|||||
Subtotal nonredeemable preferred stocks
|
71.9
|
|
931.9
|
|
30.1
|
|
1,033.9
|
|
1,002.6
|
|
|||||
Common equities:
|
|
|
|
|
|
||||||||||
Common stocks
|
2,625.8
|
|
0
|
|
0
|
|
2,625.8
|
|
1,148.6
|
|
|||||
Other risk investments
|
0
|
|
0
|
|
0.3
|
|
0.3
|
|
0.3
|
|
|||||
Subtotal common equities
|
2,625.8
|
|
0
|
|
0.3
|
|
2,626.1
|
|
1,148.9
|
|
|||||
Total equity securities
|
2,697.7
|
|
931.9
|
|
30.4
|
|
3,660.0
|
|
2,151.5
|
|
|||||
Total available-for-sale portfolio
|
$
|
14,345.8
|
|
$
|
19,191.2
|
|
$
|
30.4
|
|
$
|
33,567.4
|
|
$
|
32,203.3
|
|
Debt
|
$
|
0
|
|
$
|
4,532.3
|
|
$
|
0
|
|
$
|
4,532.3
|
|
$
|
4,404.9
|
|
|
Level 3 Fair Value
|
|||||||||||||||||||||||
(millions)
|
Fair Value at Dec. 31, 2018
|
|
Calls/
Maturities/
Paydowns
|
|
Purchases
|
|
Sales
|
|
Net Realized
(Gain)/Loss
on Sales
|
|
Change in
Valuation
|
|
Net
Transfers
In (Out)
|
|
Fair Value at Dec. 31, 2019
|
|
||||||||
Equity securities:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Nonredeemable preferred stocks:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financials
|
$
|
25.1
|
|
$
|
0
|
|
$
|
2.0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
27.1
|
|
Industrials
|
5.0
|
|
0
|
|
10.0
|
|
0
|
|
0
|
|
1.0
|
|
0
|
|
16.0
|
|
||||||||
Common equities:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other risk investments
|
0.3
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0.3
|
|
||||||||
Total Level 3 securities
|
$
|
30.4
|
|
$
|
0
|
|
$
|
12.0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
1.0
|
|
$
|
0
|
|
$
|
43.4
|
|
|
Level 3 Fair Value
|
|||||||||||||||||||||||
(millions)
|
Fair Value at Dec. 31, 2017
|
|
Calls/
Maturities/
Paydowns
|
|
Purchases
|
|
Sales
|
|
Net Realized
(Gain)/Loss
on Sales
|
|
Change in
Valuation
|
|
Net
Transfers
In (Out)
|
|
Fair Value at Dec. 31, 2018
|
|
||||||||
Equity securities:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Nonredeemable preferred stocks:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Financials
|
$
|
0
|
|
$
|
0
|
|
$
|
25.1
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
25.1
|
|
Industrials
|
5.0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
5.0
|
|
||||||||
Common equities:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Other risk investments
|
0.3
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0.3
|
|
||||||||
Total Level 3 securities
|
$
|
5.3
|
|
$
|
0
|
|
$
|
25.1
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
30.4
|
|
|
Quantitative Information about Level 3 Fair Value Measurements
|
||||||
($ in millions)
|
Fair Value at Dec. 31, 2019
|
|
Valuation Technique
|
Unobservable Input
|
Unobservable Input Assumption
|
|
|
Equity securities:
|
|
|
|
|
|||
Nonredeemable preferred stocks:
|
|
|
|
|
|||
Financials
|
$
|
27.1
|
|
Pricing firm
|
Recent transaction price
|
9.0
|
|
Industrials
|
6.0
|
|
Pricing firm
|
Performance-based transaction price adjustment
|
4.8
|
|
|
Industrials1
|
10.0
|
|
Internal price
|
Unadjusted purchase price
|
4.9
|
|
|
Subtotal Level 3 securities
|
43.1
|
|
|
|
|
||
Pricing exemption securities
|
0.3
|
|
|
|
|
||
Total Level 3 securities
|
$
|
43.4
|
|
|
|
|
|
Quantitative Information about Level 3 Fair Value Measurements
|
||||||
($ in millions)
|
Fair Value at Dec. 31, 2018
|
|
Valuation Technique
|
Unobservable Input
|
Unobservable Input Assumption
|
|
|
Equity securities:
|
|
|
|
|
|||
Nonredeemable preferred stocks:
|
|
|
|
|
|||
Financials1
|
$
|
25.1
|
|
Internal price
|
Unadjusted purchase price
|
9.0
|
|
Industrials
|
5.0
|
|
Internal price
|
Price-to-sales ratio
|
5.5
|
|
|
Subtotal Level 3 securities
|
30.1
|
|
|
|
|
||
Pricing exemption securities
|
0.3
|
|
|
|
|
||
Total Level 3 securities
|
$
|
30.4
|
|
|
|
|
|
|
|
2019
|
|
2018
|
||||||||||||
(millions)
|
|
|
Carrying
Value
|
|
|
Fair
Value
|
|
|
Carrying
Value
|
|
|
Fair
Value
|
|
||||
3.75% Senior Notes due 2021 (issued: $500.0, August 2011)
|
$
|
499.4
|
|
|
$
|
515.6
|
|
|
$
|
499.1
|
|
|
$
|
506.5
|
|
||
2.45% Senior Notes due 2027 (issued: $500.0, August 2016)
|
496.9
|
|
|
501.5
|
|
|
496.5
|
|
|
455.5
|
|
||||||
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999)
|
296.6
|
|
|
392.5
|
|
|
296.4
|
|
|
368.5
|
|
||||||
4.00% Senior Notes due 2029 (issued: $550.0, October 2018)
|
545.0
|
|
|
614.3
|
|
|
544.5
|
|
|
562.4
|
|
||||||
6.25% Senior Notes due 2032 (issued: $400.0, November 2002)
|
395.7
|
|
|
552.6
|
|
|
395.5
|
|
|
496.6
|
|
||||||
4.35% Senior Notes due 2044 (issued: $350.0, April 2014)
|
346.7
|
|
|
417.0
|
|
|
346.6
|
|
|
350.2
|
|
||||||
3.70% Senior Notes due 2045 (issued: $400.0, January 2015)
|
395.4
|
|
|
434.2
|
|
|
395.3
|
|
|
366.7
|
|
||||||
4.125% Senior Notes due 2047 (issued: $850.0, April 2017)
|
841.6
|
|
|
986.1
|
|
|
841.4
|
|
|
831.9
|
|
||||||
4.20% Senior Notes due 2048 (issued: $600.0, March 2018)
|
589.8
|
|
|
705.8
|
|
|
589.6
|
|
|
594.0
|
|
||||||
Total
|
$
|
4,407.1
|
|
|
$
|
5,119.6
|
|
|
$
|
4,404.9
|
|
|
$
|
4,532.3
|
|
(millions)
|
Unrealized
Gain (Loss)
at Debt Issuance
|
|
Unamortized
Balance at
December 31, 2019
|
|
||
3.75% Senior Notes
|
$
|
(5.1
|
)
|
$
|
(1.0
|
)
|
6 5/8% Senior Notes
|
(4.2
|
)
|
(2.4
|
)
|
||
6.25% Senior Notes
|
5.1
|
|
3.3
|
|
||
4.35% Senior Notes
|
(1.6
|
)
|
(1.4
|
)
|
||
3.70% Senior Notes
|
(12.9
|
)
|
(11.7
|
)
|
||
4.125% Senior Notes
|
(8.0
|
)
|
(7.6
|
)
|
(millions)
|
2019
|
2018
|
2017
|
||||||
Current tax provision
|
|
|
|
|
|
|
|||
Federal
|
$
|
1,104.7
|
|
$
|
673.1
|
|
$
|
680.9
|
|
State
|
27.3
|
|
21.5
|
|
12.8
|
|
|||
Deferred tax expense (benefit)
|
|
|
|
|
|
|
|||
Federal
|
45.3
|
|
(145.9
|
)
|
(149.4
|
)
|
|||
State
|
3.0
|
|
(6.1
|
)
|
(3.5
|
)
|
|||
Total income tax provision
|
$
|
1,180.3
|
|
$
|
542.6
|
|
$
|
540.8
|
|
(millions)
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Income before income taxes
|
$
|
5,160.3
|
|
|
|
$
|
3,163.6
|
|
|
|
$
|
2,138.9
|
|
|
|||
Tax at statutory federal rate
|
$
|
1,083.7
|
|
21
|
%
|
|
$
|
664.4
|
|
21
|
%
|
|
$
|
748.6
|
|
35
|
%
|
Tax effect of:
|
|
|
|
|
|
|
|
|
|||||||||
Reversal of prior year tax credits
|
163.2
|
|
3
|
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
|||
Tax credits1
|
(43.9
|
)
|
(1
|
)
|
|
(76.3
|
)
|
(2
|
)
|
|
(52.4
|
)
|
(2
|
)
|
|||
Stock-based compensation
|
(25.9
|
)
|
(1
|
)
|
|
(25.1
|
)
|
(1
|
)
|
|
(25.1
|
)
|
(1
|
)
|
|||
Tax-deductible dividends
|
(14.6
|
)
|
0
|
|
|
(14.6
|
)
|
(1
|
)
|
|
(9.7
|
)
|
0
|
|
|||
Dividends received deduction2,3
|
(10.4
|
)
|
0
|
|
|
(9.7
|
)
|
0
|
|
|
(20.7
|
)
|
(1
|
)
|
|||
Exempt interest income3
|
(3.6
|
)
|
0
|
|
|
(5.9
|
)
|
0
|
|
|
(16.9
|
)
|
(1
|
)
|
|||
Net deferred tax liability revaluation4
|
0
|
|
0
|
|
|
0
|
|
0
|
|
|
(99.5
|
)
|
(5
|
)
|
|||
Nondeductible compensation expense5
|
8.1
|
|
0
|
|
|
(0.2
|
)
|
0
|
|
|
10.1
|
|
0
|
|
|||
State income taxes, net of federal taxes
|
24.0
|
|
1
|
|
|
12.2
|
|
0
|
|
|
6.0
|
|
0
|
|
|||
Other items, net
|
(0.3
|
)
|
0
|
|
|
(2.2
|
)
|
0
|
|
|
0.4
|
|
0
|
|
|||
Total income tax provision
|
$
|
1,180.3
|
|
23
|
%
|
|
$
|
542.6
|
|
17
|
%
|
|
$
|
540.8
|
|
25
|
%
|
•
|
We reversed $3.9 million of the $4.5 million provisional tax amount that we recorded in 2017 related to deductibility of compensation expense for certain covered executives due to uncertainty surrounding the appropriate tax treatment of outstanding performance-based awards at that time. The IRS issued additional guidance during 2018 that clarified the treatment of these awards. We also recorded a benefit of $0.3 million in 2018 related to compensation expense for time-based awards
|
•
|
We recorded an increase to the deferred tax asset for loss and loss adjustment expense reserves of $67.1 million and an offsetting deferred tax liability in the same amount for the transition adjustment, which is recognized over an 8-year period as required by the 2017 Tax Act. At December 31, 2017, we did not record any amounts related to the changes in loss reserve discounting required by the 2017 Tax Act since the IRS had not yet published new discount factors based on loss payment patterns and interest rates determined under the 2017 Tax Act and we were unable to make a reasonable estimate. The IRS published the new discount factors in 2018, which allowed us to compute the adjustments. The impact of these amounts are reflected in the 2018 deferred tax assets and liabilities in the table below.
|
(millions)
|
2019
|
2018
|
||||
Federal deferred tax assets:
|
|
|
||||
Unearned premiums reserve
|
$
|
498.2
|
|
$
|
439.9
|
|
Non-deductible accruals
|
181.8
|
|
169.3
|
|
||
Loss and loss adjustment expense reserves
|
153.3
|
|
134.6
|
|
||
Operating lease liabilities
|
42.3
|
|
0
|
|
||
Net unrealized losses on fixed-maturity securities
|
0
|
|
28.2
|
|
||
Hedges on forecasted transactions
|
4.4
|
|
4.6
|
|
||
Other
|
15.3
|
|
16.2
|
|
||
Federal deferred tax liabilities:
|
|
|
||||
Net holding period gains on equity securities
|
(472.2
|
)
|
(316.8
|
)
|
||
Deferred acquisition costs
|
(221.9
|
)
|
(199.8
|
)
|
||
Property and equipment
|
(108.6
|
)
|
(85.7
|
)
|
||
Net unrealized gains on fixed-maturity securities
|
(96.5
|
)
|
0
|
|
||
Loss and loss adjustment expense reserve transition adjustment
|
(47.2
|
)
|
(58.5
|
)
|
||
Operating lease assets
|
(42.3
|
)
|
0
|
|
||
Intangible assets
|
(38.9
|
)
|
(52.2
|
)
|
||
Investment basis differences
|
(1.1
|
)
|
(43.3
|
)
|
||
Prepaid expenses
|
(4.8
|
)
|
(4.7
|
)
|
||
Other
|
(8.3
|
)
|
(8.9
|
)
|
||
Net federal deferred tax asset (liability)
|
(146.5
|
)
|
22.9
|
|
||
Net state deferred tax asset
|
14.0
|
|
20.3
|
|
||
Net deferred tax asset (liability)
|
$
|
(132.5
|
)
|
$
|
43.2
|
|
(millions)
|
2019
|
2018
|
2017
|
||||||
Balance at January 1
|
$
|
15,400.8
|
|
$
|
13,086.9
|
|
$
|
11,368.0
|
|
Less reinsurance recoverables on unpaid losses
|
2,572.7
|
|
2,170.1
|
|
1,801.0
|
|
|||
Net balance at January 1
|
12,828.1
|
|
10,916.8
|
|
9,567.0
|
|
|||
Incurred related to:
|
|
|
|
||||||
Current year
|
25,238.2
|
|
21,632.5
|
|
18,782.1
|
|
|||
Prior years
|
232.3
|
|
88.5
|
|
25.9
|
|
|||
Total incurred
|
25,470.5
|
|
21,721.0
|
|
18,808.0
|
|
|||
Paid related to:
|
|
|
|
||||||
Current year
|
16,105.0
|
|
13,792.1
|
|
12,201.5
|
|
|||
Prior years
|
7,300.4
|
|
6,017.6
|
|
5,256.7
|
|
|||
Total paid
|
23,405.4
|
|
19,809.7
|
|
17,458.2
|
|
|||
Net balance at December 31
|
14,893.2
|
|
12,828.1
|
|
10,916.8
|
|
|||
Plus reinsurance recoverables on unpaid losses
|
3,212.2
|
|
2,572.7
|
|
2,170.1
|
|
|||
Balance at December 31
|
$
|
18,105.4
|
|
$
|
15,400.8
|
|
$
|
13,086.9
|
|
•
|
Approximately $131 million of the unfavorable prior year reserve development was attributable to accident year 2018, $73 million to accident year 2017, and the remainder to 2016 and prior accident years.
|
•
|
Our personal auto products incurred about $121 million of unfavorable loss and LAE reserve development, with the Agency and Direct auto businesses each contributing about half, primarily reflecting increased injury severity, a higher than anticipated frequency of reopened personal injury protection (PIP) claims, primarily in Florida, and late reported losses occurring late 2018 but not reported until 2019.
|
•
|
Our Commercial Lines business experienced about $83 million of unfavorable development, primarily due to increased injury severity and more emergence of large injury claims than originally anticipated.
|
•
|
Our special lines business experienced about $14 million of unfavorable development, primarily due to less salvage and subrogation recoveries than originally anticipated and increased severity of late reported claims.
|
•
|
Our Property businesses experienced about $12 million of unfavorable development, primarily due to higher than originally anticipated homeowner and dwelling costs and fire liability costs.
|
•
|
Approximately $99 million of unfavorable prior year reserve development was attributable to accident years 2017 and 2016. This unfavorable development was offset by about $10 million of favorable development attributable to accident year 2015 and prior accident years.
|
•
|
Our personal auto products incurred almost $85 million of unfavorable loss and LAE reserve development, with approximately 70% attributable to the Agency business and 30% attributable to the Direct business, primarily reflecting unfavorable development from reopened Florida PIP claims.
|
•
|
Our special lines and Property businesses experienced about $5 million and $3 million of unfavorable development, respectively, while our commercial auto products had about $4 million of favorable reserve development.
|
•
|
Approximately $64 million of unfavorable prior year reserve development was attributable to accident years 2016 and 2015. This unfavorable development was offset by $38 million of favorable development attributable to accident year 2014 and prior accident years.
|
•
|
Our personal auto products incurred $70 million of unfavorable loss and LAE reserve development, primarily in the Agency business, in part reflecting an increase in costs related to property damage and higher LAE costs, primarily due to an increase in incentive compensation and defense counsel spend.
|
•
|
Our Property business experienced $37 million in favorable development primarily due to lower severity and frequency than anticipated for accident year 2016 and development of losses eligible to be ceded under our catastrophe bond reinsurance program.
|
•
|
Our commercial auto products had less than $1 million of unfavorable reserve development.
|
Personal Lines - Agency - Liability
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
3,774.9
|
|
|
$
|
3,773.8
|
|
|
$
|
3,798.8
|
|
|
$
|
3,815.6
|
|
|
$
|
3,776.0
|
|
|
$
|
0
|
|
|
704,986
|
|
2016
|
|
|
|
4,082.9
|
|
|
4,130.0
|
|
|
4,152.0
|
|
|
4,177.3
|
|
|
62.3
|
|
|
740,385
|
|
|||||||
2017
|
|
|
|
|
|
4,474.8
|
|
|
4,485.8
|
|
|
4,511.1
|
|
|
82.5
|
|
|
779,082
|
|
||||||||
2018
|
|
|
|
|
|
|
|
5,141.8
|
|
|
5,182.1
|
|
|
224.2
|
|
|
854,146
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
5,885.0
|
|
|
871.8
|
|
|
909,050
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
23,531.5
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
1,793.1
|
|
|
$
|
2,976.0
|
|
|
$
|
3,416.5
|
|
|
$
|
3,623.3
|
|
|
$
|
3,715.4
|
|
|
|
|
|
|||
2016
|
|
|
|
1,941.6
|
|
|
3,231.5
|
|
|
3,723.1
|
|
|
3,969.5
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
2,074.0
|
|
|
3,478.5
|
|
|
4,048.5
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
2,378.0
|
|
|
4,028.7
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
2,715.2
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
18,477.3
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
63.2
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
5,117.4
|
|
|
|
|
|
Personal Lines - Agency - Physical Damage
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
2,136.8
|
|
|
$
|
2,137.2
|
|
|
$
|
2,134.4
|
|
|
$
|
2,131.5
|
|
|
$
|
2,134.5
|
|
|
$
|
0
|
|
|
1,336,520
|
|
2016
|
|
|
|
2,423.4
|
|
|
2,398.9
|
|
|
2,401.8
|
|
|
2,400.1
|
|
|
(3.8
|
)
|
|
1,399,077
|
|
|||||||
2017
|
|
|
|
|
|
2,635.5
|
|
|
2,638.5
|
|
|
2,643.5
|
|
|
(2.9
|
)
|
|
1,514,531
|
|
||||||||
2018
|
|
|
|
|
|
|
|
2,819.0
|
|
|
2,822.6
|
|
|
(12.3
|
)
|
|
1,694,380
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
3,277.9
|
|
|
(167.6
|
)
|
|
1,872,822
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
13,278.6
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
2,106.2
|
|
|
$
|
2,138.1
|
|
|
$
|
2,134.4
|
|
|
$
|
2,134.1
|
|
|
$
|
2,133.6
|
|
|
|
|
|
|||
2016
|
|
|
|
2,391.0
|
|
|
2,406.9
|
|
|
2,402.1
|
|
|
2,402.2
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
2,599.8
|
|
|
2,643.2
|
|
|
2,640.9
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
2,769.1
|
|
|
2,827.4
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
3,242.5
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
13,246.6
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
0.4
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
32.4
|
|
|
|
|
|
Personal Lines - Direct - Liability
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
3,330.5
|
|
|
$
|
3,328.3
|
|
|
$
|
3,354.2
|
|
|
$
|
3,399.3
|
|
|
$
|
3,368.7
|
|
|
$
|
0
|
|
|
659,243
|
|
2016
|
|
|
|
3,819.0
|
|
|
3,843.9
|
|
|
3,871.2
|
|
|
3,897.8
|
|
|
53.9
|
|
|
735,653
|
|
|||||||
2017
|
|
|
|
|
|
4,209.5
|
|
|
4,209.9
|
|
|
4,229.3
|
|
|
70.9
|
|
|
772,712
|
|
||||||||
2018
|
|
|
|
|
|
|
|
4,904.8
|
|
|
4,980.9
|
|
|
204.4
|
|
|
868,604
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
5,756.5
|
|
|
811.4
|
|
|
953,154
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
22,233.2
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
1,545.2
|
|
|
$
|
2,615.0
|
|
|
$
|
3,021.0
|
|
|
$
|
3,238.2
|
|
|
$
|
3,323.1
|
|
|
|
|
|
|||
2016
|
|
|
|
1,780.6
|
|
|
2,991.1
|
|
|
3,476.9
|
|
|
3,714.6
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
1,912.6
|
|
|
3,255.2
|
|
|
3,808.3
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
2,235.1
|
|
|
3,863.5
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
2,630.3
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
17,339.8
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
43.4
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
4,936.8
|
|
|
|
|
|
Personal Lines - Direct - Physical Damage
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
2,110.7
|
|
|
$
|
2,097.7
|
|
|
$
|
2,093.5
|
|
|
$
|
2,090.8
|
|
|
$
|
2,093.9
|
|
|
$
|
0
|
|
|
1,540,071
|
|
2016
|
|
|
|
2,521.0
|
|
|
2,475.4
|
|
|
2,477.7
|
|
|
2,475.6
|
|
|
(4.3
|
)
|
|
1,676,343
|
|
|||||||
2017
|
|
|
|
|
|
2,750.6
|
|
|
2,743.7
|
|
|
2,749.0
|
|
|
(4.1
|
)
|
|
1,791,190
|
|
||||||||
2018
|
|
|
|
|
|
|
|
3,202.3
|
|
|
3,181.9
|
|
|
(18.8
|
)
|
|
2,069,525
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
3,787.9
|
|
|
(237.7
|
)
|
|
2,282,681
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
14,288.3
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
2,094.7
|
|
|
$
|
2,100.1
|
|
|
$
|
2,094.7
|
|
|
$
|
2,093.7
|
|
|
$
|
2,093.1
|
|
|
|
|
|
|||
2016
|
|
|
|
2,505.0
|
|
|
2,485.8
|
|
|
2,479.3
|
|
|
2,478.5
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
2,742.1
|
|
|
2,753.5
|
|
|
2,748.4
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
3,170.0
|
|
|
3,193.8
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
3,782.6
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
14,296.4
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
0.4
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
(7.7
|
)
|
|
|
|
|
Commercial Lines - Liability
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
897.6
|
|
|
$
|
911.1
|
|
|
$
|
914.8
|
|
|
$
|
899.7
|
|
|
$
|
891.3
|
|
|
$
|
0
|
|
|
77,819
|
|
2016
|
|
|
|
1,185.8
|
|
|
1,204.8
|
|
|
1,231.1
|
|
|
1,238.9
|
|
|
17.2
|
|
|
92,684
|
|
|||||||
2017
|
|
|
|
|
|
1,374.1
|
|
|
1,366.6
|
|
|
1,393.3
|
|
|
30.8
|
|
|
97,297
|
|
||||||||
2018
|
|
|
|
|
|
|
|
1,700.8
|
|
|
1,736.5
|
|
|
97.7
|
|
|
111,146
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
2,103.1
|
|
|
343.7
|
|
|
124,829
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
7,363.1
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
238.4
|
|
|
$
|
501.5
|
|
|
$
|
675.0
|
|
|
$
|
786.3
|
|
|
$
|
848.9
|
|
|
|
|
|
|||
2016
|
|
|
|
298.6
|
|
|
639.9
|
|
|
886.0
|
|
|
1,073.3
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
325.8
|
|
|
712.9
|
|
|
1,027.3
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
382.7
|
|
|
913.4
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
455.4
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
4,318.3
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
36.0
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
3,080.8
|
|
|
|
|
|
Commercial Lines - Physical Damage
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
274.4
|
|
|
$
|
274.1
|
|
|
$
|
273.5
|
|
|
$
|
272.4
|
|
|
$
|
272.4
|
|
|
$
|
0
|
|
|
62,593
|
|
2016
|
|
|
|
379.6
|
|
|
379.8
|
|
|
378.2
|
|
|
377.8
|
|
|
(0.7
|
)
|
|
74,193
|
|
|||||||
2017
|
|
|
|
|
|
415.4
|
|
|
412.1
|
|
|
411.0
|
|
|
(0.6
|
)
|
|
77,163
|
|
||||||||
2018
|
|
|
|
|
|
|
|
475.0
|
|
|
478.2
|
|
|
(2.4
|
)
|
|
82,183
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
577.8
|
|
|
(14.3
|
)
|
|
91,920
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
2,117.2
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
248.5
|
|
|
$
|
271.9
|
|
|
$
|
272.0
|
|
|
$
|
272.2
|
|
|
$
|
272.3
|
|
|
|
|
|
|||
2016
|
|
|
|
336.7
|
|
|
376.9
|
|
|
376.8
|
|
|
377.5
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
369.0
|
|
|
409.4
|
|
|
409.2
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
426.0
|
|
|
475.1
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
516.9
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
2,051.0
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
0.4
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
66.6
|
|
|
|
|
|
Property Business
|
|
|
|
|
|
|
|||||||||||||||||||||
($ in millions)
|
|
|
|
|
|
|
|
|
|
As of
|
|||||||||||||||||
Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
December 31, 2019
|
|||||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
Total of IBNR Liabilities Plus Expected Development on Reported Claims
|
|
|
Cumulative Number of Incurred Claim Counts
|
|
|||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
||||||||||
2015
|
|
$
|
460.0
|
|
|
$
|
416.5
|
|
|
$
|
403.6
|
|
|
$
|
398.8
|
|
|
$
|
396.3
|
|
|
$
|
0.9
|
|
|
41,998
|
|
2016
|
|
|
|
568.6
|
|
|
541.2
|
|
|
537.1
|
|
|
536.5
|
|
|
5.1
|
|
|
53,665
|
|
|||||||
2017
|
|
|
|
|
|
672.8
|
|
|
680.9
|
|
|
683.4
|
|
|
4.1
|
|
|
72,728
|
|
||||||||
2018
|
|
|
|
|
|
|
|
839.0
|
|
|
845.2
|
|
|
34.9
|
|
|
63,243
|
|
|||||||||
2019
|
|
|
|
|
|
|
|
|
|
971.7
|
|
|
160.2
|
|
|
66,824
|
|
||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
3,433.1
|
|
|
|
|
|
||||||||||
Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
|
|
|
|
|
|||||||||||||||||||||||
|
|
For the years ended December 31,
|
|
|
|
|
|||||||||||||||||||||
Accident Year
|
|
20151
|
|
|
20161
|
|
|
20171
|
|
|
20181
|
|
|
2019
|
|
|
|
|
|
||||||||
2015
|
|
$
|
280.3
|
|
|
$
|
372.8
|
|
|
$
|
383.5
|
|
|
$
|
390.1
|
|
|
$
|
393.5
|
|
|
|
|
|
|||
2016
|
|
|
|
415.2
|
|
|
498.2
|
|
|
516.9
|
|
|
526.4
|
|
|
|
|
|
|||||||||
2017
|
|
|
|
|
|
506.7
|
|
|
647.1
|
|
|
670.1
|
|
|
|
|
|
||||||||||
2018
|
|
|
|
|
|
|
|
595.9
|
|
|
781.2
|
|
|
|
|
|
|||||||||||
2019
|
|
|
|
|
|
|
|
|
|
708.0
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
Total
|
|
|
$
|
3,079.2
|
|
|
|
|
|
||||||||||
|
|
All outstanding liabilities before 2015, net of reinsurance1
|
|
|
3.3
|
|
|
|
|
|
|||||||||||||||||
|
|
Liabilities for claims and claim adjustment expenses, net of reinsurance
|
|
|
$
|
357.2
|
|
|
|
|
|
(millions)
|
2019
|
|
|
2018
|
|
||
Net outstanding liabilities
|
|
|
|
||||
Personal Lines
|
|
|
|
||||
Agency, Liability
|
$
|
5,117.4
|
|
|
$
|
4,509.0
|
|
Agency, Physical Damage
|
32.4
|
|
|
43.3
|
|
||
Direct, Liability
|
4,936.8
|
|
|
4,258.6
|
|
||
Direct, Physical Damage
|
(7.7
|
)
|
|
18.4
|
|
||
Commercial Lines
|
|
|
|
||||
Liability
|
3,080.8
|
|
|
2,504.2
|
|
||
Physical Damage
|
66.6
|
|
|
53.9
|
|
||
Property
|
357.2
|
|
|
314.7
|
|
||
Other business
|
30.8
|
|
|
42.9
|
|
||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance
|
13,614.3
|
|
|
11,745.0
|
|
||
Reinsurance recoverable on unpaid claims
|
|
|
|
||||
Personal Lines
|
|
|
|
||||
Agency, Liability
|
930.7
|
|
|
836.8
|
|
||
Agency, Physical Damage
|
0
|
|
|
0
|
|
||
Direct, Liability
|
1,314.1
|
|
|
1,070.4
|
|
||
Direct, Physical Damage
|
0
|
|
|
0
|
|
||
Commercial Lines
|
|
|
|
||||
Liability
|
482.6
|
|
|
287.4
|
|
||
Physical Damage
|
0.5
|
|
|
0
|
|
||
Property
|
184.1
|
|
|
145.4
|
|
||
Other business
|
288.1
|
|
|
222.1
|
|
||
Total reinsurance recoverable on unpaid claims
|
3,200.1
|
|
|
2,562.1
|
|
||
Unallocated claims adjustment expense related to:
|
|
|
|
||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance
|
1,278.9
|
|
|
1,083.1
|
|
||
Reinsurance recoverable on unpaid claims
|
12.1
|
|
|
10.6
|
|
||
Total gross liability for unpaid claims and claim adjustment expense
|
$
|
18,105.4
|
|
|
$
|
15,400.8
|
|
(Required Supplementary Information - Unaudited)
|
|
|
|
|
|
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance
|
Years
|
||||
1
|
2
|
3
|
4
|
5
|
|
Personal Lines
|
|
|
|
|
|
Agency, Liability
|
46.3%
|
31.3%
|
12.1%
|
5.7%
|
2.4%
|
Agency, Physical Damage
|
98.7
|
1.5
|
(0.2)
|
0
|
0
|
Direct, Liability
|
45.4
|
31.9
|
12.6
|
6.3
|
2.5
|
Direct, Physical Damage
|
100.0
|
0.2
|
(0.2)
|
0
|
0
|
Commercial Lines
|
|
|
|
|
|
Liability
|
23.1
|
28.9
|
20.8
|
14.0
|
7.0
|
Physical Damage
|
89.6
|
9.9
|
0
|
0.1
|
0
|
Property
|
73.0
|
20.4
|
3.2
|
1.7
|
0.9
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
(millions)
|
Written
|
|
Earned
|
|
|
Written
|
|
Earned
|
|
|
Written
|
|
Earned
|
|
||||||
Direct premiums
|
$
|
39,222.0
|
|
$
|
37,519.7
|
|
|
$
|
33,753.1
|
|
$
|
31,970.2
|
|
|
$
|
27,860.7
|
|
$
|
26,425.7
|
|
Ceded premiums:
|
|
|
|
|
|
|
|
|
||||||||||||
Regulated
|
(711.1
|
)
|
(670.8
|
)
|
|
(596.4
|
)
|
(557.5
|
)
|
|
(505.9
|
)
|
(479.6
|
)
|
||||||
Non-Regulated
|
(933.0
|
)
|
(656.5
|
)
|
|
(546.8
|
)
|
(479.4
|
)
|
|
(222.7
|
)
|
(216.2
|
)
|
||||||
Total ceded premiums
|
(1,644.1
|
)
|
(1,327.3
|
)
|
|
(1,143.2
|
)
|
(1,036.9
|
)
|
|
(728.6
|
)
|
(695.8
|
)
|
||||||
Net premiums
|
$
|
37,577.9
|
|
$
|
36,192.4
|
|
|
$
|
32,609.9
|
|
$
|
30,933.3
|
|
|
$
|
27,132.1
|
|
$
|
25,729.9
|
|
•
|
Federal reinsurance plan
|
•
|
National Flood Insurance Program (NFIP)
|
•
|
State-provided reinsurance facilities
|
•
|
Michigan Catastrophic Claims Association (MCCA)
|
•
|
North Carolina Reinsurance Facility (NCRF)
|
•
|
Florida Hurricane Catastrophe Fund (FHCF)
|
•
|
State-mandated involuntary plans
|
•
|
Commercial Automobile Insurance Procedures/Plans (CAIP)
|
|
Reinsurance Recoverables
|
|
Prepaid Reinsurance Premiums
|
||||||||||||||||||||
($ in millions)
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||
Regulated:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
MCCA
|
$
|
2,247.1
|
|
67
|
%
|
|
$
|
1,903.9
|
|
71
|
%
|
|
$
|
71.8
|
|
12
|
%
|
|
$
|
55.3
|
|
18
|
%
|
CAIP
|
332.4
|
|
10
|
|
|
254.7
|
|
9
|
|
|
93.8
|
|
15
|
|
|
72.9
|
|
24
|
|
||||
FHCF1
|
86.0
|
|
3
|
|
|
18.5
|
|
1
|
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
||||
NCRF
|
84.4
|
|
2
|
|
|
78.1
|
|
3
|
|
|
33.8
|
|
5
|
|
|
34.0
|
|
11
|
|
||||
NFIP
|
11.6
|
|
0
|
|
|
27.8
|
|
1
|
|
|
58.7
|
|
9
|
|
|
55.9
|
|
18
|
|
||||
Other
|
3.1
|
|
0
|
|
|
2.9
|
|
0
|
|
|
1.0
|
|
0
|
|
|
0.6
|
|
0
|
|
||||
Total Regulated
|
2,764.6
|
|
82
|
|
|
2,285.9
|
|
85
|
|
|
259.1
|
|
41
|
|
|
218.7
|
|
71
|
|
||||
Non-Regulated:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Commercial Lines
|
459.5
|
|
14
|
|
|
254.2
|
|
10
|
|
|
352.9
|
|
56
|
|
|
79.2
|
|
25
|
|
||||
Property
|
146.8
|
|
4
|
|
|
147.7
|
|
5
|
|
|
14.5
|
|
3
|
|
|
11.8
|
|
4
|
|
||||
Other
|
8.0
|
|
0
|
|
|
8.3
|
|
0
|
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
||||
Total Non-Regulated
|
614.3
|
|
18
|
|
|
410.2
|
|
15
|
|
|
367.4
|
|
59
|
|
|
91.0
|
|
29
|
|
||||
Total
|
$
|
3,378.9
|
|
100
|
%
|
|
$
|
2,696.1
|
|
100
|
%
|
|
$
|
626.5
|
|
100
|
%
|
|
$
|
309.7
|
|
100
|
%
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
(millions)
|
Pretax
|
|
After Tax
|
|
|
Pretax
|
|
After Tax
|
|
|
Pretax
|
|
After Tax
|
|
||||||
Non-equity incentive plans – cash
|
$
|
598.4
|
|
$
|
472.7
|
|
|
$
|
539.5
|
|
$
|
426.2
|
|
|
$
|
461.3
|
|
$
|
299.8
|
|
Equity incentive plans:
|
|
|
|
|
|
|
|
|
||||||||||||
Equity awards
|
90.1
|
|
71.2
|
|
|
76.2
|
|
60.2
|
|
|
92.9
|
|
60.4
|
|
||||||
Liability awards
|
0.1
|
|
0.1
|
|
|
1.0
|
|
0.8
|
|
|
2.5
|
|
1.6
|
|
Performance Measurement
|
Year(s) of Grant
|
Vesting range (as a percentage of target)
|
Growth of our personal auto and commercial auto businesses and homeowners multi-peril business, each compared to its respective market
|
2018-2019
|
0-250%
|
Growth of our personal auto and commercial auto businesses, compared to the combined personal and commercial auto market
|
2014-2017
|
0-250%
|
Investment results relative to peer group
|
2014-2019
|
0-200%
|
Unit growth in a specified customer segment
|
2016-2017
|
0% or 85-150%
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Restricted Equity Awards
|
Number of Shares1
|
|
Weighted
Average
Grant
Date Fair
Value
|
|
|
Number of
Shares1
|
|
Weighted
Average
Grant
Date Fair
Value
|
|
|
Number of
Shares1
|
|
Weighted
Average
Grant
Date Fair
Value
|
|
|||
Beginning of year
|
4,856,356
|
|
$
|
38.56
|
|
|
5,858,848
|
|
$
|
30.47
|
|
|
6,951,373
|
|
$
|
26.18
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|
|||||||||
Granted2
|
1,835,145
|
|
49.61
|
|
|
1,876,109
|
|
45.55
|
|
|
2,383,475
|
|
32.01
|
|
|||
Vested
|
(2,691,337
|
)
|
31.85
|
|
|
(2,811,070
|
)
|
26.41
|
|
|
(3,220,671
|
)
|
22.53
|
|
|||
Forfeited
|
(121,087
|
)
|
43.98
|
|
|
(67,531
|
)
|
36.10
|
|
|
(255,329
|
)
|
28.03
|
|
|||
End of year3,4
|
3,879,077
|
|
$
|
48.28
|
|
|
4,856,356
|
|
$
|
38.56
|
|
|
5,858,848
|
|
$
|
30.47
|
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Options Outstanding
|
Number of Shares
|
|
Weighted Average
Exercise Price |
|
|
Number of Shares
|
|
Weighted Average
Exercise Price |
|
|
Number of Shares
|
|
Weighted Average
Exercise Price |
|
|||
Beginning of year
|
16,067
|
|
$
|
588.15
|
|
|
22,550
|
|
$
|
564.60
|
|
|
24,995
|
|
$
|
526.46
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|
|||||||||
Exercised1
|
(5,329
|
)
|
353.67
|
|
|
(6,483
|
)
|
506.26
|
|
|
(2,445
|
)
|
174.65
|
|
|||
Forfeited
|
(300
|
)
|
803.64
|
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
|||
End of year
|
10,438
|
|
$
|
701.66
|
|
|
16,067
|
|
$
|
588.15
|
|
|
22,550
|
|
$
|
564.60
|
|
Exercisable, end of year
|
10,438
|
|
$
|
701.66
|
|
|
13,967
|
|
$
|
562.17
|
|
|
17,950
|
|
$
|
517.75
|
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Non-Vested Options Outstanding
|
Number of Shares
|
|
Weighted Average
Exercise Price |
|
|
Number of Shares
|
|
Weighted Average
Exercise Price |
|
|
Number of Shares
|
|
Weighted Average
Exercise Price |
|
|||
Beginning of year
|
2,100
|
|
$
|
760.93
|
|
|
4,600
|
|
$
|
747.45
|
|
|
8,000
|
|
$
|
712.74
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|
|||||||||
Vested
|
(1,800
|
)
|
753.82
|
|
|
(2,500
|
)
|
736.12
|
|
|
(3,400
|
)
|
665.79
|
|
|||
Forfeited
|
(300
|
)
|
803.64
|
|
|
0
|
|
0
|
|
|
0
|
|
0
|
|
|||
End of year
|
0
|
|
$
|
0
|
|
|
2,100
|
|
$
|
760.93
|
|
|
4,600
|
|
$
|
747.45
|
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Restricted Stock
|
Number of
Shares
|
|
Weighted
Average
Grant
Date Fair
Value
|
|
|
Number of
Shares
|
|
Weighted
Average
Grant
Date Fair
Value
|
|
|
Number of
Shares
|
|
Weighted
Average
Grant
Date Fair
Value
|
|
|||
Beginning of year
|
41,706
|
|
$
|
62.23
|
|
|
53,284
|
|
$
|
40.54
|
|
|
55,839
|
|
$
|
33.24
|
|
Add (deduct):
|
|
|
|
|
|
|
|
|
|||||||||
Granted
|
38,451
|
|
73.43
|
|
|
41,706
|
|
62.23
|
|
|
53,284
|
|
40.54
|
|
|||
Vested
|
(41,706
|
)
|
62.23
|
|
|
(53,284
|
)
|
40.54
|
|
|
(55,839
|
)
|
33.24
|
|
|||
End of year1
|
38,451
|
|
$
|
73.43
|
|
|
41,706
|
|
$
|
62.23
|
|
|
53,284
|
|
$
|
40.54
|
|
(millions)
|
2019
|
|
2018
|
|
||
Progressive common shares1
|
$
|
121.6
|
|
$
|
114.7
|
|
Other investment funds2
|
151.2
|
|
124.0
|
|
||
Total
|
$
|
272.8
|
|
$
|
238.7
|
|
|
2019
|
|
2018
|
|
2017
|
|||||||||||||||
(millions)
|
Revenues
|
|
Pretax
Profit
(Loss)
|
|
|
Revenues
|
|
Pretax
Profit
(Loss)
|
|
|
Revenues
|
|
Pretax
Profit
(Loss)
|
|
||||||
Personal Lines
|
|
|
|
|
|
|
|
|
||||||||||||
Agency
|
$
|
14,904.1
|
|
$
|
1,673.2
|
|
|
$
|
13,017.2
|
|
$
|
1,435.7
|
|
|
$
|
11,177.6
|
|
$
|
839.6
|
|
Direct
|
15,305.9
|
|
1,181.4
|
|
|
13,017.5
|
|
1,088.5
|
|
|
10,769.6
|
|
683.7
|
|
||||||
Total Personal Lines1
|
30,210.0
|
|
2,854.6
|
|
|
26,034.7
|
|
2,524.2
|
|
|
21,947.2
|
|
1,523.3
|
|
||||||
Commercial Lines
|
4,427.6
|
|
458.8
|
|
|
3,610.9
|
|
478.6
|
|
|
2,793.9
|
|
214.1
|
|
||||||
Property2
|
1,554.8
|
|
(26.1
|
)
|
|
1,287.7
|
|
(88.7
|
)
|
|
988.8
|
|
(50.3
|
)
|
||||||
Other indemnity
|
0
|
|
0
|
|
|
0
|
|
0.9
|
|
|
0
|
|
(0.2
|
)
|
||||||
Total underwriting operations
|
36,192.4
|
|
3,287.3
|
|
|
30,933.3
|
|
2,915.0
|
|
|
25,729.9
|
|
1,686.9
|
|
||||||
Fees and other revenues3
|
563.7
|
|
NA
|
|
|
472.2
|
|
NA
|
|
|
370.6
|
|
NA
|
|
||||||
Service businesses
|
195.0
|
|
16.1
|
|
|
158.5
|
|
24.4
|
|
|
126.8
|
|
17.3
|
|
||||||
Investments4
|
2,071.2
|
|
2,046.6
|
|
|
415.0
|
|
390.7
|
|
|
612.7
|
|
588.8
|
|
||||||
Other gains (losses)
|
0
|
|
0
|
|
|
0
|
|
0
|
|
|
(1.0
|
)
|
(1.0
|
)
|
||||||
Interest expense
|
NA
|
|
(189.7
|
)
|
|
NA
|
|
(166.5
|
)
|
|
NA
|
|
(153.1
|
)
|
||||||
Consolidated total
|
$
|
39,022.3
|
|
$
|
5,160.3
|
|
|
$
|
31,979.0
|
|
$
|
3,163.6
|
|
|
$
|
26,839.0
|
|
$
|
2,138.9
|
|
|
2019
|
|
2018
|
|
2017
|
||||||
|
Underwriting
Margin
|
|
Combined
Ratio
|
|
Underwriting
Margin
|
|
Combined
Ratio
|
|
Underwriting
Margin
|
|
Combined
Ratio
|
Personal Lines
|
|
|
|
|
|
|
|
|
|||
Agency
|
11.2
|
%
|
88.8
|
|
11.0
|
%
|
89.0
|
|
7.5
|
%
|
92.5
|
Direct
|
7.7
|
|
92.3
|
|
8.4
|
|
91.6
|
|
6.3
|
|
93.7
|
Total Personal Lines
|
9.5
|
|
90.5
|
|
9.7
|
|
90.3
|
|
6.9
|
|
93.1
|
Commercial Lines
|
10.4
|
|
89.6
|
|
13.3
|
|
86.7
|
|
7.7
|
|
92.3
|
Property1
|
(1.7
|
)
|
101.7
|
|
(6.9
|
)
|
106.9
|
|
(5.1
|
)
|
105.1
|
Total underwriting operations
|
9.1
|
|
90.9
|
|
9.4
|
|
90.6
|
|
6.6
|
|
93.4
|
|
|
|
|
|
|
|
Components of Changes in
Accumulated Other
Comprehensive Income (after tax)
|
||||||||||||||||||||
(millions)
|
Pretax total
accumulated
other
comprehensive
income (loss)
|
|
|
Total tax
(provision)
benefit
|
|
|
After tax total
accumulated
other
comprehensive
income (loss)
|
|
|
Total net
unrealized
gains
(losses)
on securities
|
|
|
Net
unrealized
gains (losses)
on
forecasted
transactions
|
|
|
Foreign
currency
translation
adjustment
|
|
|
(Income) loss attributable to NCI
|
|
|||||||
Balance at December 31, 2018
|
$
|
(153.0
|
)
|
|
$
|
32.1
|
|
|
$
|
(120.9
|
)
|
|
$
|
(105.6
|
)
|
|
$
|
(17.2
|
)
|
|
$
|
0
|
|
|
$
|
1.9
|
|
Other comprehensive income (loss) before reclassifications:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Investment securities
|
825.8
|
|
|
(174.9
|
)
|
|
650.9
|
|
|
650.9
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Forecasted transactions
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Foreign currency translation adjustment
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
(Income) loss attributable to noncontrolling interest (NCI)
|
(5.9
|
)
|
|
1.3
|
|
|
(4.6
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|
(4.6
|
)
|
|||||||
Total other comprehensive income (loss) before reclassifications
|
819.9
|
|
|
(173.6
|
)
|
|
646.3
|
|
|
650.9
|
|
|
0
|
|
|
0
|
|
|
(4.6
|
)
|
|||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net impairment losses recognized in earnings
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Net realized gains (losses) on securities
|
232.2
|
|
|
(47.7
|
)
|
|
184.5
|
|
|
184.5
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Other gains (losses)
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Interest expense
|
(1.0
|
)
|
|
0.2
|
|
|
(0.8
|
)
|
|
0
|
|
|
(0.8
|
)
|
|
0
|
|
|
0
|
|
|||||||
Total reclassification adjustment for amounts realized in net income
|
231.2
|
|
|
(47.5
|
)
|
|
183.7
|
|
|
184.5
|
|
|
(0.8
|
)
|
|
0
|
|
|
0
|
|
|||||||
Total other comprehensive income (loss)
|
588.7
|
|
|
(126.1
|
)
|
|
462.6
|
|
|
466.4
|
|
|
0.8
|
|
|
0
|
|
|
(4.6
|
)
|
|||||||
Balance at December 31, 2019
|
$
|
435.7
|
|
|
$
|
(94.0
|
)
|
|
$
|
341.7
|
|
|
$
|
360.8
|
|
|
$
|
(16.4
|
)
|
|
$
|
0
|
|
|
$
|
(2.7
|
)
|
|
|
|
|
|
|
|
Components of Changes in
Accumulated Other
Comprehensive Income (after tax)
|
||||||||||||||||||||
(millions)
|
Pretax total
accumulated other comprehensive income (loss) |
|
|
Total tax
(provision) benefit |
|
|
After tax total
accumulated other comprehensive income (loss) |
|
|
Total net
unrealized gains (losses) on securities |
|
|
Net
unrealized gains (losses) on forecasted transactions |
|
|
Foreign
currency translation adjustment |
|
|
(Income) loss attributable to NCI
|
|
|||||||
Balance at December 31, 2017
|
$
|
1,977.8
|
|
|
$
|
(695.6
|
)
|
|
$
|
1,282.2
|
|
|
$
|
1,295.0
|
|
|
$
|
(14.8
|
)
|
|
$
|
0
|
|
|
$
|
2.0
|
|
Cumulative effect adjustment1
|
(2,006.0
|
)
|
|
705.8
|
|
|
(1,300.2
|
)
|
|
(1,300.2
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Reclassification of disproportionate amounts2
|
(4.3
|
)
|
|
(3.4
|
)
|
|
(7.7
|
)
|
|
(1.1
|
)
|
|
(3.2
|
)
|
|
0
|
|
|
(3.4
|
)
|
|||||||
Adjusted balance at December 31, 2017
|
(32.5
|
)
|
|
6.8
|
|
|
(25.7
|
)
|
|
(6.3
|
)
|
|
(18.0
|
)
|
|
0
|
|
|
(1.4
|
)
|
|||||||
Other comprehensive income (loss) before reclassifications:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Investment securities
|
(224.1
|
)
|
|
47.0
|
|
|
(177.1
|
)
|
|
(177.1
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Forecasted transactions
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Foreign currency translation adjustment
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
(Income) loss attributable to noncontrolling interest (NCI)
|
4.3
|
|
|
(1.0
|
)
|
|
3.3
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
3.3
|
|
|||||||
Total other comprehensive income (loss) before reclassifications
|
(219.8
|
)
|
|
46.0
|
|
|
(173.8
|
)
|
|
(177.1
|
)
|
|
0
|
|
|
0
|
|
|
3.3
|
|
|||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net impairment losses recognized in earnings
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Net realized gains (losses) on securities
|
(98.3
|
)
|
|
20.5
|
|
|
(77.8
|
)
|
|
(77.8
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Other gains (losses)
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Interest expense
|
(1.0
|
)
|
|
0.2
|
|
|
(0.8
|
)
|
|
0
|
|
|
(0.8
|
)
|
|
0
|
|
|
0
|
|
|||||||
Total reclassification adjustment for amounts realized in net income
|
(99.3
|
)
|
|
20.7
|
|
|
(78.6
|
)
|
|
(77.8
|
)
|
|
(0.8
|
)
|
|
0
|
|
|
0
|
|
|||||||
Total other comprehensive income (loss)
|
(120.5
|
)
|
|
25.3
|
|
|
(95.2
|
)
|
|
(99.3
|
)
|
|
0.8
|
|
|
0
|
|
|
3.3
|
|
|||||||
Balance at December 31, 2018
|
$
|
(153.0
|
)
|
|
$
|
32.1
|
|
|
$
|
(120.9
|
)
|
|
$
|
(105.6
|
)
|
|
$
|
(17.2
|
)
|
|
$
|
0
|
|
|
$
|
1.9
|
|
|
|
|
|
|
|
|
Components of Changes in
Accumulated Other
Comprehensive Income (after tax)
|
||||||||||||||||||||
(millions)
|
Pretax total
accumulated other comprehensive income (loss) |
|
|
Total tax
(provision) benefit |
|
|
After tax total
accumulated other comprehensive income (loss) |
|
|
Total net
unrealized gains (losses) on securities |
|
|
Net
unrealized gains (losses) on forecasted transactions |
|
|
Foreign
currency translation adjustment |
|
|
(Income) loss attributable to NCI
|
|
|||||||
Total at December 31, 2016
|
$
|
1,439.5
|
|
|
$
|
(506.1
|
)
|
|
$
|
933.4
|
|
|
$
|
939.6
|
|
|
$
|
(9.4
|
)
|
|
$
|
(1.1
|
)
|
|
$
|
4.3
|
|
Other comprehensive income (loss) before reclassifications:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Investment securities
|
636.9
|
|
|
(224.0
|
)
|
|
412.9
|
|
|
412.9
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Forecasted transactions
|
(8.0
|
)
|
|
2.8
|
|
|
(5.2
|
)
|
|
0
|
|
|
(5.2
|
)
|
|
0
|
|
|
0
|
|
|||||||
Foreign currency translation adjustment
|
0.4
|
|
|
(0.1
|
)
|
|
0.3
|
|
|
0
|
|
|
0
|
|
|
0.3
|
|
|
0
|
|
|||||||
(Income) loss attributable to noncontrolling interest (NCI)
|
(3.5
|
)
|
|
1.2
|
|
|
(2.3
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|
(2.3
|
)
|
|||||||
Total other comprehensive income (loss) before reclassifications
|
625.8
|
|
|
(220.1
|
)
|
|
405.7
|
|
|
412.9
|
|
|
(5.2
|
)
|
|
0.3
|
|
|
(2.3
|
)
|
|||||||
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net impairment losses recognized in earnings
|
(14.9
|
)
|
|
5.3
|
|
|
(9.6
|
)
|
|
(9.6
|
)
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Net realized gains (losses) on securities
|
103.3
|
|
|
(36.2
|
)
|
|
67.1
|
|
|
67.1
|
|
|
0
|
|
|
0
|
|
|
0
|
|
|||||||
Other gains (losses)1
|
(1.2
|
)
|
|
0.4
|
|
|
(0.8
|
)
|
|
0
|
|
|
0
|
|
|
(0.8
|
)
|
|
0
|
|
|||||||
Interest expense
|
0.3
|
|
|
(0.1
|
)
|
|
0.2
|
|
|
0
|
|
|
0.2
|
|
|
0
|
|
|
0
|
|
|||||||
Total reclassification adjustment for amounts realized in net income
|
87.5
|
|
|
(30.6
|
)
|
|
56.9
|
|
|
57.5
|
|
|
0.2
|
|
|
(0.8
|
)
|
|
0
|
|
|||||||
Total other comprehensive income (loss)
|
538.3
|
|
|
(189.5
|
)
|
|
348.8
|
|
|
355.4
|
|
|
(5.4
|
)
|
|
1.1
|
|
|
(2.3
|
)
|
|||||||
Total at December 31, 2017
|
$
|
1,977.8
|
|
|
$
|
(695.6
|
)
|
|
$
|
1,282.2
|
|
|
$
|
1,295.0
|
|
|
$
|
(14.8
|
)
|
|
$
|
0
|
|
|
$
|
2.0
|
|
•
|
alleging we sell or charge insureds for illusory coverage or coverage lower than amounts allowed by law for personal injury protection (PIP) coverage and pay related claims at levels lower than allowed by law.
|
•
|
challenging how physical damage claims are handled, adjusted, and ultimately paid, including how we value total loss claims, the payment of fees and taxes associated with total losses, and the payment of diminution damages.
|
•
|
challenging our practice in Florida of adjusting PIP payments.
|
•
|
challenging our assessment of fees.
|
•
|
challenging our adjustment of medical bills submitted by insureds or medical providers in medical claims.
|
•
|
challenging our payment and reimbursement practices to Medicare Advantage Plans on first party medical, PIP, and bodily injury claims.
|
•
|
alleging we improperly sell secondary PIP coverage to Medicare and Medicaid beneficiaries in New Jersey.
|
•
|
challenging our acceptance of uninsured motorist (UM) rejection.
|
•
|
alleging we sell illusory underinsured motorist (UIM) coverage.
|
•
|
alleging that we wrongly pursue subrogation of medical payments paid directly to providers and not to insureds.
|
•
|
alleging that we must pay an insured the pre-loss actual cash value of a totaled vehicle in addition to the value of the salvage vehicle if we take ownership of the salvage vehicle.
|
•
|
alleging legal malpractice by tort counsel appointed by and paid by Progressive to defend our insureds in civil cases.
|
•
|
alleging that we improperly adjust property claims by depreciating labor costs.
|
•
|
alleging that we improperly calculate basic economic loss as it relates to wage loss coverage in New York.
|
•
|
alleging that we violated the Telephone Consumer Protection Act.
|
•
|
challenging certain pay practices with respect to our non-exempt employee population.
|
•
|
alleging that we undervalued total loss claims through the use of certain valuation tools.
|
•
|
challenging the manner in which we grant a discount for anti-theft devices.
|
•
|
alleging that we fail to pay overtime to certain employees who we classify as exempt from overtime pay requirements.
|
•
|
challenging our compliance with certain provisions of the California Labor Code with respect to our non-exempt California employee population.
|
•
|
challenging the estimation of physical damage and payment practices for physical damage repairs, and allegations of tortious interference with contract and insurance industry antitrust practice asserted by body shops outside our network program.
|
•
|
claiming that we and other shareholders were overpaid for stock as part of a leveraged buy-out that preceded the entity’s bankruptcy.
|
•
|
claiming patent infringement.
|
•
|
alleging that we are vicariously liable for the fraudulent acts of an agent.
|
•
|
challenging, on a representative basis, certain of our pay practices.
|
•
|
challenging various employment practices.
|
(millions)
|
Commitments
|
|
|
2020
|
$
|
77.6
|
|
2021
|
64.3
|
|
|
2022
|
33.1
|
|
|
2023
|
18.5
|
|
|
2024
|
11.9
|
|
|
Thereafter
|
6.1
|
|
|
Total
|
211.5
|
|
|
Interest
|
(10.0
|
)
|
|
Present value of lease liabilities
|
$
|
201.5
|
|
Weighted-average remaining term
|
3.3 years
|
|
|
Weighted-average discount rate
|
3.0
|
%
|
(millions)
|
Expense
|
|
|
2019
|
$
|
102.0
|
|
2018
|
77.3
|
|
|
2017
|
77.2
|
|
(millions)
|
Commitments
|
|
|
2019
|
$
|
64.1
|
|
2020
|
65.5
|
|
|
2021
|
52.8
|
|
|
2022
|
24.3
|
|
|
2023
|
8.5
|
|
|
Thereafter
|
3.8
|
|
|
Total
|
$
|
219.0
|
|
(millions)
|
2019
|
2018
|
2017
|
||||||
Balance, beginning of year
|
$
|
214.5
|
|
$
|
503.7
|
|
$
|
483.7
|
|
Net income attributable to NCI
|
9.7
|
|
5.7
|
|
5.9
|
|
|||
Other comprehensive income (loss) attributable to NCI1
|
4.6
|
|
(3.3
|
)
|
2.3
|
|
|||
Exercise of stock options
|
7.7
|
|
9.4
|
|
3.4
|
|
|||
Purchase/change of ARX minority shares
|
(11.2
|
)
|
(298.2
|
)
|
0
|
|
|||
Change in redemption value
|
0.3
|
|
(2.8
|
)
|
8.4
|
|
|||
Balance, end of year
|
$
|
225.6
|
|
$
|
214.5
|
|
$
|
503.7
|
|
(millions)
|
2019
|
|
2018
|
||||
Intangible assets subject to amortization
|
$
|
215.9
|
|
|
$
|
282.2
|
|
Indefinite-lived intangible assets1
|
12.4
|
|
|
12.4
|
|
||
Total
|
$
|
228.3
|
|
|
$
|
294.6
|
|
(millions)
|
2019
|
|
2018
|
||||||||||||||||
Category
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
||||||
Policies in force
|
$
|
256.2
|
|
$
|
173.9
|
|
$
|
82.3
|
|
|
$
|
256.2
|
|
$
|
137.3
|
|
$
|
118.9
|
|
Agency relationships
|
159.2
|
|
54.0
|
|
105.2
|
|
|
159.2
|
|
42.6
|
|
116.6
|
|
||||||
Software rights
|
79.1
|
|
50.7
|
|
28.4
|
|
|
79.1
|
|
40.1
|
|
39.0
|
|
||||||
Trade name
|
34.8
|
|
34.8
|
|
0
|
|
|
34.8
|
|
27.1
|
|
7.7
|
|
||||||
Total
|
$
|
529.3
|
|
$
|
313.4
|
|
$
|
215.9
|
|
|
$
|
529.3
|
|
$
|
247.1
|
|
$
|
282.2
|
|
/s/ PricewaterhouseCoopers LLP
|
Cleveland, Ohio
|
March 2, 2020
|
•
|
Dividends
|
◦
|
Common shares - declared aggregate dividends of $2.65 per common share, or $1.55 billion.
|
◦
|
Preferred shares - declared aggregate Series B Preferred dividends of
|
•
|
Share Repurchases - acquired 1.3 million of our common shares at a total cost of $91.3 million, primarily pursuant to our equity compensation plans and to neutralize dilution from equity-based compensation in the year of issuance as stated in our financial policies.
|
•
|
$2.7 billion for common and preferred share dividends;
|
•
|
$0.7 billion to redeem outstanding debt; we have no debt that will mature during the next 12 months;
|
•
|
$0.5 billion for interest on our outstanding debt;
|
•
|
$0.3 billion to acquire additional shares and increase our ownership of ARX; and
|
•
|
$0.2 billion to repurchase our common shares.
|
•
|
The first layer of capital, which we refer to as “regulatory capital,” is the amount of capital we need to satisfy state insurance regulatory requirements and support our objective of writing all the business we can write and service, consistent with our underwriting discipline of achieving a combined ratio of 96 or better. This capital is held by our various insurance entities.
|
•
|
The second layer of capital we call “extreme contingency.” While our regulatory capital is, by definition, a cushion for absorbing financial consequences of adverse events, such as loss reserve development, litigation, weather catastrophes, and investment market corrections, we view that as a base and hold additional capital for even more extreme conditions. The modeling used to quantify capital needs for these conditions is extensive, including tens of thousands of simulations, representing our best estimates of such contingencies based on historical experience. This capital is held either at a non-insurance subsidiary of the holding company or in our insurance entities, where it is potentially eligible for a dividend up to the holding company.
|
•
|
The third layer is capital in excess of the sum of the first two layers and provides maximum flexibility to fund other business opportunities, repurchase stock or other securities, satisfy acquisition-related commitments, and pay dividends to shareholders, among other purposes. This capital is largely held at a non-insurance subsidiary of the holding company.
|
|
Payments due by period
|
||||||||||||||
(millions)
|
Total
|
|
Less than
1 year
|
|
1-3
years
|
|
3-5
years
|
|
More than
5 years
|
|
|||||
Debt
|
$
|
4,450.0
|
|
$
|
0
|
|
$
|
500.0
|
|
$
|
0
|
|
$
|
3,950.0
|
|
Interest payments on debt
|
3,284.8
|
|
188.2
|
|
357.5
|
|
338.8
|
|
2,400.3
|
|
|||||
Operating lease obligations
|
211.5
|
|
77.6
|
|
97.4
|
|
30.4
|
|
6.1
|
|
|||||
Purchase obligations
|
857.0
|
|
722.8
|
|
125.3
|
|
8.8
|
|
0.1
|
|
|||||
Catastrophe excess of loss reinsurance contracts1
|
96.1
|
|
84.6
|
|
11.5
|
|
0
|
|
0
|
|
|||||
Loss and loss adjustment expense reserves
|
18,105.4
|
|
8,931.2
|
|
6,013.6
|
|
1,569.9
|
|
1,590.7
|
|
|||||
Total
|
$
|
27,004.8
|
|
$
|
10,004.4
|
|
$
|
7,105.3
|
|
$
|
1,947.9
|
|
$
|
7,947.2
|
|
|
2019
|
|
|
2018
|
|
|
2017
|
|
Personal Lines
|
|
|
|
|
|
|||
Agency
|
41
|
%
|
|
41
|
%
|
|
43
|
%
|
Direct
|
42
|
|
|
42
|
|
|
42
|
|
Total Personal Lines
|
83
|
|
|
83
|
|
|
85
|
|
Commercial Lines
|
13
|
|
|
12
|
|
|
11
|
|
Property
|
4
|
|
|
5
|
|
|
4
|
|
Total underwriting operations
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
2019
|
|
2018
|
|
2017
|
||||||||||||
Underwriting
Profit (Loss)
|
|
Underwriting
Profit (Loss)
|
|
Underwriting
Profit (Loss)
|
|||||||||||||
($ in millions)
|
$
|
Margin
|
|
|
$
|
Margin
|
|
|
$
|
Margin
|
|
||||||
Personal Lines
|
|
|
|
|
|
|
|
|
|||||||||
Agency
|
$
|
1,673.2
|
|
11.2
|
%
|
|
$
|
1,435.7
|
|
11.0
|
%
|
|
$
|
839.6
|
|
7.5
|
%
|
Direct
|
1,181.4
|
|
7.7
|
|
|
1,088.5
|
|
8.4
|
|
|
683.7
|
|
6.3
|
|
|||
Total Personal Lines
|
2,854.6
|
|
9.5
|
|
|
2,524.2
|
|
9.7
|
|
|
1,523.3
|
|
6.9
|
|
|||
Commercial Lines
|
458.8
|
|
10.4
|
|
|
478.6
|
|
13.3
|
|
|
214.1
|
|
7.7
|
|
|||
Property1
|
(26.1
|
)
|
(1.7
|
)
|
|
(88.7
|
)
|
(6.9
|
)
|
|
(50.3
|
)
|
(5.1
|
)
|
|||
Other indemnity2
|
0
|
|
NM
|
|
|
0.9
|
|
NM
|
|
|
(0.2
|
)
|
NM
|
|
|||
Total underwriting operations
|
$
|
3,287.3
|
|
9.1
|
%
|
|
$
|
2,915.0
|
|
9.4
|
%
|
|
$
|
1,686.9
|
|
6.6
|
%
|
Underwriting Performance1
|
2019
|
|
2018
|
|
2017
|
|
Personal Lines – Agency
|
|
|
|
|||
Loss & loss adjustment expense ratio
|
69.8
|
|
69.8
|
|
73.0
|
|
Underwriting expense ratio
|
19.0
|
|
19.2
|
|
19.5
|
|
Combined ratio
|
88.8
|
|
89.0
|
|
92.5
|
|
Personal Lines – Direct
|
|
|
|
|||
Loss & loss adjustment expense ratio
|
71.4
|
|
71.4
|
|
74.1
|
|
Underwriting expense ratio
|
20.9
|
|
20.2
|
|
19.6
|
|
Combined ratio
|
92.3
|
|
91.6
|
|
93.7
|
|
Total Personal Lines
|
|
|
|
|||
Loss & loss adjustment expense ratio
|
70.6
|
|
70.6
|
|
73.6
|
|
Underwriting expense ratio
|
19.9
|
|
19.7
|
|
19.5
|
|
Combined ratio
|
90.5
|
|
90.3
|
|
93.1
|
|
Commercial Lines
|
|
|
|
|||
Loss & loss adjustment expense ratio
|
68.5
|
|
66.3
|
|
70.3
|
|
Underwriting expense ratio
|
21.1
|
|
20.4
|
|
22.0
|
|
Combined ratio
|
89.6
|
|
86.7
|
|
92.3
|
|
Property
|
|
|
|
|||
Loss & loss adjustment expense ratio
|
71.2
|
|
72.8
|
|
70.8
|
|
Underwriting expense ratio2
|
30.5
|
|
34.1
|
|
34.3
|
|
Combined ratio2
|
101.7
|
|
106.9
|
|
105.1
|
|
Total Underwriting Operations
|
|
|
|
|||
Loss & loss adjustment expense ratio
|
70.4
|
|
70.2
|
|
73.1
|
|
Underwriting expense ratio
|
20.5
|
|
20.4
|
|
20.3
|
|
Combined ratio
|
90.9
|
|
90.6
|
|
93.4
|
|
Accident year – Loss & loss adjustment expense ratio3
|
69.8
|
|
69.9
|
|
73.0
|
|
(millions)
|
2019
|
|
2018
|
|
2017
|
|
|||
Change in net loss and LAE reserves
|
$
|
2,065.1
|
|
$
|
1,911.3
|
|
$
|
1,349.8
|
|
Paid losses and LAE
|
23,405.4
|
|
19,809.7
|
|
17,458.2
|
|
|||
Total incurred losses and LAE
|
$
|
25,470.5
|
|
$
|
21,721.0
|
|
$
|
18,808.0
|
|
($ in millions)
|
2019
|
2018
|
2017
|
||||||
Personal Lines
|
$
|
323.4
|
|
$
|
326.2
|
|
$
|
510.1
|
|
Commercial Lines
|
13.6
|
|
10.9
|
|
21.1
|
|
|||
Property
|
|
|
|
||||||
Property business, net of reinsurance (excluding ASL)
|
267.2
|
|
274.4
|
|
303.5
|
|
|||
Reinsurance recoverable on ASL1
|
(52.7
|
)
|
(5.6
|
)
|
(4.2
|
)
|
|||
Property business, net
|
214.5
|
|
268.8
|
|
299.3
|
|
|||
Total catastrophe losses incurred
|
$
|
551.5
|
|
$
|
605.9
|
|
$
|
830.5
|
|
Combined ratio effect
|
1.5
|
pts.
|
2.0
|
pts.
|
3.2
|
pts.
|
|
Calendar Year
|
||||||
(millions)
|
2019
|
|
2018
|
||||
Reinsurance recoverable on ASL, balance at January 1
|
$
|
12.5
|
|
|
$
|
4.6
|
|
Reinsurance recoverables recognized on losses
|
|
|
|
||||
Accident year:
|
|
|
|
||||
2019
|
48.8
|
|
|
NA
|
|
||
2018
|
0
|
|
|
0
|
|
||
2017
|
3.9
|
|
|
5.6
|
|
||
Total
|
52.7
|
|
|
5.6
|
|
||
Reinsurance recoverables recognized on ALAE
|
|
|
|
||||
Accident year:
|
|
|
|
||||
2019
|
5.7
|
|
|
NA
|
|
||
2018
|
0
|
|
|
0
|
|
||
2017
|
(1.2
|
)
|
|
2.3
|
|
||
Total
|
4.5
|
|
|
2.3
|
|
||
Total reinsurance recoverables recognized
|
|
|
|
||||
Accident year:
|
|
|
|
||||
2019
|
54.5
|
|
|
NA
|
|
||
2018
|
0
|
|
|
0
|
|
||
2017
|
2.7
|
|
|
7.9
|
|
||
Total
|
57.2
|
|
|
7.9
|
|
||
Reinsurance recoverable on ASL, balance at December 31
|
$
|
69.7
|
|
|
$
|
12.5
|
|
•
|
2019 - Severity increased about 8% for our bodily injury coverages, 7% for our personal injury protection (PIP) coverage, and 6% for our collision and property damage coverages.
|
•
|
2018 - Severity increased about 8% for our collision coverage, about 4% for our property damage and bodily injury coverages, and about 2% for our PIP coverage.
|
•
|
2017 - Severity increased about 5% for our property damage coverage, about 4% for our PIP coverage, and 2% for our bodily injury coverage, while collision coverage was flat.
|
•
|
2019 - Frequency decreased 5% for our PIP coverage, 4% for our collision and property damage coverages, and 3% for our bodily injury coverages.
|
•
|
2018 - Frequency decreased about 3% for all coverages (PIP, collision, property damage, and bodily injury).
|
•
|
2017 - Frequency decreased about 5% for our PIP coverage, about 4% for our collision coverage, about 3% for our property damage coverage, and 2% for our bodily injury coverage.
|
($ in millions)
|
2019
|
2018
|
2017
|
||||||
ACTUARIAL ADJUSTMENTS
|
|
|
|
||||||
Reserve decrease (increase)
|
|
|
|
||||||
Prior accident years
|
$
|
(65.8
|
)
|
$
|
(25.0
|
)
|
$
|
138.5
|
|
Current accident year
|
(120.4
|
)
|
17.0
|
|
(19.8
|
)
|
|||
Calendar year actuarial adjustments
|
$
|
(186.2
|
)
|
$
|
(8.0
|
)
|
$
|
118.7
|
|
PRIOR ACCIDENT YEARS DEVELOPMENT
|
|
|
|
||||||
Favorable (unfavorable)
|
|
|
|
||||||
Actuarial adjustments
|
$
|
(65.8
|
)
|
$
|
(25.0
|
)
|
$
|
138.5
|
|
All other development
|
(166.5
|
)
|
(63.5
|
)
|
(164.4
|
)
|
|||
Total development
|
$
|
(232.3
|
)
|
$
|
(88.5
|
)
|
$
|
(25.9
|
)
|
(Increase) decrease to calendar year combined ratio
|
(0.6
|
) pts.
|
(0.3
|
) pts.
|
(0.1
|
) pts.
|
For the years ended December 31,
|
2019
|
|
2018
|
|
2017
|
||||||||||||
($ in millions)
|
$
|
% Growth
|
|
$
|
% Growth
|
|
$
|
% Growth
|
|||||||||
NET PREMIUMS WRITTEN
|
|
|
|
|
|
|
|
|
|||||||||
Personal Lines
|
|
|
|
|
|
|
|
|
|||||||||
Agency
|
$
|
15,336.5
|
|
13
|
%
|
|
$
|
13,562.3
|
|
16
|
%
|
|
$
|
11,685.4
|
|
16
|
%
|
Direct
|
15,765.7
|
|
16
|
|
|
13,595.3
|
|
21
|
|
|
11,243.0
|
|
16
|
|
|||
Total Personal Lines
|
31,102.2
|
|
15
|
|
|
27,157.6
|
|
18
|
|
|
22,928.4
|
|
16
|
|
|||
Commercial Lines
|
4,791.8
|
|
20
|
|
|
3,996.4
|
|
28
|
|
|
3,112.7
|
|
20
|
|
|||
Property
|
1,683.9
|
|
16
|
|
|
1,455.9
|
|
33
|
|
|
1,091.0
|
|
17
|
|
|||
Total underwriting operations
|
$
|
37,577.9
|
|
15
|
%
|
|
$
|
32,609.9
|
|
20
|
%
|
|
$
|
27,132.1
|
|
16
|
%
|
NET PREMIUMS EARNED
|
|
|
|
|
|
|
|
|
|||||||||
Personal Lines
|
|
|
|
|
|
|
|
|
|||||||||
Agency
|
$
|
14,904.1
|
|
14
|
%
|
|
$
|
13,017.2
|
|
16
|
%
|
|
$
|
11,177.6
|
|
14
|
%
|
Direct
|
15,305.9
|
|
18
|
|
|
13,017.5
|
|
21
|
|
|
10,769.6
|
|
15
|
|
|||
Total Personal Lines
|
30,210.0
|
|
16
|
|
|
26,034.7
|
|
19
|
|
|
21,947.2
|
|
14
|
|
|||
Commercial Lines
|
4,427.6
|
|
23
|
|
|
3,610.9
|
|
29
|
|
|
2,793.9
|
|
15
|
|
|||
Property
|
1,554.8
|
|
21
|
|
|
1,287.7
|
|
30
|
|
|
988.8
|
|
14
|
|
|||
Total underwriting operations
|
$
|
36,192.4
|
|
17
|
%
|
|
$
|
30,933.3
|
|
20
|
%
|
|
$
|
25,729.9
|
|
14
|
%
|
|
|
|
|
|
|
|
|
|
|||||||||
December 31,
|
2019
|
|
2018
|
|
2017
|
||||||||||||
(# in thousands)
|
#
|
% Growth
|
|
#
|
% Growth
|
|
#
|
% Growth
|
|||||||||
POLICIES IN FORCE
|
|
|
|
|
|
|
|
|
|||||||||
Agency auto
|
6,994.3
|
|
10
|
%
|
|
6,358.3
|
|
12
|
%
|
|
5,670.7
|
|
12
|
%
|
|||
Direct auto
|
7,866.5
|
|
12
|
|
|
7,018.5
|
|
16
|
|
|
6,039.1
|
|
13
|
|
|||
Total auto
|
14,860.8
|
|
11
|
|
|
13,376.8
|
|
14
|
|
|
11,709.8
|
|
13
|
|
|||
Special lines1
|
4,547.8
|
|
4
|
|
|
4,382.2
|
|
0
|
|
|
4,365.7
|
|
2
|
|
|||
Personal Lines - total
|
19,408.6
|
|
9
|
|
|
17,759.0
|
|
10
|
|
|
16,075.5
|
|
10
|
|
|||
Commercial Lines
|
751.4
|
|
8
|
|
|
696.9
|
|
8
|
|
|
646.8
|
|
6
|
|
|||
Property
|
2,202.1
|
|
14
|
|
|
1,936.5
|
|
32
|
|
|
1,461.7
|
|
22
|
|
|||
Companywide total
|
22,362.1
|
|
10
|
%
|
|
20,392.4
|
|
12
|
%
|
|
18,184.0
|
|
10
|
%
|
|
Growth Over Prior Year
|
|||||
|
2019
|
|
2018
|
|
2017
|
|
Applications
|
|
|
|
|||
New
|
8
|
%
|
17
|
%
|
15
|
%
|
Renewal
|
13
|
|
11
|
|
7
|
|
Written premium per policy - Auto
|
2
|
|
4
|
|
5
|
|
Policy life expectancy - Auto
|
|
|
|
|||
Trailing 3-months
|
0
|
|
(4
|
)
|
12
|
|
Trailing 12-months
|
0
|
|
3
|
|
7
|
|
|
Growth Over Prior Year
|
|||||
|
2019
|
|
2018
|
|
2017
|
|
Applications - Auto
|
|
|
|
|||
New
|
7
|
%
|
14
|
%
|
21
|
%
|
Renewal
|
12
|
|
12
|
|
7
|
|
Written premium per policy - Auto
|
3
|
|
5
|
|
6
|
|
Policy life expectancy - Auto
|
|
|
|
|||
Trailing 3-months
|
4
|
|
(2
|
)
|
14
|
|
Trailing 12-months
|
3
|
|
4
|
|
8
|
|
|
Growth Over Prior Year
|
|||||
|
2019
|
|
2018
|
|
2017
|
|
Applications - Auto
|
|
|
|
|||
New
|
9
|
%
|
25
|
%
|
16
|
%
|
Renewal
|
17
|
|
15
|
|
9
|
|
Written premium per policy - Auto
|
2
|
|
4
|
|
5
|
|
Policy life expectancy - Auto
|
|
|
|
|||
Trailing 3-months
|
(3
|
)
|
(5
|
)
|
10
|
|
Trailing 12-months
|
(3
|
)
|
1
|
|
4
|
|
|
Growth Over Prior Year
|
|||||
|
2019
|
|
2018
|
|
2017
|
|
Applications
|
|
|
|
|||
New
|
11
|
%
|
12
|
%
|
1
|
%
|
Renewal
|
9
|
|
6
|
|
8
|
|
Written premium per policy
|
8
|
|
14
|
|
12
|
|
Policy life expectancy
- trailing 12-months
|
(2
|
)
|
1
|
|
(4
|
)
|
|
Growth Over Prior Year
|
|||||
|
2019
|
|
2018
|
|
2017
|
|
Applications
|
|
|
|
|||
New
|
(1
|
)%
|
53
|
%
|
48
|
%
|
Renewal
|
22
|
|
25
|
|
16
|
|
Written premium per policy
|
2
|
|
(3
|
)
|
(5
|
)
|
|
2019
|
|
2018
|
|
2017
|
|
Pretax recurring investment book yield
|
3.1
|
%
|
2.8
|
%
|
2.4
|
%
|
Weighted average FTE book yield
|
3.1
|
|
2.9
|
|
2.6
|
|
FTE total return:
|
|
|
|
|||
Fixed-income securities
|
6.0
|
|
1.5
|
|
3.0
|
|
Common stocks
|
30.5
|
|
(4.4
|
)
|
21.8
|
|
Total portfolio
|
7.9
|
|
1.2
|
|
5.2
|
|
|
2019
|
|
2018
|
|
2017
|
|
Fixed-income securities:
|
|
|
|
|||
U.S. Treasury Notes
|
4.9
|
%
|
1.3
|
%
|
1.2
|
%
|
Municipal bonds
|
5.5
|
|
2.3
|
|
4.9
|
|
Corporate bonds
|
8.9
|
|
1.0
|
|
3.0
|
|
Residential mortgage-backed securities
|
3.3
|
|
2.7
|
|
4.7
|
|
Commercial mortgage-backed securities
|
6.2
|
|
2.1
|
|
4.0
|
|
Other asset-backed securities
|
3.4
|
|
2.2
|
|
1.8
|
|
Preferred stocks
|
13.8
|
|
(1.9
|
)
|
12.9
|
|
Short-term investments
|
2.4
|
|
2.0
|
|
1.2
|
|
Common stocks:
|
|
|
|
|||
Indexed
|
31.0
|
|
(4.1
|
)
|
22.7
|
|
Actively managed
|
22.6
|
|
(8.5
|
)
|
7.8
|
|
($ in millions)
|
Fair Value
|
|
% of Total Portfolio
|
|
Duration (years)
|
Rating1
|
|
2019
|
|
|
|
|
|||
U.S. government obligations
|
$
|
13,251.1
|
|
33.7
|
%
|
4.9
|
AAA
|
State and local government obligations
|
1,713.3
|
|
4.4
|
|
3.1
|
AA+
|
|
Corporate debt securities
|
7,067.7
|
|
18.0
|
|
2.7
|
BBB
|
|
Residential mortgage-backed securities
|
627.5
|
|
1.6
|
|
0.9
|
AA
|
|
Commercial mortgage-backed securities
|
5,076.2
|
|
12.9
|
|
2.0
|
AA
|
|
Other asset-backed securities
|
5,179.5
|
|
13.2
|
|
0.8
|
AAA-
|
|
Preferred stocks
|
1,233.9
|
|
3.2
|
|
2.6
|
BBB-
|
|
Short-term investments
|
1,798.8
|
|
4.6
|
|
0.1
|
AA-
|
|
Total fixed-income securities
|
35,948.0
|
|
91.6
|
|
3.0
|
AA
|
|
Common equities
|
3,306.3
|
|
8.4
|
|
na
|
na
|
|
Total portfolio2,3
|
$
|
39,254.3
|
|
100.0
|
%
|
3.0
|
AA
|
|
|
|
|
|
|||
2018
|
|
|
|
|
|||
U.S. government obligations
|
$
|
9,916.5
|
|
29.5
|
%
|
3.6
|
AAA
|
State and local government obligations
|
1,649.1
|
|
4.9
|
|
2.9
|
AA+
|
|
Corporate debt securities
|
8,694.3
|
|
25.9
|
|
3.3
|
BBB
|
|
Residential mortgage-backed securities
|
734.4
|
|
2.2
|
|
1.0
|
AA-
|
|
Commercial mortgage-backed securities
|
3,301.6
|
|
9.8
|
|
2.7
|
AA-
|
|
Other asset-backed securities
|
3,577.3
|
|
10.7
|
|
1.0
|
AA+
|
|
Preferred stocks
|
1,272.2
|
|
3.8
|
|
2.4
|
BBB-
|
|
Short-term investments
|
1,795.9
|
|
5.4
|
|
0.1
|
AA
|
|
Total fixed-income securities
|
30,941.3
|
|
92.2
|
|
2.8
|
AA-
|
|
Common equities
|
2,626.1
|
|
7.8
|
|
na
|
na
|
|
Total portfolio2,3
|
$
|
33,567.4
|
|
100.0
|
%
|
2.8
|
AA-
|
na = not applicable
|
|
|
|
|
•
|
common equities,
|
•
|
nonredeemable preferred stocks,
|
•
|
redeemable preferred stocks, except for 50% of investment-grade redeemable preferred stocks with cumulative dividends, which are included in Group II, and
|
•
|
all other non-investment-grade fixed-maturity securities.
|
•
|
short-term securities, and
|
•
|
all other fixed-maturity securities, including 50% of investment-grade redeemable preferred stocks with cumulative dividends.
|
|
2019
|
|
2018
|
||||||||
($ in millions)
|
Fair Value
|
|
% of Total Portfolio
|
|
|
Fair Value
|
|
% of Total Portfolio
|
|
||
Group I securities:
|
|
|
|
|
|
||||||
Non-investment-grade fixed maturities
|
$
|
327.2
|
|
0.8
|
%
|
|
$
|
754.8
|
|
2.2
|
%
|
Redeemable preferred stocks1
|
117.6
|
|
0.3
|
|
|
154.1
|
|
0.5
|
|
||
Nonredeemable preferred stocks
|
1,038.9
|
|
2.7
|
|
|
1,033.9
|
|
3.1
|
|
||
Common equities
|
3,306.3
|
|
8.4
|
|
|
2,626.1
|
|
7.8
|
|
||
Total Group I securities
|
4,790.0
|
|
12.2
|
|
|
4,568.9
|
|
13.6
|
|
||
Group II securities:
|
|
|
|
|
|
||||||
Other fixed maturities2
|
32,665.5
|
|
83.2
|
|
|
27,202.6
|
|
81.0
|
|
||
Short-term investments
|
1,798.8
|
|
4.6
|
|
|
1,795.9
|
|
5.4
|
|
||
Total Group II securities
|
34,464.3
|
|
87.8
|
|
|
28,998.5
|
|
86.4
|
|
||
Total portfolio
|
$
|
39,254.3
|
|
100.0
|
%
|
|
$
|
33,567.4
|
|
100.0
|
%
|
(millions)
|
Gross Holding Period Gains
|
|
Gross Holding Period Losses
|
|
Net Holding Period Gains (Losses)
|
|
|||
Balance at December 31, 2018
|
|
|
|
||||||
Hybrid fixed-maturity securities
|
$
|
0.1
|
|
$
|
(10.3
|
)
|
$
|
(10.2
|
)
|
Equity securities
|
1,568.7
|
|
(60.2
|
)
|
1,508.5
|
|
|||
Total holding period securities
|
1,568.8
|
|
(70.5
|
)
|
1,498.3
|
|
|||
Current year change in holding period securities
|
|
|
|
||||||
Hybrid fixed-maturity securities
|
7.7
|
|
10.3
|
|
18.0
|
|
|||
Equity securities
|
695.2
|
|
44.7
|
|
739.9
|
|
|||
Total changes in holding period securities
|
702.9
|
|
55.0
|
|
757.9
|
|
|||
Balance at December 31, 2019
|
|
|
|
||||||
Hybrid fixed-maturity securities
|
7.8
|
|
0
|
|
7.8
|
|
|||
Equity securities
|
2,263.9
|
|
(15.5
|
)
|
2,248.4
|
|
|||
Total holding period securities
|
$
|
2,271.7
|
|
$
|
(15.5
|
)
|
$
|
2,256.2
|
|
Rating
|
2019
|
|
2018
|
|
AAA
|
60.8
|
%
|
50.5
|
%
|
AA
|
9.9
|
|
10.8
|
|
A
|
7.9
|
|
8.4
|
|
BBB
|
19.5
|
|
25.9
|
|
Non-investment grade/non-rated:1
|
|
|
||
BB
|
1.4
|
|
3.0
|
|
B
|
0.3
|
|
1.1
|
|
CCC and lower
|
0
|
|
0.1
|
|
Non-rated
|
0.2
|
|
0.2
|
|
Total fixed-income portfolio
|
100.0
|
%
|
100.0
|
%
|
($ in millions)
|
Fair
Value
|
|
|
Duration
(years)
|
|
|
U.S. Treasury Notes
|
|
|
|
|||
Less than one year
|
$
|
100.3
|
|
|
0.5
|
|
One to two years
|
1,508.5
|
|
|
1.6
|
|
|
Two to three years
|
1,365.9
|
|
|
2.6
|
|
|
Three to five years
|
4,013.0
|
|
|
4.2
|
|
|
Five to seven years
|
4,466.7
|
|
|
6.1
|
|
|
Seven to ten years
|
1,796.7
|
|
|
8.7
|
|
|
Total U.S. Treasury Notes
|
$
|
13,251.1
|
|
|
4.9
|
|
($ in millions)
|
Fair
Value
|
|
Net Unrealized
Gains
(Losses)
|
|
% of Asset-
Backed
Securities
|
|
Duration
(years)
|
|
Rating
(at period end)1
|
||
2019
|
|
|
|
|
|
||||||
Residential mortgage-backed securities
|
$
|
627.5
|
|
$
|
2.5
|
|
5.8
|
%
|
0.9
|
|
AA
|
Commercial mortgage-backed securities
|
5,076.2
|
|
55.5
|
|
46.6
|
|
2.0
|
|
AA
|
||
Other asset-backed securities
|
5,179.5
|
|
14.8
|
|
47.6
|
|
0.8
|
|
AAA-
|
||
Total asset-backed securities
|
$
|
10,883.2
|
|
$
|
72.8
|
|
100.0
|
%
|
1.4
|
|
AA+
|
2018
|
|
|
|
|
|
||||||
Residential mortgage-backed securities
|
$
|
734.4
|
|
$
|
0.9
|
|
9.6
|
%
|
1.0
|
|
AA-
|
Commercial mortgage-backed securities
|
3,301.6
|
|
(31.2
|
)
|
43.4
|
|
2.7
|
|
AA-
|
||
Other asset-backed securities
|
3,577.3
|
|
(8.2
|
)
|
47.0
|
|
1.0
|
|
AA+
|
||
Total asset-backed securities
|
$
|
7,613.3
|
|
$
|
(38.5
|
)
|
100.0
|
%
|
1.7
|
|
AA
|
Other Asset-Backed Securities (at December 31, 2019)
|
||||||||||||||||||||
($ in millions)
Rating
|
Automobile
|
|
Credit Card
|
|
Student Loan
|
|
Whole Business Securitizations
|
|
Equipment
|
|
Total
|
|
% of
Total
|
|
||||||
AAA
|
$
|
2,219.1
|
|
$
|
857.9
|
|
$
|
325.0
|
|
$
|
0
|
|
$
|
1,076.0
|
|
$
|
4,478.0
|
|
86.4
|
%
|
AA
|
89.3
|
|
0
|
|
43.3
|
|
0
|
|
120.0
|
|
252.6
|
|
4.9
|
|
||||||
A
|
31.5
|
|
14.2
|
|
23.0
|
|
0
|
|
89.8
|
|
158.5
|
|
3.1
|
|
||||||
BBB
|
0
|
|
0
|
|
0
|
|
290.4
|
|
0
|
|
290.4
|
|
5.6
|
|
||||||
Total fair value
|
$
|
2,339.9
|
|
$
|
872.1
|
|
$
|
391.3
|
|
$
|
290.4
|
|
$
|
1,285.8
|
|
$
|
5,179.5
|
|
100.0
|
%
|
Increase (decrease) in value
|
0.2
|
%
|
0.1
|
%
|
0.4
|
%
|
1.2
|
%
|
0.2
|
%
|
0.3
|
%
|
|
Municipal Securities (at December 31, 2019)
|
|||||||||
(millions)
Rating
|
General
Obligations
|
|
Revenue
Bonds
|
|
Total
|
|
|||
AAA
|
$
|
451.2
|
|
$
|
346.3
|
|
$
|
797.5
|
|
AA
|
425.8
|
|
437.0
|
|
862.8
|
|
|||
A
|
0
|
|
43.9
|
|
43.9
|
|
|||
BBB
|
3.0
|
|
6.1
|
|
9.1
|
|
|||
Total
|
$
|
880.0
|
|
$
|
833.3
|
|
$
|
1,713.3
|
|
Corporate Securities (at December 31, 2019)
|
||||||||||||||||||||||||
(millions)
Rating |
Consumer
|
|
Industrial
|
|
Communication
|
|
Financial Services
|
|
Technology
|
|
Basic Materials
|
|
Energy
|
|
Total
|
|
||||||||
AAA
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
63.0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
0
|
|
$
|
63.0
|
|
AA
|
0
|
|
0
|
|
0
|
|
200.0
|
|
36.4
|
|
0
|
|
0
|
|
236.4
|
|
||||||||
A
|
242.5
|
|
176.5
|
|
232.0
|
|
680.4
|
|
142.8
|
|
4.1
|
|
0
|
|
1,478.3
|
|
||||||||
BBB
|
2,124.8
|
|
990.3
|
|
140.5
|
|
886.6
|
|
481.3
|
|
71.0
|
|
369.5
|
|
5,064.0
|
|
||||||||
Non-investment grade/non-rated:
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
BB
|
0
|
|
36.6
|
|
52.0
|
|
0
|
|
59.6
|
|
0
|
|
22.3
|
|
170.5
|
|
||||||||
B
|
31.3
|
|
0
|
|
0
|
|
0
|
|
0
|
|
0
|
|
24.2
|
|
55.5
|
|
||||||||
Total fair value
|
$
|
2,398.6
|
|
$
|
1,203.4
|
|
$
|
424.5
|
|
$
|
1,830.0
|
|
$
|
720.1
|
|
$
|
75.1
|
|
$
|
416.0
|
|
$
|
7,067.7
|
|
Preferred Stocks (at December 31, 2019)
|
|||||||||||||||||||||
|
Financial services
|
|
|
|
|||||||||||||||||
(millions)
Rating
|
U.S. Banks
|
|
Foreign Banks
|
|
Insurance
|
|
Other Financial
|
|
Industrials
|
|
Utilities
|
|
Total
|
|
|||||||
A
|
$
|
42.2
|
|
$
|
0
|
|
$
|
0
|
|
$
|
10.1
|
|
$
|
0
|
|
$
|
0
|
|
$
|
52.3
|
|
BBB
|
583.0
|
|
0
|
|
104.6
|
|
54.0
|
|
92.1
|
|
11.1
|
|
844.8
|
|
|||||||
Non-investment grade/non-rated:
|
|
|
|
|
|
|
|
||||||||||||||
BB
|
80.8
|
|
75.5
|
|
0
|
|
0
|
|
65.5
|
|
42.3
|
|
264.1
|
|
|||||||
B
|
0
|
|
0
|
|
0
|
|
29.6
|
|
0
|
|
0
|
|
29.6
|
|
|||||||
Non-rated
|
0
|
|
0
|
|
0
|
|
27.1
|
|
16.0
|
|
0
|
|
43.1
|
|
|||||||
Total fair value
|
$
|
706.0
|
|
$
|
75.5
|
|
$
|
104.6
|
|
$
|
120.8
|
|
$
|
173.6
|
|
$
|
53.4
|
|
$
|
1,233.9
|
|
($ in millions)
|
2019
|
|
2018
|
||||||||
Indexed common stocks
|
$
|
3,306.0
|
|
100.0
|
%
|
|
$
|
2,480.2
|
|
94.4
|
%
|
Managed common stocks
|
0
|
|
0
|
|
|
145.6
|
|
5.6
|
|
||
Total common stocks
|
3,306.0
|
|
100.0
|
|
|
2,625.8
|
|
100.0
|
|
||
Other risk investments
|
0.3
|
|
0
|
|
|
0.3
|
|
0
|
|
||
Total common equities
|
$
|
3,306.3
|
|
100.0
|
%
|
|
$
|
2,626.1
|
|
100.0
|
%
|
Sector
|
Equity Portfolio Allocation at December 31, 2019
|
|
Russell 1000 Allocation at December 31, 2019
|
|
Russell 1000 Sector Return in 2019
|
|
Consumer discretionary
|
14.9
|
%
|
15.7
|
%
|
29.2
|
%
|
Consumer staples
|
5.8
|
|
6.2
|
|
24.1
|
|
Financial services
|
19.5
|
|
20.1
|
|
33.7
|
|
Health care
|
12.8
|
|
13.0
|
|
21.5
|
|
Materials and processing
|
3.1
|
|
3.2
|
|
26.5
|
|
Other energy
|
3.9
|
|
4.0
|
|
10.7
|
|
Producer durable
|
9.9
|
|
9.6
|
|
30.8
|
|
Technology
|
25.3
|
|
23.1
|
|
47.2
|
|
Utilities
|
4.8
|
|
5.1
|
|
26.1
|
|
Total common stocks
|
100.0
|
%
|
100.0
|
%
|
31.4
|
%
|
|
Estimated Changes in Severity for Accident Year 2019
|
||||||||||||||
(millions)
|
-4%
|
|
-2%
|
|
As Reported
|
|
+2%
|
|
+4%
|
|
|||||
Personal auto liability
|
$
|
10,471.2
|
|
$
|
10,735.4
|
|
$
|
10,999.6
|
|
$
|
11,263.8
|
|
$
|
11,528.0
|
|
Commercial auto liability
|
3,146.4
|
|
3,192.4
|
|
3,238.4
|
|
3,284.4
|
|
3,330.4
|
|
|||||
Other1
|
655.2
|
|
655.2
|
|
655.2
|
|
655.2
|
|
655.2
|
|
|||||
Total
|
$
|
14,272.8
|
|
$
|
14,583.0
|
|
$
|
14,893.2
|
|
$
|
15,203.4
|
|
$
|
15,513.6
|
|
|
Estimated Changes in Severity for Accident Years 2019, 2018, and 2017
|
||||||||||||||
(millions)
|
-4%
|
|
-2%
|
|
As Reported
|
|
+2%
|
|
+4%
|
|
|||||
Personal auto liability
|
$
|
9,611.6
|
|
$
|
10,305.6
|
|
$
|
10,999.6
|
|
$
|
11,693.6
|
|
$
|
12,387.6
|
|
Commercial auto liability
|
3,009.2
|
|
3,123.8
|
|
3,238.4
|
|
3,353.0
|
|
3,467.6
|
|
|||||
Other1
|
655.2
|
|
655.2
|
|
655.2
|
|
655.2
|
|
655.2
|
|
|||||
Total
|
$
|
13,276.0
|
|
$
|
14,084.6
|
|
$
|
14,893.2
|
|
$
|
15,701.8
|
|
$
|
16,510.4
|
|
•
|
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;
|
•
|
the highly competitive nature of property-casualty insurance markets;
|
•
|
whether we innovate effectively and respond to our competitors’ initiatives;
|
•
|
whether we effectively manage complexity as we develop and deliver products and customer experiences;
|
•
|
how intellectual property rights could affect our competitiveness and our business operations;
|
•
|
whether we adjust claims accurately;
|
•
|
our ability to maintain a recognized and trusted brand;
|
•
|
our ability to attract, develop and retain talent and maintain appropriate staffing levels;
|
•
|
compliance with complex laws and regulations;
|
•
|
litigation challenging our business practices, and those of our competitors and other companies;
|
•
|
the impacts of a security breach or other attack involving our computer systems or the systems of one or more of our vendors;
|
•
|
the secure and uninterrupted operation of the facilities, systems and business functions that are critical to our business;
|
•
|
the success of our efforts to develop new products or enter into new areas of business and navigate related risks;
|
•
|
our continued ability to send and accept electronic payments;
|
•
|
the possible impairment of our goodwill or intangible assets;
|
•
|
the performance of our fixed-income and equity investment portfolios;
|
•
|
the potential elimination of, or change in, the London Interbank Offered Rate;
|
•
|
our continued ability to access our cash accounts and/or convert securities 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; 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, 2019.
|
(millions – except ratios, policies in force, per share
amounts, and number of people employed)
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
|||||
Net premiums written
|
$
|
37,577.9
|
|
$
|
32,609.9
|
|
$
|
27,132.1
|
|
$
|
23,353.5
|
|
$
|
20,564.0
|
|
Growth
|
15
|
%
|
20
|
%
|
16
|
%
|
14
|
%
|
10
|
%
|
|||||
Net premiums earned
|
$
|
36,192.4
|
|
$
|
30,933.3
|
|
$
|
25,729.9
|
|
$
|
22,474.0
|
|
$
|
19,899.1
|
|
Growth
|
17
|
%
|
20
|
%
|
14
|
%
|
13
|
%
|
8
|
%
|
|||||
Policies in force (thousands):
|
|
|
|
|
|
||||||||||
Personal Lines
|
19,408.6
|
|
17,759.0
|
|
16,075.5
|
|
14,656.8
|
|
13,764.7
|
|
|||||
Growth
|
9
|
%
|
10
|
%
|
10
|
%
|
6
|
%
|
4
|
%
|
|||||
Commercial Lines
|
751.4
|
|
696.9
|
|
646.8
|
|
607.9
|
|
555.8
|
|
|||||
Growth
|
8
|
%
|
8
|
%
|
6
|
%
|
9
|
%
|
8
|
%
|
|||||
Property1
|
2,202.1
|
|
1,936.5
|
|
1,461.7
|
|
1,201.9
|
|
1,076.5
|
|
|||||
Growth1
|
14
|
%
|
32
|
%
|
22
|
%
|
12
|
%
|
NM
|
|
|||||
Total revenues
|
$
|
39,022.3
|
|
$
|
31,979.0
|
|
$
|
26,839.0
|
|
$
|
23,441.4
|
|
$
|
20,853.8
|
|
Underwriting margins:2
|
|
|
|
|
|
||||||||||
Personal Lines
|
9.5
|
%
|
9.7
|
%
|
6.9
|
%
|
4.7
|
%
|
6.5
|
%
|
|||||
Commercial Lines
|
10.4
|
%
|
13.3
|
%
|
7.7
|
%
|
6.4
|
%
|
15.9
|
%
|
|||||
Property1
|
(1.7
|
)%
|
(6.9
|
)%
|
(5.1
|
)%
|
3.8
|
%
|
10.1
|
%
|
|||||
Total underwriting operations
|
9.1
|
%
|
9.4
|
%
|
6.6
|
%
|
4.9
|
%
|
7.5
|
%
|
|||||
Net income attributable to Progressive
|
$
|
3,970.3
|
|
$
|
2,615.3
|
|
$
|
1,592.2
|
|
$
|
1,031.0
|
|
$
|
1,267.6
|
|
Per common share - diluted
|
6.72
|
|
4.42
|
|
2.72
|
|
1.76
|
|
2.15
|
|
|||||
Average equivalent common shares - diluted
|
587.2
|
|
586.7
|
|
585.7
|
|
585.0
|
|
589.2
|
|
|||||
Comprehensive income attributable to Progressive
|
$
|
4,432.9
|
|
$
|
2,520.1
|
|
$
|
1,941.0
|
|
$
|
1,164.0
|
|
$
|
1,044.9
|
|
Total assets
|
$
|
54,895.3
|
|
$
|
46,575.0
|
|
$
|
38,701.2
|
|
$
|
33,427.5
|
|
$
|
29,819.3
|
|
Debt outstanding
|
4,407.1
|
|
4,404.9
|
|
3,306.3
|
|
3,148.2
|
|
2,707.9
|
|
|||||
Redeemable noncontrolling interest
|
225.6
|
|
214.5
|
|
503.7
|
|
483.7
|
|
464.9
|
|
|||||
Total shareholders’ equity
|
13,673.2
|
|
10,821.8
|
|
9,284.8
|
|
7,957.1
|
|
7,289.4
|
|
|||||
Statutory surplus
|
13,671.1
|
|
11,571.8
|
|
9,664.4
|
|
8,560.0
|
|
7,575.5
|
|
|||||
Common shares outstanding
|
584.6
|
|
583.2
|
|
581.7
|
|
579.9
|
|
583.6
|
|
|||||
Common share close price (at December 31)
|
$
|
72.39
|
|
$
|
60.33
|
|
$
|
56.32
|
|
$
|
35.50
|
|
$
|
31.80
|
|
Rate of return3
|
25.1
|
%
|
9.3
|
%
|
61.6
|
%
|
14.7
|
%
|
20.9
|
%
|
|||||
Market capitalization
|
$
|
42,319.2
|
|
$
|
35,184.5
|
|
$
|
32,761.3
|
|
$
|
20,586.5
|
|
$
|
18,558.5
|
|
Book value per common share
|
22.54
|
|
17.71
|
|
15.96
|
|
13.72
|
|
12.49
|
|
|||||
Ratios:
|
|
|
|
|
|
||||||||||
Return on average common shareholders’ equity:
|
|
|
|
|
|
||||||||||
Net income attributable to Progressive
|
31.3
|
%
|
24.7
|
%
|
17.8
|
%
|
13.2
|
%
|
17.2
|
%
|
|||||
Comprehensive income attributable to Progressive
|
35.0
|
%
|
23.8
|
%
|
21.7
|
%
|
14.9
|
%
|
14.2
|
%
|
|||||
Debt to total capital4
|
24.4
|
%
|
28.9
|
%
|
26.3
|
%
|
28.3
|
%
|
27.1
|
%
|
|||||
Price to earnings
|
10.8
|
|
13.6
|
|
20.7
|
|
20.2
|
|
14.8
|
|
|||||
Price to book
|
3.2
|
|
3.4
|
|
3.5
|
|
2.6
|
|
2.5
|
|
|||||
Net premiums written to statutory surplus
|
2.7
|
|
2.8
|
|
2.8
|
|
2.7
|
|
2.7
|
|
|||||
Statutory combined ratio
|
90.5
|
|
89.9
|
|
92.8
|
|
94.8
|
|
91.8
|
|
|||||
Dividends declared per common share5
|
$
|
2.65
|
|
$
|
2.5140
|
|
$
|
1.1247
|
|
$
|
0.6808
|
|
$
|
0.8882
|
|
Number of people employed
|
41,571
|
|
37,346
|
|
33,656
|
|
31,721
|
|
28,580
|
|
(millions – except ratios, policies in force, per share
amounts, and number of people employed)
|
2014
|
|
2013
|
|
2012
|
|
2011
|
|
2010
|
|
|||||
Net premiums written
|
$
|
18,654.6
|
|
$
|
17,339.7
|
|
$
|
16,372.7
|
|
$
|
15,146.6
|
|
$
|
14,476.8
|
|
Growth
|
8
|
%
|
6
|
%
|
8
|
%
|
5
|
%
|
3
|
%
|
|||||
Net premiums earned
|
$
|
18,398.5
|
|
$
|
17,103.4
|
|
$
|
16,018.0
|
|
$
|
14,902.8
|
|
$
|
14,314.8
|
|
Growth
|
8
|
%
|
7
|
%
|
7
|
%
|
4
|
%
|
2
|
%
|
|||||
Policies in force (thousands):
|
|
|
|
|
|
||||||||||
Personal Lines
|
13,261.9
|
|
13,056.4
|
|
12,735.3
|
|
12,283.8
|
|
11,702.7
|
|
|||||
Growth
|
2
|
%
|
3
|
%
|
4
|
%
|
5
|
%
|
7
|
%
|
|||||
Commercial Lines
|
514.7
|
|
514.6
|
|
519.6
|
|
509.1
|
|
510.4
|
|
|||||
Growth
|
0
|
%
|
(1
|
)%
|
2
|
%
|
0
|
%
|
0
|
%
|
|||||
Property1
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Growth1
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Total revenues
|
$
|
19,391.4
|
|
$
|
18,170.9
|
|
$
|
17,083.9
|
|
$
|
15,774.6
|
|
$
|
15,215.5
|
|
Underwriting margins:2
|
|
|
|
|
|
||||||||||
Personal Lines
|
6.7
|
%
|
6.6
|
%
|
4.4
|
%
|
6.8
|
%
|
7.0
|
%
|
|||||
Commercial Lines
|
17.2
|
%
|
6.5
|
%
|
5.2
|
%
|
9.1
|
%
|
12.5
|
%
|
|||||
Property1
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Total underwriting operations
|
7.7
|
%
|
6.5
|
%
|
4.4
|
%
|
7.0
|
%
|
7.6
|
%
|
|||||
Net income attributable to Progressive
|
$
|
1,281.0
|
|
$
|
1,165.4
|
|
$
|
902.3
|
|
$
|
1,015.5
|
|
$
|
1,068.3
|
|
Per common share - diluted
|
2.15
|
|
1.93
|
|
1.48
|
|
1.59
|
|
1.61
|
|
|||||
Average equivalent common shares - diluted
|
594.8
|
|
603.6
|
|
607.8
|
|
636.9
|
|
663.3
|
|
|||||
Comprehensive income attributable to Progressive
|
$
|
1,352.4
|
|
$
|
1,246.1
|
|
$
|
1,080.8
|
|
$
|
924.3
|
|
$
|
1,398.8
|
|
Total assets
|
$
|
25,787.6
|
|
$
|
24,408.2
|
|
$
|
22,694.7
|
|
$
|
21,844.8
|
|
$
|
21,150.3
|
|
Debt outstanding
|
2,164.7
|
|
1,860.9
|
|
2,063.1
|
|
2,442.1
|
|
1,958.2
|
|
|||||
Redeemable noncontrolling interest
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|||||
Total shareholders’ equity
|
6,928.6
|
|
6,189.5
|
|
6,007.0
|
|
5,806.7
|
|
6,048.9
|
|
|||||
Statutory surplus
|
6,442.8
|
|
5,991.0
|
|
5,605.2
|
|
5,269.2
|
|
5,073.0
|
|
|||||
Common shares outstanding
|
587.8
|
|
595.8
|
|
604.6
|
|
613.0
|
|
662.4
|
|
|||||
Common share close price (at December 31)
|
$
|
26.99
|
|
$
|
27.27
|
|
$
|
21.10
|
|
$
|
19.51
|
|
$
|
19.87
|
|
Rate of return3
|
5.3
|
%
|
30.9
|
%
|
15.4
|
%
|
0.2
|
%
|
16.9
|
%
|
|||||
Market capitalization
|
$
|
15,864.7
|
|
$
|
16,247.5
|
|
$
|
12,757.1
|
|
$
|
11,959.6
|
|
$
|
13,161.9
|
|
Book value per common share
|
11.79
|
|
10.39
|
|
9.94
|
|
9.47
|
|
9.13
|
|
|||||
Ratios:
|
|
|
|
|
|
||||||||||
Return on average common shareholders’ equity:
|
|
|
|
|
|
||||||||||
Net income attributable to Progressive
|
19.1
|
%
|
17.7
|
%
|
14.5
|
%
|
16.5
|
%
|
17.1
|
%
|
|||||
Comprehensive income attributable to Progressive
|
20.1
|
%
|
19.0
|
%
|
17.4
|
%
|
15.0
|
%
|
22.3
|
%
|
|||||
Debt to total capital4
|
23.8
|
%
|
23.1
|
%
|
25.6
|
%
|
29.6
|
%
|
24.5
|
%
|
|||||
Price to earnings
|
12.6
|
14.1
|
|
14.3
|
|
12.3
|
|
12.3
|
|
||||||
Price to book
|
2.3
|
|
2.6
|
|
2.1
|
|
2.1
|
|
2.2
|
|
|||||
Net premiums written to statutory surplus
|
2.9
|
|
2.9
|
|
2.9
|
|
2.9
|
|
2.9
|
|
|||||
Statutory combined ratio
|
92.1
|
|
93.4
|
|
95.2
|
|
92.9
|
|
92.5
|
|
|||||
Dividends declared per common share5
|
$
|
0.6862
|
|
$
|
1.4929
|
|
$
|
1.2845
|
|
$
|
0.4072
|
|
$
|
1.3987
|
|
Number of people employed
|
26,501
|
|
26,145
|
|
25,889
|
|
25,007
|
|
24,638
|
|
(millions – except per share amounts)
|
|
|
|
|
Stock Price1
|
|
||||||||||||||
Quarter
|
Total
Revenues
|
|
Net Income
|
|
Net Income Attributable to Progressive
|
|
Per Common Share2
|
|
|
Close
|
|
Rate of Return3
|
Dividends Declared Per Common Share3
|
|
||||||
2019
|
|
|
|
|
|
|
|
|
||||||||||||
1
|
$
|
9,300.0
|
|
$
|
1,082.8
|
|
$
|
1,078.4
|
|
$
|
1.83
|
|
|
$
|
72.09
|
|
|
$
|
0.10
|
|
2
|
9,450.7
|
|
979.0
|
|
979.4
|
|
1.66
|
|
|
79.93
|
|
|
0.10
|
|
||||||
3
|
9,530.5
|
|
843.6
|
|
841.7
|
|
1.42
|
|
|
77.25
|
|
|
0.10
|
|
||||||
4
|
10,741.1
|
|
1,074.6
|
|
1,070.8
|
|
1.81
|
|
|
72.39
|
|
|
2.35
|
|
||||||
|
$
|
39,022.3
|
|
$
|
3,980.0
|
|
$
|
3,970.3
|
|
$
|
6.72
|
|
|
$
|
72.39
|
|
25.1%
|
$
|
2.65
|
|
2018
|
|
|
|
|
|
|
|
|
||||||||||||
1
|
$
|
7,430.1
|
|
$
|
729.8
|
|
$
|
718.0
|
|
$
|
1.22
|
|
|
$
|
60.93
|
|
|
$
|
0
|
|
2
|
8,018.0
|
|
701.2
|
|
704.2
|
|
1.19
|
|
|
59.15
|
|
|
0
|
|
||||||
3
|
8,495.8
|
|
930.2
|
|
928.4
|
|
1.57
|
|
|
71.04
|
|
|
0
|
|
||||||
4
|
8,035.1
|
|
259.8
|
|
264.7
|
|
0.44
|
|
|
60.33
|
|
|
2.5140
|
|
||||||
|
$
|
31,979.0
|
|
$
|
2,621.0
|
|
$
|
2,615.3
|
|
$
|
4.42
|
|
|
$
|
60.33
|
|
9.3%
|
$
|
2.5140
|
|
2017
|
|
|
|
|
|
|
|
|
||||||||||||
1
|
$
|
6,321.7
|
|
$
|
430.3
|
|
$
|
424.3
|
|
$
|
0.73
|
|
|
$
|
39.18
|
|
|
$
|
0
|
|
2
|
6,605.7
|
|
372.7
|
|
367.6
|
|
0.63
|
|
|
44.09
|
|
|
0
|
|
||||||
3
|
6,791.8
|
|
214.8
|
|
224.0
|
|
0.38
|
|
|
48.42
|
|
|
0
|
|
||||||
4
|
7,119.8
|
|
580.3
|
|
576.3
|
|
0.98
|
|
|
56.32
|
|
|
1.1247
|
|
||||||
|
$
|
26,839.0
|
|
$
|
1,598.1
|
|
$
|
1,592.2
|
|
$
|
2.72
|
|
|
$
|
56.32
|
|
61.6%
|
$
|
1.1247
|
|
|
(Assumes $100 was invested at the close of trading on December 31, 2014)
|
||||||||||||||
For the years ended December 31,
|
2015
|
|
2016
|
|
2017
|
|
2018
|
|
2019
|
|
|||||
PGR
|
$
|
120.94
|
|
$
|
138.77
|
|
$
|
224.27
|
|
$
|
245.16
|
|
$
|
306.60
|
|
S&P Index
|
101.40
|
|
113.50
|
|
138.32
|
|
132.23
|
|
173.88
|
|
|||||
P/C Group1
|
111.02
|
|
131.30
|
|
164.96
|
|
163.88
|
|
208.60
|
|
|
Fair Value
|
||||||||||||||
|
-200 bps
|
|
-100 bps
|
|
|
+100 bps
|
|
+200 bps
|
|
||||||
(millions)
|
Change1
|
|
Change
|
|
Actual
|
|
Change
|
|
Change
|
|
|||||
U.S. government obligations
|
$
|
14,411.9
|
|
$
|
13,919.0
|
|
$
|
13,251.1
|
|
$
|
12,624.4
|
|
$
|
12,037.3
|
|
State and local government obligations
|
1,814.4
|
|
1,772.6
|
|
1,713.3
|
|
1,676.8
|
|
1,645.4
|
|
|||||
Asset-backed securities
|
11,175.8
|
|
11,040.9
|
|
10,883.2
|
|
10,725.5
|
|
10,567.8
|
|
|||||
Corporate securities
|
7,372.3
|
|
7,254.3
|
|
7,067.7
|
|
6,886.0
|
|
6,708.6
|
|
|||||
Preferred stocks
|
1,294.5
|
|
1,269.5
|
|
1,233.9
|
|
1,192.6
|
|
1,152.6
|
|
|||||
Short-term investments
|
1,800.3
|
|
1,799.7
|
|
1,798.8
|
|
1,797.9
|
|
1,796.9
|
|
|||||
Total at December 31, 2019
|
$
|
37,869.2
|
|
$
|
37,056.0
|
|
$
|
35,948.0
|
|
$
|
34,903.2
|
|
$
|
33,908.6
|
|
Total at December 31, 2018
|
$
|
32,694.8
|
|
$
|
31,805.1
|
|
$
|
30,941.3
|
|
$
|
30,107.5
|
|
$
|
29,306.8
|
|
|
Fair Value
|
||||||||
(millions)
|
-10%
|
|
Actual
|
|
+10%
|
|
|||
Common equities at December 31, 2019
|
$
|
2,975.7
|
|
$
|
3,306.3
|
|
$
|
3,636.9
|
|
Common equities at December 31, 2018
|
$
|
2,362.2
|
|
$
|
2,626.1
|
|
$
|
2,890.0
|
|
($ in millions)
|
|
2019
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
||||||||||||||||||||
Florida
|
|
$
|
5,233.4
|
|
13.9
|
%
|
|
$
|
4,700.9
|
|
14.4
|
%
|
|
$
|
3,808.0
|
|
14.0
|
%
|
|
$
|
3,305.1
|
|
14.1
|
%
|
|
$
|
2,839.6
|
|
13.8
|
%
|
Texas
|
|
4,081.0
|
|
10.8
|
|
|
3,388.6
|
|
10.4
|
|
|
2,704.9
|
|
10.0
|
|
|
2,226.8
|
|
9.5
|
|
|
1,941.5
|
|
9.4
|
|
|||||
California
|
|
2,208.8
|
|
5.9
|
|
|
1,836.0
|
|
5.6
|
|
|
1,520.5
|
|
5.6
|
|
|
1,284.8
|
|
5.5
|
|
|
1,173.6
|
|
5.7
|
|
|||||
New York
|
|
1,843.2
|
|
4.9
|
|
|
1,699.0
|
|
5.2
|
|
|
1,472.8
|
|
5.4
|
|
|
1,279.4
|
|
5.5
|
|
|
1,095.6
|
|
5.3
|
|
|||||
Michigan
|
|
1,673.5
|
|
4.4
|
|
|
1,423.7
|
|
4.4
|
|
|
1,186.8
|
|
4.4
|
|
|
971.3
|
|
4.2
|
|
|
812.5
|
|
4.0
|
|
|||||
Georgia
|
|
1,645.3
|
|
4.4
|
|
|
1,452.9
|
|
4.5
|
|
|
1,177.0
|
|
4.4
|
|
|
939.4
|
|
4.0
|
|
|
813.2
|
|
4.0
|
|
|||||
Ohio
|
|
1,339.5
|
|
3.6
|
|
|
1,194.0
|
|
3.7
|
|
|
1,033.5
|
|
3.8
|
|
|
905.2
|
|
3.9
|
|
|
820.8
|
|
4.0
|
|
|||||
Pennsylvania
|
|
1,268.3
|
|
3.4
|
|
|
1,157.4
|
|
3.5
|
|
|
1,005.5
|
|
3.7
|
|
|
895.8
|
|
3.8
|
|
|
787.3
|
|
3.8
|
|
|||||
New Jersey
|
|
1,192.3
|
|
3.2
|
|
|
1,088.1
|
|
3.3
|
|
|
985.8
|
|
3.6
|
|
|
902.8
|
|
3.9
|
|
|
820.2
|
|
4.0
|
|
|||||
Louisiana
|
|
965.6
|
|
2.6
|
|
|
856.5
|
|
2.6
|
|
|
739.2
|
|
2.7
|
|
|
694.7
|
|
3.0
|
|
|
614.9
|
|
3.0
|
|
|||||
All other
|
|
16,127.0
|
|
42.9
|
|
|
13,812.8
|
|
42.4
|
|
|
11,498.1
|
|
42.4
|
|
|
9,948.2
|
|
42.6
|
|
|
8,844.8
|
|
43.0
|
|
|||||
Total
|
|
$
|
37,577.9
|
|
100.0
|
%
|
|
$
|
32,609.9
|
|
100.0
|
%
|
|
$
|
27,132.1
|
|
100.0
|
%
|
|
$
|
23,353.5
|
|
100.0
|
%
|
|
$
|
20,564.0
|
|
100.0
|
%
|
Principal Office
|
The Progressive Corporation
|
6300 Wilson Mills Road
|
Mayfield Village, Ohio 44143
|
440-461-5000
|
progressive.com
|
|
Personal autos, motorcycles, recreational vehicles, homeowners, other property, and renters
|
Commercial autos/trucks, business property, and general liability
|
To receive a quote
|
1-800-PROGRESSIVE (1-800-776-4737) progressive.com
|
1-888-806-9598 progressivecommercial.com
|
To report a claim
|
1-800-PROGRESSIVE (1-800-776-4737)
progressive.com
|
1-800-PROGRESSIVE (1-800-776-4737)
|
For customer service:
|
|
|
If you bought your policy through an independent agent or broker
|
1-800-925-2886
(1-800-300-3693 in California) progressiveagent.com
|
1-800-444-4487 progressivecommercial.com
|
If you bought your policy directly through Progressive online or by phone
|
1-800-PROGRESSIVE (1-800-776-4737) progressive.com
|
1-800-895-2886 progressivecommercial.com
|
In addition, iPhone® and Android® users can download the Progressive App to start a quote, report a claim, or service a policy.
|
Annual Meeting The Annual Meeting of Shareholders will be held at the offices of The Progressive Corporation, Studio 96, 6671 Beta Drive, Mayfield Village, Ohio 44143 on May 8, 2020, at 10 a.m. eastern time. There were 1,965 shareholders of record on December 31, 2019.
|
|
Common Shares and Dividends The Progressive Corporation’s common shares are traded on the New York Stock Exchange (symbol PGR). Progressive currently has a dividend policy under which the Board expects to declare regular, quarterly common share dividends and, on at least an annual basis, to consider declaring an additional variable common share dividend. The dividend policy can be found at: progressive.com/dividend.
|
|
Shareholder/Investor Relations Progressive does not maintain a mailing list for distribution of shareholders’ reports. To view Progressive’s publicly filed documents, shareholders can access our website: progressive.com/sec. To view our earnings and other releases, access: progressive.com/financial-releases.
|
|
For financial-related information or to request copies of Progressive’s publicly filed documents free of charge, write to: The Progressive Corporation, Investor Relations, 6300 Wilson Mills Road, Box W33, Mayfield Village, Ohio 44143, email: investor_relations@progressive.com, or call: 440-395-2222.
|
|
For all other company information, call: 440-461-5000 or access our website at: progressive.com/contactus.
|
Transfer Agent and Registrar
|
Registered Shareholders: If you have questions or changes to your account and your Progressive common shares are registered in your name, write to: American Stock Transfer & Trust Company, Attn: Operations Center, 6201 15th Avenue, Brooklyn, NY 11219; phone: 1-866-709-7695; email: info@astfinancial.com; or visit their website at: astfinancial.com.
|
|
Beneficial Shareholders: If your Progressive common shares are held in a brokerage or other financial institution account, contact your broker or financial institution directly regarding questions or changes to your account.
|
|
Contact Non-Management Directors Interested parties have the ability to contact the non-management directors as a group by sending a written communication clearly addressed to the non-management directors to either of the following:
|
|
Lawton W. Fitt, Chairperson of the Board, The Progressive Corporation, email: chair@progressive.com; or
|
|
Daniel P. Mascaro, Secretary, The Progressive Corporation, 6300 Wilson Mills Road, Mayfield Village, Ohio 44143 or email: secretary@progressive.com.
|
|
The recipient will forward communications so received to the non-management directors.
|
|
Accounting Complaint Procedure Any employee or other interested party with a complaint or concern regarding accounting, internal accounting controls, or auditing matters relating to Progressive may report such complaint or concern directly to the Chairperson of the Audit Committee, as follows: Patrick H. Nettles, Ph.D., Chair of the Audit Committee, auditchair@progressive.com.
|
|
Any such complaint or concern also may be reported anonymously over the following toll-free Alert Line: 1-800-683-3604 or online at: www.progressivealertline.com. Progressive will not retaliate against any individual by reason of his or her having made such a complaint or reported such a concern in good faith. View the complete procedures at: progressive.com/governance.
|
|
Whistleblower Protections Progressive will not retaliate against any officer or employee of Progressive because of any lawful act done by the officer or employee to provide information or otherwise assist in investigations regarding conduct that the officer or employee reasonably believes to be a violation of federal securities laws or of any rule or regulation of the Securities and Exchange Commission. View the complete Whistleblower Protections at: progressive.com/governance.
|
|
Corporate Governance Progressive’s Corporate Governance Guidelines and Board Committee Charters are available at: progressive.com/governance and progressive.com/committee-charters, respectively.
|
|
Counsel Baker & Hostetler LLP, Cleveland, Ohio
|
|
Charitable Contributions We contribute annually to: (i) The Insurance Institute for Highway Safety to further its work in reducing the human trauma and economic costs of auto accidents; and (ii) The Progressive Insurance Foundation, which provides matching funds to eligible 501(c)(3) charitable organizations to which employees contribute. Over the last five years, the matching funds provided by The Progressive Insurance Foundation averaged approximately $4 million per year. In 2019, we entered into a financial partnership with Humble Design, a Detroit-based nonprofit organization that furnishes homes for families and veterans transitioning from homelessness.
|
|
Social Responsibility and Sustainability Progressive uses an interactive online format to communicate our social responsibility efforts. This report can be found at: progressive.com/socialresponsibility.
|
|
Online Annual Report and Proxy Statement Our 2019 Annual Report to Shareholders can be found at: progressive.com/annualreport.
|
|
Our 2020 Proxy Statement and 2019 Annual Report to Shareholders, in a PDF format, can be found at: progressiveproxy.com.
|
Directors
|
|
|
|
|
Philip Bleser3,5,6
|
|
Roger N. Farah2,3,5,6
|
|
Patrick H. Nettles, Ph.D.1,6
|
Retired Chairman of Global Corporate
|
|
Former Executive Director,
|
|
Executive Chairman,
|
Banking,
|
|
Tory Burch LLC
|
|
Ciena Corporation
|
J. P. Morgan Chase & Co.
|
|
(retailing)
|
|
(telecommunications)
|
(financial services)
|
|
|
|
|
|
|
|
|
|
Stuart B. Burgdoerfer1,6
|
|
Lawton W. Fitt2,4,5,6
|
|
Barbara R. Snyder3,6
|
Executive Vice President and
|
|
Chairperson of the Board,
|
|
President,
|
Chief Financial Officer,
|
|
Retired Partner,
|
|
Case Western Reserve University
|
L Brands, Inc.
|
|
Goldman Sachs Group
|
|
(higher education)
|
(retailing)
|
|
(financial services)
|
|
|
|
|
|
|
|
Pamela J. Craig3,6
|
|
Susan Patricia Griffith2
|
|
Jan E. Tighe6
|
Retired Chief Financial Officer,
|
|
President and Chief Executive Officer,
|
|
United States Navy, Vice Admiral, Retired
|
Accenture PLC
|
|
The Progressive Corporation
|
|
(military)
|
(global management consulting)
|
|
|
|
|
|
|
|
|
|
Charles A. Davis4,6
|
|
Jeffrey D. Kelly1,6
|
|
Kahina Van Dyke4,6
|
Chief Executive Officer,
|
|
Retired Chief Operating Officer and
|
|
Global Head, Digital Channels and
|
Stone Point Capital LLC
|
|
Chief Financial Officer,
|
|
Client Data Analytics,
|
(private equity investing)
|
|
RenaissanceRe Holdings Ltd.
|
|
Standard Chartered PLC
|
|
|
(reinsurance services)
|
|
(international banking)
|
|
|
|
|
|
|
|
|
|
|
1 Audit Committee Member
|
|
|
|
|
2 Executive Committee Member
|
|
|
|
|
3 Compensation Committee Member
|
|
|
|
|
4 Investment and Capital Committee
|
|
|
|
|
Member
|
|
|
|
|
5 Nominating and Governance
|
|
|
|
|
Committee Member
|
|
|
|
|
6 Independent Director
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Corporate Officers
|
|
Other Executive Officers
|
|
|
Lawton W. Fitt
|
|
John A. Barbagallo
|
|
|
Chairperson of the Board
|
|
Commercial Lines President
|
|
|
(non-executive)
|
|
|
|
|
|
|
Jonathan S. Bauer
|
|
|
Susan Patricia Griffith
|
|
Chief Investment Officer
|
|
|
President
|
|
|
|
|
and Chief Executive Officer
|
|
Steven A. Broz
|
|
|
|
|
Chief Information Officer
|
|
|
John P. Sauerland
|
|
|
|
|
Vice President
|
|
Patrick K. Callahan
|
|
|
and Chief Financial Officer
|
|
Personal Lines President
|
|
|
|
|
|
|
|
Daniel P. Mascaro
|
|
M. Jeffrey Charney
|
|
|
Vice President, Secretary,
|
|
Chief Marketing Officer
|
|
|
and Chief Legal Officer
|
|
|
|
|
|
|
John Murphy
|
|
|
Patrick S. Brennan
|
|
Customer Relationship Management
|
|
|
Treasurer
|
|
President
|
|
|
|
|
|
|
|
Mariann Wojtkun Marshall
|
|
Lori Niederst
|
|
|
Vice President, Assistant Secretary,
|
|
Chief Human Resource Officer
|
|
|
and Chief Accounting Officer
|
|
|
|
|
|
|
Andrew J. Quigg
|
|
|
|
|
Chief Strategy Officer
|
|
|
|
|
|
|
|
|
|
Michael D. Sieger
|
|
|
|
|
Claims President
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
©2020 The Progressive Corporation
|
|
|
Jurisdiction
|
Name of Subsidiary
|
|
of Incorporation
|
ARX Holding Corp. (owns 87.1% of outstanding capital stock)
|
|
Delaware
|
American Strategic Insurance Corp.
|
|
Florida
|
Ark Royal Underwriters, LLC
|
|
Florida
|
ASI Assurance Corp.
|
|
Florida
|
ASI Home Insurance Corp.
|
|
Florida
|
ASI Lloyds, Inc.
|
|
Texas
|
ASI Preferred Insurance, Corp.*
|
|
Florida
|
ASI Select Auto Insurance Corp.
|
|
California
|
ASI Select Insurance Corp.
|
|
Delaware
|
ASI Services, Inc.
|
|
Florida
|
ASI Underwriters Corp.
|
|
Florida
|
ASI Underwriters of Texas, Inc.
|
|
Texas
|
e-Ins. LLC*
|
|
Florida
|
Progressive Property Insurance Company
|
|
Florida
|
PropertyPlus Insurance Agency, Inc.
|
|
Delaware
|
Sunshine Security Insurance Agency, Inc.
|
|
Florida
|
Drive Insurance Holdings, Inc.
|
|
Delaware
|
Drive New Jersey Insurance Company
|
|
New Jersey
|
Progressive American Insurance Company
|
|
Ohio
|
Progressive Bayside Insurance Company
|
|
Ohio
|
Progressive Casualty Insurance Company
|
|
Ohio
|
PC Investment Company
|
|
Delaware
|
Progressive Gulf Insurance Company
|
|
Ohio
|
Progressive Specialty Insurance Company
|
|
Ohio
|
Trussville/Cahaba, AL, LLC
|
|
Ohio
|
Progressive Classic Insurance Company
|
|
Wisconsin
|
Progressive Commercial Advantage Agency, Inc.
|
|
Ohio
|
Progressive Commercial Casualty Company
|
|
Ohio
|
Progressive Freedom Insurance Company
|
|
Ohio
|
Progressive Hawaii Insurance Corp.
|
|
Ohio
|
Progressive Michigan Insurance Company
|
|
Michigan
|
Progressive Mountain Insurance Company
|
|
Ohio
|
Progressive Northern Insurance Company
|
|
Wisconsin
|
Progressive Northwestern Insurance Company
|
|
Ohio
|
Progressive Preferred Insurance Company
|
|
Ohio
|
Progressive Security Insurance Company
|
|
Louisiana
|
Progressive Southeastern Insurance Company
|
|
Indiana
|
Progressive West Insurance Company
|
|
Ohio
|
Garden Sun Insurance Services, Inc.
|
|
Hawaii
|
Pacific Motor Club
|
|
California
|
|
|
|
*Wholly owned by ARX Holding Corp.; however, ownership is shared by one or more ARX Holding Corp. subsidiary. Subsidiary is reported under the majority owned parent.
|
|
|
Jurisdiction
|
Name of Subsidiary
|
|
of Incorporation
|
Progny Agency, Inc.
|
|
New York
|
Progressive Adjusting Company, Inc.
|
|
Ohio
|
Progressive Capital Management Corp.
|
|
New York
|
Progressive Commercial Holdings, Inc.
|
|
Delaware
|
Artisan and Truckers Casualty Company
|
|
Wisconsin
|
Blue Hill Specialty Insurance Company, Inc.
|
|
Illinois
|
National Continental Insurance Company
|
|
New York
|
Progressive Express Insurance Company
|
|
Ohio
|
United Financial Casualty Company
|
|
Ohio
|
Progressive Direct Holdings, Inc.
|
|
Delaware
|
Mountain Laurel Assurance Company
|
|
Ohio
|
Progressive Advanced Insurance Company
|
|
Ohio
|
Progressive Advantage Agency, Inc.
|
|
Ohio
|
Progressive Auto Pro Insurance Agency, Inc.
|
|
Florida
|
Progressive Choice Insurance Company
|
|
Ohio
|
Progressive Direct Insurance Company
|
|
Ohio
|
Gadsden, AL, LLC
|
|
Ohio
|
Progressive Garden State Insurance Company
|
|
New Jersey
|
Progressive Marathon Insurance Company
|
|
Michigan
|
Progressive Max Insurance Company
|
|
Ohio
|
Progressive Paloverde Insurance Company
|
|
Indiana
|
Progressive Premier Insurance Company of Illinois
|
|
Ohio
|
Progressive Select Insurance Company
|
|
Ohio
|
Progressive Universal Insurance Company
|
|
Wisconsin
|
Progressive Investment Company, Inc.
|
|
Delaware
|
Progressive Premium Budget, Inc.
|
|
Ohio
|
Progressive RSC, Inc.
|
|
Ohio
|
Progressive Vehicle Service Company
|
|
Ohio
|
Village Transport Corp.
|
|
Delaware
|
Wilson Mills Land Co.
|
|
Ohio
|
358 Ventures, Inc.
|
|
Ohio
|
1.
|
I have reviewed this annual report on Form 10-K of The Progressive Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
|
|
Date:
|
March 2, 2020
|
/s/ Susan Patricia Griffith
|
|
|
Susan Patricia Griffith
|
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this annual report on Form 10-K of The Progressive Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
|
|
|
|
|
|
Date:
|
March 2, 2020
|
/s/ John P. Sauerland
|
|
|
John P. Sauerland
|
|
|
Vice President and Chief Financial Officer
|
|
|
/s/ Susan Patricia Griffith
|
Susan Patricia Griffith
|
President and Chief Executive Officer
|
March 2, 2020
|
|
|
/s/ John P. Sauerland
|
John P. Sauerland
|
Vice President and Chief Financial Officer
|
March 2, 2020
|