Progressive Insurance

Lines of Insurance:
Auto

States licensed to sell insurance in:
AL, AK, AZ, AR, CA, CO, CT, DE, DC, FL, GA, HI, ID, IL, IN, IA, KS, KY, LA, ME, MD, MI, MN, MS, MO, MT, NE, NV, NH, NJ, NM, NY, NC, ND, OH, OK, OR, PA, RI, SC, SD, TN, TX, UT, VT, VA, WA, WV, WI, WY

Type of Insurance Company: Stock

Name of Parent Company:
The Progressive Group of Insurance Companies

Insurance subsidiaries:
Progressive Direct
Progressive Drive Insurance

Company Overview:

Company History: Progressive, known for its innovative commercials with a snarky lady named Flo pitching auto insurance,  was founded in 1937 as Progressive Mutual Insurance Company. In 1956, they launched Progressive Casualty Insurance Company which was focused on writing auto insurance for high-drivers. Today, Progressive is able to write insurance for all types of drivers.

Progressive operates through a publicly traded holding company, Progressive Corporation, which was formed in 1965, and currently has 67 subsidiaries and 1 mutual insurance company affiliate. Today the company has over 27,000 employees.

Progressive’s insurance subsidiaries and affiliates provide personal and commercial automobile insurance as well as other specialty property-casualty insurance and related services throughout the United States. Progressive’s property-casualty insurance products protect its customers against collision and physical damage to their motor vehicles, uninsured and underinsured bodily injury, and liability to others for personal injury or property damage arising out of vehicle accidents. In addition to private passenger automobile coverage, Progressive writes recreational vehicle, mobile home, non-standard commercial vehicle and credit-related insurance. In 2006 the 6 primary states from which Progressive derived premiums were Florida (12.8%), Texas (7.8%), New York (6.6%), California (7.7%), Georgia (5.3%) and Ohio (4.9%). Other states accounted for the additional 54.9%.

Principal Methods: Progressive is an Auto Insurance company that has expanded their offerings to include other “vehicles” like motorcycles, RV’s, boats/PWC, snowmobiles and Segway and other “toys”. The company distributes insurance directly to consumers via it’s callcenters and the Internet. As can be expected of an innovative company, Progressive was one of the first insurance companies to embrace and pursue Internet distribution of insurance. Progressive also distributes insurance through a network of over 30,000 independent agents.

Auto Business: Progressive is currently the third largest auto insurance company in the U.S. growing at about 17% per year from 1996 thru 2005 reaching total Auto Insurance Revenues of $14 Billion. Progressive is known for innovative claims, distribution, and marketing practices.

The personal lines segment of Progressive’s business writes insurance for private passenger automobiles and recreational and other vehicles. This business generally targets its insurance products in a given state to a specific distribution channel, market or customer group. The personal lines businesses accounted for 86% of total net premiums written in 2006. Progressive has stated that its strategy is to be the low-cost provider of a full line of auto insurance products with superior service, distributed through which ever distribution channel the customer prefers. Progressive ranked third in industry market share for 2005 based on net premiums written. The company competes with approximately 280 other insurance companies/groups that each writes over $5 million of private passenger auto insurance premiums annually in the United States. The top 15 private passenger auto insurers comprised about 75% of this market. For 2006, the estimated industry net premiums written for personal auto insurance in the United States was $161.1 billion, and Progressive’s share of this market was approximately 7.6%.

Private passenger automobile insurance represented 91% of total personal lines net premiums written by Progressive in 2006. Specialty personal lines products include insurance for motorcycles, recreational vehicles, mobile homes, watercraft, snowmobiles and similar items. These products represented 9% of the total personal lines net premiums written and are primarily distributed by independent agents and brokers. Progressive claims to have been the market share leader for personal watercraft insurance and for motorcycle insurance for at least the last 5 years. A personal umbrella insurance product is offered in select markets in 5 states through certain independent agents as a pilot program. Personal lines business is generated either by independent agents and brokers or written directly online or by phone. The agency network consists of more than 30,000 independent insurance agencies located throughout the United States, as well as 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 company-mandated procedures. The agency business also writes business through strategic alliance business relationships with other insurance companies, financial institutions and national brokerage agencies. In 2006, the total net premiums written through the agency business represented 64% of the personal lines volume. The direct business includes business written directly online and over the phone.

Homeowners Business: Progressive Direct recently started working with Homesite and Liberty Mutual insurance companies to offer Progressive Direct auto insurance customers, the ability to purchase homeowners, condominium and renters insurance.

Special Business: Boats, RV’s, Motorcyles Insurance, Persoanl Water Craft Insurance, even Segways.

Company Rating:
Best Insurance Reports: A+
Url of page rating was collected: http://investors.progressive.com/ratings.asp
Best Rating: AM Best has rated Progressive’s Financial Strength – A+ and Progressive’s
Debt Rating – a

Company Financial Information:
Ticker Symbol: PGR

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