| Statement Of Income Insurance Based Revenue (USD $) | |||||||||||||||||||
| In Millions, except Per Share data | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 | |||||||||||||||
| Revenues | |||||||||||||||||||
| Net premiums earned | 3441.4 | 3411.2 | $6,848 | 6801.2 | |||||||||||||||
| Investment income | 122.1 | 165.8 | 253.6 | 325.1 | |||||||||||||||
| Other-than-temporary impairment (OTI) losses: | |||||||||||||||||||
| Total OTI losses | -53.8 | 0 | -53.8 | 0 | |||||||||||||||
| Less: portion of OTI losses recognized in other comprehensive income | 23.8 | 0 | 23.8 | 0 | |||||||||||||||
| Net impairment losses recognized in earnings | (30) | 0 | (30) | 0 | |||||||||||||||
| Net realized gains (losses) on securities | 45.9 | -44.6 | -27.5 | -12.4 | |||||||||||||||
| Total net realized gains (losses) on securities | 15.9 | -44.6 | -57.5 | -12.4 | |||||||||||||||
| Service revenues | 4.1 | 4.2 | 7.6 | 8.6 | |||||||||||||||
| Total revenues | 3583.5 | 3536.6 | 7051.7 | 7122.5 | |||||||||||||||
| Expenses | |||||||||||||||||||
| Losses and loss adjustment expenses | 2462.6 | 2471.3 | 4799.6 | 4955.3 | |||||||||||||||
| Policy acquisition costs | 334.1 | 340.7 | 670.3 | 680.2 | |||||||||||||||
| Other underwriting expenses | 390.9 | 379.5 | 768.3 | 763.8 | |||||||||||||||
| Investment expenses | 2.6 | 2.9 | 5.2 | 4.4 | |||||||||||||||
| Service expenses | 4.7 | 5.4 | 9.3 | 10.5 | |||||||||||||||
| Interest expense | 34.7 | 34.3 | 68.4 | 68.6 | |||||||||||||||
| Total expenses | 3229.6 | 3234.1 | 6321.1 | 6482.8 | |||||||||||||||
| Net Income | |||||||||||||||||||
| Income before income taxes | 353.9 | 302.5 | 730.6 | 639.7 | |||||||||||||||
| Provision for income taxes | 103.8 | 87 | 248 | 184.8 | |||||||||||||||
| Net income | 250.1 | 215.5 | 482.6 | 454.9 | |||||||||||||||
| Basic: | |||||||||||||||||||
| Average shares outstanding | 669.2 | 667.4 | 668.9 | 669.5 | |||||||||||||||
| Per share | 0.37 | 0.32 | 0.72 | 0.68 | |||||||||||||||
| Diluted: | |||||||||||||||||||
| Average shares outstanding | 669.2 | 667.4 | 668.9 | 669.5 | |||||||||||||||
| Net effect of dilutive stock-based compensation | 5.4 | 6.3 | 4.4 | 6 | |||||||||||||||
| Total equivalent shares | 674.6 | 673.7 | 673.3 | 675.5 | |||||||||||||||
| Per share | 0.37 | 0.32 | 0.72 | 0.67 | |||||||||||||||
| Dividends declared per share | $0 | [1] | $0 | [1] | $0 | [1] | $0 | [1] | |||||||||||
| [1]Progressive maintains an annual dividend program. See Note 9 - Dividends for further discussion. | |||||||||||||||||||
| Statement Of Financial Position, Unclassified - Insurance Based Operations (USD $) | |||||||||||||||||||
| In Millions | Jun. 30, 2009
| Dec. 31, 2008
| Jun. 30, 2008
| ||||||||||||||||
| Investments - Available-for-sale, at fair value: | |||||||||||||||||||
| Fixed maturities (amortized cost: $11,453.9, $9,406.2, and $10,295.3) | 10935.3 | 9946.7 | 9212.9 | ||||||||||||||||
| Equity securities: | |||||||||||||||||||
| Nonredeemable preferred stocks (cost: $810.4, $2,741.8, and $1,131.3) | 1130.1 | 1,150 | 2210.5 | ||||||||||||||||
| Common equities (cost: $292.4, $1,310.8, and $553.6) | 408.7 | 727.8 | 2039.4 | ||||||||||||||||
| Short-term investments (amortized cost: $1,137.2, $513.2, and $1,153.6) | 1137.2 | 1153.6 | 513.2 | ||||||||||||||||
| Total investments | 13611.3 | 12978.1 | 13,976 | ||||||||||||||||
| Cash | 160.7 | 2.9 | 9.9 | ||||||||||||||||
| Accrued investment income | 113.7 | 125.7 | 123.1 | ||||||||||||||||
| Premiums receivable, net of allowance for doubtful accounts of $103.5, $99.0, and $113.7 | 2,545 | 2408.6 | 2515.5 | ||||||||||||||||
| Reinsurance recoverables, including $40.9, $42.5, and $44.0 on paid losses | 288.7 | 288.5 | 308.6 | ||||||||||||||||
| Prepaid reinsurance premiums | 62.6 | 62.4 | 63.1 | ||||||||||||||||
| Deferred acquisition costs | 436.3 | 414 | 446.2 | ||||||||||||||||
| Income taxes | 727.6 | 821.6 | 291.2 | ||||||||||||||||
| Property and equipment, net of accumulated depreciation of $591.4, $636.0, and $653.6 | 989.9 | 997.1 | 1002.7 | ||||||||||||||||
| Other assets | 151.8 | 151.6 | 178.1 | ||||||||||||||||
| Total assets | 19087.6 | 18250.5 | 18914.4 | ||||||||||||||||
| Liabilities and Shareholders' Equity | |||||||||||||||||||
| Unearned premiums | 4379.6 | 4175.9 | 4403.6 | ||||||||||||||||
| Loss and loss adjustment expense reserves | 6198.9 | 6177.4 | 6000.6 | ||||||||||||||||
| Accounts payable, accrued expenses, and other liabilities | 1407.7 | 1506.4 | 1,530 | ||||||||||||||||
| Debt | 2176.4 | [1] | 2175.5 | [1] | 2174.7 | [1] | |||||||||||||
| Total liabilities | 14162.6 | 14035.2 | 14108.9 | ||||||||||||||||
| Common Shares, $1.00 par value (authorized 900.0; issued 797.8, 797.9, and 797.9, including treasury shares of 117.8, 122.5, and 121.4) | 680 | 676.5 | 675.4 | ||||||||||||||||
| Paid-in capital | 914.2 | 892.9 | 863.6 | ||||||||||||||||
| Accumulated other comprehensive income (loss): | |||||||||||||||||||
| Net unrealized gains (losses) on securities | -30.9 | -76.8 | 15.4 | ||||||||||||||||
| Portion of OTI losses recognized in other comprehensive income | -15.5 | 0 | 0 | ||||||||||||||||
| Total net unrealized gains (losses) on securities | -46.4 | -76.8 | 15.4 | ||||||||||||||||
| Net unrealized gains on forecasted transactions | 23.9 | 24.9 | 26.3 | ||||||||||||||||
| Retained earnings | 3353.3 | 2697.8 | 3224.8 | ||||||||||||||||
| Total shareholders' equity | 4,925 | 4215.3 | 4805.5 | ||||||||||||||||
| Total liabilities and shareholders' equity | 19087.6 | 18250.5 | 18914.4 | ||||||||||||||||
| [1]Consists of long-term debt. See Note 4 - Debt. | |||||||||||||||||||
| Statement Of Financial Position, Unclassified - Insurance Based Operations (Parenthetical) (USD $) | |||
| In Millions, except Per Share data | Jun. 30, 2009
| Dec. 31, 2008
| Jun. 30, 2008
|
| Fixed maturities, amortized cost | 11453.9 | 10295.3 | 9406.2 |
| Nonredeemable preferred stocks, cost | 810.4 | 1131.3 | 2741.8 |
| Common equities, cost | 292.4 | 553.6 | 1310.8 |
| Short-term investments, amortized cost | 1137.2 | 1153.6 | 513.2 |
| Premiums receivable, allowance for doubtful accounts | 103.5 | 113.7 | 99 |
| Reinsurance recoverables, paid losses | 40.9 | 44 | 42.5 |
| Property and equipment, accumulated depreciation | 591.4 | 653.6 | $636 |
| Common Shares, par value | $1 | $1 | $1 |
| Common Shares, authorized | 900 | 900 | 900 |
| Common Shares, issued | 797.8 | 797.9 | 797.9 |
| Common Shares, treasury shares | 117.8 | 121.4 | 122.5 |
| Statement Of Shareholders Equity And Other Comprehensive Income (USD $) | |||||||||||||||||||
| In Millions | Retained Earnings
| Accumulated Other Comprehensive Income (Loss), Net of Tax
| Paid-In Capital
| Total
| |||||||||||||||
| Balance, Beginning of year at Dec. 31, 2007 | 2927.7 | 492.8 | 680.2 | 834.8 | |||||||||||||||
| Stock options exercised | 2.3 | 16.5 | |||||||||||||||||
| Cumulative effect of change in accounting principle | 0 | [2] | 0 | [2] | |||||||||||||||
| Tax benefits from exercise/vesting of stock-based compensation | 8 | ||||||||||||||||||
| Balance, Beginning of year, as adjusted | 2927.7 | 492.8 | |||||||||||||||||
| Net income | 454.9 | 454.9 | |||||||||||||||||
| Changes in: | |||||||||||||||||||
| Other comprehensive income (loss) | -451.1 | ||||||||||||||||||
| Treasury shares purchased | -155.6 | -9.8 | -12.1 | ||||||||||||||||
| Restricted stock issued, net of forfeitures | 2.7 | -2.7 | |||||||||||||||||
| Amortization of stock-based compensation | 15.7 | ||||||||||||||||||
| Other | -2.2 | [1] | 3.4 | [1] | |||||||||||||||
| Balance, End of period at Jun. 30, 2008 | 3224.8 | 41.7 | 675.4 | 863.6 | 4805.5 | ||||||||||||||
| Changes in: | |||||||||||||||||||
| Balance, Beginning of year at Dec. 31, 2008 | 2697.8 | -51.9 | 676.5 | 892.9 | 4215.3 | ||||||||||||||
| Stock options exercised | 1.2 | 6.2 | |||||||||||||||||
| Cumulative effect of change in accounting principle | 189.6 | [2] | -189.6 | [2] | |||||||||||||||
| Tax benefits from exercise/vesting of stock-based compensation | 0.2 | ||||||||||||||||||
| Balance, Beginning of year, as adjusted | 2887.4 | -241.5 | |||||||||||||||||
| Net income | 482.6 | 482.6 | |||||||||||||||||
| Changes in: | |||||||||||||||||||
| Other comprehensive income (loss) | 219 | ||||||||||||||||||
| Treasury shares purchased | -16.9 | -1.3 | -1.8 | ||||||||||||||||
| Restricted stock issued, net of forfeitures | 3.6 | -3.6 | |||||||||||||||||
| Amortization of stock-based compensation | 19 | ||||||||||||||||||
| Other | 0.2 | [1] | 1.3 | [1] | |||||||||||||||
| Balance, End of period at Jun. 30, 2009 | 3353.3 | -22.5 | $680 | 914.2 | $4,925 | ||||||||||||||
| [1]Primarily reflects activity associated with our deferred compensation and incentive plans. | |||||||||||||||||||
| [2]Pursuant to FASB Staff Position (FSP) FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments. See Note 11 - New Accounting Standards for further discussion. | |||||||||||||||||||
| Statement Of Cash Flows Indirect Insurance Based Operations (USD $) | |||||||||||||||||||
| In Millions | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 | |||||||||||||||||
| Cash Flows From Operating Activities | |||||||||||||||||||
| Net income | 482.6 | 454.9 | |||||||||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||||||
| Depreciation | 43.2 | 48 | |||||||||||||||||
| Amortization of fixed-income securities | 118.3 | 126.2 | |||||||||||||||||
| Amortization of stock-based compensation | 19.3 | 16 | |||||||||||||||||
| Net realized (gains) losses on securities | 57.5 | 12.4 | |||||||||||||||||
| Net loss on disposition of property and equipment | 1.5 | 1 | |||||||||||||||||
| Changes in: | |||||||||||||||||||
| Premiums receivable | -136.4 | -120.4 | |||||||||||||||||
| Reinsurance recoverables | -0.2 | 26.5 | |||||||||||||||||
| Prepaid reinsurance premiums | -0.2 | 6.7 | |||||||||||||||||
| Deferred acquisition costs | -22.3 | -19.9 | |||||||||||||||||
| Income taxes | -24.6 | 56.9 | |||||||||||||||||
| Unearned premiums | 203.7 | 193.2 | |||||||||||||||||
| Loss and loss adjustment expense reserves | 21.5 | 57.9 | |||||||||||||||||
| Accounts payable, accrued expenses, and other liabilities | 146.4 | 41.7 | |||||||||||||||||
| Other, net | 17.8 | 38.6 | |||||||||||||||||
| Net cash provided by operating activities | 928.1 | 939.7 | |||||||||||||||||
| Purchases: | |||||||||||||||||||
| Fixed maturities | -6119.8 | -2663.5 | |||||||||||||||||
| Equity securities | -25.8 | -546.6 | |||||||||||||||||
| Short-term investments - auction rate securities | 0 | -479.5 | |||||||||||||||||
| Sales: | |||||||||||||||||||
| Fixed maturities | 4850.5 | 2188.7 | |||||||||||||||||
| Equity securities | 456.3 | 278.6 | |||||||||||||||||
| Short-term investments - auction rate securities | 0 | 479.5 | |||||||||||||||||
| Maturities, paydowns, calls, and other: | |||||||||||||||||||
| Fixed maturities | 361.1 | 227.9 | |||||||||||||||||
| Equity securities | 0 | 34.9 | |||||||||||||||||
| Net sales (purchases) of short-term investments - other | 16.3 | -130.5 | |||||||||||||||||
| Net unsettled security transactions | (259) | -24.8 | |||||||||||||||||
| Purchases of property and equipment | -38.3 | -51.3 | |||||||||||||||||
| Sales of property and equipment | 0.8 | 0 | |||||||||||||||||
| Net cash used in investing activities | -757.9 | -686.6 | |||||||||||||||||
| Cash Flows From Financing Activities | |||||||||||||||||||
| Proceeds from exercise of stock options | 7.4 | 18.8 | |||||||||||||||||
| Tax benefit from exercise/vesting of stock-based compensation | 0.2 | 8 | |||||||||||||||||
| Dividends paid to shareholders | 0 | [1] | -98.3 | [1] | |||||||||||||||
| Acquisition of treasury shares | (20) | -177.5 | |||||||||||||||||
| Net cash used in financing activities | -12.4 | (249) | |||||||||||||||||
| Increase in cash | 157.8 | 4.1 | |||||||||||||||||
| Cash, January 1 | 2.9 | 5.8 | |||||||||||||||||
| Cash, June 30 | 160.7 | 9.9 | |||||||||||||||||
| [1]Progressive maintains an annual dividend program. See Note 9 - Dividends for further discussion. | |||||||||||||||||||
| Notes to Financial Statements | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Notes to Financial Statements [Abstract] | |
| Note 1 Basis of Presentation | Note 1 Basis of Presentation These financial statements and the notes thereto should be read in conjunction with Progressives audited financial statements and accompanying notes included in our Annual Report on Form 10-K for the year ended December31, 2008. The consolidated financial statements reflect all normal recurring adjustments which, in the opinion of management, were necessary for a fair statement of the results for the interim periods presented. The results of operations for the period ended June30, 2009, are not necessarily indicative of the results expected for the full year. Subsequent events have been evaluated through August10, 2009, the date the financial statements were issued via filing this Quarterly Report on Form 10-Q with the Securities and Exchange Commission. |
| Note 2 Investments | Note 2 Investments During the second quarter 2009, we adopted the new accounting guidance relating to the recognition and presentation of other-than-temporary impairments (see Note 11- New Accounting Standards for further information). The following table presents the composition of our investment portfolio by major security type consistent with our internal classification of how we manage, monitor, and measure the portfolio: ($ in millions) Cost Gross Unrealized Gains Gross Unrealized Losses Net Realized Gains (Losses)1 Fair Value % of Total Fair Value June30, 2009 Fixed maturities: U.S. government obligations $ 5,362.6 $ 9.3 $ (144.6 ) $ $ 5,227.3 38.4 % State and local government obligations 2,383.7 56.1 (36.8 ) 2,403.0 17.7 Corporate debt securities 803.4 19.1 (25.8 ) 796.7 5.8 Residential mortgage-backed securities 561.7 .7 (121.8 ) 440.6 3.2 Commercial mortgage-backed securities 1,491.7 5.9 (111.6 ) 1,386.0 10.2 Other asset-backed securities 200.5 3.3 (3.0 ) 200.8 1.5 Redeemable preferred stocks 648.2 9.0 (179.3 ) 477.9 3.5 Other debt obligations 2.1 .9 3.0 Total fixed maturities 11,453.9 104.3 (622.9 ) 10,935.3 80.3 Equity securities: Nonredeemable preferred stocks 810.4 334.2 (3.3 ) (11.2 ) 1,130.1 8.3 Common equities 292.4 123.7 (7.4 ) 408.7 3.0 Short-term investments: Other short-term investments 1,137.2 1,137.2 8.4 Total portfolio2,3 $ 13,693.9 $ 562.2 $ (633.6 ) $ (11.2 ) $ 13,611.3 100.0 % ($ in millions) Cost Gross Unrealized Gains Gross Unrealized Losses Net Realized Gains (Losses)1 Fair Value % of Total Fair Value June30, 2008 Fixed maturities: U.S. government obligations4 $ 1,636.9 $ 9.0 $ (5.6 ) $ $ 1,640.3 11.7 % State and local government obligations 3,178.4 23.3 (38.8 ) 3,162.9 22.7 Foreign government obligations 30.0 .4 30.4 .2 Corporate debt securities 969.0 2.2 (28.9 ) 942.3 6.7 Residential mortgage-backed securities 853.9 3.8 (34.9 ) 822.8 5.9 Commercial mortgage-backed securities 1,856.2 12.5 (42.1 ) 1,826.6 13.1 Other asset-backed securities 167.1 .8 (2.0 ) 165.9 1.2 Redeemable preferred stocks 712.6 1.8 (95.7 ) 618.7 4.4 Other debt obligations 2.1 .9 3.0 |
| Note 3 Fair Value | Note 3 Fair Value We have categorized our financial instruments, based on the degree of subjectivity inherent in the valuation technique, into a fair value hierarchy of three levels, as follows: Level 1: Inputs are unadjusted, quoted prices in active markets for identical instruments at the measurement date (e.g., U.S. government obligations and active exchange-traded equity 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 observable for the instruments, and (iv)inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3: Inputs that are unobservable. Unobservable inputs reflect the reporting entitys subjective evaluation about the assumptions market participants would use in pricing the financial instrument (e.g., certain structured securities and privately held investments). During the second quarter 2009, we adopted the new fair value guidance (see Note 11 - New Accounting Standards for further information) that requires us to evaluate whether a market is distressed or inactive in determining the fair value for our portfolio. Based on this new guidance, we added to our review certain additional market level inputs to evaluate whether sufficient activity, volume, and new issuances existed to create an active market. Based on this evaluation, we concluded that there was sufficient activity related to the sectors and securities for which we obtained valuations. The composition of the investment portfolio by major security type was: Fair Value Cost (millions) Level 1 Level 2 Level 3 Total June30, 2009 Fixed maturities: U.S. government obligations $ 5,227.3 $ $ $ 5,227.3 $ 5,362.6 State and local government obligations 2,403.0 2,403.0 2,383.7 Corporate and other debt securities 772.3 27.4 799.7 805.5 Asset-backed securities: Residential mortgage-backed 440.3 .3 440.6 561.7 Commercial mortgage-backed obligations 968.2 18.2 986.4 1,060.4 Commercial mortgage-backed obligations: interest only 394.8 4.8 399.6 431.3 Other asset-backed 181.0 19.8 200.8 200.5 Total asset-backed securities 1,984.3 43.1 2,027.4 2,253.9 Redeemable preferred stocks: Financials 15.2 188.7 203.9 277.2 Utilities 56.9 56.9 70.9 Industrials 168.1 49.0 217.1 300.1 Total redeemable preferred sto |
| Note 4 Debt | Note 4 Debt Debt consisted of: June30, 2009 June30, 2008 December31, 2008 Carrying Fair Carrying Fair Carrying Fair (millions) Value Value Value Value Value Value 6.375% Senior Notes due 2012 $ 349.0 $ 351.8 $ 348.7 $ 362.2 $ 348.9 $ 355.3 7% Notes due 2013 149.4 161.2 149.3 159.1 149.3 154.3 6 5/8% Senior Notes due 2029 294.7 279.3 294.5 293.6 294.6 272.0 6.25% Senior Notes due 2032 394.1 361.7 394.0 377.0 394.0 350.0 6.70% Fixed-to-Floating Rate Junior Subordinated Debentures due 2067 989.2 705.0 988.2 860.7 988.7 450.0 Total $ 2,176.4 $ 1,859.0 $ 2,174.7 $ 2,052.6 $ 2,175.5 $ 1,581.6 On December31, 2008, we entered into a 364-Day Secured Liquidity Credit Facility Agreement with National City Bank (NCB). Under this agreement, we may borrow up to $125 million, which may be increased to $150 million at our request but subject to NCBs discretion. In conjunction with this agreement, we deposited $125 million into an FDIC-insured deposit account at NCB in January 2009 to provide us with additional cash availability in the event of a disruption to our cash management operations. Our access to these funds is unrestricted. However, if we withdraw funds from this account for any reason other than in connection with such a disruption in our cash management operations, the availability of borrowings under the NCB credit facility will be reduced on a dollar-for-dollar basis until such time as we replenish the funds to the deposit account. The credit facility will expire on December31, 2009, unless earlier terminated according to its terms. We had no borrowings under this arrangement in 2008 or through the first six months of 2009. |
| Note 5 Income Taxes | Note 5 Income Taxes At June30, 2009, our current estimate of the valuation allowance on our deferred tax asset was $18.0 million, which reflects our potential inability to realize the full amount of the deferred tax asset related to our unrealized losses on securities that were either determined to be fundamentally impaired or that we may not hold until recovery. During the second quarter 2009, we reversed $17.0 million of the valuation allowance that was originally established in the first quarter 2009 ($8.0 million was previously reported as a component of net unrealized gains (losses) on securities and $9.0 million was included in our provision for income taxes), reflecting the improved market conditions during the period. At December31, 2008, management believed that it was more likely than not that the deferred tax asset would be realized and that we would be able to fully use the deductions that are ultimately recognized for tax purposes. We will continue to evaluate our deferred tax assets to determine if any changes to the valuation allowance are necessary. The effective tax rate for the six months ended June30, 2009 was 34%, compared with 29% for the same period last year, primarily reflecting the $18.0 million valuation allowance discussed above. There have been no material changes in our uncertain tax positions during the quarter ended June30, 2009. |
| Note 6 Supplemental Cash Flow Information | Note 6 Supplemental Cash Flow Information Cash includes only bank demand deposits, including $125 million on deposit with National City Bank (see Note 4 Debt for additional discussion). We paid income taxes of $271.0 million and $118.0 million during the six months ended June30, 2009 and 2008, respectively. Total interest paid was $72.3 million for both the six months ended June30, 2009 and 2008, respectively. Non-cash activity includes changes in net unrealized gains (losses) on investment securities. |
| Note 7 Segment Information | Note 7 Segment Information Our Personal Lines segment writes insurance for private passenger automobiles and recreational vehicles. Our Commercial Auto segment writes primary liability and physical damage insurance for automobiles and trucks owned by small businesses in the specialty truck and business auto markets. Our other indemnity businesses primarily include writing professional liability insurance for community banks and managing a small amount of run-off business. Our service businesses include providing insurance-related services, primarily policy issuance and claims adjusting services, for Commercial Auto Insurance Procedures/Plans (CAIP), which are state-supervised plans serving the involuntary market. All revenues are generated from external customers. Following are the operating results for the respective periods: Three Months Ended June30, Six Months Ended June30, 2009 2008 2009 2008 Pretax Pretax Pretax Pretax Profit Profit Profit Profit (millions) Revenues (Loss) Revenues (Loss) Revenues (Loss) Revenues (Loss) Personal Lines Agency $ 1,826.5 $ 127.0 $ 1,848.0 $ 93.5 $ 3,643.8 $ 309.8 $ 3,694.0 $ 208.0 Direct 1,205.6 86.0 1,113.1 92.0 2,376.7 184.7 2,207.1 133.9 Total Personal Lines1 3,032.1 213.0 2,961.1 185.5 6,020.5 494.5 5,901.1 341.9 Commercial Auto 403.3 38.7 445.3 33.9 815.6 112.5 890.0 59.8 Other indemnity 6.0 2.1 4.8 .3 11.9 2.8 10.1 .2 Total underwriting operations 3,441.4 253.8 3,411.2 219.7 6,848.0 609.8 6,801.2 401.9 Service businesses 4.1 (.6 ) 4.2 (1.2 ) 7.6 (1.7 ) 8.6 (1.9 ) Investments2 138.0 135.4 121.2 118.3 196.1 190.9 312.7 308.3 Interest expense (34.7 ) (34.3 ) (68.4 ) (68.6 ) Consolidated total $ 3,583.5 $ 353.9 $ 3,536.6 $ 302.5 $ 7,051.7 $ 730.6 $ 7,122.5 $ 639.7 1 Private passenger automobile insurance accounted for 90% of the total Personal Lines segment net premiums earned in all periods; insurance for recreational vehicles (special lines products) accounted for the balance of the Personal Lines net premiums earned. 2 Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expenses. Progressives management uses underwriting margin and combined ratio as primary measures of underwriting profitability. The underwriting margin is the pretax underwriting profit (loss) expressed as a percentage of net premi |
| Note 8 Comprehensive Income | Note 8 Comprehensive Income Total comprehensive income was: ThreeMonthsEnded Six Months Ended June 30, June 30, (millions) 2009 2008 2009 2008 Net income $ 250.1 $ 215.5 $ 482.6 $ 454.9 After-tax changes in (excluding cumulative effect adjustment): Net unrealized gains (losses) on securities 386.5 120.3 235.5 (449.6 ) Portion of OTI losses recognized in other comprehensive income (15.5 ) (15.5 ) Total net unrealized gains (losses) on securities 371.0 (120.3 ) 220.0 (449.6 ) Net unrealized gains on forecasted transactions (.2 ) (.8 ) (1.0 ) (1.5 ) Comprehensive income $ 620.9 $ 94.4 $ 701.6 $ 3.8 |
| Note 9 Dividends | Note 9 Dividends Progressive maintains a policy of paying an annual variable dividend that, if declared, would be payable shortly after the close of each year. This annual variable dividend is based on a target percentage of after-tax underwriting income multiplied by a companywide performance factor (Gainshare factor), subject to the limitations discussed below. The target percentage is determined by our Board of Directors on an annual basis and announced to shareholders and the public. For 2009, the Board determined the target percentage to be 20% of annual after-tax underwriting income. The Gainshare factor can range from zero to two and is determined by comparing our operating performance for the year to certain predetermined profitability and growth objectives approved by the Board. This dividend program is consistent with the variable cash incentive program currently in place for our employees (referred to as our Gainsharing program). Although recalibrated every year, the structure of the Gainsharing program generally remains the same. Through the second quarter 2009, the Gainshare factor was .71. Since the final factor will be determined based on our results for the full year, the final factor may vary significantly from the factor of any interim period. Our annual variable dividend program is subject to certain limitations. If the Gainshare factor is zero or our after-tax comprehensive income (see Note 8 - Comprehensive Income above) is less than after-tax underwriting income, no dividend will be paid. While the declaration of the dividend remains within the Boards discretion and subject to the above limitations, the Board is expected to declare the 2009 annual dividend in December 2009 with a record date in January 2010 and payment shortly thereafter. In January 2008, Progressive paid $98.3 million, or $.145 per common share, pursuant to a December 2007 declaration by the Board of Directors under our annual variable dividend policy. However, no dividend was declared for 2008, since we generated a comprehensive loss for the year. For the six months ended June30, 2009, our after-tax comprehensive income was $701.6 million, which is higher than the $396.4 million of after-tax underwriting income for the same period. |
| Note 10 Litigation | Note 10 Litigation The Progressive Corporation and/or its insurance subsidiaries are named as defendants in various lawsuits arising out of claims made under insurance policies issued by our subsidiaries in the ordinary course of their businesses. All legal actions relating to such insurance claims are considered by us in establishing our loss and loss adjustment expense reserves. In addition, various Progressive entities are named as defendants in various class action or individual lawsuits arising out of the operations of our insurance subsidiaries. These cases include those alleging damages as a result of our use of consumer reports (such as credit reports) in underwriting and related notice requirements under the federal Fair Credit Reporting Act; practices in evaluating or paying medical or injury claims or benefits, including, but not limited to, personal injury protection, medical payments, uninsured motorist/underinsured motorist (UM/UIM) coverage, and bodily injury benefits; rating practices at policy renewal; the utilization, content, or appearance of UM/UIM rejection forms; the practice of taking betterment on boat repairs; labor rates paid to auto body repair shops; and cases challenging other aspects of our claims or marketing practices or other business operations. Other insurance companies face many of these same issues. We plan to contest the outstanding suits vigorously, but may pursue settlement negotiations in some cases, if appropriate. In accordance with accounting principles generally accepted in the United States of America (GAAP), we establish loss reserves for a lawsuit when it is probable that a loss has been incurred and we can reasonably estimate its potential exposure. Pursuant to GAAP, we have not established reserves for those lawsuits where the loss is not probable and/or we are currently unable to estimate our potential exposure. If any one or more of these lawsuits results in a judgment against, or settlement by, our insurance subsidiaries for an amount that is significantly greater than the amount, if any, so reserved, the resulting liability could have a material effect on our financial condition, cash flows, and results of operations. For a further discussion on our pending litigation, see Item 3-Legal Proceedings in our Annual Report on Form 10-K for the year ended December31, 2008. |
| Note 11 New Accounting Standards | Note 11 New Accounting Standards For the second quarter 2009, we adopted the three FASB Staff Positions (FSPs) finalized in April 2009. FSP FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions that Are Not Orderly, provides additional guidance on estimating fair value when the volume and level of activity for an asset or liability have significantly decreased in relation to normal market activity for the asset or liability and clarifies that the use of multiple valuation techniques may be appropriate. In addition, the FSP re-emphasized that fair value continues to be the exit price in an orderly market. The adoption of this FSP did not have an impact on our financial condition or results of operations, but will increase our quarterly and annual disclosures. FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments, requires companies to disclose the fair value of its financial instruments in its interim reports. Since we have always disclosed the fair value of financial instruments in our quarterly reports, the adoption of this FSP had no impact on us. FSP FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments, provides guidance in determining whether impairments in debt securities are other-than-temporary and requires additional disclosures relating to other-than-temporary impairments (OTI) and unrealized losses on investments in both quarterly and annual reports. Upon adoption of this FSP, we recorded a cumulative effect of change in accounting principle that resulted in a reclassification from retained earnings to accumulated other comprehensive income (loss) of $189.6 million (or $291.8 million on a pretax basis) for the non-credit portion of the OTI losses previously recognized in retained earnings, as of April1, 2009. This reclassification had no effect on total shareholders equity. |
| Document Information | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Document Information [Text Block] | |
| Document Type | 10-Q |
| Amendment Flag | false |
| Amendment Description | N.A. |
| Document Period End Date | 2009-06-30 |
| Entity Information (USD $) | |||
| 6 Months Ended
Jun. 30, 2009 | Jul. 31, 2009
| Jun. 30, 2008
| |
| Entity [Text Block] | |||
| Trading Symbol | PGR | ||
| Entity Registrant Name | PROGRESSIVE CORP/OH/ | ||
| Entity Central Index Key | 0000080661 | ||
| Current Fiscal Year End Date | --12-31 | ||
| Entity Well-known Seasoned Issuer | Yes | ||
| Entity Current Reporting Status | Yes | ||
| Entity Voluntary Filers | No | ||
| Entity Filer Category | Large Accelerated Filer | ||
| Entity Common Stock, Shares Outstanding | 678,600,888 | ||
| Entity Public Float | $11,621,202,821 |
