PGR - Earnings call transcript Q3 2024 | The Progressive Corporation

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Douglas Constantine

Good morning, and thank you for joining us today for Progressive's first quarter investor event. I am Dough Constantine, Director of Investor Relations, and I will be a moderator for today's event.

The company will not make detailed comments related to its results in addition to those provided in its annual report on Form 10-K, quarterly reports on Form 10-Q and the letter to shareholders, which have been posted to the company's website.

Although our quarterly Investor Relations events often include a presentation on a specific portion of our business, we will instead use the 60 minutes scheduled for today's event for introductory comments by our CEO and a question-and-answer session with members of our leadership team. The introductory comments by our CEO were previously recorded. members previously XX we event minutes questions answers the balance use for of team. and the leadership of scheduled with completion recorded will remarks, the live Upon our of for this

As during always, include These many and are to statements events risks expectations materially event today's and on those current could subject differ forward-looking and cause management's actual statements. based are in discussions this event. may to discussed uncertainties from that results

statements at available discussions is December uncertainties Investor to I'm begin our and supplemented affecting risks the some quarters those be concerning where safe of will for we the ended documents us off information on website of report year related the by pleased for you factors introductory XX-K found introduce who face. our CEO, via third with find comments. harbor XX, in our investors.progressive.com. To statements business, and Form Tricia? second XX-Q of other Tricia These Additional Griffith, can annual our will today, as and discussions first, kick XXXX, risk our to of section the Form forward-looking Relations XXXX, the challenges

Susan Griffith

devastating. us Good and the Helene human today those morning, affected destruction truly heart-wrenching thank and of were was today. you by Milton. my toll sympathies I'd joining these and like begin Hurricane extending to for by to The storms scenes of

I'm heartened need. their by of efforts know greatest continue, standing in to claims the As customers is Progressive's our cleanup to that excellent assist staff time

with one shine you. most, the stories customers and brightest. share we heard This to need In countless our fact, I've of about us like versions is the when I'm

I Tampa Marie I'm is with he loss of day. X adjuster, and just assessing cancer. I prompt, the meet pleasure it tell enough and to would while compassion my fought with one for Anne do about. it's for our in claims Ray. you Beach and what lovely say months happy every was back Helene. property. our horrible came He to you Hurricane Timothy. is is cannot Myers my my Fort to encounter the that that every to damages RV heart positive me the he my with of professional you of We I've by is these sitting bedside about That's amaze fiancé from been name showed circumstances. in the home. Ray. a to this be like Timothy's one's things person My this say Ray perfect was To meet last remission. bottom under for about He lost all is a colleagues, day. Thank my I gentlemen. all of and each you kind, to

Turning towards results.

in sales, in our of quarter force, expect customers third strongest a experience during the ever in was challenge, our us. have the the quality policies X.X The added million of our added Across to nearly our the we've brings this a million, quarter. history. businesses, in X.X year policies added total This we one almost most staffing, teams truly providing of maximize this while to met The our increases us requires and servicing feat. growth magnitude growth remarkable claims the year and enabling

Throughout across products strong third channels. Personal very both the we Lines quarter, our for demand experienced

agency all where wasn't cylinders was record channels into a in potential experiencing applications. levels few QX. firing the of evidenced immediately business results to is weeks last The as year, non-rate our While earlier growth spend in direct in of channel the channel's growth new application clear The quarter new release and increase machine of our on actions realized the with the both fully quarter. result growth in media stronger responded channel's almost by new second the growth third

To date, number we history, of media in XXXX, Personal prospects of higher spent than any on direct holder. capitalized In channel ambient any result QX QX than was very our quarter more and previous the we in Auto remains in surpassing XXXX, history. have level that. on quarter the high, shopping a our The in record

Additionally, are strong, well suggesting conversion competition. priced the that compared is we to

record Though share position the our sales profit our especially impressive are to margins. even of when from believe December volume, ourselves you growth fourth prospects than continue that can November historically we more marketplace. fair more quarter, and the lower in we capture The consider is to

in is Our year-to-date of reflected Hurricane years combined strong. shaping Milton best XXXX our the through to ratio QX are numbers, history. of one non-pandemic up in was still Though not cost QX our the very be

is testament at over a still. in profits the pace segmentation our standing with made we've we're investment the not to years. record And Growing

Our our states which in represent available Auto newest product to continues model, that further segmentation premium. X/X add is in products of our written Personal net about

same the the in of pressures Personal Auto loss impacted And was rising XXXX, took increases we response Commercial the recall rate by You'll double-digit and Lines. in market that inflationary to in cost, XXXX. as XXXX many

we third our Commercial ratio LAE of In for our quarter and reported Lines. straight QX loss XXXX, in quarter-over-quarter improvement

as market lines in in results our XXXX market our policies has line difficult more months. a since the XX the Growth the solid process is from took rate been slower targets. truck softness business Our in, in part in the are majority earning we in that other non-trucking offset which in has commercial of growth

for however, competitors the positioned in optimistic we are our well in catch up we're As that future. more growth rate,

quarter points the of points of development third XX.X% from half despite property storms after in The first the and Hurricane the Helene. were XX by incurred XX favorable year excellent a losses at on results combined ratio of almost

underscores hurricanes our need week business. X to only apart, a striking adjust property Florida our risk However,

to a QX here X% efforts weather-related to be PIF in Our consider of the states. less of growth are volatile weather compared what states volatile evident we decrease XX% in with

we are progress. making effort, Risk long but adjustment been will and year's be has a

underwriting targets, to make of continue As segments their to is headway always, our have profitability property our we in our appetite. in segmentation model and to with improved our all goal meet business and product adjustments our X.X reporting

today, look I I opportunity. see when results across huge amount Ultimately, of a our

comes we While we the that The the headed react actions be know or what XXXX. are take a whatever to good believe our what and for position we we position will we what in flexible way. today firmly can't in year, and holds what are that next to to a future into I bring, good achieve position believe exactly us I are market

already fourth strong a quarter undoubtedly I'm While a there great looking will XXXX. will be forward what and be anticipate challenges, I to

your Thank you again, questions. and I will take now

Douglas Constantine

of event. We have to live will take members recorded questions. We portion This management team of now now answer our first previously today's concludes question. the Instructions] available [Operator our

Operator

Josh of first Bank comes Shanker Our with from question the of America. line

Joshua Shanker

premium this considering are commensurate about count is as a good about price the revenue But we that because think for to near-term there very, a bodes who growing policy asked growth? Progressive cuts the -- or policy Or with number? price, We did future. idea improvements is at the Progressive's are some not would in margins, as if of fast cut combined that can, if come count a think very $X.XX it better number? ratio Progressive I

Susan Griffith

fast talk at growth look a can. Josh, We about we when good as both question. we as it's

because on average as preferred growth, our last we can always Some our talk growth PIF growth. of about And our ebb are in several seen internal our rates based and measures, the years. you've unit trends is success flow

is our So that preferred method.

rate. Obviously, trend. stable if to And retention we helpful have is a we stay very ahead want of that we know

increased want we possible get obviously, we our to So new want as as in apps then the many spend. those. to keep media door But our -- through

And so a it's I everything. balance think of

they $X.XX. growth, as make want can service grow we always stay premium, to unit as we of So that least your long And trend question? as want our we customers deserve. Does we fast answer the and in that as to can ahead way at

Joshua Shanker

margin the -- Are yes.

I So future? cuts view in be near-term so are margins today they has should considering that -- the that more price tasty a guess Progressive the

Susan Griffith

price will trend Well, you the know what carefully. we cuts, watch

some about said we cuts, that up X in states like of states So -- there's had we went the it. but Q, did price we also

in current -- to propel we So to use the we to want I past want that what growth. is the have, use I've talked we about think in margins really --

to we're really bit small will we rates back will But But and well as that to we media towards of our products continued channels to apple rates see ahead to grow. to sort growth. We a want march using the to stay increase positioned just it where of have the organic to stable. believe So well. states continue and have we be spend have and that that to those where bite continue we little go

Operator

Morgan Stanley. with of next comes from line question the Bob Huang Our

Jian Huang

Maybe that, more environment just perspective. a follow-up the on on but competitive

the then little pricing view a the be? your but come bit, should we we ad Like were competition in or forward, think will ad think about of your the effectiveness as if curious intensified and side spend feel the you XXXX we spending but effective going ad will the As do incremental in ad your and expect about in spend, on down advantages spending maybe pricing how pricing, like and competitiveness this?

Susan Griffith

we'll side. want did, our get the a And customers. that and -- as Yes. as favorable I look is to cost to to see acquisition sure this mean We per street, little have I convert their not make if get and media competitors on bit, rates we still time to spend back cost, an at people efficiency think from continue taken we'll more our always customers perspective. sale more on coming the we media quickly targeted we obviously,

little continue we're we're in on feel the in we're some I we've feel margins those hard really consumers and spending, bit And we stable rates. door, push been well spending have current we're but to media where on positioned really if our in just with delayed people, because -- a going we've on now addition, a going and afield, getting to we like to And at, just market, and push money believe still we're think business been it's but to continue we right how growth. ads. not further response and shop,

Anthem we communities that if sure a lot exist recently my So fully. progress. and about either know call culture know talk put our our who purpose enough ads we And overnight. forward my or and letters, and people customers my And some I to we of our know about consumers out I I'm purpose don't you isn't don't move I sort notice comments you in people, help people -- and and are. our talk do, live progress to We've that

a we're see all of purpose kind and on You things of should look page the you and Google, up Progressive doing.

more bit be but And so going will with. a seeing some we you're be delayed balanced are want as response, to of with little response, that, -- nicely that involved believe, you a we that be with a of adds to sort we're who are company a

love So about Yes, we're we're think our have continue prepared. We and media, excited rates to competition. in competition show up growth. right the but I will

Unknown Executive

competitive should by where what price. be the to both we our questions. assessing They those the our [indiscernible] calls product The And we and is And just the there segment. they're locale. to are by and of elasticity response are they way channel through at understand the with that objectives managing in sit level, by we marketplace, level making doing and they in operationalize state product landscape managers. decide

manage beneath going can Obviously, to we lot the are is a those managers extent grow calls. make objective. the $X.XX and the that, to But product the

you So aggregate time, of level. over I look the local the at our at you all see when performance decisions those think

operationalize is I but that the that So questions, understand how -- to in marketplace our really understand we think model. I the I think important understanding

Jian Huang

retention. much appreciate Okay. Very on is second question that. My

relatively So commentaries, been cycle your for expectancy life a that's year stabilizing. expected the now, than right? if over pricing the -- policy. Auto is we If a relative business, life probably your Personal to elongated been your then more policy business, at I remember And look of XX-Q auto has correctly,

life favorable that other life words, that going right stabilize continue of to forward? you'll expect In stabilize need to should if rather kind is than pricing marginal were ratio So improve? that to some probably going forward, be combined contribution it less assume pronounced that as to to cycle cycle we

Operator

we remain again, holding Once reconnect Difficulty] [Technical speakers. please as everyone,

Susan Griffith

your I on Victoria. that. was thought end, our apologize Thanks, Okay. it on was but for end. that I

hour, at we we'll the And so if questions the have of time. elongate end the certainly

and you're Bob, I So question, retention. second asking think was it your about

is quarters I in course, one I And going this jinxed think Progressive. to because best then, was have like, I weekend computer the must preparing, of us, be when This of the history this of I'm our crash. is great.

again. apologies So

Jian Huang

it's road. of was you're sure Yes, growing or life expect think better given that's your life quarters is even ratio last combined Would essentially kind and now trying over the don't few expectancy you that down expectancy -- question the an Yes, to policy headwind a you as quarters, normalizing. have your for I'm -- and policy every have that towards issue?

Susan Griffith

I mean holy grail. of our think is yes, kind Well, I retention

So grow units. our it's always an to issue

to to year comparison But XX%. last have a has pretty the don't when it and to that the come really and of was We that been up flat, So all media yes, customers the in of watch leave. closely. then money that's want on lot was we with just spend of we've board. lot down. a taken actions some the TXX the And that's across do TX

and So add or our anything, retention. you want to continue service improve those great rates John? focus Pat to stable to really Do is

Patrick Callahan

No, I think good. that's

Susan Griffith

Thanks, Bob.

Sorry again. about that

Operator

of Wells comes question Greenspan from next Our the Elyse line with Fargo.

Elyse Greenspan

sometimes to this the Tricia, you your quarter slower as little question, hit vacation. think to the how right? about playing how just in on the gains understand could the of first just I a typically, spend because think well out last I growth there's QX, bit of marketing we want I'm you PIF think did the and just shopping just elevated your and holidays about it remarks, continued -- given trying about My year? but was dynamic prepared in think as year,

Susan Griffith

you less back be prepared going to based push throughout on on you quarter. really a And don't get our to more that to we it's expenses than say, end for have media. we're of if well, continue that little want media share and shoppers are the our and the response typically Yes. have bit for bit want just and shopping Yes, And could fair holidays. really, in spend in you XXXX. want and first even to Thanks, of happens pull consistent easily Elyse. shoppers, that believe -- we November-December -- really, the wouldn't that a little But -- normally that we

peers, position, we in really better to good it's about we are relative believe So we our are. a and position, that a

Elyse Greenspan

my second then growth Progressive question, year obviously, And right, record for this year.

guys. next lot rate industry, you perhaps of behind but about today, about guys are how know taking obviously a As How think the could do I a you right, out? play different think bit environment, 'XX? right, a less just variables, you you growth do you year here think there's from perspective, sitting

Susan Griffith

We feel good about bullish really and XXXX.

better literally -- so on in the much auto You're our about that be to side. agency Q, that we XX% private doesn't feel we talked grow, app the But basis XXX% a obviously, going our fast about especially we're passenger will new on mean the just Those side, comps look part. at direct a as And some in can. amounts. on not growth mean, relative going we And we to are basis, more as the stats difficult. on unit rates, massive I

as bullish our Commercial earning having and our side. still on in product, that we're feel well rate the about we property derisking positioning

So we at growth look our feel we from strategic like our pillars.

we've culture So people. and great got great a

customers. our and adequately organization We claims especially call are to take service, care center staffed, in organizations sales for and of our very our

care non-acquisition deeply We our reduced because -- we about expenses rates. ratio, compare expense on the competitive we those

you've our continue so people We culture. and segmentation, got

You've got competitive rates.

a perspective, which XXXX. where customers huge to a those in margin With perspective from we're We're evolve pricing you've our we X think to at going want strategic to pillars coverage, be aware got have brand, our I a and opportunity and and got You've in and how broad continues right? shop.

Operator

Our question Michael from comes Oppenheimer. of the next line with Phillips

Michael Phillips

put drill I the wanted frequency you to in to -- severity down the on I wanted trends Q. that

kind bit as liability. -- And Specifically, severity improve as looks of looks anything XQ? up to of of BI make didn't to anything make and the the a -- It frequency like that? it moved like kind much of

Susan Griffith

in BI losses line repped. large higher injuries more the that are little a coverage, where there higher soft is From and other some perspective, mostly Yes. it's attorney bit a of tissue

being So we verdicts I'm elevated and egregious. you're are believe pretty up social reading we ends industry jury expensive. on usually have some more And inflation sure seen across that lot pretty that the a

trend, our in So And car prices sort of eye there BI that. of continues confluence than of up keeping representation chips with et the on based were events was the look we're of on of history medical always attorney into to sort just are bills, you and cetera. injury at bodily of a risen. based what less things When play shortage step all on where function happened terms used prices trends of it car came when that the a move like were

quarter, we So trends. around too arms and we're concerned not we like about feel one have our the BI

Michael Phillips

second remind in And then homeowners. Can Good. I reductions cat-exposed Okay. PIF us are you states? the just with, guess, where question you on

Susan Griffith

Yes.

about our we PIF So little a bit growth. talked

So states down X% we're in volatile states. in XX% up our and growth our

to continue derisking a have program. really We robust

other We the to So on XX elevating. then -- XX; seen points rates rate trailing you've have earn this had X in. and we points year-to-date, more that year, come in are the XX

be about about in the work what the leaders industry it property street. We we that. last exiting been be we need and So insureds, DPX exiting of will in product. about thing in continue the to to talked talked in approvals We but believe lot Florida And can our we've right exit line be we've X.X -- you in and to you're the rates states. That's and that's there to prior many on auto, after able one, states first a segmentation. that about are time of and do communicate though segmentation. to working XXX,XXX obviously many are year. we with we our approval course, have XX DOIs, least some commercial in at for sure in, and auto we're more we as working is there homes the moratoriums on -- That have Segmentation we by time takes get we that And have states off been coverage.

be really, don't homeowners it's to cost program. maintenance want We then about And sharing. a

just hail then which a progressive have owner-occupied conversations on agents we and sheet. and the system. high-quality our business, are business deductibles coming wind bundled mandatory and on lastly, with is usually preferred and So homes through those putting high-quality balance And the

plan. So multitiered what we've a good it's this at. elevates a it while been take about where feel apart, But has I got be a a We huge hurricanes, while plan -- We would what and we're while. for future. clearly, having the X knew very week than really would less a ago, signaled in but our

Operator

comes Our the next Peters. of from question Gregory line

Charles Peters

to your spend business program you comes how trying rewarding can snapshot I compensation your new in agents the as agent they're if just it reward business leverage changed a underwrite minute and know you've profitable you're how mentioned you've business. helping -- you and Maybe a to give door?

Susan Griffith

Yes. our I'll But are have give and more It's I than that evolving constantly we let agents, Pat specialized. preferred color bundling. will. more agents we're

in Asians. We our have plant

more business to want on but on agents but color high Pat, quality and some have typically we do on more We that? agents have for make been give also any evolve the that sure reward compensation those books, Sam's we you to mom put that pops, our constantly that maybe business.

Patrick Callahan

Sure.

We are commission we the in actions, how is respond And compensation different over result our And or products and without see have for have business matrices understanding we of behaviors to understanding the business what full understanding allocating can time, to agents the well place structure in framework suite higher-quality property business. those either to reward the access designed of greater with targets to volume agencies. agents, and those their national so property how our their for those an products. that aligned works are, what and Progressive better

agency they property mentioned our with on pivot to combination more in agents high-quality know to volume us. guidelines we and write have quality and to there as business. underwriting a profitable plan. that underwriting national mind, a side will invest we cancel Now with Tricia compensation X They agencies of what fit And turn measure Agents that are amount their to very in in with property think understand channel clear, we're things, And can the tactics have how to business through rates. producing how retain ensure by produce benefit that mutually of certain they their to within offering, have be around, we ultimately, with the the and business transparent bundling we those appointment start us. we

Charles Peters

sense. Makes

your end force For X.X did million year. than about said response question, letter, staffed. have you In policies my in follow-up fully how remarks, questions you talked of some of in you in Tricia, at to you last your more nearly the prepared the you're

the it things your in you're Maybe you're from you sense such a that's or of policy and And seems helping much technology environment, the force. keeping staffed maybe can you information maybe never of and in is artificial with growth many -- intelligence peers get in deploying employment. us how you of we fully macro one full a full tremendous how segue, with give growth in a

be on would great. that So any commentary

Susan Griffith

It's a Yes. really great question.

we after recall had when we've wage in sort difficulty I what the hiring the with doing, time of the -- had So that pandemic. retaining can only started we and been right wars

a well We've done of things. of couple So we've after need. advance that, in hired

takes So call when our claims being it a out the field, center licensed a sales in or fully about you think fully some rep trained rep time. in

most. early feet to own our employees with appraisers pays us itself were catastrophes, of closures handling us able storm's we on calls, is high-quality that customers the And more independent in at deploy your blush, people have what people contacts sort we so to for the and because street handling early we your claims. which need -- it's that's while in And a our expensive help X,XXX between venture first and maybe getting think fact, our

that. So really about feel good we

perspective, and easier more two, technology prices to a From become keep can actually and take are complex easier handle the of One, always efficient. calls more do talking system efficiency have about we claims, humans calls. how we we the out competitive. But

language you our So We've can -- you have, for require can become we that in over a long calls. been decade, it, were centers We've those chatbot human models. getting a our didn't chat large time found on overall, And working call what ChatGPT, more It that AI, had a call for of -- efficient. intervention. calls. really a we repetitive because we took out about XX% to

side, automation On lot a estimates. of the claims we have our with

We individuals make have right to to always we it. the Besides parts use efficient, that net we that. highly we we sure part continue to have are do pay to the of to human we that technology-driven. and be pictures And amount have complex tagged that to But and most millions trained of of be and intervention being course, we our for we very want learn in want do we innovative make want make millions able the sure of that sure to and business.

a So that's our we that. at AI we a which in time when the our that's some lot part But about quarters deep like have dive feel talk we something later efficiency, do and we in of that growth. a overall one key we use key of to is can maybe

Operator

Jimmy of line with the JPMorgan. from comes question Bhullar next Our

Jamminder Bhullar

of questions growth shifting answered. to have like competitors as -- my it But focus their seems many are of just recovered. your their were Most margins

what over in slow down is of wondering you're more behavior becomes few on it on as and that quarters marketing just just the terms market should next So competitive? competitor the And assume reasonable pricing? your seeing to growth spending

Susan Griffith

Yes.

before, like got to certainly with needed. would competitors be We plan -- We game. quickly. be ahead paid did we that, I and has frustrating had knew because to raise We would we that significantly out saw of would it think off. our our said I And we what to trend. grow a position is what say I in that so allow that us rates was to keep the up

and -- quarterly much We if competition. our are seeing the with margins still better results, are see you

seen would I will of And We've spend our start sure, to so imagine media. on growth. to some that competitors, continue more for they

really You competition having same time. and at we for is strategic those what, firing us, it about, all is I know good, -- said, like the

So I predict will what growth can't our be.

that work we on. obviously, models, have internally We

wrap I really feel And position believe and to in into XXXX very we're I that move to will up great a gain confident we XXXX. traction. continue

given course, happen with that weather all last the the over we've unknowns what seen Of years. several could and

Patrick Callahan

only thing is. would add that The Yes. I

Jamminder Bhullar

then more... And spending

Susan Griffith

add think, a I on Hold Jimmy, color some Pat that second, for to wanted you. on on for

Patrick Callahan

The only thing I matter. would add is that segmentation

spending isn't customer desire. folks more the the lifetime It's the outcome and media smartly necessarily of to drive So understanding that and going to the value it customers. spending we use reach those

spending creating are who and world where space. like places. to acquire, on about scale spending media product given It's we efficiently right have that more understand segmentation overall. And to the we're the to in we So place, in more we given just based not analytics segmentation in us our the in we have think, segmentation it's the and able spend enables

synthetic on segmentation think do think Additionally, ours have. you see product rates that creating we to adverse than through that trend think, adjust time when over I for trend, selection do the And differently to different their risk what matching we does potentially over requires our time. side, more we inflate we have them rate precisely competitors than to

at and And our we extremely game, our good we managed this economics, that confident efficient we'll in point, we as But pretty are time. we're look closely we this mentioned, Tricia So monitor our and they adjust and it at spend. play as point. over needed

Jamminder Bhullar

there's it rates rep as seeing a in and of talk attorney And Commercial about you what it stuff? auto you're long-term to in relates been trends litigation, talk personal in Line. seems lot about like, terms Can obviously, just of

Susan Griffith

Yes. Attorney years. over Again, risen have rep option the the rates not they've risen.

You up. just know, insurance have advertising perspective. just to Medical trends, from continued as you by medical can that probably go from tell

for priced -- So it continued been trend We that. has upward. it's to

in have up, some I with of ends troublesome to industry And are some verdicts that. social because the egregious it always said, pay for consumers like inflation, the

And many and so and by they of needs right sure in It's front what for the it's communicate to their out contacts quickly we there thing and get claim always possible. them the can us Or customers we're do around. many, a to longer-term well as years, try we want the them and have claim, about that for we done that to get to know really make arms when respect making our that trust that sure as doing that with way. our resolution along is

So we years since should just that IR there years in been -- and them and get want we've they to we'll what ago, be and response, the years make say ago, us we're I trust sure fair. we our immediate customers, rolled of front that's out know doing to

Operator

of with Our line next Motemaden the David Evercore. question comes from

David Motemaden

had impacts at Helene September? the shopping impact question any shopping or PIF the if retention Carolinas Hurricane -- causing a had of on and a that Milton auto in And end Milton on or of gains I is if auto I'm on storm? the the just wondering given growth. And just PIF Hurricane notable Florida disruption

Susan Griffith

replace, Obviously, growth necessarily. Progressive. they that there PIF some they'll Yes. when say come wouldn't be that loss I wouldn't with hope that total vehicles will anything from we be

to I on inventory inventory care could of in There's consumers. be move street were see that And something storm, those. But be think believe, able could a don't with they were claims would enough new that of although for the a issues. issues big, the needle President headwind customers. on they seeing we inventory ago, the be if asked our for I think -- those take while that fact, Murphy, John I'd didn't we cars, either to

David Motemaden

that then per sale And it. you on the Got cost spoke about.

ambient it just any they XX% could the high, like did quarter, in of it -- months? last you have competition also that think during they acquisition I quarter level, but last wondering here your talk below if was ratio. remain maybe if I'm And the returns. at X all fallen shopping about they sounds targeted stood like here where as just third some

Susan Griffith

try to to going I'm that. Yes. answer

little to is to I'm would our a we continue a elevated see see market. assume hard going bit. up breaking You on to side. were I shopping, continue say that

And new to bit little are also right we've to a equate away with delayed response, on in that. of apps both some which answer -- course, our sort of side, in we we direct so and such earlier I the that then highest prospects, our our an got but And which agency are NPX, which, see again, we're high direct response. leverage going growth the talked

and increased believe in And X that we'll is seeing the response we're because so even quarter spend we've shopping up that still on shopping. ad, with we spent delayed ambient the amount still

a And we So bit. were answered up you because want feel question question? Does breaking I your good about little that. I answer make sure to that your

David Motemaden

that Is how had the of shopping. third asked targeted is on below the does your help in just year. below spend, acquisition per ambient the quarter, the that think much I it first on pretty Yes, target? the half was I just still below in far sale cost XX%

Susan Griffith

it's TAC. is still say I'll that below

our just So it -- target said, again, X business still continue media an below quarter like we had cost. for and acquisition And Pat review. incredible our is CPS X-day

understand reach to more doing continue to reach all and the with efficient get We across the want board. that to consumers we exactly how

a but shopping. that able normally, for there's and we ways mass of on many we'll consumers other talk to are I so media the about list be think our spend, that's portion who short are spend,

at we CPS So where about now good feel right TAC. with we're below

Operator

line with Brian the of from comes UBS. question next Meredith Our

Brian Meredith

you hoping of in function months. insurance, could been perspective auto this hard you XX Is market bit Is the a it comment it? sustainable? we've this the about little something for favorable your what call it, is think on is was I last really seeing Tricia, a frequency

Susan Griffith

Brian. Thanks,

seen we've that our really what us, of to For is the mix. proportion biggest equated is

Our preferred increased. mix has

And so again, bit a We're frequency. before, [ less but a ]. than were lower obviously we negative X% that's still, obviously negative little

always to So want value. as a lifetime our -- and Obviously, target we make the customers we on year continue on that calendar profit put both will more watch to grow margins, book. we and

Brian Meredith

Got you.

question, second forward, book then yields portfolio? uplift just going some And you. where the money think? in relative do book new in Got you Is yields there mix. yields right So quickly, still investment to now

Susan Griffith

yes, on John, always performance. been Bauer money on happy we've detail. been let And of talk. these -- never John we've he's go gets calls the into to invest I'll and But higher-yielding let new into to Yes. I'll that you get some able

Jonathan Bauer

Yes. Thanks very much.

seeing throughout as of cutting last the the lot the in towards headed you've of As been course Fed rates the -- few interest and rates. over we but volatility quite certainly, election especially there's been over the years, few started last the months, a last

portfolio, little For us, years. know, short we a relatively you a over bit X duration as have just

are as Right risen be going and X end underlying well other And money versus so have we of out relatively conservative adjust and into would interest has money of then products. as yields of really to and since significantly now, the into quite treasuries allocate book cash allocation. yields things new the a the which level rates, that the third quarter risk the we the

that time. we increase if that, to were so would And over shift book yields

interest underlying But would book were in increase for investment strategy will yields want our return point driving I likely rate that if But prospective obviously, to a of -- in total this around Progressive, is maintain force the just has the out strategy. level. movement to rates they

really your of total we is yield term. answer an decisions to book drive us, question? the that strongest make. But the the we're over So output return for longer looking the Does

Brian Meredith

terrific. Yes, That's does. it

Operator

line Our next Meyer of question with KBW. the comes Shields from

Meyer Shields

necessarily dependent? you've Lines profit sort isn't ordered like loss it margin about guess, talked outperformance will pairs of worth Progressive give that And fact ordered growth the could how us how by if we've of and the sometimes, is happened it. is surprised excess trends? where much much this Personal some maintain into year was it I hoping So the pairs I you of just And the insight trade-off

Susan Griffith

Well, I the many from more. think I margin think things. a little let weigh comes I'll in But so different Pat bit

spend are -- customers. more our if we efficient to So get in

et I premium every to of at roll say on dollar I would we look that. get and excess up, we we renewal could it cetera, to new what our based happen roll trends, think severity each go and to frequency So profits. come would customers, product, it more and say it the state, I each we call down wouldn't wouldn't business, -- and think what we spend outputs,

And our or will pull we'll back. either in get -- pull margin efficient more then back spend, if if we we're try inefficient to we our shrink --

We $X.XX. or it have different a But of at of all goes under we the as lot below fast umbrella as our really, grow can levers.

add want you to do Pat, anything?

Patrick Callahan

growth the wasn't the year. we're earlier seeing I expected would that And Yes. say that in

and have you knew we XXXX we of outsized down et as business So calendar growth. And profitability. competitive we verification tactics reports, the year slowing cetera, those up had the in frankly, more options, we when billing with shields . gotten seen, deliver reduced were to some we've see as

So saying can think and significantly produce I don't level of extended a growth this we period. think we we entered profit year the on

How is? how rates states. So now, that you a constantly shopping a in efficient media evolve there managers much product to right we've ambient is? mentioned, down see John And see competitive our small amount taken number of as environment spend our

and fast shopping levels service we staffing spend level us as we to our kind the rate as can period as And sure grow slower year, and we'll our enable levels of be come monitoring our make to. of into the

high So about year, really we're next into out this we've comps feel got coming great how and closing some year.

was the -- our the piece plan much in outset able as it wasn't capture to growth be to at ordered I is But this I growth that outperforming year. of And the the certainly think as don't pair with for we a with the shoppers. media have. the efficient of clicks competitors for in really rates rates or to raising restricting your new people becomes and access not when lot competing there's competitive But market business,

Susan Griffith

-- deep quarter about well when talked a or as that dive on ago. add we little would our media this I a we is had so What bit Yes.

flexible And because We years, of the last couple back pull had are unfortunately, with to we've so margins. spend. our media of

and turning that This having that things which team a for several we to his budget We been we a close media do and occasions me of open have and year, happen. key be not sort off and come to the up or year say, flexibility and we have that spigot year to open year, where this to up okay, at the increase on able being pretty budget on Pat the to to beginning do. But set quickly spigot. has this think a will of nimble

Meyer Shields

that reasonable Can you ratio? the that in steps helpful, us property. there's -- very shift very I are get combined What to detail. ongoing give insight That's know this appropriate mix some Okay. into targeted line obviously other are

Susan Griffith

rate the I increases Well, taking. definitely been it's we've think

bundled. the geographic owner-occupied and said, customers, I the actions, segmentation book is absolutely it's on have hail think sharing making with its And to with continue deepen I will It it's the like that wind deductibles. mix. agency that sure solid homes our are cost we

time, down. we So it's we It's one the the closely. I whole things very takes talked that about it confidence not we it's have team just slow a right. of we watch plethora But things one that thing. are all and And where before. have And of that where it are constantly just And of to things I will. should be, it people that get a should monitoring those it's --

Operator

next of with Our question the Mike Zaremski BMO. line comes from

Michael Zaremski

about even its frequency was your question I curve frequency, than As industry. in it relationships a follow-up mister to, Brian's the -- think the better

You partial the about than inflation towards just average severity a or line term mix talked helping. longer offset I'm curious, a should customer preferred of different just the preferred is the there book? the have higher trend

Susan Griffith

I in there's huge anything don't that. think

last trending can, come for us. And I has have years. it's what it's Diane, could write means, Sam, target be oddly to any profit risk with Robinsons preferred want think so do our the sure the more or XX that we're rate we the as over products also, that and It stickier could years. a margin. with long frequency we I'm where frequency -- because customers XX volatile at. reach that stable But other Wrights, we down been really, Obviously, -- products. not X been to looking business last as

are target we can that -- any open business as make as So consumer for for profit we margins. fully open long

Michael Zaremski

competitive follow-up environment. And gears my the switching is Okay. to as -- Got it.

you a sell more bundle share insurance are guys home Progressive they peer, average lot Auto. does, your about a bundles. think And home your I they than that on and we with and of increasing if obviously lot know So

larger of or some average it's think I lower much still, than competitors. your But your competitor

I'm customers? to causing of that is future, helping it. foreseeable you all increase if the of is market you be for than dynamic gain which all peers -- are, That home insurance and any So follow more to need given pricing is so kind environment curious, your is the for competitive your a still the hard bundled question, the will you my

Susan Griffith

Pat competitors differently. in. I I different it think I'll Yes. let because do hard mean, it's add

property, but growing paper. and not own have on their are Some

competitors in to Some and of grow, before a then of places us volatile are have in the position derisk weather. have but our that sort not necessarily the

when captive you bundled, long because a And some really look a agencies, time. they're for at are are bundled lot sticky

but when be more be profitable. want group of how we That obviously -- broad carriers make our bundle to or coverage, paper just be And to sure want sort has eventually, to able be want customers want to that why that's on where we we on bundle with. to and that's of stable We that where, whether we home developed the is -- the shop. work to

our And we we it's what but with HomeQuote Explorer BusinessQuote sure or that to want our whether -- Explorer. when AutoQuote people call in, they can -- make Explorer, them give need,

care if us. or But And we'll businesses them with that with customers our we partner sometimes, not, of hopefully, with. it's take

percentage that environment to, we here, game we want we with are so same, of playing decisions as we firm. competitive that term share. the take And don't right, really the long to Clearly, prudent market So and the we for property But the evolve look but have especially probably we don't. slowly make our we you're own mature.

Douglas Constantine

our been have question. to appears That final

the apologize scripts. that closing the technical our for event. call over we for back difficulties. to will So I concludes you Again, Victoria,

Operator

Investor Investor a Third event available about the section Quarter Information That website year. Progressive Event. Corporation's on next the of the the Progressive's will for be Relations replay concludes of

now your lines. disconnect may You

The Progressive Corporation (PGR) 5 Nov 242024 Q3 Earnings call transcript