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Progressive Corporation

Progressive CorporationPGREarnings & Financial Report

NYSE · Financials · Fire, Marine & Casualty Insurance

The Progressive Corporation is an American insurance company. Progressive is currently the #2 auto insurer in the United States behind State Farm. The company was co-founded in 1937 by Jack Green and Joseph M. Lewis, and is headquartered in Mayfield, Ohio. The company insures passenger vehicles, motorcycles, recreational vehicles (RVs), trailers, boats, personal water craft (PWC), and commercial vehicles. Progressive also provides home, life, pet, and other types of insurance through select c...

What changed in Progressive Corporation's 10-K — 2024 vs 2025

Top changes in Progressive Corporation's 2025 10-K

190 paragraphs added · 190 removed · 166 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

107 edited+20 added−19 removed61 unchanged
Attract and Hire We employ extensive recruiting practices with a goal of developing qualified and deep candidate pools and attracting candidates from both established and new sources. We believe that our recruitment efforts generally have enabled us to present high-potential pools of job candidates to our hiring managers.
Attract and Hire We employ extensive recruiting practices with a goal of developing qualified and deep candidate pools and attracting candidates from both established and new sources. We believe that our recruitment efforts generally have enabled us to present pools of high-potential job candidates to our hiring managers.
Regulated areas include, among others: • licensing of insurers and agents, • capital and surplus requirements, • restrictions on marketing, • statutory accounting principles specific to insurance companies and the content of required financial and other reports, • requirements for establishing insurance reserves, • investments, • acquisitions of insurers and transactions between insurers and their affiliates, • limitations on rates of return or profitability, • rating criteria, rate levels, and rate changes, • insolvencies of insurance companies, • assigned risk programs, • authority to exit a business, and • numerous requirements relating to other areas of insurance operations, including: required coverages, policy forms, policy cancellations and non-renewals, underwriting standards, and claims handling.
Regulated areas include, among others: • licensing of insurers and agents, • capital and surplus requirements, • restrictions on marketing, • statutory accounting principles specific to insurance companies and the content of required financial and other reports, • requirements for establishing insurance reserves, • investments, • acquisitions of insurers and transactions between insurers and their affiliates, • limitations on rates of return or excess profitability, • rating criteria, rate levels, and rate changes, • insolvencies of insurance companies, • assigned risk programs, • authority to exit a business, and • numerous requirements relating to other areas of insurance operations, including: required coverages, policy forms, policy cancellations and non-renewals, underwriting standards, and claims handling.
Best), or was estimated using A.M. Best data as the primary source. • Special lines products represented the remaining personal vehicle net premiums written for the years mentioned above. Due to the seasonal 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.
Best), or was estimated using A.M. Best data as the primary source. - 1 - • Special lines products represented the remaining personal vehicle net premiums written for the years mentioned above. Due to the seasonal 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.
Chief Executive Officer • Chief Financial Officer • Personal Lines President • Chief Investment Officer • Commercial Lines President • Chief Human Resources Officer • Claims President • Chief Information Officer • Customer Relationship Management President • Chief Legal Officer • Chief Marketing Officer • Chief Strategy Officer Our insurance and claims organizations are generally managed on a state-by-state basis due to the nature of insurance, legal and regulatory requirements, and other local factors, and are supplemented by national operations and supported by our corporate functions.
Chief Executive Officer • Chief Financial Officer • Chief Marketing Officer • Chief Investment Officer • Personal Lines President • Chief Strategy and Finance Management Officer • Commercial Lines President • Chief Human Resources Officer • Claims President • Chief Information Officer • Customer Relationship Management President • Chief Legal Officer Our insurance and claims organizations are generally managed on a state-by-state basis due to the nature of insurance, legal and regulatory requirements, and other local factors, and are supplemented by national operations and supported by our corporate functions.
To further help our direct customers, we offer BusinessQuote Explorer ® (BQX), a digital application that allows small business owners to obtain quotes for our BOP product and the products offered from a select group of unaffiliated carriers. - 5 - Reinsurance Our reinsurance activity includes both transactions which are regulated and those that are non-regulated.
To further help our direct customers, we offer BusinessQuote Explorer ® (BQX), a digital application that allows small business owners to obtain quotes for our BOP product and the products offered from a select group of unaffiliated carriers. Reinsurance Our reinsurance activity includes both transactions which are regulated and those that are non-regulated.
Compensation and Benefits We seek to provide competitive pay through a combination of fixed and variable compensation and have designed our compensation programs for employees to earn above market pay when company performance warrants it. We publish, internally, our competitive annualized base pay ranges and annual cash incentive targets for virtually all of our positions.
Compensation and Benefits We seek to provide competitive pay through a combination of fixed and variable compensation and have designed our compensation programs for employees to earn above market total compensation when company performance warrants it. We publish, internally, our competitive annualized base pay ranges and annual cash incentive targets for virtually all of our positions.
Through this strategy, we seek to leverage our personal auto business with that of our personal property business, as well as insurance and non-insurance products offered by unaffiliated third parties, to provide our customers access to a range of products addressing their diverse needs, with the option to “bundle” certain of the products together.
Through this strategy, we seek to leverage our personal auto business with that of our personal property business, as well as insurance products and non-insurance services offered by unaffiliated third parties, to provide our customers access to a range of products addressing their diverse needs, with the option to “bundle” certain of the products together.
Portfolio is available for all agents appointed to write new business where we offer personal property products. • In the direct channel, we bundle Progressive personal auto with our personal property products in almost all states, as well as with homeowners and renters products provided by unaffiliated insurance carriers nationwide.
Portfolio is available for all agents appointed to write new business where we offer personal property products. - 3 - • In the direct channel, we bundle Progressive personal auto with our personal property products in almost all states, as well as with homeowners and renters products provided by unaffiliated insurance carriers nationwide.
See Note 6 – Loss and Loss Adjustment Expense Reserves in the Annual Report for a detailed discussion of our loss reserving practices and a reconciliation of our loss and LAE reserve activity, along with incurred and paid claims development by accident year for our segments, based on definitions pursuant to statutory accounting principles. - 11 - Human Capital We believe that our people and our culture remain our most significant competitive advantage, and that having the right people working together in the right way is critical to driving our results, building our enduring business, and creating long-term shareholder value.
See Note 6 – Loss and Loss Adjustment Expense Reserves in the Annual Report for a detailed discussion of our loss reserving practices and a reconciliation of our loss and LAE reserve activity, along with incurred and paid claims development by accident year for our segments, based on definitions pursuant to statutory accounting principles. - 10 - Human Capital We believe that our people and our culture remain our most significant competitive advantage, and that having the right people working together in the right way is critical to driving our results, building our enduring business, and creating long-term shareholder value.
The HQX online buy button is available in almost every state. In addition to being able to quote and purchase our personal property products on HQX, consumers are able to quickly and easily compare homeowners insurance online from Progressive and other carriers.
The HQX online buy button is available in almost every state. In addition to being able to quote our personal property products on HQX, consumers are able to quickly and easily compare homeowners insurance online from Progressive and other carriers.
The Progressive Corporation, together with its insurance and non-insurance subsidiaries and affiliates, comprise what we refer to as Progressive. Progressive’s vision is to become consumers’, agents’, and business owners’ number one destination for insurance and other financial needs.
The Progressive Corporation, together with its insurance and non-insurance subsidiaries, comprise what we refer to as Progressive. Progressive’s vision is to become consumers’, agents’, and business owners’ number one destination for insurance and other financial needs.
Our non-regulated transactions represent voluntary external reinsurance arrangements related to portions of our personal property and Commercial Lines businesses; we do not reinsure our personal vehicles business outside of the regulated programs discussed above.
Our non-regulated transactions represent voluntary external reinsurance arrangements related to portions of our personal property and Commercial Lines businesses; we generally do not reinsure our personal vehicles business outside of the regulated programs discussed above.
Included in the occurrence XOL, from June 1, 2024 through December 31, 2024, we had shared limit coverage in our reinsurance program that provided $175 million of coverage for named storms. This reinsurance arrangement can, depending on the circumstances, provide additional coverage for a significant covered event, or provide coverage for aggregate losses under our occurrence XOL retention.
Included in the occurrence XOL, from June 1, 2025 through December 31, 2025, we had shared limit coverage in our reinsurance program that provided $175 million of coverage for named storms. This reinsurance arrangement can, depending on the circumstances, provide additional coverage for a significant covered event, or provide coverage for aggregate losses under our occurrence XOL retention.
During 2024, we used independent claim adjusters opportunistically in our vehicle businesses to help support our claim employees in managing our claims inventory and to timely respond to our customers impacted by certain catastrophe events. While not intended to be a significant part of our claims handling model for these businesses, we may use independent adjusters from time to time.
During 2025, we used independent claim adjusters opportunistically in our vehicle businesses to help support our claim employees in managing our claims inventory and to timely respond to our customers impacted by certain catastrophe events. While not intended to be a significant part of our claims handling model for these businesses, we may use independent adjusters from time to time.
Service Businesses Our service businesses, which represented less than 1% of our total revenues at December 31, 2024, 2023, and 2022, and did not have a material effect on our overall operations, primarily include our commission- or fee-based businesses, where we often act as an agent for other insurance companies.
Service Businesses Our service businesses, which represented less than 1% of our total revenues at December 31, 2025, 2024, and 2023, and did not have a material effect on our overall operations, primarily include our commission- or fee-based businesses, where we often act as an agent for other insurance companies.
We offer our commercial auto products in all states, excluding the District of Columbia. Our commercial auto customers insure approximately two vehicles per policy, excluding large fleet policies. During 2024, we wrote about 90% of our commercial auto business through the agency channel, excluding transportation network company (TNC), which is all written through the direct channel.
We offer our commercial auto products in all states, excluding the District of Columbia. Our commercial auto customers insure approximately two vehicles per policy, excluding large fleet policies. During 2025, we wrote about 90% of our commercial auto business through the agency channel, excluding transportation network company (TNC) business, which is all written through the direct channel.
Additionally, we have an “open door” policy that empowers every employee to reach out to any manager or any human resource representative when they have a question or concern or they want to share an idea. We also provide a confidential Alertline that is available for employees and others who want to raise a concern anonymously.
Additionally, we have an “open door” policy that empowers every employee to reach out to any manager or any human resources representative when they have a question or concern or they want to share an idea. We also provide a confidential Alertline that is available for employees and others who want to raise a concern anonymously.
Information on our website does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Progressive filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate such information by reference in such a filing. - 14 -
Information on our website does not constitute soliciting material and should not be deemed filed or incorporated by reference into any other Progressive filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent we specifically incorporate such information by reference in such a filing. - 13 -
Our health and wellness offerings include on-site fitness centers, a medical clinic, and health seminars. We provide several on-site and online offerings, such as fitness classes and health discussions, to meet the needs of our employees who are working remotely. We continue to offer a variety of health and wellness programs accessible to employees working from the office or remotely.
Our health and wellness offerings include on-site fitness centers, medical clinics, and health seminars. We provide several on-site and online offerings, such as fitness classes and health discussions, to meet the needs of our employees who are working remotely. We continue to offer a variety of health and wellness programs accessible to employees working from the office or remotely.
ITEM 1. BUSINESS General Development of Business The Progressive Corporation, an insurance holding company, has insurance and non-insurance subsidiaries and affiliates (references in this Item to subsidiaries includes affiliates as well). Our insurance subsidiaries write personal and commercial auto insurance, personal residential property insurance, and insurance for motorcycles, watercraft, and other recreational vehicles.
ITEM 1. BUSINESS General Development of Business The Progressive Corporation, an insurance holding company, has insurance and non-insurance subsidiaries and affiliates (references in this Item to subsidiaries include affiliates as well). Our insurance subsidiaries write personal and commercial auto insurance, personal residential property insurance, and insurance for motorcycles, watercraft, and other recreational vehicles.
As part of employee compensation, nearly all Progressive people participate in our annual cash incentive program, named Gainshare, which rewards the growth and profitability of our insurance businesses. We believe Gainshare contributes to the cooperative and collaborative way we work together and, in part, defines our culture.
As part of employee compensation, nearly all Progressive people participate in our annual cash incentive program, named Gainshare, which measures the growth and profitability of our insurance businesses. We believe Gainshare contributes to the cooperative and collaborative way we work together and, in part, defines our culture.
We write our personal vehicle insurance in all states, however, our special lines products are not written in the District of Columbia. • Personal auto insurance represented 95% of our total personal vehicle net premiums written in 2024, and 94% in both 2023 and 2022.
We write our personal vehicle insurance in all states, however, our special lines products are not written in the District of Columbia. • Personal auto insurance represented 95% of our total personal vehicle net premiums written in both 2025 and 2024, and 94% in 2023.
During 2024, no losses were ceded under the occurrence XOL program that is currently in place or the occurrence XOL that was in place from June 1, 2023 through May 31, 2024.
During 2025, no losses were ceded under the occurrence XOL program that is currently in place or the occurrence XOL that was in place from June 1, 2024 through May 31, 2025.
Although the ratio of written premiums to surplus that the regulators will allow is a function of a number of factors (including applicable laws, the type of business being written, the adequacy of the insurer’s reserves, and the quality of the insurer’s assets), the annual net premiums that an insurer may write historically have been perceived to be limited to a specified multiple of the insurer’s total surplus, generally 3 to 1 for property and casualty insurance, which is generally the target for our vehicle businesses; however, certain states have permitted us to target a premiums-to-surplus ratio for our personal vehicle insurance companies in excess of 3 to 1 based on our strong financial condition.
Although the ratio of written premiums to surplus that the regulators will allow is a function of a number of factors (including applicable laws, the type of business being written, the adequacy of the insurer’s reserves, and the quality of the insurer’s assets), the annual net premiums that an insurer may write historically have been perceived to be limited to a specified multiple of the insurer’s total surplus, generally 3 to 1 for property and casualty insurance, which is generally the target for our vehicle businesses; however, two states have permitted us to target a premiums-to-surplus ratio for our personal vehicle insurance companies to a maximum ratio of 3.5 to 1 based on our strong financial condition.
For our Personal Lines property business, we manage claims through a network of independent claim field adjusters and employee claim representatives who manage the overall claims process. As of December 31, 2024, we had about 1,250 claim employees to handle our personal property claims. Competitive Factors The insurance markets in which we operate are highly competitive.
For our Personal Lines property business, we manage claims through a network of independent claim field adjusters and employee claim representatives who manage the overall claims process. As of December 31, 2025, we had about 1,270 claims employees to handle our personal property claims. Competitive Factors The insurance markets in which we operate are highly competitive.
Agency Distribution Channel • The agency personal vehicle business includes business written by our network of more tha n 40,000 independent insurance agencies located throughout the U.S., including brokerages in New York and California.
Agency Distribution Channel • The agency personal vehicle business includes business written by our network of more tha n 40,000 independent insurance agencies located throughout the U.S., as well as brokerages in New York and California.
We have nine inclusive ERGs (Asian American Network, Disabilities Awareness Network, LGBTQ+ Network, Military Network, Network for Empowering Women, Parent Connection, Progressive African American Network, Progressive Latin American Networking Association, and Young Professionals Network), each one open to all employees at the company. We believe our - 12 - ERGs provide spaces for networking, understanding differences, and sharing experiences.
We have nine inclusive ERGs (Asian American Network, Disabilities Awareness Network, LGBTQ+ Network, Military Network, Network for Empowering Women, Parent Connection, Progressive’s African American Network, Progressive’s Latin American NETworking Association, and Young Professionals Network), and each one is open to all employees at the company. We believe our ERGs provide spaces for networking, understanding differences, and sharing experiences.
We receive commissions for the policies written under this program and allocate marketing and other administration costs associated with maintaining these programs.
We receive commissions for the policies written under this program and allocate marketing and other servicing costs associated with maintaining these programs.
We were the eleventh largest homeowners carrier in the U.S., based on 2023 premiums written, and we are currently unable to determine if we will hold that ranking for 2024. There are approximately 360 competitors in the homeowners insurance market nationwide and we compete with many of these companies.
We were the twelfth largest homeowners carrier in the U.S., based on 2024 premiums written, and we are currently unable to determine if we will hold that ranking for 2025. There are approximately 360 competitors in the homeowners insurance market nationwide and we compete with many of these companies.
There are approximately 340 competitors in the total U.S. commercial auto market. We primarily compete with about 60 other large companies/groups, each having over $200 million of commercial auto premiums written annually. Progressive and these leading commercial auto insurers comprise 87% of this market.
There are approximately 340 competitors in the total U.S. commercial auto market. We primarily compete with about 64 other large companies/groups, each having over $200 million of commercial auto premiums written annually. Progressive and these leading commercial auto insurers comprise 88% of this market.
In general, we retain approximately $1 million per occurrence on workers’ compensation through the use of excess of loss and quota-share reinsurance. For our TNC product, the amounts retained vary by state and cost-sharing agreements are in place with companies owned by the TNC company.
In general, we retain approximately $1 million per occurrence on workers’ compensation through the use of XOL and quota-share reinsurance. - 6 - For our TNC product, the amounts retained vary by state and cost-sharing agreements are in place with companies owned by the TNC company.
The total personal vehicle net premiums written through the agency channel represented 45% of our total personal vehicle volume in 2024, 46% in 2023, and 47% in 2022. • Our personal property business is primarily written through the independent agency channel and through select agents under our Platinum program as part of our Destination Era strategy, discussed below.
The total personal vehicle net premiums written through the agency channel represented 43% of our total personal vehicle volume in 2025, 45% in 2024, and 46% in 2023. • Our personal property business is primarily written through the independent agency channel and through select agents under our Platinum program as part of our Destination Era strategy, discussed below.
We invest in physical, emotional, and financial health of Progressive people by providing a broad range of benefits, including: medical, prescription drug, dental, and vision benefits; a 401(k) plan with up to a 6% company match; life insurance; long- and short-term disability insurance; and paid parental leave following birth, adoption, or placement of a foster child.
We invest in the health and wellbeing of Progressive people by providing a broad range of benefits, including: medical, prescription drug, dental, and vision benefits; a 401(k) plan with up to a 6% company match; life insurance; long- and short-term disability insurance; and paid parental leave following birth, adoption, or placement of a foster child.
Our 2024 engagement and culture survey results placed us in the top 2% of all companies using the survey, which is designed by a nationally-known third party and administered in like form to over 1,200 employers in the United States. We use the results, along with other information, to evaluate our human capital strategies and the health of our culture.
Our 2025 engagement and culture survey results placed us in the top 1% of all companies using the survey, which is designed by a nationally-known third party and administered in like form to over 1,000 employers in the United States. We use the results, along with other information, to evaluate our human capital strategies and the health of our culture.
The total net premiums written by the direct vehicle business represented 55% of our total personal vehicle volume in 2024, 54% in 2023, and 53% in 2022. • Our direct personal property business is written by us over the phone and through HomeQuote Explorer ® (HQX), our multi-carrier, direct-to-consumers online personal property offering.
The total net premiums written by the direct personal vehicle business represented 57% of our total personal vehicle volume in 2025, 55% in 2024, and 54% in 2023. • Our direct personal property business is written by us over the phone and through HomeQuote Explorer ® (HQX), our multi-carrier, direct-to-consumers online personal property offering.
The occurrence XOL program, which is in place from June 1, 2024 through May 31, 2025, supports the goal of maintaining adequate capital and is comprised of privately placed reinsurance, reinsurance placed through catastrophe bond transactions, and coverage obtained through the FHCF.
The occurrence excess of loss (XOL) program, which is in place from June 1, 2025 through May 31, 2026, supports the goal of maintaining adequate capital and is comprised of privately placed reinsurance, reinsurance placed through catastrophe bond transactions, and coverage obtained through the FHCF.
We ranked second in market share in the U.S. private passenger auto insurance market, based on 2023 premiums written, and we believe we continue to hold that position for 2024. There are approximately 240 competitors in this market.
We ranked second in market share in the U.S. private passenger auto insurance market, based on 2024 premiums written, and we believe we continue to hold that position for 2025. There are approximately 230 competitors in this market.
During 2024, no losses were ceded under this “hurricane season” coverage. We have renewed this coverage from June 1, 2025 through December 31, 2025 (i.e., the 2025 hurricane season) for $175 million of coverage. - 6 - During 2024, our personal property business also had an aggregate XOL program structure with multiple layers providing coverage for catastrophe losses and ALAE.
During 2025, no losses were ceded under this “hurricane season” coverage. We have renewed this coverage from May 31, 2026 through December 31, 2026 (i.e., the 2026 hurricane season) for $175 million of coverage. During 2025, our personal property business also had an aggregate XOL program structure with multiple layers providing coverage for catastrophe losses and ALAE.
In addition, there has been a proliferation of patents related to new ways in which technologies can affect competitive positions in the insurance industry. Several of our competitors have many more patents than we do.
In addition, there continues to be a proliferation of patents related to new ways in which technologies can affect competitive positions in the insurance industry. Several of our competitors have many more patents than we do.
Training and Development We actively foster a learning culture and offer several leadership development programs, including a program open to employees of all backgrounds with a focus on leading inclusively. Two of our career development boot camps (IT Programmer and Analyst) are intended to accelerate career opportunities.
We actively foster a learning culture and offer several leadership development programs, including a program open to employees with a focus on leading inclusively. Two of our career development boot camps (IT Programmer and Analyst) are intended to increase job learning and accelerate career opportunities.
Diversity, Equity, and Inclusion We believe that in order to be consumers’, agents’, and business owners’ number one destination for insurance and other financial needs, we need to anticipate and understand the needs of our customers. Therefore, we aspire to take full advantage of the rich diversity of our employees’ unique backgrounds, experiences, skills, talents, and perspectives.
Supporting An Inclusive Workplace We believe that in order to be consumers’, agents’, and business owners’ number one destination for insurance and other financial needs, we need to anticipate and understand the needs of our customers. Therefore, we aspire to take full advantage of the rich diversity of our employees’ unique backgrounds, experiences, perspectives, skills, and talents.
Our personal property business represented 5% of our total Personal Lines net premiums written in 2024, and 6% in both 2023 and 2022, with about 95% of the total personal property net premiums written attributable to the homeowners and renters products.
Our personal property business represented 4% of our total Personal Lines net premiums written in 2025, 5% in 2024, and 6% in 2023, with about 95% of the total personal property net premiums written attributable to the homeowners and renters products.
Progressive and the other leading 30 large companies/groups, each with over $800 million of premiums written annually, comprise about 80% of the market. We tend to see more personal property business written during the second and third quarters of the year based on the cyclical nature of property sales.
Progressive and the other leading 28 large companies/groups, each with over $1 billion of premiums written annually, comprise about 80% of the market. We tend to see more personal property business written during the second and third quarters of the year based on the cyclical nature of property sales.
Coverage for a second event (and, potentially, for subsequent covered events) under the occurrence XOL program would depend on several factors, including the location and the extent of covered losses of the earlier events in the contract period. Portions of our program include reinstatement limits providing coverage for subsequent events.
National Weather Service (named storms). - 5 - Coverage for a second event (and, potentially, for subsequent covered events) under the occurrence XOL program would depend on several factors, including the location and the extent of covered losses of the earlier events in the contract period. Portions of our program include reinstatement limits providing coverage for subsequent events.
The coverage limits, net of retention but including the shared limit coverage discussed below, in place at December 31, 2024, were as follows: • $2.1 billion for a first event in Florida; and • $1.8 billion for a first event outside of Florida.
The coverage limits, net of retention but including the shared limit coverage discussed below, in place at December 31, 2025, were as follows: • $2.2 billion for a first event in Florida; and • $2.0 billion for a first event outside of Florida.
Progressive and the other leading 15 private passenger auto insurers, each of which writes over $2.5 billion of premiums annually, comprise about 85% of this market. All industry data, including ranking and market share, based on premiums written, has been obtained directly from data reported by either SNL Financial or A.M. Best Company, Inc. (A.M.
Progressive and the other leading 15 private passenger auto insurers, each of which writes over $3 billion of premiums annually, comprise about 85% of this market. All industry data, including ranking and market share, based on premiums written, has been obtained directly from data reported by either S&P Global Market Intelligence or A.M. Best Company, Inc. (A.M.
Personal Lines Our Personal Lines operating segment writes insurance for personal autos and special lines products (e.g., recreational vehicles, such as motorcycles, RVs, and watercraft), collectively referred to as our personal vehicle business, and, beginning in the fourth quarter 2024, personal residential property insurance for homeowners and renters.
Personal Lines Our Personal Lines operating segment writes insurance for personal autos and special lines products (e.g., recreational vehicles, such as motorcycles, RVs, and watercraft), collectively referred to as our personal vehicle business, and personal residential property insurance for homeowners and renters.
The total personal property net premiums written through the agency channel represented 74% of our total personal property volume in 2024, 77% in 2023, and 75% in 2022. Direct Distribution Channel • The direct vehicle business includes business written directly by us online and over the phone.
The total personal property net premiums written through the agency channel represented 72% of our total personal property volume in 2025, 74% in 2024, and 77% in 2023. Direct Distribution Channel • The direct personal vehicle business includes business written directly by us online or by phone.
See Item 1A, Risk Factors below for more information. - 10 - Investments Our investment portfolio, which had a fair value of $80.3 billion at December 31, 2024, compared to $66.0 billion at December 31, 2023, consists of fixed-maturity securities, short-term investments, and equity securities (nonredeemable preferred stocks and common equity securities).
See Item 1A, Risk Factors below for more information. - 9 - Investments Our investment portfolio, which had a fair value of $97.4 billion at December 31, 2025, compared to $80.3 billion at December 31, 2024, consists of fixed-maturity securities, short-term investments, and equity securities (nonredeemable preferred stocks and common equity securities).
Smart Haul offers owner operators and small fleets the ability to receive discounts on their insurance by sharing their electronic logging device generated data with us. Snapshot ProView ® is the UBI program for commercial auto customers without their own electronic logging device.
Smart Haul ® is the UBI program that uses driving data from a motor carrier’s existing electronic-logging device. Smart Haul offers owner operators and small fleets the ability to receive discounts on their insurance by sharing their electronic-logging-device-generated data with us. Snapshot ProView ® is the UBI program for commercial auto customers without their own electronic logging device.
Progressive has ranked number one in the U.S. commercial auto market since 2015, and we believe that we continued to hold that position for 2024. - 4 - The core commercial auto business (which excluded TNC business and our Progressive Fleet & Specialty Programs (Fleet & Specialty) products) operates in the following commercial auto business market targets (BMT): • For-hire specialty – dump trucks, log trucks, and garbage trucks used by dirt, sand and gravel, logging, garbage/debris removal, and coal-type businesses, • For-hire transportation – tractors, trailers, and straight trucks primarily used by regional general freight and expeditor-type businesses and long-haul operators, • Tow – tow trucks and wreckers used in towing services and gas/service station businesses, • Contractor – vans, pick-up trucks, and dump trucks used by light contractors (e.g., painters, plumbers, landscapers), and heavy construction, and • Business auto – autos, vans, pick-up trucks used by small businesses (e.g., retailing, manufacturing, farming) and for-hire livery (e.g., non-fleet (i.e., five or fewer vehicles) taxis, black-car services, and airport taxis).
The core commercial auto business (which excludes TNC business and our Progressive Fleet & Specialty Programs (Fleet & Specialty) products) operates in the following commercial auto business market targets (BMT): • For-hire specialty – dump trucks, log trucks, and garbage trucks used primarily by dirt, sand and gravel, logging, garbage/debris removal, and coal-type businesses, • For-hire transportation – tractors, trailers, and straight trucks primarily used by regional general freight and expeditor-type businesses and long-haul operators, • Tow – tow trucks and wreckers used in towing services and gas/service station businesses, • Contractor – vans, pick-up trucks, and dump trucks used by light contractors (e.g., painters, plumbers, landscapers), and heavy construction, and • Business auto – autos, vans, pick-up trucks used by small businesses (e.g., retailing, manufacturing, farming) and for-hire livery (e.g., non-fleet (i.e., five or fewer vehicles) taxis, black-car services, and airport taxis).
Personal Property Programs The reinsurance program in our personal property business is designed to reduce overall risk while, to the extent of coverage purchased, protecting capital from the costs associated with catastrophic events. The personal property program includes contracts that cover multi-year periods.
Personal Property Programs The property reinsurance program is designed to reduce overall risk while, to the extent of coverage purchased, protecting capital from the costs associated with catastrophic events. The program provides coverage for our personal property business and certain BOP product coverages. The program includes contracts that cover multi-year periods.
The Commercial Lines business accounted for 15% of our total net premiums written in 2024, 16% in 2023, and 18% in 2022. Unless otherwise noted, the following discussion focuses on our commercial auto business and, therefore, excludes business owners’ policy (BOP) and workers’ compensation products, which are discussed below.
The Commercial Lines business accounted for 13% of our total net premiums written in 2025, 15% in 2024, and 16% in 2023. Unless otherwise noted, the following discussion focuses on our commercial auto business and, therefore, excludes business-related general liability and commercial property insurance (business owners’ policy (BOP)) and workers’ compensation products, which are discussed below.
See the “Reinsurance” section below for further discussion of our reinsurance programs. Our Personal Lines strategy is to be a competitively priced provider of a broad range of personal auto, special lines, and personal property insurance products with distinctive service, distributed through whichever channel the customer prefers, and bundled with other products when appropriate to match our customers’ needs.
Our Personal Lines strategy is to be a competitively priced provider of a broad range of personal auto, special lines, and personal property insurance products with distinctive service, distributed through whichever channel the customer prefers, and bundled with other products when appropriate to match our customers’ needs.
Some of the patents we currently hold include two patents on the Name Your Price ® functionality on our website (expiring in 2028 or after), a usage-based insurance patent (expiring in 2032 or after), three multi-product quoting patents (expiring in 2032 or after), three patents for our implementation of a mobile insurance platform and architecture (expiring in 2032 or after), a patent on our system of providing customized insurance quotes based on a user’s price and/or coverage preferences (expiring in 2033 or after), two patents for our loyalty call routing system (expiring in 2033 or after), two patents for a multivariate predictive system that processes usage-based data (expiring in 2035 or after), four patents for the implementation of chatbots in online quoting and servicing (expiring in 2038 or after), two patents for our Commercial Lines business classification system (expiring in 2039 or after), three patents for our automated document classification system (expiring in 2040 or after), and two patents for embedded quoting (expiring in 2043 or after).
Some of the patents we currently hold include two patents on the Name Your Price ® functionality on our website (expiring in 2028 or after), a usage-based insurance patent (expiring in 2032 or after), three multi-product quoting patents (expiring in 2032 or after), three patents for our implementation of a mobile insurance platform and architecture (expiring in 2032 or after), a patent on our system of providing customized insurance quotes based on a user’s price and/or coverage preferences (expiring in 2033 or after), two patents for our loyalty call routing system (expiring in 2033 or after), two patents for a multivariate predictive system that processes usage-based data (expiring in 2035 or after), four patents for the implementation of chatbots in online quoting and servicing (expiring in 2038 or after), two patents for our Commercial Lines business classification system (expiring in 2039 or after), three patents for our automated document classification system (expiring in 2040 or after), and two patents for embedded quoting (expiring in 2043 or after). - 7 - We have a substantial amount of “know-how” developed from years of experience with usage-based insurance, and from analyzing the data from billions of driving miles derived from our usage-based devices and our mobile app.
Employee retention is an important part of our strategy. Our annualized employee retention rate for 2024 was 89%, up three points from the prior year, and, as of December 31, 2024, more than 17,000 employees had over 10 years of tenure at the company. Promoting from within is also a key part of our strategy.
Employee retention is an important part of our strategy. As of December 31, 2025, our annualized retention rate was 90%, up 1% from the prior year, and more than 18,000 employees had over 10 years of tenure at the company. Promoting from within also is a key part of our strategy.
On a pretax total return basis (i.e., total investment income plus changes in net unrealized gains (losses) on our fixed-maturity securities), our investment portfolio generated investment income of $3.3 billion in 2024 and $3.8 billion in 2023, compared to an investment loss of $4.3 billion in 2022.
On a pretax total return basis (i.e., total investment income plus changes in net unrealized gains (losses) on our fixed-maturity securities), our investment portfolio generated investment income of $6.2 billion in 2025, $3.3 billion in 2024, and $3.8 billion in 2023.
Volume potential is driven by our price competitiveness, the actions of our competitors, brand recognition, and quality service delivered through our dedicated employees who embody the Progressive culture, among other factors. See “Competitive Factors” below for further discussion. - 2 - Our Personal Lines products are sold through both the agency and direct channels.
Volume potential is driven by our price competitiveness, the actions of our competitors, brand recognition, and quality service delivered through our employees who embody the Progressive culture, among other factors. See “Competitive Factors” below for further discussion.
Many of our leaders, including most executive team members, joined Progressive in a more junior position and advanced to significant leadership positions within the organization. In 2024, we filled over 75% of our open positions above entry level by promoting from within, including just over 2,100 managerial positions. As of December 31, 2024, we had about 66,300 employees.
Many of our leaders, including all executive team members, joined Progressive in a more junior position and advanced to significant leadership positions within the organization. In 2025, we filled over 81% of our open positions above entry level by hiring from within, including just over 2,200 managerial positions. As of December 31, 2025, we had about 70,000 employees.
RBC is determined by a series of dynamic surplus-related formulas that contain a variety of factors that are applied to financial balances based on the degree of certain risks, such as asset, credit, and underwriting risks.
RBC is determined by a series of dynamic surplus-related formulas that contain a variety of factors that are applied to financial balances based on the degree of certain risks, such as asset, credit, and underwriting risks. At December 31, 2025, our RBC ratios were in excess of minimum requirements.
As of December 31, 2024, we had nearly 7,100 Platinum agents. • We offer independent agents an agency quoting system that makes it easier for them to bundle multiple policies with us.
As of December 31, 2025, we had nearly 6,000 Platinum agents. • We offer independent agents a quoting system that makes it easier for them to bundle multiple policies with us.
New models are typically rolled out on a state-by-state basis and, as a result, we often have more than one product version in the marketplace at a time. During 2024, we rolled out new product models across our core commercial auto and our Fleet & Specialty medium fleet products.
New models are typically rolled out on a state-by-state basis and, as a result, we often have more than one product version in the marketplace at a time. During 2025, we began to roll out our next-generation-product models across our core commercial auto, medium fleet, and BOP products, expanding segmentation and pricing variables.
We believe this mobile app improves the user experience. In addition to the personal benefits for our customers, the data collected via the mobile app affords us a unique perspective on vehicle operations, accidents, and mobile device usage.
We offer Snapshot through our hardware-based and/or mobile-app versions in all states, other than California. We believe this mobile app improves the user experience. In addition to the personal benefits for our customers, the data collected via the mobile app affords us a unique perspective on vehicle operations, accidents, and mobile device usage.
Our People We believe that our culture and continued success has enabled us to create a workplace composed of highly talented people across diverse markets and with a broad range of backgrounds and experiences.
Our People We believe that our culture and continued success has enabled us to create a workplace composed of highly talented people across diverse markets and with a broad range of backgrounds and experiences. They create innovative products and services, serve our customers, and work hard to help us achieve our vision.
In addition, in some jurisdictions, the attorney general’s office may exercise certain supervisory authority over insurance companies and, from time to time, may investigate certain insurance company practices. Insurance departments establish and monitor compliance with capital and surplus requirements.
In addition, in some jurisdictions, the attorney general’s office may exercise certain supervisory authority over insurance companies and, from time to time, may investigate certain insurance company practices. Insurance departments establish and monitor compliance with capital and surplus requirements. One prominent ratio monitored by regulators is the amount of net premiums written as a ratio of surplus.
In the agency channel, some of our competitors have broad distribution networks of employed or captive agents. With widely available comparative rating services, consumers can easily compare prices among competitors. Many competitors invest heavily in advertising and marketing efforts and/or expanding their online or mobile service offerings.
In the agency channel, some of our competitors have broad distribution networks of employed or captive agents. With widely available comparative rating services, consumers can easily compare prices among competitors.
In turn, we train our hiring managers to identify and avoid unconscious biases they may have during the interview and selection process and the importance of employing individuals with different kinds of experiences and backgrounds. We believe these strategies collectively enhance our applicant pools and contribute to our continued success.
In turn, we train our hiring managers to identify and avoid unconscious biases they may have during the interview and selection process. We also train our hiring managers on the importance of employing individuals with different kinds of backgrounds, experiences, perspectives, and skills.
The layers for the aggregate XOL programs active in 2024 and 2025 provided coverage, as follows: Policy for claims occurring in the year ended December 31, 2025 2024 Coverage terms (millions) Modeled Loss First Layer Second Layer First Layer Second Layer Retention $665 $450 to $475 $525 $450 to $475 $525 Total coverage, net of retention $15 $75 $100 $85 $100 Per occurrence deductible before each loss could be considered for aggregation, dependent on the peril covered $0 $5 or $8 $20 or $25 $5 or $8 $20 or $25 Per event coverage limit, net of the per occurrence deductible, dependent on the peril covered $50 $43 or $45 $175 or $180 $43 or $45 $175 or $180 The first layer of coverage under the aggregate XOL program does not provide coverage for named storms.
The layers for the aggregate XOL programs active in 2025 and 2026 provided coverage, as follows: Policy for claims occurring in the year ended December 31, 2026 2025 Coverage terms (millions) First Layer Second Layer Third Layer Modeled Loss First Layer Second Layer Retention $550 $550 $750 $665 $450 to $475 $525 Per occurrence event retention limit, net of the per occurrence deductible $280 $280 $280 $50 $43 or $45 $175 or $180 Total coverage, net of retention $113 $125 $63 $15 $75 $100 Per occurrence deductible before each loss could be considered for aggregation $20 $20 $20 $0 $5 or $8 $20 or $25 For 2026, all layers include coverage for named storms and other types of perils (e.g., wildfires, winter storms, and severe thunderstorms).
The retention threshold for the BOP excess of loss agreement is $2 million, for each property loss. Lastly, for the workers’ compensation product, we have catastrophe workers’ compensation coverage up to $74 million per occurrence pursuant to a $20 million maximum one-life sublimit.
Lastly, for the workers’ compensation product, we have catastrophe workers’ compensation coverage up to $74 million per occurrence pursuant to a $20 million maximum one-life sublimit.
At December 31, 2024, our RBC ratios were in excess of minimum requirements. - 9 - Insurance companies are generally required to file detailed annual and other reports with the insurance department of each jurisdiction in which they conduct business.
Insurance companies are generally required to file detailed annual and other reports with the insurance department of each jurisdiction in which they conduct business.
Under the 2024 occurrence XOL program, we are responsible for the first $200 million of losses and allocated loss adjustment expenses (ALAE) for the first event. We may be responsible for additional losses if we experience more than two such events or if claims incurred exceed the maximum coverage limits of the reinsurance that is then in place.
We may be responsible for additional losses if we experience more than two such events or if claims incurred exceed the maximum coverage limits of the reinsurance that is then in place.
Our first ERGs launched in 2007, and 44% of Progressive people belong to at least one ERG as of December 31, 2024. Ethics Our Core Values are the foundation for our Code of Business Conduct and Ethics, which provides clear expectations for all our people and confirms our commitment to high ethical standards and compliance with legal requirements.
Ethics Our Core Values are the foundation for our Code of Business Conduct and Ethics, which provides clear expectations for all our people and confirms our commitment to high ethical standards and compliance with legal requirements.
The combined premiums-to-surplus ratio for all of our insurance companies was 2.7 to 1 at December 31, 2024. In addition, as of January 31, 2025 we had access to $3.9 billion of securities held in a non-insurance subsidiary, portions of which could be contributed to the capital of our insurance subsidiaries to support growth or for other purposes.
In addition, as of January 31, 2026 we had access to $5.5 billion of securities held in a non-insurance subsidiary, portions of which could be contributed to the capital of our insurance subsidiaries to support growth or for other purposes.
Moreover, our career development resource, “Career Central,” encourages employees to take control of their careers through career exploration guides, recorded career journeys, discovery questionnaires to guide employees to roles that match their skills, and more.
Moreover, we endeavor to provide employees with the tools and support to excel in their roles and build long-term careers at the company. Our professional development resource, “Career Central,” encourages employees to take control of their careers through career exploration guides, video insights, sample career journeys, discovery questionnaires to guide employees to roles that match their skills, and more.
Investment income is affected by the variability of cash flows to or from the portfolio, shifts in the type and quality of investments in the portfolio, changes in yield, and other factors.
Investment income is affected by the variability of cash flows to or from the portfolio, shifts in the type and quality of investments in the portfolio, changes in yield, and other factors. For securities related to our investment portfolios, total investment income includes interest, dividends, accretion, amortization, and total net realized gains (losses) on securities.
Total investment income, before expenses and taxes, was $3.1 billion in 2024, compared to investment income of $2.3 billion in 2023 and an investment loss of $0.7 billion in 2022.
Total investment income, before expenses and taxes, was $4.3 billion in 2025, $3.1 billion in 2024, and $2.3 billion in 2023.
Engage and Retain We understand that engaged employees are more productive, provide better service to our customers, and are more likely to stay with Progressive. Each year, we survey our people to measure their engagement.
We believe these strategies collectively enhance our ability to hire the best candidate for each of our openings and contribute to our continued success. Engage and Retain We appreciate that engaged employees are more productive, provide better service to our customers, and are more likely to stay with Progressive. Each year, we survey our people to measure their engagement.
In addition, California and Florida treat certain of our subsidiaries as domestic insurers for certain purposes under their “commercial domicile” laws. Insurance laws impose numerous requirements, conditions, and limitations on the operations of insurance companies. Insurance departments have broad regulatory powers relating to those operations.
Our domestic insurance subsidiaries are domiciled in the states of Florida, Illinois, Indiana, Louisiana, Michigan, New Jersey, New York, Ohio, Texas, and Wisconsin. In addition, California and Florida treat certain of our subsidiaries as domestic insurers for certain purposes under their “commercial domicile” laws. Insurance laws impose numerous requirements, conditions, and limitations on the operations of insurance companies.
We also offer workers’ compensation insurance tailored for the transportation industry. Our offering includes loss prevention services that promote safe operations and dedicated claims-handling specialists. This product is available through a limited network of licensed brokers and includes options ranging from guaranteed premium cost plans to loss dependent plans, to meet the varying needs of small to large trucking fleets.
This product is available through a limited network of licensed brokers and includes options ranging from guaranteed premium cost plans to loss dependent plans, to meet the varying needs of small to large trucking fleets.
No losses were ceded under this aggregate XOL agreement during 2024. In January 2025, we entered into a new aggregate XOL for claims occurring in 2025. As part of the excess of loss program for 2025, we also entered into a severe convective storm modeled loss aggregate cover.
No losses were ceded under this aggregate XOL agreement during 2025. In January 2026, we entered into a new aggregate XOL for claims occurring in 2026.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Such attacks or actions may include attempts to: • access our systems • improperly use, steal, sell, corrupt, or destroy data or information, including our intellectual property, financial data, or the personal information of our customers, employees, or other individuals • misappropriate funds or extract ransom payments • commit fraud • disrupt or shut down our systems • deny customers, agents, brokers, or others access to our systems • infect our systems with viruses or malware Some of our systems and operations rely on third-party vendors, through either a connection to, or an integration with, those third parties’ systems or contracted personnel.
Such attacks or actions may include attempts to: • access our systems • improperly access, use, steal, sell, corrupt, or destroy data or information, including our intellectual property, financial data, or the personal information of our customers, employees, or other individuals • misappropriate funds or extract ransom payments • commit fraud • disrupt or shut down our systems • deny customers, agents, brokers, or others access to our systems • infect our systems with viruses or malware Some of our systems and operations rely on third-party vendors, through either a connection to, or an integration with, those third parties’ systems or contracted personnel.
Our brand and reputation also could be adversely affected by situations that reflect negatively on us, whether due to our business practices, adverse financial developments, perceptions of our corporate governance, perceptions of our purpose-driven brand, how we address employee matters and concerns, our approach to environmental, social, sustainability and corporate responsibility matters, investments in our portfolio, the conduct of our officers, directors, or employees, or other causes.
Our brand and reputation also could be adversely affected by situations that reflect negatively on us, whether due to our business practices, adverse financial developments, perceptions of our corporate governance, perceptions of our purpose-driven brand, how we address employee matters and concerns, our approach to environmental and social (Sustainability) and corporate responsibility matters, investments in our portfolio, the conduct of our officers, directors, or employees, or other causes.
Risks associated with these developments include: • our increasing reliance on third-party systems including “cloud computing” environments and software as a service applications • the development of new modes of communication • changing insurance shopping trends • our understanding of the operations and needs of significant customers • the availability and uses of very large volumes of data and the challenges relating to analyzing those data sets, including the availability of sufficient internal and external talent that understand and can manage the complexity and related risks Complexity may, among other potential difficulties, create barriers to innovation or the provision of high-quality products and customer and agent experiences with the speed and agility that may be required; require us to modify our business practices, adopt new systems or technology, or replace outdated systems or technology, or upgrade systems or technology to enhance the scale, performance or functionality, each at significant expense; and lead to increased difficulty in executing our business strategies.
Risks associated with these developments include: • our increasing reliance on third-party systems including “cloud computing” environments and software as a service applications • the development of new modes of communication • changing insurance shopping trends • our understanding of the operations and needs of significant customers • the availability and uses of very large volumes of data and the challenges relating to analyzing those data sets, including the availability of sufficient internal and external talent that understand and can manage the complexity and related risks Complexity and legacy systems may, among other potential difficulties, create barriers to innovation or the provision of high-quality products and customer and agent experiences with the speed and agility that may be required; require us to modify our business practices, adopt new software, systems or technology, or replace outdated software, systems or technology, or upgrade systems or technology to enhance the scale, performance or functionality, each at significant expense; and lead to increased difficulty in executing our business strategies.
There is inherent uncertainty in the process of establishing property and casualty insurance loss reserves, which can arise from a number of factors which are, or can be, affected by both internal and external events including: • 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 inflationary pressures or other factors, for multiple products in multiple markets • unexpected changes in medical costs, auto repair costs, or the costs of construction labor and materials • the imposition and impacts of tariffs • labor shortages, which can impact loss expenses directly through higher labor costs, and indirectly through delays in services or through lower quality, as companies hire less experienced workers to perform services • unanticipated changes in governing statutes and regulations • new or changing interpretations of insurance policy provisions and coverage-related issues by courts - 16 - • the outcome of lawsuits against us or our competitors, including unanticipatedly high jury verdicts or punitive damage awards • 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, including those arising from severe weather or other catastrophe events • the accuracy and adequacy of actuarial techniques and databases used in estimating loss reserves • the accuracy of the modeling tools that we use, which rely on the assumption that past loss development patterns will persist into the future and vary in the rate at which they incorporate changes in data • the accuracy and timeliness of our estimates of loss and loss adjustment expenses as determined for different categories of claims The ultimate paid losses and loss adjustment expenses may deviate, perhaps substantially, from point-in-time estimates of such losses and expenses, as reflected in the loss reserves included in our financial statements.
There is inherent uncertainty in the process of establishing property and casualty insurance loss reserves, which can arise from a number of factors which are, or can be, affected by both internal and external events including: • 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 inflationary pressures or other factors, for multiple products in multiple markets • unexpected changes in medical costs, auto repair costs, or the costs of construction labor and materials • the imposition and impacts of tariffs • labor shortages, which can impact loss expenses directly through higher labor costs, and indirectly through delays in services or through lower quality, as companies hire less experienced workers to perform services • unanticipated changes in governing statutes and regulations • new or changing interpretations of insurance policy provisions and coverage-related issues by courts • the outcome of lawsuits against us or our competitors, including unanticipatedly high jury verdicts or punitive damage awards • 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, including those arising from severe weather or other catastrophe events • the accuracy and adequacy of actuarial techniques and databases used in estimating loss reserves • the accuracy of the modeling tools that we use, which rely on the assumption that past loss development patterns will persist into the future and vary in the rate at which they incorporate changes in data - 15 - • the accuracy and timeliness of our estimates of loss and loss adjustment expenses as determined for different categories of claims The ultimate paid losses and loss adjustment expenses may deviate, perhaps substantially, from point-in-time estimates of such losses and expenses, as reflected in the loss reserves included in our financial statements.
Each insurance subsidiary’s ability to pay dividends may be limited by one or more of the following factors: • 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 • 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 If we are unable to obtain capital when necessary to support our business, our financial condition and our ability to grow could be materially adversely affected.
Each insurance subsidiary’s ability to pay dividends may be limited by one or more of the following factors: • 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 • 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 - 25 - If we are unable to obtain capital when necessary to support our business, our financial condition and our ability to grow could be materially adversely affected.
In such cases, we would be selling products or services that are new to us, while our competitors could include large, well-financed companies with significant product and marketing experience in such businesses. - 20 - Historically, the auto and property insurance markets have been described as cyclical, with periods of relatively strong profitability being followed by increased pricing competition among insurers.
In such cases, we would be selling products or services that are new to us, while our competitors could include large, well-financed companies with significant product and marketing experience in such businesses. Historically, the auto and property insurance markets have been described as cyclical, with periods of relatively strong profitability being followed by increased pricing competition among insurers.
Our ability to do so may be impaired as a result of litigation against us, other judicial decisions, legislation or regulations, or other factors in the employment marketplace, as well as our failure to recognize and respond to changing trends and other circumstances that affect our employees or our culture, including any impact arising from a decrease in virtual and hybrid workers relative to recent market trends.
Our ability to do so may be impaired as a result of litigation against us, other judicial decisions, legislation or regulations, or other factors in the employment marketplace, as well as our failure to recognize and respond to changing trends and other circumstances that affect our employees or our culture, including any impact arising from a decrease - 21 - in virtual and hybrid workers relative to recent market trends.
The ability to discern at any point in time whether we are in a “hard” or “soft” market is often difficult, as such a conclusion represents an assessment of innumerable data points including, among others, the operating results of, and the dynamic competitive actions taken by, us and many competitors in multiple markets involving a variety of products.
The ability to discern at any point in time whether we are in a “hard” or “soft” market is often difficult, as such a conclusion represents an assessment of innumerable data points including, among others, the operating results of, and the dynamic competitive actions taken by, us and many competitors in multiple markets involving a variety of - 19 - products.
In either such event, our financial results, customer relationships, employee morale, and brand could be materially adversely affected. - 22 - We use third-party labor to meet a portion of our staffing needs. Any significant loss in access to qualified external talent on a cost-effective basis could have an adverse effect on our business.
In either such event, our financial results, customer relationships, employee morale, and brand could be materially adversely affected. We use third-party labor to meet a portion of our staffing needs. Any significant loss in access to qualified external talent on a cost-effective basis could have an adverse effect on our business.
The performance of the fixed-income portfolio is subject to a number of risks, including: • 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, the regulatory environment applicable to, or the - 24 - 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, the regulatory environment applicable to, or outlook for, those issuers, sectors, or industries. • Prepayment or extension risk – applicable to certain securities in the portfolio, such as asset-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.
The performance of the fixed-income portfolio is subject to a number of risks, including: • 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, the regulatory environment applicable to, 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, the regulatory environment applicable to, or outlook for, those issuers, sectors, or industries. - 23 - • Prepayment or extension risk - applicable to certain securities in the portfolio, such as asset-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.
Depending on the impact of any of these factors, we may not be able to obtain reinsurance coverage in the future at all or with commercially reasonable rates, terms, and conditions. The unavailability and/or increased cost of reinsurance could adversely affect our business volume, profitability, or financial condition. III.
Depending on the impact of any of these factors, we may not be able to obtain reinsurance coverage in the future at all or with commercially reasonable rates, terms, and conditions. The unavailability and/or increased cost of reinsurance could adversely affect our business volume, profitability, or financial condition. - 16 - III.
Any such negative impact or event could decrease demand for our products or services, create difficulties in our ability to recruit and retain employees, negatively impact our stock price, and lead to greater regulatory scrutiny of our businesses, among other things. - 19 - Our success depends on our ability to innovate effectively and respond to our competitors’ initiatives.
Any such negative impact or event could decrease demand for our products or services, create difficulties in our ability to recruit and retain employees, negatively impact our stock price, and lead to greater regulatory scrutiny of our businesses, among other things. Our success depends on our ability to innovate effectively and respond to our competitors’ initiatives.
We do not provide earnings estimates to the market and do not comment on earnings estimates by analysts. As a result, our reported results for a particular period may vary, perhaps significantly, from investors’ expectations, which could result in significant volatility in the price of our equity or debt - 27 - securities.
We do not provide earnings estimates to the market and do not comment on earnings estimates by analysts. As a result, our reported results for a particular period may vary, perhaps significantly, from investors’ expectations, which could result in significant volatility in the price of our equity or debt securities.
In addition, innovations by competitors or other market participants may increase the level of competition in the industry. If we fail to respond appropriately in a timely manner to those innovations and also to the evolving customer preferences, our competitive position and results may be materially adversely affected.
In addition, innovations by competitors or other market participants may increase the level of - 18 - competition in the industry. If we fail to respond appropriately in a timely manner to those innovations and also to the evolving customer preferences, our competitive position and results may be materially adversely affected.
In such an event, unless and until additional sources of capital are secured, we may be limited in - 26 - our ability, or unable, to service our debt obligations, pay dividends, grow our business, pay our other obligations when due, or engage in other corporate transactions.
In such an event, unless and until additional sources of capital are secured, we may be limited in our ability, or unable, to service our debt obligations, pay dividends, grow our business, pay our other obligations when due, or engage in other corporate transactions.
Insurance laws and regulations may, among other things, limit an insurer’s ability to underwrite and price risks accurately, prevent the insurer from obtaining timely rate changes to respond to increased or decreased costs, delay or restrict the ability to discontinue or exit unprofitable businesses or jurisdictions, impose marketing restrictions or requirements related to the use of artificial intelligence and third-party data, prevent insurers from terminating policies under certain circumstances, dictate or limit the types of investments that an insurance company may hold, and impose specific requirements relating to information technology systems and related cybersecurity risks.
Insurance laws and regulations may, among other things, limit an insurer’s ability to underwrite and price risks accurately, prevent the insurer from obtaining timely rate changes to respond to increased or decreased costs, delay or restrict the ability to discontinue or exit unprofitable businesses or jurisdictions, limit the profit an insurer may earn, impose marketing restrictions or requirements related to the use of artificial intelligence and third-party data, prevent insurers from terminating policies under certain circumstances, dictate or limit the types of investments that an insurance company may hold, and impose specific requirements relating to information technology systems and related cybersecurity risks.
The Progressive Corporation and/or its subsidiaries are named as defendants in class actions, collective actions, representative actions, and other lawsuits challenging various aspects of the subsidiaries’ business operations. Certain pending lawsuits are described in Note 12 – Litigation in the Annual Report.
The Progressive Corporation and/or its subsidiaries are named as defendants in class actions, collective actions, representative actions, and individual and other lawsuits challenging various aspects of the subsidiaries’ business operations. Certain pending lawsuits are described in Note 12 – Litigation in the Annual Report.
Many of the factors that could lead to the invalidity, challenge, or recapture of tax credits are beyond our control. The inability to realize these tax credits and other tax benefits could have a material adverse impact on our financial condition. VII.
Many of the factors that could lead to the invalidity, challenge, or recapture of tax credits are beyond our control. The inability to realize these tax credits and other tax benefits could have a material adverse impact on our financial condition. - 26 - VII.
That underwriting capacity can be influenced by - 17 - several factors, including industry losses, changes in legal and regulatory guidelines, and the occurrence of significant reinsured events, such as weather-related catastrophes, among other things.
That underwriting capacity can be influenced by several factors, including industry losses, changes in legal and regulatory guidelines, and the occurrence of significant reinsured events, such as weather-related catastrophes, among other things.
The property and casualty insurance industry is a relatively mature industry, in which brand recognition, marketing skills, innovation, operational effectiveness, pricing, scale, and cost control are major competitive factors.
The property and casualty insurance industry is a mature industry, in which brand recognition, marketing skills, innovation, operational effectiveness, pricing, scale, and cost control are major competitive factors.
Our success depends on our ability to attract, develop, compensate, motivate, and retain talented employees, including executives, other key managers, and employees with strong technological, analytical, and other skills and know-how necessary for us to run our insurance businesses, investment operations, and corporate functions, assess potential expansion into new products and business areas, and adapt to technological trends in our industry.
Our success depends on our ability to attract, develop, compensate, motivate, and retain talented employees, including executives, other key managers, and employees with strong technical, analytical, and other skills and know-how necessary for us to run our insurance businesses, investment operations, and corporate functions, assess potential expansion into new products, services, and business areas, and adapt to technological trends in our industry.
Due to our focus on the long-term value of the enterprise, similar tradeoffs may be involved in our consideration of the interests of other stakeholders, including our employees, customers, agents, suppliers, and communities, as well as whether and how we respond to or address ESG, sustainability, and corporate responsibility initiatives, programs and efforts and other public policy matters that impact us.
Due to our focus on the long-term value of the enterprise, similar tradeoffs may be involved in our consideration of the interests of other stakeholders, including our employees, customers, agents, suppliers, and communities, as well as whether and how we respond to or address Sustainability, corporate governance, and corporate responsibility initiatives, programs and efforts and other public policy matters that impact us.
Since GenAI is subject to public debate, and depending on how observers view our development and use of AI, we could be subject to criticism or experience an adverse impact on our brand or reputation, which could decrease demand for our products or services, create difficulties in our ability to recruit and retain employees and lead to greater regulatory scrutiny of our businesses.
Since Advanced AI is subject to public debate, and depending on how observers view our development and use of AI, we could be subject to criticism or experience an adverse impact on our brand or reputation, which could decrease demand for our products or services, create difficulties in our ability to recruit and retain employees and lead to greater regulatory scrutiny of our businesses.
Our loss of certain executives and key employees, or the failure to attract or retain talented executives, managers, and employees with varied backgrounds, skills, knowledge, and experiences, could have a material adverse effect on our business. These risks may be heightened when United States labor markets, or key segments of those markets, are especially competitive.
Our loss of certain executives and key employees, or the failure to attract or retain talented executives, managers, and employees with varied and appropriate backgrounds, experiences, knowledge, perspectives, and skills, could have a material adverse effect on our business. These risks may be heightened when United States labor markets, or key segments of those markets, are especially competitive.
The value of securities held in our portfolio could be materially adversely impacted as issuers or the businesses or assets underlying such securities are faced with new, potentially conflicting, laws or regulations or initiatives by regulators, investors, activists, or others, including those addressing ESG, sustainability, corporate responsibility or other public policy concerns.
The value of securities held in our portfolio could be materially adversely impacted as issuers or the businesses or assets underlying such securities are faced with new, potentially conflicting, laws or regulations or initiatives by regulators, investors, activists, or others, including those addressing Sustainability, corporate governance, corporate responsibility or other public policy concerns.
Similarly, we could also face pressures from other stakeholders that seek to influence our investment decisions. These factors could cause a decline in the value of investments held in our portfolio, or cause us to change our investment strategy, which could increase our costs or reduce our returns relative to returns from other available investment opportunities. - 25 - V.
Similarly, we could also face pressures from other stakeholders that seek to influence our investment decisions. These factors could cause a decline in the value of investments held in our portfolio, or cause us to change our investment strategy, which could increase our costs or reduce our returns relative to returns from other available investment opportunities. - 24 - V.
Our ability to price accurately is subject to a number of risks and uncertainties, including, without limitation: • 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 - 15 - • 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 • 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 severe weather, and other catastrophe events, which may become more severe and less predictable as a result of climate change • 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 epidemics, pandemics, other widespread health risks, or changes in oil and gas prices, among other factors, changes in residential occupancy patterns, and the 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 healthcare laws or regulations • unforeseen disruptive technologies and events • the ability to understand the risk profile of significant customers, such as transportation network companies • unanticipated changes in auto repair costs, auto parts prices, used car prices, construction requirements, labor and materials costs, and the imposition and impacts of tariffs We are seeing various insurance regulations, legislative and regulatory challenges, political initiatives, and other societal pressures that seek to limit or prohibit the use of specific rating factors in insurance policy pricing, such as credit, education, and occupation.
Our ability to price accurately is subject to a number of risks and uncertainties, including, without limitation: • 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 - 14 - • our ability to reflect changes in reinsurance costs in a timely manner • 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 severe weather, and other catastrophe events, which may become more severe and less predictable as a result of climate change • 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 epidemics, pandemics, other widespread health risks, or changes in oil and gas prices, among other factors, changes in residential occupancy patterns, and the ridesharing economy • advancements in vehicle or home technology or safety features, such as accident and loss prevention technologies or the development of autonomous or semi-autonomous vehicles • unexpected changes in the medical sector of the economy, including medical costs and systemic changes resulting from national or state healthcare laws or regulations • unforeseen disruptive technologies and events • the ability to understand the risk profile of significant customers, such as transportation network companies • unanticipated changes in auto repair costs, auto parts prices, used car prices, construction requirements, labor and materials costs, and the imposition and impacts of tariffs Various insurance regulations, legislative and regulatory challenges, political initiatives, and other societal pressures seek to limit or prohibit the use of specific rating factors in insurance policy pricing, such as credit, education, and occupation.
These deficiencies could also undermine the associated predictions, analysis, or decisions GenAI applications produce or the business decisions we make based on this information. We could face challenges on whether we use AI in our business processes in a responsible, compliant, and effective manner.
These deficiencies could also undermine the associated predictions, analysis, or decisions Advanced AI applications produce or the business decisions we make based on this information. We could face challenges on whether we use AI in our business processes in a responsible, compliant, and effective manner.
Depending on the duration and severity of any such epidemic, pandemic, or other widespread health risk, and the nature and extent of governmental responses to it, our business, our operations, and our financial results could be negatively impacted. - 28 -
Depending on the duration and severity of any such epidemic, pandemic, or other widespread health risk, and the nature and extent of governmental responses to it, our business, our operations, and our financial results could be negatively impacted. - 27 -
See Management’s Discussion and Analysis of Financial Condition and Results of Operations – IV. Results of Operations– Investments in the Annual Report for additional discussion of the composition of our investment portfolio as of December 31, 2024, and of the market risks associated with our investment portfolio.
See Management’s Discussion and Analysis of Financial Condition and Results of Operations – IV. Results of Operations – Investments in the Annual Report for additional discussion of the composition of our investment portfolio as of December 31, 2025, and of the market risks associated with our investment portfolio.
As with many technological innovations, the growing development and use of generative AI (GenAI) presents additional risks that may adversely affect our business. GenAI might produce or reveal datasets that are flawed or insufficient or contain biased information, which could result in unintentionally and unfairly discriminatory outcomes in our business processes.
As with many technological innovations, the growing development and use of generative and agentic AI (Advanced AI) presents additional risks that may adversely affect our business. Advanced AI might produce or reveal datasets that are flawed or insufficient or contain biased information, which could result in unintentionally and unfairly discriminatory outcomes in our business processes.
The negative impacts of these or other events may be aggravated as consumers, regulators, and other stakeholders increase or change their expectations, or adopt conflicting expectations, regarding the conduct of large public companies, environmental, social, and governance (ESG) standards, and sustainability and corporate responsibility efforts, programs, and initiatives. These expectations and standards are continually evolving and not always clear.
The negative impacts of these or other events may be aggravated as consumers, regulators, and other stakeholders increase or change their expectations, or adopt conflicting expectations, regarding the conduct of large public companies, sustainability and corporate responsibility efforts, programs, and initiatives, and corporate governance and Sustainability standards. These expectations and standards are continually evolving and not always clear.
New regulations and societal pressures relating to ESG and other public policy matters could negatively impact our returns or cause us to change our investing strategies in ways that could negatively impact our results.
New regulations and societal pressures relating to Sustainability and other public policy matters could negatively impact our returns or cause us to change our investing strategies in ways that could negatively impact our results.
While at the onset of the venture we would expect these projects to provide long-term value, there can be no assurance that our expectations will be realized. - 23 - Intellectual property rights could affect our competitiveness and our business operations. There has been a proliferation of patents, both inside and outside the insurance industry, that significantly impacts our businesses.
While at the onset of the venture we would expect these projects to provide long-term value, there can be no assurance that our expectations will be realized. Intellectual property rights could affect our competitiveness and our business operations. There continues to be a proliferation of patents, both inside and outside the insurance industry, that significantly impacts our businesses.
All of these systems are subject to “cyberattacks” by third parties with substantial computing resources and capabilities, which are becoming more frequent and more sophisticated, and to unauthorized or illegitimate actions by employees, consultants, agents, and other persons with legitimate access to our systems.
All of these systems are subject to “cyberattacks” by third parties with substantial computing resources and capabilities, which have become more frequent and more sophisticated, and to unauthorized or illegitimate actions by employees, consultants, agents, and other persons with legitimate access to our systems.
Our workplace policies or perceptions of those policies by current and potential employees, including policies with respect to virtual, hybrid, and in-person work protocols, could impact our ability to attract, onboard, and retain talent with needed skills, knowledge, and experiences.
Our workplace policies or perceptions of those policies by current and potential employees, including policies with respect to virtual, hybrid, and in-person work protocols, could impact our ability to attract, onboard, and retain talent with desired experiences, knowledge, perspectives, and skills.
This information should be considered carefully together with the other information contained in this report and in the other reports and materials filed by us with the SEC, as well as news releases and other information we publicly disseminate from time to time. II.
This information should be considered carefully together with the other information contained in this report and in the other reports and materials filed by us with the Securities and Exchange Commission (SEC), as well as news releases and other information we publicly disseminate from time to time. II.
Intellectual property ownership rights, including those associated with related copyrights, patent rights, GenAI inputs for model training, and other GenAI outputs, have not been fully interpreted by courts or regulations.
Intellectual property ownership rights, including those associated with related copyrights, patent rights, Advanced AI inputs for model training, and other Advanced AI outputs, have not been fully interpreted by courts or regulations.
These assessments could have a material adverse impact on our profitability. Data privacy and security laws and regulations impose complex compliance and reporting requirements and challenges. Various jurisdictions have enacted or are considering privacy and security legislation or regulations. Each jurisdiction’s unique requirements, and the variations across the jurisdictions, present further ongoing compliance challenges.
Data privacy and security laws and regulations impose complex compliance and reporting requirements and challenges. Various jurisdictions have enacted or are considering privacy and security legislation or regulations. Each jurisdiction’s unique - 20 - requirements, and the variations across the jurisdictions, present further ongoing compliance challenges.
In addition, we seek to protect the security and confidentiality of data and information provided to our vendors under cloud computing or other arrangements through appropriate risk evaluation, security and financial due diligence, contracts designed to require high security and confidentiality standards, and review of third-party compliance with the required standards.
In addition, we seek to protect the security and confidentiality of data and information provided to our vendors under cloud computing or other arrangements through appropriate risk evaluation, security and financial due diligence, contracts designed to require high security and confidentiality standards, and review of third-party compliance with the required standards. - 17 - Our systems are being threatened on a regular basis and our efforts may be insufficient to prevent or defend against an attack.
However, we may not be able to obtain patents on these processes and practices, and defending our patents and other intellectual property rights against challenges, and enforcing and defending our rights, including, if necessary, through litigation, can be time consuming and expensive, and the results are inherently uncertain, which can further complicate business plans.
However, we may not be able to obtain patents on these processes and practices, and defending our patents and other intellectual property rights against challenges, and enforcing and defending our rights, including, if necessary, through litigation, can be time consuming and expensive, and the results are inherently uncertain, which can further complicate business plans. - 22 - Our development and use of new technology, such as generative and agentic artificial intelligence, may present additional risks, may not be successful, and could have a material adverse effect on our business .
Additionally, one or more of our key vendors may begin to use AI in their business in a manner that does not meet existing or rapidly evolving regulatory standards. Furthermore, our competitors or other third parties may be able to incorporate GenAI into their products more quickly, or more successfully, than us.
Additionally, one or more of our key vendors may begin to use AI in their business in a manner that does not meet existing or rapidly evolving regulatory standards.
Our information security efforts are designed to evolve with the changing security threat environment through ongoing assessment and measurement. This includes internal processes and technological defenses that are preventative or detective, and other controls designed to provide multiple layers of security protection.
This includes internal processes and technological defenses that are preventative or detective, and other controls designed to provide multiple layers of security protection.
Third-party risks may include, among other factors, the vendor’s lax security measures, data location uncertainty, and the possibility of data and information storage in inappropriate jurisdictions where laws or security measures may be inadequate. - 18 - We undertake substantial efforts and expend significant resources to protect our systems and sensitive or confidential data and information.
Although we may review and assess third-party vendor cybersecurity controls, our efforts may not be successful in preventing or mitigating the effects of such events. Third-party risks may include, among other factors, the vendor’s lax security measures, data location uncertainty, and the possibility of data and information storage in inappropriate jurisdictions where laws or security measures may be inadequate.
Moreover, inconsistencies in requirements among the various states, or between state and federal requirements, or changes in regulatory priorities, may further complicate our compliance efforts, potentially resulting in additional costs for us. - 21 - In addition, laws in certain jurisdictions mandate that insurance companies pay assessments in a number of circumstances, including potentially material assessments to pay claims upon the insolvency of other insurance companies or to cover losses in government-provided insurance programs for high-risk auto and homeowners’ coverages.
In addition, laws in certain jurisdictions mandate that insurance companies pay assessments in a number of circumstances, including potentially material assessments to pay claims upon the insolvency of other insurance companies or to cover losses in government-provided insurance programs for high-risk auto and homeowners’ coverages. These assessments could have a material adverse impact on our profitability.
As a result, we have been, and may in the future be, limited in our ability to respond to evolving business conditions.
As a result, we have been, and may in the future be, limited in our ability to respond to evolving business conditions. For additional discussion of statutory profit limits, see Management’s Discussion and Analysis of Financial Condition and Results of Operations – II. Financial Condition in the Annual Report.
Any future epidemic, pandemic, or other widespread health risk, including a new variation of the COVID-19 virus, could exacerbate the impacts of many of the other risk factors described above and adversely affect our business.
Our business and results of operations could be adversely affected by epidemics, pandemics, or other widespread health risks. An epidemic, pandemic, or other widespread health risk could exacerbate the impacts of many of the other risk factors described above and adversely affect our business.
Removed
Although we may review and assess third-party vendor cybersecurity controls, our efforts may not be successful in preventing or mitigating the effects of such events.
Added
We undertake substantial efforts and expend significant resources to protect our systems and sensitive or confidential data and information. Our information security efforts are designed to evolve with the changing security threat environment through ongoing assessment and measurement.
Removed
Our systems are being threatened on a regular basis and our efforts may be insufficient to prevent or defend against an attack.
Added
Consolidations and strategic relationships in the independent agent channel in our Personal Lines business have increased competition and could continue to do so.
Removed
Our development and use of new technology, such as generative artificial intelligence, may present additional risks, may not be successful, and could have a material adverse effect on our business .
Added
Moreover, inconsistencies in requirements among the various states, or between state and federal requirements, or changes in regulatory priorities or funding, may further complicate our compliance efforts, potentially damage our reputation in the marketplace or our brand, potentially resulting in additional costs for us or impacting our ability to participate in certain government funded programs, such as the National Flood Insurance Program.
Removed
Our business and results of operations could be adversely affected by epidemics, pandemics, or other widespread health risks. Beginning with its emergence in 2020, COVID-19 increased many of the risks described above and impacted our business, operations, and financial results in several ways.
Added
Furthermore, our competitors or other third parties may be able to replace legacy systems, incorporate Advanced AI into their products and operations, or optimize or redesign their processes more quickly, or more successfully, than us.
Removed
We have discussed the associated risks and impacts of COVID-19 in our SEC filings beginning with its onset in 2020. We believe that the existing risks and impacts of COVID-19 are not currently material to our business.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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We also employ contractual nondisclosure requirements and use limitations consistent with our published Privacy Policy, and typically reserve the right to review third-party compliance against the required standards, where we deem appropriate. Our response to cybersecurity threats is triggered through various means. Through annual user awareness training, we teach our employees to identify and appropriately respond to such threats.
We also employ contractual nondisclosure requirements and use limitations consistent with our published Privacy Policy, and typically reserve the right to review third-party compliance against the required standards, where we consider it appropriate. Our response to cybersecurity threats is triggered through various means. Through annual user awareness training, we teach our employees to identify and appropriately respond to such threats.
The Technology Committee, which includes directors with technology experience, also oversees management’s effort to mitigate these risks. Technology Committee meetings typically occur five times a year. Generally, at these meetings, our CSO briefs the committee on cybersecurity-related matters.
The Technology Committee, which includes directors with technology experience, also oversees management’s efforts to mitigate these risks. Technology Committee meetings typically occur five times a year. Generally, at these meetings, our CSO briefs the committee on cybersecurity-related matters.
See Item 1A, Risk Factors – III. Operating Risks above for more information. - 29 -
See Item 1A, Risk Factors – III. Operating Risks above for more information. - 28 -
The CSO reports directly to the Chief Financial Officer and provides regular cybersecurity updates to the CEO, other members of the executive team, and the Board of Directors’ Technology Committee.
The CSO reports directly to the Chief Financial Officer. The CSO, or a senior member of his team, provides regular cybersecurity updates to the CEO, other members of the executive team, and the Board of Directors’ Technology Committee.
The Technology Committee of the Board of Directors oversees our use of technology in business strategy as well as the major risks arising from our technology, digital and data strategies, legacy information systems, technology investments, data privacy, operational performance, cybersecurity programs, and technology-related business continuity and disaster recovery programs.
The Technology Committee of the Board of Directors oversees our use of technology in executing the company’s business strategy as well as the major risks arising from our technology, digital and data strategies (including with respect to artificial intelligence), legacy systems, technology investments, data privacy, operational performance, cybersecurity programs, and technology-related business continuity and disaster recovery programs.

Item 2. Properties

Properties — owned and leased real estate

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Our owned facilities, which contain approximately 3.9 million square feet of space, are generally not segregated by segment. We own significant locations in Mayfield Village, Ohio and surrounding suburbs (including our corporate headquarters); Colorado Springs, Colorado; St. Petersburg, Florida; and Tampa, Florida. We lease approximately 1.8 million square feet of space throughout the U.S.
Our owned facilities, which contain approximately 3.3 million square feet of space, are generally not segregated by segment. We own significant locations in Mayfield Village, Ohio and surrounding suburbs (including our corporate headquarters); Colorado Springs, Colorado; and St. Petersburg, Florida. We lease approximately 1.9 million square feet of space throughout the U.S.
ITEM 2. PROPERTIES All of our properties are owned or leased by subsidiaries of The Progressive Corporation and are used for office functions, as call centers, as data centers, for training, or for warehouse space. At December 31, 2024, we owned 52 buildings located throughout the U.S. About half of these buildings are claims offices.
ITEM 2. PROPERTIES All of our properties are owned or leased by subsidiaries of The Progressive Corporation and are used for office functions, as call centers, as data centers, for training, or for warehouse space. At December 31, 2025, we owned 38 buildings located throughout the U.S. About one third of these buildings are claims offices.

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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ITEM 4. MINE SAFETY DISCLOSURES Not applicable. INFORMATION ABOUT OUR EXECUTIVE OFFICERS Incorporated by reference from information with respect to executive officers of The Progressive Corporation and its subsidiaries set forth in Part III, Item 10 of this Form 10-K, “Directors, Executive Officers and Corporate Governance.” - 30 - PART II
ITEM 4. MINE SAFETY DISCLOSURES Not applicable. INFORMATION ABOUT OUR EXECUTIVE OFFICERS Incorporated by reference from information with respect to executive officers of The Progressive Corporation and its subsidiaries set forth in Part III, Item 10 of this Form 10-K, “Directors, Executive Officers and Corporate Governance.” - 29 - PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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See Note 9 – Employee Benefit Plans “Incentive Compensation Plans - Employees” and “Incentive Compensation Plans - Directors” in our Annual Report, for a summary of our restricted equity grants. In May 2024, the Board of Directors approved an authorization for the company to repurchase up to 25 million of its common shares.
See Note 9 – Employee Benefit Plans “Incentive Compensation Plans - Employees” and “Incentive Compensation Plans - Directors” in our Annual Report, for a summary of our restricted equity grants. In May 2025, the Board of Directors approved an authorization for the company to repurchase up to 25 million of its common shares.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information The Progressive Corporation’s Common Shares, $1.00 par value, are traded on the New York Stock Exchange (NYSE) under the symbol PGR. Holders We had 1,614 shareholders of record on January 31, 2025.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information The Progressive Corporation’s Common Shares, $1.00 par value, are traded on the New York Stock Exchange (NYSE) under the symbol PGR. Holders We had 1,557 shareholders of record on January 31, 2026.
During the fourth quarter 2024, all repurchases were accomplished in conjunction with our equity incentive awards at the then-current market prices; there were no open market purchases during the quarter.
During the fourth quarter 2025, all repurchases were accomplished in conjunction with our equity incentive awards or through the open market at the then-current market prices.
Purchase of Equity Securities ISSUER PURCHASES OF EQUITY SECURITIES 2024 Calendar Month Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs October 195 $ 253.66 423,931 24,576,069 November 51 244.21 423,982 24,576,018 December 79 266.98 424,061 24,575,939 Total 325 $ 255.41 Progressive’s financial policies state that we will repurchase shares to neutralize dilution from equity-based compensation in the year of issuance and as an option to effectively use under-leveraged capital.
Purchase of Equity Securities ISSUER PURCHASES OF EQUITY SECURITIES 2025 Calendar Month Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Maximum Number of Shares That May Yet Be Purchased Under the Plans or Programs October 111,240 $ 219.47 305,188 24,694,812 November 108,993 214.56 414,181 24,585,819 December 49,100 227.55 463,281 24,536,719 Total 269,333 $ 218.96 Progressive’s financial policies state that we will repurchase shares to neutralize dilution from equity-based compensation in the year of issuance or as an option to effectively use under-leveraged capital.

Other PGR 10-K year-over-year comparisons