Published
# The Progressive Corporation (NYSE: PGR) — Narrative
Sources: the FY2025 Annual Report on Form 10-K filed March 2, 2026 (accession 0000080661-26-000086), including the 2025 Annual Report to Shareholders filed as Exhibit 13 to that Form 10-K; the Form 10-Q for the quarter ended June 30, 2026, filed August 3, 2026 (accession 0000080661-26-000308); and Current Reports on Form 8-K as noted.
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## Business
*From the FY2025 Form 10-K, accession 0000080661-26-000086.*
Progressive is a United States property-casualty insurance group. Its subsidiaries write personal auto insurance, special lines products (motorcycles, RVs, watercraft and other recreational vehicles), residential property insurance for homeowners and renters, commercial auto liability and physical damage insurance, business owners' policies and general liability for small businesses, and workers' compensation insurance aimed at the transportation industry. Revenue is overwhelmingly underwriting premium: the group wrote $83.2 billion of net premiums in 2025 and earned $81.7 billion, against $1.2 billion of fees and other revenues and $0.5 billion of service revenues. Personal auto alone is just under 80% of companywide premiums. A $97.4 billion investment portfolio at December 31, 2025 supplies the second income stream, contributing $3.6 billion of investment income and $727 million of net realized gains in 2025. The Progressive Corporation itself is an Ohio holding company with no revenue-producing operations, physical property or employees of its own; the insurance organization has been selling insurance since 1937 and employed about 70,000 people at year-end 2025.
**Two reporting segments.**
*Personal Lines* — 87% of 2025 net premiums written (85% in 2024, 84% in 2023). Personal vehicle products are 96% of the segment; personal property is the remaining ~4%. Progressive ranked second in U.S. private passenger auto by 2024 premiums written in a market with roughly 230 competitors, where the 16 largest writers hold about 85% of volume; management believes it held that rank through 2025. It believes it is the market-share leader in both motorcycle and boat insurance and among the largest RV writers. In homeowners it was the twelfth largest U.S. carrier on 2024 premiums, in a market of about 360 competitors. The personal property book also includes manufactured homes, personal umbrella, and primary and excess flood, plus participation in the National Flood Insurance Program's "Write Your Own" program, 100% of which is reinsured to the NFIP.
*Commercial Lines* — 13% of 2025 net premiums written (15% in 2024, 16% in 2023). Core commercial auto operates in five business market targets: for-hire specialty, for-hire transportation, tow, contractor and business auto. Progressive has ranked first in U.S. commercial auto since 2015 and believes it held that position for 2025; about 64 groups writing more than $200 million each comprise 88% of the market alongside it. Roughly 90% of commercial auto was written through agents in 2025, excluding the transportation network company (TNC) business, which is entirely direct. The TNC book — coverage for Uber Technologies subsidiaries in 14 states at December 31, 2025 — was 14% of Commercial Lines net premiums written in 2025, and its premiums are estimated from projected miles driven and trued up monthly.
**Distribution.** Both segments sell through independent agents and direct. Personal vehicle volume was 57% direct and 43% agency in 2025, a channel mix that has shifted toward direct each year (55%/45% in 2024, 54%/46% in 2023). Personal property remains agency-weighted at 72%, sold through a network of more than 40,000 independent agencies plus brokerages in New York and California, and direct via HomeQuote Explorer, a multi-carrier comparison platform. The stated strategy — the "Destination Era" — is to bundle auto with property and with third-party products, on the premise that bundled households ("Robinsons") stay longer and cost less in claims. Supporting mechanics include the Platinum agent program (nearly 6,000 Platinum agents at year-end 2025), the "Portfolio" multi-product agent quoting system, and commission-based referral of unaffiliated carriers' pet, life and specialty-car products, which is reported as service revenue. Service businesses are under 1% of total revenues.
**Pricing and product models.** Progressive rolls new product models out state by state and typically has several versions in market at once. Personal auto model 9.0, which began rolling out in the third quarter of 2025, adds embedded renters insurance as an auto endorsement and expands use of external data and rating variables; at December 31, 2025 it covered 10 states representing about 25% of companywide personal auto net premiums written, with model 9.1 expected to elevate its first state in early 2027. Special lines model R17 (27 enhancements, launched late 2024) continues to roll out. In personal property, 39 states representing close to 90% of property net premiums written were on next-generation models (5.0 and higher) at year-end 2025. In commercial auto, the 8.3 core model launched in 11 states representing 43% of core commercial auto countrywide premiums; the newest BOP model was in 34 states representing 92% of BOP premiums, with the BOP product available to agents in 46 states. Usage-based programs — Snapshot in personal auto (all states except California), Smart Haul and Snapshot ProView in commercial auto — feed the segmentation.
**Reinsurance.** Progressive generally does not reinsure its personal vehicle business outside mandatory state pools (Michigan Catastrophic Claims Association, Florida Hurricane Catastrophe Fund, North Carolina Reinsurance Facility) and the NFIP. Voluntary reinsurance is concentrated in personal property and parts of Commercial Lines. The property occurrence excess-of-loss program in force from June 1, 2025 through May 31, 2026 carried a $200 million first-event retention outside Florida and $75 million inside it, with limits net of retention of $2.2 billion for a first Florida event and $2.0 billion outside Florida at December 31, 2025 (reduced by $70 million on January 8, 2026 when a catastrophe bond matured). No losses were ceded under the occurrence program or the $175 million hurricane-season shared limit during 2025. A new occurrence program covering the boat product began January 1, 2026: $150 million for named windstorms above a $225 million per-event retention. Commercial Lines uses quota-share for TNC and certain workers' compensation and BOP coverages, and excess-of-loss for higher-limit commercial auto liability.
**Regulation and capital.** At least one subsidiary is licensed in each of the 50 states, the District of Columbia, Bermuda, and Canada and its provinces; domestic insurance subsidiaries are domiciled in Florida, Illinois, Indiana, Louisiana, Michigan, New Jersey, New York, Ohio, Texas and Wisconsin. Statutory surplus was $28.4 billion at year-end 2025 against $83.2 billion of net premiums written — a combined premiums-to-surplus ratio of 2.9 to 1. Two states permit a 3.5-to-1 target for the personal vehicle companies, which represented 91% of companywide net premiums written in 2025. Risk-based capital ratios exceeded minimums at December 31, 2025. As of January 31, 2026 the group had access to $5.5 billion of securities held in a non-insurance subsidiary that could be contributed to insurance subsidiary capital.
Progressive owned 38 buildings (about 3.3 million square feet) at December 31, 2025, including its Mayfield Village, Ohio headquarters, and leased approximately 1.9 million square feet. In May 2025 the Board authorized repurchase of up to 25 million common shares, an authorization without an expiration date.
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## Risk factors
*From the FY2025 Form 10-K, accession 0000080661-26-000086. Management groups risks as insurance, operating, market, liquidity, and credit/other, plus an "other" category; the substantive ones follow.*
**Pricing accuracy.** The company's economics rest on setting rates that cover losses, loss adjustment expenses and underwriting expenses. Accurate pricing depends on data availability and analysis, timely recognition of frequency and severity trends, regulatory approval of rate changes, and prediction of retention. Named threats include unanticipated changes in auto repair costs, parts prices, used-car prices, construction and labor costs, **and the imposition and impacts of tariffs**; changes in vehicle usage and driving patterns; advances in vehicle and home technology including autonomous vehicles; unexpected medical-cost changes; and the difficulty of understanding the risk profile of large customers such as transportation network companies. Separately, regulatory, legislative and political efforts to restrict rating factors such as credit, education and occupation could, in management's view, "significantly undermine the effectiveness of risk-based pricing." Underpricing erodes margin and, sustained, erodes subsidiary capital and the ability to write new business; overpricing costs competitiveness.
**Loss reserve adequacy.** Reserves are estimates. Cited sources of error include the difficulty of predicting frequency and severity direction across many products and markets, inflation and tariffs, labor shortages raising loss expenses directly and indirectly, changing judicial interpretations of policy provisions, high jury verdicts and punitive damage awards, changes in claims settlement practices, fraudulent or inflated claims, and the limits of modelling tools that assume past development patterns persist. Ultimate paid losses "may deviate, perhaps substantially" from point-in-time estimates.
**Catastrophes and climate.** Results have been and likely will continue to be materially affected by hurricanes, tornadoes, windstorms, floods, earthquakes, hailstorms, severe winter weather and fires. Climate change may be increasing the frequency, duration and insured damage of these events and shifting where they occur, and may make catastrophe models less reliable. The property book has a concentration of policies in force in states with significant hurricane and hailstorm exposure and has historically been hit harder than some peers by events in those states.
**Reinsurance availability and collection.** The property business depends on reinsurance contracts, state facilities and catastrophe bonds. Retentions leave Progressive liable below the threshold; aggregate limits leave it exposed above. Progressive remains liable to policyholders as direct insurer regardless of reinsurer performance, and reinsurance pricing and capacity swing with industry losses and market conditions.
**Operating risks.** Dependence on uninterrupted systems and on third-party systems; cyberattack and data breach, with explicit acknowledgement that systems "are being threatened on a regular basis" and that defenses may prove insufficient; brand and reputation, given large sustained advertising investment and reliance on recognizable campaigns; the pace of innovation relative to competitors; managing complexity and legacy systems; claims-adjustment accuracy; and a highly regulated environment in which rate approvals, marketing restrictions, AI and third-party data rules, and limits on cancellation, non-renewal and market exit can all delay response to changing conditions. Markets are highly competitive and mature, with cyclical soft and hard phases that are often only identifiable in retrospect. Consolidation among independent agents has increased competition; concentration in auto makes Progressive more sensitive than diversified insurers to anything that reduces auto insurance demand.
**Market, liquidity and credit risks.** The fixed-income portfolio carries interest rate, credit, concentration, and prepayment/extension risk; the common equity portfolio is primarily indexed to the Russell 1000 and is exposed to index concentration as well as general market movement. A substantial decline in either portfolio could reduce reported earnings and capital and put subsidiaries at risk of failing regulatory minimums. Inability to access cash accounts or convert investments on favorable terms would impair claims payment. Counterparty default — reinsurers, bundling partners, state programs such as the Michigan Catastrophic Claims Association and the NFIP — could cause significant losses. As a holding company with no operations, The Progressive Corporation depends on subsidiary dividends, which are restricted by statutory capital requirements, distribution limits based on net income or surplus, rating considerations, and in some jurisdictions prior regulatory approval. Credit rating downgrades would raise borrowing costs and could trigger collateral posting under certain derivative contracts.
**Other.** Management explicitly does not manage to short-term earnings expectations, provides no earnings estimates and does not comment on analyst estimates, and warns that reported results may vary significantly from investor expectations; the personal property business "has caused, and is likely to continue to cause, additional volatility in our consolidated results." The dividend policy — a quarterly dividend plus a variable dividend considered at least annually — may produce widely varying amounts or none at all. Tax-advantaged project investments (renewable energy, historic rehabilitation, affordable housing) may not deliver the anticipated credits, which can be challenged or recaptured.
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## Management's discussion — fiscal 2025
*From the 2025 Annual Report to Shareholders filed as Exhibit 13 to the FY2025 Form 10-K, accession 0000080661-26-000086.*
**Result.** 2025 was a year of high margin and high growth. The companywide underwriting profit margin was 12.6%, well above the 4% calendar-year goal and 1.4 points better than 2024's 11.2%. Net premiums written were $83.2 billion, up $8.8 billion or 12%; net premiums earned rose 15% to $81.7 billion. Policies in force ended the year 3.7 million, or 10%, higher. Net income rose $2.8 billion to $11.3 billion, and comprehensive income rose $4.2 billion to $12.8 billion, the latter helped by net unrealized gains on fixed-maturity securities. Diluted earnings per share were computed on 588.1 million average equivalent shares.
**What drove the margin.** The companywide loss and LAE ratio fell 3.2 points to 65.9%, on lower personal and commercial auto accident frequency, lower weather-related catastrophe losses, and favorable prior accident years development ($317 million of favorable actuarial adjustment on prior accident years in 2025, against unfavorable adjustments in each of the two prior years). Catastrophe losses fell to $1,478 million (1.8 points of the combined ratio) from $2,514 million (3.6 points) in 2024; the property book's catastrophe load dropped from 24.8 points to 10.4 points. Working the other way, the underwriting expense ratio rose 1.8 points to 21.5%, of which 1.5 points was a single item discussed below, and advertising spend rose $1.1 billion to $5.1 billion. The reported combined ratio was 87.4, against 88.8 in 2024 and 94.9 in 2023.
**The Florida policyholder credit.** Florida imposes a statutory limit on the profit any insurance group may earn on personal auto over any three-accident-year period. Following the state's early-2023 insurance reform, Progressive's Florida personal auto loss costs fell and reserve development ran favorable, and despite rate reductions beginning in the fourth quarter of 2024, its 2023–2025 Florida profit exceeded the limit. Progressive recorded a **$1.2 billion policyholder credit expense** in 2025 ($1,224 million as a separate income statement line; $560 million allocated to agency personal vehicles and $664 million to direct). It cost 1.5 points of the companywide underwriting expense ratio and 1.7 points of Personal Lines' margin — excluding it, the Personal Lines underwriting margin would have been 14.2% rather than 12.5%. Credits began going out to Florida personal auto policyholders active at December 31, 2025 in early 2026.
**Segments.** Personal Lines earned $8,854 million of underwriting profit at a 12.5% margin (11.4% in 2024), with net premiums written up 14% and policies in force up 11%, on top of 2024's 23% and 18%. Within it, agency vehicles ran an 85.4 combined ratio, direct vehicles 90.1, and property 75.1 — the property result a step change from 98.3 in 2024, driven by low catastrophe losses, lower frequency, favorable prior-year development and rate. Personal property net premiums written grew only 1% and homeowners new business applications fell about 45% year over year, the deliberate consequence of restricting growth in volatile weather markets, prioritizing lower-risk properties, writing new homeowners business only bundled with a Progressive auto policy where permitted, exiting the non-owner-occupied market, and holding mandatory wind and hail deductibles and roof depreciation schedules. Late in 2025 the company began reversing some of those restrictions selectively by state.
Commercial Lines earned $1,416 million at a 13.0% margin (10.6% in 2024) but **net premiums written fell 3%** even as policies in force grew 4%. The decline was primarily certain TNC policies not renewing in 2025; excluding TNC, net premiums written would have been down 1%. A mix shift toward 6-month-term policies in the contractor and business auto targets, and toward lower-average-premium targets generally, accounted for the rest. Core commercial auto new and renewal applications rose 1% and 6%; excluding the for-hire transportation target — where rate and non-rate actions and a shrinking active motor carrier count weighed — new application growth would have been 5%.
**Rate and price per policy.** In 2025 Progressive cut personal auto rates by less than 1% in aggregate, raised personal property rates about 10%, and raised core commercial auto rates about 9%. Average written premium per policy nonetheless fell 1%, 7% and 6% respectively, as mix shifted toward renters policies, away from high-premium volatile-weather property markets, and toward lower-premium commercial targets and 6-month terms. Management flagged tariffs announced from the first quarter of 2025 as the principal open question on 2026 loss costs, noting that "effective tariffs and other retaliatory actions may result in higher loss costs, which could result in a reduction in profitability and the possible need for rate increases throughout 2026."
**Severity and frequency.** Total personal auto incurred severity rose 6% in 2025 (bodily injury +10%, collision +3%, property damage +4%, PIP −2%), driven by more large losses, higher medical costs, and higher bodily injury reserves reflecting a greater share of plaintiff-attorney represented claims. Total personal auto frequency fell 3%, partly a mix shift toward preferred Wrights and Robinsons tiers. Core commercial auto severity rose 4% and frequency fell 10%.
**Retention.** Trailing 12-month personal auto policy life expectancy fell 7% (agency −6%, direct −8%) and the trailing 3-month measure fell 10%, which management attributes primarily to increased shopping and competition plus mix and billing-plan changes — noting that customer-preservation efforts which re-write an existing customer onto a new policy retain the customer while depressing the measure. Personal property policy life expectancy fell 12% on the renters mix shift. Core commercial auto policy life expectancy rose 10%.
**Investments and capital.** The portfolio grew to $97.4 billion from $80.3 billion, on operating cash flow and investment returns net of dividends paid. Recurring pretax book yield was 4.1% (3.9% in 2024) and the fully taxable equivalent total return was 7.3% (fixed income 7.0%, common stock 16.8%). Duration was 3.4 years and weighted average credit quality AA-. At year-end $53.3 billion — nearly 55% of the portfolio — sat in short-term investments and U.S. Treasuries. Total capital was $37.2 billion, up $4.7 billion, with a debt-to-total-capital ratio of 18.5% against a policy ceiling of 30%. The Progressive Corporation received $10.0 billion of subsidiary dividends in 2025, declared $13.90 per common share ($8.1 billion) in dividends, repurchased 0.7 million shares for $166 million, and contributed a net $94 million back to subsidiaries. Loss and LAE reserves stood at $43.3 billion; roughly half of outstanding reserves are typically paid within twelve months. Debt outstanding was $7.0 billion of senior notes maturing 2027 through 2052, with $1.0 billion due in 2027. Purchase obligations were $3.0 billion and minimum reinsurance commitments $317 million. H.R. 1, signed July 4, 2025, did not have a material adverse effect on results.
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## Current quarter — three and six months ended June 30, 2026
*From the Form 10-Q for the quarter ended June 30, 2026, accession 0000080661-26-000308.*
**The shape of the quarter.** Growth continued, margin compressed but stayed far above target, and investment results carried earnings. Net premiums written were $21.1 billion, up $1.0 billion or 5%; net premiums earned were $21.6 billion, up 6%. Net income was $3,311 million (diluted EPS $5.67) against $3,175 million ($5.40) a year earlier — a $136 million increase management attributes primarily to higher total net investment income. That measure is a composite, defined in the quarterly report as recurring investment income plus total net realized gains (losses) on securities, less investment expenses; within it, realized gains — and within those, holding-period marks on equity and hybrid securities still owned rather than gains on sales — contributed more of the year-over-year increase than recurring investment income did, as the figures under Investments and capital below show. Comprehensive income, by contrast, **fell $669 million to $2,935 million**, because fixed-maturity securities produced net unrealized losses this year against net unrealized gains last year. For the six months, net income was $6,129 million (diluted EPS $10.47) and comprehensive income $5,179 million.
Progressive crossed 40 million policies in force during the quarter, adding 0.5 million in the three months and ending at 40.1 million — 2.8 million, or 7%, more than at June 30, 2025.
**Underwriting.** The companywide underwriting profit margin was 12.7% (combined ratio 87.3), down 1.1 points from 13.8% a year earlier: the loss and LAE ratio rose 0.6 points on higher severity, and the underwriting expense ratio rose 0.5 points on advertising. Advertising spend was $1.4 billion in the quarter, up 16%, and $2.9 billion for the half, up 18%. Underwriting profit was $2,730 million for the quarter and $5,582 million for the half.
Personal Lines — 88% of companywide net premiums written — earned a 12.4% margin, down from 14.0%, with personal vehicle at 12.0% and personal property at 22.0%. Personal Lines net premiums written rose 5% (agency vehicles +2%, direct vehicles +8%, property +1%) and policies in force rose 8%, against 15% and 16% growth in the year-ago quarter. Personal auto policies in force were up 9%. Commercial Lines improved, to a 14.7% margin from 13.2%, with net premiums written up 4% and policies in force up 3%, helped by targeted rate decreases by state and market target and by higher advertising and agent incentive spend.
Catastrophe losses were $773 million in the quarter (3.6 points), versus $707 million (3.5 points); for the half, $1,041 million (2.4 points) versus $1,166 million (2.9 points). The property book's catastrophe load improved to 13.5 points from 20.2. Total incurred losses and LAE were $14,572 million for the quarter. On an accident year basis the loss and LAE ratio was 1.6 points higher than a year earlier, with the reported ratio cushioned by greater favorable prior accident years development — in personal lines from lower-than-anticipated bodily injury severity and lower payments on reopened property damage claims, and in commercial auto from lower-than-anticipated TNC injury severity, partly offset by higher injury severity and litigation defense costs in core commercial auto. Personal auto severity increase was "predominantly driven by bodily injury coverage, due to higher medical costs, more large losses, and a higher rate of plaintiff-attorney represented claims," and has been relatively stable through the first half. Core commercial auto trailing 12-month severity rose 5% and frequency fell 8%.
**Price and retention.** Countrywide, Progressive cut personal auto rates by less than 1% in the quarter and raised personal property rates about 1% (3% year to date); core commercial auto rates were relatively flat (1% year to date). Average written premium per policy fell 2% in personal auto and personal property and 3% in core commercial auto. Retention weakened further: trailing 12-month personal auto policy life expectancy was down 8% year over year and the trailing 3-month measure down 9%, personal property down 8%, while core commercial auto rose 2%. Management's stated cause is increased shopping and competition, with billing-plan changes and mix as secondary factors. Direct auto quote volume fell 7% with conversion up 9%; agency auto quotes fell 1% with conversion up 2%. Management states it believes it is "currently adequately priced in our personal auto, personal property, and core commercial auto products in most states through the remainder of the year," while continuing to monitor tariffs, inflation, car prices, miles driven, severity, frequency, weather and construction costs state by state.
In personal property, the selective reopening begun in late 2025 continues — expanding agency relationships, reopening new business in certain agency and direct markets, and lifting underwriting restrictions on older roofs, medium- to high-value homes and non-bundled homeowners in certain markets — while restrictions remain in markets where profitability and weather exposure still need work. Homeowners policies in force fell 2% in growth-oriented markets and **17% in volatile weather markets**. Homeowners new business applications rose 11% year over year; renters fell 2%.
**Investments and capital.** Portfolio fair value was $97.2 billion, essentially flat against $97.4 billion at year-end 2025: valuation declines across fixed-maturity sectors, the **$7.9 billion payment of the annual variable common share dividend** and $1.1 billion of buybacks were offset by insurance cash flows and note proceeds. Recurring pretax book yield was 4.2%, unchanged year over year, but the FTE total return fell to 1.2% from 2.1% (fixed income 0.6% versus 1.7%; common stock 15.3% versus 10.9%) on the move in Treasury yields. Duration lengthened slightly to 3.5 years; credit quality remained AA-. The fixed-maturity portfolio held an after-tax net unrealized **loss** of $832 million at June 30, 2026, against a $117 million net unrealized gain at December 31, 2025.
The pieces of total net investment income contributed very unevenly. Recurring investment income was $979 million in the quarter against $871 million a year earlier, up $108 million on growth in invested assets. Total net realized gains on securities were $604 million against $387 million, up $217 million — and almost all of that is marks rather than sales: net holding period gains on securities still owned were $588 million against $368 million; the 2026 figure is equity securities of $571 million plus hybrid securities of $17 million. Those are marks carried through income, unlike the available-for-sale fixed-maturity marks behind the unrealized loss above, which sit in other comprehensive income. Net realized gains on security sales were $16 million against $19 million. Net of investment expenses of $10 million ($9 million a year earlier), the segment tables put the composite — investment profit — at $1,573 million for the quarter against $1,249 million. For the six months, recurring investment income was $1,896 million against $1,685 million and total net realized gains $484 million against $175 million, of which $372 million and $155 million were holding period gains.
Operating cash flow was $8.0 billion for the half, down from $9.2 billion, primarily because of the $1.2 billion of Florida policyholder credits paid in the first quarter of 2026. Total capital reached $42.7 billion, up $5.5 billion from year-end, on $5.2 billion of comprehensive income and **$1.5 billion of senior notes issued in March 2026** — $500 million of 4.60% notes due 2031 and $1 billion of 5.15% notes due 2036, netting approximately $1,487 million — less $1.1 billion spent repurchasing 5.4 million shares. Debt-to-total capital was 19.6%, up from 18.5% at year-end. Short-term debt at June 30, 2026 was the $500 million 2.45% notes maturing January 2027 and the $500 million 2.50% notes maturing March 2027. The company held $45.8 billion in short-term investments and Treasuries, about half the portfolio; $6.7 billion sat in the non-insurance holding company subsidiary; estimated consolidated statutory surplus was $32.9 billion. In April 2026 Progressive renewed its $300 million unsecured discretionary line of credit with PNC Bank and amended the rate to one-month term SOFR plus 1.0%; it drew nothing on it.
A quarterly dividend of $0.10 per common share ($58 million) was declared in each of the first and second quarters of 2026, paid in April and July. The $8.0 billion ($13.60 per share) of dividends declared in the fourth quarter of 2025 were paid in January 2026.
**Reinsurance renewed.** During the second quarter Progressive entered new per-occurrence excess-of-loss contracts for the personal property business, raising the non-Florida single-event retention to $300 million from $200 million while keeping the Florida retention at $75 million; the program provides about $1.9 billion of coverage, reaching an estimated $2.2 billion for Florida including the Florida Hurricane Catastrophe Fund. A new 2026 catastrophe aggregate excess-of-loss contract carries a higher limit than the 2025 program and covers named storms plus wildfires, winter storms and severe thunderstorms. Reinsurance was "readily available and competitively priced," with no material year-over-year change in aggregate cost.
There were no material changes to risk factors from the FY2025 Form 10-K. Litigation accruals for non-claims lawsuits were not material at June 30, 2026, and there were no material settlements during 2025 or the first half of 2026. The claims-related docket is heavier. As of June 30, 2026, lawsuits had been certified or conditionally certified as class or collective actions alleging that Progressive improperly values total loss claims by applying a negotiation adjustment in Colorado, North Carolina and Ohio; improperly calculates basic economic loss as it relates to wage loss coverage in New York; and improperly reduces or denies personal injury protection benefits where medical expenses are paid initially by health insurance in Arkansas. The total loss vehicle valuation challenge extends beyond those three certified states to putative class actions pending in additional states, and management warns that an unfavorable result in, or a settlement of, a significant number of those suits "could, in aggregation, have a material adverse effect on our financial condition, cash flows, and/or results of operations."
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## Subsequent events
*From Current Reports on Form 8-K filed January 28, June 17, August 10, August 19 and September 18, 2026 (accessions 0000080661-26-000071, 0000080661-26-000210, 0000080661-26-000310, 0000080661-26-000315 and 0000080661-26-000322), as cited below.*
Neither the Form 10-Q for the quarter ended June 30, 2026 (accession 0000080661-26-000308) nor the FY2025 Form 10-K and its Exhibit 13 (accession 0000080661-26-000086) contains a subsequent-events note. No post-period acquisition, divestiture, borrowing or litigation settlement is disclosed in either filing.
Two developments after June 30, 2026 bear on the business as described above. First, the senior management changes announced during the first half of 2026 took effect on **July 4, 2026**: John P. Sauerland retired as Chief Financial Officer on July 3 and was succeeded by Andrew J. Quigg (accession 0000080661-26-000071), and the Personal Lines and customer relationship management organizations were placed under a single newly created Chief Personal Lines Officer role filled by Lori Niederst, with Heather Day becoming CRM President and Personal Lines President Patrick K. Callahan due to retire from that role in January 2027 (accession 0000080661-26-000210). Second, on August 10, 2026 Progressive furnished a report on its catastrophe reinsurance program as Exhibit 99 to a Form 8-K (accession 0000080661-26-000310), completing the public description of the property catastrophe per-occurrence program the quarterly report had already set out. The report states that placement of the program covering June 1, 2026 through May 31, 2027 is complete, with first-event limits, net of retention, of **$2.19 billion in Florida and $1.85 billion outside Florida**, above the $75 million Florida and $300 million non-Florida retentions described in the quarterly report.
Reported results since quarter end show the same pattern as the second quarter — steady premium growth against a rising combined ratio. Net premiums written grew 5% in July 2026 and 6% in August 2026 year over year, and policies in force reached 40.5 million at August 31, 2026, up 7%. The monthly combined ratio was 86.8 in July against 85.3 a year earlier, and 89.3 in August against 83.1, with monthly net income down 12% and 22% respectively (July results, accession 0000080661-26-000315; August results, accession 0000080661-26-000322).