PROGRESSIVE CORP/OH/ Quarterly Report for Q1 Ended Mar 31, 2009

Summary

Progressive Corporation (PGR) filed its quarterly report on Form 10-Q for the period ending March 30, 2009. The report indicates no material changes in risk factors from the previous annual report. The company's investment portfolio, while subject to interest rate and equity market risks, is managed with a focus on diversification. Value-at-Risk (VaR) calculations show potential losses, with the total portfolio VaR at $477.5 million at 99% confidence over a 66-day period, representing 3.7% of the portfolio and 11.1% of shareholders' equity. Significant shareholder activity included the approval of amendments to the Code of Regulations and the ratification of the independent auditor. The company also details its executive compensation through restricted stock awards, both time-based and performance-based, aligning executive incentives with business growth and profitability goals.

Key Highlights

• 1No material changes in disclosed risk factors compared to the 2008 annual report.
• 2Investment portfolio's 66-day VaR at 99% confidence was $477.5 million (3.7% of portfolio, 11.1% of shareholder's equity) as of March 31, 2009.
• 3Shareholders approved amendments to the Code of Regulations regarding shareholder proposals and director nominations.
• 4The company's stock repurchase program authorized in June 2007 for up to 100 million shares was nearing expiration (June 30, 2009), with minimal repurchases in the first quarter of 2009 (346,702 shares).
• 5Progressive granted significant restricted stock awards to management in March 2009, including performance-based awards tied to premium growth and combined ratio targets.
• 6The independent registered public accounting firm, PricewaterhouseCoopers LLP, was ratified for 2009.
• 7Executive compensation includes performance-based restricted stock awards designed to incentivize outperformance in personal and commercial auto businesses and achieve profitability goals.

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