Progressive(PGR) Businesswire·2024-03-06 15:34Credit Ratings and Affirmations - AM Best affirmed the Financial Strength Rating (FSR) of A+ (Superior) and Long-Term Issuer Credit Ratings (Long-Term ICR) of "aa" (Superior) for Progressive Corporation members [1] - AM Best affirmed the Long-Term ICR of "a" (Excellent) for Progressive Corporation and all Long-Term Issue Credit Ratings (Long-Term IR) of its senior unsecured issuances [1] - AM Best affirmed the FSR of A (Excellent) and Long-Term ICRs of "a+" (Excellent) for Protective Insurance Company and its subsidiaries [1] - AM Best affirmed the FSR of A (Excellent) and Long-Term ICR of "a+" (Excellent) for National Continental Insurance Company [1] - The outlook for all affirmed ratings is stable [1] Progressive Corporation's Performance and Strengths - Progressive's ratings reflect its strongest balance sheet strength, strong operating performance, very favorable business profile, and appropriate enterprise risk management (ERM) [1] - Progressive's risk-adjusted capitalization is considered strongest, benefiting from favorable underwriting results and reliable investment income [2] - Progressive reported 2.1 billion loss in 2022, driven by stronger underwriting and investment incomes [3] - Progressive's property segment reported a sub-100 combined ratio in 2023, reflecting management's efforts to rebalance exposure accumulations [2] - Progressive maintains high underwriting leverage relative to industry averages but consistently produces favorable underwriting results with low volatility [3] Protective Insurance Corporation Group and National Continental Insurance Company - Protective's ratings reflect its very strong balance sheet strength, adequate operating performance, neutral business profile, and appropriate ERM [4] - National Continental's ratings reflect its very strong balance sheet strength, strong operating performance, limited business profile, and appropriate ERM [4] - Both groups benefit from strategic advantages and financial strength as affiliates or subsidiaries of Progressive [4] Detailed List of Affirmed Ratings - FSR of A+ (Superior) and Long-Term ICRs of "aa" (Superior) affirmed for Progressive Corporation members, including Progressive Casualty Insurance Company, Progressive Northern Insurance Company, and others [4][5] - FSR of A (Excellent) and Long-Term ICRs of "a+" (Excellent) affirmed for Protective Insurance Company and its subsidiaries, including Sagamore Insurance Company and Protective Specialty Insurance Company [5] - FSR of A (Excellent) and Long-Term ICR of "a+" (Excellent) affirmed for National Continental Insurance Company [5] - Long-Term ICRs of "a" (Excellent) and Long-Term IRs affirmed for Progressive Corporation's senior unsecured notes, including 850 million 4.125% notes due 2047 [6][7] Industry Context - Progressive continues to outperform AM Best's private passenger standard auto composite despite inflation and supply chain issues in the automobile insurance industry [2] - Progressive leverages advanced underwriting and claims-handling technology, including usage-based technologies [2] - The company faced challenges from higher severity of private passenger auto physical damage claims and unfavorable loss reserve development in 2023 [3]