PGR 10-Q Quarterly Report June 30, 2025

PROGRESSIVE CORP/OH/

10-Ks and 10-Qs

10-Q	Quarter ended Sept. 30, 2025
10-Q	Quarter ended June 30, 2025
10-Q	Quarter ended March 31, 2025
10-K	Fiscal year ended Dec. 31, 2024
10-Q	Quarter ended Sept. 30, 2024
10-Q	Quarter ended June 30, 2024
10-Q	Quarter ended March 31, 2024
10-K	Fiscal year ended Dec. 31, 2023
10-Q	Quarter ended Sept. 30, 2023
10-Q	Quarter ended June 30, 2023
10-Q	Quarter ended March 31, 2023
10-K	Fiscal year ended Dec. 31, 2022
10-Q	Quarter ended Sept. 30, 2022
10-Q	Quarter ended June 30, 2022
10-Q	Quarter ended March 31, 2022
10-K	Fiscal year ended Dec. 31, 2021
10-Q	Quarter ended Sept. 30, 2021
10-Q	Quarter ended June 30, 2021
10-Q	Quarter ended March 31, 2021
10-K	Fiscal year ended Dec. 31, 2020
10-Q	Quarter ended Sept. 30, 2020
10-Q	Quarter ended June 30, 2020
10-Q	Quarter ended March 31, 2020
10-K	Fiscal year ended Dec. 31, 2019
10-Q	Quarter ended Sept. 30, 2019
10-Q	Quarter ended June 30, 2019
10-Q	Quarter ended March 31, 2019
10-K	Fiscal year ended Dec. 31, 2018
10-Q	Quarter ended Sept. 30, 2018
10-Q	Quarter ended June 30, 2018
10-Q	Quarter ended March 31, 2018
10-K	Fiscal year ended Dec. 31, 2017
10-Q	Quarter ended Sept. 30, 2017
10-Q	Quarter ended June 30, 2017
10-Q	Quarter ended March 31, 2017
10-K	Fiscal year ended Dec. 31, 2016
10-Q	Quarter ended Sept. 30, 2016
10-Q	Quarter ended June 30, 2016
10-Q	Quarter ended March 31, 2016
10-K	Fiscal year ended Dec. 31, 2015
10-Q	Quarter ended Sept. 30, 2015
10-Q	Quarter ended June 30, 2015
10-Q	Quarter ended March 31, 2015
10-K	Fiscal year ended Dec. 31, 2014
10-Q	Quarter ended Sept. 30, 2014
10-Q	Quarter ended June 30, 2014
10-Q	Quarter ended March 31, 2014
10-K	Fiscal year ended Dec. 31, 2013
10-Q	Quarter ended Sept. 30, 2013
10-Q	Quarter ended June 30, 2013
10-Q	Quarter ended March 31, 2013
10-K	Fiscal year ended Dec. 31, 2012
10-Q	Quarter ended Sept. 30, 2012
10-Q	Quarter ended June 30, 2012
10-Q	Quarter ended March 31, 2012
10-K	Fiscal year ended Dec. 31, 2011
10-Q	Quarter ended Sept. 30, 2011
10-Q	Quarter ended June 30, 2011
10-Q	Quarter ended March 31, 2011
10-K	Fiscal year ended Dec. 31, 2010
10-Q	Quarter ended Sept. 30, 2010
10-Q	Quarter ended June 30, 2010
10-Q	Quarter ended March 31, 2010
10-K	Fiscal year ended Dec. 31, 2009

PROXIES

DEF 14A	Filed on May 9, 2025
DEF 14A	Filed on March 24, 2025
DEF 14A	Filed on May 10, 2024
DEF 14A	Filed on March 25, 2024
DEF 14A	Filed on March 27, 2023
DEF 14A	Filed on May 13, 2022
DEF 14A	Filed on March 28, 2022
DEF 14A	Filed on March 29, 2021
DEF 14A	Filed on March 30, 2020
DEF 14A	Filed on March 29, 2019
DEF 14A	Filed on March 30, 2018
DEF 14A	Filed on March 31, 2017
DEF 14A	Filed on March 25, 2016
DEF 14A	Filed on March 27, 2015
DEF 14A	Filed on March 21, 2014
DEF 14A	Filed on March 22, 2013
DEF 14A	Filed on March 9, 2012
DEF 14A	Filed on March 18, 2011
DEF 14A	Filed on March 12, 2010

pgr-20250630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2025


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Commission File Number: 001-09518

THE PROGRESSIVE CORPORATION

(Exact name of registrant as specified in its charter)

Ohio

34-0963169

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

300 North Commons Blvd.,

Mayfield Village,

Ohio

44143

(Address of principal executive offices)

(Zip Code)

( 440 ) 461-5000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares, $1.00 Par Value	PGR	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Common Shares, $1.00 par value: 586,208,487 outstanding at June 30, 2025

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

The Progressive Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(unaudited)


	Three Months				Six Months
Periods Ended June 30,	2025		2024		2025		2024
(millions — except per share amounts)
Revenues
Net premiums earned	$	20,310	$	17,209	$	39,719	$	33,358
Investment income	871		685		1,685		1,303
Net realized gains (losses) on securities:
Net realized gains (losses) on security sales	19		( 227 )		20		( 373 )
Net holding period gains (losses) on securities	368		100		155		402
Total net realized gains (losses) on securities	387		( 127 )		175		29
Fees and other revenues	303		260		590		496
Service revenues	133		107		244		191
Total revenues	22,004		18,134		42,413		35,377
Expenses
Losses and loss adjustment expenses	13,605		12,595		26,409		23,567
Policy acquisition costs	1,511		1,308		2,967		2,540
Other underwriting expenses	2,689		2,180		5,408		4,111
Investment expenses	9		7		16		13
Service expenses	139		115		256		207
Interest expense	69		69		139		139
Total expenses	18,022		16,274		35,195		30,577
Net Income
Income before income taxes	3,982		1,860		7,218		4,800
Provision for income taxes	807		401		1,476		1,010
Net income	3,175		1,459		5,742		3,790
Other Comprehensive Income (Loss)
Changes in:
Total net unrealized gains (losses) on fixed-maturity securities	428		108		1,327		( 100 )
Net unrealized losses on forecasted transactions	1		0		1		0
Other comprehensive income (loss)	429		108		1,328		( 100 )
Comprehensive income (loss)	$	3,604	$	1,567	$	7,070	$	3,690
Computation of Earnings Per Common Share
Net income	$	3,175	$	1,459	$	5,742	$	3,790
Less: Preferred share dividends and other 1	0		0		0		17
Net income available to common shareholders	$	3,175	$	1,459	$	5,742	$	3,773
Average common shares outstanding - Basic	586.2		585.4		586.1		585.4
Net effect of dilutive stock-based compensation	1.6		2.0		1.6		2.0
Total average equivalent common shares - Diluted	587.8		587.4		587.7		587.4
Basic: Earnings per common share	$	5.42	$	2.49	$	9.80	$	6.45
Diluted: Earnings per common share	$	5.40	$	2.48	$	9.77	$	6.42

1 All of our outstanding Serial Preferred Shares, Series B, were redeemed in February 2024.

See notes to consolidated financial statements.

The Progressive Corporation and Subsidiaries

Consolidated Balance Sheets

(unaudited)


	June 30,				December 31,
(millions)	2025		2024		2024
Assets
Available-for-sale securities, at fair value:
Fixed maturities (amortized cost: $ 82,372 , $ 69,668 , and $ 77,126 )	$	82,272	$	67,489	$	75,332
Short-term investments (amortized cost: $ 2,103 , $ 733 , and $ 615 )	2,103		733		615
Total available-for-sale securities	84,375		68,222		75,947
Equity securities, at fair value:
Nonredeemable preferred stocks (cost: $ 517 , $ 887 , and $ 756 )	500		838		728
Common equities (cost: $ 775 , $ 708 , and $ 745 )	3,735		3,296		3,575
Total equity securities	4,235		4,134		4,303
Total investments	88,610		72,356		80,250
Cash and cash equivalents	125		90		143
Restricted cash and cash equivalents	10		12		11
Total cash, cash equivalents, restricted cash, and restricted cash equivalents	135		102		154
Accrued investment income	636		564		594
Premiums receivable, net of allowance for credit losses of $ 501 , $ 328 , and $ 460	16,406		14,545		14,369
Reinsurance recoverables	4,197		4,881		4,765
Prepaid reinsurance premiums	263		291		349
Deferred acquisition costs	2,110		1,938		1,961
Property and equipment, net of accumulated depreciation of $ 1,369 , $ 1,558 , and $ 1,461	820		713		790
Net federal deferred income taxes	633		1,001		954
Other assets	1,670		1,502		1,559
Total assets	$	115,480	$	97,893	$	105,745
Liabilities and Shareholders’ Equity
Unearned premiums	$	26,335	$	23,681	$	23,858
Loss and loss adjustment expense reserves	41,154		36,605		39,057
Accounts payable, accrued expenses, and other liabilities	8,492		7,376		10,346
Debt 1	6,895		6,891		6,893
Total liabilities	82,876		74,553		80,154
Common shares, $ 1.00 par value (authorized 900 ; issued 798 , including treasury shares of 212 )	586		586		586
Paid-in capital	2,192		2,060		2,145
Retained earnings	29,921		22,410		24,283
Accumulated other comprehensive income (loss):
Net unrealized gains (losses) on fixed-maturity securities	( 81 )		( 1,701 )		( 1,408 )
Net unrealized losses on forecasted transactions	( 13 )		( 14 )		( 14 )
Foreign currency translation adjustment	( 1 )		( 1 )		( 1 )
Total accumulated other comprehensive income (loss)	( 95 )		( 1,716 )		( 1,423 )
Total shareholders’ equity	32,604		23,340		25,591
Total liabilities and shareholders’ equity	$	115,480	$	97,893	$	105,745

1 Consists solely of long-term debt. See Note 4 – Debt for further discussion.

See notes to consolidated financial statements.

The Progressive Corporation and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

(unaudited)


	Three Months				Six Months
Periods Ended June 30,	2025		2024		2025		2024
(millions — except per share amounts)
Serial Preferred Shares, No Par Value
Balance, beginning of period	$	0	$	0	$	0	$	494
Redemption of Serial Preferred Shares, Series B 1	0		0		0		( 494 )
Balance, end of period	0		0		0		0
Common Shares, $ 1.00 Par Value
Balance, beginning of period	586		586		586		585
Treasury shares purchased	0		0		0		0
Net restricted equity awards issued/vested	0		0		0		1
Balance, end of period	586		586		586		586
Paid-In Capital
Balance, beginning of period	2,160		2,029		2,145		2,013
Amortization of equity-based compensation	32		31		48		48
Treasury shares purchased	0		0		( 1 )		( 1 )
Net restricted equity awards issued/vested	0		0		0		( 1 )
Reinvested dividends on restricted stock units	0		0		0		1
Balance, end of period	2,192		2,060		2,192		2,060
Retained Earnings
Balance, beginning of period	26,732		21,020		24,283		18,801
Net income	3,175		1,459		5,742		3,790
Treasury shares purchased	( 13 )		( 11 )		( 66 )		( 47 )
Cash dividends declared on common shares ($ 0.10 , $ 0.10 , $ 0.20 , and $ 0.20 per share) 1	( 58 )		( 58 )		( 117 )		( 117 )
Cash dividends declared on Serial Preferred Shares, Series B ($ 0 , $ 0 , $ 0 , and $ 15.688377 per share) 1	0		0		0		( 8 )
Reinvested dividends on restricted stock units	0		0		0		( 1 )
Other, net	85		0		79		( 8 )
Balance, end of period	29,921		22,410		29,921		22,410
Accumulated Other Comprehensive Income (Loss)
Balance, beginning of period	( 524 )		( 1,824 )		( 1,423 )		( 1,616 )
Other comprehensive income (loss)	429		108		1,328		( 100 )
Balance, end of period	( 95 )		( 1,716 )		( 95 )		( 1,716 )
Total shareholders’ equity	$	32,604	$	23,340	$	32,604	$	23,340

1 See Note 9 – Dividends for further discussion.

There are 20 million Serial Preferred Shares authorized. There are 5 million Voting Preference Shares authorized; no such shares have been issued.

See notes to consolidated financial statements.

The Progressive Corporation and Subsidiaries

Consolidated Statements of Cash Flows

(unaudited)


Six Months Ended June 30,	2025		2024
(millions)
Cash Flows From Operating Activities
Net income	$	5,742	$	3,790
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	149		138
Net amortization (accretion) of fixed-income securities	( 55 )		( 20 )
Amortization of equity-based compensation	48		48
Net realized (gains) losses on securities	( 175 )		( 29 )
Net (gains) losses on disposition of property and equipment	1		( 1 )
Changes in:
Premiums receivable	( 2,037 )		( 2,587 )
Reinsurance recoverables	568		213
Prepaid reinsurance premiums	86		( 41 )
Deferred acquisition costs	( 149 )		( 251 )
Income taxes	( 173 )		( 342 )
Unearned premiums	2,477		3,547
Loss and loss adjustment expense reserves	2,097		2,216
Accounts payable, accrued expenses, and other liabilities	550		1,058
Other, net	54		( 237 )
Net cash provided by operating activities	9,183		7,502
Cash Flows From Investing Activities
Purchases:
Fixed maturities	( 26,354 )		( 24,532 )
Equity securities	( 87 )		( 32 )
Sales:
Fixed maturities	17,086		13,687
Equity securities	151		98
Maturities, paydowns, calls, and other:
Fixed maturities	4,006		3,235
Equity securities	177		23
Net (purchases) sales of short-term investments	( 1,429 )		1,087
Net change in unsettled security transactions	178		120
Purchases of property and equipment	( 161 )		( 118 )
Sales of property and equipment	52		45
Net cash used in investing activities	( 6,381 )		( 6,387 )
Cash Flows From Financing Activities
Dividends paid to common shareholders	( 2,754 )		( 557 )
Acquisition of treasury shares for equity award tax liabilities	( 55 )		( 38 )
Acquisition of treasury shares acquired in open market	( 12 )		( 10 )
Redemption of preferred shares	0		( 500 )
Dividends paid to preferred shareholders	0		( 8 )
Net cash used in financing activities	( 2,821 )		( 1,113 )
Increase (decrease) in cash, cash equivalents, restricted cash, and restricted cash equivalents	( 19 )		2
Cash, cash equivalents, restricted cash, and restricted cash equivalents – January 1	154		100
Cash, cash equivalents, restricted cash, and restricted cash equivalents – June 30	$	135	$	102

See notes to consolidated financial statements.

The Progressive Corporation and Subsidiaries

Notes to Consolidated Financial Statements

(unaudited)

1. BASIS OF REPORTING AND ACCOUNTING

The accompanying consolidated financial statements include the accounts of The Progressive Corporation and our wholly owned insurance subsidiaries and non-insurance subsidiaries and affiliates in which we have a controlling financial interest (Progressive).

The consolidated financial statements reflect all normal recurring adjustments that, in the opinion of management, were necessary for a fair statement of the results for the interim periods presented. The results of operations for the period ended June 30, 2025, are not necessarily indicative of the results expected for the full year. These consolidated financial statements and the notes thereto should be read in conjunction with Progressive’s audited financial statements and accompanying notes included in Exhibit 13 to our Annual Report on Form 10-K for the year ended December 31, 2024 (2024 Annual Report to Shareholders).

Premiums Receivable

We perform analyses to evaluate our premiums receivable for expected credit losses. See our 2024 Annual Report to Shareholders for a discussion on our premiums receivable allowance for credit loss policy. The following table summarizes changes in our allowance for credit loss exposure on our premiums receivable:


	Three Months Ended June 30,				Six Months Ended June 30,
(millions)	2025		2024		2025		2024
Allowance for credit losses, beginning of period	$	473	$	328	$	460	$	369
Increase in allowance 1	176		128		329		235
Write-offs 2	( 148 )		( 128 )		( 288 )		( 276 )
Allowance for credit losses, end of period	$	501	$	328	$	501	$	328

1 Represents the incremental increase in other underwriting expenses.

2 Represents the portion of allowance that is reversed when the premiums receivable balances are written off. Premiums receivable balances are written off once we have exhausted our collection efforts.

Property – Held for Sale

At June 30, 2025 and 2024, and December 31, 2024, we had held for sale properties of $ 117 million, $ 152 million, and $ 129 million, respectively, which are included in other assets on our consolidated balance sheets.

New Accounting Standards

We did not adopt any new accounting standards during the three and six months ended June 30, 2025, and there were no recently issued accounting standards that are expected to materially impact our financial condition or results of operations.

2. INVESTMENTS

The following tables present the composition of our investment portfolio by major security type:


($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
June 30, 2025
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	46,684	$	598	$	( 472 )	$	0	$	46,810	52.8	%
State and local government obligations	3,030		12		( 78 )		0		2,964		3.3
Foreign government obligations	17		0		0		0		17		0
Corporate and other debt securities	18,004		222		( 112 )		8		18,122		20.5
Residential mortgage-backed securities	2,644		21		( 7 )		2		2,660		3.0
Commercial mortgage-backed securities	5,325		10		( 286 )		0		5,049		5.7
Other asset-backed securities	6,668		26		( 44 )		0		6,650		7.5

Total fixed maturities	82,372		889		( 999 )		10		82,272		92.8
Short-term investments	2,103		0		0		0		2,103		2.4
Total available-for-sale securities	84,475		889		( 999 )		10		84,375		95.2
Equity securities:
Nonredeemable preferred stocks	517		0		0		( 17 )		500		0.6
Common equities	775		0		0		2,960		3,735		4.2
Total equity securities	1,292		0		0		2,943		4,235		4.8
Total portfolio 1	$	85,767	$	889	$	( 999 )	$	2,953	$	88,610	100.0	%


($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
June 30, 2024
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	42,063	$	60	$	( 1,229 )	$	0	$	40,894	56.5	%
State and local government obligations	2,345		1		( 144 )		0		2,202		3.0
Foreign government obligations	17		0		( 1 )		0		16		0.1
Corporate and other debt securities	13,439		33		( 306 )		( 20 )		13,146		18.1
Residential mortgage-backed securities	981		2		( 9 )		2		976		1.3
Commercial mortgage-backed securities	4,457		2		( 489 )		0		3,970		5.5
Other asset-backed securities	6,366		8		( 89 )		0		6,285		8.7

Total fixed maturities	69,668		106		( 2,267 )		( 18 )		67,489		93.2
Short-term investments	733		0		0		0		733		1.0
Total available-for-sale securities	70,401		106		( 2,267 )		( 18 )		68,222		94.2
Equity securities:
Nonredeemable preferred stocks	887		0		0		( 49 )		838		1.2
Common equities	708		0		0		2,588		3,296		4.6
Total equity securities	1,595		0		0		2,539		4,134		5.8
Total portfolio 1	$	71,996	$	106	$	( 2,267 )	$	2,521	$	72,356	100.0	%


($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
December 31, 2024
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	47,103	$	36	$	( 1,151 )	$	0	$	45,988	57.3	%
State and local government obligations	2,893		2		( 117 )		0		2,778		3.5
Foreign government obligations	16		0		0		0		16		0
Corporate and other debt securities	14,111		65		( 215 )		( 7 )		13,954		17.4
Residential mortgage-backed securities	1,600		9		( 11 )		3		1,601		2.0
Commercial mortgage-backed securities	4,721		7		( 376 )		0		4,352		5.4
Other asset-backed securities	6,682		26		( 65 )		0		6,643		8.3

Total fixed maturities	77,126		145		( 1,935 )		( 4 )		75,332		93.9
Short-term investments	615		0		0		0		615		0.7
Total available-for-sale securities	77,741		145		( 1,935 )		( 4 )		75,947		94.6
Equity securities:
Nonredeemable preferred stocks	756		0		0		( 28 )		728		0.9
Common equities	745		0		0		2,830		3,575		4.5
Total equity securities	1,501		0		0		2,802		4,303		5.4
Total portfolio 1	$	79,242	$	145	$	( 1,935 )	$	2,798	$	80,250	100.0	%

1 At June 30, 2025 and 2024 and December 31, 2024, we had $ 303 million, $ 74 million, and $ 125 million, respectively, of net unsettled security transactions included in accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets.

The total fair value of the portfolio at June 30, 2025 and 2024 and December 31, 2024, included $ 5.0 billion, $ 4.1 billion, and $ 6.2 billion, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of unsettled security transactions. A portion of the investments held at December 31, 2024 were sold and proceeds were used to pay our common share dividends in January 2025; see Note 9 – Dividends for additional information.

The June 30, 2024, corporate and other debt securities in our Note 2 – Investments and Note 3 – Fair Value tables include amounts that were previously reported as redeemable preferred stocks. The reclassification was to reflect the accurate categorization based on the underlying features of these securities; see Note 2 – Investments in our 2024 Annual Report to Shareholders for further discussion.

At June 30, 2025, bonds and certificates of deposit in the principal amount of $ 786 million were on deposit to meet state insurance regulatory requirements. We did no t hold any securities of any one issuer, excluding U.S. government obligations, with an aggregate cost or fair value exceeding 10% of total shareholders’ equity at June 30, 2025 or 2024, or December 31, 2024. At June 30, 2025, we did no t hold any debt securities that were non-income producing during the preceding 12 months.

Hybrid Securities Certain securities in our fixed-maturity portfolio are accounted for as hybrid securities because they contain embedded derivatives that are not deemed to be clearly and closely related to the host investments. These securities are reported at fair value:


	June 30,
(millions)	2025		2024		December 31, 2024
Fixed Maturities:
Corporate and other debt securities	$	731	$	610	$	608
Residential mortgage-backed securities	615		273		479
Other asset-backed securities	0		5		1

Total hybrid securities	$	1,346	$	888	$	1,088

Since the embedded derivatives (e.g., change-in-control put option, debt-to-equity conversion, or any other feature unrelated to the credit quality or risk of default of the issuer that could impact the amount or timing of our expected future cash flows) do not have observable intrinsic values, we use the fair value option to record the changes in fair value of these securities through income as a component of net realized gains (losses).

Fixed Maturities The composition of fixed maturities by maturity at June 30, 2025, was:


(millions)	Cost		Fair Value
Less than one year	$	8,582	$	8,547
One to five years	49,855		49,697
Five to ten years	23,657		23,747
Ten years or greater	278		281
Total	$	82,372	$	82,272

Asset-backed securities are classified in the maturity distribution table based upon their projected cash flows. All other securities that do not have a single maturity date are reported based upon expected average maturity. Contractual maturities may differ from expected maturities because the issuers of the securities may have the right to call or prepay obligations.

Gross Unrealized Losses The following tables show the composition of gross unrealized losses by major security type and by the length of time that individual securities have been in a continuous unrealized loss position:


	Total No. of Sec.	Total Fair Value		Gross Unrealized Losses		Less than 12 Months					12 Months or Greater
($ in millions)						No. of Sec.	Fair Value		Gross Unrealized Losses		No. of Sec.	Fair Value		Gross Unrealized Losses
June 30, 2025
U.S. government obligations	73	$	10,463	$	( 472 )	9	$	2,878	$	( 20 )	64	$	7,585	$	( 452 )
State and local government obligations	275	1,677		( 78 )		53	289		( 1 )		222	1,388		( 77 )

Corporate and other debt securities	159	3,737		( 112 )		28	610		( 6 )		131	3,127		( 106 )
Residential mortgage-backed securities	29	385		( 7 )		11	342		( 2 )		18	43		( 5 )
Commercial mortgage-backed securities	153	3,331		( 286 )		16	448		( 2 )		137	2,883		( 284 )
Other asset-backed securities	79	1,797		( 44 )		40	880		( 2 )		39	917		( 42 )

Total fixed maturities	768	$	21,390	$	( 999 )	157	$	5,447	$	( 33 )	611	$	15,943	$	( 966 )


	Total No. of Sec.	Total Fair Value		Gross Unrealized Losses		Less than 12 Months					12 Months or Greater
($ in millions)						No. of Sec.	Fair Value		Gross Unrealized Losses		No. of Sec.	Fair Value		Gross Unrealized Losses
June 30, 2024
U.S. government obligations	117	$	29,776	$	( 1,229 )	17	$	12,936	$	( 110 )	100	$	16,840	$	( 1,119 )
State and local government obligations	336	2,079		( 144 )		58	411		( 2 )		278	1,668		( 142 )
Foreign government obligations	1	16		( 1 )		0	0		0		1	16		( 1 )
Corporate and other debt securities	405	9,032		( 306 )		150	3,307		( 19 )		255	5,725		( 287 )
Residential mortgage-backed securities	39	308		( 9 )		7	244		0		32	64		( 9 )
Commercial mortgage-backed securities	183	3,883		( 489 )		7	315		( 1 )		176	3,568		( 488 )
Other asset-backed securities	176	3,133		( 89 )		62	1,447		( 3 )		114	1,686		( 86 )

Total fixed maturities	1,257	$	48,227	$	( 2,267 )	301	$	18,660	$	( 135 )	956	$	29,567	$	( 2,132 )


	Total No. of Sec.	Total Fair Value		Gross Unrealized Losses		Less than 12 Months					12 Months or Greater
($ in millions)						No. of Sec.	Fair Value		Gross Unrealized Losses		No. of Sec.	Fair Value		Gross Unrealized Losses
December 31, 2024
U.S. government obligations	113	$	38,782	$	( 1,151 )	39	$	30,257	$	( 418 )	74	$	8,525	$	( 733 )
State and local government obligations	379	2,339		( 117 )		127	783		( 6 )		252	1,556		( 111 )

Corporate and other debt securities	304	7,034		( 215 )		122	2,935		( 33 )		182	4,099		( 182 )
Residential mortgage-backed securities	40	428		( 11 )		12	377		( 4 )		28	51		( 7 )
Commercial mortgage-backed securities	153	3,294		( 376 )		8	264		( 16 )		145	3,030		( 360 )
Other asset-backed securities	84	1,907		( 65 )		34	912		( 8 )		50	995		( 57 )

Total fixed maturities	1,073	$	53,784	$	( 1,935 )	342	$	35,528	$	( 485 )	731	$	18,256	$	( 1,450 )

A review of the securities in an unrealized loss position indicated that the issuers were current with respect to their interest obligations and that there was no evidence of deterioration of the current cash flow projections that would indicate we would not receive the remaining principal at maturity.

Allowance For Credit and Uncollectible Losses We are required to measure the amount of potential credit losses for all fixed-maturity securities in an unrealized loss position. We did no t record any allowances for credit losses or any write-offs for credit losses deemed to be uncollectible during the first six months of 2025 or 2024, and did no t have a material credit loss allowance balance as of June 30, 2025 and 2024, or December 31, 2024. We considered several factors and inputs related to the individual securities as part of our analysis. The methodology and significant inputs used to measure the amount of credit losses in our portfolio included:

• current performance indicators on the business model or underlying assets (e.g., delinquency rates, foreclosure rates, and default rates);

• credit support (via current levels of subordination);

• historical credit ratings; and

• updated cash flow expectations based upon these performance indicators.

We initially reviewed securities in a loss position to determine whether we intended, or if it was more likely than not that we would be required, to sell any of the securities prior to the recovery of their respective cost bases (which could be maturity). If we were more likely than not, or intended, to sell prior to a potential recovery, we would write off the unrealized loss. No unrealized loss write offs were recorded during the six months ended June 30, 2025 or 2024.

For those securities that we determined we were not likely to, or did not intend to, sell prior to a potential recovery, we performed additional analysis to determine if the loss was credit related. For securities with a potential credit-related loss, we calculated the net present value (NPV) of the cash flows expected (i.e., expected recovery value) using the current book yield for each security. The NPV was then compared to the security’s current amortized cost basis to determine if a credit loss existed. If the NPV was below the amortized cost basis, and deemed material for any specific security, or in the aggregate, a credit loss would be recognized and either a new allowance for credit losses would be recorded, or adjustments would be made to a previous allowance. All changes to new or existing allowances for credit losses are recorded to net realized gains (losses) on securities.

As of June 30, 2025 and 2024, and December 31, 2024, we believe that none of the unrealized losses on our fixed-maturity securities were related to material credit losses on any specific securities, or in the aggregate. We continue to expect all the securities in our fixed-maturity portfolio to pay their principal and interest obligations.

In addition, we reviewed our accrued investment income outstanding on those securities in an unrealized loss position at June 30, 2025 and 2024, and December 31, 2024, to determine if the accrued interest amounts were uncollectible. Based on our analysis, we believe the issuers have sufficient liquidity and capital reserves to meet their current interest, and future principal obligations and, therefore, did no t write off any accrued income as uncollectible at June 30, 2025 and 2024, or December 31, 2024.

Realized Gains (Losses) The components of net realized gains (losses) for the three and six months ended June 30, were:


	Three Months				Six Months
(millions)	2025		2024		2025		2024
Gross realized gains on security sales
Available-for-sale securities:
U.S. government obligations	$	24	$	1	$	77	$	1

Corporate and other debt securities	2		1		3		4
Residential mortgage-backed securities	1		1		1		1




Total available-for-sale securities	27		3		81		6
Equity securities:
Nonredeemable preferred stocks	0		0		2		0
Common equities	4		0		39		12
Total equity securities	4		0		41		12

Subtotal gross realized gains on security sales	31		3		122		18
Gross realized losses on security sales
Available-for-sale securities:
U.S. government obligations	( 1 )		( 192 )		( 78 )		( 327 )
State and local government obligations	0		0		( 2 )		0
Corporate and other debt securities	( 2 )		( 23 )		( 3 )		( 38 )

Commercial mortgage-backed securities	( 6 )		( 10 )		( 10 )		( 15 )



Total available-for-sale securities	( 9 )		( 225 )		( 93 )		( 380 )
Equity securities:
Nonredeemable preferred stocks	( 3 )		( 5 )		( 5 )		( 11 )
Common equities	0		0		( 4 )		0
Total equity securities	( 3 )		( 5 )		( 9 )		( 11 )
Subtotal gross realized losses on security sales	( 12 )		( 230 )		( 102 )		( 391 )
Net realized gains (losses) on security sales
Available-for-sale securities:
U.S. government obligations	23		( 191 )		( 1 )		( 326 )
State and local government obligations	0		0		( 2 )		0
Corporate and other debt securities	0		( 22 )		0		( 34 )
Residential mortgage-backed securities	1		1		1		1
Commercial mortgage-backed securities	( 6 )		( 10 )		( 10 )		( 15 )



Total available-for-sale securities	18		( 222 )		( 12 )		( 374 )
Equity securities:
Nonredeemable preferred stocks	( 3 )		( 5 )		( 3 )		( 11 )
Common equities	4		0		35		12
Total equity securities	1		( 5 )		32		1

Subtotal net realized gains (losses) on security sales	19		( 227 )		20		( 373 )




Net holding period gains (losses)
Hybrid securities	11		3		14		11
Equity securities	357		97		141		391

Subtotal net holding period gains (losses)	368		100		155		402





Total net realized gains (losses) on securities	$	387	$	( 127 )	$	175	$	29

Realized gains (losses) on securities sold are computed using the first-in-first-out method. During the second quarter and first six months of 2025 and 2024, the majority of our security sales were U.S. Treasury Notes that were sold for duration management. We also selectively sold securities that we viewed as having less attractive risk/reward profiles during the second quarter and first six months of 2025 and 2024.

The following table reflects our holding period realized gains (losses) recognized on equity securities held at the respective quarter ends:


	Three Months				Six Months
(millions)	2025		2024		2025		2024
Total net gains (losses) recognized during the period on equity securities	$	358	$	92	$	173	$	392
Less: Net gains (losses) recognized on equity securities sold during the period	1		( 5 )		32		1
Net holding period gains (losses) recognized during the period on equity securities held at period end	$	357	$	97	$	141	$	391

Net Investment Income The components of net investment income for the three and six months ended June 30, were:


	Three Months				Six Months
(millions)	2025		2024		2025		2024
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	422	$	361	$	844	$	668
State and local government obligations	21		13		40		26

Corporate and other debt securities	208		137		379		262
Residential mortgage-backed securities	32		8		57		13
Commercial mortgage-backed securities	59		47		112		93
Other asset-backed securities	84		82		168		160

Total fixed maturities	826		648		1,600		1,222
Short-term investments	28		17		46		36
Total available-for-sale securities	854		665		1,646		1,258
Equity securities:
Nonredeemable preferred stocks	5		10		13		21
Common equities	12		10		26		24
Total equity securities	17		20		39		45
Investment income	871		685		1,685		1,303
Investment expenses	( 9 )		( 7 )		( 16 )		( 13 )
Net investment income	$	862	$	678	$	1,669	$	1,290

On a year-over-year basis, investment income (interest and dividends) increased 27% and 29 % for the three and six months ended June 30, 2025, respectively, compared to the same periods last year . The increases primarily reflect growth in invested assets and an increase in recurring investment book yield. The book yield increase primarily reflected investing new cash from insurance operations, and proceeds from maturing bonds, in higher coupon rate securities.

3. FAIR VALUE

We have categorized our financial instruments, based on the degree of subjectivity inherent in the method by which they are valued, into a fair value hierarchy of three levels, as follows:

• Level 1 : Inputs are unadjusted, quoted prices in active markets for identical instruments at the measurement date (e.g., U.S. government obligations, which are continually priced on a daily basis, active exchange-traded equity securities, and certain short-term investments).

• Level 2 : Inputs (other than quoted prices included within Level 1) that are observable for the instrument either directly or indirectly. This includes: (i) quoted prices for similar instruments in active markets, (ii) quoted prices for identical or similar instruments in markets that are not active, (iii) inputs other than quoted prices that are observable for the instruments, and (iv) inputs that

are derived principally from or corroborated by observable market data by correlation or other means.

• Level 3 : Inputs that are unobservable. Unobservable inputs reflect our subjective evaluation about the assumptions market participants would use in pricing the financial instrument (e.g., certain privately held investments).

Determining the fair value of the investment portfolio is the responsibility of management. As part of that responsibility, we evaluate whether a market is distressed or inactive in determining the fair value for our portfolio. We review certain market level inputs to evaluate whether sufficient activity, volume, and new issuances exist to create an active market. Based on this evaluation, we concluded that there was sufficient activity related to the sectors and securities for which we obtained valuations.

The composition of the investment portfolio by major security type and our outstanding debt was:


	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
June 30, 2025
Fixed maturities:
U.S. government obligations	$	46,810	$	0	$	0	$	46,810	$	46,684
State and local government obligations	0		2,964		0		2,964		3,030
Foreign government obligations	0		17		0		17		17
Corporate and other debt securities	0		18,117		5		18,122		18,004
Residential mortgage-backed securities	0		2,660		0		2,660		2,644
Commercial mortgage-backed securities	0		5,049		0		5,049		5,325
Other asset-backed securities	0		6,650		0		6,650		6,668





Total fixed maturities	46,810		35,457		5		82,272		82,372
Short-term investments	1,922		181		0		2,103		2,103
Total available-for-sale securities	48,732		35,638		5		84,375		84,475
Equity securities:

Nonredeemable preferred stocks	0		440		60		500		517



Common equities:
Common stocks	3,694		0		9		3,703		743
Other risk investments	0		0		32		32		32
Subtotal common equities	3,694		0		41		3,735		775
Total equity securities	3,694		440		101		4,235		1,292
Total portfolio	$	52,426	$	36,078	$	106	$	88,610	$	85,767
Debt	$	0	$	6,294	$	0	$	6,294	$	6,895


	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
June 30, 2024
Fixed maturities:
U.S. government obligations	$	40,894	$	0	$	0	$	40,894	$	42,063
State and local government obligations	0		2,202		0		2,202		2,345
Foreign government obligations	0		16		0		16		17
Corporate and other debt securities	0		13,143		3		13,146		13,439
Residential mortgage-backed securities	0		976		0		976		981
Commercial mortgage-backed securities	0		3,970		0		3,970		4,457
Other asset-backed securities	0		6,285		0		6,285		6,366





Total fixed maturities	40,894		26,592		3		67,489		69,668
Short-term investments	733		0		0		733		733
Total available-for-sale securities	41,627		26,592		3		68,222		70,401
Equity securities:

Nonredeemable preferred stocks	0		786		52		838		887



Common equities:
Common stocks	3,250		0		22		3,272		684
Other risk investments	0		0		24		24		24
Subtotal common equities	3,250		0		46		3,296		708
Total equity securities	3,250		786		98		4,134		1,595
Total portfolio	$	44,877	$	27,378	$	101	$	72,356	$	71,996
Debt	$	0	$	6,166	$	0	$	6,166	$	6,891


	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
December 31, 2024
Fixed maturities:
U.S. government obligations	$	45,988	$	0	$	0	$	45,988	$	47,103
State and local government obligations	0		2,778		0		2,778		2,893
Foreign government obligations	0		16		0		16		16
Corporate and other debt securities	0		13,949		5		13,954		14,111
Residential mortgage-backed securities	0		1,601		0		1,601		1,600
Commercial mortgage-backed securities	0		4,352		0		4,352		4,721
Other asset-backed securities	0		6,643		0		6,643		6,682





Total fixed maturities	45,988		29,339		5		75,332		77,126
Short-term investments	613		2		0		615		615
Total available-for-sale securities	46,601		29,341		5		75,947		77,741
Equity securities:

Nonredeemable preferred stocks	0		676		52		728		756



Common equities:
Common stocks	3,527		0		23		3,550		720
Other risk investments	0		0		25		25		25
Subtotal common equities	3,527		0		48		3,575		745
Total equity securities	3,527		676		100		4,303		1,501
Total portfolio	$	50,128	$	30,017	$	105	$	80,250	$	79,242
Debt	$	0	$	6,173	$	0	$	6,173	$	6,893

Our portfolio valuations, excluding short-term investments valued at original cost, classified as either Level 1 or Level 2 in the above tables are priced exclusively by external sources, including pricing vendors, dealers/market makers, and exchange-quoted prices.

Our short-term investments classified as Level 1 include commercial paper, treasury bills, and money market funds which are highly liquid, actively marketed, and have very short durations. These securities are valued at their original cost, adjusted for any accretion of discount, which approximates fair value because of the relatively short period of time until maturity. The remainder of our short-term investments with a trade date to maturity of less than a year are classified as Level 2. These securities are classified as Level 2 since they are valued using external pricing vendor prices or are securities that continually trade at par value because they contain either liquidity facilities or mandatory put features within one year and as a result are valued at their original cost.

At June 30, 2025 and 2024 and December 31, 2024, vendor-quoted prices represented 93 % of our Level 1 classifications (excluding short-term investments valued at original cost). The securities quoted by vendors in Level 1 primarily represent our holdings in U.S. Treasury Notes, which are frequently traded, and the quotes are considered similar to exchange-traded quotes. The balance of our Level 1 pricing comes from quotes obtained directly from trades made on active exchanges.

At June 30, 2025, vendor-quoted prices comprised 99 % of our Level 2 classifications (excluding short-term investments valued at original cost), with the balance from

dealer quotes, compared to 100 % at June 30, 2024 and December 31, 2024. In our process for selecting a source (e.g., dealer or pricing service) to provide pricing for securities in our portfolio, we reviewed documentation from the sources that detailed the pricing techniques and methodologies used by these sources and determined if their policies adequately considered market activity, either based on specific transactions for the particular security type or based on modeling of securities with similar credit quality, duration, yield, and structure that were recently transacted. Once a source is chosen, we continue to monitor any changes or modifications to their processes by reviewing their documentation on internal controls for pricing and market reviews. We review quality control measures of our sources as they become available to determine if any significant changes have occurred from period to period that might indicate issues or concerns regarding their evaluation or market coverage.

As part of our pricing procedures, we obtain quotes from more than one source to help us fully evaluate the market price of securities. However, our internal pricing policy is to use a consistent source for individual securities in order to maintain the integrity of our valuation process. Quotes obtained from the sources are not considered binding offers to transact. Under our policy, when a review of the valuation received from our selected source appears to be outside of what is considered market level activity (which is defined as trading at spreads or yields significantly different than those of comparable securities or outside the general sector level movement without a reasonable explanation), we may use an alternate source’s price. To the extent we determine that it may be prudent to substitute

one source’s price for another, we will contact the initial source to obtain an understanding of the factors that may be contributing to the significant price variance.

To allow us to determine if our initial source is providing a price that is outside of a reasonable range, we review our portfolio pricing on a weekly basis. When necessary, we challenge prices from our sources when a price provided does not match our expectations based on our evaluation of market trends and activity. Initially, we perform a review of our portfolio by sector to identify securities whose prices appear outside of a reasonable range. We then perform a more detailed review of fair values for securities disclosed as Level 2. We review dealer bids and quotes for these and/or similar securities to determine the market level context for our valuations. We then evaluate inputs relevant for each class of securities disclosed in the preceding hierarchy tables.

For structured debt securities, including commercial, residential, and other asset-backed securities, we evaluate available market-related data for these and similar securities related to collateral, delinquencies, and defaults for historical trends and reasonably estimable projections, as well as historical prepayment rates and current prepayment assumptions and cash flow estimates. We further stratify each class of structured debt securities into more finite sectors (e.g., planned amortization class, first pay, second pay, senior, and subordinated) and use duration, credit quality, and coupon to determine if the fair value is appropriate.

For corporate and other debt, nonredeemable preferred stock, and the notes issued by The Progressive Corporation (see Note 4 – Debt ), we review securities by duration, credit quality, and coupon, as well as changes in interest rate and credit spread movements within that stratification. The review also includes recent trades, including: volume traded at various levels that establish a market; issuer specific fundamentals; and industry-specific economic news as it comes to light.

For municipal securities (e.g., general obligations, revenue, and housing), we stratify the portfolio to evaluate securities by type, duration, credit quality, and coupon to review price changes relative to credit spread and interest rate changes. Additionally, we look to economic data as it relates to geographic location as an indication of price-to-call or maturity predictors. For municipal housing securities, we look to changes in cash flow projections, both historical and reasonably estimable projections, to understand yield changes and their effect on valuation.

For short-term investments valued at original cost, we look at acquisition price relative to the coupon or yield. Since most of these securities are 60 days or less to maturity, we believe that original cost is the best estimate of fair value. For short-term investments valued with external vendor prices, we review securities by duration, credit quality, and coupon, as well as changes in interest rate and credit spread movements within that stratification, and recent trade information.

We also review data assumptions as supplied by our sources to determine if that data is relevant to current

market conditions. In addition, we independently review each sector for transaction volumes, new issuances, and changes in spreads, as well as the overall movement of interest rates along the yield curve to determine if sufficient activity and liquidity exists to provide a credible source for our market valuations.

During each valuation period, we create internal estimations of portfolio valuation (performance returns), based on current market-related activity (i.e., interest rate and credit spread movements and other credit-related factors) within each major sector of our portfolio. We compare our internally generated portfolio results with those generated based on quotes we receive externally and research material valuation differences. We compare our results to index returns for each major sector adjusting for duration and credit quality differences to better understand our portfolio’s results. Additionally, we review on a monthly basis our external sales transactions and compare the actual final market sales prices to previous market valuation prices. This review provides us further validation that our pricing sources are providing market level prices, since we are able to explain significant price changes (i.e., greater than 2%) as known events occur in the marketplace and affect a particular security’s price at sale.

This analysis provides us with additional comfort regarding the source’s process, the quality of its review, and its willingness to improve its analysis based on feedback from clients. We believe this effort helps ensure that we are reporting the most representative fair values for our securities.

After all the valuations are received and our review of Level 2 securities is complete, if the inputs used by vendors are determined to not contain sufficient observable market information, we will reclassify the affected securities to Level 3.

Except as described below, our Level 3 securities are priced externally; however, due to several factors (e.g., nature of the securities, level of activity, and lack of similar securities trading to obtain observable market level inputs), these valuations are more subjective in nature.

To the extent we receive prices from external sources (e.g., broker and valuation firm) for the Level 3 securities, we review those prices for reasonableness using internally developed assumptions and then compare our derived prices to the prices received from the external sources. Based on our review, all prices received from external sources remained unadjusted.

If we do not receive prices from an external source, we perform an internal fair value comparison, which includes a review and analysis of market-comparable securities, to determine if fair value changes are needed. Based on this analysis, certain private equity investments included in the

Level 3 category remain valued at cost or were priced using a recent transaction as the basis for fair value. At least annually, these private equity investments are priced by an external source.

Our Level 3 other risk investments include securities accounted for under the equity method of accounting and, therefore, are not subject to fair value reporting. Since these securities represent less than 0.1% of our total portfolio, we include them in our Level 3 disclosures and report the activity from these investments as “other” changes in the summary of changes in fair value table and categorize these securities as “pricing exemption securities” in the quantitative information table.

During the first six months of 2025 and for the full year of 2024, there were no material assets or liabilities measured at fair value on a nonrecurring basis.

Due to the relative size of the Level 3 securities’ fair values, compared to the total portfolio’s fair value, any changes in pricing methodology would not have a significant change in valuation that would materially impact net or comprehensive income.

The following tables provide a summary of changes in fair value associated with Level 3 assets for the three and six months ended June 30, 2025 and 2024:



(millions)	Fair Value at March 31, 2025		Calls/ Maturities/ Paydowns/Other		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation 1		Net Transfers In (Out)		Fair Value at June 30, 2025
Fixed maturities:
Corporate and other debt securities	$	5	$	0	$	0	$	0	$	0	$	0	$	0	$	5
Equity securities:

Nonredeemable preferred stocks	60		0		0		0		0		0		0		60

Common equities:
Common stocks	9		0		0		0		0		0		0		9
Other risk investments	31		1		0		0		0		0		0		32
Total Level 3 securities	$	105	$	1	$	0	$	0	$	0	$	0	$	0	$	106






(millions)	Fair Value at March 31, 2024		Calls/ Maturities/ Paydowns/Other		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation 1		Net Transfers In (Out)		Fair Value at June 30, 2024
Fixed maturities:
Corporate and other debt securities	$	3	$	0	$	0	$	0	$	0	$	0	$	0	$	3
Equity securities:

Nonredeemable preferred stocks	64		0		0		0		0		( 12 )		0		52

Common equities:
Common stocks	22		0		0		0		0		0		0		22
Other risk investments	25		( 1 )		0		0		0		0		0		24
Total Level 3 securities	$	114	$	( 1 )	$	0	$	0	$	0	$	( 12 )	$	0	$	101



(millions)	Fair Value at December 31, 2024		Calls/ Maturities/ Paydowns/Other		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation 1		Net Transfers In (Out)		Fair Value at June 30, 2025
Fixed maturities:
Corporate and other debt securities	$	5	$	0	$	0	$	0	$	0	$	0	$	0	$	5
Equity securities:

Nonredeemable preferred stocks	52		0		8		0		0		0		0		60

Common equities:
Common stocks	23		0		0		0		0		( 14 )		0		9
Other risk investments	25		7		0		0		0		0		0		32
Total Level 3 securities	$	105	$	7	$	8	$	0	$	0	$	( 14 )	$	0	$	106









(millions)	Fair Value at December 31, 2023		Calls/ Maturities/ Paydowns/Other		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation 1		Net Transfers In (Out)		Fair Value at June 30, 2024
Fixed maturities:
Corporate and other debt securities	$	3	$	0	$	0	$	0	$	0	$	0	$	0	$	3
Equity securities:
Nonredeemable preferred stocks	64		0		0		0		0		( 12 )		0		52

Common equities:
Common stocks	22		0		0		0		0		0		0		22
Other risk investments	21		3		0		0		0		0		0		24
Total Level 3 securities	$	110	$	3	$	0	$	0	$	0	$	( 12 )	$	0	$	101

1 For fixed maturities, these amounts are included in accumulated other comprehensive income (loss) on our consolidated balance sheets. For equity securities, these amounts are included in our consolidated statements of comprehensive income.

The following tables provide a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at June 30, 2025 and 2024, and December 31, 2024:

($ in millions)

Fair Value at June 30, 2025

Valuation Technique

Unobservable Input

Range of Input Values Increase (Decrease)

Weighted Average Increase (Decrease)

Fixed maturities:

Corporate and other debt securities

Market comparables

Weighted average market capitalization price change %

0.6 % to 0.8 %

0.7

Equity securities:

Nonredeemable preferred stocks

Market comparables

Weighted average market capitalization price change %

( 13.1 )% to 22.7 %

3.7

Common stocks

Market comparables

Weighted average market capitalization price change %

( 26.3 )% to 56.6 %

21.3

Subtotal Level 3 securities

Pricing exemption securities

Total Level 3 securities

106

($ in millions)

Fair Value at June 30, 2024

Valuation Technique

Unobservable Input

Range of Input Values Increase (Decrease)

Weighted Average Increase (Decrease)

Fixed maturities:

Corporate and other debt securities

Market comparables

Weighted average market capitalization price change %

( 1.2 )% to 1.2 %

0.2

Equity securities:

Nonredeemable preferred stocks

Market comparables

Weighted average market capitalization price change %

( 7.6 )% to ( 1.5 )%

( 2.9 )

Common stocks

Market comparables

Weighted average market capitalization price change %

( 26.5 )% to 19.3 %

( 4.4 )

Subtotal Level 3 securities

Pricing exemption securities

Total Level 3 securities

101

($ in millions)

Fair Value at December 31, 2024

Valuation Technique

Unobservable Input

Range of Input Values Increase (Decrease)

Weighted Average Increase (Decrease)

Fixed maturities:

Corporate and other debt securities

Market comparables

Weighted average market capitalization price change %

( 1.4 )% to ( 1.3 )%

( 1.4 )

Equity securities:

Nonredeemable preferred stocks

Market comparables

Weighted average market capitalization price change %

( 14.1 )% to 6.0 %

( 2.7 )

Common stocks

Market comparables

Weighted average market capitalization price change %

( 41.3 )% to 95.9 %

6.0

Subtotal Level 3 securities

Pricing exemption securities

Total Level 3 securities

105

4. DEBT

Debt at each of the balance sheet periods consisted of the following Senior Notes:


($ in millions)						June 30, 2025				June 30, 2024			December 31, 2024
Principal Amount		Interest Rate		Issuance Date	Maturity Date	Carrying Value		Fair Value			Carrying Value		Fair Value		Carrying Value		Fair Value
$	500	2.45	%	August 2016	2027	$	499	$	488		$	499	$	469	$	499	$	479
500		2.50		March 2022	2027	499		487			498		468		499		479
300		6 5/8		March 1999	2029	298		324			298		321		298		320
550		4.00		October 2018	2029	548		547			547		527		547		534
500		3.20		March 2020	2030	498		477			497		455		498		462
500		3.00		March 2022	2032	497		456			497		434		497		439
400		6.25		November 2002	2032	397		438			397		428		397		430
500		4.95		May 2023	2033	497		511			497		495		497		495
350		4.35		April 2014	2044	347		299			347		301		347		298
400		3.70		January 2015	2045	396		310			396		310		396		308
850		4.125		April 2017	2047	843		699			842		699		842		684
600		4.20		March 2018	2048	591		493			591		494		591		490
500		3.95		March 2020	2050	491		392			491		392		491		386
500		3.70		March 2022	2052	494		373			494		373		494		369
Total						$	6,895	$	6,294		$	6,891	$	6,166	$	6,893	$	6,173

There was no short-term debt outstanding as of the end of all periods presented.

During the second quarter 2025, The Progressive Corporation renewed its line of credit with PNC Bank, National Association (PNC), in the maximum principal amount of $ 300 million, which expires April 2026 and has the same terms as the previous line of credit with PNC. See the 2024 Annual Report to Shareholders for a discussion of the terms of this line of credit. We had no borrowings under the line of credit that was available during the periods presented.

5. INCOME TAXES

The effective tax rate for the three and six months ended June 30, 2025, was 20.3 % and 20.4 %, respectively , compared to 21.6 % and 21.0 % for the same periods last year. The decrease in effective tax rate is primarily due to the tax benefits associated with distributions of deferred compensation during the second quarter 2025.

Deferred income taxes reflect the tax effects of temporary differences between the financial statement carrying amounts and the tax bases of assets and liabilities. Although realization of the deferred tax assets is not assured, management believes that it is more likely than not that the deferred tax assets will be realized based on our expectation that we will be able to fully utilize the deductions that are ultimately recognized for tax purposes and, therefore, no valuation allowance was needed at June 30, 2025 and 2024, and December 31, 2024.

We had net current income taxes recoverable of $ 115 million at June 30, 2025, which were reported in other assets on our consolidated balance sheets, compared to net current income taxes payable of $ 9 million and $ 26 million at June 30, 2024 and December 31, 2024, respectively, which were reported in accounts payable, accrued expenses, and other liabilities. The balance may fluctuate from period to period due to normal timing differences.

At June 30, 2025 and 2024, and December 31, 2024, we have not recorded any unrecognized tax benefits or related interest and penalties.

6. LOSS AND LOSS ADJUSTMENT EXPENSE RESERVES

Activity in the loss and loss adjustment expense reserves is summarized as follows:


	June 30,
(millions)	2025		2024
Balance at January 1	$	39,057	$	34,389
Less reinsurance recoverables on unpaid losses	4,487		4,789
Net balance at January 1	34,570		29,600
Incurred related to:
Current year	27,016		23,630
Prior years	( 607 )		( 63 )
Total incurred	26,409		23,567
Paid related to:
Current year	12,842		11,470
Prior years	10,883		9,607
Total paid	23,725		21,077
Net balance at June 30	37,254		32,090
Plus reinsurance recoverables on unpaid losses	3,900		4,515
Balance at June 30	$	41,154	$	36,605

We experienced favorable reserve development of $ 607 million and $ 63 million during the first six months of 2025 and 2024, respectively, which is reflected as “incurred related to prior years ” in the table above.

Year-to-date June 30, 2025

• The favorable prior year reserve development included approximately $ 400 million attributable to accident year 2024, $ 115 million to accident year 2023, and the remainder to accident years 2022 and prior.

• Our perso nal auto products incurred about $ 520 million of favorable loss and loss adjustment expense (LAE) reserve development, with the agency and direct auto businesses each contributing about half. The favorable development was primarily due to lower than anticipated loss severity and frequency in Florida and, to a lesser extent, lower than anticipated litigation defense costs across most states.

• Our personal property products experienced about $ 50 million of favorable development, primarily attributable to favorable development on 2024 catastrophe events.

• Our Commercial Lines business experienced about $ 45 million of favorable development, primarily attributable to lower than anticipated severity in our transportation network company business.

Year-to-date June 30, 2024

• The favorable prior year reserve development included approximately $ 60 million of favorable development attributable to accident year 2023 and $ 20 million to accident year 2022; partially offset by unfavorable development attributable to accident years 2021 and prior.

• Our personal auto products incurred about $ 235 million of favorable loss and LAE reserve development, with about 60 % attributable to the agency auto business and the balance in the direct auto business. The favorable development was, in part, due to lower than anticipated frequency in Florida following tort reform that passed in the first quarter 2023 and lower than anticipated property damage severity across the majority of states.

• Our Commercial Lines and personal property businesses experienced about $ 140 million and $ 30 million, respectively, of unfavorable development, with the Commercial Lines development primarily driven by higher than anticipated severity in our commercial auto business for California and New York.

7. SUPPLEMENTAL CASH FLOW INFORMATION

Cash and cash equivalents include bank demand deposits and daily overnight reverse repurchase commitments of funds held in bank demand deposit accounts by certain subsidiaries. The amount of overnight reverse repurchase commitments, which are not considered part of the investment portfolio, held by these subsidiaries at June 30, 2025 and 2024, and December 31, 2024, were $ 80 million, $ 81 million, and $ 127 million, respectively. Restricted cash and restricted cash equivalents include collateral held against unpaid deductibles and cash that is restricted to pay flood claims under the National Flood Insurance Program’s “Write Your Own” program, for which certain subsidiaries are participants.

Non-cash activity included the following in the respective periods:


	Six Months Ended June 30,
(millions)	2025		2024
Common share dividends 1	$	58	$	58
Operating lease liabilities 2	63		47

1 Declared but unpaid. See Note 9 – Dividends for further discussion.

2 From obtaining right-of-use assets.

In the respective periods, we paid the following:


	Six Months Ended June 30,
(millions)	2025		2024
Income taxes	$	1,644	$	1,351
Interest	138		138
Operating lease liabilities	45		43

8. SEGMENT INFORMATION

Our Personal Lines segment writes insurance for personal autos, special lines products (e.g., recreational vehicles, such as motorcycles, RVs, and watercraft), personal residential property insurance for homeowners and renters, umbrella insurance, and flood insurance through the “Write Your Own” program for the National Flood Insurance Program. Property information for the three and six months ended June 30, 2024, was recast to conform to the current year presentation; see Note 10 – Segment Information in our 2024 Annual Report to Shareholders for further discussion.

Our Commercial Lines segment writes auto-related liability and physical damage insurance, business-related

general liability and commercial property insurance predominately for small businesses, and workers’ compensation insurance primarily for the transportation industry.

Our service businesses provide insurance-related services, including serving as an agent for homeowners, general liability, and workers’ compensation insurance, among other products, through programs in our direct Personal Lines and Commercial Lines businesses.

All segment revenues are generated from external customers and all intercompany transactions are eliminated in consolidation.

Following are the operating results for the respective periods:


(millions)	Personal Lines		Commercial Lines		Other 1		Companywide
Three Months Ended June 30, 2025
Net premiums earned	$	17,544	$	2,765	$	1	$	20,310
Fees and other revenues	263		40		0		303
Total underwriting revenue	17,807		2,805		1		20,613
Losses and loss adjustment expenses:
Losses (excluding catastrophe losses)	9,574		1,561		( 1 )		11,134
Catastrophe losses	688		19		0		707
Loss adjustment expenses	1,471		292		1		1,764
Total losses and loss adjustment expenses	11,733		1,872		0		13,605
Underwriting expenses:
Distribution expenses 2	2,328		308		1		2,637
Other underwriting expenses 3	1,298		261		4		1,563
Total underwriting expenses	3,626		569		5		4,200
Pretax underwriting profit (loss)	$	2,448	$	364	$	( 4 )	2,808
Investment profit (loss) 4							1,249
Service businesses profit (loss)							( 6 )
Interest expense							( 69 )
Total pretax profit (loss)							$	3,982


(millions)	Personal Lines		Commercial Lines		Other 1		Companywide
Three Months Ended June 30, 2024
Net premiums earned	$	14,545	$	2,664	$	0	$	17,209
Fees and other revenues	216		44		0		260
Total underwriting revenue	14,761		2,708		0		17,469
Losses and loss adjustment expenses:
Losses (excluding catastrophe losses)	8,148		1,581		( 1 )		9,728
Catastrophe losses	1,243		26		0		1,269
Loss adjustment expenses	1,324		274		0		1,598
Total losses and loss adjustment expenses	10,715		1,881		( 1 )		12,595
Underwriting expenses:
Distribution expenses 2	1,828		284		0		2,112
Other underwriting expenses 3	1,135		239		2		1,376
Total underwriting expenses	2,963		523		2		3,488
Pretax underwriting profit (loss)	$	1,083	$	304	$	( 1 )	1,386
Investment profit (loss) 4							551
Service businesses profit (loss)							( 8 )
Interest expense							( 69 )
Total pretax profit (loss)							$	1,860


(millions)	Personal Lines		Commercial Lines		Other 1		Companywide
Six Months Ended June 30, 2025
Net premiums earned	$	34,254	$	5,464	$	1	$	39,719
Fees and other revenues	512		78		0		590
Total underwriting revenue	34,766		5,542		1		40,309
Losses and loss adjustment expenses:
Losses (excluding catastrophe losses)	18,683		3,120		( 1 )		21,802
Catastrophe losses	1,142		24		0		1,166
Loss adjustment expenses	2,861		579		1		3,441
Total losses and loss adjustment expenses	22,686		3,723		0		26,409
Underwriting expenses:
Distribution expenses 2	4,676		594		1		5,271
Other underwriting expenses 3	2,573		523		8		3,104
Total underwriting expenses	7,249		1,117		9		8,375
Pretax underwriting profit (loss)	$	4,831	$	702	$	( 8 )	5,525
Investment profit (loss) 4							1,844
Service businesses profit (loss)							( 12 )
Interest expense							( 139 )
Total pretax profit (loss)							$	7,218


(millions)	Personal Lines		Commercial Lines		Other 1		Companywide
Six Months Ended June 30, 2024
Net premiums earned	$	28,136	$	5,222	$	0	$	33,358
Fees and other revenues	412		84		0		496
Total underwriting revenue	28,548		5,306		0		33,854
Losses and loss adjustment expenses:
Losses (excluding catastrophe losses)	15,711		3,174		( 3 )		18,882
Catastrophe losses	1,581		35		0		1,616
Loss adjustment expenses	2,521		548		0		3,069
Total losses and loss adjustment expenses	19,813		3,757		( 3 )		23,567
Underwriting expenses:
Distribution expenses 2	3,388		558		0		3,946
Other underwriting expenses 3	2,223		478		4		2,705
Total underwriting expenses	5,611		1,036		4		6,651
Pretax underwriting profit (loss)	$	3,124	$	513	$	( 1 )	3,636
Investment profit (loss) 4							1,319
Service businesses profit (loss)							( 16 )
Interest expense							( 139 )
Total pretax profit (loss)							$	4,800

1 Includes other underwriting businesses and run-off operations.

2 Includes policy acquisition costs, agents’ contingent commissions, and advertising costs attributable to our operating segments. A portion of our companywide advertising costs are also attributed to our service businesses.

3 Primarily consists of employee compensation and benefit costs, and the increase in the allowance for credit loss exposure on our premiums receivable.

4 Calculated as recurring investment income plus total net realized gains (losses) on securities, less investment expenses.

Our management uses underwriting margin and combined ratio as primary measures of underwriting profitability. The underwriting margin is the pretax underwriting profit (loss) expressed as a percentage of net premiums earned. Pretax underwriting profit (loss) is calculated as net premiums earned plus fees and other revenues, less: (i) losses and loss adjustment expenses; (ii) policy acquisition costs; and (iii) other underwriting expenses. Combined ratio is the complement of the underwriting margin. Fees and other revenues are netted against either loss adjustment expenses or underwriting expenses in the ratio calculations, based on the underlying activity that generated the revenue. Following are the underwriting margins and combined ratios for our underwriting operations for the respective periods:


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
	Under- writing Margin		Combined Ratio	Under- writing Margin		Combined Ratio	Under- writing Margin		Combined Ratio	Under- writing Margin		Combined Ratio
Personal Lines	14.0	%	86.0	7.4	%	92.6	14.1	%	85.9	11.1	%	88.9
Commercial Lines	13.2		86.8	11.4		88.6	12.9		87.1	9.8		90.2
Total underwriting operations	13.8		86.2	8.1		91.9	13.9		86.1	10.9		89.1

9. DIVIDENDS

Following is a summary of our common and preferred share dividends that were declared and/or paid during the six months ended June 30, 2025 and 2024:


(millions — except per share amounts)		Amount
Declared	Payable	Per Share		Accrued/Paid 1
Common – Annual-Variable Dividends:
December 2024	January 2025	$	4.50	$	2,637
December 2023	January 2024	0.75		439

Common – Quarterly Dividends:
May 2025	July 2025	0.10		58
March 2025	April 2025	0.10		59
December 2024	January 2025	0.10		58
May 2024	July 2024	0.10		58
March 2024	April 2024	0.10		59
December 2023	January 2024	0.10		59

Preferred Dividends:
January 2024 2	February 2024	15.688377		8

1 The accrual is based on an estimate of shares outstanding as of the record date and recorded as a component of accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets until paid.

2 In February 2024, we redeemed all of our outstanding Serial Preferred Shares, Series B.

10. OTHER COMPREHENSIVE INCOME (LOSS)

The components of other comprehensive income (loss), including reclassification adjustments by income statement line item, were as follows:


							Components of Changes in Accumulated Other Comprehensive Income (after tax)
(millions)	Pretax total accumulated other comprehensive income (loss)		Total tax (provision) benefit		After tax total accumulated other comprehensive income (loss)		Total net unrealized gains (losses) on securities		Net unrealized losses on forecasted transactions		Foreign currency translation adjustment
Balance at March 31, 2025	$	( 671 )	$	147	$	( 524 )	$	( 509 )	$	( 14 )	$	( 1 )
Other comprehensive income (loss) before reclassifications:
Investment securities	558		( 117 )		441		441		0		0




Total other comprehensive income (loss) before reclassifications	558		( 117 )		441		441		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:

Net realized gains (losses) on securities	16		( 3 )		13		13		0		0
Interest expense	( 1 )		0		( 1 )		0		( 1 )		0
Total reclassification adjustment for amounts realized in net income	15		( 3 )		12		13		( 1 )		0
Total other comprehensive income (loss)	543		( 114 )		429		428		1		0
Balance at June 30, 2025	$	( 128 )	$	33	$	( 95 )	$	( 81 )	$	( 13 )	$	( 1 )


							Components of Changes in Accumulated Other Comprehensive Income (after tax)
(millions)	Pretax total accumulated other comprehensive income (loss)		Total tax (provision) benefit		After tax total accumulated other comprehensive income (loss)		Total net unrealized gains (losses) on securities		Net unrealized losses on forecasted transactions		Foreign currency translation adjustment
Balance at March 31, 2024	$	( 2,316 )	$	492	$	( 1,824 )	$	( 1,809 )	$	( 14 )	$	( 1 )


Other comprehensive income (loss) before reclassifications:
Investment securities	( 85 )		18		( 67 )		( 67 )		0		0




Total other comprehensive income (loss) before reclassifications	( 85 )		18		( 67 )		( 67 )		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:

Net realized gains (losses) on securities	( 221 )		46		( 175 )		( 175 )		0		0

Total reclassification adjustment for amounts realized in net income	( 221 )		46		( 175 )		( 175 )		0		0
Total other comprehensive income (loss)	136		( 28 )		108		108		0		0
Balance at June 30, 2024	$	( 2,180 )	$	464	$	( 1,716 )	$	( 1,701 )	$	( 14 )	$	( 1 )


							Components of Changes in Accumulated Other Comprehensive Income (after tax)
(millions)	Pretax total accumulated other comprehensive income (loss)		Total tax (provision) benefit		After tax total accumulated other comprehensive income (loss)		Total net unrealized gains (losses) on securities		Net unrealized losses on forecasted transactions		Foreign currency translation adjustment
Balance at December 31, 2024	$	( 1,809 )	$	386	$	( 1,423 )	$	( 1,408 )	$	( 14 )	$	( 1 )
Other comprehensive income (loss) before reclassifications:
Investment securities	1,666		( 350 )		1,316		1,316		0		0




Total other comprehensive income (loss) before reclassifications	1,666		( 350 )		1,316		1,316		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:

Net realized gains (losses) on securities	( 14 )		3		( 11 )		( 11 )		0		0
Interest expense	( 1 )		0		( 1 )		0		( 1 )		0
Total reclassification adjustment for amounts realized in net income	( 15 )		3		( 12 )		( 11 )		( 1 )		0
Total other comprehensive income (loss)	1,681		( 353 )		1,328		1,327		1		0
Balance at June 30, 2025	$	( 128 )	$	33	$	( 95 )	$	( 81 )	$	( 13 )	$	( 1 )

							Components of Changes in Accumulated Other Comprehensive Income (after tax)
(millions)	Pretax total accumulated other comprehensive income (loss)		Total tax (provision) benefit		After tax total accumulated other comprehensive income (loss)		Total net unrealized gains (losses) on securities		Net unrealized losses on forecasted transactions		Foreign currency translation adjustment
Balance at December 31, 2023	$	( 2,053 )	$	437	$	( 1,616 )	$	( 1,601 )	$	( 14 )	$	( 1 )


Other comprehensive income (loss) before reclassifications:
Investment securities	( 499 )		105		( 394 )		( 394 )		0		0




Total other comprehensive income (loss) before reclassifications	( 499 )		105		( 394 )		( 394 )		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:

Net realized gains (losses) on securities	( 372 )		78		( 294 )		( 294 )		0		0

Total reclassification adjustment for amounts realized in net income	( 372 )		78		( 294 )		( 294 )		0		0
Total other comprehensive income (loss)	( 127 )		27		( 100 )		( 100 )		0		0
Balance at June 30, 2024	$	( 2,180 )	$	464	$	( 1,716 )	$	( 1,701 )	$	( 14 )	$	( 1 )

In an effort to manage interest rate risk, we entered into forecasted transactions on certain of Progressive’s debt issuances. During the next 12 months, we expect to reclassify $ 1 million (pretax) into interest expense, related to net unrealized losses on forecasted transactions (see Note 4 – Debt in our 2024 Annual Report to Shareholders for further discussion).

11. LITIGATION

The Progressive Corporation and/or its insurance subsidiaries are named as defendants in various lawsuits arising out of claims made under insurance policies written by our insurance subsidiaries in the ordinary course of business. We consider all legal actions relating to such claims in establishing our loss and loss adjustment expense reserves.

In addition, The Progressive Corporation and/or its insurance subsidiaries are named as defendants in a number of class action or individual lawsuits that challenge certain of the operations of the subsidiaries. The nature and volume of litigation pending against The Progressive Corporation and/or its insurance subsidiaries is similar to that which was disclosed in Note 12 – Litigation in our 2024 Annual Report to Shareholders.

As of June 30, 2025, lawsuits have been certified or conditionally certified as class/collective actions in cases alleging that: we improperly value total loss claims by applying a negotiation adjustment in Alabama, Arkansas, Colorado, Georgia, Indiana, North Carolina, Ohio, Pennsylvania, and South Carolina; we improperly calculate basic economic loss as it relates to wage loss coverage in New York; and we improperly reduce or deny personal injury protection benefits when medical expenses are paid initially by health insurance in Arkansas. Other insurance companies face many of these same issues. We plan to contest the pending lawsuits vigorously, but may pursue settlement negotiations in some cases, as we deem appropriate.

Lawsuits arising from insurance policies and operations, including but not limited to allegations involving claims adjustment and vehicle valuation, may be filed

contemporaneously in multiple states. As of June 30,

2025, we are named as defendants in class action lawsuits

pending in multiple states alleging that we improperly

value total loss vehicle physical damage claims through the

application of a negotiation adjustment in calculating such valuations, which includes nine states in which classes have been certified, as noted above, and lawsuits styled as putative class actions pending in additional states. These lawsuits, which were filed at different times by different plaintiffs, feature certain similar claims and also include different allegations and are subject to various state laws. While we believe we have meritorious defenses and we are vigorously contesting these lawsuits, an unfavorable result in, or a settlement of, a significant number of these lawsuits could, in aggregation, have a material adverse effect on our financial condition, cash flows, and/or results of operations. Based on information available to us, we determined that losses from these lawsuits are reasonably possible but neither probable nor reasonably estimable, other than for suits for which accruals have been established and are not material, as of June 30, 2025.

With respect to our pending lawsuits that are not related to claims under insurance policies, the accruals that we have established were not material at June 30, 2025 and 2024, or December 31, 2024, and there were no material settlements during 2024 or the first six months of 2025. For most of these lawsuits, we do not consider any losses to be both probable and estimable, and we are unable to estimate a meaningful range of loss, if any, at this time, due to the factors discussed in Note 12 – Litigation in our 2024 Annual Report to Shareholders. In the event that any one or more of these lawsuits results in a substantial judgment against us, or settlement by us, or if our accruals (if any) prove to be inadequate, the resulting liability could have a material adverse effect on our consolidated financial condition, cash flows, and/or results of operations. For a further discussion on our pending litigation and related reserving policies, see Note 1 – Reporting and Accounting Policies and Note 12 – Litigation in our 2024 Annual Report to Shareholders.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.

I. OVERVIEW

The Progressive Corporation’s insurance subsidiaries recognized substantial year-over-year growth in both premiums and policies in force during the second quarter 2025, compared to the same period last year, while maintaining an underwriting profit better than our 4% companywide calendar-year underwriting profit goal.

During the second quarter 2025, we wrote $20.1 billion of net premiums written, which was $2.2 billion more than we generated during the same period last year. Companywide net premiums written and earned increased 12% and 18%, respectively, during the second quarter 2025, compared to the same period last year. Policies in force increased 15%, or by 5.0 million policies, compared to June 30, 2024; with policies in force increasing by 1.0 million in the second quarter 2025. We experienced profitable growth during the second quarter 2025, with a strong underwriting profit margin of 13.8%.

Our Personal Lines segment experienced strong year-over-year growth for the second quarter 2025, with net premiums written increasing 15% and policies in force up 16%, over the significant growth we experienced in the second quarter 2024. This growth was primarily driven by our personal auto products and reflects new and renewal application growth, which we believe is mainly attributable to increased advertising spend, competitively priced products, and our agency incentive compensation programs.

In Commercial Lines, we experienced a decrease in net premiums written of 6% during the second quarter 2025, compared to the same period last year, despite experiencing policies in force growth of 6%. The decline in net premiums written during the quarter was primarily driven by changes in the length of policy terms and related renewal timing for certain transportation network company (TNC) business policies. These policies were renewed for a 6-month term in the second quarter 2024 and subsequently renewed for a 12-month term in the fourth quarter 2024. In addition, our contractor and business auto business market targets (BMT) experienced a shift to a greater mix of policies with 6-month terms, compared to the second quarter 2024. As 12-month policies have about twice the amount of net premiums written compared to 6-month policies, the shift negatively impacted average premiums.

During the second quarter 2025, on a countrywide basis, we decreased personal auto rates less than 1% and increased our personal property rates about 4%, in the aggregate. In our core commercial auto businesses (which excludes our TNC business, our Progressive Fleet & Specialty Programs (Fleet & Specialty) products, and our business owners’ policy (BOP) product), we increased

rates in the aggregate about 3% during the second quarter 2025.

While we currently believe we are adequately priced in our personal auto products in most states, starting in the first quarter 2025, the U.S. government announced additional tariffs on goods imported into the U.S. from numerous countries, which have, in response, resulted in additional tariffs against the U.S. We regularly model the potential impact tariffs could have on vehicle loss costs, the supply chain, the availability of parts, and general inflation, among other factors, although the dynamic international trade environment currently prevents us from accurately predicting how tariffs will ultimately impact our business over time. While our focus has been on trying to maintain stable rates for customers, effective tariffs and other retaliatory actions will likely result in higher loss costs, which could result in a reduction in profitability and the possible need for higher than currently anticipated rate increases throughout 2025 and 2026. While we expect to continue increasing rates in our personal property and core commercial auto products through the remainder of 2025, we will continue to monitor the impact from tariffs and other potential changes in the regulatory environment as we evaluate the possible need for additional rate increases.

For the second quarter 2025, the $1.7 billion year-over-year increase in net income reflected an increase in both underwriting income and total net investment income, with the change in net unrealized losses on our fixed-maturity securities also contributing positively to our growth in comprehensive income.

At June 30, 2025, total capital (debt plus shareholders’ equity) was $39.5 billion, which was an increase of $7.0 billion from year-end 2024, primarily driven by the $7.1 billion of comprehensive income earned in the first half of 2025.

A. Insurance Operations

Our underwriting profit margin was 13.8% during the second quarter 2025, compared to 8.1% during the second quarter 2024. Our Personal Lines and Commercial Lines operating segments both generated strong profitability for the second quarter 2025, with margins of 14.0% and 13.2%, respectively. Underwriting profit was up significantly on a year-over-year basis, for the second quarter 2025, with our companywide loss and loss adjustment expense (LAE) ratio decreasing 6.1 points. The decrease in the loss and LAE ratio was primarily driven by a decrease in catastrophe losses in Personal Lines and by favorable prior accident years reserve development in both Personal Lines and Commercial Lines.

We closely manage our expenses, monitoring both acquisition expenses and non-acquisition expenses, which we view as an important measure of operational efficiency as we seek to deliver our most competitive rates to consumers. We will continue to advertise to maximize growth as long as the advertising spend is efficient and we remain on track to achieve our calendar-year profitability goal. During the second quarter 2025, our advertising spend was $1.2 billion, which was 35%, or 0.7 points, greater than the second quarter last year. The expense ratio impact from increased advertising spend was partially offset by a decrease in certain general expenses.

Our Personal Lines segment is comprised of our personal vehicle and property products. Personal Lines vehicles include both personal auto and special lines products, with the latter typically having higher losses during the warmer weather months, due to the seasonal nature of these products (e.g., recreational vehicles, such as motorcycles, RVs, and watercraft). Our Personal Lines underwriting margin for the second quarter 2025 was 14.0%, with personal vehicle and property products reporting 13.8% and 16.4%, respectively. The special lines profitability had minimal impact to our personal vehicle combined ratio during the second quarter 2025.

Our Commercial Lines segment includes our core commercial auto products, TNC business, Fleet & Specialty products, and BOP product. Our total Commercial Lines underwriting profitability for the second quarter 2025 was 13.2%.

For the second quarter 2025, Personal Lines generated strong net premiums written growth of 15%, with the agency and direct personal vehicle businesses and property business growing 11%, 20%, and 2%, respectively, compared to the same period last year. Commercial Lines net premiums written decreased 6%.

Changes in net premiums written are a function of new business applications (i.e., policies sold), business mix, premium per policy, and retention.

During the second quarter 2025, we experienced an increase in both total Personal Lines new and renewal business applications, primarily driven by significant increases in our personal vehicle products, due to continued increased advertising spend, our continued efforts to get back into independent agents’ quote flows, and our competitiveness in the marketplace. New and renewal personal auto applications increased 8% and 22%, respectively, during the second quarter 2025, on top of the significant growth we experienced in the same period last year.

In our personal property business, significant growth in new applications in our renters policies was offset by declines in our homeowners product, which we define as our total personal property business excluding renters and umbrella products. For the second quarter 2025, the new

business applications in our homeowners product decreased just over 50%, compared to the same period last year, with decreases in both less volatile weather-related states and in the more volatile weather-related markets (e.g., coastal and hail-prone states).

During the second quarter 2025, in our personal property business, we continued to focus on improving profitability and reducing exposure in more volatile weather-related markets, and, where permitted, on slowing growth and non-renewing policies. We prioritized insuring lower-risk properties (e.g., new construction, existing homes with newer roofs), accepting new business for our homeowners product only when bundled with a Progressive personal auto policy, where permitted, and continued to exit the non-owner-occupied home market. In addition, we maintained our cost sharing through mandatory wind and hail deductibles and roof depreciation schedules in most markets. We believe these actions adversely impacted new business application growth. We plan to continue these actions during the remainder of 2025 in the more volatile weather-related markets and will determine readiness for new business growth at the state level based on our concentration risks, product segmentation, rate adequacy, and cost sharing execution.

The total Commercial Lines net premiums written decrease during the second quarter 2025 primarily reflected changes in the renewal timing for certain TNC policies and a shift in the length of policy terms in the core commercial auto contractor and business auto BMTs, compared to the second quarter 2024, as previously discussed. Excluding the TNC business, total Commercial Lines net premiums written was down 2% on a year-over-year basis.

New and renewal business applications in our core commercial auto products increased 3% and 5%, respectively, during the second quarter 2025, compared to the same period last year. The new business application growth was primarily due to an increase in quote volume in all BMTs and improved conversion in all BMTs, other than for-hire transportation and for-hire specialty. Excluding the impact of the for-hire transportation BMT, which had a year-over-year decrease in new applications, our core commercial auto new application growth would have been 8% during the second quarter 2025. The for-hire transportation BMT continued to be adversely impacted by challenging freight market conditions that have caused a decline in the active number of motor carriers in this BMT.

During the second quarter 2025, on a year-over-year basis, average written premium per policy decreased 1% in personal auto and 6% in both our personal property and core commercial auto products. In aggregate, we took minimal personal auto rate decreases during the second quarter 2025. The decrease in personal property average written premium per policy was due to a shift in the mix of business to more renters policies, which have lower average written premiums, and our continued focus on slowing growth in more volatile weather-related markets,

which generally have higher risk and, therefore, higher average premiums per policy. These mix shifts in our personal property business were partially offset by aggregate rate increases of 14% taken over the last 12 months and higher premium coverages reflecting increased property values.

The decrease in average written premium per policy in our core commercial auto products was due to a shift in the mix of business, primarily driven by decreased demand in our for-hire transportation BMT and, to a lesser extent, the for-hire specialty BMT, as well as a shift in policy term towards more 6-month policies in our contractor and business auto BMTs. This decrease was partially offset by rate increases of about 7%, in the aggregate, over the trailing 12 months. Given that our personal property and commercial auto policies are predominately written for 12-month terms, rate actions take longer to earn into premium for these products.

We will continue to monitor the factors that could impact our loss costs for both segments, which may include tariffs, as previously discussed, new and used car prices, miles driven, driving patterns, loss severity, weather events, building materials, construction costs, inflation, and other factors, on a state-by-state basis.

We believe a key element in improving the accuracy of our personal auto rating is Snapshot ® , our usage-based insurance offering. During the second quarter 2025, the personal auto adoption rates for consumers enrolling in the program decreased 2% in agency and increased 6% in direct, compared to the same period last year. Snapshot is available in all states, other than California, and our latest segmentation model was available in states that represented 78% of our countrywide personal auto net premiums written (excluding California) on a trailing 12-month basis at quarter end. We continue to invest in our mobile application, with the majority of new enrollments choosing mobile devices for Snapshot monitoring.

We realize that to grow policies in force, it is critical that we retain our customers for longer periods. Consequently, increasing retention continues to be one of our most important priorities. Our efforts to increase our share of Progressive auto and personal property bundled households (i.e., Robinsons) remains a key initiative, and we plan to continue to make investments to improve the customer experience in order to support that goal. Policy life expectancy, which is our actuarial estimate of the average length of time that a newly written policy will remain in force before cancellation or lapse in coverage, is our primary measure of customer retention in our Personal Lines and Commercial Lines businesses.

In personal auto, we evaluate personal auto retention using a trailing 12-month and a trailing 3-month policy life expectancy. Although the latter can reflect more volatility and is more sensitive to seasonality, we believe this measure is more responsive to current experience and may

be an indicator for the future trend of our 12-month measure. Our trailing 12-month total personal auto policy life expectancy was down 5% year over year for the second quarter 2025. On a trailing 3-month basis, our personal auto policy life expectancy was down 7% for the second quarter 2025, compared to the same period last year, which we believe is due to a shift in the mix of business, increased shopping, and increased competition in the marketplace.

Our trailing 12-month policy life expectancy was down 17% for our personal property products year over year for the second quarter 2025. We believe our personal property retention decreased primarily as a result of a mix shift to more renters policies, rate increases, and the non-renewal of certain policies.

For our core commercial auto products, our trailing 12-month policy life expectancy increased 5%, compared to the prior year, which we believe is due to the moderation of our rate increases, compared to competitor rate increases, and our improving competitiveness in the marketplace. The increase in the core commercial auto policy life expectancy was across all BMTs, except in for-hire specialty and for-hire transportation, which we believe is due to various initiatives to help with improving policy life expectancy such as payment and renewal reminders.

B. Investments

The fair value of our investment portfolio was $88.6 billion at June 30, 2025, compared to $80.3 billion at December 31, 2024. The increase from year-end 2024 reflected positive cash flows from insurance operations and investment returns, partially offset by the payment of our annual variable common share dividend.

Our asset allocation strategy is to maintain 0%-25% of our portfolio in Group I securities, with the balance (75%-100%) of our portfolio in Group II securities (the securities allocated to Group I and II are defined below under Results of Operations – Investments ). At June 30, 2025 and December 31, 2024, 5% and 6%, respectively, of our portfolio was allocated to Group I securities with the remainder to Group II securities.

Our recurring investment income generated a pretax book yield of 4.2% for the second quarter 2025, compared to 3.9% for the same period in 2024. The increase from the prior year primarily reflected investing new cash from insurance operations, and proceeds from maturing bonds, in higher coupon rate securities. Our investment portfolio produced a fully taxable equivalent (FTE) total return of 2.1% and 0.9% for the second quarter 2025 and 2024, respectively. Our fixed-income and common stock portfolios had FTE total returns of 1.7% and 10.9%, respectively, for the second quarter 2025, compared to 0.8% and 3.6%, respectively, last year. The increase in the fixed-income portfolio FTE total return primarily reflected movements in U.S. Treasury yields year-over-year. The

increase in the common stock portfolio FTE total return reflected general market conditions.

At June 30, 2025 and 2024, and December 31, 2024, the fixed-income portfolio had a weighted average credit quality of AA-. At June 30, 2025, the fixed-income portfolio duration was 3.4 years, compared to 3.2 years at June 30, 2024, and 3.3 years at December 31, 2024. During 2025, we increased our duration to take advantage of higher yields in the market.

At June 30, 2025, we continued to maintain a relatively conservative investment portfolio with a greater allocation to cash and treasuries. We believe that this portfolio allocation positions us well to benefit from the continuing dynamic market environment. We believe the investment portfolio is in a very strong position as we move into the third quarter of 2025.

II. FINANCIAL CONDITION

A. Liquidity and Capital Resources

Progressive’s insurance operations create liquidity by collecting and investing premiums from new and renewal business in advance of paying claims, as well as our insurance subsidiaries producing aggregate calendar-year underwriting profits and positive cash flows. As primarily an auto insurer, our claims liabilities generally have a short-term duration.

Operations generated positive cash flows of $9.2 billion and $7.5 billion for the six months ended June 30, 2025 and 2024, respectively. The increase in operating cash flow for the first six months of 2025, compared to the same period last year, was in part driven by the growth in profit from our underwriting operations. We believe cash flows will remain positive in the foreseeable future and do not expect we will need to raise capital to support our operations in that timeframe, although changes in market or regulatory conditions affecting the insurance industry, or other unforeseen events, may necessitate otherwise.

As of June 30, 2025, we held $48.9 billion in short-term investments and U.S. Treasury securities, which represented about 55% of our total portfolio at quarter end. Based on our portfolio allocation and investment strategies, we believe that we have sufficient readily available marketable securities to cover our claim payments and short-term obligations in the event our cash flows from operations were to be negative. See Item 1A, Risk Factors in our Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission for the year ended December 31, 2024 (our 2024 Form 10-K), for a discussion of certain matters that may affect our portfolio and capital position.

Our total capital (debt plus shareholders’ equity) was $39.5 billion, based on book value, at June 30, 2025, compared to $30.2 billion at June 30, 2024, and $32.5 billion at December 31, 2024. The increase from year-end 2024, primarily reflected the comprehensive income recognized during the first six months of 2025. Our debt-to-total capital ratio was 17.5% at June 30, 2025, 22.8% at June 30, 2024, and 21.2% at December 31, 2024. Our debt-to-total capital ratios were consistent with our financial policy of maintaining a ratio of less than 30%.

None of the covenants on our existing debt securities include rating or credit triggers that would require an adjustment of interest rate or an acceleration of principal payments in the event that our debt securities are downgraded by a rating agency. In April 2025, we renewed the unsecured discretionary line of credit with PNC Bank, National Association, in the maximum principal amount of $300 million. We did not engage in short-term borrowings, including any borrowings under the line of credit, to fund our operations or for liquidity purposes during the reported periods.

We seek to deploy capital in a prudent manner and use multiple data sources and modeling tools to estimate the frequency, severity, and correlation of identified exposures, including, but not limited to, catastrophic and other insured losses, natural disasters, and other significant business interruptions, to estimate our potential capital needs.

During the first six months of 2025, we returned capital to shareholders primarily through common share dividends and common share repurchases. Our Board of Directors declared a $0.10 per common share dividend in both the first and second quarters of 2025. These dividends, which were $59 million and $58 million, respectively, in the aggregate, were paid in April 2025 and July 2025. In January 2025, we also paid common share dividends declared in the fourth quarter 2024, in the aggregate amount of $2.7 billion, or $4.60 per share (see Note 9 – Dividends for further discussion).

Pursuant to our financial policies, we repurchase common shares to neutralize dilution from equity-based compensation granted during the year and opportunistically when we believe our shares are trading below our determination of long-term fair value. During the first six months of 2025, we repurchased 0.3 million common shares, at a total cost of $67 million, including 0.1 million shares in the second quarter 2025, both in the open market and to satisfy tax withholding obligations in connection with the vesting of equity awards under our employee equity compensation plans. We will continue to make decisions on returning capital to shareholders based on the strength of our overall capital position, the capital strength of our subsidiaries, and the potential capital needs of our business.

At June 30, 2025, we had $5.0 billion in a consolidated, non-insurance subsidiary of the holding company that can be used to fund corporate obligations and provide additional capital to the insurance subsidiaries to fund potential future growth and other opportunities. As of June 30, 2025, our estimated consolidated statutory surplus was $31.1 billion.

During the first six months of 2025, our contractual obligations and critical accounting policies have not changed materially from those discussed in our 2024 Annual Report to Shareholders. There have not been any material changes in off-balance-sheet leverage, which includes purchase obligations, from those discussed in our 2024 Annual Report to Shareholders.

On July 4, 2025, H.R. 1, “An Act to provide for reconciliation pursuant to title II of H. Con. Res. 14” (the Act) was signed into law by the President of the United

States. The Act contains numerous tax provisions applicable to corporations. We are in the process of evaluating the provisions applicable to Progressive and, while this assessment is not yet complete, we do not currently expect the Act will have a material effect on our financial condition or results of operations.

Since Florida insurance reform was enacted in early 2023, we have seen lower loss costs on certain types of personal auto accident claims and favorable reserve development, and we have experienced strong profitability in our Florida personal auto business. In response to these trends, we have lowered Florida personal auto rates twice in the last year. Despite these actions, it is possible that our profit for personal auto in Florida for the 2023 to 2025 period will exceed the statutory profit limit that a Florida statute imposes on the profit that any insurance group can earn on personal auto insurance over any three-calendar-year period and that we will need to pay any profit above

the limit to all Florida personal auto policyholders active at December 31, 2025. We are not currently able to determine whether we will exceed the permitted profit limit because several factors can impact the determination. The Atlantic hurricane season continues through late November 2025, and the risk of hurricanes impacting Florida through that time is relatively high. In addition, any reserve development through the first quarter 2026 on losses for accident years 2023 through 2025 will impact the statutory calculations. Finally, other factors described in Item 1A, Risk Factors in our 2024 Form 10-K that may impact our ability to establish accurate loss reserves could impact these determinations. We expect to be able to reasonably estimate any potential exposure by the end of the fourth quarter 2025, and to pay amounts owed, if any, during late 2025 or 2026.

Based upon our capital planning and forecasting efforts, we believe we have sufficient capital resources and cash flows from operations to support our current business, scheduled principal and interest payments on our debt, anticipated quarterly dividends on our common shares, our contractual obligations, and other expected capital requirements for the foreseeable future.

Nevertheless, we may decide to raise additional capital to take advantage of attractive terms in the market and provide additional financial flexibility. We currently have an effective shelf registration with the U.S. Securities and Exchange Commission so that we may periodically offer and sell an indeterminate aggregate amount of senior or subordinated debt securities, preferred stock, depository shares, common stock, purchase contracts, warrants, and units. The shelf registration enables us to raise funds, subject to market conditions, from the offering of any securities covered by the shelf registration as well as any combination thereof.

III. RESULTS OF OPERATIONS – UNDERWRITING

A. Segment Overview

We report our underwriting operations in two segments: Personal Lines and Commercial Lines. Our Personal Lines segment writes insurance for personal vehicles, which include personal auto and special lines products (e.g., recreational vehicles, such as motorcycles, RVs, and watercraft), personal residential property insurance for homeowners and renters, umbrella insurance, and flood insurance through the “Write Your Own” program for the National Flood Insurance Program. Since our personal auto products represented about 90% of our Personal Lines segment net premiums written at quarter end, much of the following discussion will focus on our personal auto products, both in total and by distribution channel. We will also discuss our personal property products as we continue to focus on improving profitability and reducing our concentration and exposure in more volatile weather-related markets.

Our Commercial Lines segment writes auto-related liability and physical damage insurance, business-related general liability and commercial property insurance predominantly for small businesses, and workers’ compensation insurance primarily for the transportation industry and includes our core commercial auto products, TNC business, Fleet & Specialty products, and BOP product. Of our total Commercial Lines segment, our core commercial auto products represented about 80% of net premiums written and our TNC business represented about 15%, both on a trailing 12-month basis, as of the end of the second quarter 2025. Therefore, much of the following discussion focuses only on our core commercial auto products.

The following table shows the composition of our companywide net premiums written, by segment, for the respective periods:


	Three Months Ended June 30,				Six Months Ended June 30,
	2025		2024		2025		2024
Personal Lines
Vehicles
Agency	37	%	37	%	35	%	36	%
Direct	47		44		46		43
Property	4		5		4		4
Total Personal Lines	88		86		85		83
Commercial Lines	12		14		15		17
Total underwriting operations	100	%	100	%	100	%	100	%

Within our Personal Lines segment, we often categorize our personal auto product policyholders into four consumer segments:

• Sam - inconsistently insured;

• Diane - consistently insured and maybe a renter;

• Wrights - homeowners who do not bundle auto and home; and

• Robinsons - homeowners who bundle auto and home.

While our personal auto policies primarily have 6-month terms, to promote bundled personal auto and property growth, we write 12-month personal auto policies in our Platinum agencies. At June 30, 2025 and 2024, 11% and

13%, respectively, of our agency personal auto policies in force were 12-month policies. To the extent our agency application mix of annual personal auto policies changes, the shift in policy term could impact our average premiums in the agency channel, as 12-month policies have about twice the amount of net premiums written compared to 6-month policies.

Our special lines and personal property products are written for 12-month terms. About 55% and 70%, respectively, of our special lines products and personal property business net premiums written during the second quarter 2025 was generated through the independent agency channel, with the balance through the direct channel.

Within our Commercial Lines segment, our core commercial auto business operates in the following five traditional business market targets (BMT):

• for-hire specialty;

• for-hire transportation;

• tow;

• contractor; and

• business auto.

At June 30, 2025, about 85% of Commercial Lines policies in force had 12-month terms. The majority of our Commercial Lines business is written through the independent agency channel, although we continue to focus on growing our direct business, with about 10% of our core commercial auto premiums written through the direct channel.

B. Profitability

Profitability for our underwriting operations is defined by pretax underwriting profit or loss, which is calculated as net premiums earned plus fees and other revenues less losses and loss adjustment expenses, policy acquisition costs, and other underwriting expenses. We also use underwriting margin, which is underwriting profit or loss expressed as a percentage of net premiums earned, to analyze our results. For the respective periods, our underwriting profitability results were as follows:


	Three Months Ended June 30,								Six Months Ended June 30,
	2025				2024				2025				2024
	Underwriting Profit (Loss)				Underwriting Profit (Loss)				Underwriting Profit (Loss)				Underwriting Profit (Loss)
($ in millions)	$		Margin		$		Margin		$		Margin		$		Margin
Personal Lines
Vehicles
Agency	$	1,135	15.6	%	$	788	12.7	%	$	2,406	16.8	%	$	1,739	14.4	%
Direct	1,185		12.5		783		10.3		2,198		12.0		1,826		12.5
Property	128		16.4		(488)		(66.3)		227		14.6		(441)		(30.4)
Total Personal Lines	2,448		14.0		1,083		7.4		4,831		14.1		3,124		11.1
Commercial Lines	364		13.2		304		11.4		702		12.9		513		9.8
Other indemnity 1	(4)		NM		(1)		NM		(8)		NM		(1)		NM
Total underwriting operations	$	2,808	13.8	%	$	1,386	8.1	%	$	5,525	13.9	%	$	3,636	10.9	%

1 Underwriting margins for our other indemnity businesses are not meaningful (NM) due to the low level of premiums earned by, and the variability of loss costs in, such businesses.

The increase in our underwriting profit margin on a year-over-year basis for the second quarter 2025 was due to a decrease in our companywide loss and LAE ratio of 6.1 points. On a year-to-date basis, the loss and LAE ratio decreased 4.1 points.

The decrease in the loss and LAE ratio during the second quarter 2025 was primarily driven by a decrease in catastrophe losses in Personal Lines and by favorable prior accident years reserve development in both Personal Lines and Commercial Lines.

During the second quarter 2025, our advertising spend was $1.2 billion, which was 35%, or 0.7 points, greater than the

second quarter last year, and $2.5 billion during the first half of 2025, which was 57%, or 1.5 points, greater than the same period last year. The expense ratio impact from increased advertising spend was partially offset by a decrease in non-acquisition expenses.

See the Losses and Loss Adjustment Expenses (LAE) section below for further discussion of our catastrophe losses, auto frequency and severity trends, and reserve development recognized during the periods and the Underwriting Expenses section for further discussion of our advertising and non-acquisition expenses.

Further underwriting results for our Personal Lines business, Commercial Lines business, and our underwriting operations in total, were as follows:


	Three Months Ended June 30,			Six Months Ended June 30,
Underwriting Performance 1	2025	2024	Change	2025	2024	Change
Personal Lines
Vehicles
Agency
Loss & loss adjustment expense ratio	66.2	69.2	(3.0)	65.1	67.6	(2.5)
Underwriting expense ratio	18.2	18.1	0.1	18.1	18.0	0.1
Combined ratio	84.4	87.3	(2.9)	83.2	85.6	(2.4)
Direct
Loss & loss adjustment expense ratio	68.3	71.0	(2.7)	67.7	69.5	(1.8)
Underwriting expense ratio	19.2	18.7	0.5	20.3	18.0	2.3
Combined ratio	87.5	89.7	(2.2)	88.0	87.5	0.5
Property
Loss & loss adjustment expense ratio	54.4	137.4	(83.0)	56.4	101.6	(45.2)
Underwriting expense ratio	29.2	28.9	0.3	29.0	28.8	0.2
Combined ratio	83.6	166.3	(82.7)	85.4	130.4	(45.0)
Total Personal Lines
Loss & loss adjustment expense ratio	66.8	73.6	(6.8)	66.2	70.4	(4.2)
Underwriting expense ratio	19.2	19.0	0.2	19.7	18.5	1.2
Combined ratio	86.0	92.6	(6.6)	85.9	88.9	(3.0)
Commercial Lines
Loss & loss adjustment expense ratio	66.8	69.6	(2.8)	67.2	71.0	(3.8)
Underwriting expense ratio	20.0	19.0	1.0	19.9	19.2	0.7
Combined ratio	86.8	88.6	(1.8)	87.1	90.2	(3.1)
Total Underwriting Operations
Loss & loss adjustment expense ratio	66.8	72.9	(6.1)	66.3	70.4	(4.1)
Underwriting expense ratio	19.4	19.0	0.4	19.8	18.7	1.1
Combined ratio	86.2	91.9	(5.7)	86.1	89.1	(3.0)
Accident year – Loss & loss adjustment expense ratio 2	68.4	73.2	(4.8)	67.8	70.6	(2.8)

1 Ratios are expressed as a percentage of net premiums earned. Fees and other revenues are netted against either loss adjustment expenses or underwriting expenses in the ratio calculations, based on the underlying activity that generated the revenue.

2 The accident year ratios include only the losses that occurred during the period noted. As a result, accident period results will change over time, either favorably or unfavorably, as we revise our estimates of loss costs when payments are made or reserves for that accident period are reviewed.

Losses and Loss Adjustment Expenses (LAE)


	Three Months Ended June 30,				Six Months Ended June 30,
(millions)	2025		2024		2025		2024
Change in net loss and LAE reserves	$	1,565	$	1,911	$	2,684	$	2,490
Paid losses and LAE	12,040		10,684		23,725		21,077
Total incurred losses and LAE	$	13,605	$	12,595	$	26,409	$	23,567

Claims costs, our most significant expense, represent payments made, and estimated future payments to be made, to or on behalf of our policyholders, including expenses needed to adjust or settle claims. Claims costs are a function of loss severity and frequency and, for our personal auto and core commercial auto businesses, are influenced by inflation and driving patterns, among other factors, some of which are discussed below. In our personal property business, severity is primarily a function of construction costs and the age and complexity of the structure, among other factors. Accordingly, anticipated changes in these factors are taken into account when we establish premium rates and loss reserves. Loss reserves

are estimates of future costs and our reserves are adjusted as underlying assumptions change and information develops.

Our total loss and LAE ratio decreased 6.1 points and 4.1 points, for the three and six month periods ended June 30, 2025, respectively, compared to the prior year periods, primarily due to a decrease in catastrophe losses and to favorable prior accident years reserve development. On an accident year basis, our loss and LAE ratio was 4.8 points and 2.8 points lower for the second quarter and first half of 2025, respectively, compared to the same periods last year.

The following table shows our consolidated catastrophe losses and related combined ratio point impact, excluding loss adjustment expenses, incurred during the periods:


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024
($ in millions)	$		Point 1	$		Point 1	$		Point 1	$		Point 1
Personal Lines
Vehicles	$	531	3.2	$	687	5.0	$	831	2.5	$	887	3.3
Property	157		20.2	556		75.6	311		20.0	694		47.9
Total Personal Lines	688		3.9	1,243		8.5	1,142		3.3	1,581		5.6
Commercial Lines	19		0.7	26		1.0	24		0.4	35		0.7
Total net catastrophe losses incurred	$	707	3.5	$	1,269	7.4	$	1,166	2.9	$	1,616	4.8

1 Represents catastrophe losses incurred during the period, including the impact of reinsurance, as a percent of net premiums earned for each segment.

In the second quarter 2025, our catastrophe losses reflected severe weather events throughout the United States, with Texas accounting for about one third of the losses. We have responded, and plan to continue to respond, promptly to catastrophic events when they occur in order to provide high-quality claims service to our customers.

Changes in our estimate of our ultimate losses on catastrophes currently reserved, along with potential future catastrophes, could have a material impact on our financial condition, cash flows, or results of operations. We reinsure various risks including, but not limited to, catastrophic losses. We do not have catastrophe-specific reinsurance for our personal auto, special lines, or core commercial auto businesses. For the personal property business and certain BOP product coverages, reinsurance programs include catastrophe per occurrence excess of loss contracts and aggregate excess of loss contracts. We also purchase excess of loss reinsurance on our workers’ compensation insurance and our higher-limit commercial auto liability product offered by our Fleet & Specialty business, and on certain BOP product coverages.

We evaluate our reinsurance programs during the renewal process, if not more frequently, to ensure our programs continue to effectively address the company’s risk tolerance. During the second quarter 2025, we entered into new reinsurance contracts under our per occurrence excess of loss program for our personal property business. This reinsurance program has a retention threshold for losses and allocated loss adjustment expenses (ALAE) from a single catastrophic event of $200 million for a storm outside of Florida and $75 million for a storm in Florida. In general, our program includes coverage for $2.0 billion in losses and ALAE with additional substantial coverage for a second or third hurricane. When considering coverage specific to Florida, including the Florida Hurricane Catastrophe Fund, this coverage reaches an estimated $2.2 billion.

For 2025, we also entered into a new catastrophe aggregate excess of loss reinsurance contract for claims occurring in 2025 that has multiple layers of coverage. The first retention layer threshold ranges from $450 million to $475 million, excluding named tropical storms and hurricanes,

and the second retention layer threshold is $525 million, including named tropical storms and hurricanes. The first and second layers provide coverage up to $75 million and $100 million, respectively. As part of the 2025 aggregate excess of loss program, we also entered into a severe convective storm parametric loss aggregate coverage, which covers a type of thunderstorm characterized by strong winds, heavy rain, large hail, thunder, lightning, and sometimes tornadoes. This parametric loss coverage provides $15 million of coverage, net of a retention of $665 million.

While the total coverage limit and per-event retention will evolve to fit the growth of our business, we expect to remain a consistent purchaser of reinsurance coverage. While the availability of reinsurance is subject to many forces outside of our control, the types of reinsurance that we elected to purchase during the first half of 2025 were readily available and competitively priced. On a year-over-year basis, we did not incur a material change in the aggregate costs of our reinsurance programs. See Item 1A, Risk Factors in our 2024 Form 10-K for a discussion of certain risks related to catastrophe events. See Item 1, Business – Reinsurance in our 2024 Form 10-K for a discussion of our various reinsurance programs.

The following discussion of our severity and frequency trends in our personal auto business excludes comprehensive coverage because of its inherent volatility, as it is typically linked to catastrophic losses generally resulting from adverse weather. For our core commercial auto business, the reported frequency and severity trends include comprehensive coverage. Comprehensive coverage insures against damage to a customer’s vehicle due to various causes other than collision, such as windstorm, hail, theft, falling objects, and glass breakage.

On a calendar-year basis, the change in total personal auto incurred severity (i.e., average cost per claim, including both paid losses and the change in case reserves) over the prior-year period, was as follows:


	Quarter	Year-to-date
Coverage Type	2025	2025
Bodily injury	12%	10%
Collision	1	3
Personal injury protection	(3)	(6)
Property damage	4	3
Total	6	5

The year-over-year increase in total severity was predominantly driven by increased bodily injury coverage reserves, compared to the same periods last year, due to higher medical costs and a higher rate of litigated injury claims.

To address inherent seasonality trends and lessen the effects of month-to-month variability in the commercial auto products, we use a trailing 12-month period in assessing severity. Since the loss patterns in the core commercial auto products are not indicative of our other commercial auto products (i.e., TNC and Fleet & Specialty businesses), disclosing severity and frequency trends excluding those businesses is more representative of our overall experience for the majority of our commercial products. As of the end of the second quarter 2025, our core commercial auto products’ trailing 12-month incurred severity increased 7%, compared to the same period last year, in part, due to increased medical costs.

It is a challenge to estimate future severity, but we continue to monitor changes in the underlying costs, such as tariffs, general inflation, used car prices, vehicle repair costs, medical costs, health care reform, court decisions, and jury verdicts, along with regulatory changes and other factors that may affect severity.

The change in total personal auto incurred frequency, on a calendar-year basis, over the prior-year period, was as follows:


	Quarter	Year-to-date
Coverage Type	2025	2025
Bodily injury	(1)%	0%
Collision	(6)	(6)
Personal injury protection	(3)	(2)
Property damage	(3)	(2)
Total	(4)	(3)

The year-over-year decrease in frequency, in part, reflects a shift in the mix of business to a more preferred tier of customers (i.e., Wrights and Robinsons) and lower vehicle miles traveled during the first half of 2025, compared to the same periods last year.

On a trailing 12-month basis, our core commercial auto products’ incurred frequency decreased 8% through the second quarter 2025, we believe, in part, due to a shift in the mix of business and lower vehicle miles traveled compared to the same period last year.

We closely monitor changes in frequency, but the degree or direction of near-term frequency change is not something that we are able to predict with any certainty. We will continue to analyze trends to distinguish changes in our experience from other external factors, such as changes in the number of vehicles per household, miles driven, vehicle usage, gasoline prices, advances in vehicle safety, and unemployment rates, versus those resulting from shifts in the mix of our business, changes in driving patterns, and the ridesharing economy, to allow us to react quickly to price for these trends and to reserve more accurately for our loss exposures.

The table below presents the actuarial adjustments implemented and the loss reserve development experienced on a companywide basis in the following periods:


	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2025			2024			2025			2024
Actuarial Adjustments
Reserve decrease (increase)
Prior accident years	$	73		$	(55)		$	98		$	(119)
Current accident year	40			(17)			54			16
Calendar-year actuarial adjustments	$	113		$	(72)		$	152		$	(103)
Prior Accident Years Development
Favorable (unfavorable)
Actuarial adjustments	$	73		$	(55)		$	98		$	(119)
All other development	256			107			509			182
Total development	$	329		$	52		$	607		$	63
(Increase) decrease to calendar-year combined ratio	1.6		pts.	0.3		pts.	1.5		pts.	0.2		pts.

Total development consists of both actuarial adjustments and “all other development” on prior accident years. We use “accident year” generically to represent the year in which a loss occurred. The actuarial adjustments represent the net changes made by our actuarial staff to both current and prior accident year reserves based on regularly scheduled reviews. Through these reviews, our actuaries identify and measure variances in the projected frequency and severity trends, which allow them to adjust the reserves to reflect current cost trends.

For the Personal Lines vehicle products and the Commercial Lines business, development for catastrophe losses would be reflected in “all other development,” discussed below, to the extent they relate to prior year reserves. For our Personal Lines property business, 100% of catastrophe losses are reviewed monthly, and any development on catastrophe reserves are included as part of the actuarial adjustments. We report these actuarial adjustments separately for the current and prior accident years to reflect these adjustments as part of the total prior accident years development.

“All other development” represents claims settling for more or less than reserved, emergence of unrecorded claims at rates different than anticipated in our incurred but not recorded (IBNR) reserves, and changes in reserve estimates on specific claims. Although we believe the development from both the actuarial adjustments and “all other development” generally results from the same factors, we are unable to quantify the portion of the reserve development that might be applicable to any one or more of those underlying factors.

Our objective is to establish case and IBNR reserves that are adequate to cover all loss costs, while incurring minimal variation from the date the reserves are initially established until losses are fully developed. Our ability to meet this objective is impacted by many factors, such as the factors impacting severity estimates described above and storms occurring close to quarter end.

As reflected in the table above, we experienced favorable prior accident years development during the first six months of 2025 and 2024. The favorable development during the first six months of 2025 was, in part, due to lower than anticipated severity and frequency in Florida and lower litigation defense costs across most states in the personal auto business.

See Note 6 – Loss and Loss Adjustment Expense Reserve s to the consolidated financial statements for a more detailed discussion of our prior accident years reserve development and Critical Accounting Policies in our 2024 Annual Report to Shareholders for discussion of the application of estimates and assumptions in the establishment of our loss reserves.

Underwriting Expenses

Underwriting expenses include policy acquisition costs and other underwriting expenses. The underwriting expense ratio is our underwriting expenses, net of certain fees and other revenues, expressed as a percentage of net premiums earned. For the second quarter and first half of 2025, our underwriting expense ratio was up 0.4 points and 1.1 points, respectively, compared to the same periods last year. Both increases were primarily attributable to the increase in our advertising spend. In total, our companywide advertising spend increased 35%, or 0.7 points, in the second quarter, and 57% or 1.5 points, for the first six months of 2025, compared to the same periods last year.

Our total advertising spend for the first half of 2025, was $2.5 billion, compared to $1.6 billion in the first half of 2024. We invested heavily during the first half of the year to capture consumer shopping, and will continue to advertise to maximize growth, as long as we remain on track to achieve our profitability goal and can acquire customers at or below our target acquisition cost.

To analyze underwriting expenses, we also review our non-acquisition expense ratio (NAER), which excludes costs related to policy acquisition (e.g., advertising and agency

commissions) from our underwriting expense ratio. By excluding acquisition costs from our underwriting expense ratio, we are able to understand costs other than those necessary to acquire new policies and grow the business. During the second quarter 2025, our NAER decreased 0.4 points in our personal vehicle business and increased 0.9 points and 0.5 points in our personal property and core

commercial auto businesses, respectively, compared to the same period last year. On a year-to-date basis, our NAER decreased 0.3 points in our personal vehicle business, and increased 1.1 points and 0.4 points in our personal property and core commercial auto businesses, respectively. We remain committed to efficiently managing operational non-acquisition expenses.

C. Growth

For our underwriting operations, we analyze growth in terms of both premiums and policies. Net premiums written represent the premiums from policies written during the period, less any premiums ceded to reinsurers. Net premiums earned, which are a function of the premiums written in the current and prior periods, are earned as revenue over the life of the policy using a daily earnings convention. Policies in force, our preferred measure of growth since it removes the variability due to rate changes or mix shifts, represents all policies for which coverage was in effect as of the end of the period specified.


	Three Months Ended June 30,						Six Months Ended June 30,
($ in millions)	2025		2024		% Growth		2025		2024		% Growth
Net Premiums Written
Personal Lines
Vehicles
Agency	$	7,481	$	6,734	11	%	$	14,954	$	13,133	14	%
Direct	9,387		7,828		20		19,454		15,910		22
Property	845		831		2		1,578		1,564		1
Total Personal Lines	17,713		15,393		15		35,986		30,607		18
Commercial Lines	2,363		2,508		(6)		6,296		6,256		1
Other indemnity 1	0		1		NM		0		1		NM
Total underwriting operations	$	20,076	$	17,902	12	%	$	42,282	$	36,864	15	%
Net Premiums Earned
Personal Lines
Vehicles
Agency	$	7,302	$	6,213	18	%	$	14,328	$	12,071	19	%
Direct	9,466		7,596		25		18,374		14,616		26
Property	776		736		5		1,552		1,449		7
Total Personal Lines	17,544		14,545		21		34,254		28,136		22
Commercial Lines	2,765		2,664		4		5,464		5,222		5
Other indemnity 1	1		0		NM		1		0		NM
Total underwriting operations	$	20,310	$	17,209	18	%	$	39,719	$	33,358	19	%
NM = Not meaningful
1 Includes other underwriting business and run-off operations.

							June 30,
(# in thousands)							2025		2024		% Growth
Policies in Force
Personal Lines
Agency - auto							10,423		8,965		16	%
Direct - auto							15,245		12,576		21
Special lines							6,850		6,312		9
Property							3,608		3,339		8
Total Personal Lines							36,126		31,192		16
Commercial Lines							1,189		1,118		6
Companywide total							37,315		32,310		15	%

To analyze growth, we review new policies, rate levels, and the retention characteristics of our segments. Although new policies are necessary to maintain a growing book of business, we recognize the importance of retaining our current customers as a critical component of our continued growth.

D. Personal Lines

Our Personal Lines business offers vehicle (personal auto and special lines) and residential property insurance products to personal consumers, with the operating goal of optimizing the number of insured products within our policyholders’ households. In our discussion below, we report our personal auto and personal property business results separately as components of our Personal Lines segment to provide a further understanding of our products. Our personal auto business discussions are further separated between the agency and direct distribution channels. For the three months ended June 30, 2025, 44% of our personal auto business was written through the agency channel and 56% was written through the direct channel. While consumer segment results varied by channel, as discussed below, our total personal auto business experienced overall growth in policies in force, new business applications, quotes, and conversion during the second quarter and first half of 2025, compared to the same periods last year.

Personal Auto - Agency

The year-over-year changes in our personal auto agency business were as follows:


	Change Over Prior Year
	Quarter				Year-to-date
	2025		2024		2025		2024
Applications
New	6	%	13	%	17	%	(1)	%
Renewal	19		9		18		8
Total	16		9		18		6
Written premium per policy
New	(6)		6		(5)		5
Renewal	(3)		14		(2)		16
Total	(3)		12		(2)		13
Policy life expectancy
Trailing 3 months	(6)		3
Trailing 12 months	(4)		18

The personal auto agency business includes business written by more than 40,000 independent insurance agencies that represent Progressive, as well as brokerages in New York and California. During the second quarter 2025, we generated new agency personal auto application growth in 32 states and the District of Columbia, including seven of our top 10 largest agency states.

Compared to the same periods in the prior year, new applications increased 6% during the second quarter 2025, primarily driven by significant growth for Sams and Dianes, which more than offset a decrease in new

applications for Robinsons, while Wrights experienced flat growth. For the first six months of 2025, all consumer segments experienced an increase in new application growth, except for Robinsons who experienced a decline. All consumer segments saw an increase in policies in force at the end of the second quarter 2025, compared to the same period last year.

During the second quarter and first six months of 2025, on a year-over-year basis, we experienced an increase in agency auto quote volume of 7% and 12%, respectively, with a rate of conversion (i.e., converting a quote to a sale) decrease of 2% for the quarter and an increase of 4% on a year-to-date basis, compared to the same periods last year. For both the second quarter and first six months of 2025, all consumer segments experienced an increase in quote volume, compared to the same periods in the prior year, except Robinsons, who decreased substantially. Both Sams and Dianes experienced an increase in conversion during the second quarter and first half of 2025, with Wrights and Robinsons experiencing a decrease, compared to the same periods last year.

The increase in new applications, quotes, and conversion for Sams were, in part, driven by lifting certain underwriting restrictions that were in place at the beginning of 2024. The decline in new applications, quotes, and conversion for Robinsons, compared to the prior year periods, was due to several initiatives implemented in our personal property business that were focused on improving profitability, as discussed in the Personal Property section below. These initiatives, which began during the last half of 2024, focused primarily on home and condo coverages and impacted growth in bundled auto and homeowner policies.

Our personal auto rates were relatively stable during the quarter. The decrease in written premium per policy for new and renewal personal auto agency business during the second quarter and first six months of 2025, compared to the same periods last year, was, in part, attributable to rate decreases in certain markets, including Florida, and a shift in the mix of business, including a shift to a higher percentage of 6-month policies, which have about half of the amount of net premiums written as policies with 12-month terms.

Our trailing 3- and 12-month policy life expectancy in the agency auto business experienced a decrease at the end of the second quarter 2025, on a year-over-year basis, which we believe is primarily driven by a shift in the mix of business to more Sams and increased consumer shopping.

Personal Auto - Direct

The year-over-year changes in our personal auto direct business were as follows:


	Change Over Prior Year
	Quarter				Year-to-date
	2025		2024		2025		2024
Applications
New	9	%	50	%	21	%	17	%
Renewal	25		8		23		10
Total	21		17		22		12
Written premium per policy
New	3		10		3		9
Renewal	1		12		1		13
Total	1		10		1		12
Policy life expectancy
Trailing 3 months	(8)		(10)
Trailing 12 months	(6)		2

The personal auto direct business includes business written directly by Progressive online or by phone. During the second quarter 2025, we generated new direct personal auto application growth in 39 states and the District of Columbia, including seven of our top 10 largest direct states. Compared to the same periods in the prior year, all four consumer segments experienced moderate growth in new applications, except Sams, who experienced significant growth for the second quarter 2025, with all four consumer segments experiencing significant growth for the first half of 2025. Policies in force grew between 17% and 24% in each consumer segment, compared to the same period last year.

During the second quarter and first six months of 2025, direct personal auto quote volume increased 2% and 12%, respectively, with a rate of conversion increase of 6% and 7%, compared to the same periods last year, primarily driven by increased advertising spend and our competitiveness in the marketplace. For the second quarter 2025, Sams and Robinsons experienced quote volume growth higher than the total, Dianes experienced flat growth, and the Wrights experienced a decline, compared to the same period last year. All consumer segments experienced quote volume growth for the first half of 2025. For the second quarter and first half of 2025, all consumer segments experienced an increase in conversion, except for Robinsons, who experienced a slight decline.

The personal property profitability initiatives that negatively affected Robinsons new application, quote, and conversion growth in the agency channel were not as impactful to the direct channel as the majority of the property business bundles with personal auto in the direct channel is written through unaffiliated third-party carriers, which remain available even when we restrict writing our personal property products.

Our personal auto rates were relatively stable during the quarter, resulting in relatively steady written premium per

policy during the second quarter and first six months of 2025, compared to the same periods last year.

Our trailing 3- and 12-month policy life expectancy in the direct auto business experienced a decrease at the end of the second quarter 2025, on a year-over-year basis, which we believe is primarily driven by a shift in the mix of business and increased consumer shopping.

Personal Property

The year-over-year changes in our personal property business were as follows:


	Change Over Prior Year
	Quarter				Year-to-date
	2025		2024		2025		2024
Applications
New	(11)	%	35	%	(6)	%	33	%
Renewal	14		6		13		7
Total	4		16		6		15
Written premium per policy
New	(33)		(10)		(37)		(5)
Renewal	(3)		2		(3)		4
Total	(6)		(4)		(7)		(1)
Policy life expectancy Trailing 12 months	(17)		5

Our personal property business writes residential property insurance for homeowners and renters, umbrella, and flood insurance through the “Write Your Own” program for the National Flood Insurance Program. Our personal property business insurance is written in the agency and direct channels.

In addition to reducing our geographic footprint in more volatile weather-related markets (e.g., coastal and hail-prone states), we continued to focus on achieving profitability goals in markets that are less susceptible to catastrophes for our homeowners product, which we define as our total personal property business excluding renters and umbrella products. In the growth-oriented states, homeowners product policies in force increased 7% on a year-over-year basis as of June 30, 2025. Policies in force decreased 15% in the volatile weather states as of the end of the second quarter 2025, compared to the same period in the prior year.

We believe actions taken to address profitability adversely impacted new business application growth. During the first half of 2025, we continued several initiatives, including: (i) prioritizing insuring lower-risk properties (e.g., new construction, existing homes with newer roofs); (ii) having underwriting restrictions in place in most states, to only accept new homeowners product business when the property policy is bundled with a Progressive personal auto policy, where permitted; (iii) restricting new business and non-renewing policies that provide coverage for non-owner-occupied properties (e.g., short-term vacation rental, secondary residence, etc.) in the majority of states; and, (iv) expanding our cost sharing with policyholders through

mandatory wind and hail deductibles and roof depreciation schedules in markets where permitted.

In addition, beginning in the second quarter 2024, following the required filings and notices, we began our efforts to non-renew about 115,000 property policies in Florida. This effort slowed while the moratoriums were in place in response to Hurricanes Helene and Milton, which temporarily limited an insurer’s ability to non-renew policies, but resumed once the moratoriums expired in December 2024. This effort was substantially completed by the end of the second quarter 2025.

Our written premium per policy decreased on a year-over-year basis for the second quarter and first six months of 2025, primarily attributable to a shift in the mix of business to more renters policies, which have lower average written premiums, and a decline in homeowners policies in force in both volatile weather-related markets and non-owner-occupied properties, which both have higher average premiums. The effect of these declines were partially offset by rate increases taken during the last 12 months and higher premium coverages reflecting increased property values. During the second quarter 2025, we increased rates, in aggregate, about 4% in our personal property business, bringing the year-to-date aggregate rate increase to 6%. We intend to continue to make targeted rate increases in states where we are not achieving our profitability goals.

The policy life expectancy in our personal property business shortened during the second quarter 2025, compared to the same period last year, which we believe is primarily driven by a shift in the mix of business to more renters policies, the non-renewals for certain policies in volatile weather states, and rate increases made during the last 12 months.

E. Commercial Lines

The following table and discussion focuses on our core commercial auto products, which accounted for about 80% of our Commercial Lines segment net premiums written on a trailing 12-month basis, as of the end of the second quarter 2025. Year-over-year changes in our core commercial auto products were as follows:


	Change Over Prior Year
	Quarter				Year-to-date
	2025		2024		2025		2024
Applications
New	3	%	7	%	6	%	4	%
Renewal	5		1		5		1
Total	5		4		5		2
Written premium per policy
New	(7)		1		(7)		2
Renewal	(6)		13		(5)		13
Total	(6)		8		(6)		9
Policy life expectancy Trailing 12 months	5		(19)

During the second quarter and first six months of 2025 on a year-over-year basis, core commercial auto new application growth was positive in our tow, contractor, and business auto BMTs. The for-hire transportation BMT continued to be adversely impacted by challenging freight market conditions that have continued to cause a decline in the active number of motor carriers in this BMT. Policies in force grew in all of our BMTs, except in the for-hire transportation and for-hire specialty BMTs. During the second quarter and first six months of 2025, quote volume increased about 4% and 3%, respectively, while conversion decreased 1% and increased 2%, in our core commercial auto products, compared to the same periods last year.

The effect the previously discussed rate increases had on written premium per policy for our core commercial auto business was offset by a shift in the mix of business, primarily driven by a decreased demand for products in our for-hire transportation BMT and, to a lesser extent, our for-hire specialty BMT. Written premium per policy was also impacted by a shift to a greater mix of policies with 6-month terms in our contractor and business auto BMTs, which have about half the amount of net premiums written as 12-month policies. During the second quarter 2025, we increased rates, in aggregate, about 3% in our core commercial auto products, bringing the year-to-date aggregate rate increase to 4%. We will continue to evaluate our rate need and adjust rates as we deem necessary.

Our policy life expectancy increased in all BMTs, except in for-hire specialty and for-hire transportation for the second quarter 2025, compared to the same period last year. As of the end of the second quarter 2025, policy life expectancy has experienced sequential month-over-month improvement since the end of the third quarter 2024. We believe this improvement is due to the moderation of our rate increases, compared to competitor rate increases, and various initiatives, such as payment and renewal reminders.

IV. RESULTS OF OPERATIONS – INVESTMENTS

A. Investment Results

Our management philosophy governing the portfolio is to evaluate investment results on a total return basis. The fully taxable equivalent (FTE) total return includes recurring investment income, adjusted to a fully taxable amount for certain securities that receive preferential tax treatment (e.g., municipal securities), and total net realized, and changes in total net unrealized, gains (losses) on securities.

The following table summarizes investment results for the periods ended June 30:


	Three Months				Six Months
	2025		2024		2025		2024
Pretax recurring investment book yield (annualized)	4.2	%	3.9	%	4.2	%	3.8	%

FTE total return:
Fixed-income securities	1.7		0.8		4.3		1.2
Common stocks	10.9		3.6		5.3		13.8
Total portfolio	2.1		0.9		4.3		1.7

The increase in the book yield, compared to last year, primarily reflected investing new cash from insurance operations, and proceeds from maturing bonds, in higher coupon rate securities. The increase in the fixed-income portfolio FTE total return, compared to last year, primarily

reflected movement in U.S. Treasury yields year-over-year. The common stock FTE total return reflected general market conditions.

A further break-down of our FTE total returns for our fixed-income portfolio for the periods ended June 30, follows:


	Three Months				Six Months
	2025		2024		2025		2024
Fixed-income securities:
U.S. government obligations	1.7	%	0.6	%	4.7	%	0.2	%
State and local government obligations	1.4		0.5		3.5		0.9
Foreign government obligations	5.1		(0.1)		6.8		(2.5)
Corporate and other debt securities	2.0		1.0		4.0		1.7
Residential mortgage-backed securities	1.6		2.1		3.6		4.2
Commercial mortgage-backed securities	2.0		1.7		4.2		4.9
Other asset-backed securities	1.3		1.4		2.8		2.8
Nonredeemable preferred stocks	2.0		0.3		3.8		4.4
Short-term investments	1.1		1.4		2.2		2.8

B. Portfolio Allocation

The composition of the investment portfolio was:


($ in millions)	Fair Value		% of Total Portfolio		Duration (years)	Average Rating 1
June 30, 2025
U.S. government obligations	$	46,810	52.8	%	4.4	AA+
State and local government obligations	2,964		3.3		2.6	AA+
Foreign government obligations	17		0		1.1	AAA
Corporate and other debt securities	18,122		20.5		2.8	BBB+
Residential mortgage-backed securities	2,660		3.0		2.5	AA+
Commercial mortgage-backed securities	5,049		5.7		1.6	AA-
Other asset-backed securities	6,650		7.5		1.1	AA
Nonredeemable preferred stocks	500		0.6		1.2	BBB-
Short-term investments	2,103		2.4		<0.1	A+
Total fixed-income securities	84,875		95.8		3.4	AA-
Common equities	3,735		4.2		na	na
Total portfolio 2	$	88,610	100.0	%	3.4	AA-
June 30, 2024
U.S. government obligations	$	40,894	56.5	%	4.0	AA+
State and local government obligations	2,202		3.0		2.9	AA+
Foreign government obligations	16		0.1		2.1	AAA
Corporate and other debt securities	13,146		18.1		2.6	BBB+
Residential mortgage-backed securities	976		1.3		3.2	AA+
Commercial mortgage-backed securities	3,970		5.5		2.0	A+
Other asset-backed securities	6,285		8.7		1.1	AA+
Nonredeemable preferred stocks	838		1.2		1.8	BBB-
Short-term investments	733		1.0		<0.1	AA-
Total fixed-income securities	69,060		95.4		3.2	AA-
Common equities	3,296		4.6		na	na
Total portfolio 2	$	72,356	100.0	%	3.2	AA-
December 31, 2024
U.S. government obligations	$	45,988	57.3	%	4.1	AA+
State and local government obligations	2,778		3.5		2.5	AA+
Foreign government obligations	16		0		1.6	AAA
Corporate and other debt securities	13,954		17.4		2.6	BBB+
Residential mortgage-backed securities	1,601		2.0		2.6	AA
Commercial mortgage-backed securities	4,352		5.4		1.9	A+
Other asset-backed securities	6,643		8.3		1.2	AA+
Nonredeemable preferred stocks	728		0.9		1.4	BBB-
Short-term investments	615		0.7		<0.1	AA-
Total fixed-income securities	76,675		95.5		3.3	AA-
Common equities	3,575		4.5		na	na
Total portfolio 2	$	80,250	100.0	%	3.3	AA-
na = not applicable

1 Represents ratings at period end. Credit quality ratings are assigned by nationally recognized statistical rating organizations. To calculate the weighted average credit quality ratings, we weight individual securities based on fair value and assign a numeric score of 0-5, with non-investment-grade and non-rated securities assigned a score of 0-1. To the extent the weighted average of the ratings falls between AAA and AA+, we assign an internal rating of AAA-.

2 At June 30, 2025 and 2024 and December 31, 2024, we had $303 million, $74 million, and $125 million, respectively, of net unsettled security transactions included in accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets.

The total fair value of the portfolio at June 30, 2025 and 2024 and December 31, 2024, included $5.0 billion, $4.1 billion, and $6.2 billion, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of unsettled security transactions. A portion of the investments held at December 31, 2024 were sold and proceeds were used to pay our common share dividends in January 2025; see Note 9 – Dividends for additional information.

Our asset allocation strategy is to maintain 0%-25% of our portfolio in Group I securities, with the balance (75%-100%) of our portfolio in Group II securities.

We define Group I securities to include:

• common equities,

• nonredeemable preferred stocks,

• redeemable preferred stocks, except for 50% of investment-grade redeemable preferred stocks with cumulative dividends, which are included in Group II, and

• all other non-investment-grade fixed-maturity securities.

Group II securities include:

• short-term securities, and

• all other fixed-maturity securities, including 50% of investment-grade redeemable preferred stocks with cumulative dividends.

We believe this asset allocation strategy allows us to appropriately assess the risks associated with these securities for capital purposes and is in line with the treatment by our regulators.

The following table shows the composition of our Group I and Group II securities:


	June 30, 2025				June 30, 2024				December 31, 2024
($ in millions)	Fair Value		% of Total Portfolio		Fair Value		% of Total Portfolio		Fair Value		% of Total Portfolio
Group I securities:
Non-investment-grade fixed maturities	$	552	0.6	%	$	504	0.6	%	$	385	0.5	%

Nonredeemable preferred stocks	500		0.6		838		1.2		728		0.9
Common equities	3,735		4.2		3,296		4.6		3,575		4.5
Total Group I securities	4,787		5.4		4,638		6.4		4,688		5.9
Group II securities:
Other fixed maturities	81,720		92.2		66,985		92.6		74,947		93.4
Short-term investments	2,103		2.4		733		1.0		615		0.7
Total Group II securities	83,823		94.6		67,718		93.6		75,562		94.1
Total portfolio	$	88,610	100.0	%	$	72,356	100.0	%	$	80,250	100.0	%

To determine the allocation between Group I and Group II, we use the credit ratings from models provided by the National Association of Insurance Commissioners (NAIC) to classify our residential and commercial mortgage-backed securities, excluding interest-only (IO) securities, and the credit ratings from nationally recognized statistical rating organizations (NRSROs) to classify all other debt securities. NAIC ratings are based on a model that considers the book price of our securities when assessing the probability of future losses in assigning a credit rating. As a result, NAIC ratings can vary from credit ratings issued by NRSROs. Management believes NAIC ratings more accurately reflect our risk profile when determining the asset allocation between Group I and Group II securities.

Unrealized Gains (Losses)

As of June 30, 2025, our fixed-maturity portfolio had total after-tax net unrealized losses, which are recorded as part of accumulated other comprehensive income (loss) on our consolidated balance sheets, of $0.1 billion, compared to $1.7 billion and $1.4 billion at June 30, 2024 and December 31, 2024, respectively. The decrease in total unrealized losses from June 30, 2024 and December 31, 2024, was due to valuation increases across all fixed-maturity sectors, most prominently in our U.S. Treasury, corporate and other debt, and commercial mortgage-backed portfolios as lower interest rates and, in some cases, tighter credit spreads drove strong portfolio performance.

See Note 2 – Investments for a further break-out of our gross unrealized gains (losses).

Holding Period Gains (Losses)

The following table provides the balance and activity for both the gross and net holding period gains (losses) for the six months ended June 30, 2025:


(millions)	Gross Holding Period Gains		Gross Holding Period Losses		Net Holding Period Gains (Losses)
Balance at December 31, 2024
Hybrid fixed-maturity securities	$	8	$	(12)	$	(4)
Equity securities 1	2,838		(36)		2,802
Total holding period securities	2,846		(48)		2,798
Current year change in holding period securities
Hybrid fixed-maturity securities	8		6		14
Equity securities 1	144		(3)		141
Total changes in holding period securities	152		3		155
Balance at June 30, 2025
Hybrid fixed-maturity securities	16		(6)		10
Equity securities 1	2,982		(39)		2,943
Total holding period securities	$	2,998	$	(45)	$	2,953

1 Equity securities include common equities and nonredeemable preferred stocks.

Changes in holding period gains (losses), similar to unrealized gains (losses) in our fixed-maturity portfolio, are the result of changes in market conditions as well as sales of securities based on various portfolio management decisions.

Fixed-Income Securities

The fixed-income portfolio is managed internally and includes fixed-maturity securities, short-term investments, and nonredeemable preferred stocks. Following are the primary exposures for our fixed-income portfolio.

Interest Rate Risk Our duration of 3.4 years at June 30, 2025, 3.2 years at June 30, 2024, and 3.3 years at December 31, 2024, fell within our acceptable range of 1.5 to 5.0 years. The duration distribution of our fixed-income portfolio, excluding short-term investments, represented by the interest rate sensitivity of the comparable benchmark U.S. Treasury Notes, was:


Duration Distribution	June 30, 2025		June 30, 2024		December 31, 2024
1 year	11.2	%	9.5	%	9.6	%
2 years	8.0		10.6		8.2
3 years	28.0		31.3		29.5
5 years	32.6		36.3		43.6
7 years	19.5		11.0		8.2
10 years	0.7		1.3		0.9


Total fixed-income portfolio	100.0	%	100.0	%	100.0	%

Credit Risk This exposure is managed by maintaining an A minimum weighted average portfolio credit quality rating, as defined by NRSROs. At June 30, 2025 and 2024, and December 31, 2024, our weighted average credit quality rating was AA-. The credit quality distribution of the fixed-income portfolio was:


Average Rating 1	June 30, 2025		June 30, 2024		December 31, 2024
AAA	12.8	%	12.1	%	12.6	%
AA	61.0		63.6		64.2
A	8.2		6.8		6.4
BBB	16.8		16.1		15.7
Non-investment grade/non-rated
BB	1.0		1.1		0.8
B	0.1		0.2		0.2

Non-rated	0.1		0.1		0.1
Total fixed-income portfolio	100.0	%	100.0	%	100.0	%

1 The credit quality ratings are assigned by NRSROs.

Concentration Risk We did not have any investments in a single issuer, either overall or in the context of individual asset classes and sectors, that exceeded our thresholds during the second quarter 2025.

Prepayment and Extension Risk We did not experience significant adverse prepayment or extension of principal relative to our cash flow expectations in the portfolio during the second quarter 2025.

Liquidity Risk Our overall portfolio remains very liquid and we believe that it is sufficient to meet expected near-term liquidity requirements. The short-to-intermediate duration of our portfolio provides a source of liquidity. During the remainder of 2025, we expect approximately $3.8 billion, or 10%, of principal repayment from our fixed-income portfolio, excluding U.S. Treasury Notes and short-term investments. Cash from interest and dividend

payments provides an additional source of recurring liquidity.

The duration of our U.S. government obligations, which are included in the fixed-income portfolio, was comprised of the following at June 30, 2025:


($ in millions)	Fair Value		Duration (years)
U.S. Treasury Notes
Less than one year	$	272	0.7
One to two years	876		1.6
Two to three years	1,700		2.6
Three to five years	26,895		3.9
Five to seven years	17,067		5.7

Total U.S. Treasury Notes	$	46,810	4.4

ASSET-BACKED SECURITIES

Included in our fixed-income portfolio are asset-backed securities, which were comprised of the following at the balance sheet dates listed:


($ in millions)	Fair Value		Net Unrealized Gains (Losses)		% of Asset- Backed Securities		Duration (years)	Average Rating (at period end) 1
June 30, 2025
Residential mortgage-backed securities	$	2,660	$	14	18.5	%	2.5	AA+
Commercial mortgage-backed securities	5,049		(276)		35.2		1.6	AA-
Other asset-backed securities	6,650		(18)		46.3		1.1	AA
Total asset-backed securities	$	14,359	$	(280)	100.0	%	1.6	AA
June 30, 2024
Residential mortgage-backed securities	$	976	$	(7)	8.7	%	3.2	AA+
Commercial mortgage-backed securities	3,970		(487)		35.3		2.0	A+
Other asset-backed securities	6,285		(81)		56.0		1.1	AA+
Total asset-backed securities	$	11,231	$	(575)	100.0	%	1.6	AA
December 31, 2024
Residential mortgage-backed securities	$	1,601	$	(2)	12.7	%	2.6	AA
Commercial mortgage-backed securities	4,352		(369)		34.6		1.9	A+
Other asset-backed securities	6,643		(39)		52.7		1.2	AA+
Total asset-backed securities	$	12,596	$	(410)	100.0	%	1.6	AA

1 The credit quality ratings are assigned by NRSROs.

Residential Mortgage-Backed Securities (RMBS) The following table details the credit quality rating and fair value of our RMBS, along with the loan classification and a comparison of the fair value at June 30, 2025, to our original investment value (adjusted for returns of principal, amortization, and write-downs):



($ in millions) Average Rating 1	Non-Agency			Government/GSE 2			Total			% of Total
AAA	$	2,022		$	0		$	2,022		76.0	%
AA	139			1			140			5.3
A	404			0			404			15.2
BBB	92			0			92			3.5
Non-investment grade/non-rated:
BB	0			0			0			0

CCC and lower	1			0			1			0
Non-rated	1			0			1			0
Total fair value	$	2,659		$	1		$	2,660		100.0	%
Increase (decrease) in value	0.6		%	(3.9)		%	0.6		%

1 The credit quality ratings are assigned by NRSROs; when we assigned the NAIC ratings for our RMBS, 91.6% of our non-investment-grade securities were rated investment grade and reported as Group II securities.

2 The securities in this category are insured by a Government Sponsored Entity (GSE) and/or collateralized by mortgage loans insured by the Federal Housing Administration (FHA) or the U.S. Department of Veteran Affairs (VA). .

Our RMBS portfolio consists of deals that are backed by high-credit quality borrowers and/or those that have strong structural protections through underlying loan collateralization. During the second quarter of 2025, we continued to increase our exposure in this portfolio through purchases in both the primary and secondary markets. Our additions were concentrated in high-quality investment-grade securities.

Commercial Mortgage-Backed Securities (CMBS) The following table details the credit quality rating and fair value of our CMBS, along with a comparison of the fair value at June 30, 2025, to our original investment value (adjusted for returns of principal, amortization, and write-downs):



($ in millions) Average Rating 1	Multi-Borrower			Single-Borrower			Total			% of Total
AAA	$	127		$	2,245		$	2,372		47.0	%
AA	0			870			870			17.2
A	0			526			526			10.4
BBB	0			882			882			17.5
Non-investment grade/non-rated:
BB	0			387			387			7.7
B	0			12			12			0.2


Total fair value	$	127		$	4,922		$	5,049		100.0	%
Increase (decrease) in value	(4.7)		%	(5.2)		%	(5.2)		%

1 The credit quality ratings are assigned by NRSROs; when we assigned the NAIC ratings for our CMBS, 85% of our non-investment-grade securities were rated investment grade and reported as Group II securities, with the remainder classified as Group I.

During the second quarter 2025, our allocation to CMBS remained relatively stable. While CMBS credit spreads widened in the beginning of the quarter, they tightened back in and ended the quarter close to unchanged. We purchased securities in both the primary and secondary markets during the quarter. We focused on buying high-quality securities in sectors including apartments, grocery-anchored shopping centers, logistics, and self-storage. As of June 30, 2025, we had no delinquencies in our CMBS portfolio.

The following table shows the composition of our CMBS portfolio by maturity year and sector at June 30, 2025:



($ in millions) Maturity 1	Office		Lab Office		Multi-family		Multi-family IO		Industrial		Self- Storage		Casino		Data Center		Retail		Total		Average Original LTV		Average Current DSCR
2025	$	0	$	0	$	0	$	18	$	0	$	0	$	0	$	0	$	0	$	18
2026	326		47		165		37		89		94		114		0		0		872		62.8	%	1.5
2027	384		0		62		32		0		220		0		0		0		698		62.1		1.9
2028	284		0		0		24		0		118		0		0		0		426		66.0		1.7
2029	498		164		548		12		450		230		71		0		0		1,973		63.2		2.2
2030	107		61		0		4		144		0		100		65		220		701		61.1		2.5
2031	246		95		0		0		0		0		0		0		0		341		66.5		2.0
2032	20		0		0		0		0		0		0		0		0		20		68.0		1.7
Total fair value	$	1,865	$	367	$	775	$	127	$	683	$	662	$	285	$	65	$	220	$	5,049
LTV= loan to value
DSCR= debt service coverage ratio

1 The floating-rate securities were extended to their full maturity and fixed-rate securities are shown to their anticipated repayment date (if applicable) or their maturity date.

We show the average loan to value (LTV) of each maturity year when the loans were originated. The LTV ratio that management uses, which is commonly expressed as a percentage, compares the size of the entire mortgage loan to the appraised value of the underlying property collateralizing the loan at issuance. A LTV ratio less than 100% indicates excess collateral value over the loan amount. LTV ratios greater than 100% indicate that the loan amount exceeds the collateral value. We believe this ratio provides a conservative view of our actual risk of loss, as this number displays the entire mortgage LTV, while our ownership is only a portion of the structure of the mortgage loan-backed security. For many of the mortgage loans in our portfolio, our exposure is in a more senior part of the structure, which means that the LTV on our actual exposure is even lower than the ratios presented.

In addition to the LTV ratio, we also examine the credit of our CMBS portfolio by reviewing the debt service coverage ratio (DSCR) of the securities. The DSCR compares the underlying property ’ s annual net operating income to its annual debt service payments. A DSCR less than 1.0 times indicates that property operations do not generate enough income over the debt service payments, while a DSCR greater than 1.0 times indicates that there is an excess of operating income over the debt service payments. A number above 1.0 generally indicates that there would not be an incentive for the borrower to default in light of the borrower ’ s excess income. The DSCR reported in the table is calculated based on the most currently available net operating income and mortgage payments for the borrower.

Other Asset-Backed Securities (OABS) The following table details the credit quality rating and fair value of our OABS, along with a comparison of the fair value at June 30, 2025, to our original investment value (adjusted for returns of principal, amortization, and write-downs):



($ in millions) Average Rating	Automobile			Collateralized Loan Obligations			Student Loan			Whole Business Securitizations			Equipment			Other			Total			% of Total
AAA	$	3,047		$	399		$	46		$	0		$	974		$	252		$	4,718		71.0	%
AA	0			58			1			0			30			0			89			1.3
A	3			0			0			0			131			447			581			8.7
BBB	0			0			0			1,187			0			40			1,227			18.5
Non-investment grade/non-rated:
BB	0			0			0			0			0			35			35			0.5



Total fair value	$	3,050		$	457		$	47		$	1,187		$	1,135		$	774		$	6,650		100.0	%
Increase (decrease) in value	0.3		%	0		%	(5.1)		%	(2.1)		%	0.3		%	(0.5)		%	(0.3)		%

During the second quarter 2025, we selectively added securities to the OABS portfolio that we viewed as having attractive spreads and potential returns. The securities we acquired were predominantly in the automobile and equipment categories in highly rated, senior, and short-tenor debt tranches. Additions were primarily made in new issue markets with some selective secondary purchases.

STATE AND LOCAL GOVERNMENT OBLIGATIONS

The following table details the credit quality rating of our state and local government obligations (municipal securities) at June 30, 2025, without the benefit of credit or bond insurance:



(millions) Average Rating	General Obligations		Revenue Bonds		Total
AAA	$	728	$	514	$	1,242
AA	538		1,028		1,566
A	0		156		156


Total fair value	$	1,266	$	1,698	$	2,964

Included in revenue bonds were $734 million of single-family housing revenue bonds issued by state housing finance agencies, of which $358 million were supported by

individual mortgages held by the state housing finance

agencies and $376 million were supported by mortgage-backed securities.

Of the revenue bonds supported by individual mortgages held by the state housing finance agencies, the overall credit quality rating was AA+. Most of these mortgages were supported by the Federal Housing Administration, the U.S. Department of Veterans Affairs, or private mortgage insurance providers. Of the revenue bonds supported by mortgage-backed securities, 83% were collateralized by Ginnie Mae mortgages, which are fully guaranteed by the U.S. government; the remaining 17% were collateralized by Fannie Mae and Freddie Mac mortgages.

While credit spreads of municipal bonds widened in the beginning of the second quarter 2025, they tightened back in and ended the quarter close to unchanged. We selectively added short-duration bonds to the portfolio during the second quarter, and as a result, municipal securities as a percentage of the total fixed-income portfolio increased modestly.

CORPORATE AND OTHER DEBT SECURITIES

The following table details the credit quality rating of our corporate and other debt securities at June 30, 2025:



(millions) Average Rating	Consumer		Industrial		Communication		Financial Services		Technology		Basic Materials		Energy		Total
AAA	$	38	$	0	$	0	$	0	$	0	$	0	$	32	$	70
AA	93		0		0		1,041		0		0		44		1,178
A	810		512		165		2,945		60		148		566		5,206
BBB	3,824		1,695		393		2,176		1,590		85		1,447		11,210
Non-investment grade/non-rated:
BB	193		74		60		0		8		0		6		341
B	105		0		0		0		0		7		0		112

Non-rated	0		0		0		2		3		0		0		5
Total fair value	$	5,063	$	2,281	$	618	$	6,164	$	1,661	$	240	$	2,095	$	18,122

The size of our corporate and other debt portfolio increased to $18.1 billion at June 30, 2025, from $16.0 billion at

March 31, 2025. We selectively added securities as volatility provided periods with attractive credit spreads during the quarter. At June 30, 2025 and March 31, 2025, corporate and other debt securities made up approximately 21% and 20%, respectively, of our fixed-income portfolio. The duration of the corporate and other debt portfolio increased slightly to 2.8 years at June 30, 2025, from 2.7 years at March 31, 2025.

NONREDEEMABLE PREFERRED STOCKS

The table below shows the exposure break-down of our nonredeemable preferred stocks by sector and rating at June 30, 2025:



	Financial Services
(millions) Average Rating	U.S. Banks		Foreign Banks		Insurance		Other Financial		Industrials		Utilities		Total

BBB	$	226	$	14	$	64	$	32	$	0	$	39	$	375
Non-investment grade/non-rated:
BB	65		0		0		0		0		0		65

Non-rated	0		0		20		23		17		0		60
Total fair value	$	291	$	14	$	84	$	55	$	17	$	39	$	500

The majority of our nonredeemable preferred securities have fixed-rate dividends until a call date and then, if not called, generally convert to floating-rate dividends. The interest rate duration is calculated to reflect the call, floor, and floating-rate features. Although a nonredeemable preferred stock will remain outstanding if not called, its interest rate duration will reflect the variable nature of the dividend. At June 30, 2025, our non-investment-grade nonredeemable preferred stocks were with issuers that maintain investment-grade senior debt ratings.

We also face the risk that dividend payments could be deferred for one or more periods or skipped entirely. As of June 30, 2025, we expect all of these securities to pay their dividends in full and on time. Approximately 97% of our nonredeemable preferred stocks pay dividends that have tax preferential characteristics, while the balance pay dividends that are fully taxable.

At June 30, 2025, the nonredeemable preferred stock portfolio fair value was $0.5 billion, which is a slight decrease from $0.6 billion at March 31, 2025. This decline was primarily due to nonredeemable preferred stocks that were called during the quarter.

Common Equities

Common equities, as reported on our consolidated balance sheets, were comprised of the following:


($ in millions)	June 30, 2025				June 30, 2024				December 31, 2024
Common stocks	$	3,703	99.1	%	$	3,272	99.3	%	$	3,550	99.3	%
Other risk investments 1	32		0.9		24		0.7		25		0.7
Total common equities	$	3,735	100.0	%	$	3,296	100.0	%	$	3,575	100.0	%

1 The other risk investments consist of limited partnership interests.

The majority of our common stock portfolio consists of individual holdings selected based on their contribution to the correlation with the Russell 1000 Index. We held 685 out of 1,015, or 67%, of the common stocks comprising the index at June 30, 2025, which made up 93% of the total market capitalization of the index. At both June 30, 2025 and 2024, the year-to-date GAAP income total return was within our targeted tracking error of +/- 50 basis points. At December 31, 2024, the full year GAAP income total return did not meet our targeted tracking error.

Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Investors are cautioned that certain statements in this report not based upon historical fact are forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These statements often use words such as “estimate,” “expect,” “intend,” “plan,” “believe,” “goal,” “target,” “anticipate,” “will,” “could,” “likely,” “may,” “should,” and other words and terms of similar meaning, or are tied to future periods, in connection with a discussion of future operating or financial performance. Forward-looking statements are not guarantees of future performance, are based on current expectations and projections about future events, and are subject to certain risks, assumptions and uncertainties that could cause actual events and results to differ materially from those discussed herein. These risks and uncertainties include, without limitation, uncertainties related to:

• our ability to underwrite and price risks accurately and to charge adequate rates to policyholders;

• our ability to establish accurate loss reserves;

• the impact of severe weather, other catastrophe events, and climate change;

• the effectiveness of our reinsurance programs and the continued availability of reinsurance and performance by reinsurers;

• the secure and uninterrupted operation of the systems, facilities, and business functions and the operation of various third-party systems that are critical to our business;

• the impacts of a security breach or other attack involving our technology systems or the systems of one or more of our vendors;

• our ability to maintain a recognized and trusted brand and reputation;

• whether we innovate effectively and respond to our competitors’ initiatives;

• whether we effectively manage complexity as we develop and deliver products and customer experiences;

• the highly competitive nature of property-casualty insurance markets;

• whether we adjust claims accurately;

• compliance with complex and changing laws and regulations;

• the impact of misconduct or fraudulent acts by employees, agents, and third parties to our business and/or exposure to regulatory assessments;

• our ability to attract, develop, and retain talent and maintain appropriate staffing levels;

• litigation challenging our business practices, and those of our competitors and other companies;

• the success of our business strategy and efforts to acquire or develop new products or enter into new areas of business and our ability to navigate the related risks;

• how intellectual property rights affect our competitiveness and our business operations;

• the success of our development and use of new technology and our ability to navigate the related risks;

• the performance of our fixed-income and equity investment portfolios;

• the impact on our investment returns and strategies from regulations and societal pressures relating to environmental, social, governance and other public policy matters;

• our continued ability to access our cash accounts and/or convert investments into cash on favorable terms;

• the impact if one or more parties with which we enter into significant contracts or transact business fail to perform;

• legal restrictions on our insurance subsidiaries’ ability to pay dividends to The Progressive Corporation;

• our ability to obtain capital when necessary to support our business, our financial condition, and potential growth;

• evaluations and ratings by credit rating and other rating agencies;

• the variable nature of our common share dividend policy;

• whether our investments in certain tax-advantaged projects generate the anticipated returns;

• the impact from not managing to short-term earnings expectations in light of our goal to maximize the long-term value of the enterprise;

• the impacts of epidemics, pandemics, or other widespread health risks; and

• other matters described from time to time in our releases and publications, and in our periodic reports and other documents filed with the United States Securities and Exchange Commission, including, without limitation, the Risk Factors section of our Annual Report on Form 10-K for the year ending December 31, 2024.

Any forward-looking statements are made only as of the date presented. Except as required by applicable law, we undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or developments or otherwise.

In addition, investors should be aware that accounting principles generally accepted in the United States prescribe when a company may reserve for particular risks, including litigation exposures. Accordingly, results for a given reporting period could be significantly affected if and when we establish reserves for one or more contingencies. Also, our regular reserve reviews may result in adjustments of varying magnitude as additional information regarding claims activity becomes known. Reported results, therefore, may be volatile in certain accounting periods.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

The duration of the financial instruments held in our portfolio that are subject to interest rate risk was 3.4 years at June 30, 2025, 3.2 years at June 30, 2024, and 3.3 years at December 31, 2024. The weighted average beta of the equity portfolio was 1.1 at June 30, 2025, June 30, 2024, and December 31, 2024. We have not experienced a material impact when compared to the tabular presentations of our interest rate and market risk sensitive instruments in our Annual Report on Form 10-K for the year ended December 31, 2024.

Item 4. Controls and Procedures.

We, under the direction of our Chief Executive Officer and our Chief Financial Officer, have established disclosure controls and procedures that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms. The disclosure controls and procedures are also intended to ensure that such information is accumulated and communicated to our management, including the Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures.

Our Chief Executive Officer and our Chief Financial Officer reviewed and evaluated our disclosure controls and procedures as of the end of the period covered by this report. Based on that review and evaluation, the Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures are effectively serving the stated purposes as of the end of the period covered by this report.

There have not been any changes in our internal control over financial reporting during our most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II—OTHER INFORMATION

Item 1. Legal Proceedings.

For discussion of legal proceedings, see Note 11 – Litigation to the consolidated financial statements, which is incorporated herein by reference.

Item 1A. Risk Factors.

There have been no material changes in the risk factors from those discussed in Item 1A, Risk Factors included in our Annual Report on Form 10-K for the year ended December 31, 2024.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.


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
April	9,183	$	267.93	655,131	24,344,869
May – prior authorization	6,000	282.61		661,131	—
May – current authorization	15,795	280.87		15,795	24,984,205
June	14,367	272.33		30,162	24,969,838
Total	45,345	$	275.78

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.

In May 2025, the Board of Directors approved an authorization for the company to repurchase up to 25 million of its common shares. This authorization, which does not have an expiration date, terminated the 24,338,869 shares that remained under the Board’s May 2024 authorization to repurchase 25 million shares.

Share repurchases under this authorization may be accomplished through open market purchases, including trading plans entered into with one or more brokerage firms in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934, through privately negotiated transactions, pursuant to our equity incentive awards, or otherwise. During the second quarter 2025, all repurchases were accomplished in conjunction with our equity incentive awards or through the open market at the then-current market prices.

Item 5. Other Information.

During the second quarter 2025, no director or executive officer adopted or terminated a “Rule 10b5-1 trading arrangement” or “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408(a) of Regulation S-K.

Additional Information

President and CEO Susan Patricia Griffith’s quarterly letter to shareholders is included as Exhibit 99 to this Quarterly Report on Form 10-Q and in our online shareholders’ report located on our investor relations website at: investors.progressive.com/financials.

Item 6. Exhibits.

See exhibit index contained herein beginning on page 54, wh ich is incorporated by reference from information with respect to this item.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

THE PROGRESSIVE CORPORATION

(Registrant)

Date:

August 4, 2025

By: /s/ John P. Sauerland

John P. Sauerland

Vice President and Chief Financial Officer

EXHIBIT INDEX

Exhibit No.
Under
Reg. S-K,
Item 601

Form 10-Q
Exhibit
Number

Description of Exhibit

If Incorporated by Reference,
Documents with Which Exhibit was
Previously Filed with SEC

10(iii)

10.1

Form of Restricted Stock Award Agreement under The Progressive Corporation Amended and Restated 2017 Directors Equity Incentive Plan (for 2025)

Filed herewith

31.1

Rule 13a-14(a)/15d-14(a) Certification of the Principal Executive Officer, Susan Patricia Griffith

Filed herewith

31.2

Rule 13a-14(a)/15d-14(a) Certification of the Principal Financial Officer, John P. Sauerland

Filed herewith

32.1

Section 1350 Certification of the Principal Executive Officer, Susan Patricia Griffith

Furnished herewith

32.2

Section 1350 Certification of the Principal Financial Officer, John P. Sauerland

Furnished herewith

Letter to Shareholders from Susan Patricia Griffith, President and Chief Executive Officer (Regulation FD Disclosure)

Furnished herewith

101

101.INS

XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document

Filed herewith

101

101.SCH

Inline XBRL Taxonomy Extension Schema Document

Filed herewith

101

101.CAL

Inline XBRL Taxonomy Extension Calculation Linkbase Document

Filed herewith

101

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase Document

Filed herewith

101

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase Document

Filed herewith

101

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase Document

Filed herewith

104

Cover Page Interactive Data File (the cover page tags are embedded within the Inline XBRL document)

Filed herewith

TABLE OF CONTENTS

Part I Financial Information Item 1. Financial Statements Note 4 Debt Note 9 Dividends Note 2 Investments Note 3 Fair Value Note 10 Segment Information Note 12 Litigation Note 1 Reporting and Accounting Policies Item 2. Management S Discussion and Analysis Of Financial Condition and Results Of Operations Item 1a, Risk Factors Item 1, Business Reinsurance Note 6 Loss and Loss Adjustment Expense Reserve Item 3. Quantitative and Qualitative Disclosures About Market Risk Item 4. Controls and Procedures Part II Other Information Item 1. Legal Proceedings Note 11 Litigation Item 1A. Risk Factors Item 2. Unregistered Sales Of Equity Securities and Use Of Proceeds Item 5. Other Information Item 6. Exhibits

Exhibits

10(iii) 10.1 Form of Restricted Stock Award Agreement under The Progressive Corporation Amended and Restated 2017 Directors Equity Incentive Plan (for 2025) Filed herewith 31 31.1 Rule 13a-14(a)/15d-14(a) Certification of the Principal Executive Officer, Susan Patricia Griffith Filed herewith 31 31.2 Rule 13a-14(a)/15d-14(a) Certification of the Principal Financial Officer, John P. Sauerland Filed herewith 32 32.1 Section 1350 Certification of the Principal Executive Officer, Susan Patricia Griffith Furnished herewith 32 32.2 Section 1350 Certification of the Principal Financial Officer, John P. Sauerland Furnished herewith 99 99 Letter to Shareholders from Susan Patricia Griffith, President and Chief Executive Officer (Regulation FD Disclosure) Furnished herewith

Customer name	Ticker
American Axle & Manufacturing Holdings, Inc.	AXL
Aon Plc	AON
Marsh & McLennan Companies, Inc.	MMC

Supplier name	Ticker
Tesla, Inc.	TSLA
Toyota Motor Corporation	TM
Canaan Inc.	CAN
General Motors Company	GM
PACCAR Inc	PCAR
Honda Motor Co., Ltd.	HMC
General Motors Company	GM
PACCAR Inc	PCAR

PGR 10-Q Quarter ended June 30, 2025

Exhibits