Progressive

Does the commercial auto specialist offer its acquirer any key differentiation?

Reduced accident development led to a prior underestimate in the December frequency benefit.

The carrier’s net income for the period rose by 57% to $1.7bn.

John Barbagallo was scheduled to retire at the end of January but will work part-time for an extra year.

The insurer’s new UBI offering is set to support further pricing segmentation and growth.

Real-time data show an estimated decline in accidents of 26% as Covid-19 cases surged.

TO ACCESS THE FULL PDF REPORT, CLICK HERE.

Progressive’s September results were strong. The firm reported $0.57 in operating EPS, up 48.7% YoY, and saw a headline combined of 88.3% (down -4pts YoY).

Hurricanes Isaias and Laura produced the bulk of losses for the insurer, which is drawing down on an aggregate cover.

Progressive’s August results were solid. The firm reported $0.38 in operating EPS, up 11.6% YoY, and recorded a headline combined of 92.6% (down -0.8pts).

Since the start of the Covid-19 crisis, we have argued that the most likely outcome for P&C carriers is a get-out-of-jail-free card on loss trends due to lower frequency.

The “empty-street” economy has left auto exposed names in a relatively favorable position, highlighted by a second quarter of strong earnings growth and beats when compared to street estimates.