10-Q

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 March 31, 2021

or

☐ 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.)
6300 Wilson Mills Road,	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: 585,153,282 outstanding at March 31, 2021

1

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

The Progressive Corporation and Subsidiaries

Consolidated Statements of Comprehensive Income

(unaudited)

Three Months Ended March 31,	2021		2020
(millions — except per share amounts)
Revenues
Net premiums earned	$	10,420.2	$	9,430.7
Investment income	220.2		241.2
Net realized gains (losses) on securities:
Net realized gains (losses) on security sales	143.8		315.2
Net holding period gains (losses) on securities	441.5		(868.8)
Total net realized gains (losses) on securities	585.3		(553.6)
Fees and other revenues	165.7		153.5
Service revenues	53.8		51.6
Total revenues	11,445.2		9,323.4
Expenses
Losses and loss adjustment expenses	7,110.5		6,155.2
Policy acquisition costs	874.4		782.8
Other underwriting expenses	1,481.1		1,409.9
Investment expenses	5.6		5.3
Service expenses	49.3		47.5
Interest expense	56.4		48.0
Total expenses	9,577.3		8,448.7
Net Income
Income before income taxes	1,867.9		874.7
Provision for income taxes	387.9		175.6
Net income	1,480.0		699.1
Net income attributable to noncontrolling interest (NCI)	0		(6.4)
Net income attributable to Progressive	1,480.0		692.7
Other Comprehensive Income (Loss)
Changes in:
Total net unrealized gains (losses) on fixed-maturity securities	(539.6)		62.8
Net unrealized losses on forecasted transactions	0.2		0.2
Other comprehensive income (loss)	(539.4)		63.0
Other comprehensive income attributable to NCI	0		(0.5)
Comprehensive income attributable to Progressive	$	940.6	$	755.2
Computation of Earnings Per Common Share
Net income attributable to Progressive	$	1,480.0	$	692.7
Less: Preferred share dividends	6.7		6.7
Net income available to common shareholders	$	1,473.3	$	686.0
Average common shares outstanding - Basic	584.9		584.7
Net effect of dilutive stock-based compensation	2.0		2.2
Total average equivalent common shares - Diluted	586.9		586.9
Basic: Earnings per common share	$	2.52	$	1.17
Diluted: Earnings per common share	$	2.51	$	1.17

See notes to consolidated financial statements.

3

The Progressive Corporation and Subsidiaries

Consolidated Balance Sheets

(unaudited)

	March 31,				December 31,
(millions — except per share amount)	2021		2020		2020
Assets
Available-for-sale securities, at fair value:
Fixed maturities (amortized cost: $38,564.0, $33,761.1, and $35,589.1)	$	39,091.8	$	34,276.6	$	36,810.9
Short-term investments (amortized cost: $2,243.1, $2,524.2, and $5,218.5)	2,243.1		2,524.2		5,218.5
Total available-for-sale securities	41,334.9		36,800.8		42,029.4
Equity securities, at fair value:
Nonredeemable preferred stocks (cost: $1,453.9, $1,017.5, and $1,358.7)	1,507.2		933.4		1,447.9
Common equities (cost: $1,204.5, $1,113.2, and $1,187.3)	4,558.5		2,608.1		4,053.0
Total equity securities	6,065.7		3,541.5		5,500.9
Total investments	47,400.6		40,342.3		47,530.3
Cash and cash equivalents	122.9		369.5		76.5
Restricted cash	0.3		0.9		0
Total cash, cash equivalents, and restricted cash	123.2		370.4		76.5
Accrued investment income	166.0		171.6		176.4
Premiums receivable, net of allowance for credit losses of $265.3, $344.7, and $356.2	9,218.8		7,568.3		8,160.1
Reinsurance recoverables	4,143.2		3,639.6		4,019.4
Prepaid reinsurance premiums	667.6		438.2		368.1
Deferred acquisition costs	1,309.1		1,095.8		1,237.2
Property and equipment, net of accumulated depreciation of $1,318.5, $1,191.6, and $1,291.4	1,077.4		1,215.1		1,106.0
Goodwill	452.7		452.7		452.7
Intangible assets, net of accumulated amortization of $340.3, $328.5, and $326.1	157.2		213.8		171.4
Net federal deferred income taxes	0		20.6		0
Other assets	697.5		738.0		800.2
Total assets	$	65,413.3	$	56,266.4	$	64,098.3
Liabilities
Unearned premiums	$	15,045.9	$	12,641.1	$	13,437.5
Loss and loss adjustment expense reserves	21,063.7		18,306.5		20,265.8
Net federal deferred income taxes	241.5		0		310.0
Dividends payable on common shares	58.5		58.5		2,694.5
Accounts payable, accrued expenses, and other liabilities	5,770.4		5,289.2		4,955.8
Debt1	5,396.8		5,394.0		5,396.1
Total liabilities	47,576.8		41,689.3		47,059.7
Redeemable noncontrolling interest (NCI)	0		225.6		0
Shareholders’ Equity
Serial Preferred Shares (authorized 20.0)
Serial Preferred Shares, Series B, no par value (cumulative, liquidation preference $1,000 per share) (authorized, issued, and outstanding 0.5)	493.9		493.9		493.9
Common shares, $1.00 par value (authorized 900.0; issued 797.5, including treasury shares of 212.3, 212.2, and 212.3)	585.2		585.3		585.2
Paid-in capital	1,685.5		1,601.9		1,672.9
Retained earnings	14,679.6		11,266.2		13,354.9
Accumulated other comprehensive income (loss):
Net unrealized gains (losses) on fixed-maturity securities	407.7		423.6		947.3
Net unrealized losses on forecasted transactions	(15.4)		(16.2)		(15.6)
Accumulated other comprehensive income attributable to NCI	0		(3.2)		0
Total accumulated other comprehensive income (loss) attributable to Progressive	392.3		404.2		931.7
Total shareholders’ equity	17,836.5		14,351.5		17,038.6
Total liabilities, redeemable NCI, and shareholders’ equity	$	65,413.3	$	56,266.4	$	64,098.3

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

See notes to consolidated financial statements.

4

The Progressive Corporation and Subsidiaries

Consolidated Statements of Changes in Shareholders’ Equity

(unaudited)

Three Months Ended March 31,	2021		2020
(millions — except per share amounts)
Serial Preferred Shares, No Par Value
Balance, beginning of period	$	493.9	$	493.9
Balance, end of period	493.9		493.9
Common Shares, $1.00 Par Value
Balance, beginning of period	585.2		584.6
Treasury shares purchased	(0.9)		(0.3)
Net restricted equity awards issued/vested	0.9		1.0
Balance, end of period	585.2		585.3
Paid-In Capital
Balance, beginning of period	1,672.9		1,573.4
Amortization of equity-based compensation	15.8		23.3
Treasury shares purchased	(2.7)		(1.0)
Net restricted equity awards issued/vested	(0.9)		(1.0)
Reinvested dividends on restricted stock units	0.4		0.3
Adjustment to carrying amount of redeemable noncontrolling interest	0		6.9
Balance, end of period	1,685.5		1,601.9
Retained Earnings
Balance, beginning of period	13,354.9		10,679.6
Net income attributable to Progressive	1,480.0		692.7
Treasury shares purchased	(81.2)		(25.2)
Cash dividends declared on common shares ($0.10 and $0.10 per share)	(58.4)		(58.4)
Cash dividends declared on Serial Preferred Shares, Series B ($0 and $26.875 per share)	0		(13.4)
Reinvested dividends on restricted stock units	(0.4)		(0.3)
Other, net	(15.3)		(8.8)
Balance, end of period	14,679.6		11,266.2
Accumulated Other Comprehensive Income (Loss) Attributable to Progressive
Balance, beginning of period	931.7		341.7
Attributable to noncontrolling interest	0		(0.5)
Other comprehensive income (loss)	(539.4)		63.0
Balance, end of period	392.3		404.2
Total shareholders’ equity	$	17,836.5	$	14,351.5

There are 5.0 million Voting Preference Shares authorized; no such shares have been issued.

See notes to consolidated financial statements.

5

The Progressive Corporation and Subsidiaries

Consolidated Statements of Cash Flows        

(unaudited)

Three Months Ended March 31,	2021		2020
(millions)
Cash Flows From Operating Activities
Net income	$	1,480.0	$	699.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	62.9		62.6
Amortization of intangible assets	14.2		14.5
Net amortization of fixed-income securities	31.7		18.9
Amortization of equity-based compensation	15.8		23.3
Net realized (gains) losses on securities	(585.3)		553.6
Net (gains) losses on disposition of property and equipment	(1.1)		0.1
Changes in:
Premiums receivable	(1,058.7)		(61.0)
Reinsurance recoverables	(123.8)		(260.7)
Prepaid reinsurance premiums	(299.5)		188.3
Deferred acquisition costs	(71.9)		(39.3)
Income taxes	283.8		128.7
Unearned premiums	1,608.4		252.3
Loss and loss adjustment expense reserves	797.9		201.1
Accounts payable, accrued expenses, and other liabilities	380.1		(189.9)
Other, net	80.0		34.2
Net cash provided by operating activities	2,614.5		1,625.8
Cash Flows From Investing Activities
Purchases:
Fixed maturities	(10,421.4)		(10,433.0)
Equity securities	(196.7)		(366.6)
Sales:
Fixed maturities	5,590.3		7,415.9
Equity securities	63.0		281.0
Maturities, paydowns, calls, and other:
Fixed maturities	1,948.6		2,161.6
Equity securities	39.7		79.0
Net (purchases) sales of short-term investments	2,976.8		(718.9)
Net unsettled security transactions	267.6		586.1
Purchases of property and equipment	(50.5)		(62.4)
Sales of property and equipment	7.5		3.5
Net cash provided by (used in) investing activities	224.9		(1,053.8)
Cash Flows From Financing Activities
Dividends paid to common shareholders	(2,694.5)		(1,375.4)
Dividends paid to preferred shareholders	(13.4)		(13.4)
Acquisition of treasury shares for restricted stock tax liabilities	(30.0)		(26.5)
Acquisition of treasury shares acquired in open market	(54.8)		0
Net proceeds from debt issuances	0		986.3
Net cash used in financing activities	(2,792.7)		(429.0)
Increase in cash, cash equivalents, and restricted cash	46.7		143.0
Cash, cash equivalents, and restricted cash – January 1	76.5		227.4
Cash, cash equivalents, and restricted cash – March 31	$	123.2	$	370.4

See notes to consolidated financial statements.

6

The Progressive Corporation and Subsidiaries

Notes to Consolidated Financial Statements

(unaudited)

Note 1 Basis of Presentation — The accompanying consolidated financial statements include the accounts of The Progressive Corporation, our wholly owned insurance and non-insurance subsidiaries and affiliates in which we have a controlling financial interest. 

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 March 31, 2021, 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, 2020 (“2020 Annual Report to Shareholders”).

We perform analyses to evaluate our premiums receivables for expected credit losses, based on historical and current collections experience using actuarial analysis, to determine estimated rates of default. These rates are applied to the stratified subsets of our consumer receivable balances, based on the age of the receivable, to establish an allowance for credit loss. Progressive’s premiums receivables are short-term in nature and, generally, premiums are collected prior to providing risk coverage, minimizing our exposure to credit risk. Premiums receivables balances are written off once we have exhausted our collection efforts.

The following table summarizes changes in our allowance for credit loss exposure on our premiums receivables for the year-to-date periods ending:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Allowance for credit loss, beginning of period	$	356.2	$	283.2	$	283.2
Increase in allowance1	60.9		170.3		472.0
Write-offs2	(151.8)		(108.8)		(399.0)
Allowance for credit loss, end of period	$	265.3	$	344.7	$	356.2

1Represents the incremental increase in other underwriting expenses.

2Represents portion of allowance that is reversed when premiums receivables are written off.

During the first quarter 2021, the increase in our allowance for credit losses was lower than prior periods reflecting greater collections received on outstanding premiums receivable balances, due in part to the government stimulus and tax refund checks distributed during the quarter. In contrast, during the first quarter 2020, the increase in the allowance in part reflects the greater potential for credit losses due to the financial hardships of policyholders as a result of the economic impacts related to the spread of the novel coronavirus, COVID-19.

Other assets on the consolidated balance sheets include certain long-lived assets that are considered “held for sale.” The fair value of these held for sale assets, less the estimated costs to sell, was $55.1 million at March 31, 2021, $31.8 million at March 31, 2020, and $56.6 million at December 31, 2020.

7

Note 2 Investments — The following tables present the composition of our investment portfolio by major security type, consistent with our classification of how we manage, monitor, and measure the portfolio. Our securities are reported in our consolidated balance sheets at fair value. The changes in fair value for our fixed-maturity securities (other than hybrid securities) are reported as a component of accumulated other comprehensive income, net of deferred income taxes, in our consolidated balance sheets. The net holding period gains (losses) reported below represent the inception-to-date changes in fair value of the securities. The changes in the net holding period gains (losses) between periods for the hybrid securities and equity securities are recorded as a component of net realized gains (losses) on securities in our consolidated statements of comprehensive income.

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
March 31, 2021
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	16,002.7	$	181.7	$	(111.0)	$	0	$	16,073.4	33.9	%
State and local government obligations	2,574.8		65.3		(16.0)		0		2,624.1		5.6
Corporate debt securities	10,095.2		368.1		(24.0)		(3.1)		10,436.2		22.0
Residential mortgage-backed securities	548.3		5.7		(0.8)		0		553.2		1.2
Commercial mortgage-backed securities	5,868.3		68.8		(45.1)		0		5,892.0		12.4
Other asset-backed securities	3,293.5		30.6		(0.7)		0		3,323.4		7.0
Redeemable preferred stocks	181.2		2.9		(2.0)		7.4		189.5		0.4
Total fixed maturities	38,564.0		723.1		(199.6)		4.3		39,091.8		82.5
Short-term investments	2,243.1		0		0		0		2,243.1		4.7
Total available-for-sale securities	40,807.1		723.1		(199.6)		4.3		41,334.9		87.2
Equity securities:
Nonredeemable preferred stocks	1,453.9		0		0		53.3		1,507.2		3.2
Common equities	1,204.5		0		0		3,354.0		4,558.5		9.6
Total equity securities	2,658.4		0		0		3,407.3		6,065.7		12.8
Total portfolio1	$	43,465.5	$	723.1	$	(199.6)	$	3,411.6	$	47,400.6	100.0	%

8

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
March 31, 2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	10,841.2	$	654.5	$	0	$	0	$	11,495.7	28.5	%
State and local government obligations	2,243.9		64.8		(4.5)		0		2,304.2		5.7
Corporate debt securities	9,452.9		160.8		(120.1)		(1.7)		9,491.9		23.5
Residential mortgage-backed securities	574.3		1.5		(19.2)		0		556.6		1.4
Commercial mortgage-backed securities	5,822.4		30.2		(188.3)		0		5,664.3		14.0
Other asset-backed securities	4,674.9		4.3		(40.0)		(0.1)		4,639.1		11.5
Redeemable preferred stocks	151.5		0		(5.1)		(21.6)		124.8		0.3
Total fixed maturities	33,761.1		916.1		(377.2)		(23.4)		34,276.6		84.9
Short-term investments	2,524.2		0		0		0		2,524.2		6.3
Total available-for-sale securities	36,285.3		916.1		(377.2)		(23.4)		36,800.8		91.2
Equity securities:
Nonredeemable preferred stocks	1,017.5		0		0		(84.1)		933.4		2.3
Common equities	1,113.2		0		0		1,494.9		2,608.1		6.5
Total equity securities	2,130.7		0		0		1,410.8		3,541.5		8.8
Total portfolio1	$	38,416.0	$	916.1	$	(377.2)	$	1,387.4	$	40,342.3	100.0	%

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
December 31, 2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	12,437.9	$	305.8	$	(3.7)	$	0	$	12,740.0	26.8	%
State and local government obligations	3,099.4		123.1		(0.7)		0		3,221.8		6.8
Corporate debt securities	9,579.7		601.7		(0.1)		3.9		10,185.2		21.4
Residential mortgage-backed securities	503.3		7.1		(0.9)		0		509.5		1.1
Commercial mortgage-backed securities	6,042.6		142.5		(10.0)		0		6,175.1		13.0
Other asset-backed securities	3,745.0		40.1		(0.5)		0		3,784.6		7.9
Redeemable preferred stocks	181.2		3.6		(1.4)		11.3		194.7		0.4
Total fixed maturities	35,589.1		1,223.9		(17.3)		15.2		36,810.9		77.4
Short-term investments	5,218.5		0		0		0		5,218.5		11.0
Total available-for-sale securities	40,807.6		1,223.9		(17.3)		15.2		42,029.4		88.4
Equity securities:
Nonredeemable preferred stocks	1,358.7		0		0		89.2		1,447.9		3.1
Common equities	1,187.3		0		0		2,865.7		4,053.0		8.5
Total equity securities	2,546.0		0		0		2,954.9		5,500.9		11.6
Total portfolio1	$	43,353.6	$	1,223.9	$	(17.3)	$	2,970.1	$	47,530.3	100.0	%

1Our portfolio reflects the effect of net unsettled security transactions; at March 31, 2021, we had $363.1 million in other liabilities, compared to $598.0 million and $95.5 million at March 31, 2020 and December 31, 2020, respectively.

The total fair value of the portfolio at March 31, 2021 and 2020, and December 31, 2020, included $3.7 billion, $2.6 billion, and $6.2 billion, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of unsettled security transactions. During the first quarter 2021, we used a portion of these investments to pay our fourth quarter and annual 2020 common share dividends.

9

At March 31, 2021, bonds and certificates of deposit in the principal amount of $296.1 million were on deposit to meet state insurance regulatory requirements. We did not 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 March 31, 2021 and 2020, or December 31, 2020. At March 31, 2021, we did not hold any debt securities that were non-income producing during the preceding 12 months.

Short-Term Investments Our short-term investments may include commercial paper and other investments that are expected to mature or are redeemable within one year.

We invested in repurchase and reverse repurchase transactions during 2021 and 2020, but did not have any open positions at March 31, 2021 and 2020, or December 31, 2020. To the extent we enter into repurchase or reverse repurchase transactions, consistent with past practice, we would elect not to offset these transactions and would report them on a gross basis on our consolidated balance sheets, despite the option to elect to offset these transactions as long as they were with the same counterparty and subject to an enforceable master netting arrangement.

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:

	March 31,
(millions)	2021		2020		December 31, 2020
Fixed Maturities:
State and local government obligations	$	0	$	3.4	$	0
Corporate debt securities	295.0		116.5		188.4
Residential mortgage-backed securities	35.0		0		0
Other asset-backed securities	31.9		2.2		34.8
Redeemable preferred stocks	127.5		68.4		131.4
Total hybrid securities	$	489.4	$	190.5	$	354.6

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 have elected to record the changes in fair value of these securities through income as a component of net realized gains or losses.

Fixed Maturities The composition of fixed maturities by maturity at March 31, 2021, was:

(millions)	Cost		Fair Value
Less than one year	$	4,918.5	$	4,940.6
One to five years	24,370.8		24,814.6
Five to ten years	9,214.5		9,277.3
Ten years or greater	60.2		59.3
Total	$	38,564.0	$	39,091.8

Asset-backed securities are classified in the maturity distribution table based upon their projected cash flows. All other securities, which 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.

10

Gross Unrealized Losses The following tables show the composition of gross unrealized losses, for which no credit related impairment has been recognized, 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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
March 31, 2021
U.S. government obligations	36	$	8,612.2	$	(111.0)	35	$	8,598.6	$	(109.7)	1	$	13.6	$	(1.3)
State and local government obligations	92	816.0		(16.0)		92	816.0		(16.0)		0	0		0
Corporate debt securities	79	1,751.4		(24.0)		76	1,698.4		(23.9)		3	53.0		(0.1)
Residential mortgage-backed securities	21	123.4		(0.8)		6	94.4		(0.2)		15	29.0		(0.6)
Commercial mortgage-backed securities	95	2,542.2		(45.1)		77	2,023.9		(41.7)		18	518.3		(3.4)
Other asset-backed securities	43	505.8		(0.7)		36	477.6		(0.5)		7	28.2		(0.2)
Redeemable preferred stocks	1	10.5		(2.0)		0	0		0		1	10.5		(2.0)
Total fixed maturities	367	$	14,361.5	$	(199.6)	322	$	13,708.9	$	(192.0)	45	$	652.6	$	(7.6)

	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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
March 31, 2020
U.S. government obligations	1	$	100.3	$	0	1	$	100.3	$	0	0	$	0	$	0
State and local government obligations	89	528.4		(4.5)		78	507.7		(4.4)		11	20.7		(0.1)
Corporate debt securities	233	4,205.6		(120.1)		233	4,205.6		(120.1)		0	0		0
Residential mortgage-backed securities	70	532.5		(19.2)		46	425.0		(11.9)		24	107.5		(7.3)
Commercial mortgage-backed securities	204	4,441.5		(188.3)		187	4,109.2		(173.8)		17	332.3		(14.5)
Other asset-backed securities	216	3,558.1		(40.0)		201	3,514.2		(39.0)		15	43.9		(1.0)
Redeemable preferred stocks	4	56.3		(5.1)		3	45.2		(3.8)		1	11.1		(1.3)
Total fixed maturities	817	$	13,422.7	$	(377.2)	749	$	12,907.2	$	(353.0)	68	$	515.5	$	(24.2)

	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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
December 31, 2020
U.S. government obligations	9	$	1,511.0	$	(3.7)	9	$	1,511.0	$	(3.7)	0	$	0	$	0
State and local government obligations	30	208.7		(0.7)		30	208.7		(0.7)		0	0		0
Corporate debt securities	7	129.4		(0.1)		7	129.4		(0.1)		0	0		0
Residential mortgage-backed securities	21	44.4		(0.9)		0	0		0		21	44.4		(0.9)
Commercial mortgage-backed securities	43	893.3		(10.0)		9	93.6		(0.3)		34	799.7		(9.7)
Other asset-backed securities	22	183.7		(0.5)		9	74.4		(0.1)		13	109.3		(0.4)
Redeemable preferred stocks	1	11.0		(1.4)		0	0		0		1	11.0		(1.4)
Total fixed maturities	133	$	2,981.5	$	(17.3)	64	$	2,017.1	$	(4.9)	69	$	964.4	$	(12.4)

As of March 31, 2021, we had three securities in the table above, all in our corporate portfolio, that had their credit ratings downgraded during the quarter, with a combined fair value of $31.9 million and an unrealized loss of $0.7 million.

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.

11

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 not record any allowances for credit losses or any write-offs for amounts deemed to be uncollectible for the first three months of 2021 and did not have a credit loss allowance balance as of March 31, 2021 and 2020, or December 31, 2020. We considered several factors and inputs related to the individual securities as part of this analysis, including:

•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.

In order to determine the amount of credit loss, if any, we initially reviewed securities in a loss position to determine whether it was likely that we would be required, or whether we intended, to sell any of the securities prior to the recovery of their respective cost bases (which could be maturity). If we were likely to, or intended to, sell prior to a potential recovery, we would write off the unrealized loss. For those securities that we determined we were not likely to, or did not intend to, sell prior to a potential recovery, 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 value to determine if a credit loss existed. In the event that the NPV was below the amortized value, and the amount was determined to be material individually, or in aggregate, a credit loss would be deemed to exist, and either an allowance for credit losses would be created, or if an allowance currently existed, either a recovery of the previous allowance, or an incremental loss, would be recorded to net realized gains (losses) on securities.

As of March 31, 2021, we believe none of the unrealized losses relate to material credit losses on any specific securities, or in the aggregate, based on our review. We continue to expect all the securities in our 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 March 31, 2021, to determine if the accrued interest amounts were determined to be 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 not write off any accrued income as uncollectible at March 31, 2021.

12

Realized Gains (Losses) The components of net realized gains (losses) for the three months ended March 31, were:

	Three Months
(millions)	2021		2020
Gross realized gains on security sales
Available-for-sale securities:
U.S. government obligations	$	66.6	$	251.1
State and local government obligations	30.2		2.0
Corporate and other debt securities	20.7		32.4
Commercial mortgage-backed securities	29.8		6.1
Other asset-backed securities	0.7		0
Total available-for-sale securities	148.0		291.6
Equity securities:
Nonredeemable preferred stocks	17.3		19.6
Common equities	1.1		66.0
Total equity securities	18.4		85.6
Subtotal gross realized gains on security sales	166.4		377.2
Gross realized losses on security sales
Available-for-sale securities:
U.S. government obligations	(19.6)		(2.7)
State and local government obligations	(0.2)		0
Corporate and other debt securities	(2.1)		(1.0)
Commercial mortgage-backed securities	(0.6)		0
Other asset-backed securities	(0.1)		0
Total available-for-sale securities	(22.6)		(3.7)
Equity securities:
Nonredeemable preferred stocks	0		(4.4)
Common equities	0		(53.9)
Total equity securities	0		(58.3)
Subtotal gross realized losses on security sales	(22.6)		(62.0)
Net realized gains (losses) on security sales
Available-for-sale securities:
U.S. government obligations	47.0		248.4
State and local government obligations	30.0		2.0
Corporate and other debt securities	18.6		31.4
Commercial mortgage-backed securities	29.2		6.1
Other asset-backed securities	0.6		0
Total available-for-sale securities	125.4		287.9
Equity securities:
Nonredeemable preferred stocks	17.3		15.2
Common equities	1.1		12.1
Total equity securities	18.4		27.3
Subtotal net realized gains (losses) on security sales	143.8		315.2
Net holding period gains (losses)
Hybrid securities	(10.9)		(31.2)
Equity securities	452.4		(837.6)
Subtotal net holding period gains (losses)	441.5		(868.8)
Total net realized gains (losses) on securities	$	585.3	$	(553.6)

Realized gains (losses) on securities sold are computed using the first-in-first-out method.

13

The following table reflects our holding period realized gains (losses) on equity securities recognized for the three months ended March 31, 2021 and 2020, for equity securities held at the respective quarter end:

	Three Months
(millions)	2021		2020
Total net gains (losses) recognized during the period on equity securities	$	470.8	$	(810.3)
Less: Net gains (losses) recognized on equity securities sold during the period	18.4		27.3
Net holding period gains (losses) recognized during the period on equity securities held at period end	$	452.4	$	(837.6)

During the first quarter 2021, as expectations of U.S. economic growth increased, the value of our equity securities also rose. In contrast, during the first quarter 2020, we recognized significant declines in the equity security valuations due to investors reducing exposure to risk in response to the economic impact of COVID-19 restrictions.

Net Investment Income The components of net investment income for the three months ended March 31, were: 

	Three Months
(millions)	2021		2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	30.4	$	62.6
State and local government obligations	13.4		9.6
Corporate debt securities	85.2		58.0
Residential mortgage-backed securities	3.4		4.2
Commercial mortgage-backed securities	35.8		34.3
Other asset-backed securities	15.9		29.2
Redeemable preferred stocks	2.5		7.9
Total fixed maturities	186.6		205.8
Short-term investments	1.5		7.0
Total available-for-sale securities	188.1		212.8
Equity securities:
Nonredeemable preferred stocks	17.9		13.8
Common equities	14.2		14.6
Total equity securities	32.1		28.4
Investment income	220.2		241.2
Investment expenses	(5.6)		(5.3)
Net investment income	$	214.6	$	235.9

The amount of investment income (interest and dividends) we earn varies based on the average assets held during the year and the book yields of the securities in our portfolio. On a year-over-year basis, investment income decreased 9% for the first three months of 2021, compared to the same period last year, due to a decrease in the portfolio yield, which was partially offset by an increase in average assets. The recurring investment book yield decreased about 22% for the first three months of 2021, compared to the same period in 2020, as a result of investing cash from operations and reinvesting cash from sales, maturities, paydowns, and other redemptions at market yields that were significantly lower than the portfolio’s overall yield. The income reduction from the negative yield change was partially offset by an increase in income earned as a result of investing the $1.0 billion of proceeds from the debt issued during March 2020, as well as strong premium growth and underwriting profitability, net of payments of our common and preferred stock dividends.

14

Note 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 securities).

•Level 2: Inputs (other than quoted prices included within Level 1) that are observable for the instrument either directly or indirectly (e.g., certain corporate and municipal bonds and certain preferred stocks). 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 structured securities and privately held investments).

Determining the fair value of the investment portfolio is the responsibility of management. As part of the 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.

15

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
March 31, 2021
Fixed maturities:
U.S. government obligations	$	16,073.4	$	0	$	0	$	16,073.4	$	16,002.7
State and local government obligations	0		2,624.1		0		2,624.1		2,574.8
Corporate debt securities	0		10,436.2		0		10,436.2		10,095.2
Subtotal	16,073.4		13,060.3		0		29,133.7		28,672.7
Asset-backed securities:
Residential mortgage-backed	0		553.2		0		553.2		548.3
Commercial mortgage-backed	0		5,892.0		0		5,892.0		5,868.3
Other asset-backed	0		3,323.4		0		3,323.4		3,293.5
Subtotal asset-backed securities	0		9,768.6		0		9,768.6		9,710.1
Redeemable preferred stocks:
Financials	0		50.6		0		50.6		51.0
Utilities	0		11.4		0		11.4		10.0
Industrials	10.6		116.9		0		127.5		120.2
Subtotal redeemable preferred stocks	10.6		178.9		0		189.5		181.2
Total fixed maturities	16,084.0		23,007.8		0		39,091.8		38,564.0
Short-term investments	2,227.8		15.3		0		2,243.1		2,243.1
Total available-for-sale securities	18,311.8		23,023.1		0		41,334.9		40,807.1
Equity securities:
Nonredeemable preferred stocks:
Financials	113.8		1,274.7		35.0		1,423.5		1,373.9
Utilities	0		41.9		0		41.9		39.9
Industrials	0		25.2		16.6		41.8		40.1
Subtotal nonredeemable preferred stocks	113.8		1,341.8		51.6		1,507.2		1,453.9
Common equities:
Common stocks	4,555.3		0		0		4,555.3		1,201.3
Other risk investments	0		0		3.2		3.2		3.2
Subtotal common equities	4,555.3		0		3.2		4,558.5		1,204.5
Total equity securities	4,669.1		1,341.8		54.8		6,065.7		2,658.4
Total portfolio	$	22,980.9	$	24,364.9	$	54.8	$	47,400.6	$	43,465.5
Debt	$	0	$	6,195.2	$	0	$	6,195.2	$	5,396.8

16

	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
March 31, 2020
Fixed maturities:
U.S. government obligations	$	11,495.7	$	0	$	0	$	11,495.7	$	10,841.2
State and local government obligations	0		2,304.2		0		2,304.2		2,243.9
Corporate debt securities	0		9,491.9		0		9,491.9		9,452.9
Subtotal	11,495.7		11,796.1		0		23,291.8		22,538.0
Asset-backed securities:
Residential mortgage-backed	0		556.6		0		556.6		574.3
Commercial mortgage-backed	0		5,664.3		0		5,664.3		5,822.4
Other asset-backed	0		4,639.1		0		4,639.1		4,674.9
Subtotal asset-backed securities	0		10,860.0		0		10,860.0		11,071.6
Redeemable preferred stocks:
Financials	0		47.2		0		47.2		51.4
Utilities	0		9.2		0		9.2		10.0
Industrials	7.3		61.1		0		68.4		90.1
Subtotal redeemable preferred stocks	7.3		117.5		0		124.8		151.5
Total fixed maturities	11,503.0		22,773.6		0		34,276.6		33,761.1
Short-term investments	2,438.4		85.8		0		2,524.2		2,524.2
Total available-for-sale securities	13,941.4		22,859.4		0		36,800.8		36,285.3
Equity securities:
Nonredeemable preferred stocks:
Financials	105.5		752.3		13.1		870.9		937.4
Utilities	0		32.0		0		32.0		40.0
Industrials	0		15.3		15.2		30.5		40.1
Subtotal nonredeemable preferred stocks	105.5		799.6		28.3		933.4		1,017.5
Common equities:
Common stocks	2,607.8		0		0		2,607.8		1,112.9
Other risk investments	0		0		0.3		0.3		0.3
Subtotal common equities	2,607.8		0		0.3		2,608.1		1,113.2
Total equity securities	2,713.3		799.6		28.6		3,541.5		2,130.7
Total portfolio	$	16,654.7	$	23,659.0	$	28.6	$	40,342.3	$	38,416.0
Debt	$	0	$	6,108.6	$	0	$	6,108.6	$	5,394.0

17

	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
December 31, 2020
Fixed maturities:
U.S. government obligations	$	12,740.0	$	0	$	0	$	12,740.0	$	12,437.9
State and local government obligations	0		3,221.8		0		3,221.8		3,099.4
Corporate debt securities	0		10,185.2		0		10,185.2		9,579.7
Subtotal	12,740.0		13,407.0		0		26,147.0		25,117.0
Asset-backed securities:
Residential mortgage-backed	0		509.5		0		509.5		503.3
Commercial mortgage-backed	0		6,175.1		0		6,175.1		6,042.6
Other asset-backed	0		3,784.6		0		3,784.6		3,745.0
Subtotal asset-backed securities	0		10,469.2		0		10,469.2		10,290.9
Redeemable preferred stocks:
Financials	0		51.6		0		51.6		51.1
Utilities	0		11.7		0		11.7		10.0
Industrials	10.8		120.6		0		131.4		120.1
Subtotal redeemable preferred stocks	10.8		183.9		0		194.7		181.2
Total fixed maturities	12,750.8		24,060.1		0		36,810.9		35,589.1
Short-term investments	4,704.9		513.6		0		5,218.5		5,218.5
Total available-for-sale securities	17,455.7		24,573.7		0		42,029.4		40,807.6
Equity securities:
Nonredeemable preferred stocks:
Financials	117.7		1,212.3		35.0		1,365.0		1,278.6
Utilities	0		41.9		0		41.9		40.0
Industrials	0		24.3		16.7		41.0		40.1
Subtotal nonredeemable preferred stocks	117.7		1,278.5		51.7		1,447.9		1,358.7
Common equities:
Common stocks	4,049.9		0		0		4,049.9		1,184.2
Other risk investments	0		0		3.1		3.1		3.1
Subtotal common equities	4,049.9		0		3.1		4,053.0		1,187.3
Total equity securities	4,167.6		1,278.5		54.8		5,500.9		2,546.0
Total portfolio	$	21,623.3	$	25,852.2	$	54.8	$	47,530.3	$	43,353.6
Debt	$	0	$	6,793.5	$	0	$	6,793.5	$	5,396.1

Our portfolio valuations, excluding short-term investments, 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 are highly liquid, actively marketed, and have a very short duration, primarily 90 days or less to redemption. These securities are held at their original cost, adjusted for any accretion of discount, since that value very closely approximates what an active market participant would be willing to pay for such securities. The remainder of our short-term investments are classified as Level 2 and are not priced externally since these securities continually trade at par value. These securities are classified as Level 2 since they are primarily longer-dated securities issued by municipalities that contain either liquidity facilities or mandatory put features within one year.

At March 31, 2021, vendor-quoted prices represented 78% of our Level 1 classifications (excluding short-term investments), compared to 82% and 76% at March 31, 2020 and December 31, 2020, respectively. 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.

18

At March 31, 2021 and December 31, 2020, vendor-quoted prices comprised 99% of our Level 2 classifications (excluding short-term investments), while dealer-quoted prices represented the remaining 1%, compared to 98% and 2%, respectively, at March 31, 2020. 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 at least 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 our structured debt securities, including commercial, residential, and 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 our structured debt securities into more finite sectors (e.g., planned amortization class, first pay, second pay, senior, subordinated, etc.) and use duration, credit quality, and coupon to determine if the fair value is appropriate.

For our corporate debt and preferred stock (redeemable and nonredeemable) portfolios, as well as the notes issued by The Progressive Corporation (see Note 4 – Debt), we review securities by duration, coupon, and credit quality, 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 our municipal securities (e.g., general obligations, revenue, and housing), we stratify the portfolio to evaluate securities by type, coupon, credit quality, and duration 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.

Lastly, for our short-term securities, we look at acquisition price relative to the coupon or yield. Since our short-term securities are typically 90 days or less to maturity, with the majority listed in Level 2 being 30 days or less to redemption, we believe that acquisition price is the best estimate of fair value.

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.

19

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 explain significant price changes (i.e., greater than 2%) as known events occur in the marketplace and affect a 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.

Except as described below, our Level 3 securities are also 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. Certain private equity investments included in the Level 3 category are valued using external pricing supplemented by internal review and analysis.

After all the valuations are received and our review is complete, if the inputs used by vendors are determined to not contain sufficient observable market information, we will reclassify the affected security valuations to Level 3. At March 31, 2021 and 2020, and December 31, 2020, we did not have any securities in our fixed-maturity portfolio listed as Level 3.

At March 31, 2021 and December 31, 2020, we held four private nonredeemable preferred securities that were priced internally or by a pricing firm, and we held three private nonredeemable preferred securities at March 31, 2020. At March 31, 2021 and December 31, 2020, we held two Level 3 other risk investments that were priced using the cost method, compared to one Level 3 other risk investment at March 31, 2020.

To the extent we receive prices from external sources for the Level 3 securities, we would review those prices for reasonableness using internally developed assumptions and then compare our derived prices to the prices we received. During 2021 and 2020, there were no material assets or liabilities measured at fair value on a nonrecurring basis.

Based on our review, all prices received from external sources for 2021 remained unadjusted. 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 months ended March 31, 2021 and 2020:

	Level 3 Fair Value
(millions)	Fair Value at December 31, 2020		Calls/ Maturities/ Paydowns		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation		Net Transfers In (Out)		Fair Value at March 31, 2021
Equity securities:
Nonredeemable preferred stocks:
Financials	$	35.0	$	0	$	0	$	0	$	0	$	0	$	0	$	35.0
Industrials	16.7		0		0		0		0		(0.1)		0		16.6
Common equities:
Other risk investments	3.1		0		0.1		0		0		0		0		3.2
Total Level 3 securities	$	54.8	$	0	$	0.1	$	0	$	0	$	(0.1)	$	0	$	54.8

20

	Level 3 Fair Value
(millions)	Fair Value at December 31, 2019		Calls/ Maturities/ Paydowns		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation		Net Transfers In (Out)		Fair Value at March 31, 2020
Equity securities:
Nonredeemable preferred stocks:
Financials	$	27.1	$	0	$	0	$	0	$	0	$	(14.0)	$	0	$	13.1
Industrials	16.0		0		0		0		0		$	(0.8)	0		15.2
Common equities:
Other risk investments	0.3		0		0		0		0		0		0		0.3
Total Level 3 securities	$	43.4	$	0	$	0	$	0	$	0	$	(14.8)	$	0	$	28.6

The following tables provide a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at March 31, 2021 and 2020, and December 31, 2020:

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at March 31, 2021		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials1	$	25.0	Internal price	Unadjusted purchase price per share	3.7
Financials2	10.0		Internal price	Unadjusted purchase price per share	16.9
Industrials	6.9		Pricing firm	Market approach (guideline public company method)	5.4
Industrials	9.7		Pricing firm	Market approach (guideline public company method)	4.8
Subtotal Level 3 securities	51.6
Pricing exemption securities	3.2
Total Level 3 securities	$	54.8

1 This security was purchased in May 2020.

2 This security was purchased in November 2020.

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at March 31, 2020		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials	$	13.1	Internal price	Market approach (guideline public company method)	4.4
Industrials1	7.1		Internal price	Market approach (guideline public company method)	5.6
Industrials1	8.1		Internal price	Market approach (guideline public company method)	4.0
Subtotal Level 3 securities	28.3
Pricing exemption securities	0.3
Total Level 3 securities	$	28.6

1Modified prior year disclosure to present securities individually to conform to the current year presentation.

21

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at December 31, 2020		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials1	$	25.0	Internal price	Unadjusted purchase price per share	3.7
Financials2	10.0		Internal price	Unadjusted purchase price per share	16.9
Industrials	6.9		Pricing firm	Market approach (guideline public company method)	5.4
Industrials	9.8		Pricing firm	Market approach (guideline public company method)	4.8
Subtotal Level 3 securities	51.7
Pricing exemption securities	3.1
Total Level 3 securities	$	54.8

1 This security was purchased in May 2020.

2 This security was purchased in November 2020.

Note 4 Debt — Debt at each of the balance sheet periods consisted of:

	March 31, 2021				March 31, 2020				December 31, 2020
(millions)	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
3.75% Senior Notes due 2021 (issued: $500.0, August 2011)	$	499.9	$	506.7	$	499.5	$	510.7	$	499.8	$	510.9
2.45% Senior Notes due 2027 (issued: $500.0, August 2016)	497.4		526.8		497.0		488.2		497.3		541.1
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999)	297.0		386.1		296.7		395.3		296.9		409.4
4.00% Senior Notes due 2029 (issued: $550.0, October 2018)	545.6		623.7		545.1		605.7		545.5		660.4
3.20% Senior Notes due 2030 (issued: $500.0, March 2020)	496.2		536.7		495.8		543.2		496.1		575.5
6.25% Senior Notes due 2032 (issued: $400.0, November 2002)	396.0		531.4		395.8		539.6		396.0		582.0
4.35% Senior Notes due 2044 (issued: $350.0, April 2014)	346.8		413.9		346.7		391.7		346.7		459.7
3.70% Senior Notes due 2045 (issued: $400.0, January 2015)	395.6		430.2		395.4		406.2		395.5		481.0
4.125% Senior Notes due 2047 (issued: $850.0, April 2017)	841.7		977.1		841.6		991.9		841.7		1,113.1
4.20% Senior Notes due 2048 (issued: $600.0, March 2018)	590.0		698.7		589.9		675.8		590.0		806.7
3.95% Senior Notes due 2050 (issued: $500.0, March 2020)	490.6		563.9		490.5		560.3		490.6		653.7
Total	$	5,396.8	$	6,195.2	$	5,394.0	$	6,108.6	$	5,396.1	$	6,793.5

At March 31, 2021 and December 31, 2020, short-term debt consisted of the $500 million 3.75% Senior Notes that mature in August 2021; there was no short-term debt outstanding at March 31, 2020.

The Progressive Corporation has a line of credit with PNC Bank, National Association (PNC), in the maximum principal amount of $250 million. See the 2020 Annual Report to Shareholders for terms of this line of credit. We had no borrowings under the line of credit during the periods presented.

Note 5 Income Taxes — Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax bases of assets and liabilities at the enacted tax rates. We review our deferred tax assets regularly for recoverability. At March 31, 2021 and 2020, and December 31, 2020, we determined that we did not need a valuation allowance on our gross deferred tax assets. Although realization of the deferred tax assets is not assured, management believes that it is more likely than not 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.

For the three months ended March 31, 2021, there have been no material changes in our reserve for uncertain tax positions.

The effective tax rate for the three months ended March 31, 2021, was 20.8%, compared to 20.1% for the same period last year.

22

Net state deferred income tax asset and liability amounts as of March 31, 2020, were reclassified on the consolidated balance sheets into other assets and accounts payable, accrued expenses, and other liabilities, respectively, from net federal deferred income taxes to conform to the current year presentation.

Note 6 Loss and Loss Adjustment Expense Reserves — Activity in the loss and loss adjustment expense reserves is summarized as follows:

	March 31,
(millions)	2021		2020
Balance at January 1	$	20,265.8	$	18,105.4
Less reinsurance recoverables on unpaid losses	3,798.2		3,212.2
Net balance at January 1	16,467.6		14,893.2
Incurred related to:
Current year	6,986.1		6,011.1
Prior years	124.4		144.1
Total incurred	7,110.5		6,155.2
Paid related to:
Current year	3,029.3		2,916.4
Prior years	3,453.7		3,269.2
Total paid	6,483.0		6,185.6
Net balance at March 31	17,095.1		14,862.8
Plus reinsurance recoverables on unpaid losses	3,968.6		3,443.7
Balance at March 31	$	21,063.7	$	18,306.5

We experienced unfavorable reserve development of $124.4 million and $144.1 million during the first three months of 2021 and 2020, respectively, which is reflected as “Incurred related to prior years” in the table above.

First Quarter 2021

•Approximately 34% of the unfavorable prior year reserve development was attributable to accident year 2020, 34% to accident year 2019, and the remainder to accident years 2018 and prior.

•Our personal auto products incurred about $92 million of unfavorable loss and loss adjustment expense (LAE) reserve development, with about 60% attributable to the Agency business. The unfavorable development was primarily attributable to a higher than anticipated frequency of reopened personal injury protection (PIP) claims, primarily in Florida, and higher than anticipated late reported losses occurring toward the end of 2020 but not reported until 2021.

•Our Commercial Lines business experienced about $29 million of unfavorable development, primarily due to the emergence of large injury claims at rates higher than originally anticipated.

•Our special lines business experienced about $5 million of favorable development and our Property business experienced about $8 million of unfavorable development during the first quarter.

First Quarter 2020

•Approximately 52% of the unfavorable prior year reserve development was attributable to accident year 2019, 36% to accident year 2018, and the remainder to accident years 2017 and prior.

•Our personal auto products incurred about $104 million of unfavorable loss and LAE reserve development, with the Agency and Direct auto businesses each contributing about half. The unfavorable development was primarily attributable to revised estimates of our per claim settlement costs and late reported losses occurring toward the end of 2019 but not reported until 2020.

•Our Commercial Lines business experienced about $54 million of unfavorable development, primarily due to increased injury severity and the emergence of large injury claims at rates higher than originally anticipated.

•Our special lines business experienced about $14 million of favorable development and our Property business had minimal development during the first quarter.

23

Note 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, and are not considered part of the investment portfolio. The amount of reverse repurchase commitments held by these subsidiaries at March 31, 2021 and 2020, and December 31, 2020, were $154.0 million, $80.6 million, and $93.5 million, respectively. Restricted cash on our consolidated balance sheets represents cash that is restricted to pay flood claims under the National Flood Insurance Program’s “Write Your Own” program, for which certain subsidiaries are administrators.

During the first quarter 2021 and 2020, non-cash activity included declared but unpaid common share dividends of $58.5 million (see Note 9 – Dividends for further discussion) for both periods, and operating lease liabilities arising from obtaining right-of-use assets of $6.2 million and $9.7 million, respectively.

We paid the following in the respective periods: 

	Three Months Ended March 31,
(millions)	2021		2020
Income taxes	$	0.8	$	0
Interest	74.3		56.4
Operating lease liabilities	24.5		22.7

Note 8 Segment Information — Our Personal Lines segment writes insurance for personal autos and recreational vehicles (our special lines products). Our Commercial Lines segment writes auto-related primary liability and physical damage insurance, and business-related general liability and property insurance, predominately for small businesses. Our Property segment writes residential property insurance for homeowners, other property owners, and renters. Our service businesses provide insurance-related services, including processing Commercial Automobile Insurance Procedures/Plans (CAIP) business and 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; all intercompany transactions are eliminated in consolidation.

Following are the operating results for the respective periods:

	Three Months Ended March 31,
	2021				2020
(millions)	Revenues		Pretax Profit (Loss)		Revenues		Pretax Profit (Loss)
Personal Lines
Agency	$	4,098.2	$	547.5	$	3,828.7	$	601.6
Direct	4,431.7		414.6		3,992.4		473.0
Total Personal Lines1	8,529.9		962.1		7,821.1		1,074.6
Commercial Lines	1,417.8		228.5		1,189.0		112.5
Property2	472.5		(70.7)		420.6		49.2
Total underwriting operations	10,420.2		1,119.9		9,430.7		1,236.3
Fees and other revenues3	165.7		NA		153.5		NA
Service businesses	53.8		4.5		51.6		4.1
Investments4	805.5		799.9		(312.4)		(317.7)
Interest expense	NA		(56.4)		NA		(48.0)
Consolidated total	$	11,445.2	$	1,867.9	$	9,323.4	$	874.7

NA = Not applicable

1 Personal auto insurance accounted for 94% of the total Personal Lines segment net premiums earned during the three months ended March 31, 2021 and 2020; insurance for our special lines products (e.g., motorcycles, ATVs, RVs, watercraft, and snowmobiles) accounted for the balance of the Personal Lines net premiums earned.

2 For the three months ended March 31, 2021 and 2020, pretax profit (loss) includes $14.2 million and $14.5 million, respectively, of amortization expense predominately associated with intangible assets. See Note 12 – Goodwill and Intangible Assets for further discussion.

3 Pretax profit (loss) for fees and other revenues is allocated to operating segments.

4 Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expense.

24

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 (i.e., revenues from underwriting operations). 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. Following are the underwriting margins and combined ratios for our underwriting operations for the respective periods:

	Three Months Ended March 31,
	2021			2020
	Underwriting Margin		Combined Ratio	Underwriting Margin		Combined Ratio
Personal Lines
Agency	13.4	%	86.6	15.7	%	84.3
Direct	9.4		90.6	11.9		88.1
Total Personal Lines	11.3		88.7	13.7		86.3
Commercial Lines	16.1		83.9	9.5		90.5
Property1	(15.0)		115.0	11.7		88.3
Total underwriting operations	10.7		89.3	13.1		86.9

1 Included in the three months ended March 31, 2021 and 2020, is 3.0 points and 3.4 points, respectively, of amortization expense predominately associated with intangible assets.

Note 9 Dividends — Following is a summary of our common and preferred share dividends that were declared and/or paid during the three months ended March 31, 2021 and 2020:

(millions, except per share amounts)		Amount
Declared	Payable	Per Share		Accrued1
Common - Quarterly Dividends:
March 2021	April 2021	$	0.10	$	58.5
December 2020	January 2021	0.10		58.6
February 2020	April 2020	0.10		58.5
December 2019	January 2020	0.10		58.5
Common - Annual Variable Dividends:
December 2020	January 2021	4.50		2,635.9
December 2019	January 2020	2.25		1,316.9
Preferred Dividends:
December 2020	March 2021	26.875		13.4
February 2020	March 2020	26.875		13.4

1 The accrual is based on an estimate of shares outstanding as of the record date. The dividends accrued at March 31, 2020, were reclassified from accounts payable, accrued expenses, and other liabilities into dividends payable on common shares on the consolidated balance sheets, to conform to the current year presentation.

See Note 14 – Dividends in our 2020 Annual Report to Shareholders for a discussion of our common and preferred share dividend policies.

25

Note 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 gains (losses) on forecasted transactions		(Income) loss attributable to NCI
Balance at December 31, 2020	$	1,187.4	$	(255.7)	$	931.7	$	947.3	$	(15.6)	$	0
Other comprehensive income (loss) before reclassifications:
Investment securities	(551.4)		115.8		(435.6)		(435.6)		0		0
Loss attributable to noncontrolling interest (NCI)	0		0		0		0		0		0
Total other comprehensive income (loss) before reclassifications	(551.4)		115.8		(435.6)		(435.6)		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
Net realized gains (losses) on securities	131.7		(27.7)		104.0		104.0		0		0
Interest expense	(0.3)		0.1		(0.2)		0		(0.2)		0
Total reclassification adjustment for amounts realized in net income	131.4		(27.6)		103.8		104.0		(0.2)		0
Total other comprehensive income (loss)	(682.8)		143.4		(539.4)		(539.6)		0.2		0
Balance at March 31, 2021	$	504.6	$	(112.3)	$	392.3	$	407.7	$	(15.4)	$	0

							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 gains (losses) on forecasted transactions		(Income) loss attributable to NCI
Balance at December 31, 2019	$	435.7	$	(94.0)	$	341.7	$	360.8	$	(16.4)	$	(2.7)
Other comprehensive income (loss) before reclassifications:
Investment securities	318.2		(66.8)		251.4		251.4		0		0
Loss attributable to noncontrolling interest (NCI)	(0.6)		0.1		(0.5)		0		0		(0.5)
Total other comprehensive income (loss) before reclassifications	317.6		(66.7)		250.9		251.4		0		(0.5)
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
Net realized gains (losses) on securities	238.7		(50.1)		188.6		188.6		0		0
Interest expense	(0.3)		0.1		(0.2)		0		(0.2)		0
Total reclassification adjustment for amounts realized in net income	238.4		(50.0)		188.4		188.6		(0.2)		0
Total other comprehensive income (loss)	79.2		(16.7)		62.5		62.8		0.2		(0.5)
Balance at March 31, 2020	$	514.9	$	(110.7)	$	404.2	$	423.6	$	(16.2)	$	(3.2)

In an effort to manage interest rate risk, we may enter into forecasted transactions on Progressive’s debt issuances. We expect to reclassify $0.7 million (pretax) into interest expense during the next 12 months, related to net unrealized losses on forecasted transactions (see Note 4 – Debt in our 2020 Annual Report to Shareholders for further discussion).

26

Note 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 subsidiaries are named as defendants in a number of class action or individual lawsuits that challenge certain of the operations of the subsidiaries. Other insurance companies face many of these same issues.

These cases include those alleging damages as a result of, among other things, our subsidiaries’ practices in evaluating or paying medical or injury claims or benefits, including, but not limited to, personal injury protection, medical payments, uninsured motorist/underinsured motorist, and bodily injury benefits, and for reimbursing medical costs incurred by Medicare/Medicaid beneficiaries; our practices in evaluating or paying physical damage claims, including, but not limited to, our payment of total loss claims and labor rates paid to auto body repair shops; our insurance product design; employment matters; and cases challenging other aspects of our claims, marketing, pricing or sales practices or other business operations. Other insurance companies face many of these same issues.

The nature and volume of litigation to which The Progressive Corporation is subject is similar to that which was disclosed in Note 12 – Litigation in our 2020 Annual Report to Shareholders.

We plan to contest the pending lawsuits vigorously, but may pursue settlement negotiations in some cases, as we deem appropriate. The outcomes of pending cases are uncertain at this time. We establish accruals for these lawsuits when it is probable that a loss has been or will be incurred and we can reasonably estimate potential loss exposure, which may include a range of loss. As to lawsuits for which the loss is considered neither probable or estimable, or is considered probable but not estimable, we do not establish an accrual. Nevertheless, we continue to evaluate this pending litigation to determine if any losses not deemed probable and estimable become so, at which point we would establish an accrual at our best estimate of the loss or range of loss.

With respect to our pending lawsuits that are not related to claims under insurance policies, the accruals that we have established, if any, were not material at March 31, 2021 or 2020, and there were no material settlements during 2020 or the first three months of 2021. 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 2020 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 by a significant amount, 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 12 – Litigation in our 2020 Annual Report to Shareholders.

Note 12 Goodwill and Intangible Assets

Goodwill

During the three months ended March 31, 2021, there were no changes to the carrying amount of goodwill. No accumulated goodwill impairment losses exist.

Intangible Assets

The following table is a summary of the net carrying amount of other intangible assets:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Intangible assets subject to amortization	$	144.8	$	201.4	$	159.0
Indefinite-lived intangible assets1	12.4		12.4		12.4
Total	$	157.2	$	213.8	$	171.4

1 Indefinite-lived intangible assets are comprised of state insurance and agent licenses. State insurance licenses were previously subject to amortization under superseded accounting guidance and have $0.6 million of accumulated amortization for all periods presented.

27

Intangible assets subject to amortization consisted of the following:

	March 31, 2021						March 31, 2020						December 31, 2020
(millions)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Category:
Policies in force	$	256.2	$	219.6	$	36.6	$	256.2	$	183.0	$	73.2	$	256.2	$	210.4	$	45.8
Agency relationships	159.2		68.3		90.9		159.2		56.9		102.3		159.2		65.4		93.8
Software rights	69.1		51.8		17.3		79.1		53.2		25.9		69.1		49.7		19.4
Trade name	0		0		0		34.8		34.8		0		0		0		0
Total	$	484.5	$	339.7	$	144.8	$	529.3	$	327.9	$	201.4	$	484.5	$	325.5	$	159.0

Amortization expense was $14.2 million, compared to $14.5 million for the three months ended March 31, 2021 and 2020, respectively.

Note 13 New Accounting Standards

We did not adopt any new accounting standards during the three months ended March 31, 2021. We assessed the adoption impacts of recently issued accounting standards by the Financial Accounting Standards Board on our consolidated financial statements as well as material updates to previous assessments, if any, from our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. There were no new material accounting standards issued in the three months ended March 31, 2021, that impacted The Progressive Corporation.

28

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

I. OVERVIEW

The Progressive Corporation’s insurance subsidiaries recognized growth in both premiums and policies in force in the first quarter 2021, compared to the same period last year. During the quarter, we generated $11.7 billion of net premiums written, which is an increase of $1.9 billion, or 19%, compared to the first quarter 2020. We reached a significant milestone during the first quarter 2021 when we crossed over 25 million policies in force to end the quarter at 25.7 million companywide policies. Our underwriting profit margin of 10.7% for the first quarter 2021 was 2.4 points lower than the same period last year, resulting in a 9% decrease in underwriting profit.

On a year-over-year basis, for the first quarter 2021, net income increased 114% and comprehensive income increased 25%. The growth in net income primarily reflected net holding period gains in the current period, compared to net holding period losses in the first quarter last year. During the first three months of 2021, expectations of U.S. economic growth drove valuations of our equity securities higher, while during the same period last year, equity valuations declined as investors reduced exposure to risk in response to the economic impact of the federal, state, and local social distancing and shelter-in-place restrictions (“COVID-19 restrictions”). Comprehensive income, which includes net unrealized gains (losses) on fixed-maturity securities, grew substantially less than net income due to the rise in interest rates during the first quarter 2021, compared to an increase in value of our fixed-maturity portfolio during the same period last year.

During the first quarter 2021, our total capital (debt plus shareholders’ equity) increased $798.6 million, to $23.2 billion, primarily reflecting comprehensive income earned during the quarter, partially offset by common share repurchases and dividends declared during the period.

While we experienced solid results during the first quarter 2021, certain growth and profitability comparisons to the same period last year were, in part, impacted by the effects COVID-19 restrictions had on our prior year results. During the last three weeks of the first quarter 2020, we saw growth decrease, due to the substantial decline in shopping, and profitability increase, due to a reduction in auto accident frequency resulting from changes in driving patterns. The impact from the pandemic should be considered when comparing year-over-year changes.

A. Insurance Operations

We evaluate growth in terms of both net premiums written and policy in force growth. All three of our operating segments contributed to our solid premium and policy in force growth during the first quarter on a year-over-year basis. Our companywide net premiums written grew 19%, with Personal Lines growing 14%, Commercial Lines 57%, and Property 17%, primarily reflecting an increase in volume. In addition to the increase in our traditional business market targets year-over-year, Commercial Lines premiums growth reflected a significant increase in premiums in the transportation network company (TNC) business due to a $110.5 million reduction in net premiums written during the first quarter last year, reflecting a significant decrease in the estimated number of miles driven during the remainder of the policy terms due to the COVID-19 restrictions. At March 31, 2021, on a year-over-year basis, policies in force grew 12% companywide, with Personal Lines, Commercial Lines, and Property growing 12%, 13%, and 13%, respectively.

During the first quarter 2021, new applications (i.e., issued policies) increased 14%, 29%, and 26% in our Personal Lines, Commercial Lines, and Property segments, respectively. During the first quarter, total new personal auto applications increased 11% on a year-over-year basis, with Agency new applications increasing 5% and Direct increasing 17%. New applications for our special lines products were up 35% during the first quarter 2021, primarily due to continued growth in RV, boat, and motorcycle demand.

On a year-over-year basis for the first quarter 2021, our Personal Lines renewal applications increased 14%, Commercial Lines increased 14%, and Property increased 12%. Total personal auto renewal applications increased 15% over the first quarter last year.

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 multi-product households remains a key initiative and we will continue to make investments to improve the customer experience to continue to support that goal. Policy life expectancy, which is our actuarial estimate of the average length of time that a 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.

29

Due to insurance market volatility brought on by the COVID-19 virus, it may be difficult to assess the progress we are making against our retention goals. We evaluate retention using a trailing 12-month total auto policy life expectancy and a trailing 3-month policy life expectancy, which the latter does not address seasonality and can reflect more volatility. On a trailing 3-month basis, our personal auto policy life expectancy was up 12% year over year. As of the end of the first quarter 2021, our trailing 12-month total personal auto policy life expectancy increased 13%, compared to last year, in part attributable to suspending cancellations of policies for nonpayment as a part of the billing leniency programs that were in place primarily from mid-March through mid-May 2020, as well as other pandemic measures. Our Agency auto trailing 12-month policy life expectancy was up 13% and Direct auto was up 14%. Our Commercial Lines trailing 12-month policy life expectancy increased 7% year over year, special lines was up 5%, and Property decreased 3%.

Our companywide underwriting margin for the first quarter 2021 was strong at 10.7%, compared to 13.1% for the same period last year. Our personal auto incurred accident frequency was down about 3% for the first quarter 2021, as compared to the prior year, while severity was up about 5%. On a year-to-date basis, we incurred 2.0 points of catastrophe losses, compared to 0.9 points for the same period last year. Actuarial development was fairly consistent on a year-over-year basis. We continue to assess miles driven, weather events, and other components of expected loss costs on a state-by-state basis and, where appropriate, adjust rates accordingly. During the first quarter 2021, auto rates were increased less than 1% in both Personal Lines and Commercial Lines. During the last 12 months, we reduced rates on our personal auto products, primarily in response to driving and claims data gathered during the period, resulting in a written premium per policy decrease of 3% during the first quarter 2021.

Our Personal and Commercial Lines operating segments were profitable during the first quarter 2021, while our Property business generated an underwriting loss, due to significant catastrophe losses incurred during the quarter. Our Personal Lines segment generated an underwriting profit margin of 11.3% for the first quarter 2021, which was aided by our special lines business that contributed a favorable 1.5 point impact on our Personal Lines combined ratio, due to the seasonal nature of these products. Our Commercial Lines underwriting profit margin for the first quarter was 16.1%. Our Property segment had an underwriting loss margin of 15.0% for the quarter. On a net basis (i.e., after reinsurance), our Property business incurred catastrophe losses, during the first quarter, of $144.6 million, or 30.6 points on their combined ratio. During the first quarter 2021, we exceeded the $80 million single storm event threshold under our occurrence excess of loss reinsurance program and recorded a reinsurance recoverable of $20.0 million.

B. Investments

The fair value of our investment portfolio was $47.4 billion at March 31, 2021, compared to $47.5 billion at December 31, 2020. The decrease from year-end 2020, primarily reflected cash flows from operations of $2.6 billion, offset by $2.7 billion related to the payment of shareholder dividends during 2021.

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 March 31, 2021, 16% of our portfolio was allocated to Group I securities and 84% to Group II securities, compared to 14% and 86%, respectively, at December 31, 2020.

Our recurring investment income generated a pretax book yield of 2.1% for the first quarter 2021, compared to 2.7% for the same period in 2020, primarily due to investing new cash at lower interest rates. Our investment portfolio produced a fully taxable equivalent (FTE) total return of 0.3% and (0.6)% for the first quarter 2021 and 2020, respectively. Our fixed-income and common stock portfolios had FTE total returns of (0.9)% and 12.5%, respectively, for the first quarter 2021, compared to 1.2% and (20.5)%, respectively, last year. The year-over-year decrease in our fixed-income FTE total return was the result of an increase in interest rates. Our common stock portfolio’s FTE total return declined early in 2020 in response to the economic uncertainty due to the COVID-19 restrictions. The portfolio showed an improvement throughout the rest of the year and continued to improve during the first three months of 2021 as investors moved back into risk assets.

At March 31, 2021, the fixed-income portfolio had a weighted average credit quality of AA- and a duration of 3.1 years, compared to AA- and 3.0 years and AA- and 2.9 years at March 31, 2020 and December 31, 2020, respectively. While we have slightly lengthened our portfolio duration over the previous twelve months, it remains below the midpoint of our 1.5-year to 5-year range, which we believe provides some protection against a further increase in interest rates.

30

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. Operations generated positive cash flows of $2.6 billion and $1.6 billion for the three months ended March 31, 2021 and 2020, respectively, in part due to collecting premiums at a faster rate than losses are being paid.

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 dividends on our common shares and Series B Preferred Shares, our contractual obligations, and other expected capital requirements for the foreseeable future, including the $500 million of 3.75% Senior Notes maturing in August of 2021. In addition, in February 2021, Progressive entered into a definitive agreement to acquire all of the outstanding common shares of Protective Insurance Corporation for $23.30 per share, or approximately $338 million in aggregate. This transaction is expected to close prior to the end of the third quarter 2021, subject to certain required regulatory approvals and other customary closing conditions. We expect to fund this transaction with cash from operations or securities we currently hold. We did not experience a significant change in our liquidity needs during the first quarter 2021. During the first three months of 2021 and at all times during 2020, our total capital exceeded the sum of our regulatory capital layer plus our self-constructed extreme contingency layer, as described in our 2020 Annual Report.

Our total capital (debt plus shareholders’ equity) was $23.2 billion, at book value, at March 31, 2021, compared to $19.7 billion at March 31, 2020, and $22.4 billion at December 31, 2020. The increase since year end primarily reflected comprehensive income, in part offset by common share repurchases and dividends declared during the period.

Our debt-to-total capital ratio remained below 30% during all reported periods, consistent with our financial policy. This ratio, which reflects debt as a percent of debt plus shareholders’ equity, was 23.2% at March 31, 2021, 27.3% at March 31, 2020, and 24.1% at December 31, 2020. None of our outstanding senior notes have restrictive financial covenants or credit rating triggers.

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 three months of 2021, we returned capital to shareholders primarily through dividends and common share repurchases. During the quarter, the Board of Directors declared a $0.10 per common share dividend, or $58.5 million in the aggregate, which was paid in April 2021. In addition to the common share dividends, in March 2021, we paid Series B Preferred Share dividends in the aggregate amount of $13.4 million. In January 2021, we also paid common share dividends in the aggregate amount of $2.7 billion, or $4.60 per share (see Note 9 – Dividends for further discussion). In accordance with our financial policies, during the first quarter 2021, we repurchased 0.9 million common shares, at a total cost of $84.8 million, either in the open market or to satisfy tax withholding obligations as permitted under our equity compensation plans. We will continue to make decisions on returning capital to shareholders based on the strength of our capital position and the potential capital needs to expand our business operations.

In April 2021, we renewed the unsecured discretionary line of credit (the “Line of Credit”) with PNC Bank, National Association, in the maximum principal amount of $250 million. We did not engage in short-term borrowings, including any borrowings under our discretionary Line of Credit, to fund our operations or for liquidity purposes during the reported periods.

B. Commitments and Contingencies

Contractual Obligations

During the first three months of 2021, our contractual obligations have not changed materially from those discussed in our Annual Report on Form 10-K for the year ended December 31, 2020.

Off-Balance-Sheet Arrangements

Our off-balance-sheet leverage includes purchase obligations and catastrophe excess of loss reinsurance contracts. There have not been any material changes in off-balance-sheet items from those discussed in our Annual Report on Form 10-K for the year ended December 31, 2020.

31

III. RESULTS OF OPERATIONS – UNDERWRITING

A. Segment Overview

We report our underwriting operations in three segments: Personal Lines, Commercial Lines, and Property. As a component of our Personal Lines segment, we report our Agency and Direct business results to provide further understanding of our products by distribution channel.

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

	Three Months Ended March 31,
	2021		2020
Personal Lines
Agency	38	%	41	%
Direct	43		43
Total Personal Lines1	81		84
Commercial Lines	15		12
Property	4		4
Total underwriting operations	100	%	100	%

1 Personal auto insurance accounted for 95% of the total Personal Lines segment net premiums written during the three months ended March 31, 2021 and 2020; insurance for our special lines products accounted for the balance.

Our Personal Lines business writes insurance for personal autos and special lines products (e.g., motorcycles, watercraft, and RVs). We currently write our Personal Lines products in all 50 states. We also offer our personal auto product (not special lines products) in the District of Columbia. Within Personal Lines we often refer to our four consumer segments, which include:

•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 are primarily written for 6-month terms, we write 12-month auto policies in our Platinum agencies to promote bundled auto and home growth. At March 31, 2021, 12% of our Agency auto policies in force were 12-month policies, compared to 10% a year earlier. Our special lines products are written for 12-month terms.

Our Commercial Lines business writes auto-related primary liability and physical damage insurance, and business-related general liability and property insurance, predominately for small businesses. The majority of our Commercial Lines business is written through the independent agency channel. The amount of commercial auto business written through the direct channel, excluding our TNC business, represented 10% of premiums written for the first quarter 2021, compared to 8% for the same period last year. We write Commercial Lines business in all 50 states and about 90% of these policies are written for 12-month terms. To serve our direct channel customers, we continued to expand our product offerings, including the addition of our business owners policy in states where available, through our in-house agency and BusinessQuote Explorer®, our digital platform for small business consumers.

Our Property business writes residential property insurance for single family homes, condominium unit owners, renters, etc. We write the majority of our Property business through the independent agency channel; however, we continue to expand the distribution of our Property product offerings in the direct channel, which represented about 21% of premiums written for the first quarter 2021, compared to 16% for the same period last year. Property policies are written for 12-month terms. We write residential property in 47 states, renters in 48 states, and flood insurance in 46 states; we also write all of these products in the District of Columbia. Our flood insurance is written primarily through the National Flood Insurance Program and is 100% reinsured.

32

B. Profitability

Profitability for our underwriting operations is defined by pretax underwriting profit, 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 March 31,
	2021				2020
	Underwriting Profit (Loss)				Underwriting Profit (Loss)
($ in millions)	$		Margin		$		Margin
Personal Lines
Agency	$	547.5	13.4	%	$	601.6	15.7	%
Direct	414.6		9.4		473.0		11.9
Total Personal Lines	962.1		11.3		1,074.6		13.7
Commercial Lines	228.5		16.1		112.5		9.5
Property1	(70.7)		(15.0)		49.2		11.7
Total underwriting operations	$	1,119.9	10.7	%	$	1,236.3	13.1	%

1 For the three months ended March 31, 2021 and 2020, pretax profit (loss) includes $14.2 million and $14.5 million, respectively, of amortization expense predominately associated with intangible assets.

During the first quarter 2021, we incurred 2.0 points of companywide catastrophe losses, compared to 0.9 points for the same period last year. The majority of the catastrophe losses affected the Property business, primarily due to the winter storms in Texas and Oregon, and tornados in Texas and Alabama. Personal auto frequency was down 3% on a year-over-year basis, while severity was up 5%. In the first quarter 2020, we saw a significant decline in auto accident frequency as the COVID-19 restrictions were imposed and vehicle miles driven decreased significantly as a result. On a year-over-year basis, we increased our advertising spend 25% as we continue to generate sales at a cost below the maximum amount we are willing to spend to acquire new customers.

33

Further underwriting results for our Personal Lines business, including results by distribution channel, the Commercial Lines business, the Property business, and our underwriting operations in total, were as follows:

	Three Months Ended March 31,
Underwriting Performance1	2021	2020	Change
Personal Lines—Agency
Loss & loss adjustment expense ratio	67.8	64.7	3.1
Underwriting expense ratio	18.8	19.6	(0.8)
Combined ratio	86.6	84.3	2.3
Personal Lines—Direct
Loss & loss adjustment expense ratio	68.4	65.7	2.7
Underwriting expense ratio	22.2	22.4	(0.2)
Combined ratio	90.6	88.1	2.5
Total Personal Lines
Loss & loss adjustment expense ratio	68.1	65.2	2.9
Underwriting expense ratio	20.6	21.1	(0.5)
Combined ratio	88.7	86.3	2.4
Commercial Lines
Loss & loss adjustment expense ratio	63.5	68.1	(4.6)
Underwriting expense ratio	20.4	22.4	(2.0)
Combined ratio	83.9	90.5	(6.6)
Property
Loss & loss adjustment expense ratio	84.9	58.2	26.7
Underwriting expense ratio2	30.1	30.1	0
Combined ratio2	115.0	88.3	26.7
Total Underwriting Operations
Loss & loss adjustment expense ratio	68.3	65.3	3.0
Underwriting expense ratio	21.0	21.6	(0.6)
Combined ratio	89.3	86.9	2.4
Accident year — Loss & loss adjustment expense ratio3	67.1	63.8	3.3

1 Ratios are expressed as a percentage of net premiums earned; fees and other revenues are netted with underwriting expenses in the ratio calculations.

2 Included in the three months ended March 31, 2021 and 2020, are 3.0 points and 3.4 points, respectively, of amortization expense predominately associated with intangible assets. Excluding these additional expenses, for the three months ended March 31, 2021 and 2020, the Property business would have reported expense ratios of 27.1 and 26.7 and combined ratios of 112.0 and 84.9, respectively.

3 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.

34

Losses and Loss Adjustment Expenses (LAE)

	Three Months Ended March 31,
(millions)	2021		2020
Increase (decrease) in net loss and LAE reserves	$	627.5	$	(30.4)
Paid losses and LAE	6,483.0		6,185.6
Total incurred losses and LAE	$	7,110.5	$	6,155.2

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 vehicle businesses, are influenced by inflation and driving patterns, among other factors, some of which are discussed below. In our Property business, severity is primarily a function of construction costs and the age of the structure. 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 increased 3.0 points for the first quarter 2021, compared to the same period last year, primarily due to higher accident severity, catastrophe losses, and lower average personal auto premiums.

The following table shows our consolidated catastrophe losses, excluding loss adjustment expenses, incurred during the periods:

	Three Months Ended March 31,
($ in millions)	2021			2020
Personal Lines	$	65.1		$	37.2
Commercial Lines	1.8			1.3
Property	144.6			41.9
Total net catastrophe losses incurred	$	211.5		$	80.4
Combined ratio effect	2.0		pts.	0.9		pts.

During the first quarter 2021, the majority of catastrophe losses were due to winter storms in Texas and Oregon, and tornados in Texas and Alabama. We have responded, and plan to continue to respond, promptly to catastrophic events when they occur in order to provide exemplary claims service to our customers.

We do not have catastrophe-specific reinsurance for our Personal Lines or Commercial Lines businesses, but we reinsure portions of our Property business against various risks. The Property business reinsurance programs include: multi-year catastrophe excess of loss, aggregate excess of loss, and a catastrophe bond. See Item 1 – Description of Business-Reinsurance in our Annual Report on Form 10-K for the year ended December 31, 2020, for a discussion of our various reinsurance programs.

Under our various Property catastrophe-specific reinsurance, we ceded the following losses and allocated loss adjustment expenses (ALAE), including development on prior year storms, during the periods:

	Three Months Ended March 31,
(in millions)	2021		2020
Aggregate excess of loss:
Current accident year	$	0	$	0
Prior accident years	0.8		NA
Per occurrence excess of loss:
Current accident year	20.0		0
Prior accident years1	119.6		40.0
Total	140.4		40.0

NA = Not applicable; this reinsurance coverage was entered into on January 1, 2020.

1Primarily represents prior year development on Hurricane Irma. In 2017, we reached our excess of loss retention threshold for Irma and, as a result, all prior year development is fully ceded.

In late April 2021, severe hailstorms hit Texas and Oklahoma, which will impact both our vehicle and Property results in the second quarter. Our estimate of losses is still developing. Our Property excess of loss reinsurance program has an $80 million retention threshold from a single storm.

35

The following discussion of our severity and frequency trends in our personal auto businesses excludes comprehensive coverage because of its inherent volatility, as it is typically linked to catastrophic losses generally resulting from adverse weather. For our commercial auto products, 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.

Total personal auto incurred severity (i.e., average cost per claim, including both paid losses and the change in case reserves) on a calendar-year basis increased about 5% for the first quarter 2021, compared to the same period last year. These increases partly reflect shifts in the type of loss experienced and the impact from COVID-19 restrictions implemented during the last three weeks of the first quarter 2020.

Following are the changes we experienced in severity in our auto coverages on a year-over-year basis:

•Bodily injury increased about 13% and collision increased about 7% for the first quarter 2021, due in part to a shift in the mix to more severe accidents and rising repair costs compared to last year.

•Personal injury protection (PIP) decreased about 4% during the first quarter 2021, due in part to a high volume of reopened claims, primarily in Florida, in the first quarter 2020.

•Auto property damage was flat.

It is a challenge to estimate future severity, especially for bodily injury and PIP claims, but we continue to monitor changes in the underlying costs, such as medical costs, health care reform, court decisions, and jury verdicts, along with regulatory changes and other factors that may affect severity.

Our personal auto incurred frequency, on a calendar-year basis, decreased about 3% for the first quarter 2021, compared to the same period last year. Following are the frequency changes we experienced by coverage on a year-over-year basis, and primarily resulted from changes in driving patterns from those historically experienced:

•Auto property damage and bodily injury both decreased about 13%.

•PIP decreased about 17% for the quarter.

•Collision increased about 11% for the quarter.

We closely monitor the changes in frequency, but the degree or direction of near-term frequency change is not something that we are able to predict with any degree of confidence, given the uncertainty of the current environment. We saw the number of vehicle miles driven decrease dramatically when the COVID-19 restrictions were first put in place, especially during the early months of the pandemic. We analyze trends to distinguish changes in our experience from other external factors, such as changes in the number of vehicles per household, miles driven, gasoline prices, advances in vehicle safety, and unemployment rates, versus those resulting from shifts in the mix of our business or changes in driving patterns, to allow us to reserve more accurately for our loss exposures.

The changes we are disclosing in the paragraph below for our commercial auto products severity and frequency use a trailing 12-month period and exclude our TNC business. Using a trailing 12-month period addresses inherent seasonality trends in the commercial auto products and lessens the effects of month-to-month variability, including the impact of COVID-19 restrictions. Since the loss patterns in the TNC business are not indicative of our other commercial auto products, disclosing severity and frequency trends excluding that business is more indicative of our overall experience for the majority of our commercial auto products.

On a year-over-year basis, incurred severity in our commercial auto products increased 7% and frequency decreased 13%. The increase in severity is in part due to increased medical costs and actuarially determined reserves due to accelerating paid loss trends and shifts in the mix of business to for-hire transportation, which has higher average severity than the business auto and contractor business market targets. The frequency decrease was in part due to COVID-19 restrictions and continued product segmentation and underwriting, which created a mix shift toward more preferred, lower-frequency, business.

36

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

	Three Months Ended March 31,
($ in millions)	2021			2020
ACTUARIAL ADJUSTMENTS
Reserve decrease (increase)
Prior accident years	$	(22.1)		$	(9.5)
Current accident year	2.9			1.6
Calendar year actuarial adjustment	$	(19.2)		$	(7.9)
PRIOR ACCIDENT YEARS DEVELOPMENT
Favorable (unfavorable)
Actuarial adjustment	$	(22.1)		$	(9.5)
All other development	(102.3)			(134.6)
Total development	$	(124.4)		$	(144.1)
(Increase) decrease to calendar year combined ratio	(1.2)		pts.	(1.5)		pts.

Total development consists of both actuarial adjustments and “all other development” on prior accident years. 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 the current cost trends. For our Property business, 100% of catastrophe losses are reviewed monthly, and any development on catastrophe reserves are included as part of the actuarial adjustments. For the Personal Lines and Commercial Lines businesses, development for catastrophe losses for the vehicle businesses would be reflected in “all other development,” discussed below, to the extent they relate to prior year reserves. 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, excluding the impact from COVID-19 restrictions, 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. Changes in case law, particularly in PIP environments, can make it difficult to estimate reserves timely and with minimal variation. See Note 6 – Loss and Loss Adjustment Expense Reserves, for a more detailed discussion of our prior accident years development. We continue to focus on our loss reserve analysis, attempting to enhance accuracy and to further our understanding of our loss costs.

Underwriting Expenses

The companywide underwriting expense ratio (i.e., policy acquisition costs and other underwriting expenses, net of fees and other revenues, expressed as a percentage of net premiums earned) decreased 0.6 points for the first quarter 2021, compared to the same period last year. In the first quarter 2020, we increased our allowance for uncollectible accounts about 0.8 points due to billing leniencies that were put in place following the COVID-19 restrictions. The year-over-year increase in net premiums earned exceeded the increase in other underwriting expenses.

Progressive’s other underwriting expenses, net of fees and other revenues, increased 5% for the first quarter 2021, compared to the same period last year, primarily reflecting increased advertising spend. During the first quarter 2021, our advertising expenditures increased 25%, compared to the same period last year. We will continue to invest in advertising as long as we generate sales at a cost below the maximum amount we are willing to spend to acquire a new customer.

37

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 under which coverage was in effect as of the end of the period specified.

	Three Months Ended March 31,
($ in millions)	2021		2020		% Growth
NET PREMIUMS WRITTEN
Personal Lines
Agency	$	4,458.7	$	4,026.5	11	%
Direct	5,002.7		4,297.4		16
Total Personal Lines	9,461.4		8,323.9		14
Commercial Lines	1,794.1		1,144.1		57
Property	473.6		403.3		17
Total underwriting operations	$	11,729.1	$	9,871.3	19	%
NET PREMIUMS EARNED
Personal Lines
Agency	$	4,098.2	$	3,828.7	7	%
Direct	4,431.7		3,992.4		11
Total Personal Lines	8,529.9		7,821.1		9
Commercial Lines	1,417.8		1,189.0		19
Property	472.5		420.6		12
Total underwriting operations	$	10,420.2	$	9,430.7	10	%
	March 31,
(thousands)	2021		2020		% Growth
POLICIES IN FORCE
Agency auto	7,863.5		7,164.6		10%
Direct auto	9,338.8		8,126.3		15
Total auto	17,202.3		15,290.9		13
Special lines1	5,026.7		4,574.5		10
Personal Lines — total	22,229.0		19,865.4		12
Commercial Lines	858.9		759.7		13
Property	2,566.3		2,264.1		13
Companywide total	25,654.2		22,889.2		12%

1 Includes insurance for motorcycles, watercraft, RVs, and similar items.

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. As shown in the tables below, we measure retention by policy life expectancy. We review our customer retention for our personal auto products using both a trailing 3-month and a trailing 12-month period. Although using a trailing 3-month measure does not address seasonality and can reflect more volatility, this measure is more responsive to current experience and generally can be an indicator of how our retention rates are moving, especially given the impact of events that occurred during 2020.

As of March 31, 2021, we believe the growth in our auto trailing 12-month policy life expectancy remains artificially high due to suspending cancellations of policies for nonpayment, which impacted renewal activity during 2020. We continue to disclose our changes in policy life expectancy using both a trailing 3-month and 12-month period; however, we believe that the trailing 12-month measure will be positively impacted by the factor discussed above through mid-2021.

To analyze growth, we review new policies, rate levels, and the retention characteristics of our segments.

38

D. Personal Lines

The following table shows our year-over-year changes for our Personal Lines business:

	Growth Over Prior Year Quarter
	2021		2020
Applications
New	14	%	2	%
Renewal	14		10
Written premium per policy - Auto	(3)		1
Policy life expectancy - Auto
Trailing 3-months	12		(1)
Trailing 12-months	13		0

In our Personal Lines business, the increase in both new and renewal applications during 2021 resulted from increases in both our personal auto and special lines products. As discussed previously, the year-over-year comparisons will be impacted by the depressed growth in the first quarter 2020, resulting from the impact of COVID-19 restrictions that were put in place toward the end of the first quarter 2020.

During the three months ended March 31, 2021, our personal auto new application growth was 11%, compared to the same period last year. Our special lines products saw new applications increase 35% year over year, reflecting the continued high demand during the first quarter 2021, due to the overall growth in the RV, boat, and motorcycle industries. During the quarter, we continued to see strong renewal personal auto application growth, in part aided by rate decreases taken throughout 2020, in addition to the impact from the moratoriums and billing leniency efforts throughout 2020.

At the end of the first quarter 2021, we saw our Robinsons continue to enjoy year-over-year growth in personal auto policies in force that outpaced our other consumer segments (Sams, Dianes, and Wrights). New application growth across all four consumer segments was solid for the quarter. We experienced continued robust growth in Robinson quote volume; however, conversion in this consumer segment for the quarter was below last year. The other consumer segments have experienced increased year-over-year growth in both conversion and quoting and thus increases in the rate of growth in new business applications. Some of this growth can be attributed to the disproportionate drop in volume these consumer segments experienced March last year with the start of the pandemic.

We report our Agency and Direct business results separately as components of our Personal Lines segment to provide further understanding of our products by distribution channel. The channel discussions below are focused on personal auto insurance since this product accounted for 95% of the Personal Lines segment net premiums written during the quarter.

The Agency Business

	Growth Over Prior Year Quarter
	2021		2020
Applications - Auto
New	5	%	(3)	%
Renewal	12		9
Written premium per policy - Auto	(2)		1
Policy life expectancy - Auto
Trailing 3-months	12		2
Trailing 12-months	13		4

The 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 first quarter 2021, the Agency auto business experienced an increase in new application growth. During the quarter, we generated new auto application growth in 31 states, including six of our top 10 largest Agency states. Each of our consumer segments experienced positive new application and policy in force growth with the largest new application growth coming from our Sam consumer segment.

During the first quarter 2021, we experienced an increase in Agency auto quote volume of 5%, with the rate of conversion (i.e., converting a quote to a sale) unchanged, compared to the same period last year. Each consumer segment saw increases in quote volume, except for the Wrights where growth was flat, with Robinsons having the largest increase on a year-over-year basis.

39

We experienced an increase in the percentage of bundled Agency auto policies written for 12-month terms, which have about twice the amount of net premiums written compared to 6-month policies. At the end of the first quarter 2021, 12% of our Agency auto policies in force were 12-month policies, compared to about 10% a year earlier. Due to the rate decreases taken throughout 2020, written premium per policy on new Agency auto business was down 1% and renewal was down 2%, compared to the first quarter last year. During the last 12 months, we reduced rates primarily in response to driving and claims data gathered during the year.

The Direct Business

	Growth Over Prior Year Quarter
	2021		2020
Applications - Auto
New	17	%	5	%
Renewal	18		11
Written premium per policy - Auto	(4)		0
Policy life expectancy - Auto
Trailing 3-months	13		(4)
Trailing 12-months	14		(3)

The Direct business includes business written directly by Progressive on the Internet, through mobile devices, and over the phone. The Direct business experienced solid new and renewal application growth during the first quarter 2021, reflecting our increase in advertising spend and a depressed first quarter 2020, due to the impact of COVID-19 restrictions. During the quarter, we generated new auto application growth in 49 states and the District of Columbia, including nine of our top 10 largest Direct states. Consistent with the Agency auto business, during the quarter, we grew our new Direct auto applications and policies in force across all consumer segments, with the largest percentage of new application growth generated from our Sam consumer segment.

During the first quarter 2021, we experienced an increase in Direct auto quote volume of 7% and our rate of conversion increased 9% compared to the same period last year. All consumer segments saw an increase in quotes with the Robinsons showing the largest increase on a year-over-year basis.

Written premium per policy for new Direct auto business decreased 5% and renewal business decreased 3%, reflecting rate decreases taken during the last 12 months.

E. Commercial Lines

	Growth Over Prior Year Quarter
	2021		2020
Applications - Auto
New	28	%	5	%
Renewal	13		8
Written premium per policy	12		4
Policy life expectancy - Trailing 12-months	7		1
Note: Table excludes our TNC and BOP products.

Our Commercial Lines business operates in five traditional business markets, which include business auto, for-hire transportation, contractor, for-hire specialty, and tow markets, primarily written through the agency channel. We also write transportation network company (TNC) business and business owners policy (BOP) insurance.

Similar to our experience in our personal auto businesses, our Commercial Lines business results for the first quarter 2020 were negatively impacted by COVID-19 restrictions, which influenced the demands and general consumer habits for goods and services provided by our Commercial Lines customers and required that certain businesses undergo temporary closure.

Commercial Lines experienced solid new application growth in the first quarter 2021, reflecting continued improvement in the economy and our competitiveness in the marketplace. The new application growth during the first quarter was primarily driven by growth in our for-hire transportation business market target, due to greater demand for shipping services in light of the pandemic.

40

During the first quarter 2021, we experienced improvement in new consumer shopping, reflecting a 19% increase in quote volume and a 7% rate of conversion increase, compared to the same period last year.

During the first quarter 2021, volume in our TNC business increased significantly compared to when COVID-19 restrictions were first put into place. In the first quarter 2021, our net premiums written continued to reflect the increase in rideshare usage we started to experience during the second half of 2020. In contrast, during the first quarter last year, we decreased TNC business net premiums written by $110.5 million, which reflected the decrease in actual miles driven during the period and revised estimates of the miles to be driven during the remainder of the policy terms as a result of the COVID-19 restrictions.

F. Property

	Growth Over Prior Year Quarter
	2021		2020
Applications
New	26	%	7	%
Renewal	12		17
Written premium per policy	1		1
Policy life expectancy - Trailing 12-months	(3)		(5)

Our Property business writes residential property insurance for homeowners, other property owners, and renters, in the agency and direct channels. During the first quarter 2021, our Property business experienced a solid increase in new applications, primarily driven by growth in our direct channel and our Robinsons consumer segment, and a continued rebound in the housing market for new home sales. Our Property segment was not significantly impacted by COVID-19 restrictions during 2020.

During the first quarter 2021, our Property business experienced an increase in written premium per policy on a year-over-year basis, due to rate increases taken during the last 12 months, in part offset by a shift in the mix of business to a larger share of renters policies, which have lower written premiums per policy.

G. Income Taxes

A deferred tax asset or liability is a tax benefit or expense that is expected to be realized in a future period. At March 31, 2021 and December 31, 2020, we reported net federal deferred tax liabilities, and a net federal deferred tax asset at March 31, 2020. At March 31, 2021 and 2020, and December 31, 2020, we had net current income taxes payable of $372.4 million, $508.0 million, and $163.5 million, respectively, which were reported as part of other liabilities.

Our effective tax rate was 20.8% for the first quarter 2021, compared to 20.1% for the same period last year.

41

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 March 31:

	Three Months
	2021		2020
Pretax recurring investment book yield (annualized)	2.1	%	2.7	%
Weighted average FTE book yield (annualized)	2.1		2.7
FTE total return:
Fixed-income securities	(0.9)		1.2
Common stocks	12.5		(20.5)
Total portfolio	0.3		(0.6)

The decrease in the book yield compared to last year reflects investing new cash from operations and portfolio turnover during the past twelve months in lower interest rate securities. The decrease in our fixed-income total return reflects the increase in interest rates during the first quarter 2021.

A further break-down of our FTE total returns for our fixed-income portfolio for the periods ended March 31, follows: 

	Three Months
	2021		2020
Fixed-income securities:
U.S. Treasury Notes	(1.1)	%	6.3	%
Municipal bonds	(1.1)		2.7
Corporate bonds	(1.5)		(0.7)
Residential mortgage-backed securities	0.4		(2.8)
Commercial mortgage-backed securities	(0.8)		(2.8)
Other asset-backed securities	0.2		(0.5)
Preferred stocks	(0.1)		(12.2)
Short-term investments	0		0.4

42

B. Portfolio Allocation

The composition of the investment portfolio was: 

($ in millions)	Fair Value		% of Total Portfolio		Duration (years)	Rating1
March 31, 2021
U.S. government obligations	$	16,073.4	33.9	%	3.3	AAA
State and local government obligations	2,624.1		5.6		4.2	AA
Corporate debt securities	10,436.2		22.0		3.7	BBB
Residential mortgage-backed securities	553.2		1.2		1.0	AA
Commercial mortgage-backed securities	5,892.0		12.4		3.2	AA-
Other asset-backed securities	3,323.4		7.0		1.0	AA+
Preferred stocks	1,696.7		3.6		3.7	BBB-
Short-term investments	2,243.1		4.7		0.1	A
Total fixed-income securities	42,842.1		90.4		3.1	AA-
Common equities	4,558.5		9.6		na	na
Total portfolio2	$	47,400.6	100.0	%	3.1	AA-
March 31, 2020
U.S. government obligations	$	11,495.7	28.5	%	4.2	AAA
State and local government obligations	2,304.2		5.7		3.9	AA+
Corporate debt securities	9,491.9		23.5		3.6	BBB+
Residential mortgage-backed securities	556.6		1.4		0.8	AA
Commercial mortgage-backed securities	5,664.3		14.0		2.4	AA
Other asset-backed securities	4,639.1		11.5		0.9	AAA-
Preferred stocks	1,058.2		2.6		2.5	BBB-
Short-term investments	2,524.2		6.3		<0.1	A
Total fixed-income securities	37,734.2		93.5		3.0	AA-
Common equities	2,608.1		6.5		na	na
Total portfolio2	$	40,342.3	100.0	%	3.0	AA-
December 31, 2020
U.S. government obligations	$	12,740.0	26.8	%	3.3	AAA
State and local government obligations	3,221.8		6.8		4.4	AA
Corporate debt securities	10,185.2		21.4		3.8	BBB
Residential mortgage-backed securities	509.5		1.1		1.0	AA
Commercial mortgage-backed securities	6,175.1		13.0		3.2	AA-
Other asset-backed securities	3,784.6		7.9		1.0	AA+
Preferred stocks	1,642.6		3.5		3.6	BBB-
Short-term investments	5,218.5		11.0		<0.1	AA
Total fixed-income securities	43,477.3		91.5		2.9	AA-
Common equities	4,053.0		8.5		na	na
Total portfolio2	$	47,530.3	100.0	%	2.9	AA-
na = not applicable

1Represents 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-.

2Our portfolio reflects the effect of net unsettled security transactions; at March 31, 2021, we had $363.1 million in other liabilities, compared to $598.0 million and $95.5 million at March 31, 2020 and December 31, 2020, respectively.

The total fair value of the portfolio at March 31, 2021 and 2020, and December 31, 2020, included $3.7 billion, $2.6 billion, and $6.2 billion, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of any unsettled security transactions. During the first quarter 2021, we used a portion of these investments to pay our fourth quarter and annual 2020 common share dividends.

43

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 the 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: 

	March 31, 2021				March 31, 2020				December 31, 2020
($ 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	$	1,254.6	2.6	%	$	357.4	0.9	%	$	1,006.4	2.1	%
Redeemable preferred stocks1	94.8		0.2		62.4		0.1		97.3		0.2
Nonredeemable preferred stocks	1,507.2		3.2		933.4		2.3		1,447.9		3.1
Common equities	4,558.5		9.6		2,608.1		6.5		4,053.0		8.5
Total Group I securities	7,415.1		15.6		3,961.3		9.8		6,604.6		13.9
Group II securities:
Other fixed maturities	37,742.4		79.7		33,856.8		83.9		35,707.2		75.1
Short-term investments	2,243.1		4.7		2,524.2		6.3		5,218.5		11.0
Total Group II securities	39,985.5		84.4		36,381.0		90.2		40,925.7		86.1
Total portfolio	$	47,400.6	100.0	%	$	40,342.3	100.0	%	$	47,530.3	100.0	%

1We did not hold any non-investment-grade redeemable preferred stocks at March 31, 2021 and 2020, or December 31, 2020.

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) for classifying our residential and commercial mortgage-backed securities, excluding interest-only securities, and the credit ratings from nationally recognized statistical rating organizations (NRSRO) for 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 and Losses

As of March 31, 2021, our fixed-maturity portfolio had pretax net unrealized gains, recorded as part of accumulated other comprehensive income, of $523.5 million, compared to $538.9 million and $1,206.6 million at March 31, 2020 and December 31, 2020, respectively. The decrease from March 31, 2020, reflects sales of securities with unrealized gains in 2020 as well as increasing interest rates during the first quarter 2021. The decrease from December 31, 2020, was primarily due to increasing interest rates, which resulted in valuation decreases in all fixed-maturity sectors, most prominently in the U.S. Government and corporate portfolios.

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

44

Holding Period Gains and Losses

The following table provides the gross and net holding period gain (loss) balance and activity during the three months ended March 31, 2021:

(millions)	Gross Holding Period Gains		Gross Holding Period Losses		Net Holding Period Gains (Losses)
Balance at December 31, 2020
Hybrid fixed-maturity securities	$	15.2	$	0	$	15.2
Equity securities	2,961.5		(6.6)		2,954.9
Total holding period securities	2,976.7		(6.6)		2,970.1
Current year change in holding period securities
Hybrid fixed-maturity securities	(6.0)		(4.9)		(10.9)
Equity securities	452.7		(0.3)		452.4
Total changes in holding period securities	446.7		(5.2)		441.5
Balance at March 31, 2021
Hybrid fixed-maturity securities	9.2		(4.9)		4.3
Equity securities	3,414.2		(6.9)		3,407.3
Total holding period securities	$	3,423.4	$	(11.8)	$	3,411.6

Changes in holding period gains (losses), similar to unrealized gains (losses) in our fixed-maturity portfolio, are the result of changes in market performance 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. Details of our policies related to these exposures can be found in the Management’s Discussion and Analysis included in our 2020 Annual Report to Shareholders.

•Interest rate risk - our duration of 3.1 years at March 31, 2021, fell within our acceptable range of 1.5 to 5 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	March 31, 2021		March 31, 2020		December 31, 2020
1 year	20.2	%	24.6	%	19.5	%
2 years	17.9		13.6		18.7
3 years	25.7		22.8		24.9
5 years	18.1		21.3		18.5
7 years	11.7		11.2		10.9
10 years	6.4		6.5		7.5
Total fixed-income portfolio	100.0	%	100.0	%	100.0	%

45

•Credit risk - our credit quality rating of AA- was above our minimum threshold during the first quarter 2021. The credit quality distribution of the fixed-income portfolio was:

Rating	March 31, 2021		March 31, 2020		December 31, 2020
AAA	52.6	%	54.4	%	53.3	%
AA	8.1		8.7		9.8
A	10.6		12.5		11.1
BBB	24.7		22.7		22.9
Non-investment grade/non-rated1
BB	3.4		1.3		2.4
B	0.3		0.2		0.2
CCC and lower	0.1		0		0.1
Non-rated	0.2		0.2		0.2
Total fixed-income portfolio	100.0	%	100.0	%	100.0	%

1The ratings in the table above are assigned by NRSROs. The non-investment-grade fixed-income securities based upon our Group I classification represented 3.8% of the total fixed-income portfolio at March 31, 2021, compared to 1.5% at March 31, 2020 and 2.9% at December 31, 2020.

•Concentration risk - we did not have any investments in a single issuer, either overall or in the context of individual assets classes and sectors, that exceeded our thresholds during the first quarter 2021.

•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 first quarter 2021.

•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, as we expect approximately $3.4 billion, or 13.8%, of principal repayment from our fixed-income portfolio, excluding U.S. Treasury Notes and short-term investments, during the remainder of 2021. 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 March 31, 2021:

($ in millions)	Fair Value		Duration (years)
U.S. Treasury Notes
Less than one year	$	1,068.8	0.6
One to two years	4,018.0		1.6
Two to three years	4,673.8		2.6
Three to five years	4,143.6		4.3
Five to seven years	1,274.4		6.7
Seven to ten years	894.8		8.6
Total U.S. Treasury Notes	$	16,073.4	3.3

46

ASSET-BACKED SECURITIES

Included in the fixed-income portfolio are asset-backed securities (ABS), 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)	Rating (at period end)1
March 31, 2021
Residential mortgage-backed securities	$	553.2	$	4.9	5.7	%	1.0	AA
Commercial mortgage-backed securities	5,892.0		23.7		60.3		3.2	AA-
Other asset-backed securities	3,323.4		29.9		34.0		1.0	AA+
Total asset-backed securities	$	9,768.6	$	58.5	100.0	%	2.4	AA-
March 31, 2020
Residential mortgage-backed securities	$	556.6	$	(17.7)	5.1	%	0.8	AA
Commercial mortgage-backed securities	5,664.3		(158.1)		52.2		2.4	AA
Other asset-backed securities	4,639.1		(35.7)		42.7		0.9	AAA-
Total asset-backed securities	$	10,860.0	$	(211.5)	100.0	%	1.7	AA+
December 31, 2020
Residential mortgage-backed securities	$	509.5	$	6.2	4.9	%	1.0	AA
Commercial mortgage-backed securities	6,175.1		132.5		59.0		3.2	AA-
Other asset-backed securities	3,784.6		39.6		36.1		1.0	AA+
Total asset-backed securities	$	10,469.2	$	178.3	100.0	%	2.3	AA

1 The credit quality ratings in the table above 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 March 31, 2021, to our original investment value (adjusted for returns of principal, amortization, and write-downs):

Residential Mortgage-Backed Securities (at March 31, 2021)
($ in millions) Rating1	Non-Agency			Government/GSE2			Total			% of Total
AAA	$	333.7		$	1.8		$	335.5		60.6	%
AA	87.4			0.5			87.9			15.9
A	26.8			0			26.8			4.8
BBB	30.0			0			30.0			5.4
Non-investment grade/non-rated:
BB	35.7			0			35.7			6.5
B	8.1			0			8.1			1.5
CCC and lower	8.7			0			8.7			1.6
Non-rated	20.5			0			20.5			3.7
Total fair value	$	550.9		$	2.3		$	553.2		100.0	%
Increase (decrease) in value	0.9		%	7.9		%	0.9		%

1The credit quality ratings in the table above are assigned by NRSROs; when we assign the NAIC ratings for our RMBS, $33.3 million of our non-investment-grade securities are rated investment-grade and classified as Group II, and $39.7 million, or 7.2% of our total RMBS, are not rated by the NAIC and are classified as Group I.

2The 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).

In the residential mortgage-backed sector, our portfolio consists of deals that are backed by high-credit quality borrowers or have strong structural protections through underlying loan collateralization. In our view, the risk/reward potential during the first three months of 2021 was lower in this portfolio relative to other comparable investments.

47

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 March 31, 2021, to our original investment value (adjusted for returns of principal, amortization, and write-downs):

Commercial Mortgage-Backed Securities (at March 31, 2021)
($ in millions) Rating1	Multi-Borrower			Single-Borrower			Total			% of Total
AAA	$	336.3		$	1,775.5		$	2,111.8		35.8	%
AA	0			1,631.0			1,631.0			27.7
A	0			1,117.0			1,117.0			19.0
BBB	0			840.6			840.6			14.3
Non-investment grade/non-rated:
BB	0			191.3			191.3			3.2
B	0.3			0			0.3			0
Total fair value	$	336.6		$	5,555.4		$	5,892.0		100.0	%
Increase (decrease) in value	3.2		%	0.2		%	0.4		%

1The credit quality ratings in the table above are assigned by NRSROs; when we assign the NAIC ratings for our CMBS, $0.8 million of our non-investment-grade securities are rated investment-grade and classified as Group II, and $190.8 million, or 3.2% of our total CMBS, are not rated by the NAIC and are classified as Group I.

During the first quarter 2021, we were active in purchasing single-asset/single-borrower securities in both new issue and secondary markets. The strong market tone from the end of the year continued into the first quarter, with new issues being received well and credit spreads narrowing. We also focused on adding to some existing positions in the high-quality office and life sciences sectors.

During the first quarter 2021, we sold some of our AAA-rated securities, in both the fixed-rate and floating-rate sectors. We also continued scaling back on positions that had performed well or were no longer core to our strategy.

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 March 31, 2021, to our original investment value (adjusted for returns of principal, amortization, and write-downs):

Other Asset-Backed Securities (at March 31, 2021)
($ in millions) Rating	Automobile			Credit Card			Student Loan			Whole Business Securitizations			Equipment			Other			Total			% of Total
AAA	$	1,023.4		$	101.8		$	145.0		$	0		$	547.0		$	449.9		$	2,267.1		68.2	%
AA	204.6			0			18.2			0			133.3			39.1			395.2			11.9
A	34.0			0			10.2			0			118.1			61.5			223.8			6.7
BBB	7.2			0			0			430.1			0			0			437.3			13.2
Total fair value	$	1,269.2		$	101.8		$	173.4		$	430.1		$	798.4		$	550.5		$	3,323.4		100.0	%
Increase (decrease) in value	0.4		%	1.3		%	1.7		%	1.5		%	1.3		%	0.6		%	0.9		%

As we believed valuations across other asset classes were more attractive during the quarter, our OABS portfolio offered less relative value. We selectively added to our automobile, equipment, and student loan OABS sectors mostly through new issuances. Due to amortization and scheduled returns of principal, our OABS portfolio decreased during the first quarter 2021.

48

MUNICIPAL SECURITIES

The following table details the credit quality rating of our municipal securities at March 31, 2021, without the benefit of credit or bond insurance:

Municipal Securities (at March 31, 2021)
(millions) Rating	General Obligations		Revenue Bonds		Total
AAA	$	578.6	$	255.5	$	834.1
AA	467.1		762.8		1,229.9
A	0		559.1		559.1
BBB	0		1.0		1.0
Total	$	1,045.7	$	1,578.4	$	2,624.1

Included in revenue bonds were $513.6 million of single-family housing revenue bonds issued by state housing finance agencies, of which $364.8 million were supported by individual mortgages held by the state housing finance agencies and $148.8 million were supported by mortgage-backed securities.

Of the programs supported by mortgage-backed securities, approximately 25% were collateralized by Fannie Mae and Freddie Mac mortgages; the remaining 75% were collateralized by Ginnie Mae mortgages, which are fully guaranteed by the U.S. government. Of the programs 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.

As spreads tightened during the quarter, we continued to reduce our allocation to the municipal sector. Our sales were primarily in revenue bonds purchased in 2020 at more attractive levels. As mutual funds continued receiving strong inflows, the municipal sector has performed relatively well. At current valuations, a smaller portion of the municipal market is attractive to us on a relative value basis.

CORPORATE SECURITIES

The following table details the credit quality rating of our corporate securities at March 31, 2021:

Corporate Securities (at March 31, 2021)
(millions) Rating	Consumer		Industrial		Communication		Financial Services		Technology		Basic Materials		Energy		Total
AAA	$	0	$	0	$	0	$	30.1	$	0	$	0	$	0	$	30.1
AA	98.9		0		0		135.9		26.0		0		8.0		268.8
A	500.0		221.8		201.0		1,087.6		194.4		124.3		103.7		2,432.8
BBB	2,406.7		1,558.2		213.8		1,243.9		552.1		43.1		627.5		6,645.3
Non-investment grade/non-rated:
BB	296.1		126.9		130.6		109.9		139.5		36.1		42.8		881.9
B	121.9		5.2		0		0		0		0		0		127.1
CCC and lower	50.2		0		0		0		0		0		0		50.2
Total fair value	$	3,473.8	$	1,912.1	$	545.4	$	2,607.4	$	912.0	$	203.5	$	782.0	$	10,436.2

During the first quarter 2021, we took advantage of attractive credit spreads prevailing in the market and increased the size of our corporate bond portfolio. As credit spreads narrowed later in the quarter, we sold some positions since we believed the risk/reward for holding the positions was no longer justified.

Overall, our corporate securities are a larger percentage of the fixed-income portfolio, compared to the end of 2020. At March 31, 2021, the portfolio was approximately 24.4% of our fixed-income portfolio, compared to approximately 23.4% at December 31, 2020. We increased the size of this portfolio based on our expectation that supportive fiscal and monetary policy would create an environment that would be conducive to further compression in credit spreads. In addition, we shortened our duration during the quarter to 3.7 years at March 31, 2021, compared to 3.8 years at December 31, 2020.

49

PREFERRED STOCKS – REDEEMABLE AND NONREDEEMABLE

The table below shows the exposure break-down by sector and rating at March 31, 2021:

Preferred Stocks (at March 31, 2021)
	Financial Services
(millions) Rating	U.S. Banks		Foreign Banks		Insurance		Other		Industrials		Utilities		Total
A	$	50.0	$	0	$	0	$	9.8	$	0	$	0	$	59.8
BBB	937.1		0		145.4		45.5		127.5		11.4		1,266.9
Non-investment grade/non-rated:
BB	144.6		106.7		0		0		25.2		41.9		318.4
Non-rated	0		0		0		35.0		16.6		0		51.6
Total fair value	$	1,131.7	$	106.7	$	145.4	$	90.3	$	169.3	$	53.3	$	1,696.7

The majority of our 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 of our preferred securities is calculated to reflect the call, floor, and floating-rate features. Although a preferred security will remain outstanding if not called, its interest rate duration will reflect the variable nature of the dividend. Our non-investment-grade preferred stocks were all with issuers that maintain investment-grade senior debt ratings.

We also face the risk that dividend payments on our preferred stock holdings could be deferred for one or more periods or skipped entirely. As of March 31, 2021, all of our preferred securities continued to pay their dividends in full and on time. Approximately 81% of our preferred stock securities pay dividends that have tax preferential characteristics, while the balance pay dividends that are fully taxable.

During the first quarter 2021, our preferred stock portfolio had a slight negative return as their high level of income was not able to offset declines in price due to higher rates.

Common Equities

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

($ in millions)	March 31, 2021				March 31, 2020				December 31, 2020
Common stocks	$	4,555.3	99.9	%	$	2,607.8	100.0	%	$	4,049.9	99.9	%
Other risk investments	3.2		0.1		0.3		0		3.1		0.1
Total common equities	$	4,558.5	100.0	%	$	2,608.1	100.0	%	$	4,053.0	100.0	%

The majority of our common stock portfolio is an indexed portfolio, which consists of individual holdings selected based on their contribution to the correlation with the Russell 1000 Index. We held 859 out of 1,023, or 84%, of the common stocks comprising the index at March 31, 2021, which made up 96% of the total market capitalization of the index. At March 31, 2021 and 2020, and December 31, 2020, the year-to-date total return, based on GAAP income, was within our targeted tracking error, which is +/- 50 basis points. In addition to the indexed portfolio, our common stock portfolio includes other common stocks we may hold, including one of our preferred stock holdings that went public as a common stock toward the end of 2020 and recognized a significant increase in value following the public offering.

The other risk investments consist of limited partnership interests. During the first quarter 2021, we funded $0.1 million on a partnership investment and have an open funding commitment of $7.1 million at March 31, 2021 on this investment.

50

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,” 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 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;

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

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

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

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

•whether we adjust claims accurately;

•our ability to maintain a recognized and trusted brand;

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

•compliance with complex laws and regulations;

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

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

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

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

•our continued ability to send and accept electronic payments;

•the possible impairment of our goodwill or intangible assets;

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

•the potential elimination of, or change in, the London Interbank Offered Rate;

•our continued ability to access our cash accounts and/or convert securities 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;

•limitations on our ability to pay dividends on our common shares under the terms of our outstanding preferred shares;

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

•evaluations 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;

•impacts from the outbreak of the novel coronavirus, or COVID-19, and the restrictions put in place to help slow and/or stop the spread of the virus; 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, 2020.

In addition, investors should be aware that generally accepted accounting principles 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.

51

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 3.1 years at March 31, 2021, 3.0 years at March 31, 2020, and 2.9 years at December 31, 2020. The weighted average beta of the equity portfolio was 1.12 at March 31, 2021, 1.00 at March 31, 2020, and 1.09 at December 31, 2020. 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, 2020.

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.

52

PART II—OTHER INFORMATION

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, 2020.

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

(c) Share Repurchases

ISSUER PURCHASES OF EQUITY SECURITIES
2021 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
January	337,475	$	95.55	2,424,999	22,575,001
February	595,906	87.74		3,020,905	21,979,095
March	3,109	87.30		3,024,014	21,975,986
Total	936,490	$	90.55

In May 2019, the Board of Directors approved an authorization for the Company to repurchase up to 25 million of its common shares. This authorization does not have an expiration date. Share repurchases under this authorization may be accomplished through open market purchases, through privately negotiated transactions, pursuant to our equity incentive awards, or otherwise, and may include trading plans entered into with one or more brokerage firms in accordance with Rule 10b5-1 under the Securities Exchange Act of 1934. During the first quarter 2021, all repurchases were accomplished in conjunction with our equity incentive awards or through the open market at the then-current market prices. 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 underleveraged capital.

Item 5. Other 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. The letter is also posted on Progressive’s website at progressive.com/annualreport.

Item 6. Exhibits.

See exhibit index beginning on page 55.

53

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:	May 4, 2021	By: /s/ John P. Sauerland
		John P. Sauerland
		Vice President and Chief Financial Officer

54

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	10.1	Form of Restricted Stock Unit Award Agreement for 2021 Time-Based Awards under The Progressive Corporation 2015 Equity Incentive Plan (for 2021)	Current Report on Form 8-K (filed March 25, 2021; Exhibit 10.1 therein)
10	10.2	Form of Restricted Stock Unit Award Agreement for 2021 Performance-Based Awards (Performance Versus Market) under The Progressive Corporation 2015 Equity Incentive Plan (for 2021)	Current Report on Form 8-K (filed March 25, 2021; Exhibit 10.2 therein)
10	10.3	Form of Restricted Stock Unit Award Agreement for 2021 Performance-Based Awards (Investment Results) under The Progressive Corporation 2015 Equity Incentive Plan (for 2021)	Current Report on Form 8-K (filed March 25, 2021; Exhibit 10.3 therein)
10	10.4	The Progressive Corporation Executive Separation Allowance Plan (2021 Amendment and Restatement)	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
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	104	Cover Page Interactive Data File (the cover page tags are embedded within the Inline XBRL document)	Filed herewith

55

EX-10.4

Exhibit 10.4

THE PROGRESSIVE CORPORATION

EXECUTIVE SEPARATION ALLOWANCE PLAN

    (2021 AMENDMENT AND RESTATEMENT)

WHEREAS, The Progressive Corporation Executive Separation Allowance Plan (“Plan”) is currently maintained pursuant to a 2017 Amendment and Restatement and two amendments thereto; and

WHEREAS, it is deemed desirable to amend and restate the Plan;

NOW THEREFORE, effective March 5, 2021, the Plan is hereby amended and restated as set forth below:

SECTION 1 – DEFINITIONS

1.1    “2015 Plan” means The Progressive Corporation 2015 Equity Incentive Plan, as such plan may be in effect from time to time.

1.2    “Affiliated Company” means any entity in which the Company owns, directly or indirectly, more than fifty percent (50%) of the stock or ownership interests.

1.3     “Applicable Group Insurance Plan”, as to each Eligible Employee, means any employee benefit plan (including, but not limited to, The Progressive Health, Life and Disability Benefits Plan) in which the Eligible Employee is eligible to participate and which provides medical, dental, vision, life or disability coverage, as such plan may be in effect from time to time.

1.4    “ARX Company” means ARX Holding Corp. and any entity in which ARX Holding Corp. owns, directly or indirectly, more than fifty percent (50%) of the stock or ownership interests, including but not limited to American Strategic Insurance Corp. and e-INS, LLC.

1.5    “Cause” (a) before a Change in Control means (i) an Eligible Employee’s violation of Progressive’s Code of Business Conduct and Ethics, provided that such violation would entitle the Company to terminate the Eligible Employee’s employment under the Company’s customary Code of Business Conduct and Ethics enforcement procedures or (ii) an Eligible Employee’s failure to meet written job objectives, provided that such failure would entitle the Company to terminate the Eligible Employee’s employment under the Company’s customary performance management procedures; and (b) after a Change in Control has the meaning given to that term in the 2015 Plan.

1.6    “Change in Control” has the meaning given to that term in the 2015 Plan.

-1-

1.7    “Code” means the Internal Revenue Code of 1986, as amended.

1.8    “Company” means The Progressive Corporation, an Ohio corporation, or its successors.

1.9     “Compensation” as to each Eligible Employee means his/her rate of base salary or other base wages immediately prior to his/her Separation Date. This term does not include overtime pay, shift differentials, other pay differentials, Gainsharing, bonuses or other annual cash incentive payments, commissions, stock-based compensation, incentive compensation, separate pay adjustments or allowances or any other forms of remuneration.

1.10    “Eligible Employee” means a regular, non-temporary employee of a Participating Employer who is eligible to receive annual restricted stock units or other annual stock-based awards under the 2015 Plan or any similar plan as determined by the Company, or whose annual compensation within the meaning of Section 401(a)(17) of the Code exceeds the maximum amount allowed under such Code Section. Notwithstanding anything in the Plan to the contrary, Eligible Employees shall not include (i) any person classified by a Participating Employer or any Affiliated Company as an independent contractor or as an employee of an entity other than a Participating Employer (ii) any person whose terms and conditions of employment are governed by a collective bargaining agreement, (iii) any person who receives a one-time restricted stock unit award or other stock-based award under the 2015 Plan or any similar plan, but who is not eligible to receive regular, annual restricted stock unit awards or other stock-based awards under the 2015 Plan or any similar plan, (iv) the Company's Chairman of the Board at any time that he or she is an employee of the Company but is not also acting as the Company's Chief Executive Officer, or (v) any person who resides and works in a country other than the United States.

1.11    “executive officer” means an Eligible Employee who is required to file reports with the Securities Exchange Commission under Section 16 of the Securities Exchange Act of 1934, as amended.

1.12    “Good Reason” has the meaning given that term in the 2015 Plan.

1.13    “Grade Level” shall mean the grade level assigned by Progressive to the position held by an Eligible Employee immediately prior to termination of employment or Job Change.

1.14     “Job Change” means any change in an Eligible Employee’s job duties that is deemed significant by the Company in its sole and absolute discretion. No determination by the Company as to the significance of any such change shall be deemed a precedent or shall limit in any way the Company’s sole and absolute discretion in deciding whether any change in any Eligible Employee’s job duties is significant.

1.15    “Other Compensation Agreements” means policies, plans, understandings, arrangements, individual employment agreements, termination agreements, severance agreements and

-2-

any other agreements regarding separation allowances, severance pay and/or similar compensation payable by Progressive or a Participating Employer to terminated Eligible Employees. Notwithstanding the foregoing, Other Compensation Agreements do not include the 2015 Plan, (as previously or hereafter amended), any similar plan as determined by the Company and any award agreement representing restricted stock units, stock options or any other award under any of those plans.

1.16    “Participating Employer” shall mean each Affiliated Company that employs one or more individuals and classifies them as its employees for payroll tax purposes, and that either (a) was an Affiliated Company as of March 5, 2021, or (b) becomes an Affiliated Company on or after March 6, 2021, and elects to participate in the Plan in accordance with Section 11.

1.17    “Plan” means The Progressive Corporation Executive Separation Allowance Plan (2017 Amendment and Restatement), as set forth herein and as the same may be amended from time to time.

1.18    “Plan Administrator” shall mean Progressive Casualty Insurance Company (“PCIC”).

1.19    “Progressive” includes the Company and any other entity which from time to time is a Participating Employer.

1.20    “Separation Agreement and General Release” means an agreement and release substantially in the form attached hereto as Exhibit A.

1.21    “Separation Date” means the effective date of any Eligible Employee’s termination of employment or resignation due to a Job Change or, after a Change in Control, resignation for Good Reason.

1.22    “Years of Service” as to each Eligible Employee means the period of time beginning on his/her most recent date of hire by a Participating Employer and ending on his/her most recent Separation Date. However, Years of Service shall not include any time during which an Eligible Employee has received long-term disability benefits under the Applicable Group Insurance Plan.

SECTION 2 – ENTITLEMENT TO SEPARATION ALLOWANCE

2.1    (a) An Eligible Employee shall be entitled to receive a separation allowance under this Plan if (i) Progressive terminates his/her employment for reasons other than resignation (except as provided in Section 2.1(b) below), retirement, death, disability (except as provided in Section 2.3 below), leave of absence or discharge for Cause, and (ii) the Eligible Employee signs a Separation Agreement and General Release, does not revoke the Separation Agreement and General Release within the seven-day revocation period (if applicable), and returns the Separation Agreement and General Release to the Company

-3-

within forty-five (45) days after the later of the date the Eligible Employee receives the Separation Agreement and General Release and the Eligible Employee’s Separation Date.

    (b) An Eligible Employee shall be entitled to receive a separation allowance under this Plan if (i) the Company gives the Eligible Employee written notice of a Job Change, (ii) the Eligible Employee delivers a written resignation from employment to the Company within such period as the Company shall specify and which resignation is effective as of a date that (A) is acceptable to the Company in its sole and absolute discretion and (B) is no later than January 10 of the calendar year immediately following the calendar year in which the Eligible Employee receives from the Company the written notice of a Job Change pursuant to Section 2.1(b)(i) above, and (iii) the Eligible Employee signs a Separation Agreement and General Release, does not revoke the Separation Agreement and General Release within the seven-day revocation period (if applicable), and returns the Separation Agreement and General Release to the Company within forty-five (45) days after the later of the date the Eligible Employee receives the Separation Agreement and General Release and the resignation effective date determined pursuant to Section 2.1(b)(ii) above.

2.2    In addition, if during the twenty-four (24) month period following a Change in Control, an Eligible Employee terminates his or her employment for Good Reason (as stated in a written notice to Progressive, which must be provided within thirty (30) days after the occurrence of the event(s) giving rise to such Good Reason, and must set forth such Good Reason in reasonable detail and the expected date of termination, which shall be not more than thirty (30) days after the date of such notice), and Progressive fails to cure the event(s) giving rise to the claim of Good Reason within such thirty (30) day period, then upon the occurrence of such termination, the Eligible Employee shall be entitled to a separation allowance under this Plan if the Eligible Employee signs a Separation Agreement and General Release and returns it to the Company within forty-five (45) days after the Eligible Employee’s Separation Date.

2.3    Notwithstanding the preceding provisions of this Section 2, no Eligible Employee shall be entitled to receive a separation allowance if he/she is on a medical or other leave of absence, except for an Eligible Employee who, on his or her Separation Date, is receiving long-term disability benefits under the Applicable Group Insurance Plan or is on a qualifying leave pursuant to the Family and Medical Leave Act, the Uniformed Services Employment and Reemployment Rights Act, or any other local, state or federal law pursuant to which the Eligible Employee has a lawful right to a separation allowance upon termination of employment or resignation due to a Job Change or, after a Change in Control, resignation for Good Reason.

2.4    Notwithstanding anything in this Plan to the contrary, an Eligible Employee shall not be entitled to receive a separation allowance, and any Separation Agreement and General Release that such Eligible Employee previously may have executed shall be considered null and void, if, at any time prior to payment of a separation allowance to such Eligible Employee, the Company determines that the Eligible Employee has at any time prior to such payment committed a violation of Progressive’s Code of Business Conduct and

-4-

Ethics that would have entitled Progressive to terminate the Eligible Employee’s employment in accordance with Progressive’s then current disciplinary practices with respect to the type of violation in question had the Eligible Employee still been actively employed. The provisions of this Section 2.4 shall cease to be effective immediately upon the occurrence of a Change in Control. The preceding provisions of this Section 2.4 shall not in any way affect the Company’s right to terminate an employee’s employment for Cause following a Change in Control.

2.5 Each Eligible Employee who is entitled to a separation allowance under the preceding provisions of this Section shall be entitled to participate in outplacement benefits at the Company’s expense and in the form and manner made available by the Company pursuant to the Company’s outplacement benefits program then in effect, if any, or in any other such form and manner as the Company may elect. An Eligible Employee’s participation in outplacement benefits shall be subject to the following restrictions: (a) the receipt of outplacement benefits during any calendar year shall not affect an Eligible Employee’s right to such benefits during any other calendar year; and (b) the Company shall not make any payment for outplacement services after the last day of the second calendar year following the calendar year in which the Eligible Employee’s Separation Date occurs.

2.6    Notwithstanding anything in this Plan to the contrary, if Progressive sells or transfers substantially all of a business unit, division, geographic operation, product or product line, or any combination thereof (a “Disposed Operation”) to a third party, and if an Eligible Employee who provides services to such Disposed Operation is offered or accepts any type of employment with such third party as of or following consummation of such sale or transfer, then such Eligible Employee shall not be entitled to receive a separation allowance or any other benefit under this Plan. The provisions of this Section 2.6 shall not apply to any transaction that constitutes, or that occurs after, a Change in Control.

SECTION 3 – AMOUNT OF SEPARATION ALLOWANCE

3.1    Subject to Section 5.2, the separation allowance payable to each Eligible Employee who is entitled to such allowance under Section 2 above shall be equal to the number of weeks of Compensation set forth in the table below, based on the Eligible Employee’s Grade Level and Years of Service as of his/her Separation Date:

-5-

Eligible Employees at Grade Levels 47 through 49	26 weeks of Compensation plus two additional weeks of Compensation for each full Year of Service in excess of 13 Years of Service, not to exceed an aggregate of 52 weeks of Compensation
(1) Eligible Employees at Grade Level 50 through 53 or GNG, and (2) any other Eligible Employee who is designated in writing by (i) the Compensation Committee of the Company’s Board of Directors, if the Eligible Employee is an executive officer, or (ii) the Company’s Chief Executive Officer and/or Chief Human Resources Officer, if the Eligible Employee is not an executive officer.	52 weeks of Compensation
(1) The Company’s Chief Executive Officer; (2) Eligible Employees at Grade Level ENG; and (3) any other Eligible Employee designated in writing by (i) the Compensation Committee of the Company’s Board of Directors, if the Eligible Employee is an executive officer, or (ii) the Company’s Chief Executive Officer and Chief Human Resources Officer, if the Eligible Employee is not an executive officer.	•    Less than one Year of Service: 52 weeks of Compensation •    At least one, but less than two, Years of Service: 104 weeks of Compensation •    At least two Years of Service: 156 weeks of Compensation

3.2    Each Eligible Employee’s separation allowance shall be paid in a lump sum within thirty (30) days following the later of (i) the Eligible Employee’s Separation Date, or (ii) the expiration of the revocation period referred to in the Eligible Employee’s signed Separation Agreement and General Release. In no event, however, shall an Eligible Employee’s separation allowance be paid later than March 15 of the year following the year in which the Eligible Employee’s Separation Date occurs.

3.3    Progressive shall withhold from each separation allowance all applicable federal, state, and local taxes, Social Security taxes and other deductions required by law, and any other amounts due to Progressive from the Eligible Employee for any reason.

3.4    Each Eligible Employee’s separation allowance payable under this Plan shall be reduced by the amount of any state-mandated separation allowance or severance payments payable by Progressive to such Eligible Employee.

-6-

3.5    Notwithstanding anything herein to the contrary, no separation allowance payments shall be made under this Plan to any Eligible Employee later than two and one-half months following (i) the end of the year in which the Eligible Employee’s Separation Date occurs, or (ii) if earlier, the end of the year in which the Eligible Employee receives a written notice from the Company pursuant to Section 2.1(b)(i) above.

3.6    Each separation allowance payable under this Plan to an Eligible Employee who is affected by a “plant closing” or “mass layoff” within the meaning of the Worker Adjustment and Retraining Notification Act (29 U.S.C. §§2101-2109) (“WARN”) shall be reduced by the amount of salary or other wages paid by Progressive to such Eligible Employee in respect of the period (“WARN Period”) commencing on the date he/she receives written notice pursuant to WARN that Progressive will be terminating his/her employment and ending on his/her Separation Date, but only to the extent that the Eligible Employee has not earned wages from Progressive during such WARN Period.

3.7    An Eligible Employee who receives a separation allowance under this Plan shall be obligated to repay a portion of that separation allowance if he/she is hired by a Participating Employer as a regular employee within a period of time following his/her Separation Date that does not exceed the number of weeks of Compensation used in computing his/her separation allowance under Section 3.1. The amount of the repayment shall equal the difference between (a) the total separation allowance paid to the Eligible Employee and (b) the total separation allowance paid to the Eligible Employee multiplied by a fraction, the numerator of which is the number of weeks, rounded to the nearest whole week, beginning on the Eligible Employee’s Separation Date and ending on his/her rehire date, and the denominator of which is the total number of weeks of Compensation used in computing his/her separation allowance under Section 3.1. Repayment shall be made at such time and in such manner as shall be determined by the Participating Employer which hires the Eligible Employee, in such Participating Employer’s sole discretion.

SECTION 4 – CONTINUED WELFARE BENEFITS

4.1    An Eligible Employee who resigns or whose employment has been terminated under the Plan may elect to continue his/her and his/her dependents' medical, dental and vision coverages, if any, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), as further provided in the Applicable Group Insurance Plan (to the extent he/she and his/her dependents were receiving such coverages immediately prior to his/her Separation Date), for the period specified in the Applicable Group Insurance Plan and subject to the terms and conditions thereof. If an Eligible Employee who is entitled to a separation allowance under the preceding provisions of this Plan elects to continue his/her and/or his/her dependents' medical, dental and/or vision coverages under the Applicable Group Insurance Plan, the Eligible Employee will be entitled to receive such coverages at the contribution amount set forth in the Applicable Group Insurance Plan (referred to therein as the “Separation Allowance Contribution”) for a period not to

-7-

exceed the lesser of (i) the COBRA continued coverage period or (ii) the number of weeks of Compensation used in computing the amount of his/her separation allowance under Section 3.1 above, provided that the Eligible Employee pays such Separation Allowance Contribution to the Participating Employer at such times as the Participating Employer shall specify. Eligible Employees may also qualify for a reduction of the Separation Allowance Contribution under the American Recovery and Reinvestment Act of 2009.

4.2    Notwithstanding the foregoing, if the Company reasonably determines that, as a result of the continuation of coverage pursuant to this Section 4, Progressive, an Applicable Group Insurance Plan, or an Eligible Employee could be subject to: (a) any excise tax for failure to comply with any law applicable to group health plans; or (b) the taxation of any medical expense reimbursement benefits provided under an Applicable Group Insurance Plan, the Company shall require an Eligible Employee to pay the full cost of the continuation of coverage in lieu of the Separation Allowance Contribution.

SECTION 5 – ELIGIBILITY UNDER OTHER PLANS AND AGREEMENTS

5.1    This Plan entirely supersedes and replaces all Other Compensation Agreements adopted or entered into before March 5, 2021, except (i) with respect to any Eligible Employee who has incurred a Separation Date prior to March 5, 2021.

5.2    Each separation allowance payment payable under this Plan to an Eligible Employee shall be reduced, potentially down to zero, by any amount payable under any Other Compensation Agreement that has been or is entered into between (i) an ARX Company or any other entity whose stock or assets have been acquired, directly or indirectly, by Progressive (through merger, purchase or otherwise) during or after 2015 and (ii) an Eligible Employee.

SECTION 6 – CLAIMS PROCEDURES

6.1    Benefits Claim.

    (a)    The Plan Administrator is responsible for evaluating all benefits claims under the Plan, and shall establish reasonable procedures under which a claimant, or his/her duly authorized representative, may present a claim for benefits under this Plan.

    (b)    Unless such claim is allowed in full by the Plan Administrator, written notice of the denial shall be furnished to the claimant within ninety (90) days of receipt (which may be extended by a period not to exceed an additional ninety (90) days if special circumstances so require and written notice to the claimant is given prior to the expiration of the initial ninety (90) day period describing such circumstances and indicating the date by which the Plan Administrator expects to render its determination) setting forth the following in a manner calculated to be understood by the claimant:

(i)     The specific reason(s) for the denial;

-8-

(ii)    Specific references(s) to any pertinent provision(s) of the Plan or rules promulgated pursuant thereto on which the denial is based;

(iii)    A description of any additional information or material as may be necessary to perfect the claim, together with an explanation of why it is necessary;

(iv)    A description of the Plan’s claims review procedures and the time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under Section 502(a) of ERISA following an adverse benefit determination on review; and

(v)    An explanation of the steps to be taken if the claimant wishes to resubmit         his/her claim for review.

6.2    Appealing a Denied Claim.

    (a)    Within a reasonable period of time after the denial of the claim, but in any event, not to be more than sixty (60) days thereafter, the claimant or his/her duly authorized representative may make written application to the Plan Administrator for a review of such denial. The claimant or his/her representative, may, upon request and free of charge, review or receive copies of documents, records and other information relevant to the claimant’s claim for benefits, and may submit written comments, documents, records and other information relating to the claim for benefits.

(b)    If an appeal is timely filed, the Plan Administrator shall conduct a full and fair review of the claim and mail or deliver to the claimant its written decision within sixty (60) days after receipt of the claimant’s request for review (which may be extended by a period not to exceed an additional sixty (60) days if special circumstances or a hearing so require and written notice is given to the claimant prior to the expiration of the initial sixty (60) day period describing such special circumstances and indicating the date by which the Plan Administrator expects to render its determination). In conducting its review, the Plan Administrator shall take into account all comments, documents, records and other information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. The Plan Administrator’s decision on review shall:

(i)    Be written in a manner calculated to be understood by the claimant;

(ii)    State the specific reason(s) for the decision;

(iii)    Make specific reference to pertinent provision(s) of the Plan;

-9-

(iv)    State that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to the claimant’s claim for benefits; and

(v)Include a statement of the claimant’s right to bring a civil action under Section 502(a) of ERISA.

6.3    If a period of time is extended, as permitted under Sections 6.1(b) and 6.2(b) above, due to a claimant’s failure to submit information to decide a claim, the period for making the benefit determination on review shall be tolled from the date on which the notification of the extension is sent to the claimant until the date on which the claimant responds to the request for additional information.

6.4    Legal Action. No legal action with respect to the Plan, or any benefits thereunder, may be brought later than: (a) one year after the Plan Administrator’s decision on your appeal; or, if earlier, (b) three years from the date your eligibility for any separation allowance benefit was first denied.

6.5    Venue Restriction. A Participant or Beneficiary shall only bring an action in connection with the Plan in the United States District Court Northern District of Ohio.

SECTION 7 – AMENDMENT AND TERMINATION

7.1    The Company, by action of the Compensation Committee of its Board of Directors, may amend, modify or terminate the Plan in whole or in part at any time for any reason without the consent of any Affiliated Company or any employee or other person; provided, however, that, except for legally required amendments, modifications and terminations, no such amendment, modification or termination shall impair the rights of any Eligible Employee who incurs a Separation Date prior to the date the Company adopts such amendment or modification or approves such termination.

7.2    Notwithstanding the provisions of Section 7.1, the Company may, by action of its Chief Legal Officer, modify or amend the Executive Separation Agreement and General Release at any time, without action of the Compensation Committee of its Board of Directors or any Affiliated Company or any other person, to (i) respond to developments in applicable law, (ii) reflect changes to the names of benefit plans provided by the Company and referenced in the Plan, or (iii) conform such document to the terms of the Plan. Additionally, with the exception of the Separation Agreement and Release of any Eligible Employee who immediately prior to, or within ninety (90) days of, such individual’s Separation Date was an executive officer of the Company, the Company may, by action of its Chief Legal Officer, modify or amend the Separation Agreement and General Release at any time in response to conform to developments in the Company’s employment practices, or to clarify the intent of an existing provision of the Separation Agreement and General Release, without action of the Compensation Committee of its Board of Directors or any Affiliated Company or any other person.

-10-

7.3    Notwithstanding the provisions of Sections 7.1 and 7.2, in the event of the occurrence of a Change in Control, until after the third anniversary of the date such Change in Control occurred, neither the Plan nor the Executive Separation Agreement and General Release may be amended, modified or terminated in a way that impairs or reduces any of the rights or benefits of any individual who was an Eligible Employee immediately prior to, or within ninety (90) days prior to, such Change in Control.

SECTION 8 – RIGHTS OF SETOFF

8.1    Progressive shall have the unrestricted right and power to set off against, or recover out of, any payments owed an Eligible Employee or other person under this Plan, at the time such payments would have otherwise been payable under this Plan, any amounts owed to Progressive by such Eligible Employee or other person.

SECTION 9 – FUNDING

9.1    All payments pursuant to this Plan shall be made from Progressive's general funds and nothing contained herein shall be deemed to require Progressive to, and Progressive shall not, physically segregate any sums from its general funds, or create any trust or escrow account, or make any special deposit, in respect of any amounts payable hereunder.

SECTION 10 – ADMINISTRATION

10.1    PCIC shall be the “plan administrator” and shall be the “named fiduciary” within the meaning of Section 402 of the Employee Retirement Income Security Act of 1974, as amended. Except as specified elsewhere herein, the Plan Administrator shall exercise all rights and duties with respect hereto, including, without limitation, the right:

(i)    to make and enforce such rules and regulations as are necessary or proper for the efficient administration of this Plan; and

(ii)    to interpret and construe this Plan and to decide all disputes and other matters arising hereunder, including but not limited to the right to determine eligibility for benefits and resolve possible ambiguities, inconsistencies or omissions. All such rules, interpretations and decisions shall be applied in a uniform manner to all persons similarly situated.

Except as otherwise specifically provided herein, no action or decision taken in accordance with this Plan by the Plan Administrator or Progressive shall be relied upon as a precedent for any similar action or decision under any circumstances.

10.2    It is intended that all amounts payable under this Plan shall be, to the greatest extent possible, either “short-term deferral” or “separation pay” within the meaning of Treasury Regulation Sections 1.409A-1(b)(4) and 1.409A-1(b)(9) respectively and, as such, shall

-11-

be exempt from the application of Section 409A of the Code. The Plan, the Separation Agreement and General Release, and any other documents relating to the payment of separation allowance or the provision of benefits hereunder shall be construed and interpreted in accordance with such intention. Notwithstanding the foregoing, the Company makes no representations that any separation allowance payment shall comply with Section 409A and in no event shall the Company be liable for all or any portion of any taxes, penalties, interest or other expenses that may be incurred by an Eligible Employee on account of noncompliance with Section 409A of the Code.

SECTION 11 – ADOPTION OF THE PLAN BY AFFILIATED COMPANIES

11.1    Adoption with Approval

    Any Affiliated Company may adopt and become a party to this Plan with the consent of the Company and subject to such terms and conditions as the Company may require or approve.

11.2    Procedure for Adoption

    An Affiliated Company may adopt the Plan and become a Participating Employer hereunder by executing an instrument in writing evidencing such adoption by its Board of Directors and filing a copy thereof with the Company. Upon approval of the Affiliated Company's adoption of the Plan by the Company, the Affiliated Company's adoption of the Plan shall be effective as of the date specified in said instruments.

11.3    Effect of Adoption

    (a)    If there is more than one Participating Employer hereunder, the costs and expenses in connection with the Plan each year shall be shared by all Participating Employers in such manner as the Company determines.

    (b)    Each Participating Employer, as a condition of continued participation in this Plan, delegates to the Company the sole power and authority to design, establish and change the Plan, including, without limitation, the power and authority to:

        (i)    determine the amount of employer and employee contributions

    (ii)    consent to the adoption of this Plan by other Affiliated Companies; and

        (iii)    amend or terminate the Plan in accordance with Section 7.

    (c)    Each Participating Employer, as a condition of continued participation in this Plan, delegates to the Company the sole power and authority to administer and operate the Plan as provided in Section 10 of the Plan.

11.4    Termination of Adoption

-12-

    Each Participating Employer may elect separately to withdraw from the Plan, but amendments may be made only by the Company as provided in Section 7. Any such withdrawal shall be expressed in an instrument in writing executed by the withdrawing Participating Employer on order of its Board of Directors and filed with the Company.

SECTION 12 – EFFECTIVE DATE

12.1    This Plan shall be effective March 5, 2021, but only as to Eligible Employees who incur Separation Dates on or after such date.

IN WITNESS WHEREOF, the Company has hereunto caused this Amendment and Restatement to be executed by its duly authorized representative as of the 5th day of March, 2021.

THE PROGRESSIVE CORPORATION

BY: /s/ Daniel P. Mascaro

TITLE: Secretary

-13-

EXHIBIT A

EXECUTIVE SEPARATION AGREEMENT AND GENERAL RELEASE

THIS AGREEMENT is entered into by and between you («Name») and Progressive «PayrollCompany» (“Progressive”), together with its parents, subsidiaries, affiliates, predecessors, successors and assigns (collectively, with Progressive, the “Progressive Group”), pursuant to The Progressive Corporation Executive Separation Allowance Plan (“Plan”).

    WHEREAS, your employment with Progressive ended effective «TermDate» (the “Separation Date”); and

    WHEREAS, you desire to receive certain separation allowance benefits under the Plan; and

    WHEREAS, the Plan provides separation allowance benefits only to employees who sign a Separation Agreement and General Release in the form specified in the Plan;

    NOW, THEREFORE, you and the Progressive Group agree as follows:

1.Final Wages and PTO/ETB Payment. Progressive shall pay you for all hours of work performed and for all credited but unused Earned Time Benefit hours determined as of your Separation Date in accordance with Progressive’s standard practices. These payments will be made within thirty (30) days of the Separation Date, or at such earlier time as may be required by law, regardless of whether you accept this Agreement.

2.Severance Benefits. In consideration of your acceptance of this Agreement and subject to your fully meeting your obligations under it, Progressive will provide you with following severance pay and benefits:

a.Progressive shall pay you a separation allowance in the total gross amount of «SepText» Dollars ($«SepNo») (representing «sevwks» weeks of Compensation), less applicable tax withholding, other legally required deductions and (except to the extent prohibited by law) amounts due Progressive for any reason. Such separation allowance shall be paid in a lump sum at the time specified in Section 3.2 of the Plan and subject to the limitations specified in the Plan.

b.If you are participating in The Progressive Health, Life and Disability Benefits Plan (“Group Insurance Plan”), you may elect to continue your and your dependents’ medical, dental and vision coverages under the Group Insurance Plan for the periods specified in the Group Insurance Plan, subject to the terms, conditions and limitations of the Group Insurance Plan. If you elect to continue any of such coverages, Progressive shall pay the cost of continuing such coverages for a period not to exceed the number of weeks of Compensation used in computing the amount of your separation allowance under Paragraph 1 above, provided that you make payments at such times as and in such manner as Progressive shall specify equal to the contributions you would have had to make for those coverages for such period had you continued to receive those coverages as an active employee during such period, all as determined by Progressive. You

-1-

also shall be entitled to the conversion privileges, if any, applicable to your life insurance and/or other coverages under the Group Insurance Plan.

c.Progressive shall make outplacement services available to you for a period of [ ] months, in accordance with Section 2.5 of the Plan.

d.If you are rehired by Progressive or any other Participating Employer as a regular employee within a period of time following your Separation Date that does not exceed the number of weeks of Compensation used in computing your separation allowance under the Plan, you shall repay to Progressive the amount specified in Section 3.7 of the Plan at the time and in the manner specified therein.

e.[DELETE IF SEPARATION DATE IS AFTER CHANGE OF CONTROL.] You shall not be entitled to receive the severance pay and benefits described above, and this Agreement shall be considered null and void, if, at any time prior to payment to you of a separation allowance, Progressive determines that you have committed a violation of Progressive’s Code of Business Conduct and Ethics that would have led Progressive to terminate your employment in accordance with Progressive’s then current disciplinary practices with respect to the type of violation in question had you still been actively employed.

3.Effect on Equity Incentives.[If not Qualified Retirement] You acknowledge the forfeiture of any and all unvested Restricted Stock Units awarded to you under The Progressive Corporation 2010 Equity Incentive Plan and/or The Progressive Corporation 2015 Equity Incentive Plan, in each case as amended (the “Incentive Plans”), except to the extent stated in any agreement between you and Progressive related to unvested and outstanding performance-based restricted stock unit award(s) for which the Evaluation Period or the Growth Evaluation Period has ended prior to the Separation Date.  Your rights, if any, under The Progressive Corporation Executive Deferred Compensation Plan and/or the Incentive Plans (collectively, the “Executive Compensation Programs”) shall be determined in accordance with the governing provisions of the Executive Compensation Programs as in effect from time to time and any agreements entered into thereunder. For purposes of such Executive Compensation Programs, you shall be considered to have terminated employment with Progressive on the Separation Date.

[If Qualified Retirement] The termination of your employment shall be deemed to be a Qualified Retirement as that term is used in The Progressive Corporation 2015 Equity Incentive Plan, in each case as amended (the “Incentive Plans”), and/or any Restricted Stock Unit Award Agreement between you and Progressive (the “Stock Agreements”), and you shall enjoy such rights and be subject to such forfeitures and requirements as are contained in said Incentive Plans and/or Stock Agreements in accordance with the Incentive Plans and Stock Agreements. Your rights, if any, under The Progressive Corporation Executive Deferred Compensation Plan and/or the Incentive Plans (collectively, the “Executive Compensation Programs”) shall be determined in accordance with the governing provisions of the Executive Compensation Programs as in effect from time to time and any agreements entered into thereunder. For purposes of such Executive Compensation Programs, the Separation Date shall be your Qualified Retirement Date.

-2-

4.Acknowledgment of Full Payment and Status of Benefits. You acknowledge that the payments described in Paragraph 1 of this Agreement are in complete satisfaction of any and all wages and payments due to you from the Progressive Group, whether for services provided or otherwise, through the Separation Date and that, except as expressly provided under this Agreement, no further compensation is owed to you. You further acknowledge that, except as expressly provided in Paragraphs 2(b) and 3 above, your participation in all employee benefit plans and programs will end as of the Separation Date, in accordance with the terms of those plans and programs. You acknowledge that you have no rights under The Progressive Corporation Separation Allowance Plan.

5.Return of Documents and Other Property; Confidentiality; Trade Secrets.

a.You agree to continue to honor your obligations with respect to confidential and/or proprietary information belonging to the Progressive Group, including the Confidentiality Statement to which you agreed upon your hire, if any, and all applicable policies as set forth in Progressive’s Code of Business Conduct and Ethics and Workplace Policies. You affirm and represent that you have not taken or misused any such confidential and/or proprietary information and that you have returned to Progressive any records containing such confidential and/or proprietary information and all records that are the Progressive Group’s property.

b.Notwithstanding anything in this Agreement to the contrary, you and Progressive acknowledge that you shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that is made (i) in confidence to a Federal, State, or local government official, either directly or indirectly, or to an attorney; and (ii) solely for the purpose of reporting or investigating a suspected violation of law. In addition, you shall not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that is made in a complaint or other document filed in a lawsuit or other proceeding, if such filing is made under seal. Furthermore, in the event you file a lawsuit for retaliation by Progressive for reporting a suspected violation of law, you may disclose the trade secret to your attorney and use the trade secret information in the court proceeding, if you file any document containing the trade secret under seal and does not disclose the trade secret, except pursuant to court order.

6.Release of Claims. In exchange for separation allowance and benefits provided to you under this Agreement, to which you would not otherwise be entitled, you, on your own behalf and on behalf of your heirs, executors, agents, representatives, administrators, survivors, assigns and anyone claiming by or through you, hereby release Progressive and the Progressive Group, along with each of their individual and respective current and former directors, officers, agents, attorneys and employees in their corporate as well as personal capacities (collectively, the “Releasees”), from any and all claims, liabilities, demands, actions, suits and causes of action, whether known or unknown, that you ever had or now may have against any of the Releasees, both in law and equity, arising from or relating to (a) your employment with Progressive and/or any other entity of the Progressive Group and/or (b) work or services you performed for or on behalf of Progressive or any other entity of the Progressive Group (collectively, “Claims”). Your

-3-

released Claims include, without limitation: claims arising under the Age Discrimination in Employment Act (“ADEA”), the Fair Labor Standards Act, Title VII of the Civil Rights Act of 1964, the Family and Medical Leave Act, the Americans with Disabilities Act, the National Labor Relations Act, the Uniformed Services Employment and Reemployment Rights Act and the Employee Retirement Income Security Act of 1974, each as may be amended; claims arising under state law [, including [recite any desired state statutes]]; claims for emotional distress and/or mental and/or physical injury; and any other claims relating in any way to your employment with Progressive and/or any other entity of the Progressive Group and its termination.

[If Executive is a California resident, include] You further acknowledge that you have read and understand California Civil code Section 1542, which reads as follows:

“A general release does not extend to claims which the creditor does not know or suspect to exist in «HisHer» favor at the time of executing the release, which if known by him must have materially affected «HisHer» settlement with the debtor.”

You hereby waive the provisions and protections of California Civil code Section 1542 and agree that the above release shall apply to all Claims that you ever had or now may have against the Releasees, regardless of whether you currently are aware of the Claims or suspect that they exist.

[IF EXECUTIVE IS A RESIDENT OF ANY OTHER STATE REQUIRING RECITAL, INCLUDE RECITAL.]

7.No Pending or New Claims. You agree that you will not instigate, initiate, promote or participate in any Claims against Releasees unless required to do so by law, excepting only such Claim(s) as are permitted under Paragraph 11 below.In the event that you do so, the Claim(s) shall be dismissed immediately upon the presentation of this Agreement, and you shall reimburse Releasees for all legal fees and expenses incurred in defending such Claim(s) and obtaining their dismissal.

8.Cooperation. You agree to cooperate with the Progressive Group and/or any entity thereof, as well as any entity operating on its or their behalf, in response to all reasonable requests relating to your former job duties, including requests for such information as the location of documents or information and disclosure of all passwords necessary or desirable to the Progressive Group’s access of information that you password-protected on the information systems or the Progressive Group or any entity thereof. You further agree to cooperate with the Progressive Group and/or any entity thereof, as well as any entity operating on its or their behalf, in connection with any investigation or legal proceeding arising out of matters that were under your responsibility or that were related to, or caused by, your actions.

9.Non-Disparagement. You agree not to disparage the Progressive Group or Releasees, including by libel or defamation. You may, however, provide truthful information to any state or federal administrative agency and in response to formal legal process, such as a subpoena compelling your testimony.

10.Non-Admission. You agree and acknowledge that this Agreement is not and shall not be construed to be, or represented to others as, an admission that Releasees violated any federal, state or local law or regulation or duty owed to you.

-4-

11.Right to Participate in Government Agency Proceedings. Notwithstanding any term or provision of this Agreement to the contrary (including, but not limited to, Paragraphs 5, 6, 7, 8 and 9 above), nothing in this Agreement, in Progressive’s Code of Business Conduct and Ethics and Workplace Policies, or in any other existing agreements between you and Progressive is intended or shall be construed to prohibit you, without notice to Progressive, from filing a charge with, or participating in any investigation or proceeding conducted by, the U.S. Equal Employment Opportunity Commission (or a comparable local, state or federal fair employment practices agency) or the U.S. Occupational Safety and Health Administration, from taking any actions protected by Section 7 of the National Labor Relations Act, from communicating directly with the Securities and Exchange Commission regarding any possible securities law violation, or from communicating with the Occupational Safety and Health Administration regarding a violation of any law it enforces. You acknowledge and agree, however, that, except with respect to any award pursuant to 15 U.S.C. § 78u-6 or any award administered by the U.S. Occupational Safety and Health Administration, this Agreement fully and finally resolves all monetary matters between you and Releasees, and you waive any right to monetary damages, attorneys’ fees, costs, equitable remedies and any other individual relief related to or arising from any such charge, or any ensuing complaint or lawsuit, filed by you or on your behalf.

    12.     Miscellaneous.

a.     Unless defined herein, all capitalized terms used in this Agreement shall have the meanings given to them in the Plan. The captions and headings in this Agreement are for convenience only and do not define or describe the scope or content of any provision of this Agreement.

b.     This Agreement, together with the Plan and the other documents referenced herein, constitutes the entire agreement between the parties and supersedes all prior and contemporaneous oral or written representations, agreements and understandings relating to your employment, its termination and all related matters, excluding only, and subject to Paragraph 11, above, (i) your continuing obligations under Progressive’s Code of Business Conduct and Ethics; (ii) any agreements between you and Progressive that by their terms continue to apply after the termination of your employment, including, but not limited to, agreements regarding your engagement in competitive activities, your solicitation of Progressive employees, your obligations with respect to confidential and/or proprietary information, and the parties’ rights and obligations with respect to inventions; (iii) agreements regarding the initiation and resolution of legal disputes between you and Progressive, including but not limited to agreements to adjudicate claims by binding arbitration and agreements regarding the time period in which claims must be brought; (iv) any other obligations that survive the termination of your employment; and (v) your rights, if any, under the Executive Compensation Programs and any agreements entered into thereunder. Any modifications or assignments of this Agreement must be in a writing signed by you and Progressive’s Chief Legal Officer (or, in the event of a conflict of interest, Progressive’s Chief Financial Officer) in order to be effective. This

-5-

Agreement is subject to the terms, provisions and limitations of the Plan in all respects.

c.     In the event any provision of this Agreement shall be held to be void, unlawful or for any reason unenforceable or otherwise at variance with the intentions of the parties as expressed herein, the remaining portions of the Agreement shall remain in full force and effect. In the event you breach this Agreement or any part of it, or fail to perform your obligations under this Agreement, the Plan or any other agreement relating to your employment that survives this Agreement, Progressive’s obligations hereunder shall terminate but the Agreement otherwise shall remain in full force and effect, including your release of Claims. No waiver of any provision of this Agreement, or the breach thereof, shall be deemed a waiver of any other provision or breach.

d.     This Agreement may be signed in counterparts, each of which shall be deemed an original and all of which, taken together, shall constitute the same instrument, though this Agreement shall be of no force or effect until executed by both you and Progressive. A wet signature on an electronically transmitted copy of the Agreement and/or a wet signature transmitted electronically (i.e., a facsimile or scanned image) shall have the same effect as the original.

e.     This Agreement shall be interpreted, enforced and governed under the laws of the State of Ohio, in which State the Plan was adopted and is maintained.

13.     [INCLUDE IF EXECUTIVE IS 40 OR OVER AND PART OF GROUP (2 OR MORE) REORGANIZATION] Group Impact Attachment. In accordance with the provisions of the Older Workers Benefit Protection Act, attached as Attachment A to this Agreement is statistical information regarding job titles and ages of the employees [whose employment will and will not be terminated and/or who will or will not experience a Job Change] as a result of the [reduction in force and/or reorganization] as of the date below.

    14.     [INCLUDE IF EXECUTIVE IS 40 OR OVER] YOU FURTHER REPRESENT AND ACKNOWLEDGE:

A.The only consideration for signing this Agreement is that stated expressly herein. No person or entity has made other promises or agreements of any kind to cause you to sign this Agreement.

B.You fully understand the meaning and intent of this Agreement. You have read the Agreement carefully, know its contents, understand its terms, their meaning and their effect upon your rights and duties. You enter into this Agreement knowingly and voluntarily, agree to all its terms and conditions, understand their final and binding effect, and sign THIS Agreement as your own free act with the full intent of releasing Releasees from all claims AS PROVIDED IN THIS AGREEMENT.

-6-

C.THIS AGREEMENT DOES NOT WAIVE OR RELEASE ANY RIGHTS OR CLAIMS YOU MAY HAVE UNDER the ADEA THAT ARISE AFTER THE DATE YOU SIGN THIS AGREEMENT.

D.The consideration provided to you under THIS AGREEMENT is in addition to anything of value to which you are entitled already.

E.You have been advised by Progressive to consult with an attorney prior to executing this Agreement.

[INCLUDE IF EXECUTIVE IS 40 OR OVER] IMPORTANT! You have 45 days from either your Separation Date or the date you received this Agreement (whichever is later) within which to consider this Agreement, sign it, and return it to Progressive. If you do not meet this deadline, you will not be eligible for a separation allowance. You may revoke the Agreement within seven days after signing it, but you must do so by delivering written notification of such revocation to Progressive’s Chief Legal Officer at 6300 Wilson Mills Road, Mayfield Village, Ohio, 44143. If you sign and return the Agreement within the applicable 45-day deadline and do not revoke it, it will become effective immediately following the expiration of the seven-day revocation period.

[INCLUDE IF EXECUTIVE IS UNDER 40] IMPORTANT! You have 45 days from either your Separation Date or the date you received this Agreement (whichever is later) within which to consider this Agreement, sign it, and return it to Progressive. This Agreement will become effective once you sign it. If you do not meet the 45-day deadline, you will not be eligible for a separation allowance.

Date this Agreement was Given to You

                        ________________________________________

                        By:    _________________     __________

                            HR/Manager Initials        Date

                        PROGRESSIVE «PayrollCompany»

                        By: ______________________________________

                        __________________________________________

                        Printed Name

                        Title: _____________________________________

-7-

I understand this Agreement and enter into it of my own free will. I understand that Progressive will not be required to provide any severance benefits under this Agreement until after this Agreement becomes effective.

______________________________        Date: ______________________________

[Name]

-8-

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Susan Patricia Griffith, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of The Progressive Corporation;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 4, 2021                 

/s/ Susan Patricia Griffith

                            Susan Patricia Griffith

President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, John P. Sauerland, certify that:

1.    I have reviewed this quarterly report on Form 10-Q of The Progressive Corporation;

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 4, 2021

/s/ John P. Sauerland

                            John P. Sauerland

                            Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

SECTION 1350 CERTIFICATION

    I, Susan Patricia Griffith, President and Chief Executive Officer of The Progressive Corporation (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1) the Quarterly Report on Form 10-Q of the Company for the period ended March 31, 2021 (the “Report”), which this certification accompanies, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2) information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Susan Patricia Griffith

Susan Patricia Griffith

President and Chief Executive Officer

May 4, 2021

EX-32.2

Exhibit 32.2

SECTION 1350 CERTIFICATION

    I, John P. Sauerland, Chief Financial Officer of The Progressive Corporation (the “Company”), certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that:

(1) the Quarterly Report on Form 10-Q of the Company for the period ended March 31, 2021 (the “Report”), which this certification accompanies, fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(2) information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ John P. Sauerland

John P. Sauerland

Vice President and Chief Financial Officer

May 4, 2021

EX-99

Exhibit 99

Letter to Shareholders

First Quarter 2021

We closed the first quarter of 2021 with solid growth and profitability. As we crossed the one-year anniversary of the shelter-in-place orders, it should be noted that, starting in March 2021, the year-over-year growth comparisons will be inflated due to the low denominators from the prior year when shopping virtually stalled as the pandemic began. In addition to depressed shopping, miles driven decreased significantly, which impacted our transportation network company (TNC) line of business and resulted in the Commercial Lines business reporting negative premiums written growth in March of last year. On the positive side, growth for the first quarter of 2021 was aided by the third round of stimulus payments, which made March 17, 2021 our second highest Direct auto prospect and sales day ever.

Net premiums written (NPW) growth for the quarter came in at 19%, with a healthy combined ratio (CR) of 89.3. All lines of the business were profitable, with the exception of our Property business, where we continue to be plagued by weather-related losses. Catastrophes during the quarter accounted for 30.6 points on the Property CR.

We continue to have robust unit growth with our overall policies in force (PIFs) growing by 12%, compared to last March, with all segments growing double digits. This is the first time that our personal auto, special lines, and Commercial Lines products all recognized year-over-year double-digit growth since June 2004. In fact, this quarter we also passed several milestones crossing over 25 million companywide PIFs with personal auto and special lines surpassing 17 million and 5 million PIFs, respectively. We are delighted with the fact that we continue to grow our base of customers and intend to use that to catapult us toward our goal of graduating more of our book of business into Robinsons. In fact, in our Direct channel, Robinson PIF growth is up nearly 20% compared to last March and in the Agency channel Robinson PIFs have increased by over 16% since last March.

On the Personal Lines side, we saw solid PIF growth in both our auto and special lines products in both channels, along with continued strong margins. Direct auto is leading the pack and is a tribute to both our brand and having competitive rates. Thirty-two states are on our 8.6 product model, which represented 59% of countrywide premium and 67% of countrywide PIFs at quarter end. We continue to see improved conversion with 8.6 in both the Agency and Direct channels, and especially in more preferred segments. We launched our 8.7 product in January and will comment more once we have sufficient data on the performance of that model.

Commercial Lines NPW was up 57% at a CR of 83.9. The strong growth is driven by a combination of pandemic recovery, entering peak season, and stimulus dollars reaching consumers with the caveat that I mentioned above regarding TNC premium. Commercial auto new business growth continues at a record pace. March new business applications were up significantly over the prior year with for-hire transportation (e.g., truck) continuing to lead the way. This growth continued into the first few weeks of April when we experienced all-time high new business volume levels. Business auto and contractors are also showing some signs of strength. We monitor business market target performance closely. Truck volume growth is in line with the Federal Motor Carrier Safety Administration new motor carrier formation data and all business market targets performed at or better than our profitability targets during the quarter. We rolled out our 8.0 commercial auto product along with our new policy administration system in four additional states and now have 12 states successfully operating on our new system. The new product model is improving the accuracy of our pricing and competitiveness for more stable and established businesses with better retention. Our expansion into the business owners policy (BOP) product line continues. We added two states bringing the state footprint to 19 states representing 37% of the commercial multi-peril market.

We continue to surgically focus on caring for our customers and making every experience with them personal. In fact, several years ago we initiated work to transform key areas of our private passenger auto digital experience systems and offering. The purpose was to better enable our technology and processes for faster digital delivery across our customer-facing platforms. This included delivering a holistically new self-service website built upon customer feedback. Our test of this new experience demonstrated higher customer satisfaction and an overall improvement in customers being able to handle their needs through self-service digital when that is the preferred

1

channel. We’re thrilled to announce that during the first quarter we’ve moved beyond the testing stage and have launched this new website experience for all eligible policyholders.

Our auto customers have rewarded us with loyalty as demonstrated with our increased retention. We believe that a portion of the increase is based on moratoriums on cancellations that were in place last year, and we have made special efforts to assist our customers as their needs have increased throughout the pandemic. We know that many of our customers continue to require our flexibility and our customer service representatives have discretion to personalize the experiences depending on the situation.

We are making plans for what returning to work will look like in all parts of the organization and preparing to also be nimble as we watch everything play out as more and more states reopen. Our number one priority continues to be the health of our employees. The talk around the virtual water cooler has turned from events that were canceled due to COVID-19 to what side effects people are having as many of us get in line for our vaccines. I just had my second vaccine and it gave me hope that there is light at the end of what has been a very long tunnel.

Vehicle miles traveled (VMT), as obtained from our usage-based insurance driving data, has picked up a bit starting around the end of February. Through January and mid-February, driving was consistently down 10-15% versus the 2017-2019 average. Mid-February was distorted by the strong storms in Texas and other states, but after that we saw a shift to VMTs being down about 8-10% versus prior years, which continued through the end of March and into the first week of April.

To that end, we are beginning to see increased driving as states open and people begin to feel more comfortable, perhaps due to the availability of vaccines. With expected increases in domestic travel by car this summer, we believe volume will continue to rise thus leading to more claims activity. In light of an increase in VMTs, normal weather-related losses this time of year, and a rise in our special lines new business volume, we are seeing Personal Lines loss frequency rising relative to the prior year when frequency fell dramatically. We continue to staff up the claims organization to be prepared for the year-over-year increase in volume, which began this quarter and we expect will continue through the rest of the year given the decreases in volume we experienced during 2020.

During the quarter, we began rolling out what we call our Snapshot® Apron Relief program to give our current customer base the opportunity to save money if their driving habits changed during COVID-19. This program offers an optional abbreviated 30-day monitoring period for current Progressive customers. Typically, existing customers who sign up for Snapshot must wait up to six months or more before realizing any benefit. This temporary program was designed to get premium help to those customers more quickly. We have been able to offer this option in 43 states.

The first quarter total return on our investment portfolio was 0.3%, as the strength in equity markets overcame a significant rise in interest rates. Because of these higher interest rates, we took the opportunity to slightly increase our duration from where it sat at the end of last year. We believe our portfolio asset allocation is appropriate for the current environment and believe we are in a strong capital position to withstand investment market volatility that could arise as the country continues to recover from the pandemic.

During the quarter, we announced our intent to acquire Protective Insurance Corporation, subject to regulatory approvals and other customary closing conditions, for $23.30 per outstanding common share, or approximately $338 million in aggregate. We have been very impressed with Protective’s products, employees, and culture. As we have said in the past, Commercial Lines is our greatest opportunity to grow and we are excited to expand our capabilities with the expertise Protective offers in larger fleet and affinity programs and by providing additional product lines such as workers compensation for the transportation industry. We will provide additional information and thoughts after the transaction concludes.

Recently, I shared with you our new Diversity and Inclusion objectives. I’m pleased to say that we continue to make progress, as well as generate excitement and momentum, which we expect will help us to achieve our goals. We want to reflect the customers we serve and compare our workforce with the U.S. adult population as a proxy for our

2

customer base. We ended 2020 with an increase in representation of people of color at Progressive and we expect to reach parity with the U.S. population in the next few years if we maintain our current hiring volume.

We also ended 2020 with increased representation of women and people of color in leadership better reflecting the teams that they lead. Again, assuming our hiring volume remains constant, we expect to reach parity in representation of women in leadership by the end of 2025. Our bigger opportunity is increasing representation of people of color, particularly in senior leadership. I am encouraged by the results to date and we recognize significant work remains to achieve our goal of doubling representation by the end of 2025.

Lastly, we have invested a tremendous amount in Diversity and Inclusion recruiting efforts and with creating programs that will help us bridge the gap for aspiring leaders aimed at “fixing the broken first rung.” This phrase is used to describe the gap in representation of women and people of color in supervisor roles – the first rung on the leadership ladder. This is an opportunity we share with many organizations and these new programs will build upon the success of our flagship Multicultural Leadership Development program.

As I reflect on the past twelve months, I do so with great pride. The extraordinary dedication and resilience that the people of Progressive have shown, at every turn, has been truly remarkable. If last year was a test, we passed with flying colors and it showed that we are resilient. Looking to the future, we will continue to invest in profitably growing every part of the business and taking the learnings from COVID-19 as we reimagine what the future brings. We stand ready for whatever may come our way.

Best,

/s/ Tricia Griffith

Tricia Griffith

President and Chief Executive Officer

3

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2021 shares
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2021
Document Transition Report	false
Entity File Number	001-09518
Entity Incorporation, State or Country Code	OH
Entity Tax Identification Number	34-0963169
Entity Address, Address Line One	6300 Wilson Mills Road,
Entity Address, City or Town	Mayfield Village,
Entity Address, State or Province	OH
Entity Address, Postal Zip Code	44143
City Area Code	440
Local Phone Number	461-5000
Entity Information, Former Legal or Registered Name	Not Applicable
Title of 12(b) Security	Common Shares, $1.00 Par Value
Trading Symbol	PGR
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding	585,153,282
Entity Registrant Name	PROGRESSIVE CORP/OH/
Entity Central Index Key	0000080661
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Amendment Flag	false

XML

Consolidated Statements of Comprehensive Income - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenues
Net premiums earned	$ 10,420.2	$ 9,430.7
Investment income	220.2	241.2
Net realized gains (losses) on securities:
Net realized gains (losses) on security sales	143.8	315.2
Net holding period gains (losses) on securities	441.5	(868.8)
Total net realized gains (losses) on securities	585.3	(553.6)
Fees and other revenues	165.7	153.5
Service revenues	53.8	51.6
Total revenues	11,445.2	9,323.4
Expenses
Losses and loss adjustment expenses	7,110.5	6,155.2
Policy acquisition costs	874.4	782.8
Other underwriting expenses	1,481.1	1,409.9
Investment expenses	5.6	5.3
Service expenses	49.3	47.5
Interest expense	56.4	48.0
Total expenses	9,577.3	8,448.7
Net Income
Income before income taxes	1,867.9	874.7
Provision for income taxes	387.9	175.6
Net income	1,480.0	699.1
Net income attributable to noncontrolling interest (NCI)	0.0	(6.4)
Net income attributable to Progressive	1,480.0	692.7
Other Comprehensive Income (Loss)
Total net unrealized gains (losses) on fixed-maturity securities	(539.6)	62.8
Net unrealized losses on forecasted transactions	0.2	0.2
Other comprehensive income (loss)	(539.4)	63.0
Other comprehensive income attributable to NCI	0.0	(0.5)
Comprehensive income attributable to Progressive	940.6	755.2
Computation of Earnings Per Common Share
Net income attributable to Progressive	1,480.0	692.7
Less: Preferred share dividends	6.7	6.7
Net income available to common shareholders	$ 1,473.3	$ 686.0
Average common shares outstanding - Basic	584.9	584.7
Net effect of dilutive stock-based compensation	2.0	2.2
Total average equivalent common shares - Diluted	586.9	586.9
Basic: Earnings per common share	$ 2.52	$ 1.17
Diluted: Earnings per common share	$ 2.51	$ 1.17

XML

Consolidated Balance Sheets - USD ($) $ in Millions		Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Assets
Fixed maturities (amortized cost: $38,564.0, $33,761.1, and $35,589.1)		$ 39,091.8	$ 36,810.9	$ 34,276.6
Short-term investments (amortized cost: $2,243.1, $2,524.2, and $5,218.5)		2,243.1	5,218.5	2,524.2
Total available-for-sale securities		41,334.9	42,029.4	36,800.8
Nonredeemable preferred stocks (cost: $1,453.9, $1,017.5, and $1,358.7)		1,507.2	1,447.9	933.4
Common equities (cost: $1,204.5, $1,113.2, and $1,187.3)		4,558.5	4,053.0	2,608.1
Total equity securities		6,065.7	5,500.9	3,541.5
Total investments		47,400.6	47,530.3	40,342.3
Cash and cash equivalents		122.9	76.5	369.5
Restricted cash		0.3	0.0	0.9
Cash and cash equivalents		123.2	76.5	370.4
Accrued investment income		166.0	176.4	171.6
Premiums receivable, net of allowance for credit losses of $265.3, $344.7, and $356.2		9,218.8	8,160.1	7,568.3
Reinsurance recoverables		4,143.2	4,019.4	3,639.6
Prepaid reinsurance premiums		667.6	368.1	438.2
Deferred acquisition costs		1,309.1	1,237.2	1,095.8
Property and equipment, net of accumulated depreciation of $1,318.5, $1,191.6, and $1,291.4		1,077.4	1,106.0	1,215.1
Goodwill		452.7	452.7	452.7
Intangible assets, net of accumulated amortization of $340.3, $328.5, and $326.1		157.2	171.4	213.8
Net federal deferred income taxes		0.0	0.0	20.6
Other assets		697.5	800.2	738.0
Total assets		65,413.3	64,098.3	56,266.4
Liabilities
Unearned premiums		15,045.9	13,437.5	12,641.1
Loss and loss adjustment expense reserves		21,063.7	20,265.8	18,306.5
Net federal deferred income taxes		241.5	310.0	0.0
Dividends Payable		58.5	2,694.5	58.5
Accounts payable, accrued expenses, and other liabilities		5,770.4	4,955.8	5,289.2
Debt	[1]	5,396.8	5,396.1	5,394.0
Total liabilities		47,576.8	47,059.7	41,689.3
Redeemable noncontrolling interest (NCI)		0.0	0.0	225.6
Shareholders’ Equity
Serial Preferred Shares, Series B, no par value (cumulative, liquidation preference $1,000 per share) (authorized, issued, and outstanding 0.5)		493.9	493.9	493.9
Common shares, $1.00 par value (authorized 900.0; issued 797.5, including treasury shares of 212.3, 212.2, and 212.3)		585.2	585.2	585.3
Paid-in capital		1,685.5	1,672.9	1,601.9
Retained earnings		14,679.6	13,354.9	11,266.2
Accumulated other comprehensive income (loss):
Net unrealized gains (losses) on fixed-maturity securities		407.7	947.3	423.6
Net unrealized losses on forecasted transactions		(15.4)	(15.6)	(16.2)
Accumulated other comprehensive income attributable to NCI		0.0	0.0	(3.2)
Total accumulated other comprehensive income (loss) attributable to Progressive		392.3	931.7	404.2
Total shareholders’ equity		17,836.5	17,038.6	14,351.5
Total liabilities, redeemable NCI, and shareholders’ equity		$ 65,413.3	$ 64,098.3	$ 56,266.4

[1] Consists of both short-term and long-term debt. See Note 4 – Debt for further discussion.

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Fixed maturities, amortized cost	$ 38,564.0	$ 35,589.1	$ 33,761.1
Short-term investments, amortized cost	2,243.1	5,218.5	2,524.2
Nonredeemable preferred stocks, cost	1,453.9	1,358.7	1,017.5
Common equities, cost	1,204.5	1,187.3	1,113.2
Allowance for credit loss, beginning of period	265.3	356.2	344.7
Property and equipment, accumulated depreciation	1,318.5	1,291.4	1,191.6
Intangible Assets, Accumulated Amortization	$ 340.3	$ 326.1	$ 328.5
Common Shares, par value (USD per share)	$ 1.00	$ 1.00	$ 1.00
Common Shares, authorized (shares)	900,000,000.0	900,000,000.0	900,000,000.0
Common Shares, issued (shares)	797,500,000	797,500,000	797,500,000
Common Shares, treasury shares (shares)	212,300,000	212,300,000	212,200,000
Serial Preferred Stock
Preferred Stock, Shares Authorized (shares)	20,000,000.0	20,000,000.0	20,000,000.0
Series B Preferred Stock | Serial Preferred Stock
Preferred Stock, No Par Value	$ 0	$ 0	$ 0
Preferred Stock, Shares Authorized (shares)	500,000	500,000	500,000
Preferred Stock, Shares Issued (shares)	500,000	500,000	500,000
Preferred Stock, Shares Outstanding (shares)	500,000	500,000	500,000
Preferred Stock, Liquidation Preference Per Share (USD per share)	$ 1,000	$ 1,000	$ 1,000

XML

Consolidated Statements of Changes in Shareholders' Equity Statement - USD ($) $ in Millions	Total	Serial Preferred Stock	Preferred Shares, No Par Value	Common Shares, $1.00 Par Value	Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Income (Loss) Attributable to Progressive	Series B Preferred Stock Serial Preferred Stock	Voting Preference Shares
Common Stock, Dividends, Per Share, Declared	$ 0.10
Preferred Stock, Dividends Per Share, Declared								$ 26.875
Balance, Beginning of period at Dec. 31, 2019			$ 493.9	$ 584.6	$ 1,573.4	$ 10,679.6	$ 341.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income attributable to Progressive	$ 692.7					692.7
Treasury shares purchased				(0.3)	(1.0)	(25.2)
Cash dividends declared on common shares ($0.10 and $0.10 per share)						(58.4)
Cash dividends declared on Serial Preferred Shares, Series B ($0 and $26.875 per share)						(13.4)
Reinvested dividends on restricted stock units					0.3	(0.3)
Net restricted equity awards issued/vested				1.0	(1.0)
Amortization of equity-based compensation					23.3
Adjustment to carrying amount of redeemable noncontrolling interest					6.9
Attributable to noncontrolling interest	(0.5)						(0.5)
Other comprehensive income (loss)	63.0						63.0
Other, net						(8.8)
Balance, End of period at Mar. 31, 2020	$ 14,351.5		493.9	585.3	1,601.9	11,266.2	404.2
Preferred Stock, No Par Value								$ 0
Preferred Stock, Shares Authorized (shares)		20,000,000.0						500,000	5,000,000.0
Preferred Stock, Shares Issued (shares)								500,000	0
Common Shares, par value (USD per share)	$ 1.00
Preferred Stock, No Par Value								$ 0
Preferred Stock, Shares Authorized (shares)		20,000,000.0						500,000
Preferred Stock, Shares Issued (shares)								500,000
Common Shares, par value (USD per share)	1.00
Common Stock, Dividends, Per Share, Declared	$ 0.10
Preferred Stock, Dividends Per Share, Declared								$ 0
Balance, Beginning of period at Dec. 31, 2020	$ 17,038.6		493.9	585.2	1,672.9	13,354.9	931.7
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income attributable to Progressive	1,480.0					1,480.0
Treasury shares purchased				(0.9)	(2.7)	(81.2)
Cash dividends declared on common shares ($0.10 and $0.10 per share)						(58.4)
Cash dividends declared on Serial Preferred Shares, Series B ($0 and $26.875 per share)						0.0
Reinvested dividends on restricted stock units					0.4	(0.4)
Net restricted equity awards issued/vested				0.9	(0.9)
Amortization of equity-based compensation					15.8
Adjustment to carrying amount of redeemable noncontrolling interest					0.0
Attributable to noncontrolling interest	0.0						0.0
Other comprehensive income (loss)	(539.4)						(539.4)
Other, net						(15.3)
Balance, End of period at Mar. 31, 2021	$ 17,836.5		$ 493.9	$ 585.2	$ 1,685.5	$ 14,679.6	$ 392.3
Preferred Stock, No Par Value								$ 0
Preferred Stock, Shares Authorized (shares)		20,000,000.0						500,000	5,000,000.0
Preferred Stock, Shares Issued (shares)								500,000	0
Common Shares, par value (USD per share)	$ 1.00

XML

Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Statement of Cash Flows [Abstract]
Net income	$ 1,480.0	$ 699.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	62.9	62.6
Amortization of intangible assets	14.2	14.5
Net amortization of fixed-income securities	31.7	18.9
Amortization of equity-based compensation	15.8	23.3
Net realized (gains) losses on securities	(585.3)	553.6
Net (gains) losses on disposition of property and equipment	(1.1)	0.1
Changes in:
Premiums receivable	(1,058.7)	(61.0)
Reinsurance recoverables	(123.8)	(260.7)
Prepaid reinsurance premiums	(299.5)	188.3
Deferred acquisition costs	(71.9)	(39.3)
Income taxes	283.8	128.7
Unearned premiums	1,608.4	252.3
Loss and loss adjustment expense reserves	797.9	201.1
Accounts payable, accrued expenses, and other liabilities	380.1	(189.9)
Other, net	80.0	34.2
Net cash provided by operating activities	2,614.5	1,625.8
Purchases:
Fixed maturities	(10,421.4)	(10,433.0)
Equity securities	(196.7)	(366.6)
Sales:
Fixed maturities	5,590.3	7,415.9
Equity securities	63.0	281.0
Maturities, paydowns, calls, and other:
Fixed maturities	1,948.6	2,161.6
Equity securities	39.7	79.0
Net (purchases) sales of short-term investments	2,976.8	(718.9)
Net unsettled security transactions	267.6	586.1
Purchases of property and equipment	(50.5)	(62.4)
Sales of property and equipment	7.5	3.5
Net cash provided by (used in) investing activities	224.9	(1,053.8)
Cash Flows From Financing Activities
Dividends paid to common shareholders	(2,694.5)	(1,375.4)
Dividends paid to preferred shareholders	(13.4)	(13.4)
Acquisition of treasury shares for restricted stock tax liabilities	(30.0)	(26.5)
Acquisition of treasury shares acquired in open market	(54.8)	0.0
Net proceeds from debt issuances	0.0	986.3
Net cash used in financing activities	(2,792.7)	(429.0)
Increase in cash, cash equivalents, and restricted cash	46.7	143.0
Cash, cash equivalents, and restricted cash – January 1	76.5	227.4
Cash, cash equivalents, and restricted cash – March 31	$ 123.2	$ 370.4

XML

Basis of Presentation

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

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

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 March 31, 2021, 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, 2020 (“2020 Annual Report to Shareholders”).

We perform analyses to evaluate our premiums receivables for expected credit losses, based on historical and current collections experience using actuarial analysis, to determine estimated rates of default. These rates are applied to the stratified subsets of our consumer receivable balances, based on the age of the receivable, to establish an allowance for credit loss. Progressive’s premiums receivables are short-term in nature and, generally, premiums are collected prior to providing risk coverage, minimizing our exposure to credit risk. Premiums receivables balances are written off once we have exhausted our collection efforts.

The following table summarizes changes in our allowance for credit loss exposure on our premiums receivables for the year-to-date periods ending:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Allowance for credit loss, beginning of period	$	356.2	$	283.2	$	283.2
Increase in allowance1	60.9		170.3		472.0
Write-offs2	(151.8)		(108.8)		(399.0)
Allowance for credit loss, end of period	$	265.3	$	344.7	$	356.2

1Represents the incremental increase in other underwriting expenses.

2Represents portion of allowance that is reversed when premiums receivables are written off.

During the first quarter 2021, the increase in our allowance for credit losses was lower than prior periods reflecting greater collections received on outstanding premiums receivable balances, due in part to the government stimulus and tax refund checks distributed during the quarter. In contrast, during the first quarter 2020, the increase in the allowance in part reflects the greater potential for credit losses due to the financial hardships of policyholders as a result of the economic impacts related to the spread of the novel coronavirus, COVID-19.

Other assets on the consolidated balance sheets include certain long-lived assets that are considered “held for sale.” The fair value of these held for sale assets, less the estimated costs to sell, was $55.1 million at March 31, 2021, $31.8 million at March 31, 2020, and $56.6 million at December 31, 2020.

XML

Investments

3 Months Ended

Mar. 31, 2021

Investments, Debt and Equity Securities [Abstract]

Investments

Investments — The following tables present the composition of our investment portfolio by major security type, consistent with our classification of how we manage, monitor, and measure the portfolio. Our securities are reported in our consolidated balance sheets at fair value. The changes in fair value for our fixed-maturity securities (other than hybrid securities) are reported as a component of accumulated other comprehensive income, net of deferred income taxes, in our consolidated balance sheets. The net holding period gains (losses) reported below represent the inception-to-date changes in fair value of the securities. The changes in the net holding period gains (losses) between periods for the hybrid securities and equity securities are recorded as a component of net realized gains (losses) on securities in our consolidated statements of comprehensive income.

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
March 31, 2021
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	16,002.7	$	181.7	$	(111.0)	$	0	$	16,073.4	33.9	%
State and local government obligations	2,574.8		65.3		(16.0)		0		2,624.1		5.6
Corporate debt securities	10,095.2		368.1		(24.0)		(3.1)		10,436.2		22.0
Residential mortgage-backed securities	548.3		5.7		(0.8)		0		553.2		1.2
Commercial mortgage-backed securities	5,868.3		68.8		(45.1)		0		5,892.0		12.4
Other asset-backed securities	3,293.5		30.6		(0.7)		0		3,323.4		7.0
Redeemable preferred stocks	181.2		2.9		(2.0)		7.4		189.5		0.4
Total fixed maturities	38,564.0		723.1		(199.6)		4.3		39,091.8		82.5
Short-term investments	2,243.1		0		0		0		2,243.1		4.7
Total available-for-sale securities	40,807.1		723.1		(199.6)		4.3		41,334.9		87.2
Equity securities:
Nonredeemable preferred stocks	1,453.9		0		0		53.3		1,507.2		3.2
Common equities	1,204.5		0		0		3,354.0		4,558.5		9.6
Total equity securities	2,658.4		0		0		3,407.3		6,065.7		12.8
Total portfolio1	$	43,465.5	$	723.1	$	(199.6)	$	3,411.6	$	47,400.6	100.0	%

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
March 31, 2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	10,841.2	$	654.5	$	0	$	0	$	11,495.7	28.5	%
State and local government obligations	2,243.9		64.8		(4.5)		0		2,304.2		5.7
Corporate debt securities	9,452.9		160.8		(120.1)		(1.7)		9,491.9		23.5
Residential mortgage-backed securities	574.3		1.5		(19.2)		0		556.6		1.4
Commercial mortgage-backed securities	5,822.4		30.2		(188.3)		0		5,664.3		14.0
Other asset-backed securities	4,674.9		4.3		(40.0)		(0.1)		4,639.1		11.5
Redeemable preferred stocks	151.5		0		(5.1)		(21.6)		124.8		0.3
Total fixed maturities	33,761.1		916.1		(377.2)		(23.4)		34,276.6		84.9
Short-term investments	2,524.2		0		0		0		2,524.2		6.3
Total available-for-sale securities	36,285.3		916.1		(377.2)		(23.4)		36,800.8		91.2
Equity securities:
Nonredeemable preferred stocks	1,017.5		0		0		(84.1)		933.4		2.3
Common equities	1,113.2		0		0		1,494.9		2,608.1		6.5
Total equity securities	2,130.7		0		0		1,410.8		3,541.5		8.8
Total portfolio1	$	38,416.0	$	916.1	$	(377.2)	$	1,387.4	$	40,342.3	100.0	%

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
December 31, 2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	12,437.9	$	305.8	$	(3.7)	$	0	$	12,740.0	26.8	%
State and local government obligations	3,099.4		123.1		(0.7)		0		3,221.8		6.8
Corporate debt securities	9,579.7		601.7		(0.1)		3.9		10,185.2		21.4
Residential mortgage-backed securities	503.3		7.1		(0.9)		0		509.5		1.1
Commercial mortgage-backed securities	6,042.6		142.5		(10.0)		0		6,175.1		13.0
Other asset-backed securities	3,745.0		40.1		(0.5)		0		3,784.6		7.9
Redeemable preferred stocks	181.2		3.6		(1.4)		11.3		194.7		0.4
Total fixed maturities	35,589.1		1,223.9		(17.3)		15.2		36,810.9		77.4
Short-term investments	5,218.5		0		0		0		5,218.5		11.0
Total available-for-sale securities	40,807.6		1,223.9		(17.3)		15.2		42,029.4		88.4
Equity securities:
Nonredeemable preferred stocks	1,358.7		0		0		89.2		1,447.9		3.1
Common equities	1,187.3		0		0		2,865.7		4,053.0		8.5
Total equity securities	2,546.0		0		0		2,954.9		5,500.9		11.6
Total portfolio1	$	43,353.6	$	1,223.9	$	(17.3)	$	2,970.1	$	47,530.3	100.0	%

1Our portfolio reflects the effect of net unsettled security transactions; at March 31, 2021, we had $363.1 million in other liabilities, compared to $598.0 million and $95.5 million at March 31, 2020 and December 31, 2020, respectively.

The total fair value of the portfolio at March 31, 2021 and 2020, and December 31, 2020, included $3.7 billion, $2.6 billion, and $6.2 billion, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of unsettled security transactions. During the first quarter 2021, we used a portion of these investments to pay our fourth quarter and annual 2020 common share dividends.

At March 31, 2021, bonds and certificates of deposit in the principal amount of $296.1 million were on deposit to meet state insurance regulatory requirements. We did not 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 March 31, 2021 and 2020, or December 31, 2020. At March 31, 2021, we did not hold any debt securities that were non-income producing during the preceding 12 months.

Short-Term Investments Our short-term investments may include commercial paper and other investments that are expected to mature or are redeemable within one year.

We invested in repurchase and reverse repurchase transactions during 2021 and 2020, but did not have any open positions at March 31, 2021 and 2020, or December 31, 2020. To the extent we enter into repurchase or reverse repurchase transactions, consistent with past practice, we would elect not to offset these transactions and would report them on a gross basis on our consolidated balance sheets, despite the option to elect to offset these transactions as long as they were with the same counterparty and subject to an enforceable master netting arrangement.

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:

	March 31,
(millions)	2021		2020		December 31, 2020
Fixed Maturities:
State and local government obligations	$	0	$	3.4	$	0
Corporate debt securities	295.0		116.5		188.4
Residential mortgage-backed securities	35.0		0		0
Other asset-backed securities	31.9		2.2		34.8
Redeemable preferred stocks	127.5		68.4		131.4
Total hybrid securities	$	489.4	$	190.5	$	354.6

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 have elected to record the changes in fair value of these securities through income as a component of net realized gains or losses.

Fixed Maturities The composition of fixed maturities by maturity at March 31, 2021, was:

(millions)	Cost		Fair Value
Less than one year	$	4,918.5	$	4,940.6
One to five years	24,370.8		24,814.6
Five to ten years	9,214.5		9,277.3
Ten years or greater	60.2		59.3
Total	$	38,564.0	$	39,091.8

Asset-backed securities are classified in the maturity distribution table based upon their projected cash flows. All other securities, which 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, for which no credit related impairment has been recognized, 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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
March 31, 2021
U.S. government obligations	36	$	8,612.2	$	(111.0)	35	$	8,598.6	$	(109.7)	1	$	13.6	$	(1.3)
State and local government obligations	92	816.0		(16.0)		92	816.0		(16.0)		0	0		0
Corporate debt securities	79	1,751.4		(24.0)		76	1,698.4		(23.9)		3	53.0		(0.1)
Residential mortgage-backed securities	21	123.4		(0.8)		6	94.4		(0.2)		15	29.0		(0.6)
Commercial mortgage-backed securities	95	2,542.2		(45.1)		77	2,023.9		(41.7)		18	518.3		(3.4)
Other asset-backed securities	43	505.8		(0.7)		36	477.6		(0.5)		7	28.2		(0.2)
Redeemable preferred stocks	1	10.5		(2.0)		0	0		0		1	10.5		(2.0)
Total fixed maturities	367	$	14,361.5	$	(199.6)	322	$	13,708.9	$	(192.0)	45	$	652.6	$	(7.6)

	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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
March 31, 2020
U.S. government obligations	1	$	100.3	$	0	1	$	100.3	$	0	0	$	0	$	0
State and local government obligations	89	528.4		(4.5)		78	507.7		(4.4)		11	20.7		(0.1)
Corporate debt securities	233	4,205.6		(120.1)		233	4,205.6		(120.1)		0	0		0
Residential mortgage-backed securities	70	532.5		(19.2)		46	425.0		(11.9)		24	107.5		(7.3)
Commercial mortgage-backed securities	204	4,441.5		(188.3)		187	4,109.2		(173.8)		17	332.3		(14.5)
Other asset-backed securities	216	3,558.1		(40.0)		201	3,514.2		(39.0)		15	43.9		(1.0)
Redeemable preferred stocks	4	56.3		(5.1)		3	45.2		(3.8)		1	11.1		(1.3)
Total fixed maturities	817	$	13,422.7	$	(377.2)	749	$	12,907.2	$	(353.0)	68	$	515.5	$	(24.2)

	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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
December 31, 2020
U.S. government obligations	9	$	1,511.0	$	(3.7)	9	$	1,511.0	$	(3.7)	0	$	0	$	0
State and local government obligations	30	208.7		(0.7)		30	208.7		(0.7)		0	0		0
Corporate debt securities	7	129.4		(0.1)		7	129.4		(0.1)		0	0		0
Residential mortgage-backed securities	21	44.4		(0.9)		0	0		0		21	44.4		(0.9)
Commercial mortgage-backed securities	43	893.3		(10.0)		9	93.6		(0.3)		34	799.7		(9.7)
Other asset-backed securities	22	183.7		(0.5)		9	74.4		(0.1)		13	109.3		(0.4)
Redeemable preferred stocks	1	11.0		(1.4)		0	0		0		1	11.0		(1.4)
Total fixed maturities	133	$	2,981.5	$	(17.3)	64	$	2,017.1	$	(4.9)	69	$	964.4	$	(12.4)

As of March 31, 2021, we had three securities in the table above, all in our corporate portfolio, that had their credit ratings downgraded during the quarter, with a combined fair value of $31.9 million and an unrealized loss of $0.7 million.

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 not record any allowances for credit losses or any write-offs for amounts deemed to be uncollectible for the first three months of 2021 and did not have a credit loss allowance balance as of March 31, 2021 and 2020, or December 31, 2020. We considered several factors and inputs related to the individual securities as part of this analysis, including:

•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.

In order to determine the amount of credit loss, if any, we initially reviewed securities in a loss position to determine whether it was likely that we would be required, or whether we intended, to sell any of the securities prior to the recovery of their respective cost bases (which could be maturity). If we were likely to, or intended to, sell prior to a potential recovery, we would write off the unrealized loss. For those securities that we determined we were not likely to, or did not intend to, sell prior to a potential recovery, 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 value to determine if a credit loss existed. In the event that the NPV was below the amortized value, and the amount was determined to be material individually, or in aggregate, a credit loss would be deemed to exist, and either an allowance for credit losses would be created, or if an allowance currently existed, either a recovery of the previous allowance, or an incremental loss, would be recorded to net realized gains (losses) on securities.

As of March 31, 2021, we believe none of the unrealized losses relate to material credit losses on any specific securities, or in the aggregate, based on our review. We continue to expect all the securities in our 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 March 31, 2021, to determine if the accrued interest amounts were determined to be 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 not write off any accrued income as uncollectible at March 31, 2021.

Realized Gains (Losses) The components of net realized gains (losses) for the three months ended March 31, were:

	Three Months
(millions)	2021		2020
Gross realized gains on security sales
Available-for-sale securities:
U.S. government obligations	$	66.6	$	251.1
State and local government obligations	30.2		2.0
Corporate and other debt securities	20.7		32.4
Commercial mortgage-backed securities	29.8		6.1
Other asset-backed securities	0.7		0
Total available-for-sale securities	148.0		291.6
Equity securities:
Nonredeemable preferred stocks	17.3		19.6
Common equities	1.1		66.0
Total equity securities	18.4		85.6
Subtotal gross realized gains on security sales	166.4		377.2
Gross realized losses on security sales
Available-for-sale securities:
U.S. government obligations	(19.6)		(2.7)
State and local government obligations	(0.2)		0
Corporate and other debt securities	(2.1)		(1.0)
Commercial mortgage-backed securities	(0.6)		0
Other asset-backed securities	(0.1)		0
Total available-for-sale securities	(22.6)		(3.7)
Equity securities:
Nonredeemable preferred stocks	0		(4.4)
Common equities	0		(53.9)
Total equity securities	0		(58.3)
Subtotal gross realized losses on security sales	(22.6)		(62.0)
Net realized gains (losses) on security sales
Available-for-sale securities:
U.S. government obligations	47.0		248.4
State and local government obligations	30.0		2.0
Corporate and other debt securities	18.6		31.4
Commercial mortgage-backed securities	29.2		6.1
Other asset-backed securities	0.6		0
Total available-for-sale securities	125.4		287.9
Equity securities:
Nonredeemable preferred stocks	17.3		15.2
Common equities	1.1		12.1
Total equity securities	18.4		27.3
Subtotal net realized gains (losses) on security sales	143.8		315.2
Net holding period gains (losses)
Hybrid securities	(10.9)		(31.2)
Equity securities	452.4		(837.6)
Subtotal net holding period gains (losses)	441.5		(868.8)
Total net realized gains (losses) on securities	$	585.3	$	(553.6)

Realized gains (losses) on securities sold are computed using the first-in-first-out method.

The following table reflects our holding period realized gains (losses) on equity securities recognized for the three months ended March 31, 2021 and 2020, for equity securities held at the respective quarter end:

	Three Months
(millions)	2021		2020
Total net gains (losses) recognized during the period on equity securities	$	470.8	$	(810.3)
Less: Net gains (losses) recognized on equity securities sold during the period	18.4		27.3
Net holding period gains (losses) recognized during the period on equity securities held at period end	$	452.4	$	(837.6)

During the first quarter 2021, as expectations of U.S. economic growth increased, the value of our equity securities also rose. In contrast, during the first quarter 2020, we recognized significant declines in the equity security valuations due to investors reducing exposure to risk in response to the economic impact of COVID-19 restrictions.

Net Investment Income The components of net investment income for the three months ended March 31, were: 

	Three Months
(millions)	2021		2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	30.4	$	62.6
State and local government obligations	13.4		9.6
Corporate debt securities	85.2		58.0
Residential mortgage-backed securities	3.4		4.2
Commercial mortgage-backed securities	35.8		34.3
Other asset-backed securities	15.9		29.2
Redeemable preferred stocks	2.5		7.9
Total fixed maturities	186.6		205.8
Short-term investments	1.5		7.0
Total available-for-sale securities	188.1		212.8
Equity securities:
Nonredeemable preferred stocks	17.9		13.8
Common equities	14.2		14.6
Total equity securities	32.1		28.4
Investment income	220.2		241.2
Investment expenses	(5.6)		(5.3)
Net investment income	$	214.6	$	235.9

The amount of investment income (interest and dividends) we earn varies based on the average assets held during the year and the book yields of the securities in our portfolio. On a year-over-year basis, investment income decreased 9% for the first three months of 2021, compared to the same period last year, due to a decrease in the portfolio yield, which was partially offset by an increase in average assets. The recurring investment book yield decreased about 22% for the first three months of 2021, compared to the same period in 2020, as a result of investing cash from operations and reinvesting cash from sales, maturities, paydowns, and other redemptions at market yields that were significantly lower than the portfolio’s overall yield. The income reduction from the negative yield change was partially offset by an increase in income earned as a result of investing the $1.0 billion of proceeds from the debt issued during March 2020, as well as strong premium growth and underwriting profitability, net of payments of our common and preferred stock dividends.

XML

Fair Value

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Fair Value

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 securities).

•Level 2: Inputs (other than quoted prices included within Level 1) that are observable for the instrument either directly or indirectly (e.g., certain corporate and municipal bonds and certain preferred stocks). 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 structured securities and privately held investments).

Determining the fair value of the investment portfolio is the responsibility of management. As part of the 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
March 31, 2021
Fixed maturities:
U.S. government obligations	$	16,073.4	$	0	$	0	$	16,073.4	$	16,002.7
State and local government obligations	0		2,624.1		0		2,624.1		2,574.8
Corporate debt securities	0		10,436.2		0		10,436.2		10,095.2
Subtotal	16,073.4		13,060.3		0		29,133.7		28,672.7
Asset-backed securities:
Residential mortgage-backed	0		553.2		0		553.2		548.3
Commercial mortgage-backed	0		5,892.0		0		5,892.0		5,868.3
Other asset-backed	0		3,323.4		0		3,323.4		3,293.5
Subtotal asset-backed securities	0		9,768.6		0		9,768.6		9,710.1
Redeemable preferred stocks:
Financials	0		50.6		0		50.6		51.0
Utilities	0		11.4		0		11.4		10.0
Industrials	10.6		116.9		0		127.5		120.2
Subtotal redeemable preferred stocks	10.6		178.9		0		189.5		181.2
Total fixed maturities	16,084.0		23,007.8		0		39,091.8		38,564.0
Short-term investments	2,227.8		15.3		0		2,243.1		2,243.1
Total available-for-sale securities	18,311.8		23,023.1		0		41,334.9		40,807.1
Equity securities:
Nonredeemable preferred stocks:
Financials	113.8		1,274.7		35.0		1,423.5		1,373.9
Utilities	0		41.9		0		41.9		39.9
Industrials	0		25.2		16.6		41.8		40.1
Subtotal nonredeemable preferred stocks	113.8		1,341.8		51.6		1,507.2		1,453.9
Common equities:
Common stocks	4,555.3		0		0		4,555.3		1,201.3
Other risk investments	0		0		3.2		3.2		3.2
Subtotal common equities	4,555.3		0		3.2		4,558.5		1,204.5
Total equity securities	4,669.1		1,341.8		54.8		6,065.7		2,658.4
Total portfolio	$	22,980.9	$	24,364.9	$	54.8	$	47,400.6	$	43,465.5
Debt	$	0	$	6,195.2	$	0	$	6,195.2	$	5,396.8

	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
March 31, 2020
Fixed maturities:
U.S. government obligations	$	11,495.7	$	0	$	0	$	11,495.7	$	10,841.2
State and local government obligations	0		2,304.2		0		2,304.2		2,243.9
Corporate debt securities	0		9,491.9		0		9,491.9		9,452.9
Subtotal	11,495.7		11,796.1		0		23,291.8		22,538.0
Asset-backed securities:
Residential mortgage-backed	0		556.6		0		556.6		574.3
Commercial mortgage-backed	0		5,664.3		0		5,664.3		5,822.4
Other asset-backed	0		4,639.1		0		4,639.1		4,674.9
Subtotal asset-backed securities	0		10,860.0		0		10,860.0		11,071.6
Redeemable preferred stocks:
Financials	0		47.2		0		47.2		51.4
Utilities	0		9.2		0		9.2		10.0
Industrials	7.3		61.1		0		68.4		90.1
Subtotal redeemable preferred stocks	7.3		117.5		0		124.8		151.5
Total fixed maturities	11,503.0		22,773.6		0		34,276.6		33,761.1
Short-term investments	2,438.4		85.8		0		2,524.2		2,524.2
Total available-for-sale securities	13,941.4		22,859.4		0		36,800.8		36,285.3
Equity securities:
Nonredeemable preferred stocks:
Financials	105.5		752.3		13.1		870.9		937.4
Utilities	0		32.0		0		32.0		40.0
Industrials	0		15.3		15.2		30.5		40.1
Subtotal nonredeemable preferred stocks	105.5		799.6		28.3		933.4		1,017.5
Common equities:
Common stocks	2,607.8		0		0		2,607.8		1,112.9
Other risk investments	0		0		0.3		0.3		0.3
Subtotal common equities	2,607.8		0		0.3		2,608.1		1,113.2
Total equity securities	2,713.3		799.6		28.6		3,541.5		2,130.7
Total portfolio	$	16,654.7	$	23,659.0	$	28.6	$	40,342.3	$	38,416.0
Debt	$	0	$	6,108.6	$	0	$	6,108.6	$	5,394.0

	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
December 31, 2020
Fixed maturities:
U.S. government obligations	$	12,740.0	$	0	$	0	$	12,740.0	$	12,437.9
State and local government obligations	0		3,221.8		0		3,221.8		3,099.4
Corporate debt securities	0		10,185.2		0		10,185.2		9,579.7
Subtotal	12,740.0		13,407.0		0		26,147.0		25,117.0
Asset-backed securities:
Residential mortgage-backed	0		509.5		0		509.5		503.3
Commercial mortgage-backed	0		6,175.1		0		6,175.1		6,042.6
Other asset-backed	0		3,784.6		0		3,784.6		3,745.0
Subtotal asset-backed securities	0		10,469.2		0		10,469.2		10,290.9
Redeemable preferred stocks:
Financials	0		51.6		0		51.6		51.1
Utilities	0		11.7		0		11.7		10.0
Industrials	10.8		120.6		0		131.4		120.1
Subtotal redeemable preferred stocks	10.8		183.9		0		194.7		181.2
Total fixed maturities	12,750.8		24,060.1		0		36,810.9		35,589.1
Short-term investments	4,704.9		513.6		0		5,218.5		5,218.5
Total available-for-sale securities	17,455.7		24,573.7		0		42,029.4		40,807.6
Equity securities:
Nonredeemable preferred stocks:
Financials	117.7		1,212.3		35.0		1,365.0		1,278.6
Utilities	0		41.9		0		41.9		40.0
Industrials	0		24.3		16.7		41.0		40.1
Subtotal nonredeemable preferred stocks	117.7		1,278.5		51.7		1,447.9		1,358.7
Common equities:
Common stocks	4,049.9		0		0		4,049.9		1,184.2
Other risk investments	0		0		3.1		3.1		3.1
Subtotal common equities	4,049.9		0		3.1		4,053.0		1,187.3
Total equity securities	4,167.6		1,278.5		54.8		5,500.9		2,546.0
Total portfolio	$	21,623.3	$	25,852.2	$	54.8	$	47,530.3	$	43,353.6
Debt	$	0	$	6,793.5	$	0	$	6,793.5	$	5,396.1

Our portfolio valuations, excluding short-term investments, 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 are highly liquid, actively marketed, and have a very short duration, primarily 90 days or less to redemption. These securities are held at their original cost, adjusted for any accretion of discount, since that value very closely approximates what an active market participant would be willing to pay for such securities. The remainder of our short-term investments are classified as Level 2 and are not priced externally since these securities continually trade at par value. These securities are classified as Level 2 since they are primarily longer-dated securities issued by municipalities that contain either liquidity facilities or mandatory put features within one year.

At March 31, 2021, vendor-quoted prices represented 78% of our Level 1 classifications (excluding short-term investments), compared to 82% and 76% at March 31, 2020 and December 31, 2020, respectively. 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 March 31, 2021 and December 31, 2020, vendor-quoted prices comprised 99% of our Level 2 classifications (excluding short-term investments), while dealer-quoted prices represented the remaining 1%, compared to 98% and 2%, respectively, at March 31, 2020. 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 at least 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 our structured debt securities, including commercial, residential, and 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 our structured debt securities into more finite sectors (e.g., planned amortization class, first pay, second pay, senior, subordinated, etc.) and use duration, credit quality, and coupon to determine if the fair value is appropriate.

For our corporate debt and preferred stock (redeemable and nonredeemable) portfolios, as well as the notes issued by The Progressive Corporation (see Note 4 – Debt), we review securities by duration, coupon, and credit quality, 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 our municipal securities (e.g., general obligations, revenue, and housing), we stratify the portfolio to evaluate securities by type, coupon, credit quality, and duration 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.

Lastly, for our short-term securities, we look at acquisition price relative to the coupon or yield. Since our short-term securities are typically 90 days or less to maturity, with the majority listed in Level 2 being 30 days or less to redemption, we believe that acquisition price is the best estimate of fair value.

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 explain significant price changes (i.e., greater than 2%) as known events occur in the marketplace and affect a 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.

Except as described below, our Level 3 securities are also 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. Certain private equity investments included in the Level 3 category are valued using external pricing supplemented by internal review and analysis.

After all the valuations are received and our review is complete, if the inputs used by vendors are determined to not contain sufficient observable market information, we will reclassify the affected security valuations to Level 3. At March 31, 2021 and 2020, and December 31, 2020, we did not have any securities in our fixed-maturity portfolio listed as Level 3.

At March 31, 2021 and December 31, 2020, we held four private nonredeemable preferred securities that were priced internally or by a pricing firm, and we held three private nonredeemable preferred securities at March 31, 2020. At March 31, 2021 and December 31, 2020, we held two Level 3 other risk investments that were priced using the cost method, compared to one Level 3 other risk investment at March 31, 2020.

To the extent we receive prices from external sources for the Level 3 securities, we would review those prices for reasonableness using internally developed assumptions and then compare our derived prices to the prices we received. During 2021 and 2020, there were no material assets or liabilities measured at fair value on a nonrecurring basis.

Based on our review, all prices received from external sources for 2021 remained unadjusted. 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 months ended March 31, 2021 and 2020:

	Level 3 Fair Value
(millions)	Fair Value at December 31, 2020		Calls/ Maturities/ Paydowns		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation		Net Transfers In (Out)		Fair Value at March 31, 2021
Equity securities:
Nonredeemable preferred stocks:
Financials	$	35.0	$	0	$	0	$	0	$	0	$	0	$	0	$	35.0
Industrials	16.7		0		0		0		0		(0.1)		0		16.6
Common equities:
Other risk investments	3.1		0		0.1		0		0		0		0		3.2
Total Level 3 securities	$	54.8	$	0	$	0.1	$	0	$	0	$	(0.1)	$	0	$	54.8

	Level 3 Fair Value
(millions)	Fair Value at December 31, 2019		Calls/ Maturities/ Paydowns		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation		Net Transfers In (Out)		Fair Value at March 31, 2020
Equity securities:
Nonredeemable preferred stocks:
Financials	$	27.1	$	0	$	0	$	0	$	0	$	(14.0)	$	0	$	13.1
Industrials	16.0		0		0		0		0		$	(0.8)	0		15.2
Common equities:
Other risk investments	0.3		0		0		0		0		0		0		0.3
Total Level 3 securities	$	43.4	$	0	$	0	$	0	$	0	$	(14.8)	$	0	$	28.6

The following tables provide a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at March 31, 2021 and 2020, and December 31, 2020:

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at March 31, 2021		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials1	$	25.0	Internal price	Unadjusted purchase price per share	3.7
Financials2	10.0		Internal price	Unadjusted purchase price per share	16.9
Industrials	6.9		Pricing firm	Market approach (guideline public company method)	5.4
Industrials	9.7		Pricing firm	Market approach (guideline public company method)	4.8
Subtotal Level 3 securities	51.6
Pricing exemption securities	3.2
Total Level 3 securities	$	54.8

1 This security was purchased in May 2020.

2 This security was purchased in November 2020.

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at March 31, 2020		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials	$	13.1	Internal price	Market approach (guideline public company method)	4.4
Industrials1	7.1		Internal price	Market approach (guideline public company method)	5.6
Industrials1	8.1		Internal price	Market approach (guideline public company method)	4.0
Subtotal Level 3 securities	28.3
Pricing exemption securities	0.3
Total Level 3 securities	$	28.6

1Modified prior year disclosure to present securities individually to conform to the current year presentation.

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at December 31, 2020		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials1	$	25.0	Internal price	Unadjusted purchase price per share	3.7
Financials2	10.0		Internal price	Unadjusted purchase price per share	16.9
Industrials	6.9		Pricing firm	Market approach (guideline public company method)	5.4
Industrials	9.8		Pricing firm	Market approach (guideline public company method)	4.8
Subtotal Level 3 securities	51.7
Pricing exemption securities	3.1
Total Level 3 securities	$	54.8

1 This security was purchased in May 2020.

2 This security was purchased in November 2020.

XML

Debt

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Debt

Debt — Debt at each of the balance sheet periods consisted of:

	March 31, 2021				March 31, 2020				December 31, 2020
(millions)	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
3.75% Senior Notes due 2021 (issued: $500.0, August 2011)	$	499.9	$	506.7	$	499.5	$	510.7	$	499.8	$	510.9
2.45% Senior Notes due 2027 (issued: $500.0, August 2016)	497.4		526.8		497.0		488.2		497.3		541.1
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999)	297.0		386.1		296.7		395.3		296.9		409.4
4.00% Senior Notes due 2029 (issued: $550.0, October 2018)	545.6		623.7		545.1		605.7		545.5		660.4
3.20% Senior Notes due 2030 (issued: $500.0, March 2020)	496.2		536.7		495.8		543.2		496.1		575.5
6.25% Senior Notes due 2032 (issued: $400.0, November 2002)	396.0		531.4		395.8		539.6		396.0		582.0
4.35% Senior Notes due 2044 (issued: $350.0, April 2014)	346.8		413.9		346.7		391.7		346.7		459.7
3.70% Senior Notes due 2045 (issued: $400.0, January 2015)	395.6		430.2		395.4		406.2		395.5		481.0
4.125% Senior Notes due 2047 (issued: $850.0, April 2017)	841.7		977.1		841.6		991.9		841.7		1,113.1
4.20% Senior Notes due 2048 (issued: $600.0, March 2018)	590.0		698.7		589.9		675.8		590.0		806.7
3.95% Senior Notes due 2050 (issued: $500.0, March 2020)	490.6		563.9		490.5		560.3		490.6		653.7
Total	$	5,396.8	$	6,195.2	$	5,394.0	$	6,108.6	$	5,396.1	$	6,793.5

At March 31, 2021 and December 31, 2020, short-term debt consisted of the $500 million 3.75% Senior Notes that mature in August 2021; there was no short-term debt outstanding at March 31, 2020.

The Progressive Corporation has a line of credit with PNC Bank, National Association (PNC), in the maximum principal amount of $250 million. See the 2020 Annual Report to Shareholders for terms of this line of credit. We had no borrowings under the line of credit during the periods presented.

XML

Income Taxes

3 Months Ended

Mar. 31, 2021

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes — Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax bases of assets and liabilities at the enacted tax rates. We review our deferred tax assets regularly for recoverability. At March 31, 2021 and 2020, and December 31, 2020, we determined that we did not need a valuation allowance on our gross deferred tax assets. Although realization of the deferred tax assets is not assured, management believes that it is more likely than not 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.

For the three months ended March 31, 2021, there have been no material changes in our reserve for uncertain tax positions.

The effective tax rate for the three months ended March 31, 2021, was 20.8%, compared to 20.1% for the same period last year.

Net state deferred income tax asset and liability amounts as of March 31, 2020, were reclassified on the consolidated balance sheets into other assets and accounts payable, accrued expenses, and other liabilities, respectively, from net federal deferred income taxes to conform to the current year presentation.

XML

Loss and Loss Adjustment Expense Reserves

3 Months Ended

Mar. 31, 2021

Loss and Loss Adjustment Expenses Reserves [Abstract]

Loss and Loss Adjustment Expenses Reserves

Loss and Loss Adjustment Expense Reserves — Activity in the loss and loss adjustment expense reserves is summarized as follows:

	March 31,
(millions)	2021		2020
Balance at January 1	$	20,265.8	$	18,105.4
Less reinsurance recoverables on unpaid losses	3,798.2		3,212.2
Net balance at January 1	16,467.6		14,893.2
Incurred related to:
Current year	6,986.1		6,011.1
Prior years	124.4		144.1
Total incurred	7,110.5		6,155.2
Paid related to:
Current year	3,029.3		2,916.4
Prior years	3,453.7		3,269.2
Total paid	6,483.0		6,185.6
Net balance at March 31	17,095.1		14,862.8
Plus reinsurance recoverables on unpaid losses	3,968.6		3,443.7
Balance at March 31	$	21,063.7	$	18,306.5

We experienced unfavorable reserve development of $124.4 million and $144.1 million during the first three months of 2021 and 2020, respectively, which is reflected as “Incurred related to prior years” in the table above.

First Quarter 2021

•Approximately 34% of the unfavorable prior year reserve development was attributable to accident year 2020, 34% to accident year 2019, and the remainder to accident years 2018 and prior.

•Our personal auto products incurred about $92 million of unfavorable loss and loss adjustment expense (LAE) reserve development, with about 60% attributable to the Agency business. The unfavorable development was primarily attributable to a higher than anticipated frequency of reopened personal injury protection (PIP) claims, primarily in Florida, and higher than anticipated late reported losses occurring toward the end of 2020 but not reported until 2021.

•Our Commercial Lines business experienced about $29 million of unfavorable development, primarily due to the emergence of large injury claims at rates higher than originally anticipated.

•Our special lines business experienced about $5 million of favorable development and our Property business experienced about $8 million of unfavorable development during the first quarter.

First Quarter 2020

•Approximately 52% of the unfavorable prior year reserve development was attributable to accident year 2019, 36% to accident year 2018, and the remainder to accident years 2017 and prior.

•Our personal auto products incurred about $104 million of unfavorable loss and LAE reserve development, with the Agency and Direct auto businesses each contributing about half. The unfavorable development was primarily attributable to revised estimates of our per claim settlement costs and late reported losses occurring toward the end of 2019 but not reported until 2020.

•Our Commercial Lines business experienced about $54 million of unfavorable development, primarily due to increased injury severity and the emergence of large injury claims at rates higher than originally anticipated.

•Our special lines business experienced about $14 million of favorable development and our Property business had minimal development during the first quarter.

XML

Supplemental Cash Flow Information

3 Months Ended

Mar. 31, 2021

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information

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, and are not considered part of the investment portfolio. The amount of reverse repurchase commitments held by these subsidiaries at March 31, 2021 and 2020, and December 31, 2020, were $154.0 million, $80.6 million, and $93.5 million, respectively. Restricted cash on our consolidated balance sheets represents cash that is restricted to pay flood claims under the National Flood Insurance Program’s “Write Your Own” program, for which certain subsidiaries are administrators.

During the first quarter 2021 and 2020, non-cash activity included declared but unpaid common share dividends of $58.5 million (see Note 9 – Dividends for further discussion) for both periods, and operating lease liabilities arising from obtaining right-of-use assets of $6.2 million and $9.7 million, respectively.

We paid the following in the respective periods: 

	Three Months Ended March 31,
(millions)	2021		2020
Income taxes	$	0.8	$	0
Interest	74.3		56.4
Operating lease liabilities	24.5		22.7

XML

Segment Information

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Segment Information

Segment Information — Our Personal Lines segment writes insurance for personal autos and recreational vehicles (our special lines products). Our Commercial Lines segment writes auto-related primary liability and physical damage insurance, and business-related general liability and property insurance, predominately for small businesses. Our Property segment writes residential property insurance for homeowners, other property owners, and renters. Our service businesses provide insurance-related services, including processing Commercial Automobile Insurance Procedures/Plans (CAIP) business and 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; all intercompany transactions are eliminated in consolidation.

Following are the operating results for the respective periods:

	Three Months Ended March 31,
	2021				2020
(millions)	Revenues		Pretax Profit (Loss)		Revenues		Pretax Profit (Loss)
Personal Lines
Agency	$	4,098.2	$	547.5	$	3,828.7	$	601.6
Direct	4,431.7		414.6		3,992.4		473.0
Total Personal Lines1	8,529.9		962.1		7,821.1		1,074.6
Commercial Lines	1,417.8		228.5		1,189.0		112.5
Property2	472.5		(70.7)		420.6		49.2
Total underwriting operations	10,420.2		1,119.9		9,430.7		1,236.3
Fees and other revenues3	165.7		NA		153.5		NA
Service businesses	53.8		4.5		51.6		4.1
Investments4	805.5		799.9		(312.4)		(317.7)
Interest expense	NA		(56.4)		NA		(48.0)
Consolidated total	$	11,445.2	$	1,867.9	$	9,323.4	$	874.7

NA = Not applicable

1 Personal auto insurance accounted for 94% of the total Personal Lines segment net premiums earned during the three months ended March 31, 2021 and 2020; insurance for our special lines products (e.g., motorcycles, ATVs, RVs, watercraft, and snowmobiles) accounted for the balance of the Personal Lines net premiums earned.

2 For the three months ended March 31, 2021 and 2020, pretax profit (loss) includes $14.2 million and $14.5 million, respectively, of amortization expense predominately associated with intangible assets. See Note 12 – Goodwill and Intangible Assets for further discussion.

3 Pretax profit (loss) for fees and other revenues is allocated to operating segments.

4 Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expense.

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 (i.e., revenues from underwriting operations). 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. Following are the underwriting margins and combined ratios for our underwriting operations for the respective periods:

	Three Months Ended March 31,
	2021			2020
	Underwriting Margin		Combined Ratio	Underwriting Margin		Combined Ratio
Personal Lines
Agency	13.4	%	86.6	15.7	%	84.3
Direct	9.4		90.6	11.9		88.1
Total Personal Lines	11.3		88.7	13.7		86.3
Commercial Lines	16.1		83.9	9.5		90.5
Property1	(15.0)		115.0	11.7		88.3
Total underwriting operations	10.7		89.3	13.1		86.9

1 Included in the three months ended March 31, 2021 and 2020, is 3.0 points and 3.4 points, respectively, of amortization expense predominately associated with intangible assets.

XML

Dividends

3 Months Ended

Mar. 31, 2021

Dividends [Abstract]

Dividends

Dividends — Following is a summary of our common and preferred share dividends that were declared and/or paid during the three months ended March 31, 2021 and 2020:

(millions, except per share amounts)		Amount
Declared	Payable	Per Share		Accrued1
Common - Quarterly Dividends:
March 2021	April 2021	$	0.10	$	58.5
December 2020	January 2021	0.10		58.6
February 2020	April 2020	0.10		58.5
December 2019	January 2020	0.10		58.5
Common - Annual Variable Dividends:
December 2020	January 2021	4.50		2,635.9
December 2019	January 2020	2.25		1,316.9
Preferred Dividends:
December 2020	March 2021	26.875		13.4
February 2020	March 2020	26.875		13.4

1 The accrual is based on an estimate of shares outstanding as of the record date. The dividends accrued at March 31, 2020, were reclassified from accounts payable, accrued expenses, and other liabilities into dividends payable on common shares on the consolidated balance sheets, to conform to the current year presentation.

See Note 14 – Dividends in our 2020 Annual Report to Shareholders for a discussion of our common and preferred share dividend policies.

XML

Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

Other Comprehensive Income (Loss)

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 gains (losses) on forecasted transactions		(Income) loss attributable to NCI
Balance at December 31, 2020	$	1,187.4	$	(255.7)	$	931.7	$	947.3	$	(15.6)	$	0
Other comprehensive income (loss) before reclassifications:
Investment securities	(551.4)		115.8		(435.6)		(435.6)		0		0
Loss attributable to noncontrolling interest (NCI)	0		0		0		0		0		0
Total other comprehensive income (loss) before reclassifications	(551.4)		115.8		(435.6)		(435.6)		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
Net realized gains (losses) on securities	131.7		(27.7)		104.0		104.0		0		0
Interest expense	(0.3)		0.1		(0.2)		0		(0.2)		0
Total reclassification adjustment for amounts realized in net income	131.4		(27.6)		103.8		104.0		(0.2)		0
Total other comprehensive income (loss)	(682.8)		143.4		(539.4)		(539.6)		0.2		0
Balance at March 31, 2021	$	504.6	$	(112.3)	$	392.3	$	407.7	$	(15.4)	$	0

							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 gains (losses) on forecasted transactions		(Income) loss attributable to NCI
Balance at December 31, 2019	$	435.7	$	(94.0)	$	341.7	$	360.8	$	(16.4)	$	(2.7)
Other comprehensive income (loss) before reclassifications:
Investment securities	318.2		(66.8)		251.4		251.4		0		0
Loss attributable to noncontrolling interest (NCI)	(0.6)		0.1		(0.5)		0		0		(0.5)
Total other comprehensive income (loss) before reclassifications	317.6		(66.7)		250.9		251.4		0		(0.5)
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
Net realized gains (losses) on securities	238.7		(50.1)		188.6		188.6		0		0
Interest expense	(0.3)		0.1		(0.2)		0		(0.2)		0
Total reclassification adjustment for amounts realized in net income	238.4		(50.0)		188.4		188.6		(0.2)		0
Total other comprehensive income (loss)	79.2		(16.7)		62.5		62.8		0.2		(0.5)
Balance at March 31, 2020	$	514.9	$	(110.7)	$	404.2	$	423.6	$	(16.2)	$	(3.2)

In an effort to manage interest rate risk, we may enter into forecasted transactions on Progressive’s debt issuances. We expect to reclassify $0.7 million (pretax) into interest expense during the next 12 months, related to net unrealized losses on forecasted transactions (see Note 4 – Debt in our 2020 Annual Report to Shareholders for further discussion).

XML

Litigation

3 Months Ended

Mar. 31, 2021

Commitments and Contingencies Disclosure [Abstract]

Litigation

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 subsidiaries are named as defendants in a number of class action or individual lawsuits that challenge certain of the operations of the subsidiaries. Other insurance companies face many of these same issues.

These cases include those alleging damages as a result of, among other things, our subsidiaries’ practices in evaluating or paying medical or injury claims or benefits, including, but not limited to, personal injury protection, medical payments, uninsured motorist/underinsured motorist, and bodily injury benefits, and for reimbursing medical costs incurred by Medicare/Medicaid beneficiaries; our practices in evaluating or paying physical damage claims, including, but not limited to, our payment of total loss claims and labor rates paid to auto body repair shops; our insurance product design; employment matters; and cases challenging other aspects of our claims, marketing, pricing or sales practices or other business operations. Other insurance companies face many of these same issues.

The nature and volume of litigation to which The Progressive Corporation is subject is similar to that which was disclosed in Note 12 – Litigation in our 2020 Annual Report to Shareholders.

We plan to contest the pending lawsuits vigorously, but may pursue settlement negotiations in some cases, as we deem appropriate. The outcomes of pending cases are uncertain at this time. We establish accruals for these lawsuits when it is probable that a loss has been or will be incurred and we can reasonably estimate potential loss exposure, which may include a range of loss. As to lawsuits for which the loss is considered neither probable or estimable, or is considered probable but not estimable, we do not establish an accrual. Nevertheless, we continue to evaluate this pending litigation to determine if any losses not deemed probable and estimable become so, at which point we would establish an accrual at our best estimate of the loss or range of loss.

With respect to our pending lawsuits that are not related to claims under insurance policies, the accruals that we have established, if any, were not material at March 31, 2021 or 2020, and there were no material settlements during 2020 or the first three months of 2021. 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 2020 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 by a significant amount, 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 12 – Litigation in our 2020 Annual Report to Shareholders.

XML

Goodwill and Intangible Assets

3 Months Ended

Mar. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Goodwill

During the three months ended March 31, 2021, there were no changes to the carrying amount of goodwill. No accumulated goodwill impairment losses exist.

Intangible Assets

The following table is a summary of the net carrying amount of other intangible assets:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Intangible assets subject to amortization	$	144.8	$	201.4	$	159.0
Indefinite-lived intangible assets1	12.4		12.4		12.4
Total	$	157.2	$	213.8	$	171.4

1 Indefinite-lived intangible assets are comprised of state insurance and agent licenses. State insurance licenses were previously subject to amortization under superseded accounting guidance and have $0.6 million of accumulated amortization for all periods presented.

Intangible assets subject to amortization consisted of the following:

	March 31, 2021						March 31, 2020						December 31, 2020
(millions)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Category:
Policies in force	$	256.2	$	219.6	$	36.6	$	256.2	$	183.0	$	73.2	$	256.2	$	210.4	$	45.8
Agency relationships	159.2		68.3		90.9		159.2		56.9		102.3		159.2		65.4		93.8
Software rights	69.1		51.8		17.3		79.1		53.2		25.9		69.1		49.7		19.4
Trade name	0		0		0		34.8		34.8		0		0		0		0
Total	$	484.5	$	339.7	$	144.8	$	529.3	$	327.9	$	201.4	$	484.5	$	325.5	$	159.0

Amortization expense was $14.2 million, compared to $14.5 million for the three months ended March 31, 2021 and 2020, respectively.

XML

New Accounting Standards	3 Months Ended
	Mar. 31, 2021
Accounting Policies [Abstract]
New Accounting Standards	New Accounting Standards We did not adopt any new accounting standards during the three months ended March 31, 2021. We assessed the adoption impacts of recently issued accounting standards by the Financial Accounting Standards Board on our consolidated financial statements as well as material updates to previous assessments, if any, from our Annual Report on Form 10-K for the fiscal year ended December 31, 2020. There were no new material accounting standards issued in the three months ended March 31, 2021, that impacted The Progressive Corporation.

XML

Basis of Presentation (Policies)	3 Months Ended
	Mar. 31, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Financing Receivable, Allowance for Credit Losses, Policy for Uncollectible Amounts	We perform analyses to evaluate our premiums receivables for expected credit losses, based on historical and current collections experience using actuarial analysis, to determine estimated rates of default. These rates are applied to the stratified subsets of our consumer receivable balances, based on the age of the receivable, to establish an allowance for credit loss. Progressive’s premiums receivables are short-term in nature and, generally, premiums are collected prior to providing risk coverage, minimizing our exposure to credit risk. Premiums receivables balances are written off once we have exhausted our collection efforts.

XML

Basis of Presentation (Tables)

3 Months Ended

Mar. 31, 2021

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Premium Receivable, Allowance for Credit Loss

The following table summarizes changes in our allowance for credit loss exposure on our premiums receivables for the year-to-date periods ending:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Allowance for credit loss, beginning of period	$	356.2	$	283.2	$	283.2
Increase in allowance1	60.9		170.3		472.0
Write-offs2	(151.8)		(108.8)		(399.0)
Allowance for credit loss, end of period	$	265.3	$	344.7	$	356.2

1Represents the incremental increase in other underwriting expenses.

2Represents portion of allowance that is reversed when premiums receivables are written off.

XML

Investments (Tables)

3 Months Ended

Mar. 31, 2021

Investments, Debt and Equity Securities [Abstract]

Schedule of Debt and Equity Securities Reconciliation

The following tables present the composition of our investment portfolio by major security type, consistent with our classification of how we manage, monitor, and measure the portfolio. Our securities are reported in our consolidated balance sheets at fair value. The changes in fair value for our fixed-maturity securities (other than hybrid securities) are reported as a component of accumulated other comprehensive income, net of deferred income taxes, in our consolidated balance sheets. The net holding period gains (losses) reported below represent the inception-to-date changes in fair value of the securities. The changes in the net holding period gains (losses) between periods for the hybrid securities and equity securities are recorded as a component of net realized gains (losses) on securities in our consolidated statements of comprehensive income.

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
March 31, 2021
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	16,002.7	$	181.7	$	(111.0)	$	0	$	16,073.4	33.9	%
State and local government obligations	2,574.8		65.3		(16.0)		0		2,624.1		5.6
Corporate debt securities	10,095.2		368.1		(24.0)		(3.1)		10,436.2		22.0
Residential mortgage-backed securities	548.3		5.7		(0.8)		0		553.2		1.2
Commercial mortgage-backed securities	5,868.3		68.8		(45.1)		0		5,892.0		12.4
Other asset-backed securities	3,293.5		30.6		(0.7)		0		3,323.4		7.0
Redeemable preferred stocks	181.2		2.9		(2.0)		7.4		189.5		0.4
Total fixed maturities	38,564.0		723.1		(199.6)		4.3		39,091.8		82.5
Short-term investments	2,243.1		0		0		0		2,243.1		4.7
Total available-for-sale securities	40,807.1		723.1		(199.6)		4.3		41,334.9		87.2
Equity securities:
Nonredeemable preferred stocks	1,453.9		0		0		53.3		1,507.2		3.2
Common equities	1,204.5		0		0		3,354.0		4,558.5		9.6
Total equity securities	2,658.4		0		0		3,407.3		6,065.7		12.8
Total portfolio1	$	43,465.5	$	723.1	$	(199.6)	$	3,411.6	$	47,400.6	100.0	%

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
March 31, 2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	10,841.2	$	654.5	$	0	$	0	$	11,495.7	28.5	%
State and local government obligations	2,243.9		64.8		(4.5)		0		2,304.2		5.7
Corporate debt securities	9,452.9		160.8		(120.1)		(1.7)		9,491.9		23.5
Residential mortgage-backed securities	574.3		1.5		(19.2)		0		556.6		1.4
Commercial mortgage-backed securities	5,822.4		30.2		(188.3)		0		5,664.3		14.0
Other asset-backed securities	4,674.9		4.3		(40.0)		(0.1)		4,639.1		11.5
Redeemable preferred stocks	151.5		0		(5.1)		(21.6)		124.8		0.3
Total fixed maturities	33,761.1		916.1		(377.2)		(23.4)		34,276.6		84.9
Short-term investments	2,524.2		0		0		0		2,524.2		6.3
Total available-for-sale securities	36,285.3		916.1		(377.2)		(23.4)		36,800.8		91.2
Equity securities:
Nonredeemable preferred stocks	1,017.5		0		0		(84.1)		933.4		2.3
Common equities	1,113.2		0		0		1,494.9		2,608.1		6.5
Total equity securities	2,130.7		0		0		1,410.8		3,541.5		8.8
Total portfolio1	$	38,416.0	$	916.1	$	(377.2)	$	1,387.4	$	40,342.3	100.0	%

($ in millions)	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Net Holding Period Gains (Losses)		Fair Value		% of Total Fair Value
December 31, 2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	12,437.9	$	305.8	$	(3.7)	$	0	$	12,740.0	26.8	%
State and local government obligations	3,099.4		123.1		(0.7)		0		3,221.8		6.8
Corporate debt securities	9,579.7		601.7		(0.1)		3.9		10,185.2		21.4
Residential mortgage-backed securities	503.3		7.1		(0.9)		0		509.5		1.1
Commercial mortgage-backed securities	6,042.6		142.5		(10.0)		0		6,175.1		13.0
Other asset-backed securities	3,745.0		40.1		(0.5)		0		3,784.6		7.9
Redeemable preferred stocks	181.2		3.6		(1.4)		11.3		194.7		0.4
Total fixed maturities	35,589.1		1,223.9		(17.3)		15.2		36,810.9		77.4
Short-term investments	5,218.5		0		0		0		5,218.5		11.0
Total available-for-sale securities	40,807.6		1,223.9		(17.3)		15.2		42,029.4		88.4
Equity securities:
Nonredeemable preferred stocks	1,358.7		0		0		89.2		1,447.9		3.1
Common equities	1,187.3		0		0		2,865.7		4,053.0		8.5
Total equity securities	2,546.0		0		0		2,954.9		5,500.9		11.6
Total portfolio1	$	43,353.6	$	1,223.9	$	(17.3)	$	2,970.1	$	47,530.3	100.0	%

1Our portfolio reflects the effect of net unsettled security transactions; at March 31, 2021, we had $363.1 million in other liabilities, compared to $598.0 million and $95.5 million at March 31, 2020 and December 31, 2020, respectively.

The total fair value of the portfolio at March 31, 2021 and 2020, and December 31, 2020, included $3.7 billion, $2.6 billion, and $6.2 billion, respectively, of securities held in a consolidated, non-insurance subsidiary of the holding company, net of unsettled security transactions. During the first quarter 2021, we used a portion of these investments to pay our fourth quarter and annual 2020 common share dividends.

Hybrid Instruments Table

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:

	March 31,
(millions)	2021		2020		December 31, 2020
Fixed Maturities:
State and local government obligations	$	0	$	3.4	$	0
Corporate debt securities	295.0		116.5		188.4
Residential mortgage-backed securities	35.0		0		0
Other asset-backed securities	31.9		2.2		34.8
Redeemable preferred stocks	127.5		68.4		131.4
Total hybrid securities	$	489.4	$	190.5	$	354.6

Investments Classified by Contractual Maturity Date

The composition of fixed maturities by maturity at March 31, 2021, was:

(millions)	Cost		Fair Value
Less than one year	$	4,918.5	$	4,940.6
One to five years	24,370.8		24,814.6
Five to ten years	9,214.5		9,277.3
Ten years or greater	60.2		59.3
Total	$	38,564.0	$	39,091.8

Schedule of Unrealized Loss on Investments

The following tables show the composition of gross unrealized losses, for which no credit related impairment has been recognized, 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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
March 31, 2021
U.S. government obligations	36	$	8,612.2	$	(111.0)	35	$	8,598.6	$	(109.7)	1	$	13.6	$	(1.3)
State and local government obligations	92	816.0		(16.0)		92	816.0		(16.0)		0	0		0
Corporate debt securities	79	1,751.4		(24.0)		76	1,698.4		(23.9)		3	53.0		(0.1)
Residential mortgage-backed securities	21	123.4		(0.8)		6	94.4		(0.2)		15	29.0		(0.6)
Commercial mortgage-backed securities	95	2,542.2		(45.1)		77	2,023.9		(41.7)		18	518.3		(3.4)
Other asset-backed securities	43	505.8		(0.7)		36	477.6		(0.5)		7	28.2		(0.2)
Redeemable preferred stocks	1	10.5		(2.0)		0	0		0		1	10.5		(2.0)
Total fixed maturities	367	$	14,361.5	$	(199.6)	322	$	13,708.9	$	(192.0)	45	$	652.6	$	(7.6)

	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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
March 31, 2020
U.S. government obligations	1	$	100.3	$	0	1	$	100.3	$	0	0	$	0	$	0
State and local government obligations	89	528.4		(4.5)		78	507.7		(4.4)		11	20.7		(0.1)
Corporate debt securities	233	4,205.6		(120.1)		233	4,205.6		(120.1)		0	0		0
Residential mortgage-backed securities	70	532.5		(19.2)		46	425.0		(11.9)		24	107.5		(7.3)
Commercial mortgage-backed securities	204	4,441.5		(188.3)		187	4,109.2		(173.8)		17	332.3		(14.5)
Other asset-backed securities	216	3,558.1		(40.0)		201	3,514.2		(39.0)		15	43.9		(1.0)
Redeemable preferred stocks	4	56.3		(5.1)		3	45.2		(3.8)		1	11.1		(1.3)
Total fixed maturities	817	$	13,422.7	$	(377.2)	749	$	12,907.2	$	(353.0)	68	$	515.5	$	(24.2)

	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		Unrealized Losses		No. of Sec.	Fair  Value		Unrealized Losses
December 31, 2020
U.S. government obligations	9	$	1,511.0	$	(3.7)	9	$	1,511.0	$	(3.7)	0	$	0	$	0
State and local government obligations	30	208.7		(0.7)		30	208.7		(0.7)		0	0		0
Corporate debt securities	7	129.4		(0.1)		7	129.4		(0.1)		0	0		0
Residential mortgage-backed securities	21	44.4		(0.9)		0	0		0		21	44.4		(0.9)
Commercial mortgage-backed securities	43	893.3		(10.0)		9	93.6		(0.3)		34	799.7		(9.7)
Other asset-backed securities	22	183.7		(0.5)		9	74.4		(0.1)		13	109.3		(0.4)
Redeemable preferred stocks	1	11.0		(1.4)		0	0		0		1	11.0		(1.4)
Total fixed maturities	133	$	2,981.5	$	(17.3)	64	$	2,017.1	$	(4.9)	69	$	964.4	$	(12.4)

Realized Gain (Loss) on Investments

The components of net realized gains (losses) for the three months ended March 31, were:

	Three Months
(millions)	2021		2020
Gross realized gains on security sales
Available-for-sale securities:
U.S. government obligations	$	66.6	$	251.1
State and local government obligations	30.2		2.0
Corporate and other debt securities	20.7		32.4
Commercial mortgage-backed securities	29.8		6.1
Other asset-backed securities	0.7		0
Total available-for-sale securities	148.0		291.6
Equity securities:
Nonredeemable preferred stocks	17.3		19.6
Common equities	1.1		66.0
Total equity securities	18.4		85.6
Subtotal gross realized gains on security sales	166.4		377.2
Gross realized losses on security sales
Available-for-sale securities:
U.S. government obligations	(19.6)		(2.7)
State and local government obligations	(0.2)		0
Corporate and other debt securities	(2.1)		(1.0)
Commercial mortgage-backed securities	(0.6)		0
Other asset-backed securities	(0.1)		0
Total available-for-sale securities	(22.6)		(3.7)
Equity securities:
Nonredeemable preferred stocks	0		(4.4)
Common equities	0		(53.9)
Total equity securities	0		(58.3)
Subtotal gross realized losses on security sales	(22.6)		(62.0)
Net realized gains (losses) on security sales
Available-for-sale securities:
U.S. government obligations	47.0		248.4
State and local government obligations	30.0		2.0
Corporate and other debt securities	18.6		31.4
Commercial mortgage-backed securities	29.2		6.1
Other asset-backed securities	0.6		0
Total available-for-sale securities	125.4		287.9
Equity securities:
Nonredeemable preferred stocks	17.3		15.2
Common equities	1.1		12.1
Total equity securities	18.4		27.3
Subtotal net realized gains (losses) on security sales	143.8		315.2
Net holding period gains (losses)
Hybrid securities	(10.9)		(31.2)
Equity securities	452.4		(837.6)
Subtotal net holding period gains (losses)	441.5		(868.8)
Total net realized gains (losses) on securities	$	585.3	$	(553.6)

Components of Equity Realized Gains (Losses)

The following table reflects our holding period realized gains (losses) on equity securities recognized for the three months ended March 31, 2021 and 2020, for equity securities held at the respective quarter end:

	Three Months
(millions)	2021		2020
Total net gains (losses) recognized during the period on equity securities	$	470.8	$	(810.3)
Less: Net gains (losses) recognized on equity securities sold during the period	18.4		27.3
Net holding period gains (losses) recognized during the period on equity securities held at period end	$	452.4	$	(837.6)

Components of Net Investment Income

The components of net investment income for the three months ended March 31, were: 

	Three Months
(millions)	2021		2020
Available-for-sale securities:
Fixed maturities:
U.S. government obligations	$	30.4	$	62.6
State and local government obligations	13.4		9.6
Corporate debt securities	85.2		58.0
Residential mortgage-backed securities	3.4		4.2
Commercial mortgage-backed securities	35.8		34.3
Other asset-backed securities	15.9		29.2
Redeemable preferred stocks	2.5		7.9
Total fixed maturities	186.6		205.8
Short-term investments	1.5		7.0
Total available-for-sale securities	188.1		212.8
Equity securities:
Nonredeemable preferred stocks	17.9		13.8
Common equities	14.2		14.6
Total equity securities	32.1		28.4
Investment income	220.2		241.2
Investment expenses	(5.6)		(5.3)
Net investment income	$	214.6	$	235.9

XML

Fair Value (Tables)

3 Months Ended

Mar. 31, 2021

Fair Value Disclosures [Abstract]

Composition of Investment Portfolio by Major Security Type

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
March 31, 2021
Fixed maturities:
U.S. government obligations	$	16,073.4	$	0	$	0	$	16,073.4	$	16,002.7
State and local government obligations	0		2,624.1		0		2,624.1		2,574.8
Corporate debt securities	0		10,436.2		0		10,436.2		10,095.2
Subtotal	16,073.4		13,060.3		0		29,133.7		28,672.7
Asset-backed securities:
Residential mortgage-backed	0		553.2		0		553.2		548.3
Commercial mortgage-backed	0		5,892.0		0		5,892.0		5,868.3
Other asset-backed	0		3,323.4		0		3,323.4		3,293.5
Subtotal asset-backed securities	0		9,768.6		0		9,768.6		9,710.1
Redeemable preferred stocks:
Financials	0		50.6		0		50.6		51.0
Utilities	0		11.4		0		11.4		10.0
Industrials	10.6		116.9		0		127.5		120.2
Subtotal redeemable preferred stocks	10.6		178.9		0		189.5		181.2
Total fixed maturities	16,084.0		23,007.8		0		39,091.8		38,564.0
Short-term investments	2,227.8		15.3		0		2,243.1		2,243.1
Total available-for-sale securities	18,311.8		23,023.1		0		41,334.9		40,807.1
Equity securities:
Nonredeemable preferred stocks:
Financials	113.8		1,274.7		35.0		1,423.5		1,373.9
Utilities	0		41.9		0		41.9		39.9
Industrials	0		25.2		16.6		41.8		40.1
Subtotal nonredeemable preferred stocks	113.8		1,341.8		51.6		1,507.2		1,453.9
Common equities:
Common stocks	4,555.3		0		0		4,555.3		1,201.3
Other risk investments	0		0		3.2		3.2		3.2
Subtotal common equities	4,555.3		0		3.2		4,558.5		1,204.5
Total equity securities	4,669.1		1,341.8		54.8		6,065.7		2,658.4
Total portfolio	$	22,980.9	$	24,364.9	$	54.8	$	47,400.6	$	43,465.5
Debt	$	0	$	6,195.2	$	0	$	6,195.2	$	5,396.8

	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
March 31, 2020
Fixed maturities:
U.S. government obligations	$	11,495.7	$	0	$	0	$	11,495.7	$	10,841.2
State and local government obligations	0		2,304.2		0		2,304.2		2,243.9
Corporate debt securities	0		9,491.9		0		9,491.9		9,452.9
Subtotal	11,495.7		11,796.1		0		23,291.8		22,538.0
Asset-backed securities:
Residential mortgage-backed	0		556.6		0		556.6		574.3
Commercial mortgage-backed	0		5,664.3		0		5,664.3		5,822.4
Other asset-backed	0		4,639.1		0		4,639.1		4,674.9
Subtotal asset-backed securities	0		10,860.0		0		10,860.0		11,071.6
Redeemable preferred stocks:
Financials	0		47.2		0		47.2		51.4
Utilities	0		9.2		0		9.2		10.0
Industrials	7.3		61.1		0		68.4		90.1
Subtotal redeemable preferred stocks	7.3		117.5		0		124.8		151.5
Total fixed maturities	11,503.0		22,773.6		0		34,276.6		33,761.1
Short-term investments	2,438.4		85.8		0		2,524.2		2,524.2
Total available-for-sale securities	13,941.4		22,859.4		0		36,800.8		36,285.3
Equity securities:
Nonredeemable preferred stocks:
Financials	105.5		752.3		13.1		870.9		937.4
Utilities	0		32.0		0		32.0		40.0
Industrials	0		15.3		15.2		30.5		40.1
Subtotal nonredeemable preferred stocks	105.5		799.6		28.3		933.4		1,017.5
Common equities:
Common stocks	2,607.8		0		0		2,607.8		1,112.9
Other risk investments	0		0		0.3		0.3		0.3
Subtotal common equities	2,607.8		0		0.3		2,608.1		1,113.2
Total equity securities	2,713.3		799.6		28.6		3,541.5		2,130.7
Total portfolio	$	16,654.7	$	23,659.0	$	28.6	$	40,342.3	$	38,416.0
Debt	$	0	$	6,108.6	$	0	$	6,108.6	$	5,394.0

	Fair Value
(millions)	Level 1		Level 2		Level 3		Total		Cost
December 31, 2020
Fixed maturities:
U.S. government obligations	$	12,740.0	$	0	$	0	$	12,740.0	$	12,437.9
State and local government obligations	0		3,221.8		0		3,221.8		3,099.4
Corporate debt securities	0		10,185.2		0		10,185.2		9,579.7
Subtotal	12,740.0		13,407.0		0		26,147.0		25,117.0
Asset-backed securities:
Residential mortgage-backed	0		509.5		0		509.5		503.3
Commercial mortgage-backed	0		6,175.1		0		6,175.1		6,042.6
Other asset-backed	0		3,784.6		0		3,784.6		3,745.0
Subtotal asset-backed securities	0		10,469.2		0		10,469.2		10,290.9
Redeemable preferred stocks:
Financials	0		51.6		0		51.6		51.1
Utilities	0		11.7		0		11.7		10.0
Industrials	10.8		120.6		0		131.4		120.1
Subtotal redeemable preferred stocks	10.8		183.9		0		194.7		181.2
Total fixed maturities	12,750.8		24,060.1		0		36,810.9		35,589.1
Short-term investments	4,704.9		513.6		0		5,218.5		5,218.5
Total available-for-sale securities	17,455.7		24,573.7		0		42,029.4		40,807.6
Equity securities:
Nonredeemable preferred stocks:
Financials	117.7		1,212.3		35.0		1,365.0		1,278.6
Utilities	0		41.9		0		41.9		40.0
Industrials	0		24.3		16.7		41.0		40.1
Subtotal nonredeemable preferred stocks	117.7		1,278.5		51.7		1,447.9		1,358.7
Common equities:
Common stocks	4,049.9		0		0		4,049.9		1,184.2
Other risk investments	0		0		3.1		3.1		3.1
Subtotal common equities	4,049.9		0		3.1		4,053.0		1,187.3
Total equity securities	4,167.6		1,278.5		54.8		5,500.9		2,546.0
Total portfolio	$	21,623.3	$	25,852.2	$	54.8	$	47,530.3	$	43,353.6
Debt	$	0	$	6,793.5	$	0	$	6,793.5	$	5,396.1

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The following tables provide a summary of changes in fair value associated with Level 3 assets for the three months ended March 31, 2021 and 2020:

	Level 3 Fair Value
(millions)	Fair Value at December 31, 2020		Calls/ Maturities/ Paydowns		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation		Net Transfers In (Out)		Fair Value at March 31, 2021
Equity securities:
Nonredeemable preferred stocks:
Financials	$	35.0	$	0	$	0	$	0	$	0	$	0	$	0	$	35.0
Industrials	16.7		0		0		0		0		(0.1)		0		16.6
Common equities:
Other risk investments	3.1		0		0.1		0		0		0		0		3.2
Total Level 3 securities	$	54.8	$	0	$	0.1	$	0	$	0	$	(0.1)	$	0	$	54.8

	Level 3 Fair Value
(millions)	Fair Value at December 31, 2019		Calls/ Maturities/ Paydowns		Purchases		Sales		Net Realized (Gain)/Loss on Sales		Change in Valuation		Net Transfers In (Out)		Fair Value at March 31, 2020
Equity securities:
Nonredeemable preferred stocks:
Financials	$	27.1	$	0	$	0	$	0	$	0	$	(14.0)	$	0	$	13.1
Industrials	16.0		0		0		0		0		$	(0.8)	0		15.2
Common equities:
Other risk investments	0.3		0		0		0		0		0		0		0.3
Total Level 3 securities	$	43.4	$	0	$	0	$	0	$	0	$	(14.8)	$	0	$	28.6

Fair Value Measurement Inputs and Valuation Techniques

The following tables provide a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at March 31, 2021 and 2020, and December 31, 2020:

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at March 31, 2021		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials1	$	25.0	Internal price	Unadjusted purchase price per share	3.7
Financials2	10.0		Internal price	Unadjusted purchase price per share	16.9
Industrials	6.9		Pricing firm	Market approach (guideline public company method)	5.4
Industrials	9.7		Pricing firm	Market approach (guideline public company method)	4.8
Subtotal Level 3 securities	51.6
Pricing exemption securities	3.2
Total Level 3 securities	$	54.8

1 This security was purchased in May 2020.

2 This security was purchased in November 2020.

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at March 31, 2020		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials	$	13.1	Internal price	Market approach (guideline public company method)	4.4
Industrials1	7.1		Internal price	Market approach (guideline public company method)	5.6
Industrials1	8.1		Internal price	Market approach (guideline public company method)	4.0
Subtotal Level 3 securities	28.3
Pricing exemption securities	0.3
Total Level 3 securities	$	28.6

1Modified prior year disclosure to present securities individually to conform to the current year presentation.

	Quantitative Information about Level 3 Fair Value Measurements
($ in millions)	Fair Value at December 31, 2020		Valuation Technique	Unobservable Input	Unobservable Input Assumption
Equity securities:
Nonredeemable preferred stocks:
Financials1	$	25.0	Internal price	Unadjusted purchase price per share	3.7
Financials2	10.0		Internal price	Unadjusted purchase price per share	16.9
Industrials	6.9		Pricing firm	Market approach (guideline public company method)	5.4
Industrials	9.8		Pricing firm	Market approach (guideline public company method)	4.8
Subtotal Level 3 securities	51.7
Pricing exemption securities	3.1
Total Level 3 securities	$	54.8

1 This security was purchased in May 2020.

2 This security was purchased in November 2020.

XML

Debt (Tables)

3 Months Ended

Mar. 31, 2021

Debt Disclosure [Abstract]

Debt Table

Debt at each of the balance sheet periods consisted of:

	March 31, 2021				March 31, 2020				December 31, 2020
(millions)	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
3.75% Senior Notes due 2021 (issued: $500.0, August 2011)	$	499.9	$	506.7	$	499.5	$	510.7	$	499.8	$	510.9
2.45% Senior Notes due 2027 (issued: $500.0, August 2016)	497.4		526.8		497.0		488.2		497.3		541.1
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999)	297.0		386.1		296.7		395.3		296.9		409.4
4.00% Senior Notes due 2029 (issued: $550.0, October 2018)	545.6		623.7		545.1		605.7		545.5		660.4
3.20% Senior Notes due 2030 (issued: $500.0, March 2020)	496.2		536.7		495.8		543.2		496.1		575.5
6.25% Senior Notes due 2032 (issued: $400.0, November 2002)	396.0		531.4		395.8		539.6		396.0		582.0
4.35% Senior Notes due 2044 (issued: $350.0, April 2014)	346.8		413.9		346.7		391.7		346.7		459.7
3.70% Senior Notes due 2045 (issued: $400.0, January 2015)	395.6		430.2		395.4		406.2		395.5		481.0
4.125% Senior Notes due 2047 (issued: $850.0, April 2017)	841.7		977.1		841.6		991.9		841.7		1,113.1
4.20% Senior Notes due 2048 (issued: $600.0, March 2018)	590.0		698.7		589.9		675.8		590.0		806.7
3.95% Senior Notes due 2050 (issued: $500.0, March 2020)	490.6		563.9		490.5		560.3		490.6		653.7
Total	$	5,396.8	$	6,195.2	$	5,394.0	$	6,108.6	$	5,396.1	$	6,793.5

XML

Loss and Loss Adjustment Expense Reserves (Tables)

3 Months Ended

Mar. 31, 2021

Loss and Loss Adjustment Expenses Reserves [Abstract]

Schedule of Liability for Unpaid Claims and Claims Adjustment Expense

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

	March 31,
(millions)	2021		2020
Balance at January 1	$	20,265.8	$	18,105.4
Less reinsurance recoverables on unpaid losses	3,798.2		3,212.2
Net balance at January 1	16,467.6		14,893.2
Incurred related to:
Current year	6,986.1		6,011.1
Prior years	124.4		144.1
Total incurred	7,110.5		6,155.2
Paid related to:
Current year	3,029.3		2,916.4
Prior years	3,453.7		3,269.2
Total paid	6,483.0		6,185.6
Net balance at March 31	17,095.1		14,862.8
Plus reinsurance recoverables on unpaid losses	3,968.6		3,443.7
Balance at March 31	$	21,063.7	$	18,306.5

XML

Supplemental Cash Flow Information (Tables)

3 Months Ended

Mar. 31, 2021

Supplemental Cash Flow Elements [Abstract]

Supplemental Cash Flow Information Table

We paid the following in the respective periods: 

	Three Months Ended March 31,
(millions)	2021		2020
Income taxes	$	0.8	$	0
Interest	74.3		56.4
Operating lease liabilities	24.5		22.7

XML

Segment Information (Tables)

3 Months Ended

Mar. 31, 2021

Segment Reporting [Abstract]

Reconciliation of Revenue and operating Income from Segments to Consolidated

Following are the operating results for the respective periods:

	Three Months Ended March 31,
	2021				2020
(millions)	Revenues		Pretax Profit (Loss)		Revenues		Pretax Profit (Loss)
Personal Lines
Agency	$	4,098.2	$	547.5	$	3,828.7	$	601.6
Direct	4,431.7		414.6		3,992.4		473.0
Total Personal Lines1	8,529.9		962.1		7,821.1		1,074.6
Commercial Lines	1,417.8		228.5		1,189.0		112.5
Property2	472.5		(70.7)		420.6		49.2
Total underwriting operations	10,420.2		1,119.9		9,430.7		1,236.3
Fees and other revenues3	165.7		NA		153.5		NA
Service businesses	53.8		4.5		51.6		4.1
Investments4	805.5		799.9		(312.4)		(317.7)
Interest expense	NA		(56.4)		NA		(48.0)
Consolidated total	$	11,445.2	$	1,867.9	$	9,323.4	$	874.7

NA = Not applicable

1 Personal auto insurance accounted for 94% of the total Personal Lines segment net premiums earned during the three months ended March 31, 2021 and 2020; insurance for our special lines products (e.g., motorcycles, ATVs, RVs, watercraft, and snowmobiles) accounted for the balance of the Personal Lines net premiums earned.

2 For the three months ended March 31, 2021 and 2020, pretax profit (loss) includes $14.2 million and $14.5 million, respectively, of amortization expense predominately associated with intangible assets. See Note 12 – Goodwill and Intangible Assets for further discussion.

3 Pretax profit (loss) for fees and other revenues is allocated to operating segments.

4 Revenues represent recurring investment income and total net realized gains (losses) on securities; pretax profit is net of investment expense.

Underwriting Margins and Combined Ratios for our Underwriting Operations

Following are the underwriting margins and combined ratios for our underwriting operations for the respective periods:

	Three Months Ended March 31,
	2021			2020
	Underwriting Margin		Combined Ratio	Underwriting Margin		Combined Ratio
Personal Lines
Agency	13.4	%	86.6	15.7	%	84.3
Direct	9.4		90.6	11.9		88.1
Total Personal Lines	11.3		88.7	13.7		86.3
Commercial Lines	16.1		83.9	9.5		90.5
Property1	(15.0)		115.0	11.7		88.3
Total underwriting operations	10.7		89.3	13.1		86.9

1 Included in the three months ended March 31, 2021 and 2020, is 3.0 points and 3.4 points, respectively, of amortization expense predominately associated with intangible assets.

XML

Dividends (Tables)

3 Months Ended

Mar. 31, 2021

Dividends [Abstract]

Dividends

Following is a summary of our common and preferred share dividends that were declared and/or paid during the three months ended March 31, 2021 and 2020:

(millions, except per share amounts)		Amount
Declared	Payable	Per Share		Accrued1
Common - Quarterly Dividends:
March 2021	April 2021	$	0.10	$	58.5
December 2020	January 2021	0.10		58.6
February 2020	April 2020	0.10		58.5
December 2019	January 2020	0.10		58.5
Common - Annual Variable Dividends:
December 2020	January 2021	4.50		2,635.9
December 2019	January 2020	2.25		1,316.9
Preferred Dividends:
December 2020	March 2021	26.875		13.4
February 2020	March 2020	26.875		13.4

1 The accrual is based on an estimate of shares outstanding as of the record date. The dividends accrued at March 31, 2020, were reclassified from accounts payable, accrued expenses, and other liabilities into dividends payable on common shares on the consolidated balance sheets, to conform to the current year presentation.

XML

Other Comprehensive Income (Loss) (Tables)

3 Months Ended

Mar. 31, 2021

Equity [Abstract]

Components of 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 gains (losses) on forecasted transactions		(Income) loss attributable to NCI
Balance at December 31, 2020	$	1,187.4	$	(255.7)	$	931.7	$	947.3	$	(15.6)	$	0
Other comprehensive income (loss) before reclassifications:
Investment securities	(551.4)		115.8		(435.6)		(435.6)		0		0
Loss attributable to noncontrolling interest (NCI)	0		0		0		0		0		0
Total other comprehensive income (loss) before reclassifications	(551.4)		115.8		(435.6)		(435.6)		0		0
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
Net realized gains (losses) on securities	131.7		(27.7)		104.0		104.0		0		0
Interest expense	(0.3)		0.1		(0.2)		0		(0.2)		0
Total reclassification adjustment for amounts realized in net income	131.4		(27.6)		103.8		104.0		(0.2)		0
Total other comprehensive income (loss)	(682.8)		143.4		(539.4)		(539.6)		0.2		0
Balance at March 31, 2021	$	504.6	$	(112.3)	$	392.3	$	407.7	$	(15.4)	$	0

							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 gains (losses) on forecasted transactions		(Income) loss attributable to NCI
Balance at December 31, 2019	$	435.7	$	(94.0)	$	341.7	$	360.8	$	(16.4)	$	(2.7)
Other comprehensive income (loss) before reclassifications:
Investment securities	318.2		(66.8)		251.4		251.4		0		0
Loss attributable to noncontrolling interest (NCI)	(0.6)		0.1		(0.5)		0		0		(0.5)
Total other comprehensive income (loss) before reclassifications	317.6		(66.7)		250.9		251.4		0		(0.5)
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
Net realized gains (losses) on securities	238.7		(50.1)		188.6		188.6		0		0
Interest expense	(0.3)		0.1		(0.2)		0		(0.2)		0
Total reclassification adjustment for amounts realized in net income	238.4		(50.0)		188.4		188.6		(0.2)		0
Total other comprehensive income (loss)	79.2		(16.7)		62.5		62.8		0.2		(0.5)
Balance at March 31, 2020	$	514.9	$	(110.7)	$	404.2	$	423.6	$	(16.2)	$	(3.2)

XML

Goodwill and Intangible Assets (Tables)

3 Months Ended

Mar. 31, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Indefinite-Lived Intangible Assets

The following table is a summary of the net carrying amount of other intangible assets:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Intangible assets subject to amortization	$	144.8	$	201.4	$	159.0
Indefinite-lived intangible assets1	12.4		12.4		12.4
Total	$	157.2	$	213.8	$	171.4

1 Indefinite-lived intangible assets are comprised of state insurance and agent licenses. State insurance licenses were previously subject to amortization under superseded accounting guidance and have $0.6 million of accumulated amortization for all periods presented.

Intangible Assets Subject to Amortization

The following table is a summary of the net carrying amount of other intangible assets:

(millions)	March 31, 2021		March 31, 2020		December 31, 2020
Intangible assets subject to amortization	$	144.8	$	201.4	$	159.0
Indefinite-lived intangible assets1	12.4		12.4		12.4
Total	$	157.2	$	213.8	$	171.4

1 Indefinite-lived intangible assets are comprised of state insurance and agent licenses. State insurance licenses were previously subject to amortization under superseded accounting guidance and have $0.6 million of accumulated amortization for all periods presented.

Intangible assets subject to amortization consisted of the following:

	March 31, 2021						March 31, 2020						December 31, 2020
(millions)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Category:
Policies in force	$	256.2	$	219.6	$	36.6	$	256.2	$	183.0	$	73.2	$	256.2	$	210.4	$	45.8
Agency relationships	159.2		68.3		90.9		159.2		56.9		102.3		159.2		65.4		93.8
Software rights	69.1		51.8		17.3		79.1		53.2		25.9		69.1		49.7		19.4
Trade name	0		0		0		34.8		34.8		0		0		0		0
Total	$	484.5	$	339.7	$	144.8	$	529.3	$	327.9	$	201.4	$	484.5	$	325.5	$	159.0

XML

Basis of Presentation - Reporting and Accounting Policies - Allowance for Credit Loss (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Allowance for Credit Loss [Abstract]
Premium Receivable, Allowance for Credit Loss, Beginning Balance	$ 356.2	$ 283.2	$ 283.2
Increase in allowance	60.9	170.3	472.0
Write-offs	(151.8)	(108.8)	(399.0)
Allowance for credit loss, end of period	$ 265.3	$ 344.7	$ 356.2

XML

Basis of Presentation Basis of Presentation-Additional Information (Details) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Assets held-for-sale	$ 55.1	$ 56.6	$ 31.8

XML

Investments Investment Portfolio by Major Security Type (Detail) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 40,807.1	$ 40,807.6	$ 36,285.3
Gross Unrealized Gains	723.1	1,223.9	916.1
Gross Unrealized Losses	(199.6)	(17.3)	(377.2)
Net Holding Period Gains (Losses)	4.3	15.2	(23.4)
Total available-for-sale securities	$ 41,334.9	$ 42,029.4	$ 36,800.8
% of Total Fair Value	87.20%	88.40%	91.20%
Equity securities, at Fair Value
Cost	$ 2,658.4	$ 2,546.0	$ 2,130.7
Gross Unrealized Gains	0.0	0.0	0.0
Gross Unrealized Losses	0.0	0.0	0.0
Net Holding Period Gains (Losses)	3,407.3	2,954.9	1,410.8
Fair Value	$ 6,065.7	$ 5,500.9	$ 3,541.5
% of Total Fair Value	12.80%	11.60%	8.80%
Debt and Equity Securities, at Fair Value
Cost	$ 43,465.5	$ 43,353.6	$ 38,416.0
Gross Unrealized Gains	723.1	1,223.9	916.1
Gross Unrealized Losses	(199.6)	(17.3)	(377.2)
Net Holding Period Gains (Losses)	3,411.6	2,970.1	1,387.4
Fair Value	$ 47,400.6	$ 47,530.3	$ 40,342.3
% of Total Fair Value	100.00%	100.00%	100.00%
Unsettled security transactions, payable	$ 363.1	$ 95.5	$ 598.0
Total fair value of non-insurance subsidiary portfolio	3,700.0	6,200.0	2,600.0
Nonredeemable preferred stocks
Equity securities, at Fair Value
Cost	1,453.9	1,358.7	1,017.5
Gross Unrealized Gains	0.0	0.0	0.0
Gross Unrealized Losses	0.0	0.0	0.0
Net Holding Period Gains (Losses)	53.3	89.2	(84.1)
Fair Value	$ 1,507.2	$ 1,447.9	$ 933.4
% of Total Fair Value	3.20%	3.10%	2.30%
Common equities
Equity securities, at Fair Value
Cost	$ 1,204.5	$ 1,187.3	$ 1,113.2
Gross Unrealized Gains	0.0	0.0	0.0
Gross Unrealized Losses	0.0	0.0	0.0
Net Holding Period Gains (Losses)	3,354.0	2,865.7	1,494.9
Fair Value	$ 4,558.5	$ 4,053.0	$ 2,608.1
% of Total Fair Value	9.60%	8.50%	6.50%
Total fixed maturities
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 38,564.0	$ 35,589.1	$ 33,761.1
Gross Unrealized Gains	723.1	1,223.9	916.1
Gross Unrealized Losses	(199.6)	(17.3)	(377.2)
Net Holding Period Gains (Losses)	4.3	15.2	(23.4)
Total available-for-sale securities	$ 39,091.8	$ 36,810.9	$ 34,276.6
% of Total Fair Value	82.50%	77.40%	84.90%
Total fixed maturities | U.S. government obligations
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 16,002.7	$ 12,437.9	$ 10,841.2
Gross Unrealized Gains	181.7	305.8	654.5
Gross Unrealized Losses	(111.0)	(3.7)	0.0
Net Holding Period Gains (Losses)	0.0	0.0	0.0
Total available-for-sale securities	$ 16,073.4	$ 12,740.0	$ 11,495.7
% of Total Fair Value	33.90%	26.80%	28.50%
Total fixed maturities | State and local government obligations
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 2,574.8	$ 3,099.4	$ 2,243.9
Gross Unrealized Gains	65.3	123.1	64.8
Gross Unrealized Losses	(16.0)	(0.7)	(4.5)
Net Holding Period Gains (Losses)	0.0	0.0	0.0
Total available-for-sale securities	$ 2,624.1	$ 3,221.8	$ 2,304.2
% of Total Fair Value	5.60%	6.80%	5.70%
Total fixed maturities | Corporate debt securities
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 10,095.2	$ 9,579.7	$ 9,452.9
Gross Unrealized Gains	368.1	601.7	160.8
Gross Unrealized Losses	(24.0)	(0.1)	(120.1)
Net Holding Period Gains (Losses)	(3.1)	3.9	(1.7)
Total available-for-sale securities	$ 10,436.2	$ 10,185.2	$ 9,491.9
% of Total Fair Value	22.00%	21.40%	23.50%
Total fixed maturities | Residential mortgage-backed securities
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 548.3	$ 503.3	$ 574.3
Gross Unrealized Gains	5.7	7.1	1.5
Gross Unrealized Losses	(0.8)	(0.9)	(19.2)
Net Holding Period Gains (Losses)	0.0	0.0	0.0
Total available-for-sale securities	$ 553.2	$ 509.5	$ 556.6
% of Total Fair Value	1.20%	1.10%	1.40%
Total fixed maturities | Commercial mortgage-backed securities
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 5,868.3	$ 6,042.6	$ 5,822.4
Gross Unrealized Gains	68.8	142.5	30.2
Gross Unrealized Losses	(45.1)	(10.0)	(188.3)
Net Holding Period Gains (Losses)	0.0	0.0	0.0
Total available-for-sale securities	$ 5,892.0	$ 6,175.1	$ 5,664.3
% of Total Fair Value	12.40%	13.00%	14.00%
Total fixed maturities | Other asset-backed securities
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 3,293.5	$ 3,745.0	$ 4,674.9
Gross Unrealized Gains	30.6	40.1	4.3
Gross Unrealized Losses	(0.7)	(0.5)	(40.0)
Net Holding Period Gains (Losses)	0.0	0.0	(0.1)
Total available-for-sale securities	$ 3,323.4	$ 3,784.6	$ 4,639.1
% of Total Fair Value	7.00%	7.90%	11.50%
Total fixed maturities | Redeemable preferred stocks
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 181.2	$ 181.2	$ 151.5
Gross Unrealized Gains	2.9	3.6	0.0
Gross Unrealized Losses	(2.0)	(1.4)	(5.1)
Net Holding Period Gains (Losses)	7.4	11.3	(21.6)
Total available-for-sale securities	$ 189.5	$ 194.7	$ 124.8
% of Total Fair Value	0.40%	0.40%	0.30%
Short-term investments
Debt Securities, Available-for-Sale, at Fair Value
Cost	$ 2,243.1	$ 5,218.5	$ 2,524.2
Gross Unrealized Gains	0.0	0.0	0.0
Gross Unrealized Losses	0.0	0.0	0.0
Net Holding Period Gains (Losses)	0.0	0.0	0.0
Total available-for-sale securities	$ 2,243.1	$ 5,218.5	$ 2,524.2
% of Total Fair Value	4.70%	11.00%	6.30%

XML

Investments Hybrid Securities (Detail) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Hybrid Instruments [Line Items]
Hybrid securities	$ 489.4	$ 354.6	$ 190.5
State and local government obligations
Hybrid Instruments [Line Items]
Hybrid securities	0.0	0.0	3.4
Corporate debt securities
Hybrid Instruments [Line Items]
Hybrid securities	295.0	188.4	116.5
Residential mortgage-backed securities
Hybrid Instruments [Line Items]
Hybrid securities	35.0	0.0	0.0
Other asset-backed securities
Hybrid Instruments [Line Items]
Hybrid securities	31.9	34.8	2.2
Redeemable preferred stocks
Hybrid Instruments [Line Items]
Hybrid securities	$ 127.5	$ 131.4	$ 68.4

XML

Investments Composition of Fixed Maturities by Maturity (Detail) - Total fixed maturities $ in Millions	Mar. 31, 2021 USD ($)
Debt Securities, Available-for-sale, Maturity, Allocated and Single Maturity Date, Amortized Cost [Abstract]
Less than one year	$ 4,918.5
One to five years	24,370.8
Five to ten years	9,214.5
Ten years or greater	60.2
Cost	38,564.0
Fair Value
Less than one year	4,940.6
One to five years	24,814.6
Five to ten years	9,277.3
Ten years or greater	59.3
Fair Value	$ 39,091.8

XML

Investments Gross Unrealized losses by Major Security (Detail) $ in Millions	Mar. 31, 2021 USD ($) security	Dec. 31, 2020 USD ($) security	Mar. 31, 2020 USD ($) security
Number of Securities
Total | security	367	133	817
Less than 12 Months | security	322	64	749
12 Months or Greater | security	45	69	68
Fair Value
Total	$ 14,361.5	$ 2,981.5	$ 13,422.7
Less than 12 Months	13,708.9	2,017.1	12,907.2
12 Months or Greater	652.6	964.4	515.5
Unrealized Losses
Total	(199.6)	(17.3)	(377.2)
Less than 12 Months	(192.0)	(4.9)	(353.0)
12 Months or Greater	$ (7.6)	$ (12.4)	$ (24.2)
U.S. government obligations
Number of Securities
Total | security	36	9	1
Less than 12 Months | security	35	9	1
12 Months or Greater | security	1	0	0
Fair Value
Total	$ 8,612.2	$ 1,511.0	$ 100.3
Less than 12 Months	8,598.6	1,511.0	100.3
12 Months or Greater	13.6	0.0	0.0
Unrealized Losses
Total	(111.0)	(3.7)	0.0
Less than 12 Months	(109.7)	(3.7)	0.0
12 Months or Greater	$ (1.3)	$ 0.0	$ 0.0
State and local government obligations
Number of Securities
Total | security	92	30	89
Less than 12 Months | security	92	30	78
12 Months or Greater | security	0	0	11
Fair Value
Total	$ 816.0	$ 208.7	$ 528.4
Less than 12 Months	816.0	208.7	507.7
12 Months or Greater	0.0	0.0	20.7
Unrealized Losses
Total	(16.0)	(0.7)	(4.5)
Less than 12 Months	(16.0)	(0.7)	(4.4)
12 Months or Greater	$ 0.0	$ 0.0	$ (0.1)
Corporate debt securities
Number of Securities
Total | security	79	7	233
Less than 12 Months | security	76	7	233
12 Months or Greater | security	3	0	0
Fair Value
Total	$ 1,751.4	$ 129.4	$ 4,205.6
Less than 12 Months	1,698.4	129.4	4,205.6
12 Months or Greater	53.0	0.0	0.0
Unrealized Losses
Total	(24.0)	(0.1)	(120.1)
Less than 12 Months	(23.9)	(0.1)	(120.1)
12 Months or Greater	$ (0.1)	$ 0.0	$ 0.0
Residential mortgage-backed securities
Number of Securities
Total | security	21	21	70
Less than 12 Months | security	6	0	46
12 Months or Greater | security	15	21	24
Fair Value
Total	$ 123.4	$ 44.4	$ 532.5
Less than 12 Months	94.4	0.0	425.0
12 Months or Greater	29.0	44.4	107.5
Unrealized Losses
Total	(0.8)	(0.9)	(19.2)
Less than 12 Months	(0.2)	0.0	(11.9)
12 Months or Greater	$ (0.6)	$ (0.9)	$ (7.3)
Commercial mortgage-backed securities
Number of Securities
Total | security	95	43	204
Less than 12 Months | security	77	9	187
12 Months or Greater | security	18	34	17
Fair Value
Total	$ 2,542.2	$ 893.3	$ 4,441.5
Less than 12 Months	2,023.9	93.6	4,109.2
12 Months or Greater	518.3	799.7	332.3
Unrealized Losses
Total	(45.1)	(10.0)	(188.3)
Less than 12 Months	(41.7)	(0.3)	(173.8)
12 Months or Greater	$ (3.4)	$ (9.7)	$ (14.5)
Other asset-backed securities
Number of Securities
Total | security	43	22	216
Less than 12 Months | security	36	9	201
12 Months or Greater | security	7	13	15
Fair Value
Total	$ 505.8	$ 183.7	$ 3,558.1
Less than 12 Months	477.6	74.4	3,514.2
12 Months or Greater	28.2	109.3	43.9
Unrealized Losses
Total	(0.7)	(0.5)	(40.0)
Less than 12 Months	(0.5)	(0.1)	(39.0)
12 Months or Greater	$ (0.2)	$ (0.4)	$ (1.0)
Redeemable preferred stocks
Number of Securities
Total | security	1	1	4
Less than 12 Months | security	0	0	3
12 Months or Greater | security	1	1	1
Fair Value
Total	$ 10.5	$ 11.0	$ 56.3
Less than 12 Months	0.0	0.0	45.2
12 Months or Greater	10.5	11.0	11.1
Unrealized Losses
Total	(2.0)	(1.4)	(5.1)
Less than 12 Months	0.0	0.0	(3.8)
12 Months or Greater	$ (2.0)	$ (1.4)	$ (1.3)

XML

Investments Components of Net Realized Gains (Losses) (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Gain (Loss) on Securities [Line Items]
Debt Securities, Available-for-Sale, Gross Realized Gains on Sales	$ 148.0	$ 291.6
Equity Securities, FV-NI, Gross Realized Gains on Sales	18.4	85.6
Debt and Equity Securities, Gross Realized Gains on Sales	166.4	377.2
Debt Securities, Available-for-Sale, Gross Realized Losses excluding Other-than-Temporary Impairment	(22.6)	(3.7)
Equity Securities, FV-NI, Gross Realized Losses on Sales	0.0	(58.3)
Debt and Equity Securities, Gross Realized Losses on Sales	(22.6)	(62.0)
Debt Securities, Available-for-Sale, Realized Gain (Loss) on Sales, Excluding Other-than-Temporary Impairment	125.4	287.9
Equity Securities, FV-NI, Net Realized Gain (Loss) on Sales	18.4	27.3
Gross Realized Gain (Loss), excluding Holding Period and OTTI	143.8	315.2
Unrealized Gain (Loss) on Hybrid Instrument, Net	(10.9)	(31.2)
Net holding period gains (losses), equity securities	452.4	(837.6)
Net Holding Period Realized Gain (Loss)	441.5	(868.8)
Total net realized gains (losses) on securities	585.3	(553.6)
U.S. government obligations
Gain (Loss) on Securities [Line Items]
Debt Securities, Available-for-Sale, Gross Realized Gains on Sales	66.6	251.1
Debt Securities, Available-for-Sale, Gross Realized Losses excluding Other-than-Temporary Impairment	(19.6)	(2.7)
Debt Securities, Available-for-Sale, Realized Gain (Loss) on Sales, Excluding Other-than-Temporary Impairment	47.0	248.4
State and local government obligations
Gain (Loss) on Securities [Line Items]
Debt Securities, Available-for-Sale, Gross Realized Gains on Sales	30.2	2.0
Debt Securities, Available-for-Sale, Gross Realized Losses excluding Other-than-Temporary Impairment	(0.2)	0.0
Debt Securities, Available-for-Sale, Realized Gain (Loss) on Sales, Excluding Other-than-Temporary Impairment	30.0	2.0
Corporate debt securities
Gain (Loss) on Securities [Line Items]
Debt Securities, Available-for-Sale, Gross Realized Gains on Sales	20.7	32.4
Debt Securities, Available-for-Sale, Gross Realized Losses excluding Other-than-Temporary Impairment	(2.1)	(1.0)
Debt Securities, Available-for-Sale, Realized Gain (Loss) on Sales, Excluding Other-than-Temporary Impairment	18.6	31.4
Commercial mortgage-backed securities
Gain (Loss) on Securities [Line Items]
Debt Securities, Available-for-Sale, Gross Realized Gains on Sales	29.8	6.1
Debt Securities, Available-for-Sale, Gross Realized Losses excluding Other-than-Temporary Impairment	(0.6)	0.0
Debt Securities, Available-for-Sale, Realized Gain (Loss) on Sales, Excluding Other-than-Temporary Impairment	29.2	6.1
Other asset-backed securities
Gain (Loss) on Securities [Line Items]
Debt Securities, Available-for-Sale, Gross Realized Gains on Sales	0.7	0.0
Debt Securities, Available-for-Sale, Gross Realized Losses excluding Other-than-Temporary Impairment	(0.1)	0.0
Debt Securities, Available-for-Sale, Realized Gain (Loss) on Sales, Excluding Other-than-Temporary Impairment	0.6	0.0
Nonredeemable preferred stocks
Gain (Loss) on Securities [Line Items]
Equity Securities, FV-NI, Gross Realized Gains on Sales	17.3	19.6
Equity Securities, FV-NI, Gross Realized Losses on Sales	0.0	(4.4)
Equity Securities, FV-NI, Net Realized Gain (Loss) on Sales	17.3	15.2
Common equities
Gain (Loss) on Securities [Line Items]
Equity Securities, FV-NI, Gross Realized Gains on Sales	1.1	66.0
Equity Securities, FV-NI, Gross Realized Losses on Sales	0.0	(53.9)
Equity Securities, FV-NI, Net Realized Gain (Loss) on Sales	$ 1.1	$ 12.1

XML

Investments Components of Equity Realized Gains (Losses) (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Investments, Debt and Equity Securities [Abstract]
Realized Investment Gains (Losses)	$ 470.8	$ (810.3)
Equity Securities, FV-NI, Net Realized Gain (Loss) on Sales	18.4	27.3
Equity Securities, FV-NI, Unrealized Gain (Loss)	$ 452.4	$ (837.6)

XML

Investments Components of Net Investment Income (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Net Investment Income [Line Items]
Gross investment income	$ 220.2	$ 241.2
Investment expenses	(5.6)	(5.3)
Net Investment Income	214.6	235.9
Available-for-sale Securities
Net Investment Income [Line Items]
Gross investment income	188.1	212.8
Total equity securities
Net Investment Income [Line Items]
Gross investment income	32.1	28.4
Total equity securities | Nonredeemable preferred stocks
Net Investment Income [Line Items]
Gross investment income	17.9	13.8
Total equity securities | Common equities
Net Investment Income [Line Items]
Gross investment income	14.2	14.6
Total fixed maturities
Net Investment Income [Line Items]
Gross investment income	186.6	205.8
Total fixed maturities | U.S. government obligations
Net Investment Income [Line Items]
Gross investment income	30.4	62.6
Total fixed maturities | State and local government obligations
Net Investment Income [Line Items]
Gross investment income	13.4	9.6
Total fixed maturities | Corporate debt securities
Net Investment Income [Line Items]
Gross investment income	85.2	58.0
Total fixed maturities | Residential mortgage-backed securities
Net Investment Income [Line Items]
Gross investment income	3.4	4.2
Total fixed maturities | Commercial mortgage-backed securities
Net Investment Income [Line Items]
Gross investment income	35.8	34.3
Total fixed maturities | Other asset-backed securities
Net Investment Income [Line Items]
Gross investment income	15.9	29.2
Total fixed maturities | Redeemable preferred stocks
Net Investment Income [Line Items]
Gross investment income	2.5	7.9
Short-term investments
Net Investment Income [Line Items]
Gross investment income	$ 1.5	$ 7.0

XML

Investments - Additional Information (Detail)	1 Months Ended	3 Months Ended
	Mar. 31, 2020 USD ($)	Mar. 31, 2021 USD ($) security	Dec. 31, 2020 USD ($)
Schedule of Debt and Equity Securities [Line Items]
Principal amount of bonds and certificates of deposit		$ 296,100,000
Securities Exceeding 10% of Shareholders' Equity	$ 0	0	$ 0
Non-Income Producing Securities		0
Open reverse repurchase commitments	0	0	0
Securities Sold under Agreements to Repurchase	0	$ 0	0
Debt Securities, Available-for-sale, Unrealized Loss Position, Positions Downgraded | security		3
Combined fair value of securities		$ 31,900,000
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss, Downgrades in Period		700,000
Debt Securities, Available-for-sale, Allowance for Credit Loss, Not Previously Recorded		0
Debt Securities, Available-for-sale, Allowance for Credit Loss	0	0	$ 0
Debt Securities, Available-for-sale, Allowance for Credit Loss, Writeoff		$ 0
Percent Change in Investment Income		9.00%
Percent Change in Book Yield		22.00%
Proceeds from Debt, Net of Issuance Costs	$ 1,000,000,000.0

XML

Fair Value Composition of Investment Portfolio by Major Security Type (Detail) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	$ 47,400.6	$ 47,530.3	$ 40,342.3
Fair Value	6,195.2	6,793.5	6,108.6
Available-for-sale Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	41,334.9	42,029.4	36,800.8
Available-for-sale Securities | Total fixed maturities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	39,091.8	36,810.9	34,276.6
Available-for-sale Securities | Total fixed maturities | Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	29,133.7	26,147.0	23,291.8
Available-for-sale Securities | Total fixed maturities | Debt Securities | U.S. government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	16,073.4	12,740.0	11,495.7
Available-for-sale Securities | Total fixed maturities | Debt Securities | State and local government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,624.1	3,221.8	2,304.2
Available-for-sale Securities | Total fixed maturities | Debt Securities | Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	10,436.2	10,185.2	9,491.9
Available-for-sale Securities | Total fixed maturities | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	9,768.6	10,469.2	10,860.0
Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	553.2	509.5	556.6
Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	5,892.0	6,175.1	5,664.3
Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Other asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	3,323.4	3,784.6	4,639.1
Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	189.5	194.7	124.8
Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	50.6	51.6	47.2
Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	11.4	11.7	9.2
Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	127.5	131.4	68.4
Available-for-sale Securities | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,243.1	5,218.5	2,524.2
Total equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	6,065.7	5,500.9	3,541.5
Total equity securities | Nonredeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,507.2	1,447.9	933.4
Total equity securities | Nonredeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,423.5	1,365.0	870.9
Total equity securities | Nonredeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	41.9	41.9	32.0
Total equity securities | Nonredeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	41.8	41.0	30.5
Total equity securities | Common equities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	4,558.5	4,053.0	2,608.1
Total equity securities | Common equities | Common Stocks, excluding Other Risk
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	4,555.3	4,049.9	2,607.8
Total equity securities | Common equities | Other risk investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	3.2	3.1	0.3
Fair Value, Inputs, Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	22,980.9	21,623.3	16,654.7
Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	18,311.8	17,455.7	13,941.4
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	16,084.0	12,750.8	11,503.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	16,073.4	12,740.0	11,495.7
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Debt Securities | U.S. government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	16,073.4	12,740.0	11,495.7
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Debt Securities | State and local government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Debt Securities | Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Other asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	10.6	10.8	7.3
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	10.6	10.8	7.3
Fair Value, Inputs, Level 1 | Available-for-sale Securities | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,227.8	4,704.9	2,438.4
Fair Value, Inputs, Level 1 | Total equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	4,669.1	4,167.6	2,713.3
Fair Value, Inputs, Level 1 | Total equity securities | Nonredeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	113.8	117.7	105.5
Fair Value, Inputs, Level 1 | Total equity securities | Nonredeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	113.8	117.7	105.5
Fair Value, Inputs, Level 1 | Total equity securities | Nonredeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Total equity securities | Nonredeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 1 | Total equity securities | Common equities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	4,555.3	4,049.9	2,607.8
Fair Value, Inputs, Level 1 | Total equity securities | Common equities | Common Stocks, excluding Other Risk
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	4,555.3	4,049.9	2,607.8
Fair Value, Inputs, Level 1 | Total equity securities | Common equities | Other risk investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	24,364.9	25,852.2	23,659.0
Fair Value	6,195.2	6,793.5	6,108.6
Fair Value, Inputs, Level 2 | Available-for-sale Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	23,023.1	24,573.7	22,859.4
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	23,007.8	24,060.1	22,773.6
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	13,060.3	13,407.0	11,796.1
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Debt Securities | U.S. government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Debt Securities | State and local government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,624.1	3,221.8	2,304.2
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Debt Securities | Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	10,436.2	10,185.2	9,491.9
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	9,768.6	10,469.2	10,860.0
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	553.2	509.5	556.6
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	5,892.0	6,175.1	5,664.3
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Other asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	3,323.4	3,784.6	4,639.1
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	178.9	183.9	117.5
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	50.6	51.6	47.2
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	11.4	11.7	9.2
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	116.9	120.6	61.1
Fair Value, Inputs, Level 2 | Available-for-sale Securities | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	15.3	513.6	85.8
Fair Value, Inputs, Level 2 | Total equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,341.8	1,278.5	799.6
Fair Value, Inputs, Level 2 | Total equity securities | Nonredeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,341.8	1,278.5	799.6
Fair Value, Inputs, Level 2 | Total equity securities | Nonredeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,274.7	1,212.3	752.3
Fair Value, Inputs, Level 2 | Total equity securities | Nonredeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	41.9	41.9	32.0
Fair Value, Inputs, Level 2 | Total equity securities | Nonredeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	25.2	24.3	15.3
Fair Value, Inputs, Level 2 | Total equity securities | Common equities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 2 | Total equity securities | Common equities | Common Stocks, excluding Other Risk
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 2 | Total equity securities | Common equities | Other risk investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	54.8	54.8	28.6
Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Debt Securities | U.S. government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Debt Securities | State and local government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Debt Securities | Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Other asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Available-for-sale Securities | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Total equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	54.8	54.8	28.6
Fair Value, Inputs, Level 3 | Total equity securities | Nonredeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	51.6	51.7	28.3
Fair Value, Inputs, Level 3 | Total equity securities | Nonredeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	35.0	35.0	13.1
Fair Value, Inputs, Level 3 | Total equity securities | Nonredeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Total equity securities | Nonredeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	16.6	16.7	15.2
Fair Value, Inputs, Level 3 | Total equity securities | Common equities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	3.2	3.1	0.3
Fair Value, Inputs, Level 3 | Total equity securities | Common equities | Common Stocks, excluding Other Risk
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	0.0	0.0	0.0
Fair Value, Inputs, Level 3 | Total equity securities | Common equities | Other risk investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	3.2	3.1	0.3
Carrying (Reported) Amount, Fair Value Disclosure
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	43,465.5	43,353.6	38,416.0
Long-term Debt	5,396.8	5,396.1	5,394.0
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	40,807.1	40,807.6	36,285.3
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	38,564.0	35,589.1	33,761.1
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Debt Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	28,672.7	25,117.0	22,538.0
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Debt Securities | U.S. government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	16,002.7	12,437.9	10,841.2
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Debt Securities | State and local government obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,574.8	3,099.4	2,243.9
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Debt Securities | Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	10,095.2	9,579.7	9,452.9
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	9,710.1	10,290.9	11,071.6
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Residential mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	548.3	503.3	574.3
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Commercial mortgage-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	5,868.3	6,042.6	5,822.4
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Asset-backed Securities | Other asset-backed securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	3,293.5	3,745.0	4,674.9
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	181.2	181.2	151.5
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	51.0	51.1	51.4
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	10.0	10.0	10.0
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Total fixed maturities | Redeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	120.2	120.1	90.1
Carrying (Reported) Amount, Fair Value Disclosure | Available-for-sale Securities | Short-term investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,243.1	5,218.5	2,524.2
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	2,658.4	2,546.0	2,130.7
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Nonredeemable preferred stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,453.9	1,358.7	1,017.5
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Nonredeemable preferred stocks | Financials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,373.9	1,278.6	937.4
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Nonredeemable preferred stocks | Utilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	39.9	40.0	40.0
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Nonredeemable preferred stocks | Industrials
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	40.1	40.1	40.1
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Common equities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,204.5	1,187.3	1,113.2
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Common equities | Common Stocks, excluding Other Risk
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	1,201.3	1,184.2	1,112.9
Carrying (Reported) Amount, Fair Value Disclosure | Total equity securities | Common equities | Other risk investments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Investments, Fair Value	$ 3.2	$ 3.1	$ 0.3

XML

Fair Value Summary of Changes in Fair Value Associated with Level 3 Assets (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value, beginning balance	$ 54.8	$ 43.4
Calls/ Maturities/ Paydowns	0.0	0.0
Purchases	0.1	0.0
Sales	0.0	0.0
Net Realized (Gain)/Loss on Sales	0.0	0.0
Change in Valuation	(0.1)	(14.8)
Net Transfers In (Out)	0.0	0.0
Fair value, ending balance	54.8	28.6
Total equity securities | Financials | Nonredeemable preferred stocks
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value, beginning balance	35.0	27.1
Calls/ Maturities/ Paydowns	0.0	0.0
Purchases	0.0	0.0
Sales	0.0	0.0
Net Realized (Gain)/Loss on Sales	0.0	0.0
Change in Valuation	0.0	(14.0)
Net Transfers In (Out)	0.0	0.0
Fair value, ending balance	35.0	13.1
Total equity securities | Industrials | Nonredeemable preferred stocks
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value, beginning balance	16.7	16.0
Calls/ Maturities/ Paydowns	0.0	0.0
Purchases	0.0	0.0
Sales	0.0	0.0
Net Realized (Gain)/Loss on Sales	0.0	0.0
Change in Valuation	(0.1)	(0.8)
Net Transfers In (Out)	0.0	0.0
Fair value, ending balance	16.6	15.2
Total equity securities | Other risk investments | Common equities
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Fair value, beginning balance	3.1	0.3
Calls/ Maturities/ Paydowns	0.0	0.0
Purchases	0.1	0.0
Sales	0.0	0.0
Net Realized (Gain)/Loss on Sales	0.0	0.0
Change in Valuation	0.0	0.0
Net Transfers In (Out)	0.0	0.0
Fair value, ending balance	$ 3.2	$ 0.3

XML

Fair Value Summary of Quantitative Information about Level 3 Fair Value Measurements (Details) - USD ($) $ / shares in Units, $ in Millions	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 47,400.6	$ 40,342.3	$ 47,530.3
Fair Value, Inputs, Level 3
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	54.8	28.6	54.8
Fair Value, Inputs, Level 3 | Internal Pricing | Nonredeemable preferred stocks | Financials
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 25.0	$ 13.1	$ 25.0
Fair Value Inputs, Original Issue Price	$ 3.7		$ 3.7
Fair Value Inputs, Guideline Public Company Method		$ 4.4
Fair Value, Inputs, Level 3 | Internal Pricing | Nonredeemable preferred stocks | Industrials
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value		$ 7.1
Fair Value Inputs, Guideline Public Company Method		$ 5.6
Fair Value, Inputs, Level 3 | Unadjusted Purchase Price | Nonredeemable preferred stocks | Financials
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 10.0		$ 10.0
Fair Value Inputs, Original Issue Price	$ 16.9		$ 16.9
Fair Value, Inputs, Level 3 | Third Party Pricing Firm | Nonredeemable preferred stocks | Industrials
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 6.9		$ 6.9
Fair Value Inputs, Guideline Public Company Method	$ 5.4		$ 5.4
Fair Value, Inputs, Level 3 | Guideline Public Company Method [Member] | Nonredeemable preferred stocks | Industrials
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 9.7	$ 8.1	$ 9.8
Fair Value Inputs, Guideline Public Company Method	$ 4.8	$ 4.0	$ 4.8
Fair Value, Inputs, Level 3 | Total Quantitative Level Three Securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 51.6	$ 28.3	$ 51.7
Fair Value, Inputs, Level 3 | Third Party Pricing Exemption Securities
Fair Value Measurement Inputs and Valuation Techniques [Line Items]
Investments, Fair Value	$ 3.2	$ 0.3	$ 3.1

XML

Fair Value - Additional Information (Detail)	Mar. 31, 2021 USD ($) security	Dec. 31, 2020 USD ($) security	Mar. 31, 2020 USD ($) security
Fair Value Measurements [Line Items]
Investments, Fair Value	$ 47,400,600,000	$ 47,530,300,000	$ 40,342,300,000
Fair Value, Inputs, Level 1
Fair Value Measurements [Line Items]
Vendor Quoted Prices, Percent of FV Hierarchy Level	78.00%	76.00%	82.00%
Investments, Fair Value	$ 22,980,900,000	$ 21,623,300,000	$ 16,654,700,000
Fair Value, Inputs, Level 2
Fair Value Measurements [Line Items]
Vendor Quoted Prices, Percent of FV Hierarchy Level	99.00%	99.00%	98.00%
Dealer Quoted Prices, Percent of FV Hierarchy Level	1.00%	1.00%	2.00%
Investments, Fair Value	$ 24,364,900,000	$ 25,852,200,000	$ 23,659,000,000.0
Fair Value, Inputs, Level 3
Fair Value Measurements [Line Items]
Investments, Fair Value	54,800,000	54,800,000	28,600,000
Total fixed maturities | Fair Value, Inputs, Level 3
Fair Value Measurements [Line Items]
Investments, Fair Value	$ 0	$ 0	$ 0
Nonredeemable preferred stocks | Fair Value, Inputs, Level 3
Fair Value Measurements [Line Items]
Number of securities | security	4	4	3
Common equities | Fair Value, Inputs, Level 3
Fair Value Measurements [Line Items]
Number of securities | security	2	2	1

XML

Debt (Detail) - USD ($)		Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Debt Instrument [Line Items]
Fair Value		$ 6,195,200,000	$ 6,793,500,000	$ 6,108,600,000
Debt, Long-term and Short-term, Combined Amount	[1]	5,396,800,000	5,396,100,000	5,394,000,000.0
3.75% Senior Notes due 2021 (issued: $500.0, August 2011)
Debt Instrument [Line Items]
Long-term Debt		499,900,000	499,800,000	499,500,000
Fair Value		$ 506,700,000	510,900,000	510,700,000
Debt, stated interest rate		3.75%
Debt, face amount		$ 500,000,000.0	500,000,000.0	500,000,000.0
2.45% Senior Notes due 2027 (issued: $500.0, August 2016)
Debt Instrument [Line Items]
Long-term Debt		497,400,000	497,300,000	497,000,000.0
Fair Value		$ 526,800,000	541,100,000	488,200,000
Debt, stated interest rate		2.45%
Debt, face amount		$ 500,000,000.0	500,000,000.0	500,000,000.0
6 5/8% Senior Notes due 2029 (issued: $300.0, March 1999)
Debt Instrument [Line Items]
Long-term Debt		297,000,000.0	296,900,000	296,700,000
Fair Value		$ 386,100,000	409,400,000	395,300,000
Debt, stated interest rate		6.625%
Debt, face amount		$ 300,000,000.0	300,000,000.0	300,000,000.0
4.00% Senior Notes due 2029 (issued: $550.0, October 2018)
Debt Instrument [Line Items]
Long-term Debt		545,600,000	545,500,000	545,100,000
Fair Value		$ 623,700,000	660,400,000	605,700,000
Debt, stated interest rate		4.00%
Debt, face amount		$ 550,000,000.0	550,000,000.0	550,000,000.0
Senior Notes Three Point Two Zero Percent Due Twenty Thirty [Member]
Debt Instrument [Line Items]
Long-term Debt		496,200,000	496,100,000	495,800,000
Fair Value		$ 536,700,000	575,500,000	543,200,000
Debt, stated interest rate		3.20%
Debt, face amount		$ 500,000,000.0	500,000,000.0	500,000,000.0
6.25% Senior Notes due 2032 (issued: $400.0, November 2002)
Debt Instrument [Line Items]
Long-term Debt		396,000,000.0	396,000,000.0	395,800,000
Fair Value		$ 531,400,000	582,000,000.0	539,600,000
Debt, stated interest rate		6.25%
Debt, face amount		$ 400,000,000.0	400,000,000.0	400,000,000.0
4.35% Senior Notes due 2044 (issued: $350.0, April 2014)
Debt Instrument [Line Items]
Long-term Debt		346,800,000	346,700,000	346,700,000
Fair Value		$ 413,900,000	459,700,000	391,700,000
Debt, stated interest rate		4.35%
Debt, face amount		$ 350,000,000.0	350,000,000.0	350,000,000.0
3.70% Senior Notes due 2045 (issued: $400.0, January 2015)
Debt Instrument [Line Items]
Long-term Debt		395,600,000	395,500,000	395,400,000
Fair Value		$ 430,200,000	481,000,000.0	406,200,000
Debt, stated interest rate		3.70%
Debt, face amount		$ 400,000,000.0	400,000,000.0	400,000,000.0
4.125% Senior Notes due 2047 (issued: $850.0, April 2017)
Debt Instrument [Line Items]
Long-term Debt		841,700,000	841,700,000	841,600,000
Fair Value		$ 977,100,000	1,113,100,000	991,900,000
Debt, stated interest rate		4.125%
Debt, face amount		$ 850,000,000.0	850,000,000.0	850,000,000.0
4.20% Senior Notes due 2048 (issued: $600.0, March 2018)
Debt Instrument [Line Items]
Long-term Debt		590,000,000.0	590,000,000.0	589,900,000
Fair Value		$ 698,700,000	806,700,000	675,800,000
Debt, stated interest rate		4.20%
Debt, face amount		$ 600,000,000.0	600,000,000.0	600,000,000.0
Senior Notes Three Point Nine Five Percent Due Twenty Fifty [Member]
Debt Instrument [Line Items]
Long-term Debt		490,600,000	490,600,000	490,500,000
Fair Value		$ 563,900,000	653,700,000	560,300,000
Debt, stated interest rate		3.95%
Debt, face amount		$ 500,000,000.0	$ 500,000,000.0	$ 500,000,000.0

[1] Consists of both short-term and long-term debt. See Note 4 – Debt for further discussion.

XML

Debt - Additional Information (Detail) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Debt Instrument [Line Items]
Long-Term Debt, Maturity, Remainder of Fiscal Year		$ 0
3.75% Senior Notes due 2021 (issued: $500.0, August 2011)
Debt Instrument [Line Items]
Debt, stated interest rate	3.75%
Debt, face amount	$ 500,000,000.0	500,000,000.0	$ 500,000,000.0
Long-Term Debt, Maturity, Remainder of Fiscal Year	500,000,000		500,000,000
Discretionary Line of Credit
Debt Instrument [Line Items]
Maximum borrowing capacity	250,000,000
Borrowings outstanding	$ 0	$ 0	$ 0

XML

Income Taxes Additional Information (Details) - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Income Taxes [Line Items]
Valuation allowance	$ 0	$ 0	$ 0
Effective Income Tax Rate Reconciliation, Percent	20.80%	20.10%

XML

Loss and Loss Adjustment Expense Reserves (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020	Dec. 31, 2019
Liability for Claims and Claims Adjustment Expense [Line Items]
Loss and loss adjustment expense reserves	$ 21,063.7	$ 18,306.5	$ 20,265.8	$ 18,105.4
Reinsurance Recoverable for Unpaid Claims and Claims Adjustments and Liability for Unpaid Claims and Claim Adjustment Expense, Other Reconciling Item	3,968.6	3,443.7	3,798.2	3,212.2
Liability for Unpaid Claims and Claims Adjustment Expense, Net	17,095.1	14,862.8	$ 16,467.6	$ 14,893.2
Current Year Claims and Claims Adjustment Expense	6,986.1	6,011.1
Prior Year Claims and Claims Adjustment Expense	124.4	144.1
Liability for Unpaid Claims and Claims Adjustment Expense, Incurred Claims	7,110.5	6,155.2
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid, Current Year	3,029.3	2,916.4
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid, Prior Years	3,453.7	3,269.2
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid	$ 6,483.0	$ 6,185.6
Short-Duration Insurance Contract, Accident Year 2020
Liability for Claims and Claims Adjustment Expense [Line Items]
Percent of Prior Year Claims and Claims Adjustment Expense	34.00%
Short-Duration Insurance Contract, Accident Year 2019
Liability for Claims and Claims Adjustment Expense [Line Items]
Percent of Prior Year Claims and Claims Adjustment Expense	34.00%	52.00%
Short-duration Insurance Contracts, Accident Year 2018
Liability for Claims and Claims Adjustment Expense [Line Items]
Percent of Prior Year Claims and Claims Adjustment Expense		36.00%
Personal Lines | Personal auto businesses
Liability for Claims and Claims Adjustment Expense [Line Items]
Prior Year Claims and Claims Adjustment Expense	$ 92.0	$ 104.0
Personal Lines | Special Lines
Liability for Claims and Claims Adjustment Expense [Line Items]
Prior Year Claims and Claims Adjustment Expense	(5.0)	(14.0)
Commercial Lines
Liability for Claims and Claims Adjustment Expense [Line Items]
Prior Year Claims and Claims Adjustment Expense	29.0	$ 54.0
Property
Liability for Claims and Claims Adjustment Expense [Line Items]
Prior Year Claims and Claims Adjustment Expense	$ 8.0
Agency | Personal Lines | Personal auto businesses
Liability for Claims and Claims Adjustment Expense [Line Items]
Percent of Prior Year Claims and Claims Adjustment Expense	60.00%

XML

Supplemental Cash Flow Information (Detail) - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020	Dec. 31, 2019
Open reverse repurchase commitments	$ 0	$ 0	$ 0
Dividends Payable	58,500,000	58,500,000	2,694,500,000
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability	6,200,000	9,700,000
Operating Lease, Payments	24,500,000	22,700,000
Income Taxes Paid	800,000	0
Interest Paid, Including Capitalized Interest, Operating and Investing Activities	74,300,000	56,400,000
Cash and Cash Equivalents | ARX Holding Corp.
Open reverse repurchase commitments	154,000,000.0	80,600,000	93,500,000
Common equities | Quarterly dividend [Member]
Dividends Payable	$ 58,500,000	$ 58,500,000	$ 58,600,000	$ 58,500,000

XML

Segment Information Operating Results (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Segment Reporting Information [Line Items]
Revenues	$ 11,445.2	$ 9,323.4
Pretax Profit (Loss)	1,867.9	874.7
Amortization of intangible assets	14.2	14.5
Personal Lines | Agency | Underwriting operations
Segment Reporting Information [Line Items]
Revenues	4,098.2	3,828.7
Pretax Profit (Loss)	547.5	601.6
Personal Lines | Direct | Underwriting operations
Segment Reporting Information [Line Items]
Revenues	4,431.7	3,992.4
Pretax Profit (Loss)	414.6	473.0
Operating Segments | Underwriting operations
Segment Reporting Information [Line Items]
Revenues	10,420.2	9,430.7
Pretax Profit (Loss)	1,119.9	1,236.3
Operating Segments | Personal Lines | Underwriting operations
Segment Reporting Information [Line Items]
Revenues	8,529.9	7,821.1
Pretax Profit (Loss)	$ 962.1	$ 1,074.6
Personal auto insurance percentage of the total personal lines segment net premiums earned	94.00%	94.00%
Operating Segments | Commercial Lines | Underwriting operations
Segment Reporting Information [Line Items]
Revenues	$ 1,417.8	$ 1,189.0
Pretax Profit (Loss)	228.5	112.5
Operating Segments | Property | Underwriting operations
Segment Reporting Information [Line Items]
Revenues	472.5	420.6
Pretax Profit (Loss)	(70.7)	49.2
Amortization of intangible assets	14.2	14.5
Segment Reconciling Items | Fees and other revenues
Segment Reporting Information [Line Items]
Revenues	165.7	153.5
Segment Reconciling Items | Service businesses
Segment Reporting Information [Line Items]
Revenues	53.8	51.6
Pretax Profit (Loss)	4.5	4.1
Segment Reconciling Items | Investment income
Segment Reporting Information [Line Items]
Revenues	805.5	(312.4)
Pretax Profit (Loss)	799.9	(317.7)
Segment Reconciling Items | Interest expense
Segment Reporting Information [Line Items]
Pretax Profit (Loss)	$ (56.4)	$ (48.0)

XML

Segment Information Underwriting Margins and Combined Ratios for our Underwriting Operations (Detail) - Underwriting operations	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Personal Lines | Agency
Segment Reporting Information [Line Items]
Underwriting Margin	13.40%	15.70%
Combined Ratio	86.60%	84.30%
Personal Lines | Direct
Segment Reporting Information [Line Items]
Underwriting Margin	9.40%	11.90%
Combined Ratio	90.60%	88.10%
Operating Segments
Segment Reporting Information [Line Items]
Underwriting Margin	10.70%	13.10%
Combined Ratio	89.30%	86.90%
Operating Segments | Personal Lines
Segment Reporting Information [Line Items]
Underwriting Margin	11.30%	13.70%
Combined Ratio	88.70%	86.30%
Operating Segments | Commercial Lines
Segment Reporting Information [Line Items]
Underwriting Margin	16.10%	9.50%
Combined Ratio	83.90%	90.50%
Operating Segments | Property
Segment Reporting Information [Line Items]
Underwriting Margin	(15.00%)	11.70%
Combined Ratio	115.00%	88.30%
Combined ratio amortization points	0.030	0.034

XML

Dividends (Details) - USD ($) $ / shares in Units, $ in Millions	1 Months Ended					3 Months Ended
	Mar. 31, 2021	Jan. 31, 2021	Apr. 30, 2020	Mar. 31, 2020	Jan. 31, 2020	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020	Feb. 29, 2020	Dec. 31, 2019
Common Stock, Dividends, Per Share, Declared						$ 0.10	$ 0.10
Dividends Payable	$ 58.5			$ 58.5		$ 58.5	$ 58.5	$ 2,694.5
Quarterly dividend [Member]
Common Stock, Dividends, Per Share, Declared	$ 0.10
Common Stock, Dividends, Per Share, Cash Paid		$ 0.10	$ 0.10		$ 0.10
Annual variable dividend
Common Stock, Dividends, Per Share, Cash Paid		$ 4.50			$ 2.25
Series B Preferred Stock
Preferred Stock, Dividends, Per Share, Cash Paid	$ 26.875			$ 26.875
Dividends Payable								13.4	$ 13.4
Common equities | Quarterly dividend [Member]
Dividends Payable	$ 58.5			$ 58.5		$ 58.5	$ 58.5	58.6		$ 58.5
Common equities | Annual variable dividend
Dividends Payable								$ 2,635.9		$ 1,316.9

XML

Other Comprehensive Income (Loss) Components of Other Comprehensive Income (Loss) Including Reclassification Adjustments by Income Statement (Detail) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Accumulated Other Comprehensive Income (Loss), before Tax [Roll Forward]
AOCI before Tax, Attributable to Parent, beginning balance	$ 1,187.4	$ 435.7
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment and Tax	(551.4)	318.2
Other Comprehensive Income (Loss), before Tax, Portion Attributable to Noncontrolling Interest	0.0	(0.6)
OCI, before Reclassifications, before Tax, Attributable to Parent	(551.4)	317.6
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax	131.7	238.7
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax	(0.3)	(0.3)
Total reclassification adjustment for amounts realized in net income, pre tax	131.4	238.4
Other Comprehensive Income (Loss), before Tax, Portion Attributable to Parent	(682.8)	79.2
AOCI before Tax, Attributable to Parent, ending balance	504.6	514.9
Accumulated Other Comprehensive Income (Loss), Tax [Roll Forward]
AOCI Tax, Attributable to Parent, beginning balance	(255.7)	(94.0)
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, Tax	115.8	(66.8)
Other Comprehensive Income (Loss), Tax, Portion Attributable to Noncontrolling Interest	0.0	0.1
OCI, Debt Securities, Available-for-Sale, Gain (Loss), before Adjustment, Tax	115.8	(66.7)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax	(27.7)	(50.1)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Tax	0.1	0.1
Total reclassification adjustment for amounts realized in net income, Total tax (provision) benefit	(27.6)	(50.0)
Other Comprehensive Income (Loss), Tax, Portion Attributable to Parent	143.4	(16.7)
AOCI Tax, Attributable to Parent, ending balance	(112.3)	(110.7)
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
After tax total accumulated other comprehensive income, beginning balance	931.7	341.7
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax	(435.6)	251.4
Other comprehensive income attributable to NCI	0.0	(0.5)
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax	(435.6)	250.9
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	104.0	188.6
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax	(0.2)	(0.2)
Total reclassification adjustment for amounts realized in net income, after tax	103.8	188.4
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	(539.4)	62.5
After tax total accumulated other comprehensive income, ending balance	392.3	404.2
Total net unrealized gains (losses) on securities
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
After tax total accumulated other comprehensive income, beginning balance	947.3	360.8
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax	(435.6)	251.4
Other comprehensive income attributable to NCI	0.0	0.0
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax	(435.6)	251.4
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	104.0	188.6
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax	0.0	0.0
Total reclassification adjustment for amounts realized in net income, after tax	104.0	188.6
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	(539.6)	62.8
After tax total accumulated other comprehensive income, ending balance	407.7	423.6
Net unrealized gains (losses) on forecasted transactions
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
After tax total accumulated other comprehensive income, beginning balance	(15.6)	(16.4)
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax	0.0	0.0
Other comprehensive income attributable to NCI	0.0	0.0
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax	0.0	0.0
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	0.0	0.0
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax	(0.2)	(0.2)
Total reclassification adjustment for amounts realized in net income, after tax	(0.2)	(0.2)
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	0.2	0.2
After tax total accumulated other comprehensive income, ending balance	(15.4)	(16.2)
(Income) loss attributable to NCI
Accumulated Other Comprehensive Income (Loss), Net of Tax [Roll Forward]
After tax total accumulated other comprehensive income, beginning balance	0.0	(2.7)
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax	0.0	0.0
Other comprehensive income attributable to NCI	0.0	(0.5)
Other Comprehensive Income (Loss), before Reclassifications, Net of Tax	0.0	(0.5)
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax	0.0	0.0
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, Net of Tax	0.0	0.0
Total reclassification adjustment for amounts realized in net income, after tax	0.0	0.0
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent	0.0	(0.5)
After tax total accumulated other comprehensive income, ending balance	$ 0.0	$ (3.2)

XML

Other Comprehensive Income (Loss) Components of Other Comprehensive Income (Loss) Including Reclassification Adjustments by Income Statement, Additional Information (Detail) $ in Millions	Mar. 31, 2021 USD ($)
Statement of Comprehensive Income [Abstract]
Net unrealized losses on forecasted transactions, expected to reclassify into income within the next 12 months	$ 0.7

XML

Goodwill and Intangible Assets Goodwill (Details) - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill, Acquired During Period	$ 0
Goodwill, Impaired, Accumulated Impairment Loss	0
Amortization of intangible assets	$ 14,200,000	$ 14,500,000

XML

Goodwill and Intangible Assets - Net Carrying Amount of Other Intangible Assets (Details) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Schedule of Other Intangible Assets [Line Items]
Indefinite lived intangible assets	$ 12.4	$ 12.4	$ 12.4
Total	157.2	171.4	213.8
Accumulated amortization	340.3	326.1	328.5
Licensing Agreements
Schedule of Other Intangible Assets [Line Items]
Accumulated amortization	0.6	0.6	0.6
Finite-Lived Intangible Assets
Schedule of Other Intangible Assets [Line Items]
Intangible assets subject to amortization	144.8	159.0	201.4
Accumulated amortization	$ 339.7	$ 325.5	$ 327.9

XML

Goodwill and Intangible Assets - Finite-lived Intangible Assets (Details) - USD ($) $ in Millions	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Finite-Lived Intangible Assets [Line Items]
Accumulated Amortization	$ 340.3	$ 326.1	$ 328.5
Policies in force
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	256.2	256.2	256.2
Accumulated Amortization	219.6	210.4	183.0
Net Carrying Amount	36.6	45.8	73.2
Agency relationships
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	159.2	159.2	159.2
Accumulated Amortization	68.3	65.4	56.9
Net Carrying Amount	90.9	93.8	102.3
Software rights
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	69.1	69.1	79.1
Accumulated Amortization	51.8	49.7	53.2
Net Carrying Amount	17.3	19.4	25.9
Trade name
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	0.0	0.0	34.8
Accumulated Amortization	0.0	0.0	34.8
Net Carrying Amount	0.0	0.0	0.0
Finite-Lived Intangible Assets
Finite-Lived Intangible Assets [Line Items]
Gross Carrying Amount	484.5	484.5	529.3
Accumulated Amortization	339.7	325.5	327.9
Net Carrying Amount	$ 144.8	$ 159.0	$ 201.4