Progressive’s Profit Beats Expectations on Strong Demand for Insurance Policies

Insurer Progressive Corp reported a better-than expected first-quarter profit on Friday, helped by strong demand for its personal and property insurance policies, sending its shares up 2% in early trading.

Source: Reuters | Published on April 12, 2024

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Insurer Progressive Corp reported a better-than expected first-quarter profit on Friday, helped by strong demand for its personal and property insurance policies, sending its shares up 2% in early trading.

Strong job market and rising wages are fueling renewed spending on auto insurance, one of Progressive’s core business.

It had 26.5 million personal insurance policies in force, 7% higher than last year. Property business and commercial lines policies were also 10% and 3% higher than last year, respectively.

Excluding one-off items, the Mayfield Village, Ohio-based company earned $3.75 a share, trouncing analysts’ average estimates of $3.24 a share, according to LSEG data.

Shares of Progressive have advanced 30% so far this year, outperforming peers like Allstate and Travelers which rose 20% and 17%, respectively.

Progressive earned $16.15 billion in net premiums, 19% higher than last year.

Combined ratio was 86.1%, versus 99% last year. A ratio below 100% means the insurer earned more in premiums than it paid out in claims