8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

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

Date of Report (Date of earliest event reported) June 10, 2009 (June 9, 2009)

THE PROGRESSIVE CORPORATION

(Exact name of registrant as specified in its charter)

Ohio	1-9518	34-0963169
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

6300 Wilson Mills Road, Mayfield Village, Ohio 44143

(Address of principal executive offices)                     (Zip Code)

Registrant’s telephone number, including area code 440-461-5000

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01 Regulation FD Disclosure.

On June 9, 2009, The Progressive Corporation issued a news release containing financial results for the Company and its consolidated subsidiaries for the month of, and year-to-date period ended, May 2009. A copy of the news release is attached hereto as Exhibit 99.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

See exhibit index on page 4.

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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 hereunto duly authorized.

Date: June 10, 2009

THE PROGRESSIVE CORPORATION
By:	/s/ Jeffrey W. Basch
Name:	Jeffrey W. Basch
Title:	Vice President and Chief Accounting Officer

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EXHIBIT INDEX

Exhibit No. Under Reg. S-K Item 601	Form 8-K Exhibit No.	Description
(99)	99	News release dated June 9, 2009, containing financial results of The Progressive Corporation and its consolidated subsidiaries for the month of, and year-to-date period ended, May 2009.

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EX-99

Exhibit 99

	NEWS RELEASE
The Progressive Corporation	Company Contact:
6300 Wilson Mills Road	Patrick Brennan
Mayfield Village, Ohio 44143	(440) 395-2370
http://www.progressive.com

PROGRESSIVE REPORTS MAY RESULTS

MAYFIELD VILLAGE, OHIO — June 9, 2009 — The Progressive Corporation today reported the following results for May 2009:

(millions, except per share amounts and ratios)	May 2009			May 2008			Change
Net premiums written	$	1,054.9		$	1,049.2		1	%
Net premiums earned	$	1,058.2		$	1,050.1		1	%
Net income	$	54.6		$	79.3		(31	)%
Per share	$	.08		$	.12		(31	)%
Pretax net realized gains (losses) on securities	$	(.4	)	$	(7.9	)	(95	)%
Combined ratio		95.3			92.4		2.9 pts.
Average diluted equivalent shares		674.9			673.6		0	%
(in thousands)	May 2009			May 2008			Change
Policies in Force:
Agency – Auto		4,343.2			4,424.4		(2	)%
Direct – Auto		3,014.0			2,702.8		12	%
Total Personal Auto		7,357.2			7,127.2		3	%
Total Special Lines		3,441.2			3,266.0		5	%
Total Personal Lines		10,798.4			10,393.2		4	%
Total Commercial Auto		531.4			555.1		(4	)%

Progressive offers insurance to personal and commercial auto drivers throughout the United States. Our Personal Lines Business writes insurance for private passenger automobiles and recreational vehicles. Our Commercial Auto Business writes primary liability, physical damage, and other auto-related insurance for automobiles and trucks owned by small businesses.

See the “Income Statements” and “Supplemental Information” for further month and year-to-date information and the “Monthly Commentary” at the end of this release for additional discussion.

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

INCOME STATEMENT

May 2009

(millions – except per share amounts) (unaudited)

	Current Month			Comments on Monthly Results1
Net premiums written	$	1,054.9
Revenues:
Net premiums earned	$	1,058.2
Investment income		41.3
Net realized gains (losses) on securities		(.4	)
Service revenues		1.3
Total revenues		1,100.4
Expenses:
Losses and loss adjustment expenses		776.3
Policy acquisition costs		102.9
Other underwriting expenses		128.7
Investment expenses		.8
Service expenses		1.4
Interest expense		11.8
Total expenses		1,021.9
Income before income taxes		78.5
Provision for income taxes		23.9
Net income	$	54.6
COMPUTATION OF EARNINGS PER SHARE
Basic:
Average shares outstanding		669.3
Per share	$	.08
Diluted:
Average shares outstanding		669.3
Net effect of dilutive stock-based compensation		5.6
Total equivalent shares		674.9
Per share	$	.08

¹ See the Monthly Commentary at the end of this release for additional discussion. For a description of our reporting and accounting policies, see Note 1 to our 2008 audited consolidated financial statements included in our 2008 Shareholders’ Report, which can be found at www.progressive.com/annualreport.

The following table sets forth the comprehensive income for the month:

Net income	$	54.6
After-tax changes in:
Net unrealized gains (losses) on securities		190.5
Net unrealized gains on forecasted transactions		.1
Comprehensive income	$	245.2
Per share	$	.36

The following table sets forth the investment results for the month:

Fully taxable equivalent total return:
Fixed-income securities	2.5	%
Common stocks	5.6	%
Total portfolio	2.6	%
Pretax recurring investment book yield	3.7	%

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

INCOME STATEMENTS

May 2009 Year-to-Date

(millions – except per share amounts)

(unaudited)

	Year-to-Date					% Change
	2009			2008
Net premiums written	$	5,992.3		$	5,954.5	1
Revenues:
Net premiums earned	$	5,787.0		$	5,751.6	1
Investment income		213.3			260.2	(18	)
Net realized gains (losses) on securities		(71.2	)		40.9	NM
Service revenues		6.3			7.4	(15	)
Total revenues		5,935.4			6,060.1	(2	)
Expenses:
Losses and loss adjustment expenses		4,026.5			4,164.6	(3	)
Policy acquisition costs		567.6			575.4	(1	)
Other underwriting expenses		643.8			641.0	0
Investment expenses		4.5			3.4	32
Service expenses		7.8			9.0	(13	)
Interest expense		56.7			57.2	(1	)
Total expenses		5,306.9			5,450.6	(3	)
Income before income taxes		628.5			609.5	3
Provision for income taxes		225.2			181.9	24
Net income	$	403.3		$	427.6	(6	)
COMPUTATION OF EARNINGS PER SHARE
Basic:
Average shares outstanding		668.8			670.0	0
Per share	$	.60		$	.64	(6	)
Diluted:
Average shares outstanding		668.8			670.0	0
Net effect of dilutive stock-based compensation		4.2			5.9	(29	)
Total equivalent shares		673.0			675.9	0
Per share	$	.60		$	.63	(5	)

NM = Not Meaningful

The following table sets forth comprehensive income for the year-to-date period:

	2009			2008
Net income	$	403.3		$	427.6
After-tax changes in:
Net unrealized gains (losses) on securities		171.9			(232.2	)
Net unrealized gains on forecasted transactions		(.8	)		(1.2	)
Comprehensive income	$	574.4		$	194.2
Per share	$	.85		$	.29

The following table sets forth the investment results for the year-to-date period:

	2009		2008
Fully taxable equivalent total return:
Fixed-income securities	3.6	%	.6	%
Common stocks	4.0	%	(3.1	)%
Total portfolio	3.3	%	0	%
Pretax recurring investment book yield	3.9	%	4.6	%

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL INFORMATION

May 2009

($ in millions)

(unaudited)

Current Month
	Personal Lines Business									Commercial Auto Business			Other Businesses1		Companywide Total
	Agency			Direct			Total
Net Premiums Written	$	569.3		$	363.0		$	932.3		$	121.2		$	1.4	$	1,054.9
% Growth in NPW		(1	)%		8	%		2	%		(12	)%		NM		1	%
Net Premiums Earned	$	561.4		$	371.1		$	932.5		$	123.9		$	1.8	$	1,058.2
% Growth in NPE		(1	)%		8	%		2	%		(10	)%		NM		1	%
GAAP Ratios
Loss/LAE ratio		73.9			73.0			73.6			72.6			NM		73.4
Expense ratio		22.2			21.3			21.8			21.9			NM		21.9
Combined ratio		96.1			94.3			95.4			94.5			NM		95.3
Actuarial Adjustments2
Reserve Decrease/(Increase)
Prior accident years															$	(1.5	)
Current accident year																(2.0	)
Calendar year actuarial adjustment	$	(2.5	)	$	(1.7	)	$	(4.2	)	$	.7		$	0	$	(3.5	)
Prior Accident Years Development
Favorable/(Unfavorable)
Actuarial adjustment															$	(1.5	)
All other development																(10.9	)
Total development															$	(12.4	)
Calendar year loss/LAE ratio																73.4
Accident year loss/LAE ratio																72.2
Statutory Ratios
Loss/LAE ratio																73.3
Expense ratio																22.2
Combined ratio																95.5

¹ Primarily includes professional liability insurance for community banks and Progressive’s run-off businesses. The other businesses generated an underwriting profit of $.4 million for the month. Combined ratios and % growth are not meaningful (NM) due to the low level of premiums earned by, and the variability of loss costs in, such businesses.

² Represents adjustments solely based on our corporate actuarial reviews.

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL INFORMATION

May 2009 Year-to-Date

($ in millions) (unaudited)

Year-to-Date
	Personal Lines Business									Commercial Auto Business			Other Businesses1		Companywide Total
	Agency			Direct			Total
Net Premiums Written	$	3,166.1		$	2,115.7		$	5,281.8		$	702.0		$	8.5	$	5,992.3
% Growth in NPW		(1	)%		9	%		3	%		(12	)%		NM		1	%
Net Premiums Earned	$	3,081.9		$	2,003.2		$	5,085.1		$	691.9		$	10.0	$	5,787.0
% Growth in NPE		(1	)%		7	%		2	%		(8	)%		NM		1	%
GAAP Ratios
Loss/LAE ratio		69.8			71.1			70.3			64.8			NM		69.6
Expense ratio		21.0			20.5			20.8			21.4			NM		20.9
Combined ratio		90.8			91.6			91.1			86.2			NM		90.5
Actuarial Adjustments2
Reserve Decrease/(Increase)
Prior accident years															$	(9.3	)
Current accident year																(3.7	)
Calendar year actuarial adjustment	$	(6.9	)	$	(4.3	)	$	(11.2	)	$	(1.8	)	$	0	$	(13.0	)
Prior Accident Years Development
Favorable/(Unfavorable)
Actuarial adjustment															$	(9.3	)
All other development																(15.8	)
Total development															$	(25.1	)
Calendar year loss/LAE ratio																69.6
Accident year loss/LAE ratio																69.2
Statutory Ratios
Loss/LAE ratio																69.6
Expense ratio																20.6
Combined ratio																90.2
Statutory Surplus															$	5,224.8

NM = Not Meaningful

¹ The other businesses generated an underwriting profit of $2.1 million.

² Represents adjustments solely based on our corporate actuarial reviews.

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

BALANCE SHEET AND OTHER INFORMATION

(millions – except per share amounts)

(unaudited)

	May 2009
CONDENSED GAAP BALANCE SHEET:1
Investments – Available-for-sale, at fair value:
Fixed maturities (amortized cost: $11,134.6)	$	10,848.1
Equity securities:
Nonredeemable preferred stocks2 (cost: $844.0)		1,162.8
Common equities3 (cost: $290.7)		400.7
Short-term investments (amortized cost: $1,140.2)		1,140.2
Total investments4,5		13,551.8
Net premiums receivable		2,556.2
Deferred acquisition costs		436.7
Other assets5		2,328.9
Total assets	$	18,873.6
Unearned premiums	$	4,379.8
Loss and loss adjustment expense reserves		6,168.3
Other liabilities		1,340.8
Debt		2,176.2
Shareholders’ equity		4,808.5
Total liabilities and shareholders’ equity	$	18,873.6
Common Shares outstanding		680.9
Shares repurchased – May		0
Average cost per share	$	0
Book value per share	$	7.06
Trailing 12-month return on average shareholders’ equity		(2.1	)%
Net unrealized pretax gains (losses) on investments	$	158.5
Increase (decrease) from April 2009	$	293.0
Increase (decrease) from December 2008	$	276.7
Debt-to-total capital ratio		31.2	%
Fixed-income portfolio duration		2.8 years
Weighted average credit quality		AA+
Year-to-date Gainshare factor		.82

¹ Loss and loss adjustment expense reserves are stated gross of reinsurance recoverables on unpaid losses of $243.9 million.

² As of May 31, 2009, we held certain hybrid securities and recognized a change in fair value of $12.4 million as a realized loss during the period we held these securities.

³ As of May 31, 2009, we held equity options which generated a $3.8 million loss.

⁴ Includes $6.4 billion of short-term investments and U.S. Treasury securities.

⁵ Total investments excludes $9.0 million of net unsettled security transactions, which are included in “other assets” in May.

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Monthly Commentary

• During May, we reduced staffing in our Claims organization by about 280 people, or around 2% of our Claims workforce countrywide. The reductions were primarily in management, increasing the ratio of claim representatives per manager to levels that reflect recent process improvements and the sustainability of current claims quality. As a result, approximately $7.5 million of severance and related expense associated with this action are included in our May results.

Upcoming Events

As previously announced, Progressive will host a simultaneous webcast of its 2009 Investor Relations Meeting on Thursday, June 11, 2009, beginning at 9:00 a.m. eastern time. The meeting will last approximately three hours and will include a question and answer session following the presentations. The meeting will also be available simultaneously, in a listen-only format, by phone. Participants via the phone will not be able to submit questions during the question and answer session. To attend the webcast or to receive the call-in instructions, visit our Web site at http://investors.progressive.com/events.aspx. Information that is distributed at the meeting will be made available at the Web site on the morning of the meeting.

We are currently scheduled to release June results on Friday, July 10, 2009, before the market opens.

About Progressive

The Progressive Group of Insurance Companies, in business since 1937, is one of the country’s largest auto insurance groups, the largest seller of motorcycle policies and a market leader in commercial auto insurance based on premiums written.

Progressive is committed to becoming consumers’ #1 choice for auto insurance by providing competitive rates and innovative products and services that meet drivers’ needs throughout their lifetimes, including superior online and in-person customer service, and best-in-class, 24-hour claims service, such as its concierge level of claims service available at service centers located in major metropolitan areas throughout the United States.

Progressive companies offer consumers choices in how to shop for, buy and manage their auto insurance policies. Progressive offers its products, including personal and commercial auto, motorcycle, boat and recreational vehicle insurance, through more than 30,000 independent insurance agencies throughout the U.S. and online and by phone directly from the Company. Private passenger auto products and prices are different when purchased directly from Progressive or through independent agencies. To find an agent or to get a quote, go to http://www.progressive.com.

The Common Shares of The Progressive Corporation, the Mayfield Village, Ohio-based holding company, are publicly traded at NYSE:PGR. For more information, including a guide to interpreting the monthly reporting package, visit http://www.progressive.com.

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Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995: Statements in this release that are not historical fact are forward-looking statements that are subject to certain risks 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 estimates, assumptions, and projections generally; inflation and changes in economic conditions (including changes in interest rates and financial markets); the financial condition of, and other issues relating to the strength of and liquidity available to, issuers of securities held in our investment portfolios and other companies with which we have ongoing business relationships, including counterparties to certain financial transactions; the accuracy and adequacy of our pricing and loss reserving methodologies; the competitiveness of our pricing and the effectiveness of our initiatives to retain more customers; initiatives by competitors and the effectiveness of our response; our ability to obtain regulatory approval for requested rate changes and the timing thereof; the effectiveness of our brand strategy and advertising campaigns relative to those of competitors; legislative and regulatory developments; disputes relating to intellectual property rights; the outcome of litigation pending or that may be filed against us; weather conditions (including the severity and frequency of storms, hurricanes, snowfalls, hail, and winter conditions); changes in driving patterns and loss trends; acts of war and terrorist activities; our ability to maintain the uninterrupted operation of our facilities, systems (including information technology systems), and business functions; court decisions and trends in litigation and health care and auto repair costs; 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. 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 a reserve is established for one or more contingencies. Also, our regular reserve reviews may result in adjustments of varying magnitude as additional information regarding pending loss and loss adjustment expense reserves becomes known. Reported results, therefore, may be volatile in certain accounting periods.

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