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) September 16, 2010

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 September 16, 2010, 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, August 2010. 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: September 16, 2010

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 September 16, 2010, containing financial results of The Progressive Corporation and its consolidated subsidiaries for the month of, and year-to-date period ended, August 2010.

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EX-99

Exhibit 99

  NEWS RELEASE

The Progressive Corporation	Company Contact:
6300 Wilson Mills Road	Clark Khayat
Mayfield Village, Ohio 44143	(440) 395-2291
http://www.progressive.com

PROGRESSIVE REPORTS AUGUST RESULTS

MAYFIELD VILLAGE, OHIO — September 16, 2010 — The Progressive Corporation today reported the following results for August 2010:

(millions, except per share amounts and ratios)	August 2010			August 2009		Change
Net premiums written	$	1,146.5		$	1,149.3	0	%
Net premiums earned	$	1,110.1		$	1,058.1	5	%
Net income	$	66.5		$	55.0	21	%
Per share	$	.10		$	.08	23	%
Total pretax net realized gains (losses) on securities (including net impairment losses)	$	(13.8	)	$	5.6	NM
Combined ratio		93.1			95.5	(2.4	)pts.
Average diluted equivalent shares		661.1			673.0	(2	)%
NM = Not Meaningful
(in thousands)	August 2010			August 2009		Change
Policies in Force:
Agency – Auto		4,472.5			4,293.9	4	%
Direct – Auto		3,551.0			3,065.8	16	%
Total Personal Auto		8,023.5			7,359.7	9	%
Total Special Lines		3,665.1			3,493.2	5	%
Total Personal Lines		11,688.6			10,852.9	8	%
Total Commercial Auto		519.6			526.6	(1	)%

Progressive offers insurance to personal and commercial auto drivers throughout the United States. Our Personal Lines business writes insurance for personal autos and recreational vehicles. Our Commercial Auto business writes primary liability, physical damage, and other auto-related insurance for autos 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

August 2010

(millions – except per share amounts)

(unaudited)

	Current Month			Comments on Monthly Results1
Net premiums written	$	1,146.5
Revenues:
Net premiums earned	$	1,110.1
Investment income		45.1		Includes about $3.0 million of net prepayment income from the early retirement of a few commercial mortgage-backed securities.
Net realized gains (losses) on securities:
Other-than-temporary impairment (OTTI) losses:
Total OTTI losses		(.3	)
Non-credit losses, net of credit losses recognized on previously recorded non-credit OTTI losses		0
Net impairment losses recognized in earnings		(.3	)
Net realized gains (losses) on securities		(13.5	)
Total net realized gains (losses) on securities		(13.8	)
Service revenues		1.5
Total revenues		1,142.9
Expenses:
Losses and loss adjustment expenses		784.7
Policy acquisition costs		105.7
Other underwriting expenses		143.2
Investment expenses		.7
Service expenses		1.7
Interest expense		10.4
Total expenses		1,046.4
Income before income taxes		96.5
Provision for income taxes		30.0
Net income	$	66.5
COMPUTATION OF EARNINGS PER SHARE
Basic:
Average shares outstanding		655.8
Per share	$	.10
Diluted:
Average shares outstanding		655.8
Net effect of dilutive stock-based compensation		5.3
Total equivalent shares		661.1
Per share	$	.10

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 2009 audited consolidated financial statements included in our 2009 Shareholders’ Report, which can be found at www.progressive.com/annualreport.

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

INCOME STATEMENTS

August 2010 Year-to-Date

(millions – except per share amounts)

(unaudited)

	Year-to-Date
	2010			2009			% Change
Net premiums written	$	10,053.0		$	9,566.6		5
Revenues:
Net premiums earned	$	9,577.0		$	9,231.1		4
Investment income		347.7			332.9		4
Net realized gains (losses) on securities:
Other-than-temporary impairment (OTTI) losses:
Total OTTI losses		(17.5	)		(59.4	)	(71	)
Non-credit losses, net of credit losses recognized on previously recorded non-credit OTTI losses		5.5			23.8		(77	)
Net impairment losses recognized in earnings		(12.0	)		(35.6	)	(66	)
Net realized gains (losses) on securities		10.3			9.5		8
Total net realized gains (losses) on securities		(1.7	)		(26.1	)	(93	)
Service revenues		12.5			10.8		16
Net gain on extinguishment of debt		6.4			0		NM
Total revenues		9,941.9			9,548.7		4
Expenses:
Losses and loss adjustment expenses		6,713.2			6,505.9		3
Policy acquisition costs		908.1			900.6		1
Other underwriting expenses		1,188.0			1,048.0		13
Investment expenses		7.6			7.6		0
Service expenses		14.5			12.8		13
Interest expense		91.7			92.0		0
Total expenses		8,923.1			8,566.9		4
Income before income taxes		1,018.8			981.8		4
Provision for income taxes		331.6			329.3		1
Net income	$	687.2		$	652.5		5
COMPUTATION OF EARNINGS PER SHARE
Basic:
Average shares outstanding		659.8			668.5		(1	)
Per share	$	1.04		$	.98		7
Diluted:
Average shares outstanding		659.8			668.5		(1	)
Net effect of dilutive stock-based compensation		5.2			4.8		8
Total equivalent shares		665.0			673.3		(1	)
Per share	$	1.03		$	.97		7

NM = Not Meaningful

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

INCOME STATEMENT – OTHER INFORMATION

August 2010

(millions – except per share amounts)

(unaudited)

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

	Current			Year-to-Date
	Month			2010			2009
Net income	$	66.5		$	687.2		$	652.5
After-tax changes in:
Net unrealized gains (losses) on securities		1.8			266.0			473.7
Net non-credit related OTTI losses		0			(3.6	)		(15.5	)
Total net unrealized gains (losses) on securities		1.8			262.4			458.2
Net unrealized gains on forecasted transactions		(.3	)		(6.0	)		(1.6	)
Foreign currency translation adjustment		.3			0			0
Comprehensive income	$	68.3		$	943.6		$	1,109.1
Per share	$	.10		$	1.42		$	1.65

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

	Current		Year-to-Date
	Month		2010		2009
Fully taxable equivalent total return:
Fixed-income securities	.6	%	5.8	%	8.0	%
Common stocks	(4.3	)%	(3.6	)%	16.6	%
Total portfolio	.2	%	5.2	%	7.9	%
Pretax recurring investment book yield	3.7	%	3.6	%	3.8	%

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THE PROGRESSIVE CORPORATION AND SUBSIDIARIES

SUPPLEMENTAL INFORMATION

August 2010

($ in millions)

(unaudited)

Current Month

										Commercial
	Personal Lines Business									Auto			Other		Companywide
	Agency			Direct			Total			Business			Businesses1		Total
Net Premiums Written	$	589.1		$	450.6		$	1,039.7		$	106.8		$	0	$	1,146.5
% Growth in NPW		(3	)%		5	%		0	%		(5	)%		NM		0	%
Net Premiums Earned	$	574.1		$	421.4		$	995.5		$	113.7		$	.9	$	1,110.1
% Growth in NPE		3	%		12	%		6	%		(6	)%		NM		5	%
GAAP Ratios
Loss/LAE ratio		69.8			73.0			71.2			65.9			NM		70.7
Expense ratio		21.2			24.0			22.4			22.7			NM		22.4
Combined ratio		91.0			97.0			93.6			88.6			NM		93.1
Actuarial Adjustments2
Reserve Decrease/(Increase)
Prior accident years															$	8.0
Current accident year																10.4
Calendar year actuarial adjustment	$	8.8		$	4.8		$	13.6		$	4.8		$	0	$	18.4
Prior Accident Years Development
Favorable/(Unfavorable)
Actuarial adjustment															$	8.0
All other development																20.1
Total development															$	28.1
Calendar year loss/LAE ratio																70.7
Accident year loss/LAE ratio																73.2
Statutory Ratios
Loss/LAE ratio																70.7
Expense ratio																22.1
Combined ratio																92.8

¹ The other businesses generated an underwriting loss of $0.6 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

August 2010 Year-to-Date

($ in millions)

(unaudited)

Year-to-Date

										Commercial
	Personal Lines Business									Auto			Other		Companywide
	Agency			Direct			Total			Business			Businesses1		Total
Net Premiums Written	$	5,200.6		$	3,823.5		$	9,024.1		$	1,026.0		$	2.9	$	10,053.0
% Growth in NPW		3	%		12	%		6	%		(5	)%		NM		5	%
Net Premiums Earned	$	4,972.3		$	3,597.1		$	8,569.4		$	997.1		$	10.5	$	9,577.0
% Growth in NPE		1	%		12	%		5	%		(9	)%		NM		4	%
GAAP Ratios
Loss/LAE ratio		70.0			71.6			70.7			65.0			NM		70.1
Expense ratio		21.5			22.6			21.9			22.4			NM		21.9
Combined ratio		91.5			94.2			92.6			87.4			NM		92.0
Actuarial Adjustments2
Reserve Decrease/(Increase)
Prior accident years															$	98.5
Current accident year																52.1
Calendar year actuarial adjustment	$	65.4		$	44.4		$	109.8		$	40.8		$	0	$	150.6
Prior Accident Years Development
Favorable/(Unfavorable)
Actuarial adjustment															$	98.5
All other development																147.3
Total development															$	245.8
Calendar year loss/LAE ratio																70.1
Accident year loss/LAE ratio																72.7
Statutory Ratios
Loss/LAE ratio																70.1
Expense ratio																21.6
Combined ratio																91.7
Statutory Surplus															$	5,736.8

NM = Not Meaningful

¹ On a year-to-date basis, the other businesses generated an underwriting profit of $8.6 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)

	August 2010
CONDENSED GAAP BALANCE SHEET:
Investments – Available-for-sale, at fair value:
Fixed maturities1(amortized cost: $11,471.1)	$	11,801.9
Equity securities:
Nonredeemable preferred stocks1(cost: $617.1)		1,189.2
Common equities (cost: $1,003.8)		1,169.6
Short-term investments (amortized cost: $1,884.9)		1,884.9
Total investments2, 3		16,045.6
Net premiums receivable		2,844.0
Deferred acquisition costs		448.3
Other assets3, 4		2,369.0
Total assets	$	21,706.9
Unearned premiums	$	4,655.0
Loss and loss adjustment expense reserves4		6,933.7
Other liabilities		1,616.5
Debt		1,957.7
Shareholders’ equity		6,544.0
Total liabilities and shareholders’ equity	$	21,706.9
Common shares outstanding		663.5
Shares repurchased – August		1.8
Average cost per share	$	19.59
Book value per share	$	9.86
Trailing 12-month return on average shareholders’ equity		18.2	%
Net unrealized pretax gains (losses) on investments	$	1,065.5
Increase (decrease) from July 2010	$	2.8
Increase (decrease) from December 2009	$	403.7
Debt-to-total capital ratio		23.0	%
Fixed-income portfolio duration		2.0 years
Weighted average credit quality		AA
Year-to-date Gainshare factor		1.65

¹ As of August 31, 2010, we held certain hybrid securities and recognized a change in fair value of $3.2 million as a realized gain during the period we held these securities.

² Includes $5.7 billion of short-term investments and U.S. Treasury securities.

³ Total investments exclude $27.9 million of net unsettled security transactions, which are included in “other assets” as of August 31, 2010.

⁴ Loss and loss adjustment expense reserves are stated gross of reinsurance recoverables on unpaid losses of $664.0 million.

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Monthly Commentary

• August’s written premium growth rates reflect the variability in disclosing monthly results in combination with our fiscal calendar. Fiscal August 2010 includes August 29, 30, and 31, which do not reflect any six-month renewal premiums since February only has 28 days, while last year that three-day period fell in fiscal September. This had a negative effect on the reported written premium growth rates in August 2010 and will have a favorable effect on growth rates for fiscal September 2010.

Upcoming Events

We are currently scheduled to release September results on Thursday, October 14, 2010, before the market opens.

About Progressive

The Progressive Group of Insurance Companies makes it easy to understand, buy, and use auto insurance. Progressive offers choices so consumers can reach us whenever, wherever, and however it’s most convenient for them—online at http://www.progressive.com, by phone at 1-800-PROGRESSIVE, or in-person with a local agent.

Progressive offers insurance for personal and commercial autos and trucks, motorcycles, boats, recreational vehicles, and homes. We’re the fourth largest auto insurer in the country, the largest seller of motorcycle insurance, and a leader in commercial auto insurance. Progressive also offers car insurance online in Australia at http://www.progressivedirect.com.au.

Founded in 1937, Progressive continues its long history of offering shopping tools and services that save customers time and money, like Name Your Price, the Snapshot Discount, and a concierge level of claims service.

The Common Shares of The Progressive Corporation, the Mayfield Village, Ohio-based holding company, trade publicly at NYSE:PGR.

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 reported 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, including, but not limited to, health care reform and tax law changes; 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 claims activity becomes known. Reported results, therefore, may be volatile in certain accounting periods.

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