PGR Progressive Corporation 10-K 2023-12-31 section summaries

Business profile and competitive position

Progressive is a nationwide insurance holding company focused primarily on personal and commercial auto, with additional residential property, small-business, workers’ compensation and related offerings. Its strategy emphasizes competitive, data-driven pricing, broad customer needs, strong brand and customer relationships. The company’s “Destination Era” strategy aims to deepen relationships and increase product bundling, which Progressive says is associated with longer retention and generally lower claims costs.

Progressive ranked second in U.S. private passenger auto by 2022 premiums and believes it retained that position in 2023. It ranked first in U.S. commercial auto, a position held since 2015, and believes it remained first in 2023. In homeowners insurance it ranked tenth by 2022 premiums and estimates it retained that rank in 2023.

Personal Lines is sold directly through web, mobile and phone channels, as well as through independent agents and strategic alliances. Agency initiatives include nearly 7,500 Platinum agents at year-end 2023 and the Portfolio quoting system. Direct offerings include auto/property bundles and multi-carrier property quoting through HomeQuote Explorer. Progressive also refers customers to unaffiliated products, earning commissions reported as service revenues.

Products, pricing and operating risks

Progressive regularly updates state-specific auto models with additional risk variables. Its Snapshot usage-based insurance is offered in all states except California and uses device or mobile-app driving data. Commercial auto programs include Smart Haul, which uses motor-carrier electronic logging device data, and Snapshot ProView, which offers discounts and fleet-management services. Progressive views its experience analyzing data from billions of driving miles as a competitive advantage, while recognizing risks from rapid technology change, competitors’ patents, cyber incidents and third-party vendor disruptions.

Commercial Lines serves small businesses, for-hire transportation, contractors, specialty trucking, towing, businessowners policies (BOP) and transportation-focused workers’ compensation. The 2021 acquisition of Protective Insurance expanded offerings for larger fleets, trucking workers’ compensation, independent contractors and affinity programs. Transportation network company (TNC) business increased as a share of Commercial Lines net premiums written; premium estimates depend partly on projected policy-term miles and are adjusted as mileage develops, exposing results to utilization changes. BOP was available to agents in 44 states at year-end 2023, with further expansion planned for 2024.

Competition is intense across direct and agency channels, with price-comparison tools and competitors’ marketing and digital investment adding pressure. Progressive emphasizes risk segmentation and pricing, expense control, service, claims handling and brand. It handles nearly all vehicle claims with employees and uses nearly 3,600 third-party repair shops; independent adjusters were used selectively to manage claim inventory and catastrophe response. Property claims are handled by employees and independent field adjusters; Progressive had about 1,100 Property claims employees at year-end 2023 and planned to increase internal staffing in 2024.

Catastrophe exposure and reinsurance

Property exposure includes hurricanes and severe weather, with writings and losses seasonally higher in warmer months. In the 2023 Property occurrence excess-of-loss program, Progressive retained the first $200 million of losses and allocated loss adjustment expenses (ALAE) for the first event. Net-of-retention limits were $2.4 billion for a first Florida event and $2.0 billion outside Florida; subsequent-event protection depended on prior losses, location and contract limits. No 2023 storm losses were ceded under this occurrence program or separate June–December named-storm coverage. That seasonal coverage was $125 million in 2023 and renewed at $175 million for 2024. A catastrophe bond matured in February 2024, reducing maximum coverage limits by $200 million.

For 2023, aggregate excess-of-loss retention thresholds were $500 million–$575 million for the first layer, excluding named tropical storms and hurricanes, and $600 million for the second layer, which included named storms. Coverage was up to $100 million and $85 million, respectively; the first annual retention threshold was exceeded by $17.9 million. The 2024 program provides $185 million total coverage: an $85 million first layer with a $450 million–$475 million retention, excluding named storms, and a $100 million second layer with a $525 million retention, including named storms. Coverage limits and retentions leave Progressive exposed to losses beyond protection, multiple events and contract limits.

Commercial Lines also uses quota-share and excess-of-loss reinsurance. Retentions include $2 million for BOP and $5 million for commercial auto UM/UIM per occurrence or property loss; large-fleet auto retains the first $2 million, with up to $3 million of coverage above retention. Workers’ compensation catastrophe coverage is up to $74 million per occurrence, subject to a $20 million one-life sublimit; Progressive generally retains about $1.3 million per occurrence through its reinsurance arrangements. Some TNC quota-share capacity is placed with reinsurers owned by the TNC company, with recoverables contractually collateralized to a target of more than 100%.

Capital, investments and reserves

At year-end 2023, net premiums written were $61.6 billion and statutory surplus was $22.2 billion, a combined premiums-to-surplus ratio of 2.8:1. Progressive describes roughly 3:1 as the historical general benchmark and target for vehicle businesses, while Property maintains a lower ratio. Statutory surplus can constrain premium growth; the company also had access to $4.2 billion of securities in a non-insurance subsidiary that could be contributed to insurance-subsidiary capital. Risk-based capital ratios exceeded minimum requirements at December 31, 2023.

The portfolio is primarily short- and intermediate-term investment-grade fixed income, alongside equity securities; investment decisions include ESG assessments. Loss and ALAE reserves are undiscounted actuarial estimates of ultimate unpaid claims, including case reserves and incurred-but-not-reported claims. Estimates are revised as claims develop, and prior-year changes affect current results. Severity trends, inflation, underwriting, policy terms, claims practices and economic conditions can cause actual costs to differ from assumptions, creating earnings variability.

Regulation and workforce

Insurance regulation covers rates, underwriting, policy terms, cancellations, capital, investments and affiliate transactions. Rate-approval delays can impair competitiveness, while restrictions on market exits or non-renewals can delay withdrawal from unprofitable business. Emerging rules address consumer data, privacy, cybersecurity, credit and other rating data, AI and algorithms, pricing and insurer profitability. Insurers may also face guaranty-fund assessments and assigned-risk obligations.

Progressive had about 61,400 employees at December 31, 2023; 60% were women and 41% were people of color. Annualized retention was 86%, up 3 percentage points from 2022, and more than 16,000 employees had over ten years’ tenure. The employee engagement survey placed the company in the top 5% of more than 1,000 participating U.S. employers. Progressive hired more than 14,600 people in 2023 and filled over 70% of above-entry-level openings through internal promotions. People of color represented 18% of approximately 1,100 senior leaders, up from 17% in 2022; the company’s aspiration is 20% by the end of 2025, from a 10% baseline. Nearly all employees participate in Gainshare, an annual cash incentive tied to insurance growth and profitability; senior leaders also receive equity awards.

Principal risks and business strategy

Progressive’s strategy is to grow as quickly as it can while maintaining high-quality customer service, but underwriting profitability takes priority over growth. Its target is a calendar-year combined ratio at or below 96. The company emphasizes long-term enterprise value over short-term earnings, stock performance, dividends, annual underwriting profit, growth, or EPS. It does not provide earnings guidance or comment on analyst estimates; results that differ from market expectations may therefore increase equity and debt price volatility. The Property business has contributed, and is expected to continue contributing, volatility to consolidated results.

Underwriting, claims, and catastrophe exposure

Results depend on accurately estimating risk, setting adequate rates, and obtaining timely regulatory approval for rate changes. Inadequate data, model or assumption errors, delayed recognition of loss trends, or changing claims, operating, and reinsurance costs can lead to underpricing and weaker margins, or overpricing that reduces competitiveness and growth. Restrictions on rating factors such as credit, education, and occupation could also weaken risk-based pricing.

Property-and-casualty loss reserves are estimates; ultimate claims and adjustment expenses may materially exceed recorded reserves. Uncertainty arises from inflation and changing medical, repair, labor, and construction costs; labor shortages; litigation and regulatory changes; fraud; claims practices; catastrophes; and the reliability of historical data and actuarial assumptions. Inaccurate, unfair, or delayed claim payments, or ineffective deployment of claims resources, could increase costs and litigation and harm customer retention and results.

Severe weather and other events—including hurricanes, hailstorms, floods, fires, cyberattacks, and pandemics—can materially harm results. Progressive’s Property segment may be more affected than other businesses, and its Property policies are concentrated in states with significant hurricane and hail exposure. Catastrophe models rely on historical data and assumptions that may become less reliable as climate change alters event frequency, severity, duration, and location.

Progressive relies on reinsurance for Property and portions of Commercial Lines. Retentions and aggregate limits, disputes or insolvency among reinsurers, and constrained industry capacity can leave the company exposed or make coverage costly or unavailable. Progressive remains liable to policyholders even when risks are reinsured; inadequate or expensive coverage could constrain business volume, profitability, or financial condition.

Competition, growth, and execution

Progressive competes with large national and international insurers, regional carriers, vehicle manufacturers, insurtechs, and other well-funded entrants. Competition on price, brand, scale, marketing, innovation, underwriting, and costs—along with bundled or lower-priced offerings—may reduce new business or retention. Auto is a significant part of the business and may face reduced demand or rates from vehicle technology, autonomous driving, and vehicle sharing. Commercial Lines is an important growth opportunity but is exposed to weaker demand or profitability, including in commercial auto, trucking, and ride-sharing. Insurance cycles are difficult to identify in real time; soft-market price competition can reduce revenue and profitability. Industry consolidation may intensify competition, while insurer or state catastrophe-fund insolvencies could trigger assessments or unexpected policyholder inflows.

New insurance products and non-insurance ventures, investments, acquisitions, joint ventures, and partnerships may require significant spending and fail to meet expectations. New products can involve unfamiliar coverage limits, pricing, claims, and reserving risks for which existing systems, data, and models may be less effective. Technology, data, cloud and software-as-a-service dependencies, changing customer preferences, and operational complexity may require costly system upgrades and make it harder to serve customers and independent agents effectively.

The company also depends on attracting and retaining skilled employees and managing staffing as sales, claims, or major-customer needs change. Labor-market pressures, forecasting errors, or delayed hiring and training adjustments may increase costs or impair service, morale, and margins. Fraud or misconduct by employees, agents, vendors, customers, or other parties may cause financial loss, disruption, or regulatory consequences despite internal controls.

Regulation, technology, and reputation

Insurance subsidiaries operate under complex rules across the U.S., Puerto Rico, Bermuda, and Canada. Rate approvals and restrictions on underwriting, pricing, market exits, policy termination, marketing, AI and third-party data, investments, IT, and cybersecurity can limit responses to costs and market conditions. Compliance costs, investigations, fines, litigation, insurer-insolvency assessments, or loss of operating authority could materially affect results. Lawsuits may seek substantial damages or require changes to business practices.

AI introduces risks from biased, flawed, or insufficient information, as well as evolving regulation. The NAIC has issued AI principles and a model bulletin, adopted by Alaska; Progressive expects adoption by some additional states. Colorado has adopted AI governance rules for life insurers and plans to extend them to auto. Regulatory restrictions or perceived noncompliance could impair profitable business. Vendor AI practices and faster competitor adoption add exposure. Patent disputes and uncertainty over intellectual-property rights, including AI-generated material, may also lead to litigation, damages, or costly process changes.

Cyberattacks on Progressive or its vendors may steal or corrupt data, facilitate fraud or ransom demands, or disrupt services. Vendor integrations and security controls cannot eliminate the risk; a serious incident could cause remediation costs, liability, operating disruption, loss of trade secrets, and reputational harm. Disruptions to systems, facilities, communications, payment networks, employees’ ability to work remotely, or critical vendors could impede policy servicing, claims handling, and payments.

Brand and reputation matter in a heavily advertised market. Ineffective campaigns or issues involving a spokesperson, company practices, governance, employees, ESG commitments, or third parties may damage demand, recruiting, retention, or stock value. Conflicting stakeholder expectations, social media, adverse publicity, or activist campaigns can amplify these effects.

Investments, liquidity, capital, and other risks

Progressive’s portfolio is principally fixed-income securities and common equities. Interest-rate, credit, concentration, prepayment and extension, liquidity, rating, and market risks could reduce investment income, earnings, or capital. Equity index tracking does not eliminate market or sector risk or ensure index performance. Investment losses could also impair insurance subsidiaries’ ability to meet regulatory capital requirements or write new business. ESG and public-policy rules or pressures could constrain investments, require disclosures, reduce asset values, or raise costs.

Inability to access deposits or liquidate investments on favorable terms—including during bank, payment-system, capital-market disruption, or a U.S. government default—could impair claims payments, operations, and capital. Counterparty, reinsurer, insurance-partner, or government-program distress may cause losses and reduce capital. As a holding company, Progressive depends on subsidiary distributions; statutory capital requirements, distribution limits, ratings pressures, and regulatory approvals may constrain funds available for debt service, affiliates, capital returns, or other obligations. Downgrades could restrict market access, raise borrowing costs, weaken confidence, and affect premium growth; derivatives may require substantial collateral or permit termination after a downgrade. Dividends may vary substantially or be zero, and the Board may change policy.

Renewable-energy, historic-property, and affordable-housing investments depend on tax credits and other benefits that may be challenged, invalidated, or recaptured. A future epidemic or pandemic could intensify other risks, although Progressive says current COVID-19 impacts are not material.

Progressive converted its monthly accounting close to the Gregorian calendar in Q4 2023 during a multi-year financial-systems modernization effort. It expects no material impact on quarterly or annual results, but monthly year-over-year comparisons from October 2023 through September 2024 may be affected. Monthly disclosures may be modified or delayed during that period, potentially adding to stock-price volatility.

Cybersecurity

Progressive relies on complex internal technology and third-party systems to conduct its business and to store substantial volumes of sensitive customer and employee data, intellectual property, and financial and business information. Its cybersecurity program uses layered preventive and detective controls, ongoing assessments, and the ISO 27002 and NIST Cybersecurity Frameworks. Internal and external resources regularly evaluate the security environment and compliance. Vendor safeguards include risk assessments and financial due diligence, contractual confidentiality and use restrictions, and, where appropriate, rights to review vendor compliance. Employee awareness training and an incident-response program support threat recognition, mitigation, recovery, and required notifications.

The Chief Security Officer (CSO) leads cybersecurity and reports to the CFO, while regularly updating the CEO, executive team, and Board Technology Committee. The CSO has held the role for more than 11 years, has over 10 years of prior cybersecurity experience in the banking sector, and serves on the Management Risk Committee. The Board Technology Committee typically meets five times a year and oversees cybersecurity and broader technology, data privacy, legacy-system, continuity, and disaster-recovery risks.

Progressive and some of its vendors have experienced cyberattacks and other incidents, and threats occur regularly. Through the filing date, the company says these incidents and threats have not materially affected its business strategy, results, or financial condition, and are not currently believed reasonably likely to do so. However, it cannot rule out future material effects. Key ongoing risks include rapidly evolving threats, the challenge of deciding where to allocate security resources, and the possibility that controls may fail to prevent, detect, or contain an attack.

Premiums and insurance operations

Premium revenue increased across the three principal lines in 2023. Personal Lines remained the largest contributor. The schedules provide premium revenue and net premiums written, but no segment profit measure; segment expense allocations rely on assumptions and estimates, so results could differ under other allocation methods.

The increase in net premiums earned reflected higher gross premiums earned and lower cessions:

No premiums were assumed in either year.

Investment portfolio

At December 31, 2023, investments had fair value and balance-sheet value of $65.9986B, compared with cost of $65.9149B.

U.S. government and agency obligations were the largest fixed-maturity category, at $36.8694B fair value; asset-backed securities were $9.9323B. No non-U.S.-government issuer exceeded 10% of shareholders’ equity by aggregate cost or fair value.

Parent-company financial position and results

The following are parent-only, not consolidated, figures. Parent assets and equity increased year over year; long-term debt also rose.

The sharp increase in parent net income primarily reflected $3.5723B of undistributed income from subsidiaries, versus $325.0M in 2022. Goodwill and intangible assets are not separately presented in this parent-only balance sheet.

The parent had zero bank cash at each year-end, but unrestricted access to marketable securities held by a non-insurance investment subsidiary: $4.2B at year-end 2023, $4.4B in 2022, and $4.2B in 2021. FY2023 financing included $496.3M of net debt issuance proceeds. Common dividends paid were $234.0M; declared but unpaid common dividends were $497.9M, compared with $58.5M in 2022. Progressive redeemed all Series B preferred shares on February 22, 2024, for $507.8M, including accrued unpaid dividends.

Debt and other exhibits

The exhibit index lists $550M aggregate principal of 4.00% senior notes due 2029, and forms of 3.20% notes due 2030 and 3.95% notes due 2050, each associated with $500M aggregate principal. It also lists forms of 2.50% notes due 2027, 3.00% notes due 2032, 3.70% notes due 2052, and 4.95% notes due 2033. The index includes amendments through 2023 to Progressive’s discretionary PNC Bank credit line and an amended and restated credit-line note.

Compensation and governance exhibits include the 2024 Gainshare Plan; time- and performance-based restricted-stock-unit award forms, including awards tied to market-relative and investment-results measures; a CEO award-agreement amendment; and a Dodd-Frank clawback policy.

The independent auditor concluded that the financial statement schedules presented fairly, in all material respects, when read with the related consolidated financial statements.

Progressive (PGR) — FY2023 Financial Statements

Consolidated results

Revenue increased 25.2%, as premium growth and stronger investment results offset higher claims costs. The 2023 realized-gain result included $348.4 million of holding-period gains; security sales produced a $7.9 million loss. Progressive said equity sales in 2023 and 2022 were part of efforts to reduce portfolio risk. Separately reported net investment income rose 51.0% to $1.8656 billion, driven by higher rates on floating-rate holdings and reinvestment at higher coupons. FY2022 included a $224.8 million goodwill impairment.

Segment performance and underwriting

Investment operations contributed $2.245 billion of revenue and $2.219 billion of pretax profit in 2023, versus a $651.9 million revenue loss and $676.2 million pretax loss in 2022. Service businesses generated $310.1 million of revenue and a $38.9 million pretax loss, compared with $299.3 million and $2.6 million of profit. Interest expense was $268.4 million, versus $243.5 million. Commercial Lines underwriting weakened materially; Property returned to a small profit.

Cash flow, balance sheet and capital

Common shares outstanding were 584.9 million at the start of FY2023 and 585.3 million at year-end. Cash, cash equivalents and restricted cash ended the year at $99.6 million, down from $220.9 million. Common dividends declared were $672.7 million ($1.15 per share); $234.0 million was paid during the year. The company issued $500 million of 4.95% senior notes due 2033, receiving approximately $496.3 million net proceeds. There was no short-term debt outstanding.

The investment portfolio was mainly fixed maturities: $60.3782 billion fair value, against $62.4419 billion amortized cost. Fixed-maturity gross unrealized losses narrowed to $2.3468 billion from $3.5515 billion; management reported no material credit-related losses and expected principal and interest payments. Level 3 securities were $110.1 million, down from $121.9 million.

Claims, reinsurance and risks

Gross carried loss and LAE reserves rose to $34.3892 billion from $30.3593 billion; net reserves were $29.6002 billion, versus $24.8001 billion. FY2023 incurred losses included $1.0940 billion of unfavorable prior-year development, a reversal from $86.3 million favorable development in 2022. About $950 million related to accident year 2022 and $125 million to 2021. Personal Auto development reflected higher physical-damage severity and Florida injury and medical costs; Commercial Lines development reflected injury severity, frequency, late reporting and large losses, with about half tied to transportation-network-company business. The auditor identified reserve valuation as a critical audit matter; vehicle businesses represented about 92% of carried reserves.

Total reinsurance recoverables declined to $5.0939 billion from $5.8321 billion, partly due to settlement of Hurricane Ian losses. Regulated plans accounted for 65% ($3.3170 billion) of recoverables; MCCA alone represented $2.2721 billion, or 45%. Progressive monitors reinsurer credit and concentration risk. Statutory surplus increased to $22.2496 billion from $17.8799 billion; insurance subsidiaries paid $413.4 million in dividends to the parent and could pay up to $3.3651 billion in 2024 without prior regulatory approval, subject to restrictions.

Other notable items

The 2023 tax provision was $1.0013 billion (20% effective rate), versus $200.6 million (22%) in 2022. Cash incentive compensation increased to $897.3 million from $380.8 million; equity compensation was $121.3 million versus $122.7 million. Year-end restricted awards totaled 2.894 million, with 1.205 million estimated to vest and $93.3 million of unrecognized compensation cost. The company faces multiple insurance-related class and collective actions; losses were considered reasonably possible but not reasonably estimable. PwC issued unqualified opinions on the financial statements and internal controls, which were judged effective. In Q1 2024, Progressive redeemed all Series B preferred shares for $507.8 million, including accrued dividends.

2023 performance

Progressive’s growth accelerated: net premiums written increased 20% and earned premiums 19%. Underwriting profit rose as pricing and lower advertising costs more than offset higher claims costs, although unfavorable prior-year reserve development remained a significant drag. Net income also rebounded sharply from a weak 2022 comparison.

Insurance businesses

Total underwriting margin improved to 5.1% from 4.2%, and the combined ratio improved to 94.9% from 95.8%, against the company’s objective of 96 or better. Personal Lines’ margin rose to 6.2% (from 4.0%); Commercial Lines’ fell to 1.2% (from 8.9%); Property improved to 1.1% from a 10.5% loss margin. Commercial’s deterioration reflected higher losses, while Property benefited from an approximately 12-point improvement in its non-catastrophe loss ratio.

Growth, pricing and claims

Companywide policies increased 9%, adding 2.3 million. Net premiums written grew 24% in Personal Lines, 8% in Commercial Lines and 18% in Property. Personal auto rates rose about 19% across 48 states, following about 13% in 2022; new applications slowed after strong first-half growth as the company prioritized profitable growth. Commercial auto rates rose about 17%, but weak freight conditions and a shift away from higher-premium trucking pressured new-business premiums and retention. Property rates rose about 16%; Progressive steered growth toward lower-catastrophe-exposure states and began a Florida program to non-renew up to 115,000 policies starting in Q2 2024, while arranging a potential replacement-coverage option through an unaffiliated insurer.

Incurred losses included $40.8545B of paid losses and LAE and a $4.8001B increase in net reserves. Catastrophe losses, net of reinsurance and excluding LAE, were $1.7938B, versus $1.6604B in 2022. Prior-year development was $1.0940B unfavorable, compared with $86.3M favorable in 2022; about 65% of the 2023 unfavorable development came from Personal Auto, with Florida a major contributor. Personal auto severity growth eased to 8% from 13%, while frequency declined 2%; inflation in repair, vehicle and medical costs continued to pressure claims.

Advertising expense fell 21%, lowering its combined-ratio contribution by 1.4 points. The underwriting expense ratio declined 1.2 points, primarily due to premium growth and lower advertising.

Balance sheet, liquidity and capital

Operating cash flow increased $3.8B year over year, and totaled $25.3B over FY2021–FY2023. Premium collections grew faster than loss payments in 2023. Short-term investments and U.S. Treasury securities totaled $38.7B, or 58.6% of the investment portfolio. About half of loss and LAE reserves are typically paid within 12 months, and less than 20% remain unpaid after three years. Management expects positive operating cash flow and no near-term need to raise capital, subject to unforeseen changes.

Debt-to-total-capital declined to 25.4% from 28.7%, below Progressive’s policy target of less than 30%; pro forma for the Series B preferred redemption, the 2023 ratio would have been 25.8%. Senior notes totaled $7.0B principal, with $4.1B of future interest obligations; the next $1.0B aggregate maturity is in 2027. Progressive did not draw on its $300M discretionary credit line. It issued $500M of 4.95% senior notes due 2033 and repurchased 1.0M common shares for $140.7M. In February 2024, it redeemed all Series B preferred shares for $507.8M, including accrued dividends.

Investments and risks

The portfolio returned 6.3% on a fully taxable-equivalent basis in 2023, versus negative 7.8% in 2022. Fixed-income returns were 5.4% versus negative 6.6%, and common-stock returns were 26.7% versus negative 19.4%. Recurring investment income rose 50%; pretax recurring book yield increased to 3.1% from 2.4%. Group II securities represented 93.3% of the portfolio, up from 90.0%; fixed-income duration was 3.0 years and weighted-average credit quality AA-. The company reported no delinquencies in its CMBS portfolio, while noting commercial real estate refinancing and market conditions as risks.

Gross carried reserves were $34.4B; net reserves were $29.6B, including $22.5B of case reserves and $7.1B of IBNR. Personal and commercial auto liability represented about 92% of net reserves. A one-percentage-point change in the 2023 accident-year severity estimate would affect personal auto liability reserves by $201.9M and commercial auto liability reserves by $57.4M. Property catastrophe coverage provided up to $2.0B net of a $200M per-event retention, rising to $2.4B including Florida-specific programs. Reinsurance costs, catastrophe exposure, claim severity, reserve estimates and Florida loss trends remain material uncertainties.

Florida and Texas together accounted for 27.5% of written premiums, up from 25.9% in 2022. Other disclosed risks include competition, regulation and litigation, operational and cybersecurity disruptions, and investment-market volatility. The board had 12 directors, 11 identified as independent; the Progressive Insurance Foundation contributed an average of about $6M annually over the five years referenced.