Progressive’s August Profits Cut in Half

Progressive reported its profits for August were a whopping 51 percent below its August 2012 profits, underperforming by $72.4 million. The insurer reported the results on Thursday.

The sharp year-over-year drop in Progressive profits appears to be an anomaly caused by abnormally high revenues the company saw in August 2012. In that month, Progressive reportedly liquidated $580 million in its stock portfolio, which led to a $119 million jump in profits from the previous August.

When you eliminate that anomaly and compare August 2013 with August 2011, the company actually saw a 200 percent increase in profits.

The company did see higher expenses this August compared with last August. The amount spent on losses jumped $40.6 million (an increase of 4 percent), and underwriting expenses jumped $36.9 million (an increase of 24 percent).

However, those increases in expenses were evened out by a $74.6 million increase in earned premiums (a 5 percent increase).

Progressive has done well in its recent financial history, with monthly profits coming in above $60 million every month for the past 12 months.

The direct-to-consumer car insurer’s profits for the first eight months of this year total $803 million. That’s 39 percent above the profits it saw during the same period last year.

Progressive stock was down 1.77 percent for the day as of 3:10 p.m. Eastern time.

To read about the experiences of current and former Progressive policyholders, readers can find user-submitted Progressive auto insurance reviews online.

About Ben Zitney
Benjamin Zitney has been covering the auto insurance industry for the past 2.5 years. Before coming to Online Auto Insurance News, he produced an extensive company history of the 30-year-old California Joint Powers Insurance Authority and worked at the Cal State Long Beach Daily Forty-Niner as a reporter, copy editor and news editor.

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