The Progressive Corporation (PGR) 7 May 242024 Q1 Earnings call transcript

Good morning, and thank you for joining us today for Progressive's first quarter investor event. I'm Douglas Constantine, Director of Investor Relations, and I will be moderator for today's event. The company will not make detailed comments related to its results in addition to those provided in its annual report on Form 10-K, quarterly reports on Form 10-Q and the letter to shareholders, which have been posted to the company's website.

Although our quarterly Investor Relations events often include a presentation on a specific portion of our business, we will instead use the 60 minutes scheduled for today's event for introductory comments by our CEO and a question-and-answer session with members of our leadership team. The introductory comments by our CEO were previously recorded. Upon completion of the previously recorded remarks, we will use the balance of the 60 minutes scheduled for this event for live questions and answers with members of our leadership team.

As always, discussions in this event may include forward-looking statements. from on and expectations actual uncertainties results differ based to are events are today's to risks during many that materially statements management's and current subject and event. These discussed those could cause

who risk XXXX. Additional discussions Form harbor in statements at of annual introductory affecting information first XX-Q of factors Investor documents the ended for report found related available today, as of CEO, XXXX, of to and for will our Tricia? website December other comments. Griffith, XX-K to the To investors.progressive.com. the concerning XX, forward-looking can pick safe the and And Form discussions supplemented businesses, is find statements pleased us risks year Relations those via our the our I'm you face. These uncertainties off challenges will on by of begin section our we introduce be quarter our Tricia

decision-making. in of when that second ratios loss started this In thank Good Since the you and predominant our has target. ways, XXXX, was indications stabilizing, subsequent a Even pressure severity and to half see more turned were we mid-XXXX, year morning, has accident effect us inflationary factor page. profit and we for today. felt been our margins have trends its like many first rate on strategic in joining in a earning approached our quarter

and cited put the belief and a I growth at prove goal. In put profit asked that to formula. to should in growth I August to our if perceived the continue time. capitalize values our target In to year call, instead opportunity our combined the my order flex on was XX aside our winning We calendar would XX be Investor before Relations strategy core deliver ratio on our we answer,

to absolutely sticking half we the to the stronger than of look XXXX quarter like that XXXX, inflation now the are, the since stellar tough ever turned and several well we By values last looks served for years off. we and the that feel we're the the benefits has of that second decisions of over long first back right took adhering hard it us seeing and call. the was work to core have who we As page results so

of capitalize Our and on to really profitability. first stage us quarter XXXX the both for growth has set

of During the premiums quarter, grew XX.X%. a XX%, net we ratio solid and written produced combined

reserve improvements In Mix over year margins the growth that growth into and to from seasonably Our rate pull of among to profitability year, strong prior was our continuing some spend as we Personal made history last did shift mean In non-rate X on our with added the on renewals the application We the able of ramping our factors. new more years book increase implemented over XXX,XXX year from non-rate less revisions focus the is best and media second the our in last and quarter Auto, loss quarter, rate the favorable first from our changes of first XXXX. frequency. of only the to development, back actions. retention force, in our earn on this segmentation quarters in took incredible up one in we in possible results. and we back we policies been continued calendar in we've other actions

to When auto March as and spend declined nearly applications comparing XXXX record compared to down quarter, were a down versus first media growth first auto the ] XXXX, spend year first the During both in the new spend flat. March were was gap to progressed. year quarter new last the The X% in X% year. ad and quarter sales XXXX, [ and quarter applications was up

growth We still tight. see the continue is opportunity as to for very market

have rate few a to approved. states actions we where still are we get working have and revisions We non-rate unwinding are

the we growth. profit between and As the our better of we marketing to to In seek calendar to forward the efficient our strike targets results look compared XXXX, spend, Commercial maximizing quarter XXXX. to rest year will Lines, as first right saw balance continue

business well Our in continues XXXX core commercial of with revisions to XXXX. to points almost XX still in from earn run rates and

our And in decline so As in XX-month longer market it as of policies be lines our a XX% in to on targets. earn to terms, are in for auto. market we result, rates continues The personal a and in soft for-hire transportation takes year-over-year experiencing specialty to macroeconomic trucking as commercial reminder, factors. much are compared business policies insurance to due force

force are year-over-year X Policies on perspective, X.X the states execute decreased in states grew growing state. states our in and products. about less quarter underwriting our and that both X% to we property, year-over-year strategy While our the to segmentation catastrophe the in XXXX our XX% first from premium profiles model, and reduce segmentation in which to on unit improves now a improve product. about weather BMTs our have other prone volatile the growing exposure states, X and volatile have in product nonvolatile of We throughout continue

a difficult look us, is the heading. future predict shouldn't years several it's the While as in results to into are last quarter the where deeply uncertainty of unpredictable, single too the shown has we results

about focus pivoting to stabilizing, Given is able bites in marketplace years. still of to a future. It's of states, what we're comes small where, normalized can now, take we're Inflationary and can positioned on the from are growth it believe we however, reeling that market well more when rate on know last and to showing apple challenges our the and comforting we that be we most to X capitalize of trends to operation indications increasing report a we're share. profit the the encouraged

the take questions. potential you for undoubtedly challenges and now our stand where we joining While ahead, again to in we're future. Thank lay forward look your us, and maximizing in confident today I'll

portion of event. have answer members today's Instructions]. This to now We recorded management concludes of previously available team our live questions. [Operator the

question. We take will now our first

Bob line with of first Morgan Stanley. comes from Huang the The question

to just On retention. coming retention, your head improved to forward? position curious and regarding broadly for forward going personal your as unlikely see market property dynamics, view on XXXX, share potentially the market is you're we is question challenging you business. growth broader talked lines going only XX-Q, in positioned about competitive both terms do people your then be company just given general. in of And speaking, retention that the retention in into First you in that

] good about our [ to retention XX. feel know think we continue Bob, you of Yes. I grail our our trailing is sort holy

stable because months We're Our I that's want. in now, focus what consumers like X on going really rates just is said comments flat. to said, like opening having more the we

rates. go sure they got shop, competitive we We've have the to leave. will So rate if is to to make then is better, option their

So as and we about units about PIF, of just we both new new the about think about renewals. think think our and growth, business. service We business, growing we think renewal

we'll having of focus on the So continuing continue be to and on that, competition. to rates more focus ahead stable

on distribution hypothetical. is -- is more little follow-up your this My channel, bit and Okay. the a

underwriting margin channel, a obviously of versus your less have direct agency. bit Your an little

model? your assume a is continue to As to direct to growth overall that's growth personal you we ratio going sort underwriting personal that of going to fair channel of your combination somewhat the your forward, combined for the our normalize be of channel current things focus for it Should challenge have bit on a focus nature a continue growth, side? -- push line given mix with to to and that expect margin on the headwind distribution of

We're we media. course, in expense start see in to increase direct focus growth you going ratio, both as channels. But on the on specifically the side to the of will trend

I more you area. it March the developed as was in was if January, you was the look -- spend. If XX was February points. That putting more and media quarter around XX look pressure was on the at XX.X, --

then can as as much as Now when expense in at and we non-acquisition spend look we as look we media ratios efficient. it's long at

the look look we're of at, at obviously, when at So we're ratios, on. going overall business combined to type we bringing

the have to on preference And we the bundled We segmentation industry. a have best believe we in bring business. model

to part rate So of understanding big that's a the risk.

all flow really to thrilled the be even continue able headwinds all and growth and uncertainty we're able method continue been together. to to exciting. with to excited margins -- on because be really But the able at still to these to our So is we've the all those last grow but grow, years,

of line next Zaremski question from Michael the BMO. comes with The

through organic Auto. Historically, not come of amount the but on in of kind Progressive's growth April sales Personal every disproportionate time frame. historically a the Question have January year,

what not, type right should you thinking And that we the Given factors be if about? the dynamics, do be feel should current of about? thinking seasonality we that's

Yes.

of think bullish stop other that's little from growth margin. though, things on is -- measure basis, the kind our a unit tax we that that growth. a of basis. a lot of year, wouldn't to very -- think that pressures in and bit happen about basis a there last feel a on trying you necessarily because this I continued are because about yearly growing, preferred we our both even of our premium know were I actually year and comes refunds I

more actions, continue it's ability so a want our -- couple back of to still to to have things. our do levers there. all to going be about nonrate We we there's So roll

We media target target than juncture, least XX have premium better to had we our this to that to earning have then at we're to points spend wide at premium be the swath in going the our believe margins. We're able have not that to and we -- XX. our and those get about margin to of

growth. able have So to pull of lot levers really we to to maximize be a

notice what that's several was going word, management in the growth, the maximize times to about and riding I statements maximize throughout opening You'll we analysis we're and use And about letter, this it versus do. absolutely my because the And talked the optimize. right we to is I word in XX-Q. felt exactly discussion as right said were my

letters, want today this I I touched just follow-up, know but you've My confirm. on and to bit if a even past

full a [ the you ratio, quarter -- it's this couple expense is versus down so [ if lower maybe the make X about the at and which X than ratio excluding years the So 'XX, expense, In little LAE in bit levels year a previous of not little XX.X% a year, But of trend. ] levels. ad might look bit XQ ],

run confirm those this efficiency of kind wanted is in cyclicality a bounce here there whether kind structural around? could figures kind to of rate? Or that is Just a of

to depending the basis, absolute media. in highest And I mean want the have in on figures we're we've Clearly, on March, amount bounced what's going spent an was happening. more. spend around, to that ever

efficient. it's we're so spend as on more that And going to long as

want of at spectrum you the combined ratio. look think the to makes I whole up what

give investing that those important. But $X.XX out processes So we're goes LAE because down $X.XX with and ways to people, technology, Figuring of to back that's competitive at out loss comes expense both expenses, dollar push and we reduce loss. can constantly every those expense. adjustment really and and with between non-acquisition in out, prices, anywhere remember, to goes with

So that And a talk the to question. in property. It first that is something I it commercial little I sauce. risk. our special I segmentation and I really the think product a on passenger And models, now rate letters it's understanding in mentioned it piece auto two. about a lines you really of And and about when you or don't is be our I not year this my side, important, build get enough, think talk this different glimpses in private

building In product decades. fact, continuous we've ago, for XX we years have about this we many decided to model. needed But been

to continue do and in we XXXX, ramped those. started really so And 'XX. up We in XXXX

behind, it as couple we is there. investment. That a takes think that a we're ever state couple segmentation. a models miles constantly more of improving of and So of No lot than out put of

highlight about because are ratio decade. our ratio. I a understand So see rate give to models, They're sometimes the can They are probably the combined none. rest. built a but I phenomenal. lot And expense and product you over talked our that up continue They with never those groups peak second R&D groups risk, don't product the and in of to to goes enough that that. money segmentation, that's into But

down. ratios come expense can cetera. always A media and segmentation don't -- up down them we're to is having on great et models. spend, kind of trying So it I understanding obviously, indemnification the And depending push accuracy and while lot of

The the with next line Elyse question comes of Greenspan Wells from Fargo.

your you guys in an rate magnitude that the with increases having reconcile trying was to on retention. And Tricia, there both was increases that right, are the rate XX-Q, in I'm comment PLE highlighted and that about your slowed adverse In a then terms of comments, impact just frequency. quarter. X-month slowing

you tie slowing? that us To overall about just comment increase is and help comments So PLE your the any increases. about rate just rate color could that X-month level impact of

Elyse. Sure, Yes.

I through so getting think shop. so, will this many year to at playing juncture customers its rate bills their and in last are renewal increases you that the cause are

we always So getting knew that risk first to possibility customers that well the last on the losing at when needed street. year when happens. We rates were was as we're that a market, we

in increases while a next and trend. smaller basis, a position small the it's quarter. be, to on what obviously feel ahead really continue better and we don't those we to bites So stay trailing just That's why exactly to know take much you will inform take we're X lagged like we'll of

last that's my can more second QX how you you it advertising sense expect QX right to were give this about But on like spend just and are to a quarter's still then than the to you you guys advertising, compared how through in be plan call, positive had even cadence the historical? the given normal. year you when potentially question, It growth. sounds And and guys QX pointed asked of us being the

do if our in, with start. to levels long At Yes, to as have, as if I'll add. advantage spend want Pat, anything you And our margins use juncture to to efficient. that you we weigh we can, the this it's there's want

this We've we efficiently still in like got to if actions we until levers. add said, back inefficient we're that to a that, but it's states to to anything? to going on go Pat, pulled many feel do can we've capacity, like to growth. the believe the So leverage of maximize say other on that. I adequately lot room non-rate priced, want opportunity on won't' full do I I where have spend think we're And we really you

No, no, I think that's Thanks. great.

from comes with [ with question Jimmy of question ] from next Raymond comes Peters line The James. Hummer JPMorgan. The the Gregory next

called feels, to you service used on like what with like management areas organization pre-COVID. focus customer we that the out I'd relationship It compared impossible your get times, timely in the So question were to it's at in many to first almost letter. so

reporting the the wondering challenges on And with the if and finding so people comment I'm you and could sure you're having CRM compensated piece making you're growth and they're appropriately?

we've been that's to and growth. caveat where of support way But the caveat history brought And in great X% slow there to -- had when to really always about serve overall a our up That's can that. that which question. deserve billion, And billion I they if customers because the be supported. as a should goal is we ] $XX quarter-over-quarter been doing, PIF $X.X grow fast big [ have I growth can, comparing and we've our the in as have think our because, times we

customer and in X found our ago, We challenging, CRM retention a both it So years a invested organization. about perspective recruiting a compensation from and compensation a in a really years ago. some made few lot changes We've we digital service. and work should serve be are capacity customers our environment in of the tenure the fruits through want the better able investments and greater to. And those seeing they to for we to themselves

service. never we terms at Now rest of are in customer

want working we need they we're our digital frankly, are to really service about And online either that commitment. those services, just fact, call In which in, on because believe best-in-class. new could use customer customer be, fanatical to we a don't

one and to someone to answer some need need phone. they talk the really we to So

really feel service. have great been years I times handling difference -- and world mean, phone sales I both for the than X of Our ago.

about need think great growth. so I the staffing, in our maximizing giving positive And feel they one So to job the we've them and customers they I way help done reasons on other training a deserve. why the our tools that's of

the Maybe figure the you're large AI, one models, with generative that how in common would cetera. we're my be out to question et -- of areas the follow-up in is investing technology, language conjunction trying that,

share efficient. company spending how I So options much how to know you're emerging and what front, technology the whether be in to year? tools and But these your that to any make have on us this Or you're your willing on more company with available be to you're -- would you're deploying color you year versus interesting? how deploying going that don't last what

absolutely. Yes,

say to would are have sell a we happens to investing been step used technology back Lewis I well, what we insurance. Peter So company -- let say, is that me

do has we it. built everything technology So into

believe, IT always ahead we're that, trying trends. the to With I have, organization. best-in-class We of again, a stay

So think ability technology. We a part all of usage-based a language started of IT machine think place. innovative of start of and they're models over become those with to in the the they things, decade direct and put product, a even ago, probably they large insurance, in -- actually channel, with lot learning those we our though have and

So think coverage. Right XXX having have learning of lot well we've now, different can choice those for give that documents of a need We've like for what you models human we without Chatbot involved. give you over to And the we a you best a continued in machine and had different used formats. progressive.com. on

in a pretty full, got that are and We AI. AI. several full entire few tests we're company. we but be have Board really thoughts, And ago going lot in months doing all the single I including many and our it's an to some we some the we're every you, session go great it's can't of our with to because in Directors doing, aspect I day we're efficiencies tests, to get. going it's tell are game great a exciting. Some did models, details, that believe on of exciting bore a summer changer into generative of And

fact, think meeting into think biases So week, you have in of think that over have in media to AI. you that want a And We go want successful. Board this have responsible going be and about recruiting, technology. we're lean of to really proven some always AI to we to media. and test Clearly,

a we're competitive XX have we're sure think grow customers benefit last I we into have our So and we like every to prices, leaning test overlooks technology, with and to nearly we that that that make committee doing us using for I'm really share. responsibly. But so it just come it do years excited the stay we that market

The the next from Bank Josh of line of question with Shanker comes America.

Obviously, the that. on where you subject in capital. and you're about and earning it like capital capital the Robinsons, does still looks one the Can XX% grow more gating for factors areas is have internal larger gating without growth, that and tomorrow? of But growing stand it. company converting your have factor? which Where exposure in and you letter the do is there talk quarterly successfully you of the to terms than property extent And picking in Could homeowner how XX%, be past. the are was the much And the up that can you're to you is model capital accurate?

Sauerland, weigh John and you start I'll in. Yes. can

board, again, across But to one. in continue that. the growing so are we'll we We grow want

far we're and profile, in the I or states property volatile what about, we as as would growth states as are talked non-volatile shrinking we Our more weather, call state. we rowing in

quite into A put some time we ago. plan place lot a time. this been takes of that's So

took notify starting while non-renew last Florida a the the I policies homeowners we're DOI. XXX,XXX customers see As and we laid over in with to because that the needed start year, to talk out to

of has So to our the we have -- portfolio -- be that country. sort across our that to strategy believe long-term

about have regulatory So when think capital. you to you capital, have

having of think X:X So model. a auto

So if have capital that. and why incredibly happens, it's because you case crisis, even to capital capital to in And billion, -- now, is you that would storm, growth. Do unforeseen comfortable home for above to a I we financial million position, so for excited more which contingent $X in write an have product. this a I'm then capital. say something we are more have want even of need about have you $XXX big then there's you we volatile add And reason another anything? right in

Yes. Sure.

are requires the We Robinsons of than some product, right doesn't. that our now, of own and some growing more it home

a other of own result in product, So Tricia when our growing direct a at mentioned, look states, home our as shrinking maximum But as for And shift. number competitors' lot actually of in in come down actually the our sell channel, PML, we home probable we're non-volatile that's our losses states. we a so products. volatile

our the with We up X reinsurance risk got slightly there. and also competitive more taking recently are wrapped we actually And comfortable June renewals, we're very rates.

of great now. Tricia And a feel significant risk we noted, requires that we our generating some certainly, a quarter. with about growing first $X.X course, ample but we're the on -- of underwriting regulatory that as have that program. returns. right year-to-date as So investment lot, billion in capital probably are generating we billion of We're portion well management But year-over-year at degree capital. $X margins around to And

feel fast level very we again, our our hitting grow margins. can, and as as with we those comfortable to So ability capital

all quick Thank And detail. you one for the question.

going that end ratios an policies basis, of this we on capacity they'll to should higher to is that expect Florida lower you're enough the the at attritional rise? to that but renewing Loggerhead company, the added significant they is be although will lower, be the attritional benefit year, be added, loss of With when not your volatility

perspective, not a obviously, we is several I thing on from will answer. units believe which a for we depends I profitable. it, And really off has that clincher the been really last lot wanted the a lot, some couldn't of of loss weather, get to first, be mean course, years. first the

make sure we're why balanced. that just trying that's so more we're And to

makes Florida especially because need a of hard addition area. just ratios will we and ASI win still auto that sense too auto just which heavy other Florida in a -- little on couple very bit loss of and ball of don't was we Home based both states, what we about the in with happen of there base to have Progressive large weather. were kind are sort the think in because have I home bundled, now in to grew and large and when can we a believe But but We we crystal it's that

The next comes Michael question line from the Oppenheimer. of Phillips with

of thoughts mentioned because trends frequency state Can book some the your total on Florida, any because that? you've seen you Speaking you in what share favorable and the refunds. auto of on side of the property

No, side. you on Property mostly have auto much. [indiscernible] were Those little Pat? the a property, on we much, haven't seen side. There's the bit seen

statute It's early We've kind got different right? benefits play on that limitations. as got auto on We've immediate too we're the but time, property as the book. seeing to of not the will of through over tell side, of book assignment different

in you to what's policy auto, you Okay. the month. to is life when maybe dynamics the I And for around such And that? been that given then mentioned expectation level? hands guess high at shopping a predict get behind improving to has all your harder and month month

because think rates you ] they're if sensitive shop read happens shopping Sam's -- bit depending the up. more are be you XX-Q, on And those know sensitive. to we I Well, I price different, the demographic through a little go likely think, when much when [ it's

as demographics had we And like we in last it's couple seen last kind inflationary calls, you very year, of I of peel different When well. onion, -- back our But at factors the so you said that. like different. the look

not short-term there's position. that's exactly to a I'm surprised we're more why in long-term the get shopping. we why the growth, And what this so pain been and and for And sitting lot did is of out key rate. that ahead It's that's

So we're to have continue to -- stable rates. try to going have

to claims of they and service the great ahead from also, stay products that I Just have reason our all think I the that go from customers able are then And service, they have a give severity see like want from and great said, We to to And a CRM. when trends can stay. Progressive. there. have

Next question of David from Evercore. comes Motemaden the line

ever were was seen up it in flat. apps you've amount had or and the you ever we've spend Tricia, highest was the mentioned but ad March, seen,

it versus I had are of feels there thinking X you're some sure today like -- much how the throughout of months actions limiting rolling ago? And So non-rate the country way non-rate conversion. about lag Is but of how actions the there, there's those that in still any the to know back size I'm place rest some year?

a question. of Yes, growth things other in David, XXXX. to quarter that's one have the you is in great extraordinary our compare X And

So We that lot. a that to growing is as well. as we a But to really comparison the be really want margin off were wanted. is we be because comparison because going didn't hard growing have didn't much we that

the that's factor. So first

have -- We pulled our actions. lot back and there's a of levers of non-rate

pre proof binding bunch different of we do. things there's a of there's that plans, there's build sort of So garaging,

ones. different several there's So

Some XX%? But -- what would wise, pulled we say, we're we that that yet. haven't more some need you back From XX% we don't a have we're states on Pat, back There are percentage because we say fully. where hardly and pulled the or all quickly I working diligently. would pretty rate at

remainder have about plan of, Yes. throughout bill we it a I depends the as states to verification would pre side, level, is run probably the down, still of year. we would have But say, or actions have have unwind as we the say, lots non-rate I right? close side, XX% really which on media are still it that we off, place. both we on good if you have significant back our the pullback. in We at to of off, media channels room the we indication broke those across state getting And verification where

rate, some places more Yes. I the month to last the of of just even much during where March, we're feel the I starting needed like some weeks or like in we've conversations. And of in have couple feel productive

would I Yes. agree.

we On that earned we're the to getting year regulatory states. a expect of them -- more recent side, couple we've be our more there's more our approvals, be of in had margins of more in calendar comfortable premium and on to certainly -- and continue

product general because So open more write managers should adequately. gives that our that volume greater priced they and think we're and we confidence managers up

David. Thanks,

That's great. And hear. the about of Robinsons conversion you to channel. first It you're Could attracting Robinsons retention agency whether talk conversion like you're you're Robinsons Robinsons sounded improvement digits any encouraging almost and the also then quarter. that achieving on just good in see on double increased as and the follow-up seeing up this really the helpful. No, apps That's how in to maybe question, new for it my was increased well? how

Yes.

I it's think agency's it direct if the thinking from the you're channel about the versus on channel. agency channel different

have the compensated We for bundle, platinum and that. to our preferred be continue no, and agents want they can agents, our we

is so channel. And the that part big agency of a

On the channel. direct

in. have if working group our really work where Progressive stable to a great Progressive saw I is be and with on been unaffiliated to And having partners they've it we of to to HomeQuote place And able about even our we Explorer, to not know paper think last -- paper. that with continuing we're through Home, We mix. We diligently come coverage went we album for be some when Home. [ not we think how have quarter, sort evolving ] with an and what of they that in good companies we on on that's customers our able write

continue it's say more the on, we standing the John they to to come John, and I proven especially do. they on, IR that to this, have might market, do as you call, think I the years when we'll that, Robinsons And call say, something ago, stable. that's think I company you we now to saying us. I here remember, we're we working be remember, So work want and be at diligently Yes, that they up remember an

we're insurer closer just destination getting And so destination being to closer company. and not a a but

So going when going you umbrella. and home, you or auto want you're but you're to come to a want -- possibly Robinson, you're

to going other want some You're things.

much at don't retention. those. Robinsons our if each the so segments, But added overall retention it's share versus And increases look product We other the higher. of you

with ] of question the Hummer next The comes from [ line (sic) Jimmy JPMorgan. Bhullar

ratio lower ratio. especially then years, case, sort we bottom that lower nondiscretionary form gets up last expense years? pricing on given Should a and growth we up should that And assume of show question potentially? non-acquisition should fall had be combined deal better going should it competitive forward? ratio if few use how the let would the I the and a that be is premiums Or competed expenses first, the be structurally next in expense that more your the on to much to the Or So the for the or the assume have away? of will just -- several it you line gone assume

Probably Jimmy. Yes. Good bit a little question, of both.

up and when investments cycle and to to to culture a people, that to But don't we'll we equates about So is to we on cost though, yes, to equates because be growth. we're and lowest can growth years because unit I the is to I this that the investments more just expenses able can of reason stable utilize continue across push that growth. made to think board continue be people we've be the where it, and growth. think to too, great this to lot do that of on technology, to expenses need past think And need a going processes, and and we prices spend is be our down growth, make on We want many there. severity become than we go we're efficient. the We're the on on necessarily low in over a maximize have especially you've And that course, try trends But overall seen less going efficient. to of years to having cost. to those unit competitive the because the because important, as

So bit of both. that I be would little able expect to do we'll a

ratio, least so I'd have on past that our and just non-acquisition at doing to we we've continued progress make been the add expense over decade.

we that efficiencies our at the level. tailwind plow increase denominator the always say, business, XX but premium, only into we for structurally, So, as ratio as But you average we combined will sure. a price is the company not

we're So into that same the to time. we over the extent going target growth and to margin pay get back efficiencies,

in And by are that process Overall, competitor seems state. the its vary margins. companies I'm at book, talk adequate several the still if and trends it And you few is every other just of you could environment there about company assuming are almost states competitive then like maybe repricing a beside behavior. where but

underwriting too So prices? were are good even in you you the in allowing seeing and a And maybe markets? are in and raise loose have are early those price competition companies companies loss some pricing be pick up Or where in terms to of areas been disciplined trends little companies being seeing bit states overall?

we what are as like continue It's far that I and to that we hard doing. still a of seeing say market. growth, to our We're other to curve ahead And with got can that. we like hard feel feel pricing. the as it's see I hope companies say

good. if follow, do, margins which you you sure think competition, I look the I'm

Again, set a saw an and And have like growth whole more quickly, begets non-rate diving I sort doing I terms year last if is of then edge when juncture, the actions talked you certain November at in everyone -- you in advantage, now put pulling so we the saw We trends back starting reacted. feel toe the and we have we you in. and like everybody -- and about things sort what wasn't water put we're think it time that of we where else this pool, of our and of like advantage period I react to about as think there. of some about and foot of and kind in our some quite

to it. and -- ]. each segmentation naming. our rust in model were And and our are not this feel markets, other match about of And just wait much up. ebb constant, see how creative we is okay, and X.X, in about an very think with ahead really X.XX People out It's soft got works. That's so whatever, we've flow great okay, that they don't with enough the our and variables So I and ability to of I one rate and ability put will to and We getting grow. XX different important. say, industry. our to stress and matters. we'll interactions markets, risk [ hard we it's can't ever catch again, for is, And years But the say, line bottom how

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Meyer KBW. with comes of question next from Sheilds the The line

lines, different translate why count look was pickup in slowdown I could And hoping that direct, growth Great. is we're actually -- March, you sort going could you what personal sequential policy a of at When saw like hoping we sorry, we in year-over-year agency. on in modest but seeing was I trends? in

Yes.

if you agency March in -- flat. think was think more I I

bit started -- be Pat, just to in little little where agency. bit I to think be -- than -- it's you'll I will more see that. a a that if add of return think recall, bit a it a trend more bit different little media I whereas direct, the you to the we little put on have agents access one model. spend, a But started delayed March can

Yes.

our up open rates in a rate So point. the more opening more slower drive those adequacy across things up confident in the that back of know board, potentially agency non-rate and rate returning actions which, more that to channel. But channel raters specifically into our been agency And as comparative growth. like we're and the this position at we we competitive some in in on are thus, are leaning we've put things

agency top-of-funnel fewer have channel. mid-funnel. levers in the It's We more

see decide effect of adequate. we rate media, the more funnel and when, will fill the responsibly we that much channel we're So you can the top delayed on direct quickly when

to response comments policies would That's earlier, to Perfect. commercial And in make sense X-month have it helpful. very more lines? Okay. your

that think that you We've and complex it's say what gathering I an would some really marketing it's convert, get When there BMT. on and quote talked very And a for easy to the tiers dependent you're business not process. time-consuming. about in I are information, and years. And ultimately go are

that want don't do X to months. every You

and things do So be right credits. to and with To the right those, like things have to more debits you ability just quickly. get priced have

but was of I and think excited the We more over. super have and about continue [indiscernible] lot flexible. excited, about commercial. I in many, -- we from brought had past. many have first could I been could BMTs developed IR that. and that thinking glad develop. and XX and in, lodging so like the be policies. earn it, position. we you your of were adjacent some it's think commercial first about front call concept about know to do And this out that understand Horizon and team things a important points on That team organization. said, of we the year wanted super X, is writer. lines we feel in the we year. are I part to really we we X the came did have getting Lines They one When with we're XX-month I'm in But going that hadn't within But ago, mostly Again, this big key McKinsey, the that. after Karen that that in because years think horizon in the a rest growing of might to up develop #X already took a or developed I'm I'm especially of maybe we those commercial or commercial. the And the company. in the the calendar is really Horizon were they I still to talk Commercial great to We how products And in of

business of that small think the over you years. if So last X has tripled fleets,

have several customers for recently we've the is weeks, app now, doubled. which think new business last take ProView, has volume rate Florida, BOP the on private side. ] on the passenger, highs. in we're about And XX You commercial I've the been insurance, in that the And also talking files snapshot right our importantly, saw states. contractor, or in business product side The seeing new have now we new the for usage-based auto model I all-time [ auto as contractor just

what of do on that those conversion, opportunity levers variety X is really we'll line we'll that does an organization. What of the excited of what to the growth Commercial at months, have and the about look So a such and to different your mean more does cetera. products retention? because in et to And there types is see, mean

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The next the Ward question comes Mike from with line of Citi.

was adoption Telematics. down, I I XX% noticed was agency. think, We in wondering about

segmentations hoping you said is? specific Telematics of understand the adopters you as customer to could bigger more certain it. Is because help Robinson mix just think that of just why us agencies, or of I Maybe aren't geographies?

was a started Mark, that national mostly maybe account around Yes. mid-XXXX. That of agencies. big couple happening

We're into. So still nothing read to excited. really much

really take fact, prepandemic. since up agency In and peaked has rate

continue to we big a so part our And model. of that's believe

driven. miles billion XX have We

data, a So trips. billion lot X have we of

talking that to big agents we have part get a it. the those that great discounts. to to be we're constantly importance of about drivers, continue great of And So

high accident last into We've ticked seen Okay. And loss frequency single digits on then down consecutive maybe quarters. just X recent experience.

wondering seeing Just more what driving your are or winter? Is you what's And view could on if you I guess recently? maybe that? share mild And mix? it

X are of those the sure. And good. for that's variables Yes,

we seen mile-to-mile of sort our actions. House helped ]. quarter our the actually, underwriting And billing of a business, mix have So [ XX self-imposed from tailwind

look that quarter probably this of instead XX the sure. would at those factors. would be for would in I factors be, What some those over the prior frequency So on quarter, because were trailing the of focusing I at look would X contributing

from question Meredith next comes UBS. The Brian of

Just think following benefit changes raising or the just customers I'm curious, the up on deductibles all is frequency terms and causing in anything frequency now. do you or maybe questions. conditions of right

now? kind seen we've right think in cycles of like I prior we're that in

versus fault no bit. discern up from regional frequencies hard work exact to that. going to of pinpoint We've be things hard to so none. frequency. differences state those of pinpoint We're playing It's been and terms that. a It's to on Mark to There could But really be really continue it hard brought in that. it maybe little is around -- a there could and little bit

underwriting we're that difference, before, seeing are from and first parts least some I Florida what changes weather really, some what said better is then at in mix sense which the House makes quantify. and bill. we restrictions, So self-imposed our Those really some the quarter can that

Right.

So it you're basically? for not pricing

we severity, and at look frequency for see but frequency. predict it know it. when We can't We we and we price

an would the my you it curious, have package thinking that in E&S homeowners. commercial from do about second And business then and area getting business, smart And more full and talk Great. other bit, into you question, the the get a you obviously, just have little Can into side? you we the capabilities? or are be

the didn't I'm broke question. out you really completely sorry, We understand there. but

Sorry, hear now? can me you

perfect. Yes,

have more or regulatory there? and line of surplus or and commercial capabilities. excess in maybe to E&S risk landscape homeowners capabilities I was given those about asking out the some plans just

an way commercial do arise. are get Yes, some and think in rate should opportunity capabilities an those at market, understand look admitted that already. we about and always all can't need the ability We to the we we E&S have. have best if that utilize to the we actually things in the to we the time in of kind venues And

comes question next The from Jefferies. Yaron Kinar with

Robinsons. we couple the also Wanted can. And a the shifts greater think with lead exposure in price greater line the if impact, we remain how severity that weighting and them of in with the ultimately a injury, Robinsons you of start you. mix to be? start so, keep maybe potential targets where Would bodily profit address to or then And I that where want trends higher? to with bit do you for if Thank

a going a every channel if to higher was every lifetime the have customer, if different limit We Yes. knowing to or like you're XX you're priced that saying, limits. John state difference preferred

and that that. and for So are we clear on very for price reserved --

sauce And as sort of that's so secret well. our

commercial. then to Okay. if we And switch

has the has I also those? had I you see because of you severity So and historically, in commercial commercial been auto But a trends been auto. of do, in the a to seen orientation. obviously, trucking in if lot the the severity your had lot has book do small you able a think I I now post TNC managing overall And growth but are how this, the different acquisition past? that look at have the And with to that they that the that business, industry protective company in avoid than with the segmentation, Progressive, been guess, think underwriting pressures and

get for variety the state-by-state, few I those price exposure side until or and lot actually said, very are commercial differently, differently was differently is of actions. a restrictions now doing businesses and on and terms can PL I business volatile, very Karen's and mean I a that need states much segmentation prices much commercial have react very perspective. more our treat to of of the all outlining like we mean them non-rate BMTs, when is But -- we I I we think, the the of we and has but Pat they like in

We that. with to and our able TNC. a partners get increase mentioned there, huge You needed one we're of

level comfort good We TNC organizations the in our about now. of that. But is different. So feel is success exposure yes, very high the

to have perspective top from a of just it You from stay pricing and claims on perspective. a

questions. queue be asked appear the already those who've Those in to

the in e-mail left So direct phone call Tia, can hand I event. Those to or back me the will your via directly you line. questions direct to queue closing over for our that my scripts. concludes

That next event of website for concludes the the a will Progressive section Investor the year. Quarter Corporation's Progressive's about Information be of event. replay Investor the available on First Relations