The Progressive Corporation (PGR) 6 Aug 242024 Q2 Earnings call transcript

Good morning, and thank you for joining us today for Progressive Second Quarter Investor Event. I'm Dough Constantine, Director of Investor Relations, and I will be a 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.

This quarter includes a presentation on a specific portion of our business, followed by a question-and-answer session with members of our leadership team. The introductory comments and the presentation were previously recorded. Upon completion of the previously recorded remarks, we will use the balance of the 90 minutes scheduled for this event for live questions and answers with the leaders featured in our recorded remarks as well as other members of our management team.

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

Additional XXXX, uncertainties available as the our reports annual risks supplemented in the year first and XX-K for quarters on by Form for those of and ended information our concerning is report December XXXX. second XX, XX-Q

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

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question of the comes Phillips line next Mike Our from of Oppenheimer.

that of pretty overall younger relative market? changing, like landscape What going think online, step may take see more you question, do the in for to that down change, consumer I the maybe whether I years direct. the clearly media, to be back of small social agency little X, seeing to as ask overall is about generation, level, are DTC more how guess more the the some more you I try think you big first do at competitors this, -- it's road? cut to part that's things to yours that's continues higher we're I a size guess trying into a how traditional looking to switch the that. personal [indiscernible]. the even over clearly And percent that entrants XX or of competitors channel

quite can difficult have for successful on that into so given been is get guys market, comment how you to if you you think this decades? And

remember more I X when we wants was called online, Yes. it everyone prog.com, auto makes that insurance one is I I we started expensive think an buy was it made money. It's easy. to the shared years I battle, mean we children online, I before would made before, think difficult. XX that And I've have an and it thought called you uphill a battle. generation, else -- ever with was it's us that sense. something It And AutoPro. anyone bet. No buy took first

back was Dave InsurTech a said, As coined it ever if at you before into presentation, Krew were we go what in you name. look this that

feel think in our so we're continue DNA. going So That's I we pretty to proud innovate. to important that

to with the So we're integrated continue going marketing campaigns.

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specific more little a recent is to This Okay. Q. your

lot You where opportunities that's little part growth that growth mentioned base come And things effort in that growth that? the make about in And in anything that guess more caused And in your curious, renters from that concerted bit your auto renters? renters. coming growth I'm auto you on are there there I a a from? are the is profitable. Or there that can would customer is learn

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line comes next the question Gregory of of Raymond Our Peters James. from

How are portion And question, presentation, your so growth I staffing back substantial during base and speed happened? challenge you're up aren't specific your the So geographies what to to to so this I for tight and on mentioned I'm that dialed has the a going many of a of growth that. you your first maybe geographies questions has think on -- Jay, in staffing times Jay's been certain Has guess some strategies a the just market? when advertising about you labor around focus where broader of there hiring comment. presumably just there in been times this reporting some offset

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

and really the how do buy to a big get maybe he apply that I then was big auto that homeowners. that, direct-to-consumer said the that but And wondering cusp think a what -- of be all can insurance that you course, was of Tricia, you think And people was that listening you of advertising. online, I want online, course, in homeowners you. Jay's would online people said they the industry the you doubted market presentation there change? and catalyst catalyst did. think to homeowners' bet followed buy people that you change made to I When we're do will do and on

go I'll questions. -- a That's several begin to Yes. back with.

in continue think to to grow all channels. I we'll try always

that use So we'll innovation.

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business direct side, about direct comes of we're side. on homeowner So XX% think into about the our I the --

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then And little a and rate looking more on homeowners. the

of your increases yours, If rate you look much than that of competitors their provide at higher pricing data, are in some course. renewal

industry your be Is your states, your be you're due But seem to being Some geography. causing to are which too in to related that in still, is of priced think the is action growing take homeowners industry what others with for to nationally non-coastal faster overpricing to lower. Is for but non-cat creating some numbers adequately numbers get current lower take to here? pricing to Progressive diversification need here also not general. share Progressive, Progressive the you much, opportunity does an do Or doing?

talked average -- And X% those looking XX% at, smaller in about you're our a be really about XX%. growth rates written trailing Well, is much of renters, took premium. that quarter. XX, we in it We like some will on about the of about which some year-to-date,

taken had rate, we've non-rate of that of So we've derisk books. quite and our to taken we've a other actions a lot lot

focus what things going on to doing we're I think first, we've the de-risking said. first book,

Florida options worked those unprofitable. We nonrenewals improved segmentation. going knew continue consumers. with work we for have to the have in on for Florida XXX,XXX We that us to to were We're

X.X time. that and takes We be our product. and as our We've auto, have going in even segmentation in as pricing diligently surgical have on really working states said and on good Get letter, more been my we're it. level we at at our I new some X aggressive. that to

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from of comes the line of question Robert next Sachs. Our Goldman Cox

continued I'm competition improve sale cost on And year? how the per will just peers of half election costs the have you question First cost to back as anticipate you increased year-to-date. advertising? impact also per sale. in the curious, margins just for the their Are curious expecting on

have answer I idea. Yes. no To last part, the

efficiency. sale, the pressure so good TAC some feel might is that about we per part, but feel below we much on cost first The really it

or weather-related maybe And Okay. frequency impacting are it. you accident just sustainable of forward, other about Got mix going versus shift of nonrecurring think going much considering favorable this as pricing how some the When to you frequency. environment business XX-Q, benefits? the

Yes.

now at X majority frequency of of about preferred actions. exactly. say I X%, down non-rate the to us our would So the our if really hard right you and always that -- being for factors is some is it's discern mix the look --

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from Meyer KBW. comes Our of next the line question of Shields

states. Gina X mentioned some cut rates for It's for you rate ] [ on the taking small question Meyer. in letter, shareholder on the first My is

on how your And thinking curious think what about Just it? should rates forward? going behind we

Yes.

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on Got is conversion second it. question the rate. My

is in thinking down rate Conversion Progressive expanding from come to has So competitors. significantly mentioned, schedule the presentation, more you about dealing with rate? than the due your conversion How behavior. shopping

Yes.

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line of next the question JPMorgan. Our of comes from Jimmy Bhullar

haven't could as questions the but on seeing my spend most raising were wondering competitor and just you the So you're like of seems prices, seeing? what and the varies various marketing answered, and proactive what talk been about of pricing how talk wondering behavior I in mutuals but it it channels if terms because group could as you're in about was you channel by if

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have of margins your pretty most quarters, margins several improving but then And obviously the as last are well. your for good peers' been

quarters, an in environment an just see you eroded they a prices earning you're few profit since on see where get have the if wondering or lot a to because gone on pushback uptick in regulatory you of prices? composition So start up excess

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comes question Michael Ward of Citi. line next from Our the of

At be wondering, that noticed for in up mobile your tick relative least just app to auto policies was seems high your I we competitors. general. pretty to

telematics, use as insight paperless wondering doesn't and are incentivizing be. you So just maybe it or is cards to but the else? any seem It might ID -- it's digital if that you just have of why something like

sort that think the question I the with in of technology. of of terms evolution

likelihood I there. have So of in stay And our come mobile. a we new to lot want apps in, is you if come you through think

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continued, that to people our think right you're and and way. I it's investments do want think in it's based I So on that that business

wins phone. are more on sales. I home or indirect, Okay. growth just how then the trying your comments those about in context And expanding Robinson think share we And more the going Wondering kind direct you on forward? taking acceleration guess, elaborate of square over customer expansion Robinson of about Robinson should in the that can to the place X. if online

across group Yes. because to agency Well, would many, call write agent those access board. many another a what years Explorer give to say on be have needed carrier channel. it we homeowners so could our stable to in that's us the would place Robinson where auto is, independent taking another risk, really addition growth is I able we product to in What HomeQuote we a I higher carriers want say, to it customers based the of we And to a if really the where or didn't having carrier. started we ago. was in

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that the deal, else seal with come us. sell deal they to who we somebody help the wants can't we if them wouldn't why risk. So And

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ISI. of Our next David the question line comes Evercore from Motemaden of

from when spend. highest Tricia, start could between -- the spend June a spend in your if a higher up. that obviously about come and to like ramp in lag ad hit talk of was you see that it ad was tick history when March PIF increased I'm how lag so of happened the you sort second much when wondering lag just another also between through? quarter to as was I there there see and or wondering looks when you is well if I and sales? month you there just you Is any ad know the there start the in where that

there's we'll of the into prospects the coming that in. pretty of -- lag. course, a any media have our I little would closely of I prospects but And lag, mean say terms there's a then, turn little we spend we sales. measure then measure bit that in when

totally advertising. closed in were we also We our -- never

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So about you're specifically overall? talking or auto

Yes, auto.

Yes.

years. the so over we've On auto, much the rates taken

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Tunis Our line next Autonomous. of of question comes from the Ryan

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want Now point. it's a moot to I don't say

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of BMO. the Our of comes from last Zaremski question Michael line

some that sustainability couple I and he follow-up frequency unpacked What are relative the of any asked especially of can easy looks about very on kind question, or on severity of had you I thinking also comps, mix side? your factors say First -- to severity non-rate on favorable, a you sustainability of you severity know I are the a Rob actions. as to of mix I your favorable, know peer guess, Cox trends how about last items year. data. guess, the these days? and the But you about

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it. Got

rate in nothing sustained that running should mix So out of it your you're make the on past, calling has -- kind more okay? at a lower than it

mostly stable to getting a place. No, more just Yes. hopefully

my part many when And just Investor Okay. audience as much follow-up at look these is phone, ago plus at Day smartphones. times I days. probably -- think And in our way, the being I I too Jay's -- you my about remember the asked way my think and on the always by phone your just was we at how And presentation of the our you at look all direct-to-consumer. on a lastly, we live decade I that Ohio, look

if improving you you I of it the back like so were even But a time in but more you're been than you something there frame, -- that the XXXX that worth on spend more a So the ahead for know improved mentioned seems of catalyst feel that's if trend. kind Or you was mentioned I in a just believe. guess, data guys 'XX you don't mentioned today -- -- a that. your and was to elaborating Jay I there's past? big -- that

-- was a there's kind that special happen of something curious I if So if then? was

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and said have incredible. The you I which group so asked me now, -- are is group would say the in this is XXXX, And more would I even same have if better. people would

are level what amazing. truly from learning is understanding a we just So granular are we and what

of think I sauces. that's one of secret many our

complained I -- hope against and this no additional never the make They've pulling is our to their to grow, we can nimbleness want spend So this hit much as up, up Jay we Dave as entire and and they do when to the grow about for spend never firm. back. teams sure target. their thank we've as incredible my And they to year say that can wrap

So our questions coming to you, great event. today. everyone thank I appreciate

been Appears to final have our question.

closing hand I'll you scripts. the event. to back call our Marvin, over So for that concludes

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