(Source: Associated Press/AP Online)
MAYFIELD VILLAGE, Ohio - Auto-insurance provider Progressive Corp. said Tuesday its July income jumped 40 percent, as it reversed investment losses and settled certain cases for less than it had set aside to cover them.
The company said net income rose to $114.9 million, or 17 cents per share, compared with $81.8 million, or 12 cents per share, in July 2008.
Net premiums written slipped 1 percent to $1.37 billion, from $1.38 billion in the same month last year. Net premiums earned, or the portion of premiums an insurance company earns when polices expire, edged up to $1.33 billion, from $1.31 billion last year.
Progressive said it saw a $37.3 million benefit from claims that settled for less than it had set aside to cover them in the past year.
It posted $25.8 million in net realized gains on securities, or investments, compared with a loss of $16.1 million in July 2008.
The company's combined ratio improved to 91 from 92.8. Combined ratio measures the sum of an insurance company's losses, or money paid out in claims, and expenses. A ratio above 100 means that for every premium dollar taken in, more than a dollar was spent covering claims, expenses and commissions, while a ratio under 100 indicates an underwriting profit.
Progressive said it had 10,905 personal policies and 530 commercial policies in force in July. In the same month last year, it had 10,521 personal policies and 557 commercial policies in force.
In morning trading, Progressive shares gained 59 cents, or 3.7 percent, to $16.39, as the broader market rallied. Shares have changed hands between $9.76 and $20 in the past 52 weeks.
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