The Progressive Corporation saw a 56% year-over-year drop in net income during the second quarter (Q2) of 2021, despite enjoying double-digit increases in both net premiums written and net premiums earned for the three months ending June 30.
Progressive reported total net income in the quarter of $790.1 million, down from $1,790.4 million in the second quarter of 2020. Meanwhile, net premiums written jumped 13% from $10,140 million to $11,480.3 million, and net premiums earned increased by 14% from $9,648.6 million to $10,982.3 million. The insurer’s combined ratio also took a hit in the second quarter, slipping by 8.8 points to reach 96.5%, compared to 87.7% in the same period last year.
For the month of June 2021, Progressive reported total net income of $132.8 million, marking a 72% drop from the $470.9 million it secured in June 2020. Net premiums written in June was $3,627.3 million, up 13% from June 2020, and net premiums earned was $3,459.9 million, up 14%. In June 2021, the insurer’s combined ratio took a 13.6-point hit, reaching 100.5%, compared to 86.0% in June last year.
Progressive provides insurance for personal and commercial autos and trucks, motorcycles, boats, recreational vehicles, and homes. It is the third largest auto insurer in the country, a leading seller of motorcycle and commercial auto insurance, and one of the top 15 homeowners’ insurance carriers.
For the three months ending June 30, 2021, Progressive’s personal auto incurred accident frequency increased on a calendar-year basis by 47%, and severity went up 8% compared to the same period last year, excluding comprehensive coverage.
Despite a few challenging months, Progressive confirmed: “Consistent with our financial objectives, we are taking actions to support our long-standing goal of achieving a calendar year combined ratio of 96% or better.”