Report of the Examination of
Progressive Universal Insurance Company
Cleveland, Ohio
As of December 31, 2022
TABLE OF CONTENTS
Page
I. INTRODUCTION .................................................................................................................. 2
II. HISTORY AND PLAN OF OPERATION ............................................................................... 4
III. MANAGEMENT AND CONTROL ......................................................................................... 6
IV. AFFILIATED COMPANIES ................................................................................................... 8
V. REINSURANCE .................................................................................................................. 12
VI. FINANCIAL DATA ............................................................................................................... 14
VII. SUMMARY OF EXAMINATION RESULTS ........................................................................ 22
VIII. CONCLUSION .................................................................................................................... 23
IX. ACKNOWLEDGMENT ........................................................................................................ 24
Tony Evers, Governor of Wisconsin
Nathan Houdek, Commissioner of Insurance
125 South Webster Street, P.O. Box 7873 | Madison, WI 53707-7873
p: 608-266-3585 | 1-800-236-8517 | f: 608-264-6237
ocifinancial@wisconsin.gov | oci.wi.gov
April 26, 2024
Honorable Nathan D. Houdek
Commissioner of Insurance
State of Wisconsin
125 South Webster Street
Madison, Wisconsin 53703
Commissioner:
In accordance with your instructions, a compliance examination has been made of the affairs
and financial condition of:
PROGRESSIVE UNIVERSAL INSURANCE COMPANY
Cleveland, Ohio
and this report is respectfully submitted.
2
P&CBLK_02-19.dotm
I. INTRODUCTION
The previous examination of Progressive Universal Insurance Company (Progressive
Universal or the company) was conducted in 2018 as of December 31, 2017. The current
examination covered the intervening period ending December 31, 2022, and included a review of
such subsequent transactions as deemed necessary to complete the examination.
The examination of the company was conducted concurrently with the examination of
The Progressive Group. The Ohio Department of Insurance acted in its capacity as the lead state
for the coordinated examinations. Work performed by the Ohio Department of Insurance was
reviewed and relied on where deemed appropriate.
The examination was conducted using a risk-focused approach in accordance with
the National Association of Insurance Commissioners (NAIC) Financial Condition Examiners
Handbook. This approach sets forth guidance for planning and performing the examination of an
insurance company to evaluate the financial condition, assess corporate governance, identify
current and prospective risks (including those that might materially affect the financial condition,
either currently or prospectively), and evaluate system controls and procedures used to mitigate
those risks.
All accounts and activities of the company were considered in accordance with the
risk-focused examination process. This may include assessing significant estimates made by
management and evaluating management’s compliance with statutory accounting principles,
annual statement instructions, and Wisconsin laws and regulations. The examination does not
attest to the fair presentation of the financial statements included herein. If during the course of
the examination an adjustment is identified, the impact of such adjustment will be documented
separately at the end of the “Financial Data” section in the area captioned "Reconciliation of
Surplus per Examination."
The company is annually audited by an independent public accounting firm as
prescribed by s. Ins 50.05, Wis. Adm. Code. An integral part of this compliance examination was
the review of the independent accountant's work papers. Based on the results of the review of
these work papers, alternative or additional examination steps deemed necessary for the
3
P&CBLK_02-19.dotm
completion of this examination were performed. The examination work papers contain
documentation concerning the alternative or additional examination steps performed during the
examination.
Actuarial Review by the Ohio Insurance Department
The company is a participant in a comprehensive reinsurance pooling agreement
with Progressive Direct Insurance Company and certain affiliates (referred to as the Direct Pool).
Accordingly, the company’s net loss and loss adjustment expense reserves are the product of the
reserves of the Direct Pool and the company’s participation percentage in the pool.
An actuary on the staff of the Ohio Department of Insurance reviewed the adequacy
of the company’s loss reserves and loss adjustment expense reserves, as a function of its
participation in the pool. The results of his work were reported to the examiner-in-charge.
4
P&CBLK_02-19.dotm
II. HISTORY AND PLAN OF OPERATION
The company was organized under Illinois law in 1992. Ownership of the company
was transferred to Progressive Direct Holdings, Inc., on January 1, 2004. Effective November 19,
2003, the company redomesticated to Ohio from Illinois. Effective December 21, 2004,
Progressive Universal redomesticated to Wisconsin from Ohio.
In 2022, the company wrote direct premium in the following states:
Illinois
$ 444,377,342
26.8%
Wisconsin
399,841,359
24.1
Oregon
338,795,046
20.4
Iowa
191,759,215
11.5
Nebraska
105,373,763
6.4
New Hampshire
93,034,857
5.6
All others
85,837,620
5.2
Total
$1,659,019,202
100.0%
The company is licensed in Hawaii, Illinois, Iowa, Maine, Nebraska, New Hampshire,
North Carolina, Ohio, Oregon, Virginia, Wisconsin, and Wyoming. The company is also a
qualified or accredited reinsurer in the state of New York.
The major products marketed by the company include private passenger auto
liability, auto physical damage, inland marine, and other liability–occurrence. The major products
are written directly by the company, through the internet, mobile devices, or over the phone.
The company does not have any employees or facilities. Management and
administrative services are provided to the company by affiliates, pursuant to services
agreements described in the “Affiliated Companies” section of this report. The company’s major
operations are conducted in Mayfield Village, Ohio (the corporate headquarters for The
Progressive Group). Additional support services are provided by Progressive Direct Insurance
Company’s personnel in a network of call centers and claim administration offices throughout the
United States.
5
P&CBLK_02-19.dotm
The following table is a summary of the net insurance premiums written by the
company in 2022. The growth of the company is discussed in the “Financial Data” section of this
report.
Line of Business
Direct
Premium
Reinsurance
Assumed
Net
Premium
Inland marine
$16,989,683
$6,826,574
$16,989,683
$6,826,574
Other liability – occurrence
6,029,633
2,035,364
6,029,633
2,035,364
Other liability – claims made
4,000
4,000
Private passenger auto no-
fault (personal injury)
35,902,823
57,136,403
35,902,823
57,136,403
Other private passenger
auto liability
889,342,993
371,949,805
889,342,993
371,949,805
Other commercial auto
liability
2,625,739
2,625,739
Private passenger auto
physical damage
710,754,069
254,515,151
710,754,069
254,515,151
Commercial auto physical
damage
660,620
660,620
Total All Lines
$1,659,019,202
$695,753,656
$1,659,019,202
$695,753,656
Progressive Universal participates in Progressive’s Direct Pool. The Direct Pool
consists of seven insurance companies that primarily write their business through the Direct (1-
800-PROGRESSIVE and Internet) channel. The Direct Pool writes private passenger automobile
insurance and other specialty insurance coverages and related services in the United States. In
addition, the Direct Pool writes some business that is generated through a general agency
agreement with Progressive Advantage Agency, Inc. The Direct Pool also writes commercial
automobile business through both the Agency channel and Direct channel that consists primarily
of liability and physical damage insurance for automobiles and trucks owned by small businesses,
with the majority of customers insuring three or fewer vehicles. The reinsurance pooling
agreement is further described in the section of this report titled “Reinsurance.”
6
P&CBLK_02-19.dotm
III. MANAGEMENT AND CONTROL
Board of Directors
The board of directors consists of five members. All directors are elected annually to
serve a one-year term. Officers are elected at the board's annual meeting. Members of the
company's board of directors may also be members of other boards of directors in the holding
company group. The board members currently receive no additional compensation for serving on
the board.
Currently, the board of directors consists of the following persons:
Name and Residence
Principal Occupation
Term
Expires
Patrick Kevin Callahan
Chardon, Ohio
Personal Lines President
The Progressive Group of Insurance
Companies
2024
Daniel Joseph Witalec
Orange Village, Ohio
General Manager Marketing Strategy & Intel
The Progressive Group of Insurance
Companies
2024
Michael Vincent Esposito
Aurora, Ohio
Auto Product Development Leader
The Progressive Group of Insurance
Companies
2024
Charlotte Marie Elek
Solon, Ohio
Business Leader Field Marketing
The Progressive Group of Insurance
Companies
2024
Meghan Louise McArdle Friesen
Highland Heights, Ohio
Personal Lines General Manager
The Progressive Group of Insurance
Companies
2024
Officers of the Company
The officers serving at the time of this examination are as follows:
Name
Office
Charlotte Marie Elek
President
Michael Robert Uth
Secretary
Daniel Joseph Witalec
Treasurer
Michael Vincent Esposito
Vice President
Carl Gordon Joyce
Vice President
Gregory Frank Mischlich
Assistant Secretary
Sandra Lee Rihvalsky
Assistant Treasurer
7
P&CBLK_02-19.dotm
Committees of the Board
The company's bylaws allow for the formation of certain committees by the board of
directors. The committees at the time of the examination are listed below:
Executive Committee
Investment Committee
Charlotte Marie Elek Chair
Charlotte Marie Elek, Chair
Daniel Joseph Witalec
Daniel Joseph Witalec
Meghan Louise McArdle Friesen
Meghan Louise McArdle Friesen
8
P&CBLK_02-19.dotm
IV. AFFILIATED COMPANIES
Progressive Universal is a member of an insurance holding company system under
TPC, the ultimate parent company of The Progressive Group. The Progressive Group is
organized into segments under separate holding companies, including a Commercial Lines
segment (under Progressive Commercial Holdings, Inc.), and a Personal Lines segment. The
Personal Lines segment is subdivided into two channels: a Direct Channel, which includes
business written directly through the Internet, mobile devices, or over the phone (organized under
Progressive Direct Holdings, Inc.), and an Agency Channel, which includes business written by a
network of over 40,000 independent agencies located throughout the U.S. (organized under
Progressive Agency Holdings, Inc.). Below is an abbreviated organizational chart which depicts
the organization of Progressive’s business segments, as well as the other Wisconsin-domiciled
insurers. A brief description of the significant affiliates follows the organizational chart.
Organizational Chart (Abbreviated)
As of December 31, 2022
The Progressive
Corporation
(NYSE: "PGR")
Progressive Direct
Holdings, Inc.
[Direct Pool]
Progressive Universal
Ins Co (WI)
Progressive
Commercial Holdings,
Inc. [Commercial Auto
Segment]
Artisan and Truckers
Casualty Co (WI)
Progressive Agency
Holdings, Inc.
[Agency Pool]
Progressive Northern
Ins Co. (WI)
Progressive Classic Ins.
Co. (WI)
ARX Holding Corp.
9
P&CBLK_02-19.dotm
The Progressive Corporation (TPC)
The Progressive Corporation is an Ohio-domiciled insurance holding company that
was formed in 1965. TPC became publicly traded after an initial public offering in 1971, and its
common stock is currently listed on the New York Stock Exchange (ticker symbol PGR). As of
December 31, 2022, the audited financial statements of TPC reported assets of $75,465 million,
liabilities of $59,574 million, and shareholders’ equity of $15,891 million. Operations for 2022
produced net income of $721.5 million.
Progressive Direct Holdings, Inc. (Direct Holdings)
Progressive Direct Holdings, Inc., is a Delaware-domiciled insurance holding
company formed in 2003. The company has virtually no expenses, and revenue is solely from
dividends from its subsidiaries and any gain/loss on the investments in subsidiaries.
Progressive Direct Insurance Company (Progressive Direct)
Progressive Direct Insurance Company, a property casualty insurer domiciled in
Ohio, provides administrative services through affiliated agreements discussed below. As of
December 31, 2022, the audited financial statements of Progressive Direct reported assets of
$14,084,884,818, liabilities of $9,778,020,190, and capital and surplus of $4,306,864,628.
Operations for 2022 produced net income of $640,850,707.
Agreements with Affiliates
In addition to common staffing and management control, various written agreements
affect Progressive Universal’s relationship with its affiliates. The pooling agreement is described
in the “Reinsurance” section of the report. A brief summary of the other agreements follows:
1. Type: Consolidated Tax Allocation Agreement
Parties: Progressive Universal along with other members of the Progressive holding
company system
Effective: August 1, 2005, Amended and restated as of June 1, 2021
Terms: The agreement establishes that an estimated consolidated tax liability will be
computed quarterly for The Progressive Corporation, with each member
company’s recoverable or payable equal to the amount that the member
company would have reported on a nonconsolidated basis. Settlements are to
be made within 90 days of each quarter in which The Progressive Corporation
is required to make a federal income tax estimated payment.
10
P&CBLK_02-19.dotm
2. Type: Cash Management Agreement
Parties: Progressive Universal, Progressive Casualty Insurance Company (Casualty)
and other Progressive affiliates
Effective: January 1, 1998
Terms: All cash receipts or disbursements attributable to Progressive Universal and
the other affiliates named in the agreement are deposited in or withdrawn from
a centralized account (Cashier Account) that is managed by Casualty.
Pursuant to the terms of the agreement, Progressive Universal has a balance
in this account that reflects its claim against or obligation to the Cashier
Account. Casualty provides the Company with monthly statements that show
the month-end balances. Account balances are considered loans and interest
is payable to or receivable from the Company’s account depending on the
balance. The provisions of an Interest Agreement to which Progressive
Universal is a party govern the rate of interest. Each participant to the
agreement receives a quarter-end balance that represents a net amount
against any other intercompany transaction. Settlements are to be in cash or
readily marketable securities valued at market value.
3. Type: Interest Agreement
Parties: Progressive Universal, Progressive Casualty Insurance Company, and other
Progressive affiliates
Effective: January 1, 1977
Terms: This agreement establishes the variable interest rate that governs each entity’s
participation in Casualty’s Cashier Account as noted in the Cash Management
Agreement in #2 above. Interest is to be computed at the prevailing 90-day
U.S. Treasury bill rate on the last day of each month rounded to the nearest
quarter of a percent.
4. Type: Investment Services Agreement
Parties: Progressive Universal along with other participating affiliates and Progressive
Capital Management Corp. (Progressive Capital). (Progressive Capital was
formerly known as PPLP Corporation, then Progressive Partners, Inc., until it
changed its name to that currently used on June 8, 1998.)
Effective: July 16, 1992, Amended and Restated as of March 1, 2023
Terms: Progressive Capital provides investment management services to members of
the Progressive holding company system named in the agreement. The
agreement requires each of the participating companies to reimburse
Progressive Capital for an equitable portion of the costs and expenses it incurs
in providing its services. Progressive Capital does not charge any additional
management fees to the participating companies.
5. Type: Joint Servicing (Cost Allocation) Agreement
Parties: Progressive Universal and Progressive Direct
Effective: July 1, 2007
11
P&CBLK_02-19.dotm
Terms: The Company provides Progressive Direct with underwriting and loss
adjustment services for specific business produced, and Progressive Direct
provides the Company with similar services for other specific business
provided. In exchange for these services, the companies charge management
fees based on each company’s use of the other’s services.
6. Type: General Agency Agreement
Parties: Progressive Universal and Progressive Advantage Agency, Inc. (Agency) and
other Progressive affiliates
Effective: December 1, 2006
Terms: Agency will act as participating companies’ respective general agent in the
states of California, Kentucky, Louisiana, Washington, and other such states
as the parties may agree upon.
12
P&CBLK_02-19.dotm
V. REINSURANCE
The company's reinsurance portfolio and strategy at the time of the examination are
described below. A list of the companies that have a significant amount of reinsurance in force at
the time of the examination follows. The contracts contained proper insolvency provisions.
Effective December 27, 2003, the company and seven of its affiliates participate in an
affiliated reinsurance pooling agreement (the Direct Pool), under which 100% of the underwriting
business of each member company, net of external reinsurance, is ceded to Progressive Direct.
The combined premiums, losses, and expenses are then retroceded to each Direct Pool member,
based on predetermined pooling percentages. The current pooling percentages, effective as of
January 1, 2019, are as follows:
Participation:
Progressive Direct Insurance Company 77.0%
Progressive Marathon Insurance Company 6.0
Progressive Max Insurance Company 6.0
Progressive Advanced Insurance Company 4.0
Progressive Universal Insurance Company 4.0
Progressive Premier Insurance Company of Illinois 2.0
Progressive Paloverde Insurance Company 0.5
Progressive Choice Insurance Company 0.5
Mountain Laurel Assurance Company 0.0
Total 100.0%
Nonaffiliated Ceding Contracts
1. Type: Umbrella Excess of Loss
Reinsurer: Employers Mutual Casualty Company 15%
Waypoint Underwriting Management LLC
On Behalf of Accident Fund Insurance Company
Of America 15%
Waypoint Underwriting Management LLC
On Behalf of Insurance Company of the West 15%
Swiss Re 55%
Scope: Reinsurance of the excess liability under the Personal Umbrella
Liability for coverages required for non-resident drivers under the
motor vehicle financial responsibility law or the motor vehicle
compulsory insurance law following the provisions of the
Company’s Policies when they include or are deemed to include
so-called “Out of State Insurance” provisions
13
P&CBLK_02-19.dotm
Retention: $1,000,000
Coverage: Each Loss Occurrence, Each Insured $4,000,000 in excess of
$1,000,000
Maximum Liability - $16,000,000
Premium: Premium Rate 5.75%
Deposit Premium $1,289,155
Minimum Premium (80%) $1,031,324
Effective date: January 1, 2022, through January 1, 2023
Termination: The Company may terminate the share of the Reinsurer at any
time, either during the term or after the expiration of this
Contract, by giving written notice to the Reinsurer in the event
the Reinsurer experiences one or more Special Termination
Event(s). The effective date of termination shall be the date
selected by the Company, which may be a date that is
retroactively applied up to a maximum of 90 days prior to the
earliest of either the date of public announcement or the date of
discovery, as applicable, of the Reinsurer experiencing one or
more Special Termination Event(s), subject to the condition that
such selected date must be the last day of a calendar month.
The company has an Allocation Agreement (Umbrella XOL) with several affiliates and
Waypoint Underwriting Management LLC for and on behalf of Insurance Company of the West,
with respect to the Umbrella Excess of Loss Reinsurance Contract, for the period January 1, 2021,
to January 1, 2022, and any renewals thereof. The Umbrella XOL Contract applies for any liability
exceeding $16,000,000 for all losses occurring during any term of the Umbrella XOL Contract.
Each party to the contract is responsible for a portion of that excess liability.
14
P&CBLK_02-19.dotm
VI. FINANCIAL DATA
The following financial statements reflect the financial condition of the company as
reported to the commissioner of insurance in the December 31, 2022, annual statement.
Adjustments made as a result of the examination are noted at the end of this section in the area
captioned "Reconciliation of Surplus per Examination." Also included in this section are
schedules that reflect the growth of the company and the compulsory and security surplus
calculation.
15
P&CBLK_02-19.dotm
Progressive Universal Insurance Company
Assets
As of December 31, 2022
Net
Nonadmitted
Admitted
Assets
Assets
Assets
Bonds
$396,941,213
$
$396,941,213
Cash, cash equivalents, and short-term
investments
11,396,318
11,396,318
Receivable for securities
2,337,937
2,337,937
Securities lending reinvested collateral
assets
Investment income due and accrued
2,085,541
2,085,541
Premiums and considerations:
Uncollected premiums and agents'
balances in course of collection
44,804,711
7,634,431
37,170,280
Deferred premiums, agents' balances,
and installments booked but
deferred and not yet due
256,500,450
256,500,450
Reinsurance:
Amounts recoverable from reinsurers
12,129,699
12,129,699
Net deferred tax asset
12,643,138
46,021
12,597,117
Receivables from parent, subsidiaries,
and affiliates
80,395,688
80,395,688
Write-ins for other than invested assets:
State unearned surcharge recoverable
108,916
108,916
VA uninsured motorist refund
38,881
38,881
Prepaid expenses
137,222
137,222
0
Overflow pages
7,688
7,688
0
Total Assets
$819,527,402
$7,825,362
$811,702,040
16
P&CBLK_02-19.dotm
Progressive Universal Insurance Company
Liabilities, Surplus, and Other Funds
As of December 31, 2022
Losses
$230,090,249
Reinsurance payable on paid loss and loss adjustment
expenses
3,199,585
Loss adjustment expenses
50,490,700
Commissions payable, contingent commissions, and other
similar charges
225,328
Other expenses (excluding taxes, licenses, and fees)
236,507
Taxes, licenses, and fees (excluding federal and foreign
income taxes)
6,249,060
Current federal and foreign income taxes
3,333,904
Net deferred tax liability
Unearned premiums
189,319,622
Advance premium
7,255,469
Ceded reinsurance premiums payable (net of ceding
commissions)
832,957
Drafts outstanding
58,706,635
Write-ins for liabilities:
State Plan Liability
2,383,125
Escheatable Property
531,002
Miscellaneous Other Liabilities
174,238
Total Liabilities
$553,028,381
Common capital stock
$ 2,502,500
Gross paid in and contributed surplus
46,818,551
Unassigned funds (surplus)
209,352,608
Surplus as Regards Policyholders
258,673,659
Total Liabilities and Surplus
$811,702,040
17
P&CBLK_02-19.dotm
Progressive Universal Insurance Company
Summary of Operations
For the Year 2022
Underwriting Income
Premiums earned
$671,332,498
Deductions:
Losses incurred
$463,389,822
Loss adjustment expenses incurred
65,143,747
Other underwriting expenses incurred
124,167,298
Total underwriting deductions
652,700,867
Net underwriting gain (loss)
18,631,631
Investment Income
Net investment income earned
7,445,155
Net realized capital gains (losses)
(1,167,726)
Net investment gain (loss)
6,277,429
Other Income
Net gain (loss) from agents' or premium balances charged
off
(11,894,027)
Finance and service charges not included in premiums
26,227,094
Write-ins for miscellaneous income:
Interest Income of Intercompany Balances
2,526,879
Miscellaneous Other Income
158,370
Total other income
17,018,316
Net income (loss) after dividends to policyholders but before
federal and foreign income taxes
41,927,376
Federal and foreign income taxes incurred
10,427,786
Net Income (Loss)
$ 31,499,590
18
P&CBLK_02-19.dotm
Progressive Universal Insurance Company
Cash Flow
For the Year 2022
Premiums collected net of
reinsurance
$648,676,302
Net investment income
7,700,761
Miscellaneous income
18,294,841
Total
674,671,904
Benefit- and loss-related
payments
$444,409,144
Commissions, expenses paid,
and aggregate write-ins for
deductions
188,019,036
Federal and foreign income
taxes paid (recovered)
8,298,340
Total deductions
640,726,520
Net cash from operations
33,945,384
Proceeds from investments sold,
matured, or repaid:
Bonds
$164,873,774
Total investment proceeds
164,873,774
Cost of investments acquired
(long-term only):
Bonds
167,917,495
Miscellaneous applications
2,337,937
Total investments acquired
170,255,432
Net cash from investments
(5,381,658)
Cash from financing and
miscellaneous sources:
Dividends to stockholders
4,700,000
Other cash provided (applied)
(12,467,408)
Net cash from financing and
miscellaneous sources
(17,167,408)
Net Change in Cash, Cash
Equivalents, and Short-Term
Investments
11,396,318
Cash, cash equivalents, and
short-term investments:
Beginning of year
End of Year
$ 11,396,318
19
P&CBLK_02-19.dotm
Progressive Universal Insurance Company
Compulsory and Security Surplus Calculation
December 31, 2022
Assets
$811,702,040
Less liabilities
553,028,381
Adjusted surplus
258,673,659
Annual premium:
Lines other than accident and health
$695,753,656
Factor
20%
Compulsory surplus (subject to a minimum of $2 million)
139,150,731
Compulsory Surplus Excess (Deficit)
$119,522,928
Adjusted surplus (from above)
258,673,659
Security surplus (140% of compulsory surplus, factor
reduced 1% for each $33 million in premium written in
excess of $10 million, with a minimum factor of 110%)
166,980,877
Security Surplus Excess (Deficit)
$ 91,692,782
Progressive Universal Insurance Company
Analysis of Surplus
For the 5-Year Period Ending December 31, 2022
The following schedule details items affecting surplus during the period under
examination as reported by the company in its filed annual statements:
2022
2021
2020
2019
2018
Surplus, beginning of
year
$235,730,516
$231,510,569
$206,924,130
$174,224,694
$143,434,132
Net income
31,499,590
24,940,419
78,350,585
48,023,268
37,176,471
Change in net unrealized
capital gains/losses
(3,305,853)
(152,847)
Change in net deferred
income tax
735,687
298,583
1,443,554
1,037,580
1,425,883
Change in non-admitted
assets
(1,286,281)
3,633,792
(3,207,700)
(361,412)
(811,792)
Dividends to
stockholders
(4,700,000)
(24,500,000)
(52,000,000)
(16,000,000)
(7,000,000)
Surplus, End of Year
$258,673,659
$235,730,516
$231,510,569
$206,924,130
$174,224,694
20
P&CBLK_02-19.dotm
Growth of Progressive Universal Insurance Company
Year
Admitted
Assets
Liabilities
Surplus as
Regards
Policyholders
Net
Income
2022
$811,702,040
$553,028,381
$258,673,659
$31,499,590
2021
724,430,956
488,700,440
235,730,516
24,940,419
2020
657,305,851
425,795,282
231,510,569
78,350,585
2019
596,998,565
390,074,435
206,924,130
48,023,268
2018
520,832,986
346,608,292
174,224,694
37,176,471
2017
440,265,497
296,831,365
143,434,132
22,371,983
Year
Gross Premium
Written
Net
Premium
Written
Premium
Earned
Loss and
LAE
Ratio
Expense
Ratio
Combined
Ratio
2022
$2,354,772,858
$695,753,656
$671,332,498
78.7%
15.4%
94.1%
2021
2,123,078,882
633,458,230
619,535,570
77.2
18.3
95.5
2020
1,970,754,089
577,675,755
565,278,511
63.0
21.7
84.7
2019
1,830,177,747
530,123,003
515,167,618
71.1
17.9
89.0
2018
1,593,450,186
459,450,802
440,346,014
72.0
17.1
89.1
2017
1,332,227,250
380,083,265
364,000,596
73.6
16.9
90.5
During the period under examination, Progressive Universal Insurance Company
reported an 84.5% increase in assets, an 86.2 % increase in liabilities, and an 80.3% increase in
surplus. The company remained profitable and financially stable despite the natural catastrophes,
the COVID-19 pandemic, and the increasing cost of insurance losses. The company reported a
substantial increase in net income of 250%, or $78 million, in 2020 compared to the year 2017 of
$22 million, which dropped to $31 million in 2022. The unusual change in net income was due to
the increase in premium growth in the commercial segments due to the greater demand for
shipping services during the pandemic. The loss and LAE ratio remained stable and was at its
lowest in 2020 at 63.0% to offset the highest expense ratio of 21.7% that year, resulting in a
combined ratio of 84.7%, which was at the lowest in its range within the examined period. In
2022, the combined ratio was 94.1% compared to the industry average of 102.5%, according to
the NAIC US Property & Casualty Industry Report published on the NAIC website.
21
P&CBLK_02-19.dotm
Reconciliation of Surplus per Examination
No adjustments were made to surplus as a result of the examination. The amount of
surplus reported by the company as of December 31, 2022, is accepted.
22
P&CBLK_02-19.dotm
VII. SUMMARY OF EXAMINATION RESULTS
Compliance with Prior Examination Report Recommendations
The were no specific comments or suggestions in the previous examination report.
Summary of Current Examination Results
The current examination resulted in no adverse comments or recommendations.
23
P&CBLK_02-19.dotm
VIII. CONCLUSION
The company was incorporated under Illinois law in 1992. Ownership of the company
was transferred to Progressive Direct Holdings, Inc., on January 1, 2004. Effective December 21,
2004, Progressive Universal redomesticated to Wisconsin from Ohio.
Progressive Universal has no employees. All operations are conducted by employees
of Progressive subsidiaries in accordance with their business practices and internal controls.
Management operations and claim services are provided under a joint management services
agreement with Progressive Direct Insurance Company.
The company participates in a pooling reinsurance agreement as a member of the
Direct Pool and assumes a 4% share of the pooled business.
The previous examination of Progressive Universal Insurance Company resulted in
no recommendations and no adjustments to surplus. The current examination also resulted in no
adverse comments or recommendations. No adjustments were made to surplus as a result of the
examination. The amount of surplus reported by the Company as of December 31, 2022, is
accepted.
24
P&CBLK_02-19.dotm
IX. ACKNOWLEDGMENT
The courtesy and cooperation extended by the officers and employees of the
company during the course of the examination are acknowledged.
In addition to the undersigned, the following representatives of the Office of the
Commissioner of Insurance, State of Wisconsin, participated in the examination:
Name Title
Takoda Boyd
Insurance Financial Examiner
Nick Hartwig, AFE
Quality Control Specialist
Jerry DeArmond, CFE
Reserve Specialist
Respectfully submitted,
Ana Careaga
Examiner-in-Charge