Progressive Insurance Company reported net income for Aprilincreasing 8 percent over the same period last year.
|The Mayfield, Ohio-based company reported April profits of$159.6 million compared with $147.6 million for the same month in2005.
|Both net premium written and net premium earned rose 4 percentfor the month compared with April of 2005.
|The combined ratio remained virtually flat at 85.9.
|Bear Stearns analyst David Small said the results exceededexpectations. Personal auto premium per policy in both the agentand direct channels was higher than forecasted, and the overallaccident-year loss ratio was lower than anticipated.
|“While this is only one month, the results suggest thatProgressive was less aggressive in lowering price than in previousmonths,” Mr. Small wrote.
|He suggested that management may have concluded that lowerpricing was not necessary to produce the top line growth required,and that lower pricing was not increasing demand for theproduct.
|“If this is the case, it could be positive for personal autoplayers in general, particularly Allstate, as it may indicate oneof the largest and more price aggressive companies may be backingoff a bit,” he wrote.
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