NU Online News Service, Aug. 17, 10:55 a.m. EDT

Progressive Corp. says its July net income dropped 55 percent over the same period last year on $23 million in catastrophe losses—the bulk of which occurred in five states.

Net income for the month dropped $62 million to $51 million for the month; however, net premiums earned in July rose 5 percent, or $62 million, to nearly $1.44 billion.

The Mayfield Village, Ohio-based auto insurer says its combined ratio for July rose 3.5 points to 95.4.

On a year-to-date basis, net income is up 6 percent, or $38.5 million, to $659 million. Total revenues are up 5 percent, or $429 million, to $9.23 billion.

Progressive says Colorado, Minnesota, Wyoming, Illinois and New York accounted for almost 70 percent of catastrophe losses in July.

The company says about 1 percent of its personal lines net premiums written and earned reflect a prior year adjustment for ceded premiums on its motorcycle policies to a state reinsurance facility. The adjustment reflects Progressive's estimated underpayment of prior year's premiums related to the excess of loss coverage provided by the facility. The premium reduction occurred primarily in its independent agency channel.

The company reports increases in policies-in-force in its agency-auto and direct-auto businesses, rising 3 and 7 percent respectively. Total personal lines business rose 5 percent, while the commercial lines business stood at minus 1 percent.

Earlier this month Progressive reported second-quarter net income rose 16 percent to $245.2 million as net premiums written increased 3 percent during the same time. For the month of June, Progressive reports an increase of 8 percent in policies-in-force from direct business and a 3 percent increase from agency-driven business.

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Progressive July Net Income Drops 55% On Cat Losses

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