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PROGRESSIVE SETTLES ALL CALIFORNIA PROPOSITION 103 ROLLBACK EXPOSURE

 PROGRESSIVE SETTLES ALL CALIFORNIA
 PROPOSITION 103 ROLLBACK EXPOSURE
 MAYFIELD HEIGHTS, Ohio, June 12 /PRNewswire/ -- The Progressive Corporation, the nation's 14th highest premium volume auto insurer, today announced agreement with the California Department of Insurance to settle all of its rollback and refund exposure for business written since Proposition 103 was adopted.
 Under the agreement approved by Insurance Commissioner John Garamendi, Progressive agreed to roll back approximately $50 million to the approximately 260,000 people who bought Progressive policies during the rollback year (11/08/88 through 11/07/89). Progressive expects to mail refund checks in August. As part of the settlement, the Department approved all of Progressive's rates and programs in use in California since November 1988. Progressive also agreed to reduce rates 15 percent on future private passenger auto business (excluding motorcyle) written in California by two of its subsidiaries, not to seek rate increases for a year, and to cancel its planned withdrawal of motor home, travel trailer and commercial auto programs in California.
 Because the agreement resolves all of the Company's rollback and refund exposure under Proposition 103, Progressive will eliminate its Proposition 103 reserve, bringing approximately $100 million of that reserve into income during the second quarter. The Company will also discontinue reserving for Proposition 103. Progressive's Proposition 103 premium rollback and refund reserve was $153.3 million at the end of first quarter 1992.
 "We believe this settlement is in the best interests of both our shareholders and our California customers," said Progressive's CEO Peter B. Lewis. "Proposition 103 has profoundly affected Progressive. It has led us to address consumers' mistrust of and dislike for insurance companies by overhauling our business strategy. We are focused on reducing costs, improving service and giving consumers more control over their auto insurance purchase. We believe the free enterprise system rewards those companies who invest and risk the most to serve customers the best. With the rollback issue settled, we hope California will give us that opportunity."
 The Progressive Corporation is a Cleveland-based insurance and financial services holding company. Its subsidiaries provide personal automobile and specialty property-casualty insurance and related services throughout the United States and in Canada. Progressive reported total annual revenues of $1.49 billion for 1991, up 8 percent over 1990 and 40 percent over the past five years. Progressive has been in the auto insurance business for 55 years. Progressive's common shares are traded on the New York Stock Exchange (NYSE:PGR).
 -0- 6/12/92
 /CONTACT: Charles B. Chokel, Sr. VP/Finance of Progressive, 216-446-7260 or Marge Hlinka of Edward Howard & Co., 216-781-2400/ CO: The Progressive Corporation ST: Ohio IN: INS SU:


CG -- CL011 -- 9787 06/12/92 15:45 EDT
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Publication:PR Newswire
Date:Jun 12, 1992
Words:448
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