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If any one or more of them does so, the events could materially adversely affect our financial condition, cash flows, or results of operations, and the market prices of our equity or debt securities could decline.
−Removed: This information should be considered carefully together with the other information contained in this report and in the other reports and materials filed by us with the SEC, as well as news releases and other information we publicly disseminate from time to time.
+Added: This information should be considered carefully together with the other information contained in this report and in the other reports and materials filed by us with the Securities and Exchange Commission (SEC), as well as news releases and other information we publicly disseminate from time to time.
Insurance Risks
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• our ability to understand the impact of ongoing changes in our claim settlement practices
−Removed: • changing vehicle usage and driving patterns, which may be influenced by epidemics, pandemics, other widespread health risks, or changes in oil and gas prices, among other factors, changes in residential occupancy patterns, and the sharing economy
−Removed: • advancements in vehicle or home technology or safety features, such as accident and loss prevention technologies or the development of autonomous or partially autonomous vehicles
+Added: • changing vehicle usage and driving patterns, which may be influenced by epidemics, pandemics, other widespread health risks, or changes in oil and gas prices, among other factors, changes in residential occupancy patterns, and the ridesharing economy
+Added: • advancements in vehicle or home technology or safety features, such as accident and loss prevention technologies or the development of autonomous or semi-autonomous vehicles
• unexpected changes in the medical sector of the economy, including medical costs and systemic changes resulting from national or state healthcare laws or regulations
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• unanticipated changes in auto repair costs, auto parts prices, used car prices, construction requirements, labor and materials costs, and the imposition and impacts of tariffs
−Removed: We are seeing various insurance regulations, legislative and regulatory challenges, political initiatives, and other societal pressures that seek to limit or prohibit the use of specific rating factors in insurance policy pricing, such as credit, education, and occupation.
+Added: Various insurance regulations, legislative and regulatory challenges, political initiatives, and other societal pressures seek to limit or prohibit the use of specific rating factors in insurance policy pricing, such as credit, education, and occupation.
In our view, these efforts have the potential to significantly undermine the effectiveness of risk-based pricing.
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Further, the availability and cost of reinsurance are subject to prevailing reinsurance market conditions, which have been, and in the future could be, adversely impacted by the underwriting capacity of the reinsurance industry.
−Removed: That underwriting capacity can be influenced by
−Removed: several factors, including industry losses, changes in legal and regulatory guidelines, and the occurrence of significant reinsured events, such as weather-related catastrophes, among other things.
+Added: That underwriting capacity can be influenced by several factors, including industry losses, changes in legal and regulatory guidelines, and the occurrence of significant reinsured events, such as weather-related catastrophes, among other things.
Depending on the impact of any of these factors, we may not be able to obtain reinsurance coverage in the future at all or with commercially reasonable rates, terms, and conditions.
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Our business requires that we develop and maintain large and complex technology systems, and that we rely on third-party systems and applications, to run our operations and to store the significant volume of data that we acquire, including the personal information of our customers and employees and our intellectual property, trade secrets, and other sensitive business and financial information.
−Removed: All of these systems are subject to “cyberattacks” by third parties with substantial computing resources and capabilities, which are becoming more frequent and more sophisticated, and to unauthorized or illegitimate actions by employees, consultants, agents, and other persons with legitimate access to our systems.
+Added: All of these systems are subject to “cyberattacks” by third parties with substantial computing resources and capabilities, which have become more frequent and more sophisticated, and to unauthorized or illegitimate actions by employees, consultants, agents, and other persons with legitimate access to our systems.
Such attacks or actions may include attempts to:
• access our systems
−Removed: • improperly use, steal, sell, corrupt, or destroy data or information, including our intellectual property, financial data, or the personal information of our customers, employees, or other individuals
+Added: • improperly access, use, steal, sell, corrupt, or destroy data or information, including our intellectual property, financial data, or the personal information of our customers, employees, or other individuals
• misappropriate funds or extract ransom payments
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If our marketing campaigns are unsuccessful or are less effective than those of competitors, or if our reliance on a particular spokesperson or character is compromised, our business could be materially adversely affected.
−Removed: Our brand and reputation also could be adversely affected by situations that reflect negatively on us, whether due to our business practices, adverse financial developments, perceptions of our corporate governance, perceptions of our purpose-driven brand, how we address employee matters and concerns, our approach to environmental, social, sustainability and corporate responsibility matters, investments in our portfolio, the conduct of our officers, directors, or employees, or other causes.
+Added: Our brand and reputation also could be adversely affected by situations that reflect negatively on us, whether due to our business practices, adverse financial developments, perceptions of our corporate governance, perceptions of our purpose-driven brand, how we address employee matters and concerns, our approach to environmental and social (Sustainability) and corporate responsibility matters, investments in our portfolio, the conduct of our officers, directors, or employees, or other causes.
It may also be harmed by the actions of third parties that are generally outside of our control, including agents, significant customers, or other businesses with which we do business or in which we invest, such as third-party providers that interface with our customers, unaffiliated insurers and other companies whose products we offer or make available to our customers, or other causes.
−Removed: The negative impacts of these or other events may be aggravated as consumers, regulators, and other stakeholders increase or change their expectations, or adopt conflicting expectations, regarding the conduct of large public companies, environmental, social, and governance (ESG) standards, and sustainability and corporate responsibility efforts, programs, and initiatives.
+Added: The negative impacts of these or other events may be aggravated as consumers, regulators, and other stakeholders increase or change their expectations, or adopt conflicting expectations, regarding the conduct of large public companies, sustainability and corporate responsibility efforts, programs, and initiatives, and corporate governance and Sustainability standards.
These expectations and standards are continually evolving and not always clear.
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As a result, if we do not handle these transitions effectively and bring such innovations to market with the requisite speed and agility, the quality of our products and services, our relationships with our customers and agents, and our business prospects, may be materially adversely affected.
−Removed: In addition, innovations by competitors or other market participants may increase the level of competition in the industry.
+Added: In addition, innovations by competitors or other market participants may increase the level of
+Added: competition in the industry.
If we fail to respond appropriately in a timely manner to those innovations and also to the evolving customer preferences, our competitive position and results may be materially adversely affected.
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• the availability and uses of very large volumes of data and the challenges relating to analyzing those data sets, including the availability of sufficient internal and external talent that understand and can manage the complexity and related risks
−Removed: Complexity may, among other potential difficulties, create barriers to innovation or the provision of high-quality products and customer and agent experiences with the speed and agility that may be required;
−Removed: require us to modify our business practices, adopt new systems or technology, or replace outdated systems or technology, or upgrade systems or technology to enhance the scale, performance or functionality, each at significant expense;
+Added: Complexity and legacy systems may, among other potential difficulties, create barriers to innovation or the provision of high-quality products and customer and agent experiences with the speed and agility that may be required;
+Added: require us to modify our business practices, adopt new software, systems or technology, or replace outdated software, systems or technology, or upgrade systems or technology to enhance the scale, performance or functionality, each at significant expense;
and lead to increased difficulty in executing our business strategies.
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Many of our competitors have substantial resources, experienced management, and strong marketing, underwriting, pricing, and technological capabilities.
−Removed: The property and casualty insurance industry is a relatively mature industry, in which brand recognition, marketing skills, innovation, operational effectiveness, pricing, scale, and cost control are major competitive factors.
+Added: The property and casualty insurance industry is a mature industry, in which brand recognition, marketing skills, innovation, operational effectiveness, pricing, scale, and cost control are major competitive factors.
If our competitors offer similar insurance products at lower prices, offer such insurance products bundled with other products or services that we do not offer, are permitted to offer their products under different legal and regulatory constraints than those that apply to us, or engage in other successful competitive initiatives, our ability to generate new business, or to retain a sufficient number of our existing customers, could be compromised.
In addition, because auto insurance constitutes a significant portion of our overall business, we may be more sensitive than other insurers to, and more adversely affected by, trends that could decrease auto insurance rates or reduce demand for auto insurance over time, such as advances in vehicle technology, autonomous or semi-autonomous vehicles, or vehicle-sharing arrangements.
+Added: Consolidations and strategic relationships in the independent agent channel in our Personal Lines business have increased competition and could continue to do so.
We may also be adversely affected in our Commercial Lines business, which represents a significant portion of our growth potential, by trends or events that decrease the demand for services offered by, or decrease the profitability of, the commercial auto market, including trucking businesses and ridesharing services.
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As more insurers react in this way, profit levels in the industry may increase to a point where some insurers begin to lower their rates, starting the cycle over again.
−Removed: The ability to discern at any point in time whether we are in a “hard” or “soft” market is often difficult, as such a conclusion represents an assessment of innumerable data points including, among others, the operating results of, and the dynamic competitive actions taken by, us and many competitors in multiple markets involving a variety of products.
+Added: The ability to discern at any point in time whether we are in a “hard” or “soft” market is often difficult, as such a conclusion represents an assessment of innumerable data points including, among others, the operating results of, and the dynamic competitive actions taken by, us and many competitors in multiple markets involving a variety of
Often, detailed information on our competitors becomes available on a delayed basis, and the nature of the market becomes apparent only in retrospect.
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The pace of change, together with shorter time frames between enactment or promulgation and effectiveness of the changes, increases this risk.
−Removed: Insurance laws and regulations may, among other things, limit an insurer’s ability to underwrite and price risks accurately, prevent the insurer from obtaining timely rate changes to respond to increased or decreased costs, delay or restrict the ability to discontinue or exit unprofitable businesses or jurisdictions, impose marketing restrictions or requirements related to the use of artificial intelligence and third-party data, prevent insurers from terminating policies under certain circumstances, dictate or limit the types of investments that an insurance company may hold, and impose specific requirements relating to information technology systems and related cybersecurity risks.
+Added: Insurance laws and regulations may, among other things, limit an insurer’s ability to underwrite and price risks accurately, prevent the insurer from obtaining timely rate changes to respond to increased or decreased costs, delay or restrict the ability to discontinue or exit unprofitable businesses or jurisdictions, limit the profit an insurer may earn, impose marketing restrictions or requirements related to the use of artificial intelligence and third-party data, prevent insurers from terminating policies under certain circumstances, dictate or limit the types of investments that an insurance company may hold, and impose specific requirements relating to information technology systems and related cybersecurity risks.
As a result, we have been, and may in the future be, limited in our ability to respond to evolving business conditions.
−Removed: Moreover, inconsistencies in requirements among the various states, or between state and federal requirements, or changes in regulatory priorities, may further complicate our compliance efforts, potentially resulting in additional costs for us.
+Added: For additional discussion of statutory profit limits, see Management’s Discussion and Analysis of Financial Condition and Results of Operations – II.
+Added: Financial Condition in the Annual Report.
+Added: Moreover, inconsistencies in requirements among the various states, or between state and federal requirements, or changes in regulatory priorities or funding, may further complicate our compliance efforts, potentially damage our reputation in the marketplace or our brand, potentially resulting in additional costs for us or impacting our ability to participate in certain government funded programs, such as the National Flood Insurance Program.
In addition, laws in certain jurisdictions mandate that insurance companies pay assessments in a number of circumstances, including potentially material assessments to pay claims upon the insolvency of other insurance companies or to cover losses in government-provided insurance programs for high-risk auto and homeowners’ coverages.
2 unchanged sentences
Various jurisdictions have enacted or are considering privacy and security legislation or regulations.
−Removed: Each jurisdiction’s unique requirements, and the variations across the jurisdictions, present further ongoing compliance challenges.
+Added: Each jurisdiction’s unique
+Added: requirements, and the variations across the jurisdictions, present further ongoing compliance challenges.
Compliance with these laws and regulations will result in increased costs, which may be substantial and may adversely affect our profitability or our ability or desire to grow or operate our business in certain jurisdictions.
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Our ability to attract, develop, and retain talent, including employees, managers, and executives, and to maintain appropriate staffing levels, is critical to our success.
−Removed: Our success depends on our ability to attract, develop, compensate, motivate, and retain talented employees, including executives, other key managers, and employees with strong technological, analytical, and other skills and know-how necessary for us to run our insurance businesses, investment operations, and corporate functions, assess potential expansion into new products and business areas, and adapt to technological trends in our industry.
−Removed: Our loss of certain executives and key employees, or the failure to attract or retain talented executives, managers, and employees with varied backgrounds, skills, knowledge, and experiences, could have a material adverse effect on our business.
+Added: Our success depends on our ability to attract, develop, compensate, motivate, and retain talented employees, including executives, other key managers, and employees with strong technical, analytical, and other skills and know-how necessary for us to run our insurance businesses, investment operations, and corporate functions, assess potential expansion into new products, services, and business areas, and adapt to technological trends in our industry.
+Added: Our loss of certain executives and key employees, or the failure to attract or retain talented executives, managers, and employees with varied and appropriate backgrounds, experiences, knowledge, perspectives, and skills, could have a material adverse effect on our business.
These risks may be heightened when United States labor markets, or key segments of those markets, are especially competitive.
−Removed: Our workplace policies or perceptions of those policies by current and potential employees, including policies with respect to virtual, hybrid, and in-person work protocols, could impact our ability to attract, onboard, and retain talent with needed skills, knowledge, and experiences.
+Added: Our workplace policies or perceptions of those policies by current and potential employees, including policies with respect to virtual, hybrid, and in-person work protocols, could impact our ability to attract, onboard, and retain talent with desired experiences, knowledge, perspectives, and skills.
In addition, we must forecast with reasonable accuracy sales and claims volume and other factors in changing business environments (for multiple products and business units and in many geographic markets), and we must adapt to increases in business due to additions of or expansions with significant customers, such as transportation network companies.
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Our success also depends, in large part, on our ability to maintain and improve the staffing effectiveness and culture that we have developed over the years.
−Removed: Our ability to do so may be impaired as a result of litigation against us, other judicial decisions, legislation or regulations, or other factors in the employment marketplace, as well as our failure to recognize and respond to changing trends and other circumstances that affect our employees or our culture, including any impact arising from a decrease in virtual and hybrid workers relative to recent market trends.
+Added: Our ability to do so may be impaired as a result of litigation against us, other judicial decisions, legislation or regulations, or other factors in the employment marketplace, as well as our failure to recognize and respond to changing trends and other circumstances that affect our employees or our culture, including any impact arising from a decrease
+Added: in virtual and hybrid workers relative to recent market trends.
In such events, the productivity of our workers and the efficiency of our operations could be adversely affected, which could lead to an erosion of our operating performance and margins.
Lawsuits challenging our business practices, and those of our competitors and other companies, are pending and more may be filed in the future.
−Removed: The Progressive Corporation and/or its subsidiaries are named as defendants in class actions, collective actions, representative actions, and other lawsuits challenging various aspects of the subsidiaries’ business operations.
+Added: The Progressive Corporation and/or its subsidiaries are named as defendants in class actions, collective actions, representative actions, and individual and other lawsuits challenging various aspects of the subsidiaries’ business operations.
Certain pending lawsuits are described in Note 12 – Litigation in the Annual Report.
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Intellectual property rights could affect our competitiveness and our business operations.
−Removed: There has been a proliferation of patents, both inside and outside the insurance industry, that significantly impacts our businesses.
+Added: There continues to be a proliferation of patents, both inside and outside the insurance industry, that significantly impacts our businesses.
The existence of such patents, and other claimed intellectual property rights, from time to time has resulted in legal challenges to certain of our business practices by other insurance companies and non-insurance entities alleging that we are violating their rights.
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However, we may not be able to obtain patents on these processes and practices, and defending our patents and other intellectual property rights against challenges, and enforcing and defending our rights, including, if necessary, through litigation, can be time consuming and expensive, and the results are inherently uncertain, which can further complicate business plans.
−Removed: Our development and use of new technology, such as generative artificial intelligence, may present additional risks, may not be successful, and could have a material adverse effect on our business .
+Added: Our development and use of new technology, such as generative and agentic artificial intelligence, may present additional risks, may not be successful, and could have a material adverse effect on our business .
We have developed, and used for many years, new technologies, including machine learning and other forms of artificial intelligence (AI), predictive models, algorithms and automated processes, and will in the future develop and use AI and other new technologies in our business.
−Removed: As with many technological innovations, the growing development and use of generative AI (GenAI) presents additional risks that may adversely affect our business.
−Removed: GenAI might produce or reveal datasets that are flawed or insufficient or contain biased information, which could result in unintentionally and unfairly discriminatory outcomes in our business processes.
−Removed: These deficiencies could also undermine the associated predictions, analysis, or decisions GenAI applications produce or the business decisions we make based on this information.
+Added: As with many technological innovations, the growing development and use of generative and agentic AI (Advanced AI) presents additional risks that may adversely affect our business.
+Added: Advanced AI might produce or reveal datasets that are flawed or insufficient or contain biased information, which could result in unintentionally and unfairly discriminatory outcomes in our business processes.
+Added: These deficiencies could also undermine the associated predictions, analysis, or decisions Advanced AI applications produce or the business decisions we make based on this information.
We could face challenges on whether we use AI in our business processes in a responsible, compliant, and effective manner.
−Removed: Since GenAI is subject to public debate, and depending on how observers view our development and use of AI, we could be subject to criticism or experience an adverse impact on our brand or reputation, which could decrease demand for our products or services, create difficulties in our ability to recruit and retain employees and lead to greater regulatory scrutiny of our businesses.
+Added: Since Advanced AI is subject to public debate, and depending on how observers view our development and use of AI, we could be subject to criticism or experience an adverse impact on our brand or reputation, which could decrease demand for our products or services, create difficulties in our ability to recruit and retain employees and lead to greater regulatory scrutiny of our businesses.
Additionally, one or more of our key vendors may begin to use AI in their business in a manner that does not meet existing or rapidly evolving regulatory standards.
−Removed: Furthermore, our competitors or other third parties may be able to incorporate GenAI into their products more quickly, or more successfully, than us.
−Removed: Intellectual property ownership rights, including those associated with related copyrights, patent rights, GenAI inputs for model training, and other GenAI outputs, have not been fully interpreted by courts or regulations.
+Added: Furthermore, our competitors or other third parties may be able to replace legacy systems, incorporate Advanced AI into their products and operations, or optimize or redesign their processes more quickly, or more successfully, than us.
+Added: Intellectual property ownership rights, including those associated with related copyrights, patent rights, Advanced AI inputs for model training, and other Advanced AI outputs, have not been fully interpreted by courts or regulations.
Additionally, we are subject to new AI-focused regulations and regulatory expectations that could impose varied compliance and reporting requirements and challenges that could impact our operations or ability to write business profitably in one or more jurisdictions.
10 unchanged sentences
• Interest rate risk - the risk of adverse changes in the value of fixed-income securities as a result of increases in market interest rates.
−Removed: • Investment credit risk – the risk that the value of certain investments may decrease due to a deterioration in the financial condition, operating performance, or business prospects of, the regulatory environment applicable to, or the
−Removed: liquidity available to, one or more issuers of those securities or, in the case of asset-backed securities, due to the deterioration of the loans or other assets that underlie the securities.
+Added: • Investment credit risk - the risk that the value of certain investments may decrease due to a deterioration in the financial condition, operating performance, or business prospects of, the regulatory environment applicable to, or the liquidity available to, one or more issuers of those securities or, in the case of asset-backed securities, due to the deterioration of the loans or other assets that underlie the securities.
• Concentration risk - the risk that the portfolio may be too heavily concentrated in the securities of one or more issuers, sectors, or industries, which could result in a significant decrease in the value of the portfolio in the event of a deterioration of the financial condition or performance of, the regulatory environment applicable to, or outlook for, those issuers, sectors, or industries.
18 unchanged sentences
Results of Operations – Investments in the Annual Report for additional discussion of the composition of our investment portfolio as of December 31, 2025, and of the market risks associated with our investment portfolio.
−Removed: New regulations and societal pressures relating to ESG and other public policy matters could negatively impact our returns or cause us to change our investing strategies in ways that could negatively impact our results.
−Removed: The value of securities held in our portfolio could be materially adversely impacted as issuers or the businesses or assets underlying such securities are faced with new, potentially conflicting, laws or regulations or initiatives by regulators, investors, activists, or others, including those addressing ESG, sustainability, corporate responsibility or other public policy concerns.
+Added: New regulations and societal pressures relating to Sustainability and other public policy matters could negatively impact our returns or cause us to change our investing strategies in ways that could negatively impact our results.
+Added: The value of securities held in our portfolio could be materially adversely impacted as issuers or the businesses or assets underlying such securities are faced with new, potentially conflicting, laws or regulations or initiatives by regulators, investors, activists, or others, including those addressing Sustainability, corporate governance, corporate responsibility or other public policy concerns.
For example, the universe of securities that we are permitted to hold could be significantly narrowed by insurance regulators if we are prohibited from investing in certain industries or types of companies or we could be required to make additional disclosures when we acquire any such securities.
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If we are unable to obtain capital at favorable rates when needed, whether due to our results, volatility, or disruptions, in debt and equity markets due to factors beyond our control, or other reasons, our financial condition could be materially adversely affected.
−Removed: In such an event, unless and until additional sources of capital are secured, we may be limited in
−Removed: our ability, or unable, to service our debt obligations, pay dividends, grow our business, pay our other obligations when due, or engage in other corporate transactions.
+Added: In such an event, unless and until additional sources of capital are secured, we may be limited in our ability, or unable, to service our debt obligations, pay dividends, grow our business, pay our other obligations when due, or engage in other corporate transactions.
Such a deterioration of our financial condition could adversely affect the perception of our company by insurance regulators, potentially resulting in regulatory actions, and the price of our equity or debt securities could fall significantly.
25 unchanged sentences
We do not provide earnings estimates to the market and do not comment on earnings estimates by analysts.
−Removed: As a result, our reported results for a particular period may vary, perhaps significantly, from investors’ expectations, which could result in significant volatility in the price of our equity or debt
+Added: As a result, our reported results for a particular period may vary, perhaps significantly, from investors’ expectations, which could result in significant volatility in the price of our equity or debt securities.
Our personal property business has caused, and is likely to continue to cause, additional volatility in our consolidated results.
−Removed: Due to our focus on the long-term value of the enterprise, similar tradeoffs may be involved in our consideration of the interests of other stakeholders, including our employees, customers, agents, suppliers, and communities, as well as whether and how we respond to or address ESG, sustainability, and corporate responsibility initiatives, programs and efforts and other public policy matters that impact us.
+Added: Due to our focus on the long-term value of the enterprise, similar tradeoffs may be involved in our consideration of the interests of other stakeholders, including our employees, customers, agents, suppliers, and communities, as well as whether and how we respond to or address Sustainability, corporate governance, and corporate responsibility initiatives, programs and efforts and other public policy matters that impact us.
These types of initiatives and considerations are fast-evolving areas and determining appropriate responses and actions can be uncertain.
3 unchanged sentences
Our business and results of operations could be adversely affected by epidemics, pandemics, or other widespread health risks.
−Removed: Beginning with its emergence in 2020, COVID-19 increased many of the risks described above and impacted our business, operations, and financial results in several ways.
−Removed: We have discussed the associated risks and impacts of COVID-19 in our SEC filings beginning with its onset in 2020.
−Removed: We believe that the existing risks and impacts of COVID-19 are not currently material to our business.
−Removed: Any future epidemic, pandemic, or other widespread health risk, including a new variation of the COVID-19 virus, could exacerbate the impacts of many of the other risk factors described above and adversely affect our business.
+Added: An epidemic, pandemic, or other widespread health risk could exacerbate the impacts of many of the other risk factors described above and adversely affect our business.
Depending on the duration and severity of any such epidemic, pandemic, or other widespread health risk, and the nature and extent of governmental responses to it, our business, our operations, and our financial results could be negatively impacted.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.