Progressive Auto Insurance Not Paying Dividends

Just in case there was any confusion as to how the economy has been doing, Progressive Auto Insurance has announced that they will not be paying any annual dividends this year. The Board of Directors of the auto insurance company confirmed on Friday, December 12th of this year that they would not be paying any dividends under the Company’s annual variable dividend policy.

According to the auto insurance company’s policy, a dividend will be paid out when the after tax comprehensive income is less than after tax underwriting income. Based on their results through November 30th, this will be the case with their income. The Board cannot pay out the dividend as the amount is not high enough to warrant one.

They also decided that the dividend for next year will be determined the same way that the one for this year was – with the dividend equaling the after Tax underwriting income multiplied by 20% target, multiplied by the gain share factor.

The auto insurance company knows that their shareholders will be disappointed but in this economy there is really nothing else they can do. They say that they have already cut corners as much as they can, but short of raising auto insurance rates they are doing all they can. They hope that their shareholders realize the sacrifices that everyone has to make right now.

They encourage anyone who wants more details regarding their annual variable dividend policy to visit their web site at http://investors.progressive.com/dividend.aspx. This will give you all the information you need to know about the auto insurance company’s policy as well as their limitations.




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