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Fair Value
 9 Months Ended
Sep. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value FAIR VALUE
We have categorized our financial instruments, based on the degree of subjectivity inherent in the method by which they are valued, into a fair value hierarchy of three levels, as follows:
•Level 1: Inputs are unadjusted, quoted prices in active markets for identical instruments at the measurement date (e.g., U.S. government obligations, which are continually priced on a daily basis, active exchange-traded equity securities, and certain short-term investments).
•Level 2: Inputs that are observable for the instrument either directly (other than quoted prices included within Level 1) or indirectly. This includes: (i) quoted prices for similar instruments in active markets, (ii) quoted prices for identical or similar instruments in markets that are not active, (iii) inputs other than quoted prices that are
observable for the instruments, and (iv) inputs that are derived principally from or corroborated by observable market data by correlation or other means.
•Level 3: Inputs that are unobservable. Unobservable inputs reflect our subjective evaluation about the assumptions market participants would use in pricing the financial instrument (e.g., certain privately held investments).
Determining the fair value of the investment portfolio is the responsibility of management. As part of that responsibility, we evaluate whether a market is distressed or inactive in determining the fair value for our portfolio. We review certain market level inputs to evaluate whether sufficient activity, volume, and new issuances exist to create an active market.
Based on this evaluation, we concluded there was sufficient activity related to the sectors and securities for which we obtained valuations.
The composition of the investment portfolio by major security type and our outstanding debt was:
 Fair Value 
(millions)Level 1Level 2Level 3TotalCost
September 30, 2025
Fixed maturities:
U.S. government obligations$51,339 $0 $0 $51,339 $51,021 
State and local government obligations0 3,275 0 3,275 3,320 
Foreign government obligations0 16 0 16 16 
Corporate and other debt securities0 18,812 5 18,817 18,621 
Residential mortgage-backed securities0 3,000 0 3,000 2,979 
Commercial mortgage-backed securities0 5,686 0 5,686 5,916 
Other asset-backed securities0 6,376 0 6,376 6,374 
Total fixed maturities51,339 37,165 5 88,509 88,247 
Short-term investments1,414 101 0 1,515 1,515 
    Total available-for-sale securities52,753 37,266 5 90,024 89,762 
Equity securities:
Nonredeemable preferred stocks0 378 60 438 454 
Common equities:
Common stocks4,004 0 9 4,013 774 
Other risk investments0 0 34 34 34 
Subtotal common equities4,004 0 43 4,047 808 
    Total equity securities4,004 378 103 4,485 1,262 
Total portfolio$56,757 $37,644 $108 $94,509 $91,024 
Debt$0 $6,398 $0 $6,398 $6,896 
 Fair Value 
(millions)Level 1Level 2Level 3TotalCost
September 30, 2024
Fixed maturities:
U.S. government obligations$44,429 $0 $0 $44,429 $44,231 
State and local government obligations0 2,601 0 2,601 2,681 
Foreign government obligations0 16 0 16 17 
Corporate and other debt securities0 15,033 3 15,036 14,970 
Residential mortgage-backed securities0 1,424 0 1,424 1,404 
Commercial mortgage-backed securities0 4,291 0 4,291 4,664 
Other asset-backed securities0 6,614 0 6,614 6,628 
Total fixed maturities44,429 29,979 3 74,411 74,595 
Short-term investments755 2 0 757 757 
    Total available-for-sale securities45,184 29,981 3 75,168 75,352 
Equity securities:
Nonredeemable preferred stocks0 683 52 735 760 
Common equities:
Common stocks3,452 0 22 3,474 710 
Other risk investments0 0 23 23 23 
Subtotal common equities3,452 0 45 3,497 733 
    Total equity securities3,452 683 97 4,232 1,493 
Total portfolio$48,636 $30,664 $100 $79,400 $76,845 
Debt$0 $6,498 $0 $6,498 $6,892 
 Fair Value 
(millions)Level 1Level 2Level 3TotalCost
December 31, 2024
Fixed maturities:
U.S. government obligations$45,988 $0 $0 $45,988 $47,103 
State and local government obligations0 2,778 0 2,778 2,893 
Foreign government obligations0 16 0 16 16 
Corporate and other debt securities0 13,949 5 13,954 14,111 
Residential mortgage-backed securities0 1,601 0 1,601 1,600 
Commercial mortgage-backed securities0 4,352 0 4,352 4,721 
Other asset-backed securities0 6,643 0 6,643 6,682 
Total fixed maturities45,988 29,339 5 75,332 77,126 
Short-term investments613 2 0 615 615 
    Total available-for-sale securities46,601 29,341 5 75,947 77,741 
Equity securities:
Nonredeemable preferred stocks0 676 52 728 756 
Common equities:
Common stocks3,527 0 23 3,550 720 
Other risk investments0 0 25 25 25 
Subtotal common equities3,527 0 48 3,575 745 
    Total equity securities3,527 676 100 4,303 1,501 
Total portfolio$50,128 $30,017 $105 $80,250 $79,242 
Debt$0 $6,173 $0 $6,173 $6,893 
Our portfolio valuations, excluding short-term investments valued at original cost, classified as either Level 1 or Level 2 in the above tables are priced exclusively by external sources, including pricing vendors, dealers/market makers, and exchange-quoted prices.
Our short-term investments classified as Level 1 include commercial paper, treasury bills, and money market funds, which are highly liquid, actively marketed, and have short durations. These securities are valued at their original cost, adjusted for any accretion of discount, which approximates fair value because of the relatively short period of time until maturity. The remainder of our short-term investments with a trade date to maturity of less than a year are classified as Level 2. These securities are classified as Level 2 since they are valued using external pricing vendor prices or are securities that continually trade at par value because they contain either liquidity facilities or mandatory put features within one year and as a result are valued at their original cost.
At September 30, 2025 and 2024 and December 31, 2024, vendor-quoted prices represented 93% of our Level 1 classifications (excluding short-term investments valued at original cost). The securities quoted by vendors in Level 1 primarily represent our holdings in U.S. Treasury Notes, which are frequently traded, and the quotes are considered similar to exchange-traded quotes. The balance of our Level 1 pricing comes from quotes obtained directly from trades made on active exchanges.
At September 30, 2025 and 2024, vendor-quoted prices comprised 99% of our Level 2 classifications (excluding short-term investments valued at original cost), with the
balance from dealer quotes, compared to 100% at December 31, 2024. In our process for selecting a source (e.g., dealer or pricing service) to provide pricing for securities in our portfolio, we reviewed documentation from the sources that detailed the pricing techniques and methodologies used by these sources and determined if their policies adequately considered market activity, either based on specific transactions for the particular security type or based on modeling of securities with similar credit quality, duration, yield, and structure that were recently transacted. Once a source is chosen, we continue to monitor any changes or modifications to their processes by reviewing their documentation on internal controls for pricing and market reviews. We review quality control measures of our sources as they become available to determine if any significant changes have occurred from period to period that might indicate issues or concerns regarding their evaluation or market coverage.
As part of our pricing procedures, we obtain quotes from more than one source to help us fully evaluate the market price of securities. However, our internal pricing policy is to use a consistent source for individual securities in order to maintain the integrity of our valuation process. Quotes obtained from the sources are not considered binding offers to transact. Under our policy, when a review of the valuation received from our selected source appears to be outside of what is considered market level activity (which is defined as trading at spreads or yields significantly different than those of comparable securities or outside the general sector level movement without a reasonable explanation), we may use an alternate source’s price. To the extent we determine that it may be prudent to substitute
one source’s price for another, we will contact the initial source to obtain an understanding of the factors that may be contributing to the significant price variance.
To allow us to determine if our initial source is providing a price that is outside of a reasonable range, we review our portfolio pricing on a weekly basis. When necessary, we challenge prices from our sources when a price provided does not match our expectations based on our evaluation of market trends and activity. Initially, we perform a review of our portfolio by sector to identify securities whose prices appear outside of a reasonable range. We then perform a more detailed review of fair values for securities disclosed as Level 2. We review dealer bids and quotes for these and/or similar securities to determine the market level context for our valuations. We then evaluate inputs relevant for each class of securities disclosed in the preceding hierarchy tables.
For structured debt securities, including commercial, residential, and other asset-backed securities, we evaluate available market-related data for these and similar securities related to collateral, delinquencies, and defaults for historical trends and reasonably estimable projections, as well as historical prepayment rates and current prepayment assumptions and cash flow estimates. We further stratify each class of structured debt securities into more finite sectors (e.g., planned amortization class, first pay, second pay, senior, and subordinated) and use duration and credit quality to determine if the fair value is appropriate.
For corporate and other debt, nonredeemable preferred stock, and the notes issued by The Progressive Corporation (see Note 4 – Debt), we review securities by duration, credit quality, and coupon, as well as changes in interest rate and credit spread movements within that stratification. The review also includes recent trades, including: volume traded at various levels that establish a market; issuer specific fundamentals; and industry-specific economic news as it comes to light.
For municipal securities (e.g., general obligations, revenue, and housing), we stratify the portfolio to evaluate securities by type, duration, credit quality, and coupon, to review price changes relative to credit spread and interest rate changes. Additionally, we look to economic data as it relates to geographic location as an indication of price-to-call or maturity predictors. For municipal housing securities, we look to changes in cash flow projections, both historical and reasonably estimable projections, to understand yield changes and their effect on valuation.

For short-term investments valued at original cost, we look at acquisition price relative to the coupon or yield. Since most of these securities are 60 days or less to maturity, we believe that original cost is the best estimate of fair value. For short-term investments valued with external vendor prices, we review securities by duration, credit quality, and coupon, as well as changes in interest rate and credit spread movements within that stratification, and recent trade information.
We also review data assumptions as supplied by our sources to determine if that data is relevant to current
market conditions. In addition, we independently review each sector for transaction volumes, new issuances, and changes in spreads, as well as the overall movement of interest rates along the yield curve to determine if sufficient activity and liquidity exists to provide a credible source for our market valuations.
During each valuation period, we create internal estimations of portfolio valuation (performance returns), based on current market-related activity (i.e., interest rate and credit spread movements and other credit-related factors) within each major sector of our portfolio. We compare our results to index returns for each major sector adjusting for duration and credit quality differences to better understand our portfolio’s results. Additionally, we review our external sales transactions and compare the actual final market sales prices to previous market valuation prices on a monthly basis. This review provides us further validation that our pricing sources are providing market level prices, and gives us additional comfort regarding the source’s process, the quality of its review, and its willingness to improve its analysis based on feedback from clients. We believe this effort helps ensure that we are reporting the most representative fair values for our securities.
After all the valuations are received and our review of Level 2 securities is complete, if the inputs used by vendors are determined to not contain sufficient observable market information, we will reclassify the affected securities to Level 3.

Except as described below, our Level 3 securities are priced externally; however, due to several factors (e.g., nature of the securities, level of activity, and lack of similar securities trading to obtain observable market level inputs), these valuations are more subjective in nature.
To the extent we receive prices from external sources (e.g., broker and valuation firm) for the Level 3 securities, we review those prices for reasonableness using internally developed assumptions and then compare our derived prices to the prices received from the external sources. Based on our review during the first nine months of 2025 and for the full year of 2024, all prices received from external sources remained unadjusted.
If we do not receive prices from an external source, we perform an internal fair value comparison, which includes a review and analysis of market-comparable securities, to determine if fair value changes are needed. Based on this analysis, certain private equity investments included in the
Level 3 category remain valued at cost or were priced using a recent transaction as the basis for fair value. At
least annually, these private equity investments are priced by an external source.
Our Level 3 other risk investments include securities accounted for under the equity method of accounting and, therefore, are not subject to fair value reporting. Since these securities represent less than 0.1% of our total portfolio, we include them in our Level 3 disclosures and report the activity from these investments as “other” changes in the summary of changes in fair value table and categorize these securities as “pricing exemption securities” in the quantitative information table.
During the first nine months of 2025 and for the full year of 2024, there were no material assets or liabilities measured at fair value on a nonrecurring basis.
Due to the relative size of the Level 3 securities’ fair values, compared to the total portfolio’s fair value, any changes in pricing methodology would not have a significant change in valuation that would materially impact net or comprehensive income.
The following tables provide a summary of changes in fair value associated with Level 3 assets for the three and nine months ended September 30, 2025 and 2024:
(millions)Fair Value at June 30, 2025Calls/
Maturities/
Paydowns/Other		PurchasesSalesNet Realized
(Gain)/Loss
on Sales
Change in
Valuation1
Net
Transfers
In (Out)		Fair Value at September 30, 2025
Fixed maturities:
Corporate and other debt securities$5 $0 $0 $0 $0 $0 $0 $5 
Equity securities:
Nonredeemable preferred stocks60 0 0 0 0 0 0 60 
Common equities:
 Common stocks9 0 0 0 0 0 0 9 
Other risk investments32 2 0 0 0 0 0 34 
Total Level 3 securities
$106 $2 $0 $0 $0 $0 $0 $108 
(millions)Fair Value at June 30, 2024Calls/
Maturities/
Paydowns/Other		PurchasesSalesNet Realized
(Gain)/Loss
on Sales
Change in
Valuation1
Net
Transfers
In (Out)		Fair Value at September 30, 2024
Fixed maturities:
Corporate and other debt securities$3 $0 $0 $0 $0 $0 $0 $3 
Equity securities:
Nonredeemable preferred stocks52 0 0 0 0 0 0 52 
Common equities:
Common stocks22 0 0 0 0 0 0 22 
Other risk investments24 (1)0 0 0 0 0 23 
Total Level 3 securities
$101 $(1)$0 $0 $0 $0 $0 $100 
(millions)Fair Value at December 31, 2024Calls/
Maturities/
Paydowns/Other		PurchasesSalesNet Realized
(Gain)/Loss
on Sales
Change in
Valuation1
Net
Transfers
In (Out)		Fair Value at September 30, 2025
Fixed maturities:
Corporate and other debt securities$5 $0 $0 $0 $0 $0 $0 $5 
Equity securities:
Nonredeemable preferred stocks52 0 8 0 0 0 0 60 
Common equities:
Common stocks23 0 0 0 0 (14)0 9 
Other risk investments25 9 0 0 0 0 0 34 
Total Level 3 securities$105 $9 $8 $0 $0 $(14)$0 $108 
(millions)Fair Value at December 31, 2023Calls/
Maturities/
Paydowns/Other		PurchasesSalesNet Realized
(Gain)/Loss
on Sales
Change in
Valuation1
Net
Transfers
In (Out)		Fair Value at September 30, 2024
Fixed maturities:
Corporate and other debt securities$3 $0 $0 $0 $0 $0 $0 $3 
Equity securities:
Nonredeemable preferred stocks64 0 0 0 0 (12)0 52 
Common equities:
Common stocks22 0 0 0 0 0 0 22 
Other risk investments21 2 0 0 0 0 0 23 
Total Level 3 securities
$110 $2 $0 $0 $0 $(12)$0 $100 
1 For fixed maturities, these amounts are included in accumulated other comprehensive income (loss) on our consolidated balance sheets. For equity securities, these amounts are included in our consolidated statements of comprehensive income.
The following tables provide a summary of the quantitative information about Level 3 fair value measurements for our applicable securities at September 30, 2025 and 2024, and December 31, 2024:
($ in millions)Fair Value at September 30, 2025Valuation
Technique		Unobservable InputRange of
Input Values
Increase
(Decrease)		Weighted
Average
Increase
(Decrease)
Fixed maturities:
Corporate and other debt securities$5 Market comparablesWeighted average market capitalization price change %
(1.0)% to (0.9)%
(1.0)%
Equity securities:
Nonredeemable preferred stocks60 Market comparablesWeighted average market capitalization price change %
(6.6)% to 11.3%
3.8 %
Common stocks9 Market comparablesWeighted average market capitalization price change %
(21.5)% to 74.6%
11.3 %
Subtotal Level 3 securities74 
Pricing exemption securities34 
Total Level 3 securities$108 


($ in millions)Fair Value at September 30, 2024Valuation
Technique		Unobservable InputRange of
Input Values
Increase
(Decrease)		Weighted
Average
Increase
(Decrease)
Fixed maturities:
Corporate and other debt securities$3 Market comparablesWeighted average market capitalization price change %
(3.1)% to 10.9%
2.6 %
Equity securities:
Nonredeemable preferred stocks52 Market comparablesWeighted average market capitalization price change %
4.0% to 25.0%
18.1 %
Common stocks22 Market comparablesWeighted average market capitalization price change %
(19.1)% to 69.6%
19.0 %
Subtotal Level 3 securities77 
Pricing exemption securities23 
Total Level 3 securities$100 


($ in millions)Fair Value at December 31, 2024Valuation
Technique		Unobservable InputRange of
Input Values
Increase
(Decrease)		Weighted
Average
Increase
(Decrease)
Fixed maturities:
Corporate and other debt securities$5 Market comparablesWeighted average market capitalization price change %
(1.4)% to (1.3)%
(1.4)%
Equity securities:
Nonredeemable preferred stocks52 Market comparablesWeighted average market capitalization price change %
(14.1)% to 6.0%
(2.7)%
Common stocks23 Market comparablesWeighted average market capitalization price change %
(41.3)% to 95.9%
6.0 %
Subtotal Level 3 securities80 
Pricing exemption securities25 
Total Level 3 securities$105