<PAGE> 1
Securities and Exchange Commission
Washington, D.C. 20549
FORM 11-K
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1993
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ________________ to _______________
Commission file number 1-9518
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
THE PROGRESSIVE CORPORATION
LONG-TERM SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
THE PROGRESSIVE CORPORATION
6300 WILSON MILLS ROAD
MAYFIELD VILLAGE, OHIO 44143
<PAGE> 2
THE PROGRESSIVE CORPORATION
LONG-TERM SAVINGS PLAN
________
FINANCIAL STATEMENTS
AND SUPPLEMENTAL SCHEDULES
FOR THE YEARS ENDED DECEMBER 31, 1993 AND 1992
<PAGE> 3
INDEX OF FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
---------------
Pages
-----
Report of Independent Accountants 2
Financial Statements:
Statements of Net Assets Available for Plan Benefits,
December 31, 1993 and 1992 3
Statements of Changes in Net Assets Available for Plan Benefits
for the years ended December 31, 1993 and 1992 4
Notes to Financial Statements 5-15
Supplemental Schedules:
Item 27a - Schedule of Assets Held for Investment
Purposes for the year ended December 31, 1993 16-17
Item 27d - Schedule of Reportable Transactions
for the year ended December 31, 1993 18
<PAGE> 4
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors
The Progressive Corporation:
We have audited the accompanying statements of net assets available for plan
benefits of The Progressive Corporation Long-Term Savings Plan as of December
31, 1993 and 1992, and the related statements of changes in net assets
available for plan benefits for the years then ended. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits of the Plan
as of December 31, 1993 and 1992, and the changes in net assets available for
plan benefits for the years then ended in conformity with generally accepted
accounting principles.
As discussed in Note 8 to the financial statements, in 1993 the Plan changed
its method of accounting for benefits payable.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed on
page 1 are presented for the purpose of additional analysis and are not a
required part of the basic financial statements, but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedules have been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion,
are fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
/s/ Coopers & Lybrand
Cleveland, Ohio
June 24, 1994
2
<PAGE> 5
<TABLE>
THE PROGRESSIVE CORPORATION
LONG-TERM SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1993 AND 1992
---------------
(000's omitted)
<CAPTION>
ASSETS 1993 1992
------ ------------- -------------
<S> <C> <C>
Investments, at fair value:
Progressive Corporation common shares $ 92,490 $65,051
Other investments 12,439 13,676
Other securities 8,815 4,380
------------- -------------
113,744 83,107
------------- -------------
Receivables:
Employer's contribution 158 71
Participants' contributions 371 191
Participants' loans 2,720 1,629
Accrued interest and dividends 66 191
------------- -------------
3,315 2,082
------------- -------------
Cash and cash equivalents 826 425
------------- -------------
Total assets 117,885 85,614
------------- -------------
LIABILITIES
-----------
Benefits payable (Note 8) -- 2,126
------------- -------------
Net Assets Available for Plan Benefits $117,885 $83,488
============= =============
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
3
<PAGE> 6
<TABLE>
THE PROGRESSIVE CORPORATION
LONG-TERM SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1993 AND 1992
---------------
(000's omitted)
<CAPTION>
1993 1992
--------------- -------------
<S> <C> <C>
Additions to Net Assets Attributed to:
Investment income:
Net appreciation in fair value of Progressive
Corporation common shares $25,374 $24,991
Net appreciation (depreciation) in fair value
of other investments 14 (3)
Net appreciation in fair value of other securities 268 323
Dividends on Progressive Corporation common shares 448 434
Interest and other dividends 1,128 1,046
--------------- -------------
27,232 26,791
--------------- -------------
Contributions:
Employer 3,910 3,447
Participants 9,316 8,044
--------------- -------------
13,226 11,491
--------------- -------------
Total additions 40,458 38,282
--------------- -------------
Deductions from Net Assets Attributed to:
Benefits paid to participants (8,187) (13,298)
Cumulative effect of change in accounting principle 2,126 --
--------------- -------------
Net increase 34,397 24,984
Net Assets Available for Plan Benefits:
Beginning of year 83,488 58,504
--------------- -------------
End of year $117,885 $83,488
=============== =============
<FN>
The accompanying notes are an integral part
of these financial statements.
</TABLE>
4
<PAGE> 7
NOTES TO FINANCIAL STATEMENTS
--------
1. DESCRIPTION OF THE PLAN:
-----------------------
The following description of The Progressive Corporation Long-Term
Savings Plan (the "Plan") provides only general information.
Participants should refer to the Plan agreement for a more complete
description of the Plan's provisions.
A. GENERAL:
-------
The primary purposes of the Plan are to encourage employee
savings, to facilitate employee ownership of The Progressive
Corporation (the "Company") common shares and to provide benefits
upon an employee's retirement, death, disability or termination of
employment.
All employees of the Company and certain of its subsidiaries that
have adopted the Plan, who are not classified by the Company as
temporary employees for whom employment is on a task or project
basis for a period of less than six months, are eligible to
participate in the Plan after 30 calendar days from the date of
employment ("Covered Employee").
Effective July 1, 1993, the Plan discontinued the Stein Roe funds
and offered seven Vanguard mutual funds in their place. Also, as
the State Street Selection Fund contracts expire, the funds are
being invested in the Vanguard Variable GIC Fund.
B. CONTRIBUTIONS:
-------------
Plan participants may contribute to the Plan on a pre- or post-tax
basis, including the Company's contribution, up to 18% of
eligible compensation. However, if earnings are greater than
$64,245 and $62,345 in 1993 and 1992, respectively, participants'
contributions to the Plan are limited to 7% on a pre-tax basis and
6% on a post-tax basis of eligible compensation. Participant
contributions are matched 100% by the Company up to 1% of
participant's compensation and 50% of contributions above 1% of
compensation up to the next 4% of compensation. Company
contributions are payable out of net profits. Total participant
and employer contributions are limited to a $30,000 per year
maximum.
Various Internal Revenue Code regulations concerning both employee
and Company contributions may limit the contribution amounts
defined above. The Company has the right to limit these
contributions to conform with applicable regulations.
C. PARTICIPANT ACCOUNTS:
--------------------
Each participant's account is credited with the participant's
contribution, the Company match and an allocation of Plan
earnings. Allocations are based on the portion of each
participant's account balance to the total account balances for
all Plan participants within each individual fund. The benefit to
which a participant is entitled is the benefit that can be
provided from the participant's account.
5
<PAGE> 8
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
<TABLE>
C. PARTICIPANT ACCOUNTS: (continued)
--------------------
Effective July 1, 1993, the Plan converted to the unit value
method for allocating Plan earnings. The unit values are
determined on a daily basis and are presented excluding
contributions receivable and benefits payable. The total number
of units and unit values as of December 31, 1993 by fund are as
follows:
<CAPTION>
Net Asset
Investment Options Total Number of Units Unit Value
------------------ --------------------- -------------
<S> <C> <C>
Company Common Shares 74,946.01212 $1,239.86160
Guaranteed Interest Fund 9,549.54127 1,035.32479
Explorer Fund 894.62882 1,136.99912
International Growth Fund 1,082.44745 1,238.84541
US Growth Fund 4,109.04482 1,043.48211
Index Trust 500 Fund 1,106.80110 1,051.84882
Star Fund 949.11309 1,046.72550
Bond Index Fund 1,579.38742 1,009.79463
Money Market Reserves 1,295.90220 1,012.99114
</TABLE>
<TABLE>
D. VESTING:
-------
The portion of an employee's participation in the Plan
attributable to the participant's own contributions, including
earnings thereon, vests immediately. Each participant's interest
in the Company's matching contributions vests under the following
schedule, based on years of service:
<CAPTION>
Nonforfeitable
Years of Service Percentage
---------------- --------------
<S> <C>
1 25%
2 50%
3 75%
4 100%
</TABLE>
Company matching contributions immediately vest if a participant
reaches age 65, becomes disabled or dies. Company contributions
forfeited during 1993 and 1992 were approximately $186,000 and
$414,000, respectively. During 1993 and 1992, accumulated
forfeitures were used to reduce Company contributions by $15,000
and $174,000, respectively.
As of December 31, 1993 and 1992, total accumulated forfeiture
balances were $737,000 and $420,000, respectively. These
forfeitures are being held pending reinstatements to rehired
employees.
Effective October 1, 1991, the Company no longer contributes
partnership shares to participants upon becoming a covered
employee. Effective July 1, 1993, these shares were no longer
allowed to be contributed to the Plan by employees.
6
<PAGE> 9
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
E. PAYMENT OF BENEFITS:
-------------------
A participant, former participant or beneficiary shall receive in
the form of a lump sum payment, the value of his or her account
payable in cash or Company common shares (if invested in the
Progressive Stock Fund at termination) as elected by the
participant. However, if a participant's entire account consists
of only the partnership share, the distribution shall be in cash.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
------------------------------------------
A. INVESTMENT VALUATION:
--------------------
The investment in Common Shares of The Progressive Corporation is
valued at the last reported trade price on the New York Stock
Exchange on the last business day of the year. Investments in the
Stein Roe & Farnham Stock Fund, Inc., Stein Roe Bond Fund, Inc.,
Vanguard Explorer Fund, Vanguard World Fund International Growth
Portfolio, Vanguard World Fund U.S. Growth Portfolio, Vanguard
Index Trust "500" Portfolio, Vanguard Star Fund and Vanguard Bond
Index Fund are valued at market. Investments in guaranteed
investment contracts issued by Vanguard and State Street Bank and
Vanguard Money Market Reserves Inc. Prime Portfolio and Stein Roe
Cash Reserves are valued at market, which approximates cost.
The Plan presents in the statement of changes in net assets
available for plan benefits the net appreciation (depreciation) in
the fair value of its investments which consists of the realized
gains or losses and the unrealized appreciation (depreciation) on
those investments.
B. BENEFITS PAYABLE:
----------------
Benefits payable represents the Plan's liability to separated
participants who elected a distribution for vested benefits and
participant withdrawals for which no distribution has been made
(see Note 8).
C. OTHER:
-----
Security transactions are recorded on a settlement date basis.
The use of a transaction or trade date basis would not have a
material effect on the overall financial position or results of
the Plan at December 31, 1993 or 1992.
Realized gains and losses on the sale of securities are determined
based on the average cost of the securities sold. Realized gains
and losses on the distribution of Company common shares are
determined based on the historical cost of the shares distributed.
Dividend income is recorded on the ex-dividend date. Interest and
other income are recorded as earned on the accrual basis.
Administrative expenses of the Plan, including trust management,
legal, and audit fees are paid by the Company and are not expenses
of the Plan. Investment management fees are expenses of the Plan
and are netted against interest income.
Certain amounts in the financial statements for 1992 were
reclassified to conform with the 1993 presentation.
7
<PAGE> 10
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
<TABLE>
3. INVESTMENT PROGRAMS:
-------------------
All of the Company's stock fund matching contributions are invested in
the common shares of the Company, and dividends paid are used to
purchase additional shares for the Plan.
Participants have the option of investing their contributions in
common shares of the Company, bond, stock and money market funds, a
guaranteed interest fund or any combination thereof. Income generated
from these funds is reinvested in the respective funds. At December
31, 1993 and 1992, there were 5,543 and 5,458 Plan participants,
respectively, with contributions in one or more of the following
funds:
<CAPTION>
Investment Options Number of Participants
------------------ ----------------------
1993 1992
---- -----
<S> <C> <C>
Company Common Shares 5,543 5,458
Stock Mutual Fund -- 1,338
Bond Mutual Fund -- 583
Money Market Mutual Fund -- 686
Guaranteed Interest Fund 1,849 2,349
Explorer Fund 514 --
International Growth Fund 444 --
US Growth Fund 1,434 --
Index Trust 500 Fund 642 --
Star Fund 636 --
Bond Index Fund 759 --
Money Market Reserves 664 --
<FN>
The total number of participants in the Plan is less than the sum of
the number of participants shown above because many were participating
in more than one fund.
</TABLE>
8
<PAGE> 11
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
<TABLE>
4. INVESTMENTS:
-----------
The Plan investments at December 31, were as follows:
(000's omitted except number of shares or units)
<CAPTION>
Number of
Shares or
1993 Units Cost Fair Value
---- ---------------- ---------- ------------
<S> <C> <C> <C>
Common Shares
-------------
The Progressive Corporation 2,283,702 $29,560 $92,490
---------- ------------
Other Investments
-----------------
State Street Bank
Selection Fund Contracts 7,872,374 7,872 7,872
Vanguard Variable GIC Fund 1,704,754 1,705 1,705
Vanguard Bond Index Fund 158,146 1,618 1,591
Vanguard Money Market
Reserves Inc. Prime Portfolio 1,271,254 1,271 1,271
---------- ------------
12,466 12,439
---------- ------------
Other Securities
----------------
Vanguard Explorer Fund 22,660 1,023 1,022
Vanguard World Fund International
Growth Portfolio 97,160 1,131 1,313
Vanguard World Fund US Growth Portfolio 289,424 4,214 4,321
Vanguard Index Trust "500" Portfolio 26,645 1,137 1,168
Vanguard Star Fund 73,901 1,004 991
---------- ------------
8,509 8,815
---------- ------------
TOTAL ASSETS HELD FOR INVESTMENT $50,535 $113,744
========== ============
1992
----
Common Shares
-------------
The Progressive Corporation 2,233,505 $25,432 $65,051
---------- ------------
Other Investments
-----------------
State Street Bank
Selection Fund Contracts 11,139,343 11,139 11,139
Stein Roe Cash Reserves 1,306,192 1,306 1,306
Stein Roe Bond Fund, Inc. 136,814 1,194 1,231
---------- ------------
13,639 13,676
---------- ------------
Other Securities
----------------
Stein Roe & Farnham
Stock Fund, Inc. 171,137 3,694 4,380
---------- ------------
TOTAL ASSETS HELD FOR INVESTMENT $42,765 $83,107
========== ============
<FN>
The number of Progressive Corporation shares at December 31, 1992 were adjusted
for a 3-for-1 stock split.
</TABLE>
9
<PAGE> 12
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
5. FEDERAL INCOME TAXES:
--------------------
The Company has received a determination from the Internal Revenue
Service (the "IRS") that the Plan is a qualified plan under applicable
sections of the Internal Revenue Code and is, therefore, exempt from
federal taxation under current tax laws.
6. RIGHT TO TERMINATE:
------------------
The Company expects to continue the Plan indefinitely, but reserves
the right at any time to alter, suspend, discontinue or terminate the
Plan at the discretion of the Company or upon disqualification by the
IRS. In the unlikely event the Plan is terminated, all assets in the
trust fund must be solely for distributions to Plan participants
except for employer contributions made within one year of the Plan
being disqualified by the IRS.
7. WORK-FORCE REDUCTION:
--------------------
During the first quarter of 1992, the Company implemented a work-force
reduction plan. As a result, approximately $7,600,000 of the net
assets available for Plan benefits at December 31, 1991 became
available for distribution in 1992 and years thereafter to certain
participants who were active in the Plan at December 31, 1991.
8. ACCOUNTING CHANGE:
-----------------
The American Institute of Certified Public Accountants "Audit and
Accounting Guide for Audits and Employee Benefit Plans, with
conforming changes as of May 1, 1993," no longer allows amounts
allocated to accounts of persons who have elected to withdraw from the
Plan but have not yet been paid as of the Plan's year-end to be
reflected as Plan liabilities in the Statement of Net Assets Available
for Plan Benefits. As a result, adoption of this guidance has been
reflected in the Plan's 1993 financial statements as a cumulative
effect of change in accounting principle, thereby increasing the Net
Assets Available for Plan Benefits and the Net Increase in Net Assets
Available for Plan Benefits at December 31, 1993 and the year then
ended by approximately $2,126,000. The amounts that would have been
reflected as benefits payable prior to this guidance by fund are as
follows:
Company Common Shares $ 82,000
Guaranteed Interest Fund 2,000
Explorer Fund 9,000
International Growth Fund 3,000
US Growth Fund 10,000
Index Trust 500 Fund 4,000
Star Fund 2,000
Bond Index Fund 1,000
Money Market Reserves 2,000
----------
Total $115,000
==========
10
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
9. RECONCILIATION WITH THE 5500:
----------------------------
Accounting guidance for financial statement presentation does not
allow amounts allocated to accounts of persons who have elected to
withdraw from the Plan but have not yet been paid as of the Plan's
year-end to be reflected as a Plan liability in the statement of net
assets available for Plan benefits. Instructions to Form 5500,
however, require presentation of the aforementioned amounts as Plan
liabilities at the Plan's year-end. As a result, lines 31 (g) and (k)
(end-of-year column) of the Form 5500 exceed those amounts reflected
in the financial statements by $115,135.
10. ASSET ALLOCATION:
----------------
The allocation of net assets and changes in net assets for the
separate investment programs follows on pages 12 through 15.
11
<PAGE> 14
<TABLE>
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
10. Asset Allocation, continued
---------------------------
ALLOCATION OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
TO INVESTMENT PROGRAMS
December 31, 1993
(000's omitted)
<CAPTION>
Money
Progressive Stock Bond Market Guaranteed International
Stock Mutual Mutual Mutual Interest Loan Explorer Growth
Fund Fund Fund Fund Fund Fund Fund Fund
-------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS
------
Investments, at fair value:
Progressive Corporation
common shares $92,490 $ -- $ -- $ -- $ -- $ -- $ -- $ --
Other investments -- -- -- -- 9,577 -- -- --
Other securities -- -- -- -- -- -- 1,022 1,313
-------------------------------------------------------------------------------------------
92,490 -- -- -- 9,577 -- 1,022 1,313
-------------------------------------------------------------------------------------------
Receivables:
Employer's contribution 158 -- -- -- -- -- -- --
Participants' contributions 203 -- -- -- 40 -- 14 13
Participants' loans -- -- -- -- -- 2,720 -- --
Accrued interest and
dividends -- -- -- -- 65 -- -- --
-------------------------------------------------------------------------------------------
361 -- 105 2,720 14 13
-------------------------------------------------------------------------------------------
Cash and cash equivalents 579 -- -- -- 247 -- -- --
-------------------------------------------------------------------------------------------
Total assets 93,430 -- -- -- 9,929 2,720 1,036 1,326
-------------------------------------------------------------------------------------------
LIABILITIES
-----------
Benefits payable (Note 8) -- -- -- -- -- -- -- --
Interfund payable/(receivable) 64 -- -- -- -- -- (4) (31)
-------------------------------------------------------------------------------------------
Total liabilities 64 -- -- -- -- -- (4) (31)
-------------------------------------------------------------------------------------------
Net Assets Available for
Plan Benefits $93,366 $ -- $ -- $ -- $9,929 $2,720 $1,040 $1,357
===========================================================================================
<CAPTION>
Index
US Trust Bond Money
Growth 500 Star Index Market Total
Fund Fund Fund Fund Reserves Plan
------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
ASSETS
------
Investments, at fair value:
Progressive Corporation
common shares $ -- $ -- $ -- $ -- $ -- $92,490
Other investments -- -- -- 1,591 1,271 12,439
Other securities 4,321 1,168 991 -- -- 8,815
------------------------------------------------------------
4,321 1,168 991 1,591 1,271 113,744
------------------------------------------------------------
Receivables:
Employer's contribution -- -- -- -- -- 158
Participants' contributions 41 19 18 15 8 371
Participants' loans -- -- -- -- -- 2,720
Accrued interest and
dividends -- -- -- -- 1 66
------------------------------------------------------------
41 19 18 15 9 3,315
------------------------------------------------------------
Cash and cash equivalents -- -- -- -- -- 826
------------------------------------------------------------
Total assets 4,362 1,187 1,009 1,606 1,280 117,885
------------------------------------------------------------
LIABILITIES
-----------
Benefits payable (Note 8) -- -- -- -- -- --
Interfund payable/(receivable) 23 -- (4) (5) (43) --
------------------------------------------------------------
Total liabilities 23 -- (4) (5) (43) --
------------------------------------------------------------
Net Assets Available for
Plan Benefits $4,339 $1,187 $1,013 $1,611 $1,323 $117,885
============================================================
</TABLE>
12
<PAGE> 15
<TABLE>
NOTES TO FINANCIAL STATEMENTS, CONTINUED
---------
10. Asset Allocation, continued
---------------------------
ALLOCATION OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
TO INVESTMENT PROGRAMS
December 31, 1992
(000's omitted)
<CAPTION>
Money
Progressive Stock Bond Market Guaranteed
Stock Mutual Mutual Mutual Interest Loan Total
Fund Fund Fund Fund Fund Fund Plan
--------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
ASSETS
------
Investments, at fair value:
Progressive Corporation
common shares $65,051 $ -- $ -- $ -- $ -- -- $65,051
Other investments -- -- 1,231 1,306 11,139 -- 13,676
Other securities -- 4,380 -- -- -- -- 4,380
--------------------------------------------------------------------------------------------
65,051 4,380 1,231 1,306 11,139 -- 83,107
--------------------------------------------------------------------------------------------
Receivables:
Employer's contribution 71 -- -- -- -- -- 71
Participants' contributions 79 33 7 4 68 -- 191
Participants' loans -- -- -- -- -- 1,629 1,629
Accrued interest and
dividends 1 -- -- -- 190 -- 191
--------------------------------------------------------------------------------------------
151 33 7 4 258 1,629 2,082
--------------------------------------------------------------------------------------------
Cash and cash equivalents 415 1 1 1 7 -- 425
--------------------------------------------------------------------------------------------
Total assets 65,617 4,414 1,239 1,311 11,404 1,629 85,614
--------------------------------------------------------------------------------------------
LIABILITIES
-----------
Benefits payable 1,597 107 15 86 321 -- 2,126
--------------------------------------------------------------------------------------------
Net Assets Available for
Plan Benefits $64,020 $4,307 $1,224 $1,225 $11,083 $1,629 $83,488
============================================================================================
</TABLE>
13
<PAGE> 16
<TABLE>
NOTES TO FINANCIAL STATEMENTS, CONTINUED
10. Asset Allocation, continued
---------------------------
ALLOCATION OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
TO INVESTMENT PROGRAMS
December 31, 1993
(000's omitted)
<CAPTION>
Money
Progressive Stock Bond Market Guaranteed International
Stock Mutual Mutual Mutual Interest Loan Explorer Growth
Fund Fund Fund Fund Fund Fund Fund Fund
---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Additions to Net Assets
Attributed to:
Net appreciation in fair value
of Progressive Corporation
common shares $25,374 $ -- $ -- $ -- $ -- $ -- $ -- $ --
Net appreciation
(depreciation) in fair
value of other investments -- -- 38 -- -- -- -- --
Net appreciation
(depreciation) in fair
value of other securities -- (197) -- -- -- -- 106 187
Dividends on Progressive
Corporation common shares 448 -- -- -- -- -- -- --
Interest and other dividends 10 7 49 18 718 164 3 11
---------------------------------------------------------------------------------------------
25,832 (190) 87 18 718 164 109 198
---------------------------------------------------------------------------------------------
Contributions:
Employer 3,910 -- -- -- -- -- -- --
Participants 4,721 893 191 111 1,601 -- 171 147
---------------------------------------------------------------------------------------------
8,631 893 191 111 1,601 -- 171 147
---------------------------------------------------------------------------------------------
Total additions 34,463 703 278 129 2,319 164 280 345
---------------------------------------------------------------------------------------------
Deductions from Net Assets
Attributed to:
Benefits paid to participants (6,373) (251) (64) (114) (965) (197) (15) (4)
Cumulative effect of change
in accounting principle 1,597 107 15 86 321 -- -- --
Interfund transfers (341) (4,866) (1,453) (1,326) (2,829) 1,124 775 1,016
---------------------------------------------------------------------------------------------
Net increase (decrease) 29,346 (4,307) (1,224) (1,225) (1,154) 1,091 1,040 1,357
Net Assets Available for Plan
Benefits:
Beginning of year 64,020 4,307 1,224 1,225 11,083 1,629 -- --
---------------------------------------------------------------------------------------------
End of year $93,366 $ -- $ -- $ -- $ 9,929 $2,720 $1,040 $1,357
=============================================================================================
<CAPTION>
Index
US Trust Bond Money
Growth 500 Star Index Market Total
Fund Fund Fund Fund Reserves Plan
-------------------------------------------------------------------
<C> <C> <C> <C> <C> <C>
Additions to Net Assets
Attributed to:
Net appreciation in fair value
of Progressive Corporation
common shares $ -- $ -- $ -- $ -- $ -- $25,374
Net appreciation
(depreciation) in fair
value of other investments -- -- -- (24) -- 14
Net appreciation
(depreciation) in fair
value of other securities 120 33 19 -- -- 268
Dividends on Progressive
Corporation common shares -- -- -- -- -- 448
Interest and other dividends 60 17 15 39 17 1,128
-------------------------------------------------------------------
180 50 34 15 17 27,232
Contributions: -------------------------------------------------------------------
Employer -- -- -- -- -- 3,910
Participants 658 265 237 202 119 9,316
-------------------------------------------------------------------
658 265 237 202 119 13,226
-------------------------------------------------------------------
Total additions 838 315 271 217 136 40,458
-------------------------------------------------------------------
Deductions from Net Assets
Attributed to:
Benefits paid to participants (88) (10) (21) (34) (51) (8,187)
Cumulative effect of change
in accounting principle -- -- -- -- -- 2,126
Interfund transfers 3,589 882 763 1,428 1,238 --
-------------------------------------------------------------------
Net increase (decrease) 4,339 1,187 1,013 1,611 1,323 34,397
Net Assets Available for Plan
Benefits:
Beginning of year -- -- -- -- -- 83,488
-------------------------------------------------------------------
End of year $4,339 $1,187 $1,013 $1,611 $1,323 $117,885
===================================================================
</TABLE>
14
<PAGE> 17
<TABLE>
NOTES TO FINANCIAL STATEMENTS, CONTINUED
--------
10. Asset Allocation, continued
---------------------------
ALLOCATION OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
TO INVESTMENT PROGRAMS
for the year ended December 31, 1992
(000's omitted)
<CAPTION>
Money
Progressive Stock Bond Market Guaranteed
Stock Mutual Mutual Mutual Interest Loan Total
Fund Fund Fund Fund Fund Fund Plan
----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Additions to Net Assets Attributed to:
Investment income:
Net appreciation in fair
value of Progressive Corporation
common shares $ 24,991 $ -- $ -- $ -- $ -- $ -- $24,991
Net (depreciation) in fair
value of other investments -- -- (3) -- -- -- (3)
Net appreciation in fair
value of other securities -- 323 -- -- -- -- 323
Dividends on Progressive
Corporation common shares 434 -- -- -- -- -- 434
Interest and other dividends 12 24 77 46 753 134 1,046
----------------------------------------------------------------------------------------------
25,437 347 74 46 753 134 26,791
----------------------------------------------------------------------------------------------
Contributions:
Employer 3,447 -- -- -- -- -- 3,447
Participants 3,672 1,559 311 244 2,258 -- 8,044
----------------------------------------------------------------------------------------------
7,119 1,559 311 244 2,258 -- 11,491
----------------------------------------------------------------------------------------------
Total additions 32,556 1,906 385 290 3,011 134 38,282
----------------------------------------------------------------------------------------------
Deductions from Net Assets
Attributed to:
Benefits paid to participants (9,467) (610) (147) (307) (2,439) (328) (13,298)
Interfund Transfers (681) 273 90 (90) 186 222 --
----------------------------------------------------------------------------------------------
Net increase (decrease) 22,408 1,569 328 (107) 758 28 24,984
Net Assets Available for
Plan Benefits
Beginning of year 41,612 2,738 896 1,332 10,325 1,601 58,504
----------------------------------------------------------------------------------------------
End of year $64,020 $4,307 $1,224 $1,225 $11,083 $1,629 $83,488
=============================================================================================
</TABLE>
15
<PAGE> 18
<TABLE>
THE PROGRESSIVE CORPORATION LONG-TERM SAVINGS PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
for the year ended December 31, 1993
<CAPTION>
IDENTITY OF ISSUE, DESCRIPTION OF INVESTMENT INCLUDING
BORROWER, LESSOR, MATURITY DATE, RATE OF INTEREST,
OR SIMILAR PARTY COLLATERAL, PAR OR MATURITY VALUE COST CURRENT VALUE
-------------------- --------------------------------- ------------ -------------
<S> <C> <C> <C>
The Progressive 2,283,702 Progressive Corporation Common Stock $29,560,203 $92,489,931
Corporation*
State Street Bank 7,872,374 shares of State Street Bank selection Fund
1991-J2 various contracts 7,872,374 7,872,374
Vanguard 1,704,754 shares of Vanguard Variable GIC Fund 1,704,754 1,704,754
Vanguard 158,146 shares of Vanguard Bond Index Fund 1,617,798 1,590,950
Vanguard 1,271,254 shares of Vanguard Money Market
Reserves, Inc. 1,271,254 1,271,254
Vanguard 22,660 shares of Vanguard Explorer Fund 1,022,727 1,022,200
Vanguard 97,160 shares of Vanguard World Fund
International Growth Portfolio 1,130,692 1,312,634
Vanguard 289,424 shares of Vanguard World Fund US Growth
Portfolio 4,214,455 4,321,100
Vanguard 26,645 shares of Vanguard Index Trust 500 1,136,864 1,167,838
Vanguard 73,901 shares of Vanguard Star Fund 1,003,544 991,013
<FN>
* Indicates party-in-interest to the Plan.
</TABLE>
16
<PAGE> 19
<TABLE>
THE PROGRESSIVE CORPORATION LONG-TERM SAVINGS PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
for the year ended December 31, 1993
<CAPTION>
IDENTITY OF ISSUE, DESCRIPTION OF INVESTMENT INCLUDING
BORROWER, LESSOR, MATURITY DATE, RATE OF INTEREST, COST OF PROCEEDS OF
OR SIMILAR PARTY COLLATERAL, PAR OR MATURITY VALUE ACQUISITIONS DISPOSITIONS
------------------- ------------------------------------------ ------------ ------------
<S> <C> <C> <C>
The Progressive Corporation* 139,001 shares of Common Stock $ 4,959,656
The Progressive Corporation* 40,400 shares of Common Stock $ 1,383,102
National Bank of Detroit 26,711,887 shares of short-term investment fund 26,711,887
National Bank of Detroit 26,301,884 shares of short-term investment fund 26,301,884
State Street Bank 789,831 shares of selection fund various
contracts 789,831
State Street Bank 4,056,800 shares of selection fund various
contracts 4,056,800
Stein Roe & Farnham 19,487 shares of Intermediate Bond Fund 179,340
Stein Roe & Farnham 156,300 shares of Intermediate Bond Fund 1,448,901
Stein Roe & Farnham 29,689 shares of Mutual Stock Fund 729,371
Stein Roe & Farnham 200,826 shares of Mutual Stock Fund 4,912,061
Stein Roe & Farnham 37,501 shares of Cash Reserves 37,501
Stein Roe & Farnham 1,343,693 shares of Cash Reserves 1,343,676
Vanguard 4,223,559 shares of the Variable GIC Fund 4,223,559
Vanguard 2,518,805 shares of the Variable GIC Fund 2,518,805
Vanguard 23,689 shares of the Explorer Fund 1,069,032
Vanguard 1,029 shares of the Explorer Fund 49,399
Vanguard 103,365 shares of the World International
Growth Portfolio 1,200,695
Vanguard 6,205 shares of the World International Growth
Portfolio 75,325
Vanguard 354,817 shares of the World US Growth Portfolio 5,164,238
Vanguard 65,393 shares of the World US Growth Portfolio 963,237
Vanguard 27,931 shares of the Index Trust 500 Portfolio 1,191,482
Vanguard 1,287 shares of the Index Trust 500 Portfolio 56,257
Vanguard 82,217 shares of the Star Fund 1,115,809
Vanguard 8,316 shares of the Star Fund 115,395
Vanguard 199,426 shares of the Bond Index Fund 2,040,067
Vanguard 41,280 shares of the Bond Index Fund 425,188
Vanguard 1,473,736 shares of the Money Market Reserves
Prime Portfolio 1,473,736
Vanguard 202,482 shares of the Money Market Reserves
Prime Portfolio 202,482
<FN>
* Indicates party-in-interest to the Plan.
</TABLE>
17
<PAGE> 20
<TABLE>
THE PROGRESSIVE CORPORATION LONG-TERM SAVINGS PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
for the year ended December 31, 1993
The following schedule represents Plan transactions or series of transactions in excess of 5% of current value of Plan assets for
the year ended December 31, 1993.
<CAPTION>
Transactions/ Face Value/ Purchased/ Sold/
Description Shares Date Cost Contributed Distributed
----------- ------------- ---- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Purchases of The
Progressive Corporation*
Common Shares (21 transactions) 139,001 Various $4,959,656 $4,959,656
Sales of Stein Roe Equity Trust Fund
(2 transactions) 200,826 Various 4,423,346 $ 4,912,061**
Purchases of National
Bank of Detroit
Short-Term Investment
Fund (334 transactions) 26,711,887 Various 26,711,887 26,711,887
Sales of National
Bank of Detroit
Short-Term Investment
Fund (315 transactions) 26,301,884 Various 26,301,884 26,301,884
Purchases of Vanguard Variable GIC Fund
(27 transactions) 4,223,559 Various 4,223,559 4,223,559
Purchases of Vanguard World US Growth Portfolio
(23 transactions) 354,817 Various 5,164,238 5,164,238
<FN>
* Indicates party-in-interest to the Plan.
** Net gain on sales totals $488,715.
NOTE: There is no separate determination of expenses related to the above transactions.
</TABLE>
18
<PAGE> 21
SIGNATURES
THE PLAN. Pursuant to the requirements of the Securities Exchange Act
of 1934, the plan has duly caused this annual report to be signed on its behalf
by the undersigned hereunto duly authorized.
Progressive Casualty Insurance Company, as
Administrator of The Progressive Corporation
Long-Term Savings Plan
By:/s/ David M. Schneider
------------------------
David M. Schneider
Secretary
June 27, 1994
<PAGE> 22
THE PROGRESSIVE CORPORATION
LONG-TERM SAVINGS PLAN
EXHIBIT INDEX
-------------
EXHIBIT NO. FORM 11-K
UNDER REG. EXHIBIT
S-K, ITEM 601 NO. DESCRIPTION OF EXHIBIT
- - ------------- ------- ----------------------
23 1 Consent of Coopers & Lybrand,
Independent Accountants, to
incorporate by reference
their report dated June 24,
1994.
99-P 2 1993 Annual Return/Report of
Employee Benefit Plan
(Department of the Treasury
Form 5500) for the Plan
<PAGE> 1
EXHIBIT NO. 1
-------------
Consent of Coopers & Lybrand,
Independent Accountants,
to incorporate by reference
their report dated June 24, 1994
<PAGE> 2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statements of
The Progressive Corporation on Form S-8 (Registration No. 33-16509 and
33-51034) of our report dated June 24, 1994, on our audits of the financial
statements and supplemental schedules of The Progressive Corporation Long-Term
Savings Plan as of December 31, 1993 and 1992, and for the years then ended,
which report is included in this Annual Report on Form 11-K.
COOPERS & LYBRAND
Cleveland, Ohio
June 27, 1994
