By market share, Progressive may be the third-largest auto insurer, behind State Farm and Allstate. But by other measures it's a leader. Progressive's return on capital is 23.6% over the past year, while earnings per share grew an average of 23.7% for the last five years. One reason: Progressive is constantly trying to find better ways to do things. "We have a high tolerance for innovation and experimentation," says Glenn M. Renwick, its chief executive. It was the first auto insurer to use credit scores when pricing its policies. It's now standard practice. Progressive is also innovative with claims management. A damaged vehicle is brought to a Progressive service center. Within minutes the policyholder is given a pager and keys to a rental car. The customer is paged after the vehicle has been repaired by a local body shop. No waiting for an adjuster; the driver isn't responsible for getting repairs done. The customer saves time, and Progressive saves money on storage and rental car costs.
Next:Progressive is testing a new program in which achip is connected to a vehicle's diagnosis port. Data on how often and how fast it is driven is collected and analyzed. Good driving habits can earn a policyholder a discount of up to 25% at renewal time.
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