Progressive 2009 Annual Report Download - page 13

on our Information Technology Group’s process agenda
to re-think just about every aspect of what we do and how
we do it, I expressed an expectation that their efforts would
result in increased leverage and greater accountability
to market priorities. Suffice it to say that through terrific
commitment by the whole organization, expectations are
being met. Our expected IT spending level for 2010 is
lower than the comparable number for 2006. Of special
note, our multi-year effort to develop a replacement for
our policy processing system went live in its first state
during the year, with excellent quality.
Changing things that work because there is a better
way is difficult and requires a special mindset and leader-
ship. Relentlessly improving our products and services
and providing reasons for customers to stay, in addition to
eliminating reasons they leave, is never ending. Innovat-
ing in ways that matter to customers, and better defining
target segments and our appeal to each, is exciting. This
is what we do. I like the changes we’ve made and am gen-
uinely excited about the prospects for 2010. We remain
continuously motivated by our aspiration of becoming
Consumers’ #1 Choice for Auto Insurance.
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the costs than the attainment of benefits. For our Claims or-
ganization, 2009 was a year in which many of the intended
benefits from nearly a decade of continuous improvement
in claims response and accuracy were fully realized.
We ended the year with our run rate Loss Adjustment
Expense ratio approximately one point lower than the
prior year, improved on what was already our highest
attained quality of settlement measure, and added con-
siderable emphasis to our focus on employee and customer
satisfaction expecting future measures to reflect the
efforts. Key to success is attaining the delicate balance
between all four guiding principles; however, a point of
LAE re duction, with a very realistic goal of more, helps in
no small
way to keep our prices lower longer and below
external trends wherever possible. It is certainly not out
of place to extend a special recognition to the11,500 claims
employees who, through their patience, flexibility, open-
ness, and nimbleness in the midst of some substantial
changes, made these results possible.
Focus on non-claims costs is every bit as important to
increasing market competitiveness. While on a relative
basis, we may be very good, we see opportunity and we’re
going after it in ways that count. Last year, commenting
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