Progressive 2015 Annual Report Download - page 39

The aggregate fair value of the restricted stock vested, during the years ended December 31, 2015, 2014, and 2013, was
$2.2 million, $2.2 million, and $2.3 million, respectively, based on the actual stock price at time of exercise/vesting.
Deferred Compensation The Progressive Corporation Executive Deferred Compensation Plan (Deferral Plan) permits
eligible Progressive executives to defer receipt of some or all of their annual bonuses and all of their annual equity awards.
Deferred cash compensation is deemed invested in one or more investment funds, including Progressive common shares,
offered under the Deferral Plan and elected by the participant. All Deferral Plan distributions attributable to deferred cash
compensation will be paid in cash.
For all equity awards granted in or after March 2005, and deferred pursuant to the Deferral Plan, the deferred amounts are
deemed invested in our common shares and are ineligible for transfer to other investment funds in the Deferral Plan;
distributions of these deferred awards will be made in Progressive common shares. For all restricted stock awards granted
prior to that date, the deferred amounts are eligible to be transferred to any of the investment funds in the Deferral Plan;
distributions of these deferred awards will be made in cash. We reserved 11.1 million of our common shares for issuance
under the Deferral Plan. An irrevocable grantor trust has been established to provide a source of funds to assist us in
meeting our liabilities under the Deferral Plan.
The Deferral Plan Irrevocable Grantor Trust account held the following assets at December 31:
(millions) 2015 2014
Progressive common shares1$108.5 $ 83.2
Other investment funds2124.8 123.9
Total $233.3 $207.1
1Includes 4.4 million and 3.6 million common shares as of December 31, 2015 and 2014, respectively, to be distributed in common shares.
2Amount is included in other assets on the balance sheet.
10. SEGMENT INFORMATION
We write personal and commercial auto and property insurance and other specialty property-casualty insurance and provide
related services. Our Personal Lines segment writes insurance for personal autos and recreational vehicles. The Personal
Lines segment is comprised of both the Agency and Direct businesses. The Agency business includes business written by
our network of more than 35,000 independent insurance agencies, including brokerages in New York and California, and
strategic alliance business relationships (other insurance companies, financial institutions, and national agencies). The
Direct business includes business written directly by us online, by phone, or on mobile devices. We operate our personal
auto businesses throughout the United States and sell personal auto physical damage and auto property damage liability
insurance in Australia. For the years ended December 31, 2015, 2014, and 2013, net premiums earned on our Australian
business were $15.9 million, $17.1 million, and $13.0 million, respectively.
Our Commercial Lines segment writes primary liability and physical damage insurance for automobiles and trucks owned
and/or operated predominantly by small businesses in the business auto, for-hire transportation, contractor, for-hire
specialty, tow, and for-hire livery markets. This segment operates in 49 states and is distributed through both the
independent agency and direct channels.
Our Property segment writes insurance for homeowners, other property owners, and renters primarily through the
independent agency channel in 31 states and the District of Columbia for personal property and in 4 states for commercial
property as of December 31, 2015 (flood insurance is written in 37 states and D.C.). Our Property business primarily
consists of the operations of ARX, in which we acquired a controlling interest in the second quarter of 2015.
Our other indemnity businesses manage our run-off businesses, including the run-off of our professional liability insurance
for community banks.
Our service businesses provide insurance-related services, including processing CAIP business, and serving as an agent
for homeowners, general liability, and workers’ compensation insurance through our programs with American Strategic
Insurance and other subsidiaries of ARX (ASI), and unaffiliated insurance companies.
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