Progressive car insurance adds pet coverage

For no additional charge $500 benefit will be paid if animal is hurt or dies

updated 12:15 p.m. ET, Mon., Nov. 12, 2007

CLEVELAND - Progressive Corp. is providing collision coverage for
customers' dogs or cats at no additional premium cost. It will pay up
to $500 if a customer's dog or cat is hurt or dies in a car accident.

"It's an unusual and interesting benefit," said Jean Salvatore, a
senior vice president for the New York-based Insurance Information
Institute. She was not aware of any other company offering a collision
benefit for pets.

"Auto insurance is a very competitive market, and companies are always
looking for ways to differentiate themselves. If this becomes popular,
I'm sure others may look into it as well," Salvatore said.

There are over 150 million pets in the U.S., and Americans spend over
$40 billion on their pets annually, according to a recent Insurance
Information Institute study.

The Progressive benefit has been in place since Sept. 6, and it's
still too soon to determine if the company's undetermined cost of
offering it will be offset by better sales, Progressive spokeswoman
Leah Knapp said.

Auto insurance generally provides property, liability and medical coverage.

Typically, an insured person's collision coverage pays for the damage
to the insured's vehicle in a collision or other kind of accident,
such as when a driver loses control and a car overturns. But usually
there's no payment for pets who may be in the car.

Liability coverage would kick in for any pets hurt in a car other than
the insured's.

The new Progressive benefit is not pet insurance, which some people
obtain to help them pay veterinarian costs.

A Progressive strategist said the company saw a pets benefit as an
auto insurance market opportunity.

"We found no coverage that was even similar to it," said Geoff Souser,
Progressive product manager for auto insurance. "We have pets, too,
and we know how important they are to our families. We are always
looking for new and different ways of delivering value to our
customers, and this seemed like a logical extension."

Progressive is the third-biggest auto insurer, ranking behind State
Farm and Allstate and slightly ahead of National Indemnity (Berkshire
Hathaway), which includes GEICO.

State Farm and Allstate confirmed a pets benefit is not in the
collision part of their policies. A message was left with a GEICO
spokeswoman.

Progressive's pet benefit is available in 46 states and the District
of Columbia; it's not yet available in North Carolina, New Hampshire,
New York and Virginia, but the company hopes to offer it in those
states soon.