Progressive Corp. boosted its advertising spending by nearly $70 million year over year to $595.4 million in 2013, the largest aggregate dollar increase among all U.S. property/casualty insurers, according to an analysis by SNL Financial.
Though Progressive had the biggest dollar amount increase in ad spending in 2013, GEICO spent about twice the amount Progressive did on advertising and the most of any P/C carrier.
Progressive’s most used television ad campaign centers on the character Flo, a perky spokesperson who interacts with potential customers in a variety of ways. Flo has been featured in ads for several years. While Progressive has been looking at other advertising themes, the company has no plans to discontinue its most recognizable ad theme, according to its most recent Form 10-Q.
According to SNL, GEICO’s 2013 ad spend of $1.18 billion surpassed the spending of any U.S. P/C insurer. Fellow personal lines giants Allstate Corp. and State Farm Mutual Automobile Insurance Co. ranked second and third, respectively, in advertising costs in 2013. The top three rankings were the same in 2012.
GEICO, with its Gecko and Maxwell the pig mascots, has been the leader in advertising spendingamong U.S. P/C insurers for at least five years through 2013, according to SNL. In 2013, GEICO grew its advertising by only 5 percent, but it is still the only company that spends more than $1 billion annually on advertising. Its $1.18 billion in ad spend in 2013 was up from $1.12 billion in 2012.
SNL examined the advertising expense amounts reported by all combined entities and insurance companies not included in a combined filing. SNL uses its aggregate of the GEICO Corp. subgroup in lieu of the National Indemnity Co. combined statement because GEICO advertising represents more than 99 percent of all National Indemnity advertising. Using GEICO shows statistics more focused on the lead advertiser in the group, according to SNL.
Numbers included in the SNL chart are on a statutory basis and reflect historical advertising reported by the entities at the end of each year. The figures are not pro forma for the companies’ corporate structures as of Dec. 31, 2013. SNL calculates the ratio of ad spend to premium using only personal lines premium because most television commercials appear to be for personal auto and homeowners for individual consumers. However, this may not be true for every company listed, with American International Group Inc. being the most notable exception.