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Survey Reveals Drivers Don’t Understand That the Choices They Make When Buying or Leasing a New Vehicle Can Influence Their Auto Insurance Rates

New Car Season Is Here; Do You Know What Vehicle Characteristics Affect Auto Insurance Rates?

MAYFIELD VILLAGE, Ohio — September 30, 2002 —Progressive.com, the Web site of Progressive Insurance (NYSE: PGR), has been named "Best Insurance Website" in the Web Marketing Association's (WMA) 2002 WebAward Competition based on an expert panel's review of criteria including innovation, navigation, interactivity, content, ease of use and usefulness to target audience. More than 1,300 sites were judged in the competition.

With the 2003 models debuting, a survey from Progressive reveals that many drivers don't realize that the decisions they make about their new vehicle can also affect the cost of their auto insurance.

According to the online survey by Progressive (NYSE: PGR), whose companies comprise one of the country's largest auto insurance groups, more than one in ten consumers think that the cost of auto insurance would be about the same regardless of the type of car they purchase or lease. And while 37 percent of consumers said they plan to purchase/lease a new vehicle in the next 12 months , many were unsure of what vehicle variables impact their auto insurance rate.

The survey found that consumers believe that vehicle color (42 percent of consumers), sunroofs (29 percent of consumers), tinted windows (26 percent of consumers) and stereo speakers (12 percent of consumers) influenced rates. The fact is none of these directly affect auto insurance rates at most companies.

However, when it comes to which vehicle characteristics do influence insurance rates, the survey found that many consumers did not realize that the weight of the vehicle (37 percent of consumers), the cost of the vehicle (16 percent of consumers), the body type, that is, four-door versus two-door (11 percent) and whether or not the vehicle is a convertible (nine percent) can play a role in determining rates. In general, the more expensive the vehicle and the heavier the vehicle, the more it can cost to insure. In addition, two-door vehicles, including convertibles, can also cost more to insure than four-door sedans.

"Auto insurance companies are in the business of predicting future losses or accidents. They use information about you, your vehicle and the accident experience of customers like you to calculate a price that will cover the cost of those future accidents. And because each company has had slightly different experiences with drivers and accidents, prices will vary from company to company. So if you're buying or leasing a new car, shop around for auto insurance," said Toby Alfred, site manager, progressive.com. "We surveyed consumers to see what vehicle characteristics they think affect rates to use that information to help them better understand what really affects rate and to let them know that they can help control the cost of their auto insurance through their vehicle choices."

In order to understand what consumers consider when buying or leasing a new vehicle, the survey also asked what they thought to be the most important factor when buying/leasing a new vehicle. Eighteen (18) percent of consumers said vehicle performance and 12 percent said it's important to buy a vehicle that reflects a lifestyle (family, single, sporty). Also, women (23 percent) were more interested in safety features than men (13 percent), while men (23 percent) were nearly twice as likely than women (12 percent) to list vehicle performance as a primary factor.

When asked what safety-related or environmentally friendly options they would be willing to pay more for, 39 percent of consumers said they would pay more for a vehicle that ran on electric or solar power and 67 percent would pay more for a vehicle that warned them another vehicle was in their blind spot. Also, consumers said they would pay more for a vehicle that had better fuel efficiency (84 percent) or woke them up if they fell asleep behind the wheel (44 percent).

The Progressive group of insurance companies, in business since 1937, ranks fourth in the nation for auto insurance and provides drivers with competitive rates and 24/7, in-person service. The companies offer insurance by phone at 1-800-PROGRESSIVE, online at progressive.com and through more than 30,000 independent insurance agencies. The Progressive Corporation, the holding company, has headquarters in Mayfield Village, Ohio. More information can be found at progressive.com.

Tips for buying a new car and the latest full-motion video crash test footage and analysis from the Insurance Institute for Highway Safety (IIHS) can be found on www.progressive.com.

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Toby Alfred is available for interview.
For assistance in setting up an interview,
contact our Media Relations Department.

Did You Know...

According to a countrywide survey by progressive.com

Looking for a New One
Thirty-seven (37) percent of consumers said they plan to purchase/lease a new vehicle in the next 12 months.

Number One Consideration?
Consumers were asked to rank what they consider most important when purchasing/leasing a new vehicle:

Number One Consideration
Cost (purchase price, fuel, insurance, etc.)	38%
Safety	18%
Performance (handling, speed, etc.)	18%
Lifestyle (family, single, sporty, etc.)	12%
Savings (incentives, rebates, etc.)	6%
Status (image the car projects on owner)	4%
Dealership location	3%

Mars Versus Venus ... What Do We Look For In New Vehicles?When asked what they consider when purchasing/leasing a new vehicle, women (23 percent) were more interested in safety features than men (13 percent), while men (23 percent) were nearly twice as likely than women (12 percent) to list performance as a primary factor.

Costly Decision
When asked to rank the costs associated with buying or leasing a new vehicle, only eight (8) percent of consumers considered the "cost to insure" the most important, with men (11 percent) twice as likely than women (five percent) to consider it to be most important.

Do You Shop?
Only 28 percent of consumers always shop around to compare auto insurance rates when purchasing/leasing a new vehicle. Fifty-nine (59) percent use the same auto insurance carrier they had previously when they purchase or lease a new vehicle.

Small Thinking
Thirteen (13) percent of consumers think that the cost of auto insurance would be about the same regardless of the type of car purchased or leased. And 22 percent of people would purchase or lease a smaller vehicle over a larger one if they knew they would pay less for auto insurance.

Size Doesn't Matter
Eighty-two (82) percent of consumers would still consider buying a large truck, and 67 percent would still consider buying an extra large SUV even if it cost more to insure than a mid-sized sedan, minivan or compact car.

What Affects Your Rate?
Consumers incorrectly thought that vehicle color (42 percent) and whether or not the vehicle had a sunroof (29 percent) affected insurance rates. Also, tinted windows (26 percent) and stereo speakers (12 percent) were mistakenly thought to influence auto insurance rates.

The survey also found consumers did not realize that the weight of the vehicle (37 percent of consumers), the cost of the vehicle (16 percent of consumers), the body type, that is, four-door versus two-door (11 percent) and whether or not the vehicle is a convertible (nine percent) can play a role in determining rates.

Style Over Safety?
When asked which consideration was more important when purchasing/leasing a new vehicle, consumers said the following:

• Thirty-two (32) percent chose cooled/heated seats over run-flat tires.
• Sixty-six (66) percent chose an upgraded stereo/sound system over one touch 911 dialing — although women (42 percent) much more likely than men (27 percent) to choose one touch 911 dialing.
• Thirteen (13) percent chose video entertainment over side impact air bags — with men more than twice as likely to want the entertainment system than women (18 percent versus seven percent).
• Ten (10) percent chose in-vehicle Internet/email over anti-theft devices.
• Forty-five (45) percent chose satellite radio over adjustable pedals.
• Thirty-seven (37) percent chose leather seats over side-window security glass.

Driving With Influence
When deciding which model/type of vehicle to purchase or lease, 59 percent of people said the cost of auto insurance is "somewhat influential" while 20 percent said the cost of auto insurance is "not at all" influential.

New Car Behavior
Seventeen (17) percent of consumers said they would eat/drink less when driving a newly-purchased/leased vehicle, 19 percent said they would not alter their driving habits at all, while six percent each reported they would refrain from speeding and tailgating.

Would You Pay More For This?
When asked which of the following options they'd pay more for in a new or leased vehicle, consumers said they'd pay more for a vehicle that:

Benefit
Ran on electric or solar power	39%
Had better fuel efficiency	84%
Warned them when another vehicle was in blind spot	67%
Woke them up if fell asleep behind wheel	44%
Wouldn't start if driver drinking alcohol	36%
Never needed an oil change	69%
Never got a flat tire	73%
Automatically buckled everyone up in the car	44%

What Leads To Purchase
When asked to choose what incentive would most likely make one consider buying/leasing a new car, consumers said:

Incentive
Zero percent financing	53%
Paying less for auto insurance	19%
Cash back from dealer	9%
Other dealer promotions	3%

Haggling Online?
Eighty-four (84) percent of consumers said they would be "very likely" to compare new vehicle prices online.

Shopping For Auto Insurance
Fifty-three (53) percent said they would be "very likely" to compare auto insurance prices online or directly with an auto insurance company, while an additional 29 percent said "somewhat likely."

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