PROGRESSIVE CORP/OH/ | 2013 | FY | 3

OTHER COMPREHENSIVE INCOME (LOSS)
The components of other comprehensive income (loss) for the years ended December 31, were as follows:
 
 
 
 
 
 
 
Components of Changes in
Accumulated Other
Comprehensive Income (after tax)
(millions)
Pretax total
accumulated
other
comprehensive
income

 
Total tax
(provision)
benefit

 
After tax total
accumulated
other
comprehensive
income

 
Total net
unrealized
gains (losses)
on securities

 
Net
unrealized
gains on
forecasted
transactions1,3

 
Foreign
currency
translation
adjustment

Balance at December 31, 2012
$
1,340.0

 
$
(469.0
)
 
$
871.0

 
$
862.7

 
$
6.1

 
$
2.2

Other comprehensive income (loss) before reclassifications:
 
 
 
 
 
 
 
 
 
 
 
Investment securities
368.2

 
(128.9
)
 
239.3

 
239.3

 
0

 
0

Net non-credit related OTTI losses, adjusted for valuation changes
.4

 
(.1
)
 
.3

 
.3

 
0

 
0

Forecasted transactions
0

 
0

 
0

 
0

 
0

 
0

Foreign currency translation adjustment
(2.5
)
 
.9

 
(1.6
)
 
0

 
0

 
(1.6
)
Total other comprehensive income (loss) before reclassifications
366.1

 
(128.1
)
 
238.0

 
239.6

 
0

 
(1.6
)
Less: Reclassification adjustment for amounts realized in net income by income statement line item:
 
 
 
 
 
 
 
 
 
 
 
Net impairment losses recognized in earnings
(5.7
)
 
2.0

 
(3.7
)
 
(3.7
)
 
0

 
0

Net realized gains (losses) on securities2
245.5

 
(86.0
)
 
159.5

 
159.0

 
.5

 
0

Interest expense3
2.2

 
(.7
)
 
1.5

 
0

 
1.5

 
0

Total reclassification adjustment for amounts realized in net income
242.0

 
(84.7
)
 
157.3

 
155.3

 
2.0

 
0

Total other comprehensive income (loss)
124.1

 
(43.4
)
 
80.7

 
84.3

 
(2.0
)
 
(1.6
)
Balance at December 31, 2013
$
1,464.1

 
$
(512.4
)
 
$
951.7

 
$
947.0

 
$
4.1

 
$
.6

 
 
 
 
 
 
 
 
Components of Changes in
Accumulated Other
Comprehensive Income (after tax)
(millions)
Pretax total
accumulated
other
comprehensive
income

 
Total tax
(provision)
benefit

 
After tax total
accumulated
other
comprehensive
income

 
Total net
unrealized
gains (losses)
on securities

 
Net
unrealized
gains on
forecasted
transactions1

 
Foreign
currency
translation
adjustment

Balance at December 31, 2011
$
1,065.4

 
$
(372.9
)
 
$
692.5

 
$
682.8

 
$
7.9

 
$
1.8

Other comprehensive income (loss) before reclassifications:
 
 
 
 
 
 
 
 
 
 
 
Investment securities
488.0

 
(170.8
)
 
317.2

 
317.2

 
0

 
0

Net non-credit related OTTI losses, adjusted for valuation changes
7.9

 
(2.8
)
 
5.1

 
5.1

 
0

 
0

Forecasted transactions
0

 
0

 
0

 
0

 
0

 
0

Foreign currency translation adjustment
.6

 
(.2
)
 
.4

 
0

 
0

 
.4

Total other comprehensive income (loss) before reclassifications
496.5

 
(173.8
)
 
322.7

 
322.3

 
0

 
.4

Less: Reclassification adjustment for amounts realized in net income by income statement line item:
 
 
 
 
 
 
 
 
 
 
 
Net impairment losses recognized in earnings
(.4
)
 
.1

 
(.3
)
 
(.3
)
 
0

 
0

Net realized gains (losses) on securities2
220.1

 
(77.0
)
 
143.1

 
142.7

 
.4

 
0

Interest expense
2.2

 
(.8
)
 
1.4

 
0

 
1.4

 
0

Total reclassification adjustment for amounts realized in net income
221.9

 
(77.7
)
 
144.2

 
142.4

 
1.8

 
0

Total other comprehensive income (loss)
274.6

 
(96.1
)
 
178.5

 
179.9

 
(1.8
)
 
.4

Balance at December 31, 2012
$
1,340.0

 
$
(469.0
)
 
$
871.0

 
$
862.7

 
$
6.1

 
$
2.2



 
 
 
 
 
 
 
 
Components of Changes in
Accumulated Other
Comprehensive Income (after tax)
(millions)
Pretax total
accumulated
other
comprehensive
income

 
Total tax
(provision)
benefit

 
After tax total
accumulated
other
comprehensive
income

 
Total net
unrealized
gains (losses)
on securities

 
Net
unrealized
gains on
forecasted
transactions1

 
Foreign
currency
translation
adjustment

Balance at December 31, 2010
$
1,205.6

 
$
(421.9
)
 
$
783.7

 
$
767.3

 
$
14.7

 
$
1.7

Other comprehensive income (loss) before reclassifications:
 
 
 
 
 
 
 
 
 
 
 
Investment securities
75.4

 
(26.4
)
 
49.0

 
49.0

 
0

 
0

Net non-credit related OTTI losses, adjusted for valuation changes
(5.5
)
 
1.9

 
(3.6
)
 
(3.6
)
 
0

 
0

Forecasted transactions
(5.1
)
 
1.8

 
(3.3
)
 
0

 
(3.3
)
 
0

Foreign currency translation adjustment
.2

 
(.1
)
 
.1

 
0

 
0

 
.1

Total other comprehensive income (loss) before reclassifications
65.0

 
(22.8
)
 
42.2

 
45.4

 
(3.3
)
 
.1

Less: Reclassification adjustment for amounts realized in net income by income statement line item:
 
 
 
 
 
 
 
 
 
 
 
Net impairment losses recognized in earnings
(.6
)
 
.2

 
(.4
)
 
(.4
)
 
0

 
0

Net realized gains (losses) on securities2
200.8

 
(70.3
)
 
130.5

 
130.3

 
.2

 
0

Interest expense
5.0

 
(1.7
)
 
3.3

 
0

 
3.3

 
0

Total reclassification adjustment for amounts realized in net income
205.2

 
(71.8
)
 
133.4

 
129.9

 
3.5

 
0

Total other comprehensive income (loss)
(140.2
)
 
49.0

 
(91.2
)
 
(84.5
)
 
(6.8
)
 
.1

Balance at December 31, 2011
$
1,065.4

 
$
(372.9
)
 
$
692.5

 
$
682.8

 
$
7.9

 
$
1.8


1 Entered into for the purpose of managing interest rate risk associated with our debt issuances.
2 During 2013, 2012, and 2011, we reclassified $0.8 million, $0.6 million, and $0.3 million, respectively, on a pretax basis, from accumulated other comprehensive income on the balance sheet to net realized gains on securities on the comprehensive income statement, reflecting the portion of the unrealized gain on forecasted transactions that was related to the portion of the 6.70% Debentures repurchased during the periods (see Note 4 – Debt for further discussion).
3 We expect to reclassify $2.1 million (pretax) into income during the next 12 months, related to net unrealized gains on forecasted transactions.

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