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Exhibit No. 10(A)

                           THE PROGRESSIVE CORPORATION
                              2005 GAINSHARING PLAN

1.    The Progressive Corporation and its subsidiaries (collectively
      "Progressive" or the "Company") have adopted The Progressive Corporation
      2005 Gainsharing Plan (the "Plan") as part of their overall compensation
      program. The Plan is performance-based and is administered under the
      direction of the Compensation Committee of the Board of Directors of The
      Progressive Corporation (the "Committee").

2.    Plan participants for each Plan year shall be selected by the Committee
      from those officers and regular employees of Progressive who are assigned
      primarily to the Core Business (as defined below), another operating
      business unit or a corporate support function. The gainsharing
      opportunity, if any, for those executive officers who participate in The
      Progressive Corporation 2004 Executive Bonus Plan ("Executive Plan") will
      be provided by and be a component of that plan, although participants in
      the Executive Plan may also participate in this Plan if and to the extent
      determined by the Committee. Plan years will coincide with Progressive's
      fiscal years.

3.    Annual Gainsharing Payments under the Plan will be determined by
      application of the following formula:

            Annual Gainsharing Payment = Paid Earnings x Target Percentage x
            Performance Factor

4.    Paid Earnings for any Plan year shall mean and include: (a) regular, used
      Earned Time Benefit, sick, holiday, funeral and overtime pay received by
      the participant during the Plan year for work or services performed during
      the Plan year as an officer or employee of Progressive, and (b)
      retroactive payments of any of the foregoing items relating to the same
      Plan year.

      For purposes of the Plan, Paid Earnings shall not include any short-term
      or long-term disability payments made to the participant, the earnings
      replacement component of any worker's compensation award, any lump sum
      merit award, payments from the merit cash pool or any other bonus or
      incentive compensation awards and unused Earned Time Benefit.

      Notwithstanding the foregoing, if the sum of the regular, used Earned Time
      Benefit, sick, holiday and funeral pay received by a participant for a
      Plan year exceeds his/her salary range maximum for the Plan year
      (determined on an individual pay period basis as of the end of the 24th
      pay period), then his/her Paid Earnings for that Plan year shall equal
      his/her salary range maximum, plus any of the following items received by
      such participant for that Plan year: (a) overtime pay, and (b) retroactive
      payments of regular,
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      used Earned Time Benefit, sick, holiday, overtime and funeral pay relating
      to that Plan year.

5.    Target Percentages vary by position. Target Percentages for Plan
      participants typically are as follows:

<TABLE>
<CAPTION>
                         POSITION                                  TARGET %
--------------------------------------------------------          ----------
<S>                                                               <C>
Senior Executives, Executive Level Managers and Business           60 - 135%
Leaders

Directors of Large Functional Areas                                   35-60%

Senior Managers                                                       20-35%

Middle Managers                                                       15-20%

Senior Professionals and Entry Level Managers                        9 - 15%

Administrative Support and Entry Level Professionals                  0 - 8%
</TABLE>

      Target Percentages will be established within the above ranges by, and may
      be changed with the approval of, the following officers of The Progressive
      Corporation (collectively, the "Designated Executives"): (a) the Chief
      Executive Officer, and (b) either the Chief Human Resource Officer or the
      Chief Financial Officer. Target Percentages also may be changed from year
      to year by the Designated Executives.

6.    The Performance Factor

      A.    General

            The Performance Factor shall consist of one or more Profitability
            and Growth Components, as described below ("Performance
            Components"). The Performance Components may be weighted to reflect
            the nature of the individual participant's assigned
            responsibilities. The weighting factors may differ among
            participants and will be determined, and may be changed from year to
            year, by or under the direction of the Committee.

      B.    Profitability and Growth Components

            The Profitability and Growth Components measure the overall
            operating performance of Progressive's Core Business (including the
            Agency Business

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            Segment, the Direct Business Segment and the Commercial Auto
            Business Segment, but excluding Midland Financial Group, Inc.), or a
            designated Business Segment, for the Plan year for which an Annual
            Gainsharing Payment is to be made. For purposes of computing a
            Performance Score for these Components, operating performance
            results are measured by one or more Performance Matrices, as
            established by or under the direction of the Committee for the Plan
            year, which assign a Performance Score to various combinations of
            profitability and growth outcomes. Except as provided below, under
            the Performance Matrices, profitability is measured by the GAAP
            Combined Ratio and growth is based on the year-to-year change in Net
            Earned Premiums.

            For 2005, and for each Plan year thereafter until otherwise
            determined by the Committee, separate Performance Scores will be
            determined, and separate Gainsharing Matrices will be used, for the
            Agency Business Segment, the Direct Business Segment and the
            Commercial Auto Business Segment. For purposes hereof, the Agency
            Business Segment includes Agency Auto (including Strategic Alliances
            Agency Auto) and Agency Special Lines. The Direct Business Segment
            includes Auto and Special Lines business produced by phone or over
            the Internet. For purposes of this Plan, the Midland Financial
            Group, Inc.'s results are excluded from the Agency, Direct and
            Commercial Auto Business Segments and, thus, from Core Business
            results. Net operating gains/losses from other Core products, if
            any, will be apportioned among the Agency, Direct and Commercial
            Auto Business Segments in accordance with the respective amount(s)
            of Net Earned Premiums generated by such products in each such
            Business Segment and the apportioned gains/losses will be included
            in the calculation of the Combined Ratio.

            The GAAP Combined Ratio will be separately determined for each of
            the Agency Business Segment, the Direct Business Segment and the
            Commercial Auto Business Segment. The GAAP Combined Ratio of each
            such Business Segment will then be matched with growth in Net Earned
            Premiums for such Business Segment using the applicable Gainsharing
            Matrix, to determine a Performance Score ("Standard Performance
            Computation").

            For 2005 and for each Plan year thereafter until otherwise
            determined by the Committee, a portion of the Annual Gainsharing
            Payment earned by members of the Direct Business Leadership Group
            (as defined below) will be determined by measuring operating results
            achieved by the Direct Business Segment in terms of certain modified
            profitability and growth criteria (as described below) and by
            comparing the results against pre-established targets that are set
            forth in a performance matrix approved by or under the direction of
            the Committee ("Modified Performance Computation"). The Modified
            Performance Computation will apply only to members of the Direct
            Business Leadership Group and only as and to the extent set forth
            below.

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            The Direct Business Leadership Group includes the Direct Business
            Leader, the IT Director for the Direct Business Segment and all
            other employees assigned primarily to the Direct Business Segment
            who are eligible to participate in the Company's equity incentive
            plans and have been designated by the Direct Business Leader.

            For purposes of the Modified Performance Computation:

            (i)   Profitability is measured by the variance between (i) the GAAP
                  Combined Ratio for premium earned during the Plan year with
                  respect to new Auto and Special Lines policies written by the
                  Direct Business Segment, and (ii) a target Combined Ratio,
                  which is adjusted quarterly to reflect the then current
                  pricing targets established and business mix (i.e., the
                  percentage of business earned in each business line and risk
                  tier). The Combined Ratio and pricing targets are subject to
                  approval by or under direction of the Committee.

            (ii)  Growth is measured by the year-to-year change in Lifetime
                  Earned Premium (as defined below) for business written by the
                  Direct business Segment. Lifetime Earned Premium is the amount
                  of earned premium that the Company is projected to generate
                  over time with respect to new policies written by the Direct
                  Business Segment during a given Plan Year (including any
                  subsequent renewals thereof), which is determined by a
                  formula, as approved by or under the direction of the
                  Committee, that utilizes a combination of historical
                  experience data and statistical analysis.

      C.    Component Weighting

            For most participants, the Performance Factor will be determined
            solely by the performance results for the Core Business, consisting
            of the Agency, Direct and Commercial Auto Business Segments. The
            Performance Score for each such Business Segment will be separately
            determined, as described above, by application of the Standard
            Performance Computation and the appropriate Gainsharing Matrix. The
            resulting Performance Scores for each of the Agency, Direct and
            Commercial Auto Business Segments will then be multiplied by a
            weighting factor (based on the percentage of Net Earned Premiums
            generated by each such Business Segment during the Plan year), the
            weighted Performance Scores will be combined and the sum of the
            weighted Performance Scores will be the Performance Score for the
            Core Business.

            As noted above, for most participants, the Performance Factor will
            be the Performance Score for the Core Business. For certain
            employees designated by or under the direction of the Committee,
            however, the Performance Factor will be based on the Performance
            Scores for both the Core Business, as a whole, and their assigned
            Business Segment. Generally, for these employees,

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            the Performance Factor will be based 50% on the Core Business
            Performance Score and 50% on their assigned Business Segment's
            Performance Score.

            With respect to each of the IT Business Leaders selected by the
            Designated Executives, the Performance Factor will be based on both
            the Core Business Performance Score and the Business Segment
            Performance Score of his or her assigned Business Segment, in such
            ratio or otherwise weighted as shall be determined by or under the
            direction of the Committee.

            Except as otherwise determined by the Committee, for members of the
            Direct Business Leadership Group, the Performance Factor will be
            based 50% on the Core Business Performance Score, 25% on the Direct
            Business Performance Score (Standard Performance Computation) and
            25% on the Direct Business Performance Score (Modified Performance
            Computation).

            The Performance Score for each Performance Component will be
            multiplied by the assigned weighting factor to produce a Weighted
            Performance Score. The sum of the Weighted Performance Scores equals
            the Performance Factor. The final Performance Factor can vary from 0
            to 2.0, based on actual performance versus the pre-established
            objectives. The Performance Factor cannot exceed 2.0, regardless of
            results.

7.    Subject to Paragraph 9 below, no later than December 31 of each Plan year,
      each participant will receive an initial payment in respect of his or her
      Annual Gainsharing Payment for that Plan year equal to 75% of an amount
      calculated on the basis of Paid Earnings for the first 24 pay periods of
      the Plan year, estimated earnings for the remainder of the Plan year,
      performance data through the first 11 months of the Plan year (estimated,
      if necessary) and forecasted operating results for the remainder of the
      Plan year. No later than February 15 of the following year, each
      participant will receive the balance of his or her Annual Gainsharing
      Payment, if any, for such Plan year, based on his or her Paid Earnings and
      performance data for the entire Plan year.

      Any Plan participant who is then eligible to participate in The
      Progressive Corporation Executive Deferred Compensation Plan ("Deferral
      Plan") may elect to defer all or a portion of the Annual Gainsharing
      Payment otherwise payable to him/her under this Plan, subject to and in
      accordance with the terms of the Deferral Plan.

8.    If, for any Plan year, an employee has been selected to participate in
      both the Plan and another incentive plan offered by the Company, then with
      respect to such employee, the Gainsharing formula set forth in Paragraph 3
      hereof shall be appropriately adjusted by applying a weighting factor to
      reflect the proportion of the employee's total annual incentive
      opportunity that is being provided by the Plan. The Committee shall have
      full authority to determine the incentive plan or plans in which any
      employee shall participate during any plan year and, if an employee is
      selected to participate in more than one plan, the weighting factor that
      will apply to each such plan.

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9.    Unless otherwise determined by the Committee, and except as expressly
      provided herein, in order to be entitled to receive an Annual Gainsharing
      Payment for any Plan year, the participant must be assigned to the Core
      Business or a participating business unit or support function, and be an
      active employee of the Company, on November 30 of the Plan year
      ("Qualification Date"). Individuals who are hired on or after December 1
      of any Plan year are not entitled to an Annual Gainsharing Payment for
      that Plan year.

      Any participant who is on a leave of absence covered by the Family and
      Medical Leave Act of 1993, personal leave of absence with the approval of
      the Company, military leave or short or long-term disability on the
      Qualification Date with respect to any Plan year will be entitled to
      receive an Annual Gainsharing Payment for such Plan year, calculated as
      provided in Paragraphs 3 through 6 above and based on the amount of Paid
      Earnings received by such participant during the Plan year.

      Annual Gainsharing will be net of any legally required deductions for
      federal, state and local taxes and other items.

10.   The right to any Annual Gainsharing Payment hereunder may not be sold,
      transferred, assigned or encumbered by any participant. Nothing herein
      shall prevent any participant's interest hereunder from being subject to
      involuntary attachment, levy or other legal process.

11.   The Plan shall be administered by or under the direction of the Committee.
      The Committee shall have the authority to adopt, amend, revise and repeal
      such rules, guidelines, procedures and practices governing the Plan as it
      shall, from time to time, in its sole discretion, deem advisable.

      The Committee shall have full authority to determine the manner in which
      the Plan will operate, to interpret the provisions of the Plan and to make
      all determinations hereunder. All such interpretations and determinations
      shall be final and binding on Progressive, all Plan participants and all
      other parties. No such interpretation or determination shall be relied on
      as a precedent for any similar action or decision.

      Unless otherwise determined by the Committee, all of the authority of the
      Committee hereunder (including, without limitation, the authority to
      administer the Plan, select the persons entitled to participate herein,
      interpret the provisions thereof, waive any of the requirements specified
      herein and make determinations hereunder and to select, approve,
      establish, change or modify Performance Components and their respective
      formulae, weighting factors, performance targets and Target Percentages)
      may be exercised by the Designated Executives. In the event of a dispute
      or conflict, the determination of the Committee will govern.

12.   The Plan may be terminated, amended or revised, in whole or in part, at
      any time and from time to time by the Committee, in its sole discretion.

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13.   The Plan will be unfunded and all payments due under the Plan shall be
      made from Progressive's general assets.

14.   Nothing in the Plan shall be construed as conferring upon any person the
      right to remain a participant in the Plan or to remain employed by
      Progressive, nor shall the Plan limit Progressive's right to discipline or
      discharge any of its officers or employees or change any of their job
      titles, duties or compensation.

15.   Progressive shall have the unrestricted right to set off against or
      recover out of any Annual Gainsharing Payment or other sums owed to any
      participant under the Plan any amounts owed by such participant to
      Progressive.

16.   This Plan supersedes all prior plans, agreements, understandings and
      arrangements regarding bonuses or other cash incentive compensation
      payable to participants by or due from Progressive. Without limiting the
      generality of the foregoing, this Plan supersedes and replaces The
      Progressive Corporation 2004 Gainsharing Plan (the "Prior Plan"), which is
      and shall be deemed to be terminated as of January 1, 2005 (the
      "Termination Date"); provided, that any bonuses or other sums earned and
      payable under the Prior Plan with respect to any Plan year ended on or
      prior to the Termination Date shall be unaffected by such termination and
      shall be paid to the appropriate participants when and as provided
      thereunder.

17.   This Plan is adopted, and is to be effective, as of January 2, 2005, which
      is the commencement of Progressive's 2005 fiscal year. This Plan shall be
      effective for the 2005 Plan year (which coincides with Progressive's 2005
      fiscal year) and for each Plan year thereafter unless and until terminated
      by the Committee.

18.   This Plan shall be interpreted and construed in accordance with the laws
      of the State of Ohio.

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