They don't. I heard this directly from Progressive themselves. Progressive also uses other underwriters for home owner's insurance and don't directly underwrite themselves. None of this is a secret, it's all out in the open for everybody to know.
If one actually wants to know it is quite easy to look up the answers in public disclosures. FWIW, customer service representatives rarely know much about their own company actual underwriting process.
All insurance companies use reinsurance to manage their direct exposures on some or even all of their risk categories. Progressive, however is one of the largest underwriters of vehicle insurance and do not use any other company in their vehicle underwriting process. In fact Progressive has what many consider to be the most comprehensive database on vehicle risk categories.
Because of that they frequently provide the lowest prices in categories otherwise up charged by other companies. That specifically applies to Tesla, where their expertise extends to advantages in claims processing due to direct Contacts with most Tesla-authorized body shops in the US. Further that advantage can be seen in both Comprehensive and Collision pricing.
Progressive also lowers rates with claims free persistency and for multiple policies. They do tend to be exceedingly adept with treaty management (as applies to accidents in much of Canada for US policyholders, which are paid by Progressive even when fault of accident is another party. Geico has some similar advantages, but less comprehensively than does Progressive. State Farm, popular among many of us, does not have a stellar capacity for unusual risks.
Context: I do not claim to be an expert on vehicle insurance. I have consulted with several insurance companies including some based in the Midwest US regarding modeling of consumer risk management issues. In that process I have examined public documents for every company mentioned in this thread and others.
In my personal auto and homeowners policies I choose first for underwriting policies, next for claims management, third for price. I do not consult any consumer survey data. In the US, I currently use Progressive and have done since I bought my first Tesla.
FWIW, my Model P3D+ was severely damaged in an accident in New Brunswick five days after I bought it. It was being driven by a driver from Australia and the responsible driver for the accident was Quebec-licensed and had ‘inappropriate’ documentation for both the truck and trailer he was operating. Progressive covered 100% of the damage including diminished value (explicitly excluded from my Florida cover) because they, not I, told me about their treaty conditions. A couple of months after that expensive accident my insurance was renewed including a rate reduction, repeat; rate reduction due to my claim free record.
The foregoing is 100% true and also a rare situation. Progressive could have neglected to follow the Canadian/US treaty terms if they had wished to, but they instead treated this exactly as kindly as possible including charging the accident to a category that did not affect my record.
When choosing an insurance carrier it is important to do homework in advance to ensure that if presented with an unusual claim or an ordinary one you can rely on the integrity of the company. Eventually you’ll benefit by having done that research.
FWIW part 2: I do the same thing with my covers in other countries (at the moment I have two others). Luckily I have had few claims in my life, but I have never regretted spending extra time to be prepared since, after all, that is what insurance is for.
Lastly, when insuring a Tesla it is important to know that your chosen company is very familiar with their risks, especially since Tesla loss frequency is much lower than average, human being loss severity is vastly lower than average, but collision repair is more costly than average. Combining these actuarial categories can result in widely varied quotations for identical risk. Hint: companies that specialize in mass market risk are rarely wise choices for an unusual vehicle.