The Hartford Announces Excellent Third Quarter 2024 Financial Performance
The Hartford (HIG) reported strong Q3 2024 financial results with net income of $761 million ($2.56 per share), up 18% from Q3 2023. Core earnings reached $752 million ($2.53 per share), a 6% increase. The company demonstrated solid growth with P&C written premiums up 10%, driven by Commercial Lines (+9%) and Personal Lines (+12%). Notable achievements include a Commercial Lines combined ratio of 92.2, Group Benefits net income margin of 8.8%, and a trailing 12-month net income ROE of 20.0%. The company increased its quarterly dividend by 11% to $0.52 per share and returned $538 million to stockholders through share repurchases and dividends.
The Hartford (HIG) ha riportato solidi risultati finanziari per il terzo trimestre del 2024, con un utile netto di 761 milioni di dollari (2,56 dollari per azione), in aumento del 18% rispetto al terzo trimestre del 2023. Gli utili core hanno raggiunto 752 milioni di dollari (2,53 dollari per azione), mostrando un incremento del 6%. L'azienda ha dimostrato una crescita robusta con un aumento del 10% nei premi scritti P&C, spinta dalle linee commerciali (+9%) e dalle linee personali (+12%). Tra i risultati notevoli, si segnala un rapporto combinato delle linee commerciali del 92,2, un margine di utile netto del 8,8% per i benefici di gruppo e un ritorno sul capitale netto (ROE) negli ultimi 12 mesi del 20,0%. L'azienda ha aumentato il dividendo trimestrale dell'11% a 0,52 dollari per azione e ha restituito 538 milioni di dollari agli azionisti attraverso riacquisti di azioni e dividendi.
The Hartford (HIG) reportó resultados financieros sólidos para el tercer trimestre de 2024, con un ingreso neto de 761 millones de dólares (2,56 dólares por acción), un aumento del 18% en comparación con el tercer trimestre de 2023. Las ganancias principales alcanzaron los 752 millones de dólares (2,53 dólares por acción), lo que representa un incremento del 6%. La compañía demostró un crecimiento sólido con un aumento del 10% en las primas escritas de P&C, impulsado por las líneas comerciales (+9%) y las líneas personales (+12%). Los logros notables incluyen un índice combinado de líneas comerciales del 92,2, un margen de ingreso neto de beneficios grupales del 8,8% y un ROE de ingresos netos de 20,0% en los últimos 12 meses. La compañía aumentó su dividendo trimestral en un 11% a 0,52 dólares por acción y devolvió 538 millones de dólares a los accionistas a través de recompras de acciones y dividendos.
하르트포드 (HIG)는 2024년 3분기에 7억 6100만 달러(주당 2.56달러)의 순이익을 기록하며 강력한 재무 실적을 보고했으며, 이는 2023년 3분기 대비 18% 증가한 수치입니다. 핵심 수익은 7억 5200만 달러(주당 2.53달러)에 달하며, 6% 증가했습니다. 회사는 상업 라인(+9%)과 개인 라인(+12%)에 의해 추진된 P&C 발행 보험료가 10% 증가하여 견고한 성과를 보여주었습니다. 주요 성과로는 상업 라인의 결합 비율 92.2, 그룹 혜택 순이익 마진 8.8%, 지난 12개월 순이익 자기자본이익률(ROE) 20.0%가 있습니다. 회사는 분기 배당금을 11% 증가시켜 주당 0.52달러로 조정했으며, 주식 매입 및 배당금을 통해 주주에게 5억 3800만 달러를 반환했습니다.
The Hartford (HIG) a annoncé des résultats financiers solides pour le troisième trimestre 2024, avec un bénéfice net de 761 millions de dollars (2,56 dollars par action), en hausse de 18 % par rapport au troisième trimestre 2023. Les bénéfices fondamentaux ont atteint 752 millions de dollars (2,53 dollars par action), soit une augmentation de 6 %. L'entreprise a démontré une forte croissance avec des primes P&C écrites en augmentation de 10 %, soutenue par les lignes commerciales (+9 %) et les lignes personnelles (+12 %). Parmi les réalisations notables, on trouve un ratio combiné des lignes commerciales de 92,2, une marge bénéficiaire nette des prestations de groupe de 8,8 % et un retour sur capitaux propres (ROE) net sur 12 mois de 20,0 %. L'entreprise a augmenté son dividende trimestriel de 11 % à 0,52 dollar par action et a restitué 538 millions de dollars aux actionnaires par le biais de rachats d'actions et de dividendes.
The Hartford (HIG) hat im dritten Quartal 2024 starke finanzielle Ergebnisse mit einem Nettogewinn von 761 Millionen Dollar (2,56 Dollar pro Aktie) gemeldet, was einem Anstieg von 18% im Vergleich zum dritten Quartal 2023 entspricht. Die Kerngewinne erreichten 752 Millionen Dollar (2,53 Dollar pro Aktie) und stiegen um 6%. Das Unternehmen zeigte solides Wachstum mit einer Erhöhung der P&C-Prämien um 10%, angetrieben durch gewerbliche Linien (+9%) und persönliche Linien (+12%). Zu den bemerkenswerten Ergebnissen gehören ein kombinierter Satz gewerblicher Linien von 92,2, eine Nettogewinnmarge von 8,8% im Gruppenversicherungsbereich sowie eine Eigenkapitalrendite (ROE) von 20,0% über die letzten 12 Monate. Das Unternehmen erhöhte seine vierteljährliche Dividende um 11% auf 0,52 Dollar pro Aktie und gab 538 Millionen Dollar an die Aktionäre zurück, durch Aktienrückkäufe und Dividenden.
- Net income increased 18% YoY to $761 million
- P&C written premiums grew 10%
- 20.0% trailing 12-month ROE
- 11% dividend increase to $0.52 per share
- Commercial Lines achieved 88.6 underlying combined ratio
- Returned $538 million to stockholders in Q3
- CAY catastrophe losses increased to $247 million, including $104 million from Hurricane Helene
- Higher expense ratios across P&C and Group Benefits segments
- Group Benefits core earnings declined 9% YoY
Insights
The Hartford delivered an outstanding Q3 2024 with significant financial improvements across key metrics. Net income of
Commercial Lines showed robust growth with written premiums up
Despite
The Hartford's results demonstrate superior underwriting discipline and pricing power. The Commercial Lines' underlying combined ratio of
Personal Lines' turnaround is gaining momentum with substantial rate increases (
The company's ability to achieve these results while returning
Increased quarterly common dividend per share by
-
Third quarter 2024 net income available to common stockholders of
$761 million $2.56 18% from$645 million $2.09 $752 million $2.53 6% from$708 million $2.29 -
Net income ROE for the trailing 12 months of
20.0% and core earnings ROE* of17.4% . -
Property & Casualty (P&C) written premiums rose
10% in third quarter 2024, driven by Commercial Lines and Personal Lines premium growth of9% and12% , respectively. - Commercial Lines third quarter combined ratio of 92.2 and underlying combined ratio* of 88.6.
-
P&C current accident year (CAY) catastrophe (CAT) losses in third quarter 2024 of
$247 million $104 million -
Group Benefits third quarter net income margin of
8.8% and core earnings margin* of8.7% . -
Returned
$538 million $400 million $138 million 11% , to$0.52
* Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures.
** All amounts and percentages set forth in this news release are approximate unless otherwise noted.
"The
The
Swift continued, “The Hartford’s performance through the first nine months of 2024 is a powerful example of sustained financial excellence even in the face of industry-wide elevated catastrophe losses. With strong capital generation, we are pleased to announce an 11 percent increase in our quarterly common dividend. Our franchise has never been better positioned to sustain industry-leading financial performance and create value for all our stakeholders.”
CONSOLIDATED RESULTS:
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Three Months Ended |
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($ in millions except per share data) |
Sep 30
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Sep 30
|
Change |
Net income available to common stockholders |
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Net income available to common stockholders per diluted share1 |
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|
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|
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Core earnings |
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Core earnings per diluted share |
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Book value per diluted share |
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Book value per diluted share (ex. accumulated other comprehensive income (AOCI))2 |
|
|
|
|
|
|
|
Net income available to common stockholders' return on equity (ROE)3, last 12-months |
|
|
2.3 |
Core earnings ROE3, last 12-months |
|
|
2.5 |
[1] Includes dilutive potential common shares; for net income available to common stockholders per diluted share, the numerator is net income less preferred dividends
|
|||
Third quarter 2024 net income available to common stockholders of
Third quarter 2024 core earnings of
-
An increase in earnings generated by
11% growth in P&C earned premium. -
Net investment income of
$659 million $597 million - Personal Lines loss and loss adjustment expense ratio of 76.8 improved 6.9 points compared with 83.7 in third quarter 2023, including a change from unfavorable PYD of 0.1 points in 2023 to favorable PYD of 1.6 points in 2024 and 1.6 points of higher CATs. Underlying loss and loss adjustment expense ratio* of 68.0 improved 6.7 points from third quarter 2023, largely due to the impact of earned pricing increases, lower frequency in auto physical damage and lower frequency in homeowners.
- Group Benefits loss ratio of 70.2 was flat with third quarter 2023, primarily driven by a lower group life loss ratio offset by a higher disability loss ratio, as well as a higher loss ratio on supplemental health products.
-
P&C CAY CAT losses of
$247 million $104 million $184 million - Commercial Lines loss and loss adjustment expense ratio of 61.0 compared with 58.9 in third quarter 2023, including 0.5 points of less favorable PYD and 0.9 points of higher CATs. Underlying loss and loss adjustment expense ratio of 57.3 compared with 56.6 in third quarter 2023, with the increase largely due a higher general liability loss ratio, partially offset by lower non-CAT property losses.
-
Net favorable prior accident year development (PYD) in core earnings of
$24 million $43 million - The expense ratios increased across P&C and Group Benefits from third quarter 2023, primarily driven by higher incentive compensation and benefits costs, and higher marketing spend in Personal Lines.
Sept. 30, 2024, book value per diluted share of
Book value per diluted share (excluding AOCI) of
Net income available to common stockholders' ROE (net income ROE) for the 12-month period ending Sept. 30, 2024, was
Core earnings ROE for the 12-month period ending Sept. 30, 2024, was
BUSINESS RESULTS:
Commercial Lines
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Sep 30
|
Sep 30
|
Change |
Net income |
|
|
|
Core earnings |
|
|
( |
Written premiums |
|
|
|
Underwriting gain1 |
|
|
( |
Underlying underwriting gain1 |
|
|
|
Losses and loss adjustment expense ratio |
|
|
|
Current accident year before catastrophes |
57.3 |
56.6 |
0.7 |
Current accident year catastrophes |
4.8 |
3.9 |
0.9 |
Favorable prior accident year development |
(1.1) |
(1.6) |
0.5 |
Expenses |
30.9 |
30.7 |
0.2 |
Policyholder dividends |
0.3 |
0.5 |
(0.2) |
Combined ratio |
92.2 |
90.2 |
2.0 |
Impact of catastrophes and PYD on combined ratio |
(3.7) |
(2.3) |
(1.4) |
Underlying combined ratio |
88.6 |
87.8 |
0.8 |
[1] Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures |
|||
Third quarter 2024 net income of
Commercial Lines core earnings of
-
10% growth in earned premium. -
Net investment income of
$442 million $395 million -
CAY CAT losses of
$155 million $55 million the United States , up from CAY CAT losses of$115 million - An underlying loss and loss adjustment expense ratio of 57.3, in third quarter 2024 compared with 56.6 in third quarter 2023, with the increase primarily driven by a higher general liability loss ratio, partially offset by lower non-CAT property losses.
-
Net favorable PYD within core earnings of
$10 million $46 million
Combined ratio of 92.2 compared with 90.2 in third quarter 2023, primarily due to a 2.1 point increase in the loss and loss adjustment expense ratio, including 0.5 points of less favorable PYD (including 0.8 points of favorable development related to the amortization of the deferred gain) and 0.9 points of higher CAY CAT losses. Underlying combined ratio of 88.6 compared with 87.8 in third quarter 2023 primarily due to a 0.7 point increase in the underlying loss and loss adjustment expense ratio.
- Small Commercial combined ratio of 91.6 compared with 87.7 in third quarter 2023, including 3.2 points of higher CAY CATs and 1.1 points of less favorable PYD. Underlying combined ratio of 89.3 improved 0.4 points compared with 89.7 in third quarter 2023, primarily due to lower non-CAT property losses, partially offset by a higher loss ratio in general liability.
- Middle & Large Commercial combined ratio of 97.0 compared with 94.5 in third quarter 2023, driven by 1.5 points of more unfavorable PYD, partially offset by 1.0 points of lower CAY CATs. Underlying combined ratio of 90.2 compared with 88.1 in third quarter 2023, primarily due to higher non-CAT property losses and a higher loss ratio in general liability and auto, partially offset by a lower expense ratio and the benefit of a shift in premium mix toward property lines.
- Global Specialty combined ratio of 87.4 improved 1.5 points compared with 88.9 in third quarter 2023, driven by a change from unfavorable PYD of 0.3 in 2023 to favorable PYD of 1.7 points in 2024 and 0.5 points of lower CAY CATs. The combined ratio included 2.9 points of favorable development due to the amortization of the deferred gain related to the Navigators ADC. Underlying combined ratio of 85.3 compared with 84.3 in third quarter 2023, primarily due to a higher loss ratio in global reinsurance and a higher expense ratio.
Third quarter 2024 written premiums of
Personal Lines
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Sep 30
|
Sep 30
|
Change |
Net income (loss) |
|
|
NM |
Core earnings (loss) |
|
|
NM |
Written premiums |
|
|
|
Underwriting loss |
|
|
|
Underlying underwriting gain |
|
|
NM |
Losses and loss adjustment expense ratio |
|
|
|
Current accident year before catastrophes |
68.0 |
74.7 |
(6.7) |
Current accident year catastrophes |
10.4 |
8.8 |
1.6 |
Favorable prior accident year development |
(1.6) |
0.1 |
(1.7) |
Expenses |
25.6 |
24.2 |
1.4 |
Combined ratio |
102.5 |
107.9 |
(5.4) |
Impact of catastrophes and PYD on combined ratio |
(8.8) |
(8.9) |
0.1 |
Underlying combined ratio |
93.7 |
99.0 |
(5.3) |
Net income of
Personal Lines core earnings of
- An underlying loss and loss adjustment expense ratio of 68.0 in third quarter 2024, which improved 6.7 points from 74.7 in third quarter 2023, primarily driven by the impact of earned pricing increases and improvement in auto physical damage frequency and homeowners frequency.
-
13% growth in earned premium. -
$14 million $1 million -
Net investment income of
$58 million $47 million -
CAY CAT losses of
$92 million $49 million the United States , up from$69 million
Combined ratio of 102.5 in third quarter 2024, improved from 107.9 in third quarter 2023, primarily due to a 6.9 point improvement in the loss and loss adjustment expense ratio, including a 6.7 point improvement in the underlying loss and loss adjustment expense ratio and a change from unfavorable PYD of 0.1 points in 2023 to favorable PYD of 1.6 points in 2024, partially offset by 1.6 points of higher CAY CAT losses. Underlying combined ratio of 93.7 improved 5.3 points from 99.0 in third quarter 2023, primarily due to improvement in the underlying loss and loss adjustment expense ratio in auto and homeowners, partially offset by a 1.4 point increase in the expense ratio, largely driven by higher commissions and marketing expenses.
- Auto combined ratio of 105.7 improved from 110.8 in third quarter 2023. The underlying combined ratio of 101.5 improved 7.0 points from 108.5 in third quarter 2023, primarily due to improvement in underlying loss and loss adjustment expense ratio driven by the impact of double-digit earned pricing increases as well as lower physical damage claim frequency, partially offset by higher auto claim severities. The auto physical damage claim severity trend has moderated from the prior year. The auto liability severity increases continue to recognize the inflationary effects and higher attorney representation rates on bodily injury claims.
- Homeowners combined ratio of 94.7 improved from 101.4 in third quarter 2023. The underlying combined ratio of 75.4 improved 2.7 points from 78.1 in third quarter 2023, primarily due to improvement in underlying loss and loss adjustment expense ratio driven by the impact of double-digit earned pricing and lower claim frequency, partially offset by higher claim severities. Contributing to the higher homeowners severity was the effect of higher rebuilding costs.
- The expense ratio of 25.6 increased 1.4 points from third quarter 2023, primarily driven by higher direct marketing costs, higher commissions, and higher incentive compensation, partially offset by the impact of higher earned premium.
Written premiums in third quarter 2024 were
-
Renewal written price increases in auto and homeowners of
20.8% and15.2% , respectively, in response to elevated loss cost trends. -
An increase in new business in both homeowners and auto from third quarter 2023 of
$35 million 140% , and$22 million 36% , respectively. - Lower effective policy count retention in auto due to renewal written price increases.
Group Benefits
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Sep 30
|
Sep 30
|
Change |
Net income |
|
|
|
Core earnings |
|
|
( |
Fully insured ongoing premiums |
|
|
|
Loss ratio |
|
|
0.0 |
Expense ratio |
|
|
1.3 |
Net income margin |
|
|
0.3 |
Core earnings margin |
|
|
(1.1) |
Net income of
Fully insured ongoing premiums were up
Loss ratio of 70.2 was flat with third quarter 2023.
- Group life loss ratio of 77.5 improved 2.7 points largely driven by lower mortality.
- Group disability loss ratio of 67.9 compared with 67.3 in third quarter 2023, driven by a higher loss ratio in paid family and medical leave products, partially offset by a favorable change in the long-term disability recovery rate assumption of 2.2 points.
Expense ratio of 25.3 compared with 24.0 in third quarter 2023, primarily due to higher staffing costs, including higher incentive compensation and benefits costs, and increased investments in technology.
Net investment income of
Hartford Funds
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Sep 30
|
Sep 30
|
Change |
Net income |
|
|
|
Core earnings |
|
|
|
Daily average Hartford Funds AUM |
|
|
|
Mutual Funds and exchange-traded funds (ETF) net flows |
|
|
|
Total Hartford Funds AUM |
|
|
|
Third quarter 2024 net income of
Core earnings of
Daily average AUM of
Mutual fund and ETF net outflows totaled
Corporate
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Sep 30
|
Sep 30
|
Change |
Net loss |
|
|
|
Net loss available to common stockholders |
|
|
|
Core loss |
|
|
|
Net investment income, before tax |
|
|
|
Interest expense and preferred dividends, before tax |
|
|
(2)% |
Net loss available to common stockholders of
Third quarter 2024 core loss of
INVESTMENT INCOME AND PORTFOLIO DATA:
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Sep 30
|
Sep 30
|
Change |
Net investment income, before tax |
|
|
|
Annualized investment yield, before tax |
|
|
0.2 |
Annualized investment yield, before tax, excluding LPs1 |
|
|
0.4 |
Annualized LP yield, before tax |
|
|
(3.3) |
Annualized investment yield, after tax |
|
|
0.1 |
[1] Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures |
|||
Third quarter 2024 consolidated net investment income of
Third quarter 2024 net investment income, excluding LPs*, of
Third quarter 2024 included
Net realized losses of
Total invested assets of
CONFERENCE CALL
The
More detailed financial information can be found in The
About The
The
The Hartford Financial Services Group, Inc., (NYSE: HIG) operates through its subsidiaries under the brand name, The
HIG-F
From time to time, The
THE HARTFORD FINANCIAL SERVICES GROUP, INC. |
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CONSOLIDATING INCOME STATEMENTS |
||||||||||||||||||||||
Three Months Ended September 30, 2024 |
||||||||||||||||||||||
($ in millions) |
||||||||||||||||||||||
|
Commercial Lines |
Personal Lines |
P&C Other Ops |
Group Benefits |
Hartford Funds |
Corporate |
|
Consolidated |
||||||||||||||
Earned premiums |
$ |
3,249 |
|
$ |
885 |
|
$ |
— |
|
$ |
1,600 |
|
$ |
— |
|
$ |
— |
|
|
$ |
5,734 |
|
Fee income |
|
11 |
|
|
8 |
|
|
— |
|
|
55 |
|
|
263 |
|
|
10 |
|
|
|
347 |
|
Net investment income |
|
442 |
|
|
58 |
|
|
18 |
|
119 |
|
|
5 |
|
|
17 |
|
|
|
659 |
|
|
Net realized gains (losses) |
|
(32 |
) |
|
(2 |
) |
|
— |
|
|
— |
|
|
7 |
|
|
14 |
|
|
|
(13 |
) |
Other revenue |
|
1 |
|
|
22 |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
24 |
|
Total revenues |
|
3,671 |
|
|
971 |
|
|
18 |
|
|
1,774 |
|
|
275 |
|
|
42 |
|
|
|
6,751 |
|
Benefits, losses, and loss adjustment expenses |
|
1,981 |
|
|
680 |
|
|
— |
|
|
1,161 |
|
|
— |
|
|
1 |
|
|
|
3,823 |
|
Amortization of DAC |
|
512 |
|
|
65 |
|
|
— |
|
|
8 |
|
|
— |
|
|
— |
|
|
|
585 |
|
Insurance operating costs and other expenses |
|
509 |
|
|
186 |
|
|
7 |
|
|
401 |
|
|
208 |
|
|
12 |
|
|
|
1,323 |
|
Restructuring and other costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
1 |
|
Interest expense |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
49 |
|
|
|
49 |
|
Amortization of other intangible assets |
|
7 |
|
|
1 |
|
|
— |
|
|
10 |
|
|
— |
|
|
— |
|
|
|
18 |
|
Total benefits, losses and expenses |
|
3,009 |
|
|
932 |
|
|
7 |
|
|
1,580 |
|
|
208 |
|
|
63 |
|
|
|
5,799 |
|
Income (loss) before income taxes |
|
662 |
|
|
39 |
|
|
11 |
|
|
194 |
|
|
67 |
|
|
(21 |
) |
|
|
952 |
|
Income tax expense (benefit) |
|
134 |
|
|
8 |
|
|
1 |
|
|
38 |
|
|
13 |
|
|
(9 |
) |
|
|
185 |
|
Net income (loss) |
|
528 |
|
|
31 |
|
|
10 |
|
|
156 |
|
|
54 |
|
|
(12 |
) |
|
|
767 |
|
Preferred stock dividends |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6 |
|
|
|
6 |
|
Net income (loss) available to common stockholders |
|
528 |
|
|
31 |
|
|
10 |
|
|
156 |
|
|
54 |
|
|
(18 |
) |
|
|
761 |
|
Adjustments to reconcile net income (loss) available to common stockholders to core earnings (loss) |
|
|
|
|
|
|
|
|
||||||||||||||
Net realized losses (gains), excluded from core earnings, before tax |
|
31 |
|
|
2 |
|
|
— |
|
|
(1 |
) |
|
(7 |
) |
|
(13 |
) |
|
|
12 |
|
Restructuring and other costs, before tax |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
1 |
|
Integration and other non-recurring M&A costs, before tax |
|
2 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
2 |
|
Change in deferred gain on retroactive reinsurance, before tax |
|
(26 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
(26 |
) |
Income tax expense (benefit) |
|
(1 |
) |
|
— |
|
|
— |
|
|
(1 |
) |
|
— |
|
|
4 |
|
|
|
2 |
|
Core earnings (loss) |
$ |
534 |
|
$ |
33 |
|
$ |
10 |
|
$ |
154 |
|
$ |
47 |
|
$ |
(26 |
) |
|
$ |
752 |
|
THE HARTFORD FINANCIAL SERVICES GROUP, INC. |
||||||||||||||||||||||
CONSOLIDATING INCOME STATEMENTS |
||||||||||||||||||||||
Three Months Ended September 30, 2023 |
||||||||||||||||||||||
($ in millions) |
||||||||||||||||||||||
|
Commercial Lines |
Personal Lines |
P&C Other Ops |
Group Benefits |
Hartford Funds |
Corporate |
|
Consolidated |
||||||||||||||
Earned premiums |
$ |
2,951 |
|
$ |
784 |
|
$ |
— |
|
$ |
1,575 |
|
$ |
— |
|
$ |
— |
|
|
$ |
5,310 |
|
Fee income |
|
11 |
|
|
7 |
|
|
— |
|
|
54 |
|
|
248 |
|
|
10 |
|
|
|
330 |
|
Net investment income |
|
395 |
|
|
47 |
|
|
18 |
|
|
121 |
|
|
4 |
|
|
12 |
|
|
|
597 |
|
Net realized losses |
|
(38 |
) |
|
(5 |
) |
|
(2 |
) |
|
(31 |
) |
|
(4 |
) |
|
(10 |
) |
|
|
(90 |
) |
Other revenue (loss) |
|
(1 |
) |
|
21 |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
21 |
|
Total revenues |
|
3,318 |
|
|
854 |
|
|
16 |
|
|
1,719 |
|
|
248 |
|
|
13 |
|
|
|
6,168 |
|
Benefits, losses, and loss adjustment expenses |
|
1,738 |
|
|
656 |
|
|
2 |
|
|
1,146 |
|
|
— |
|
|
1 |
|
|
|
3,543 |
|
Amortization of DAC |
|
451 |
|
|
58 |
|
|
— |
|
|
8 |
|
|
— |
|
|
— |
|
|
|
517 |
|
Insurance operating costs and other expenses |
|
473 |
|
|
156 |
|
|
3 |
|
|
372 |
|
|
195 |
|
|
27 |
|
|
|
1,226 |
|
Restructuring and other costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
1 |
|
Interest expense |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
50 |
|
|
|
50 |
|
Amortization of other intangible assets |
|
7 |
|
|
1 |
|
|
— |
|
|
10 |
|
|
— |
|
|
— |
|
|
|
18 |
|
Total benefits, losses and expenses |
|
2,669 |
|
|
871 |
|
|
5 |
|
|
1,536 |
|
|
195 |
|
|
79 |
|
|
|
5,355 |
|
Income (loss) before income taxes |
|
649 |
|
|
(17 |
) |
|
11 |
|
|
183 |
|
|
53 |
|
|
(66 |
) |
|
|
813 |
|
Income tax expense (benefit) |
|
130 |
|
|
(5 |
) |
|
2 |
|
|
37 |
|
|
12 |
|
|
(14 |
) |
|
|
162 |
|
Net income (loss) |
|
519 |
|
|
(12 |
) |
|
9 |
|
|
146 |
|
|
41 |
|
|
(52 |
) |
|
|
651 |
|
Preferred stock dividends |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6 |
|
|
|
6 |
|
Net income (loss) available to common stockholders |
|
519 |
|
|
(12 |
) |
|
9 |
|
|
146 |
|
|
41 |
|
|
(58 |
) |
|
|
645 |
|
Adjustments to reconcile net income (loss) available to common stockholders to core earnings (loss) |
|
|
|
|
|
|
|
|
||||||||||||||
Net realized losses, excluded from core earnings, before tax |
|
29 |
|
|
5 |
|
|
1 |
|
|
28 |
|
|
4 |
|
|
9 |
|
|
|
76 |
|
Restructuring and other costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
1 |
|
Integration and other non-recurring M&A costs, before tax |
|
1 |
|
|
— |
|
|
— |
|
|
1 |
|
|
— |
|
|
— |
|
|
|
2 |
|
Income tax expense (benefit) |
|
(7 |
) |
|
(1 |
) |
|
1 |
|
|
(5 |
) |
|
— |
|
|
(4 |
) |
|
|
(16 |
) |
Core earnings (loss) |
$ |
542 |
|
$ |
(8 |
) |
$ |
11 |
|
$ |
170 |
|
$ |
45 |
|
$ |
(52 |
) |
|
$ |
708 |
|
The
DISCUSSION OF NON-GAAP FINANCIAL MEASURES
The
Annualized investment yield, excluding limited partnerships and other alternative investments - This non-GAAP measure is calculated as (a) the annualized net investment income, on a Consolidated, P&C or Group Benefits level, excluding limited partnerships and other alternative investments, divided by (b) the monthly average invested assets at amortized cost, as applicable, excluding derivatives book value and limited partnerships and other alternative investments. The Company believes that annualized investment yield, excluding limited partnerships and other alternative investments, provides investors with an important measure of the trend in investment earnings because it excludes the impact of the volatility in returns related to limited partnerships and other alternative investments. Annualized investment yield is the most directly comparable GAAP measure. A reconciliation of the annualized investment yield to annualized investment yield excluding limited partnerships and other alternatives investments for the quarterly periods ended September 30, 2024 and 2023 is provided in the table below.
Three Months Ended |
||||
|
Sept 30
|
Sept 30
|
||
|
Consolidated |
|||
Annualized investment yield |
4.4 |
% |
4.2 |
% |
Adjustment for income from limited partnerships and other alternative investments |
0.1 |
% |
(0.1 |
)% |
Annualized investment yield excluding limited partnerships and other alternative investments |
4.5 |
% |
4.1 |
% |
Book value per diluted share (excluding AOCI) - This is a non-GAAP per share measure that is calculated by dividing (a) common stockholders' equity, excluding AOCI, after tax, by (b) common shares outstanding and dilutive potential common shares. The Company provides this measure to enable investors to analyze the amount of the Company's net worth that is primarily attributable to the Company's business operations. The Company believes that excluding AOCI from the numerator is useful to investors because it eliminates the effect of items that can fluctuate significantly from period to period, primarily based on changes in interest rates. Book value per diluted share is the most directly comparable
|
As of |
|||||||
|
Sept 30
|
Dec 31
|
Change |
|||||
Book value per diluted share |
$ |
56.39 |
|
$ |
49.43 |
|
14.1 |
% |
Per diluted share impact of AOCI |
$ | 6.78 |
$ |
9.40 |
(27.9 |
%) |
||
Book value per diluted share (excluding AOCI) |
$ |
63.17 |
|
$ |
58.83 |
|
7.4 |
% |
|
As of |
|||||||
|
Sept 30
|
Sept 30
|
Change |
|||||
Book value per diluted share |
$ |
56.39 |
|
$ |
43.50 |
|
29.6 |
% |
Per diluted share impact of AOCI |
$ |
6.78 |
$ |
13.62 |
(50.2 |
%) |
||
Book value per diluted share (excluding AOCI) |
$ |
63.17 |
|
$ |
57.12 |
|
10.6 |
% |
Core earnings - The
-
Certain realized gains and losses - Generally realized gains and losses are primarily driven by investment decisions and external economic developments, the nature and timing of which are unrelated to the insurance and underwriting aspects of our business. Accordingly, core earnings excludes the effect of all realized gains and losses that tend to be highly variable from period to period based on capital market conditions. The
Hartford believes, however, that some realized gains and losses are integrally related to our insurance operations, so core earnings includes net realized gains and losses such as net periodic settlements on credit derivatives. These net realized gains and losses are directly related to an offsetting item included in the income statement such as net investment income. - Restructuring and other costs - Costs incurred as part of a restructuring plan are not a recurring operating expense of the business.
- Loss on extinguishment of debt - Largely consisting of make-whole payments or tender premiums upon paying debt off before maturity, these losses are not a recurring operating expense of the business.
- Gains and losses on reinsurance transactions - Gains or losses on reinsurance, such as those entered into upon sale of a business or to reinsure loss reserves, are not a recurring operating expense of the business.
- Integration and other non-recurring M&A costs - These costs, including transaction costs incurred in connection with an acquired business, are incurred over a short period of time and do not represent an ongoing operating expense of the business.
- Change in loss reserves upon acquisition of a business - These changes in loss reserves are excluded from core earnings because such changes could obscure the ability to compare results in periods after the acquisition to results of periods prior to the acquisition.
- Deferred gain resulting from retroactive reinsurance and subsequent changes in the deferred gain - Retroactive reinsurance agreements economically transfer risk to the reinsurers and excluding the deferred gain on retroactive reinsurance and related amortization of the deferred gain from core earnings provides greater insight into the economics of the business.
- Change in valuation allowance on deferred taxes related to non-core components of before tax income - These changes in valuation allowances are excluded from core earnings because they relate to non-core components of before tax income, such as tax attributes like capital loss carryforwards.
- Results of discontinued operations - These results are excluded from core earnings for businesses sold or held for sale because such results could obscure the ability to compare period over period results for our ongoing businesses.
In addition to the above components of net income available to common stockholders that are excluded from core earnings, preferred stock dividends declared, which are excluded from net income, are included in the determination of core earnings. Preferred stock dividends are a cost of financing more akin to interest expense on debt and are expected to be a recurring expense as long as the preferred stock is outstanding.
Net income (loss) and net income (loss) available to common stockholders are the most directly comparable
A reconciliation of net income (loss) to core earnings for the quarterly periods ended September 30, 2024 and 2023, for individual reporting segments can be found in this news release under the heading "The Hartford Financial Services Group, Inc. Consolidating Income Statements."
Core earnings margin - The
|
Three Months Ended |
|||||
Margin |
Sept 30
|
Sept 30
|
Change |
|||
Net income margin |
8.8 |
% |
8.5 |
% |
0.3 |
|
Adjustments to reconcile net income margin to core earnings margin: |
|
|
|
|||
Net realized gains, before tax |
(0.1 |
)% |
1.5 |
% |
(1.6 |
) |
Integration and other non-recurring M&A costs, before tax |
— |
% |
0.1 |
% |
(0.1 |
) |
Income tax expense benefit on items excluded from core earnings |
— |
% |
(0.3 |
)% |
0.3 |
|
Core earnings margin |
8.7 |
% |
9.8 |
% |
(1.1 |
) |
Core earnings per diluted share - This non-GAAP per share measure is calculated using the non-GAAP financial measure core earnings rather than the GAAP measure net income. The Company believes that core earnings per diluted share provides investors with a valuable measure of the Company's operating performance for the same reasons applicable to its underlying measure, core earnings. Net income (loss) available to common stockholders per diluted common share is the most directly comparable GAAP measure. Core earnings per diluted share should not be considered as a substitute for net income (loss) available to common stockholders per diluted common share and does not reflect the overall profitability of the Company's business. Therefore, the Company believes that it is useful for investors to evaluate net income (loss) available to common stockholders per diluted common share and core earnings per diluted share when reviewing the Company's performance. A reconciliation of net income available to common stockholders per diluted common share to core earnings per diluted share for the quarterly periods ended September 30, 2024 and 2023 is provided in the table below.
|
Three Months Ended |
|||||||
|
Sept 30
|
Sept 30
|
Change |
|||||
PER SHARE DATA |
|
|
|
|||||
Diluted earnings per common share: |
|
|
|
|||||
Net income available to common stockholders per share1 |
$ |
2.56 |
|
$ |
2.09 |
|
22 |
% |
Adjustments made to reconcile net income available to common stockholders per diluted share to core earnings per diluted share: |
|
|
|
|||||
Net realized losses (gains), excluded from core earnings, before tax |
|
0.04 |
|
|
0.25 |
|
(84 |
)% |
Integration and other non-recurring M&A costs, before tax |
|
0.01 |
|
|
0.01 |
|
— |
% |
Change in deferred gain on retroactive reinsurance, before tax |
|
(0.09 |
) |
|
— |
|
NM |
|
Income tax expense (benefit) on items excluded from core earnings |
|
0.01 |
|
|
(0.06 |
) |
NM |
|
Core earnings per diluted share |
$ |
2.53 |
|
$ |
2.29 |
|
10 |
% |
[1] Net income available to common stockholders includes dilutive potential common shares |
|
|
|
|||||
Core Earnings Return on Equity - The Company provides different measures of the return on stockholders' equity (ROE). Core earnings ROE is calculated based on non-GAAP financial measures. Core earnings ROE is calculated by dividing (a) the non-GAAP measure core earnings for the prior four fiscal quarters by (b) the non-GAAP measure average common stockholders' equity, excluding AOCI. Net income ROE is the most directly comparable
A reconciliation of consolidated net income available to common stockholders ROE to consolidated core earnings ROE is set forth below.
|
Last Twelve Months Ended |
|||
|
Sept 30
|
Sept 30
|
||
Net income available to common stockholders ROE |
20.0 |
% |
17.7 |
% |
Adjustments to reconcile net income available to common stockholders ROE to core earnings ROE: |
|
|
||
Net realized losses excluded from core earnings, before tax |
0.4 |
% |
0.9 |
% |
Restructuring and other costs, before tax |
— |
% |
0.1 |
% |
Integration and other non-recurring M&A costs, before tax |
0.1 |
% |
0.1 |
% |
Change in deferred gain on retroactive reinsurance, before tax |
0.7 |
% |
1.8 |
% |
Income tax benefit on items not included in core earnings |
(0.2 |
)% |
(0.6 |
)% |
Impact of AOCI, excluded from denominator of core earnings ROE |
(3.6 |
)% |
(5.1 |
)% |
Core earnings ROE |
17.4 |
% |
14.9 |
% |
Underlying combined ratio- This non-GAAP financial measure of underwriting results represents the combined ratio before catastrophes, prior accident year development and current accident year change in loss reserves upon acquisition of a business. Combined ratio is the most directly comparable GAAP measure. The Company believes this ratio is an important measure of the trend in profitability since it removes the impact of volatile and unpredictable catastrophe losses and prior accident year loss and loss adjustment expense reserve development. The changes to loss reserves upon acquisition of a business are excluded from underlying combined ratio because such changes could obscure the ability to compare results in periods after the acquisition to results of periods prior to the acquisition as such trends are valuable to our investors' ability to assess the Company's financial performance. A reconciliation of the combined ratio to the underlying combined ratio for individual reporting segments can be found in this news release under the heading "Business Results" for Commercial Lines" and "Personal Lines". A reconciliation of the combined ratio to underlying combined ratio for lines of business within the Company's P&C reporting segments is set forth below.
SMALL COMMERCIAL
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
Change |
|||
Combined ratio |
91.6 |
|
87.7 |
|
3.9 |
|
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(6.4 |
) |
(3.2 |
) |
(3.2 |
) |
Prior accident year development |
4.1 |
|
5.2 |
|
(1.1 |
) |
Underlying combined ratio |
89.3 |
|
89.7 |
|
(0.4 |
) |
MIDDLE & LARGE COMMERCIAL
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
Change |
|||
Combined ratio |
97.0 |
|
94.5 |
|
2.5 |
|
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(3.5 |
) |
(4.5 |
) |
1.0 |
|
Prior accident year development |
(3.3 |
) |
(1.8 |
) |
(1.5 |
) |
Underlying combined ratio |
90.2 |
|
88.1 |
|
2.1 |
|
GLOBAL SPECIALTY
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
Change |
|||
Combined ratio |
87.4 |
|
88.9 |
|
(1.5 |
) |
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(3.8 |
) |
(4.3 |
) |
0.5 |
|
Prior accident year development |
1.7 |
|
(0.3 |
) |
2.0 |
|
Underlying combined ratio |
85.3 |
|
84.3 |
|
1.0 |
|
PERSONAL LINES AUTO
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
Change |
|||
Combined ratio |
105.7 |
|
110.8 |
|
(5.1 |
) |
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(5.8 |
) |
(2.3 |
) |
(3.5 |
) |
Prior accident year development |
1.6 |
|
— |
|
1.6 |
|
Underlying combined ratio |
101.5 |
|
108.5 |
|
(7.0 |
) |
PERSONAL LINES HOMEOWNERS
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
Change |
|||
Combined ratio |
94.7 |
|
101.4 |
|
(6.7 |
) |
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(21.0 |
) |
(23.1 |
) |
2.1 |
|
Prior accident year development |
1.7 |
|
(0.3 |
) |
2.0 |
|
Underlying combined ratio |
75.4 |
|
78.1 |
|
(2.7 |
) |
Underwriting gain (loss) - The
Underlying underwriting gain (loss) - This non-GAAP measure of underwriting profitability represents underwriting gain (loss) before current accident year catastrophes, PYD and current accident year change in loss reserves upon acquisition of a business. The most directly comparable GAAP measure is net income (loss). The Company believes underlying underwriting gain (loss) is important to understand the Company’s periodic earnings because the volatile and unpredictable nature (i.e., the timing and amount) of catastrophes and prior accident year reserve development could obscure underwriting trends. The changes to loss reserves upon acquisition of a business are also excluded from underlying underwriting gain (loss) because such changes could obscure the ability to compare results in periods after the acquisition to results of periods prior to the acquisition as such trends are valuable to our investors' ability to assess the Company's financial performance. A reconciliation of net income (loss) to underlying underwriting gain (loss) for individual reporting segments for the quarterly periods ended September 30, 2024 and 2023, is set forth below.
COMMERCIAL LINES
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
||||
Net income |
$ |
528 |
|
$ |
519 |
|
Adjustments to reconcile net income to underwriting gain: |
|
|
||||
Net investment income |
|
(442 |
) |
|
(395 |
) |
Net realized losses |
|
32 |
|
|
38 |
|
Other income (expense) |
|
1 |
|
|
(2 |
) |
Income tax expense |
|
134 |
|
|
130 |
|
Underwriting gain |
|
253 |
|
|
290 |
|
Adjustments to reconcile underwriting gain to underlying underwriting gain: |
|
|
||||
Current accident year catastrophes |
|
155 |
|
|
115 |
|
Prior accident year development |
|
(36 |
) |
|
(46 |
) |
Underlying underwriting gain |
$ |
372 |
|
$ |
359 |
|
PERSONAL LINES
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
||||
Net income (loss) |
$ |
31 |
|
$ |
(12 |
) |
Adjustments to reconcile net income (loss) to underwriting loss: |
|
|
||||
Net investment income |
|
(58 |
) |
|
(47 |
) |
Net realized losses |
|
2 |
|
|
5 |
|
Net servicing and other income (expense) |
|
(5 |
) |
|
(3 |
) |
Income tax expense (benefit) |
|
8 |
|
|
(5 |
) |
Underwriting loss |
|
(22 |
) |
|
(62 |
) |
Adjustments to reconcile underwriting loss to underlying underwriting gain: |
|
|
||||
Current accident year catastrophes |
|
92 |
|
|
69 |
|
Prior accident year development |
|
(14 |
) |
|
1 |
|
Underlying underwriting gain |
$ |
56 |
|
$ |
8 |
|
Underlying loss and loss adjustment expense ratio - This non-GAAP financial measure of the loss and loss adjustment expense ratio for Commercial Lines and Personal Lines represents the loss and loss adjustment expense ratio before catastrophes and prior accident year development. The loss and loss adjustment expense ratio is the most directly comparable GAAP measure. The underlying loss and loss adjustment expense ratio is an important measure of the trend in profitability since it removes the impact of volatile and unpredictable catastrophe losses and prior accident year reserve development. A reconciliation of the loss and loss adjustment expense ratio to the underlying loss and loss adjustment expense ratio for the quarterly periods ended September 30, 2024 and 2023, is set forth below.
COMMERCIAL LINES
|
Three Months Ended |
||||||||
|
Sep 30
|
Sep 30
|
Change |
||||||
Loss and loss adjustment expense ratio |
|
|
|
||||||
Total losses and loss adjustment expenses |
61.0 |
|
58.9 |
|
2.1 |
|
|||
Current accident year catastrophes |
|
(4.8 |
) |
|
(3.9 |
) |
|
(0.9 |
) |
Prior accident year development |
|
1.1 |
|
|
1.6 |
|
|
(0.5 |
) |
Underlying loss and loss adjustment expense ratio |
|
57.3 |
|
|
56.6 |
|
|
0.7 |
|
PERSONAL LINES
|
Three Months Ended |
||||||||
|
Sep 30
|
Sep 30
|
Change |
||||||
Loss and loss adjustment expense ratio |
|
|
|
||||||
Total losses and loss adjustment expenses |
76.8 |
|
83.7 |
|
(6.9 |
) |
|||
Current accident year catastrophes |
|
(10.4 |
) |
|
(8.8 |
) |
|
(1.6 |
) |
Prior accident year development |
|
1.6 |
|
|
(0.1 |
) |
|
1.7 |
|
Underlying loss and loss adjustment expense ratio |
|
68.0 |
|
|
74.7 |
|
|
(6.7 |
) |
Net investment income, excluding limited partnerships and other alternative investments -This non-GAAP measure is the amount of net investment income, on a Consolidated, P&C or Group Benefits level earned from invested assets, excluding the net investment income related to limited partnerships and other alternative investments. The Company believes that net investment income, excluding limited partnerships and other alternative instruments, provides investors with an important measure of the trend in investment earnings because it excludes the impact of the volatility in returns related to limited partnerships and other alternative instruments. Net investment income is the most directly comparable GAAP measure. A reconciliation of net investment income to net investment income excluding limited partnerships and other alternative investments for the quarterly periods ended September 30, 2024 and 2023 is provided in the table below.
|
|
Three Months Ended |
|||||
|
Sept 30
|
Sept 30
|
||||
|
Consolidated |
|||||
Total net investment income |
$ |
659 |
|
$ |
597 |
|
Loss (income) from limited partnerships and other alternative assets |
|
(37 |
) |
|
(72 |
) |
Net investment income excluding limited partnerships and other alternative investments |
$ |
622 |
|
$ |
525 |
|
SAFE HARBOR STATEMENT
Certain of the statements contained herein are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes,” “estimates,” “expects,” “projects,” and similar references to future periods.
Forward-looking statements are based on management's current expectations and assumptions regarding future economic, competitive, legislative and other developments and their potential effect upon The Hartford Financial Services Group, Inc. and its subsidiaries (collectively, the "Company" or "The
- Risks Relating to Economic, Political and Global Market Conditions: challenges related to the Company’s current operating environment, including global political, economic and market conditions, and the effect of financial market disruptions, economic downturns, changes in trade regulation including tariffs and other barriers or other potentially adverse macroeconomic developments on the demand for our products and returns in our investment portfolios; market risks associated with our business, including changes in credit spreads, equity prices, interest rates, inflation rate, foreign currency exchange rates and market volatility; the impact on our investment portfolio if our investment portfolio is concentrated in any particular segment of the economy; the impacts of changing climate and weather patterns on our businesses, operations and investment portfolio including on claims, demand and pricing of our products, the availability and cost of reinsurance, our modeling data used to evaluate and manage risks of catastrophes and severe weather events, the value of our investment portfolios and credit risk with reinsurers and other counterparties;
- Insurance Industry and Product-Related Risks: the possibility of unfavorable loss development, including with respect to long-tailed exposures; the significant uncertainties that limit our ability to estimate the ultimate reserves necessary for asbestos and environmental claims; the possibility of a pandemic, civil unrest, earthquake, or other natural or man-made disaster that may adversely affect our businesses; weather and other natural physical events, including the intensity and frequency of thunderstorms, tornadoes, hail, wildfires, flooding, winter storms, hurricanes and tropical storms, as well as climate change and its potential impact on weather patterns; the possible occurrence of terrorist attacks and the Company’s inability to contain its exposure as a result of, among other factors, the inability to exclude coverage for terrorist attacks from workers' compensation policies and limitations on reinsurance coverage from the federal government under applicable laws; the Company’s ability to effectively price its products and policies, including its ability to obtain regulatory consents to pricing actions or to non-renewal or withdrawal of certain product lines; actions by competitors that may be larger or have greater financial resources than we do; technological changes, including usage-based methods of determining premiums, advancements in certain emerging technologies, including machine learning, predictive analytics, “big data” analysis or other artificial intelligence functions, advancements in automotive safety features, the development of autonomous vehicles, and platforms that facilitate ride sharing; the Company's ability to market, distribute and provide insurance products and investment advisory services through current and future distribution channels and advisory firms; the uncertain effects of emerging claim and coverage issues; political instability, politically motivated violence or civil unrest, which may increase the frequency and severity of insured losses; the ongoing effects of the COVID-19 pandemic, including exposure to COVID-19 business interruption property claims and the possibility of a resurgence of COVID-19 related losses in Group Benefits;
Financial Strength, Credit and Counterparty Risks: risks to our business, financial position, prospects and results associated with negative rating actions or downgrades in the Company’s financial strength and credit ratings or negative rating actions or downgrades relating to our investments; capital requirements which are subject to many factors, including many that are outside the Company’s control, such as National Association of Insurance Commissioners ("NAIC") risk based capital formulas, rating agency capital models, Funds at Lloyd's and Solvency Capital Requirement, which can in turn affect our credit and financial strength ratings, cost of capital, regulatory compliance and other aspects of our business and results; losses due to nonperformance or defaults by others, including credit risk with counterparties associated with investments, derivatives, premiums receivable, reinsurance recoverables and indemnifications provided by third parties in connection with previous dispositions; the potential for losses due to our reinsurers' unwillingness or inability to meet their obligations under reinsurance contracts and the availability, pricing and adequacy of reinsurance to protect the Company against losses; state and international regulatory limitations on the ability of the Company and certain of its subsidiaries to declare and pay dividends;
Risks Relating to Estimates, Assumptions and Valuations: risks associated with the use of analytical models in making decisions in key areas such as underwriting, pricing, capital management, reserving, investments, reinsurance and catastrophe risk management; the potential for differing interpretations of the methodologies, estimations and assumptions that underlie the Company’s fair value estimates for its investments and the evaluation of intent-to-sell impairments and allowance for credit losses on available-for-sale securities and mortgage loans; the potential for impairments of our goodwill;
Strategic and Operational Risks: the Company’s ability to maintain the availability of its systems and safeguard the security of its data in the event of a disaster, cyber or other information security incident or other unanticipated event; the potential for difficulties arising from outsourcing and similar third-party relationships; the risks, challenges and uncertainties associated with capital management plans, expense reduction initiatives and other actions; risks associated with acquisitions and divestitures, including the challenges of integrating acquired companies or businesses, which may result in our inability to achieve the anticipated benefits and synergies and may result in unintended consequences; difficulty in attracting and retaining talented and qualified personnel, including key employees, such as executives, managers and employees with strong technological, analytical and other specialized skills; the Company’s ability to protect its intellectual property and defend against claims of infringement;
Regulatory and Legal Risks: the cost and other potential effects of increased federal, state and international regulatory and legislative developments, including those that could adversely impact the demand for the Company’s products, operating costs and required capital levels; unfavorable judicial or legislative developments; the impact of changes in federal, state or foreign tax laws; regulatory requirements that could delay, deter or prevent a takeover attempt that stockholders might consider in their best interests; and the impact of potential changes in accounting principles and related financial reporting requirements.
Any forward-looking statement made by the Company in this document speaks only as of the date of this release. Factors or events that could cause the Company’s actual results to differ may emerge from time to time, and it is not possible for the Company to predict all of them. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise.
View source version on businesswire.com: https://www.businesswire.com/news/home/20241024971867/en/
Media Contacts:
Michelle Loxton
860-547-7413
michelle.loxton@thehartford.com
Matthew Sturdevant
860-547-8664
matthew.sturdevant@thehartford.com
Investor Contact:
Susan Spivak Bernstein
860-547-6233
susan.spivak@thehartford.com
Source: The
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