The Hartford Announces First Quarter 2025 Financial Results
-
First quarter 2025 net income available to common stockholders of
$625 million $2.15 16% from$748 million $2.47 $639 million $2.20 10% from$709 million $2.34 -
Net income ROE for the trailing 12 months of
18.8% and core earnings ROE* of16.2% . -
Property & Casualty (P&C) written premiums increased by
9% in the first quarter of 2025, driven by Business Insurance and Personal Insurance premium growth of10% and8% , respectively. - Business Insurance first quarter 2025 combined ratio of 94.4 and an underlying combined ratio* of 88.4, consistent with the 2024 period.
- Personal Insurance first quarter 2025 combined ratio of 106.1 and an underlying combined ratio* of 89.7, an improvement of 6.4 points compared with the 2024 period.
-
Employee Benefits first quarter net income margin of
7.4% and a core earnings margin* of7.6% , an improvement from6.1% in the 2024 period. -
P&C current accident year (CAY) catastrophe (CAT) losses in first quarter 2025 of
$467 million $325 million -
Returned
$550 million $400 million $150 million
* Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest
** All amounts and percentages set forth in this news release are approximate unless otherwise noted.
“The Hartford is off to a strong start in 2025, delivering a trailing 12-month core earnings ROE of 16.2 percent,” said The Hartford’s Chairman and CEO Christopher Swift. “Disciplined underwriting and pricing execution, exceptional talent, and innovative customer-centric solutions continue to drive our performance in a dynamic market environment that included elevated industry-wide catastrophe losses.”
The
Swift continued, “Our business performance is strong across the organization, and we remain steadfast in our commitment to delivering outstanding returns for our shareholders. We are well positioned to sustain our momentum, achieving profitable growth with industry-leading ROEs in 2025 and beyond."
CONSOLIDATED RESULTS:
|
Three Months Ended |
||
($ in millions except per share data) |
Mar 31
|
Mar 31
|
Change |
Net income available to common stockholders |
|
|
(16)% |
Net income available to common stockholders per diluted share1 |
|
|
(13)% |
|
|
|
|
Core earnings |
|
|
(10)% |
Core earnings per diluted share |
|
|
(6)% |
|
|
|
|
Book value per diluted share |
|
|
|
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 |
|
|
0.3 |
Core earnings ROE3, last 12-months |
|
|
(0.4) |
[1] Includes dilutive potential common shares; for net income available to common stockholders per diluted share, the numerator is net income less preferred dividends
[2] Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest [3] Return on equity (ROE) is calculated based on last 12-months net income available to common stockholders and core earnings, respectively; for net income ROE, the denominator is common stockholders’ equity including AOCI; for core earnings ROE, the denominator is common stockholders’ equity excluding AOCI |
|||
First quarter 2025 net income available to common stockholders of
Included in the first quarter 2025 net income was a benefit of
First quarter 2025 core earnings of
- Business Insurance loss and loss adjustment expense ratio of 62.8 compared with 58.3 in first quarter 2024, including 4.8 points of higher CATs and 0.7 points of more favorable PYD. Underlying loss and loss adjustment expense ratio of 56.9 compared with 56.6 in first quarter 2024.
- Personal Insurance loss and loss adjustment expense ratio of 79.1 compared with 76.3 in first quarter 2024, including 14.4 points of higher CATs and 3.4 points of more favorable PYD. Underlying loss and loss adjustment expense ratio* of 62.6 improved 8.1 points from first quarter 2024, largely due to the impact of earned pricing increases and lower frequency in automobile physical damage.
-
Net favorable prior accident year development (PYD) in core earnings of
$90 million $32 million -
Net investment income of
$656 million $593 million - Employee Benefits loss ratio of 71.9 improved 1.6 points compared with 73.5 in first quarter 2024, with improvement in both the group life and group disability loss ratios.
-
An increase in earnings generated by
9% growth in P&C earned premium. - The P&C expense ratio increased from first quarter 2024, driven by Personal Insurance, which includes higher direct marketing costs, partially offset by a decrease in the Business Insurance expense ratio.
March 31, 2025, book value per diluted share of
Book value per diluted share (excluding AOCI) of
Net income available to common stockholders' ROE (net income ROE) for the trailing 12-month period ending March 31, 2025, was
Core earnings ROE for the trailing 12-month period ending March 31, 2025, was
BUSINESS RESULTS:
Business Insurance
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Mar 31
|
Mar 31
|
Change |
Net income |
|
|
( |
Core earnings |
|
|
( |
Written premiums |
|
|
|
Underwriting gain1 |
|
|
( |
Underlying underwriting gain1 |
|
|
|
|
|
|
|
Losses and loss adjustment expense ratio |
62.8 |
58.3 |
4.5 |
Expenses |
31.3 |
31.5 |
(0.2) |
Policyholder dividends |
0.3 |
0.3 |
— |
Combined ratio |
94.4 |
90.1 |
4.3 |
Impact of catastrophes and PYD on combined ratio |
(5.9) |
(1.8) |
(4.1) |
Underlying combined ratio |
88.4 |
88.4 |
— |
|
|
|
|
Losses and loss adjustment expense ratio |
|
|
|
Underlying loss and loss adjustment expense ratio |
56.9 |
56.6 |
0.3 |
Current accident year catastrophes |
8.4 |
3.6 |
4.8 |
Favorable prior accident year development |
(2.5) |
(1.8) |
(0.7) |
Total Losses and loss adjustment expense ratio |
62.8 |
58.3 |
4.5 |
[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 |
|||
First quarter 2025 net income of
Business Insurance core earnings of
- An underlying loss and loss adjustment expense ratio of 56.9 in first quarter 2025 compared with 56.6 in first quarter 2024.
-
9% growth in earned premium. -
Net investment income of
$437 million $391 million -
Net favorable PYD within core earnings of
$51 million $32 million
Combined ratio of 94.4 compared with 90.1 in first quarter 2024, primarily due to a 4.5 point increase in the loss and loss adjustment expense ratio, including 4.8 points of higher CATs and 0.7 points of more favorable PYD (including 0.2 points of additional favorable development related to the amortization of the deferred gain). Underlying combined ratio of 88.4 was flat with first quarter 2024, primarily due to improvement in the expense ratio offset by a slight increase in the underlying loss and loss adjustment expense ratio.
- Small Business combined ratio of 93.3 compared with 89.0 in first quarter 2024, including 4.2 points of higher CAY CATs and 0.2 points of less favorable PYD. Underlying combined ratio of 89.4 improved from 89.6 in first quarter 2024.
- Middle & Large Business combined ratio of 99.8 compared with 94.0 in first quarter 2024, including 5.3 points of higher CAY CATs and 0.9 points of less unfavorable PYD. Underlying combined ratio of 90.6 compared with 89.2 in first quarter 2024, increased primarily due to slightly higher loss ratios across most lines, as expected, partially offset by improvement in the expense ratio.
- Global Specialty combined ratio of 89.3 compared with 87.8 in first quarter 2024, including 5.4 points of higher CAY CATs and 2.7 points of more favorable PYD. The combined ratio included 0.6 points of more favorable development due to the amortization of the deferred gain related to the Navigators ADC. Underlying combined ratio of 84.0 improved from 85.3 in first quarter 2024, primarily due to a lower loss ratio in global reinsurance and improvement in the expense ratio.
First quarter 2025 written premiums of
Personal Insurance
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Mar 31
|
Mar 31
|
Change |
Net income |
|
|
( |
Core earnings |
|
|
( |
Written premiums |
|
|
|
Underwriting loss |
|
|
NM |
Underlying underwriting gain |
|
|
|
|
|
|
|
Losses and loss adjustment expense ratio |
79.1 |
76.3 |
2.8 |
Expenses |
27.0 |
25.3 |
1.7 |
Combined ratio |
106.1 |
101.6 |
4.5 |
Impact of catastrophes and PYD on combined ratio |
(16.5) |
(5.5) |
(11.0) |
Underlying combined ratio |
89.7 |
96.1 |
(6.4) |
|
|
|
|
Losses and loss adjustment expense ratio |
|
|
|
Underlying loss and loss adjustment expense ratio |
62.6 |
70.7 |
(8.1) |
Current accident year catastrophes |
20.8 |
6.4 |
14.4 |
Favorable prior accident year development |
(4.3) |
(0.9) |
(3.4) |
Total Losses and loss adjustment expense ratio |
79.1 |
76.3 |
2.8 |
Net income of
Personal Insurance core earnings of
- An underlying loss and loss adjustment expense ratio of 62.6 in first quarter 2025, which improved 8.1 points from 70.7 in first quarter 2024, primarily driven by the impact of earned pricing increases and improvement in automobile physical damage frequency.
-
$39 million $7 million -
11% growth in earned premium. -
Net investment income of
$57 million $50 million
Combined ratio of 106.1 in first quarter 2025 compared with 101.6 in first quarter 2024, primarily due to a 2.8 point increase in the loss and loss adjustment expense ratio, including 14.4 points of higher CAY CAT losses, an 8.1 point improvement in the underlying loss and loss adjustment expense ratio, and more favorable PYD of 3.4 points, as well as a higher expense ratio. Underlying combined ratio of 89.7 improved 6.4 points from 96.1 in first quarter 2024, primarily due to improvement in the underlying loss and loss adjustment expense ratio in automobile and homeowners, partially offset by a 1.7 point increase in the expense ratio.
- Personal Automobile combined ratio of 93.5 improved 10.4 points from 103.9 in first quarter 2024. The underlying combined ratio of 96.1 improved 8.3 points from 104.4 in first quarter 2024, primarily due to improvement in the 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 automobile claim severities.
- Homeowners combined ratio of 133.2 compared with 96.2 in first quarter 2024, driven by 45.0 points of higher CAY CATs. The underlying combined ratio of 75.1 improved 1.9 points from 77.0 in first quarter 2024, primarily due to improvement in the underlying loss and loss adjustment expense ratio driven by the impact of double-digit earned pricing, partially offset by higher claim severities.
- The expense ratio of 27.0 increased 1.7 points from first quarter 2024, primarily driven by higher direct marketing costs and, to a lesser extent, a higher commission ratio, partially offset by the impact of higher earned premium.
Written premiums in first quarter 2025 were
-
Renewal written price increases in automobile and homeowners of
15.8% and12.3% , respectively, in response to elevated but moderating loss cost trends. -
An increase in new business in both homeowners and automobile from the first quarter of 2024, with homeowners increasing by
82% to$62 million 13% to$81 million - Flat effective policy count retention in both homeowners and automobile due to strong but moderating renewal written price increases.
Employee Benefits
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Mar 31
|
Mar 31
|
Change |
Net income |
|
|
|
Core earnings |
|
|
|
Fully insured ongoing premiums |
|
|
|
Loss ratio |
|
|
(1.6) |
Expense ratio |
|
|
0.0 |
Net income margin |
|
|
1.2 |
Core earnings margin |
|
|
1.5 |
Net income of
Fully insured ongoing premiums were up
Loss ratio of 71.9 improved 1.6 points from first quarter 2024.
- Group life loss ratio of 79.9 improved 2.7 points largely driven by lower mortality.
- Group disability loss ratio of 69.0 improved 1.1 points driven by improvement in the paid family and medical leave product loss ratio, partially offset by higher long-term disability incidence, although favorable to long-term historical averages.
Net investment income of
Hartford Funds
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Mar 31
|
Mar 31
|
Change |
Net income |
|
|
(4)% |
Core earnings |
|
|
|
Daily average Hartford Funds Assets Under Management (AUM) |
|
|
|
Mutual Funds and exchange-traded funds (ETF) net flows |
|
|
|
Total Hartford Funds AUM |
|
|
|
First quarter 2025 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) |
Mar 31
|
Mar 31
|
Change |
Net loss |
|
|
(173)% |
Net loss available to common stockholders |
|
|
(130)% |
Core loss |
|
|
(24)% |
Net investment income, before tax |
|
|
(13)% |
Interest expense and preferred dividends, before tax |
|
|
—% |
Net loss available to common stockholders of
INVESTMENT INCOME AND PORTFOLIO DATA:
|
Three Months Ended |
||
($ in millions, unless otherwise noted) |
Mar 31
|
Mar 31
|
Change |
Net investment income, before tax |
|
|
|
Annualized investment yield, before tax |
|
|
0.2 |
Annualized investment yield, before tax, excluding LPs1 |
|
|
0.1 |
Annualized LP yield, before tax |
|
|
1.8 |
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 |
|||
First quarter 2025 consolidated net investment income of
First quarter 2025 net investment income, excluding LPs*, of
First quarter 2025 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 Insurance Group, Inc. (formerly 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 INSURANCE GROUP, INC. |
||||||||||||||||||||||
CONSOLIDATING INCOME STATEMENTS |
||||||||||||||||||||||
Three Months Ended March 31, 2025 |
||||||||||||||||||||||
($ in millions) |
||||||||||||||||||||||
|
Business Insurance |
Personal Insurance |
P&C Other Ops |
Employee Benefits |
Hartford Funds |
Corporate |
|
Consolidated |
||||||||||||||
Earned premiums |
$ |
3,324 |
|
$ |
899 |
|
$ |
— |
|
$ |
1,612 |
|
$ |
— |
|
$ |
— |
|
|
$ |
5,835 |
|
Fee income |
|
11 |
|
|
8 |
|
|
— |
|
|
56 |
|
|
260 |
|
|
11 |
|
|
|
346 |
|
Net investment income |
|
437 |
|
|
57 |
|
|
18 |
|
|
126 |
|
|
4 |
|
|
14 |
|
|
|
656 |
|
Net realized losses |
|
(24 |
) |
|
(2 |
) |
|
— |
|
|
(4 |
) |
|
— |
|
|
(19 |
) |
|
|
(49 |
) |
Other revenue |
|
1 |
|
|
20 |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
22 |
|
Total revenues |
|
3,749 |
|
|
982 |
|
|
18 |
|
|
1,790 |
|
|
264 |
|
|
7 |
|
|
|
6,810 |
|
Benefits, losses, and loss adjustment expenses |
|
2,088 |
|
|
711 |
|
|
— |
|
|
1,199 |
|
|
— |
|
|
2 |
|
|
|
4,000 |
|
Amortization of DAC |
|
531 |
|
|
68 |
|
|
— |
|
|
8 |
|
|
— |
|
|
— |
|
|
|
607 |
|
Insurance operating costs and other expenses |
|
524 |
|
|
197 |
|
|
2 |
|
|
406 |
|
|
209 |
|
|
14 |
|
|
|
1,352 |
|
Interest expense |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
50 |
|
|
|
50 |
|
Amortization of other intangible assets |
|
7 |
|
|
1 |
|
|
— |
|
|
10 |
|
|
— |
|
|
— |
|
|
|
18 |
|
Total benefits, losses and expenses |
|
3,150 |
|
|
977 |
|
|
2 |
|
|
1,623 |
|
|
209 |
|
|
66 |
|
|
|
6,027 |
|
Income (loss) before income taxes |
|
599 |
|
|
5 |
|
|
16 |
|
|
167 |
|
|
55 |
|
|
(59 |
) |
|
|
783 |
|
Income tax expense (benefit) |
|
122 |
|
|
— |
|
|
3 |
|
|
34 |
|
|
12 |
|
|
(18 |
) |
|
|
153 |
|
Net income (loss) |
|
477 |
|
|
5 |
|
|
13 |
|
|
133 |
|
|
43 |
|
|
(41 |
) |
|
|
630 |
|
Preferred stock dividends |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5 |
|
|
|
5 |
|
Net income (loss) available to common stockholders |
|
477 |
|
|
5 |
|
|
13 |
|
|
133 |
|
|
43 |
|
|
(46 |
) |
|
|
625 |
|
Adjustments to reconcile net income (loss) available to common stockholders to core earnings (loss) |
|
|
|
|
|
|
|
|
||||||||||||||
Net realized losses, excluded from core earnings, before tax |
|
22 |
|
|
2 |
|
|
— |
|
|
4 |
|
|
— |
|
|
19 |
|
|
|
47 |
|
Integration and other non-recurring M&A costs, before tax |
|
2 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
2 |
|
Change in deferred gain on retroactive reinsurance, before tax |
|
(32 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
(32 |
) |
Income tax expense (benefit) |
|
2 |
|
|
(1 |
) |
|
— |
|
(1 |
) |
|
1 |
|
(4 |
) |
|
|
(3 |
) |
||
Core earnings (loss) |
$ |
471 |
|
$ |
6 |
|
$ |
13 |
|
$ |
136 |
|
$ |
44 |
|
$ |
(31 |
) |
|
$ |
639 |
|
THE HARTFORD INSURANCE GROUP, INC. |
||||||||||||||||||||||
CONSOLIDATING INCOME STATEMENTS |
||||||||||||||||||||||
Three Months Ended March 31, 2024 |
||||||||||||||||||||||
($ in millions) |
||||||||||||||||||||||
|
Business Insurance |
Personal Insurance |
P&C Other Ops |
Employee Benefits |
Hartford Funds |
Corporate |
|
Consolidated |
||||||||||||||
Earned premiums |
$ |
3,048 |
|
$ |
813 |
|
$ |
— |
|
$ |
1,585 |
|
$ |
— |
|
$ |
— |
|
|
$ |
5,446 |
|
Fee income |
|
11 |
|
|
8 |
|
|
— |
|
|
54 |
|
|
250 |
|
|
10 |
|
|
|
333 |
|
Net investment income |
|
391 |
|
|
50 |
|
|
18 |
|
|
114 |
|
|
4 |
|
|
16 |
|
|
|
593 |
|
Net realized gains |
|
12 |
|
|
1 |
|
|
— |
|
|
1 |
|
|
5 |
|
|
9 |
|
|
|
28 |
|
Other revenue |
|
— |
|
|
19 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
19 |
|
Total revenues |
|
3,462 |
|
|
891 |
|
|
18 |
|
|
1,754 |
|
|
259 |
|
|
35 |
|
|
|
6,419 |
|
Benefits, losses, and loss adjustment expenses |
|
1,778 |
|
|
620 |
|
|
7 |
|
|
1,204 |
|
|
— |
|
|
2 |
|
|
|
3,611 |
|
Amortization of DAC |
|
476 |
|
|
60 |
|
|
— |
|
|
9 |
|
|
— |
|
|
— |
|
|
|
545 |
|
Insurance operating costs and other expenses |
|
499 |
|
|
168 |
|
|
2 |
|
|
397 |
|
|
203 |
|
|
14 |
|
|
|
1,283 |
|
Restructuring and other costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
1 |
|
Interest expense |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
50 |
|
|
|
50 |
|
Amortization of other intangible assets |
|
7 |
|
|
1 |
|
|
— |
|
|
10 |
|
|
— |
|
|
— |
|
|
|
18 |
|
Total benefits, losses and expenses |
|
2,760 |
|
|
849 |
|
|
9 |
|
|
1,620 |
|
|
203 |
|
|
67 |
|
|
|
5,508 |
|
Income (loss) before income taxes |
|
702 |
|
|
42 |
|
|
9 |
|
|
134 |
|
|
56 |
|
|
(32 |
) |
|
|
911 |
|
Income tax expense (benefit) |
|
129 |
|
|
8 |
|
|
1 |
|
|
26 |
|
|
11 |
|
|
(17 |
) |
|
|
158 |
|
Net income (loss) |
|
573 |
|
|
34 |
|
|
8 |
|
|
108 |
|
|
45 |
|
|
(15 |
) |
|
|
753 |
|
Preferred stock dividends |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5 |
|
|
|
5 |
|
Net income (loss) available to common stockholders |
|
573 |
|
|
34 |
|
|
8 |
|
|
108 |
|
|
45 |
|
|
(20 |
) |
|
|
748 |
|
Adjustments to reconcile net income (loss) available to common stockholders to core earnings (loss) |
|
|
|
|
|
|
|
|
||||||||||||||
Net realized gains, excluded from core earnings, before tax |
|
(13 |
) |
|
(2 |
) |
|
— |
|
|
(1 |
) |
|
(5 |
) |
|
(9 |
) |
|
|
(30 |
) |
Restructuring and other costs |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1 |
|
|
|
1 |
|
Integration and other non-recurring M&A costs, before tax |
|
2 |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
2 |
|
Change in deferred gain on retroactive reinsurance, before tax |
|
(24 |
) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
(24 |
) |
Income tax expense (benefit) |
|
8 |
|
|
1 |
|
|
(1 |
) |
|
— |
|
|
1 |
|
|
3 |
|
|
|
12 |
|
Core earnings (loss) |
$ |
546 |
|
$ |
33 |
|
$ |
7 |
|
$ |
107 |
|
$ |
41 |
|
$ |
(25 |
) |
|
$ |
709 |
|
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, 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
Three Months Ended |
||||
|
Mar 31
|
Mar 31
|
||
Annualized investment yield |
4.3 |
% |
4.1 |
% |
Adjustment for income from limited partnerships and other alternative investments |
0.1 |
% |
0.2 |
% |
Annualized investment yield excluding limited partnerships and other alternative investments |
4.4 |
% |
4.3 |
% |
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 |
|||
|
Mar 31
|
Dec 31
|
Change |
Book value per diluted share |
|
|
|
Per diluted share impact of AOCI |
|
|
( |
Book value per diluted share (excluding AOCI) |
|
|
|
|
As of |
||
|
Mar 31
|
Mar 31
|
Change |
Book value per diluted share |
|
|
|
Per diluted share impact of AOCI |
|
|
( |
Book value per diluted share (excluding AOCI) |
|
|
|
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 March 31, 2025 and 2024, for individual reporting segments can be found in this news release under the heading "The Hartford Insurance Group, Inc. Consolidating Income Statements."
Core earnings margin - The
|
Three Months Ended |
||
Margin |
Mar 31
|
Mar 31
|
Change |
Net income margin |
|
|
1.2 |
Adjustments to reconcile net income margin to core earnings margin: |
|
|
|
Net realized losses (gains), before tax |
|
(0.1)% |
0.4 |
Income tax benefit on items excluded from core earnings |
(0.1)% |
—% |
(0.1) |
Core earnings margin |
|
|
1.5 |
Core earnings per diluted share - This non-GAAP per share measure is calculated using the non-GAAP financial measure core earnings rather than the
|
Three Months Ended |
||
|
Mar 31
|
Mar 31
|
Change |
PER SHARE DATA |
|
|
|
Diluted earnings per common share: |
|
|
|
Net income available to common stockholders per share1 |
|
|
(13)% |
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 |
0.16 |
(0.10) |
NM |
Integration and other non-recurring M&A costs, before tax |
0.01 |
0.01 |
—% |
Change in deferred gain on retroactive reinsurance, before tax |
(0.11) |
(0.08) |
(38)% |
Income tax expense (benefit) on items excluded from core earnings |
(0.01) |
0.04 |
NM |
Core earnings per diluted share |
|
|
(6)% |
[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.
|
Three Months Ended |
|
|
Mar 31 2025 |
Mar 31 2024 |
Net income available to common stockholders ROE |
|
|
Adjustments to reconcile net income available to common stockholders ROE to core earnings ROE: |
|
|
Net realized losses excluded from core earnings, before tax |
|
|
Integration and other non-recurring M&A costs, before tax |
|
|
Change in deferred gain on retroactive reinsurance, before tax |
(0.6)% |
|
Income tax benefit on items not included in core earnings |
(0.1)% |
(0.4)% |
Impact of AOCI, excluded from denominator of core earnings ROE |
(2.8)% |
(3.6)% |
Core earnings ROE |
|
|
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
SMALL BUSINESS
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Combined ratio |
93.3 |
|
89.0 |
|
4.3 |
|
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(8.0 |
) |
(3.8 |
) |
(4.2 |
) |
Prior accident year development |
4.1 |
|
4.3 |
|
(0.2 |
) |
Underlying combined ratio |
89.4 |
|
89.6 |
|
(0.2 |
) |
MIDDLE & LARGE BUSINESS
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Combined ratio |
99.8 |
|
94.0 |
|
5.8 |
|
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(8.9 |
) |
(3.6 |
) |
(5.3 |
) |
Prior accident year development |
(0.3 |
) |
(1.2 |
) |
0.9 |
|
Underlying combined ratio |
90.6 |
|
89.2 |
|
1.4 |
|
GLOBAL SPECIALTY
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Combined ratio |
89.3 |
|
87.8 |
|
1.5 |
|
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(8.7 |
) |
(3.3 |
) |
(5.4 |
) |
Prior accident year development |
3.4 |
|
0.7 |
|
2.7 |
|
Underlying combined ratio |
84.0 |
|
85.3 |
|
(1.3 |
) |
PERSONAL AUTOMOBILE
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Combined ratio |
93.5 |
|
103.9 |
|
(10.4 |
) |
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(1.2 |
) |
(1.0 |
) |
(0.2 |
) |
Prior accident year development |
3.8 |
|
1.6 |
|
2.2 |
|
Underlying combined ratio |
96.1 |
|
104.4 |
|
(8.3 |
) |
HOMEOWNERS
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Combined ratio |
133.2 |
|
96.2 |
|
37.0 |
|
Adjustment to reconcile combined ratio to underlying combined ratio: |
|
|
|
|||
Current accident year catastrophes |
(63.7 |
) |
(18.7 |
) |
(45.0 |
) |
Prior accident year development |
5.6 |
|
(0.5 |
) |
6.1 |
|
Underlying combined ratio |
75.1 |
|
77.0 |
|
(1.9 |
) |
Underwriting gain (loss) - This non-GAAP financial measure is a before tax measure that represents earned premiums less incurred losses, loss adjustment expenses and underwriting expenses. Net income (loss) is the most directly comparable
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
BUSINESS INSURANCE
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
||||
Net income |
$ |
477 |
|
$ |
573 |
|
Adjustments to reconcile net income to underwriting gain: |
|
|
||||
Net investment income |
|
(437 |
) |
|
(391 |
) |
Net realized losses (gains) |
|
24 |
|
|
(12 |
) |
Other (expense) income |
|
1 |
|
|
2 |
|
Income tax expense |
|
122 |
|
|
129 |
|
Underwriting gain |
|
187 |
|
|
301 |
|
Adjustments to reconcile underwriting gain to underlying underwriting gain: |
|
|
||||
Current accident year catastrophes |
|
280 |
|
|
109 |
|
Prior accident year development |
|
(83 |
) |
|
(56 |
) |
Underlying underwriting gain |
$ |
384 |
|
$ |
354 |
|
PERSONAL INSURANCE
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
||||
Net income |
$ |
5 |
|
$ |
34 |
|
Adjustments to reconcile net income (loss) to underwriting loss: |
|
|
||||
Net investment income |
|
(57 |
) |
|
(50 |
) |
Net realized losses (gains) |
|
2 |
|
|
(1 |
) |
Net servicing and other income |
|
(5 |
) |
|
(4 |
) |
Income tax expense |
|
— |
|
|
8 |
|
Underwriting gain (loss) |
|
(55 |
) |
|
(13 |
) |
Adjustments to reconcile underwriting loss to underlying underwriting gain: |
|
|
||||
Current accident year catastrophes |
|
187 |
|
|
52 |
|
Prior accident year development |
|
(39 |
) |
|
(7 |
) |
Underlying underwriting gain |
$ |
93 |
|
$ |
32 |
|
Underlying loss and loss adjustment expense ratio - This non-GAAP financial measure is the cost of non-catastrophe loss and loss adjustment expenses incurred in the current accident year divided by earned premiums. The loss and loss adjustment expense ratio is the most directly comparable
PROPERTY & CASUALTY
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Loss and loss adjustment expense ratio |
66.3 |
|
62.3 |
|
4.0 |
|
Adjustment to reconcile loss and loss adjustment expense ratio to underlying loss and loss adjustment expense ratio: |
|
|
|
|||
Current accident year catastrophes and prior accident year development |
(8.2 |
) |
(2.7 |
) |
(5.5 |
) |
Underlying loss and loss adjustment expense ratio |
58.1 |
|
59.6 |
|
(1.5 |
) |
BUSINESS INSURANCE
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Loss and loss adjustment expense ratio |
62.8 |
|
58.3 |
|
4.5 |
|
Adjustment to reconcile loss and loss adjustment expense ratio to underlying loss and loss adjustment expense ratio: |
|
|
|
|||
Current accident year catastrophes and prior accident year development |
(5.9 |
) |
(1.8 |
) |
(4.1 |
) |
Underlying loss and loss adjustment expense ratio |
56.9 |
|
56.6 |
|
0.3 |
|
PERSONAL INSURANCE
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Loss and loss adjustment expense ratio |
79.1 |
|
76.3 |
|
2.8 |
|
Adjustment to reconcile loss and loss adjustment expense ratio to underlying loss and loss adjustment expense ratio: |
|
|
|
|||
Current accident year catastrophes and prior accident year development |
(16.5 |
) |
(5.5 |
) |
(11.0 |
) |
Underlying loss and loss adjustment expense ratio |
62.6 |
|
70.7 |
|
(8.1 |
) |
PERSONAL INSURANCE - AUTOMOBILE
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Loss and loss adjustment expense ratio |
67.3 |
|
79.5 |
|
(12.2 |
) |
Adjustment to reconcile loss and loss adjustment expense ratio to underlying loss and loss adjustment expense ratio: |
|
|
|
|||
Current accident year catastrophes and prior accident year development |
2.5 |
0.5 |
2.0 |
|
||
Underlying loss and loss adjustment expense ratio |
69.9 |
|
79.9 |
|
(10.0 |
) |
PERSONAL INSURANCE - HOMEOWNERS
|
Three Months Ended |
|||||
|
Mar 31
|
Mar 31
|
Change |
|||
Loss and loss adjustment expense ratio |
104.3 |
|
68.8 |
|
35.5 |
|
Adjustment to reconcile loss and loss adjustment expense ratio to underlying loss and loss adjustment expense ratio: |
|
|
|
|||
Current accident year catastrophes and prior accident year development |
(58.1 |
) |
(19.2 |
) |
(38.9 |
) |
Underlying loss and loss adjustment expense ratio |
46.3 |
|
49.6 |
|
(3.3 |
) |
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 Insurance 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;
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 breach or other information security incident, technology failure 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/20250424191318/en/
Media Contacts:
Michelle Loxton
860-547-7413
michelle.loxton@thehartford.com
Matthew Sturdevant
860-547-8664
matthew.sturdevant@thehartford.com
Investor Contact:
Kate Jorens
860-547-4066
kate.jorens@thehartford.com
Source: The
