73 unchanged sentences
Reconciliation of Net Income to Core Earnings
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 2023 2022
Net income $ 547 $ 444 $ 1,082 $ 887
4 unchanged sentences
Restructuring and other costs, before tax 3 2 3 7
+Added: Loss on extinguishment of debt, before tax — 9 — 9
Integration and other non-recurring M&A costs, before tax 2 6 4 11
19 unchanged sentences
Underwriting expenses include the amortization of deferred policy acquisition costs ("DAC") and insurance operating costs and other expenses, including certain centralized services costs and bad debt expense.
−Removed: DAC includes commissions, taxes, licenses and fees and other incremental
−Removed: direct underwriting expenses and are amortized over the policy term.
+Added: commissions, taxes, licenses and fees and other incremental direct underwriting expenses and are amortized over the policy term.
The expense ratio for Group Benefits is expressed as the ratio of insurance operating costs and other expenses including amortization of intangibles and amortization of DAC, to premiums and other considerations, excluding buyout premiums.
8 unchanged sentences
The loss and loss adjustment expense ratio is affected by claim frequency and claim severity, particularly for shorter-tail property lines of business, where the emergence of claim frequency and severity is credible and likely indicative of ultimate losses.
−Removed: Claim frequency represents the percentage change in the average number of reported claims per unit of exposure in the current accident year compared to that of the previous accident year.
−Removed: Claim severity represents the percentage change in the estimated average cost per claim in the current accident year
+Added: Claim frequency represents the percentage change in the average number of reported claims per unit of exposure in the current
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: compared to that of the previous accident year.
+Added: accident year compared to that of the previous accident year.
+Added: Claim severity represents the percentage change in the estimated average cost per claim in the current accident year compared to that of the previous accident year.
As one of the factors used to determine pricing, the Company’s practice is to first make an overall assumption about claim frequency and severity for a given line of business and then, as part of the rate-making process, adjust the assumption as appropriate for the particular state, product or coverage.
13 unchanged sentences
Policies in Force- Represents the number of policies with coverage in effect as of the end of the period.
−Removed: The number of policies in force is a growth measure used for Personal Lines and standard commercial lines (small commercial and middle market lines within middle & large commercial) and is affected by both new business growth and policy count retention.
+Added: The number of policies in force is a growth measure used for Personal Lines
+Added: and standard commercial lines (small commercial and middle market lines within middle & large commercial) and is affected by both new business growth and policy count retention.
Policyholder Dividend Ratio- The ratio of policyholder dividends to earned premium.
−Removed: Premium Retention - For middle and large commercial, represents the ratio of prior period premiums that were successfully renewed divided by premiums associated with policies available for renewal in the current period.
+Added: Premium Retention- For middle & large commercial, represents the ratio of prior period premiums that were successfully renewed divided by premiums associated with policies available for renewal in the current period.
Premium retention excludes premium amounts from annual audits, renewal written price increases and changes in exposure, including amount of insurance.
11 unchanged sentences
Renewal written price changes reflect the property and casualty insurance market cycle.
−Removed: Prices tend to increase for a particular line of business when insurance carriers have incurred significant losses in that line of business in the recent past or the industry as a whole commits less of its capital to writing exposures in that line of business.
−Removed: Prices tend to decrease when recent loss experience has been favorable or
+Added: Prices tend to increase for a particular line of business when insurance carriers
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: when competition among insurance carriers increases.
+Added: have incurred significant losses in that line of business in the recent past or the industry as a whole commits less of its capital to writing exposures in that line of business.
+Added: Prices tend to decrease when recent loss experience has been favorable or when competition among insurance carriers increases.
Renewal written price statistics are subject to change from period to period, based on a number of factors, including changes in actuarial estimates and the effect of subsequent cancellations and non-renewals, and modifications made to better reflect ultimate pricing achieved.
8 unchanged sentences
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.
−Removed: Combined ratio is the most directly comparable GAAP measure.
−Removed: The Company believes this ratio is an important measure of the trend in profitability since it removes
−Removed: the impact of volatile and unpredictable catastrophe losses and prior accident year loss and loss adjustment expense reserve development.
+Added: Combined ratio is the most directly comparable
+Added: GAAP measure.
+Added: 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.
10 unchanged sentences
Reconciliation of Net Income to Underwriting Gain (Loss)
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 2023 2022
Commercial Lines
2 unchanged sentences
Net investment income (364) (356) (702) (689)
−Removed: Net realized gains 19 91
+Added: Net realized losses 51 198 70 289
Other expense — 1 — 7
3 unchanged sentences
Net income (loss) $ (60) $ 6 $ (61) $ 83
−Removed: Adjustments to reconcile net income to underwriting gain (loss):
+Added: Adjustments to reconcile net income (loss) to underwriting gain (loss):
Net investment income (34) (35) (72) (68)
−Removed: Net realized gains 1 9
+Added: Net realized losses 5 18 6 27
Net servicing and other expense (income) (7) (3) (13) (7)
2 unchanged sentences
P&C Other Operations
−Removed: Net income $ 6 $ 8
−Removed: Adjustments to reconcile net income to underwriting loss:
+Added: Net income (loss) $ 9 $ (20) $ 15 $ (12)
+Added: Adjustments to reconcile net income (loss) to underwriting loss:
Net investment income (17) (16) (33) (32)
Net realized gains 1 9 4 13
−Removed: Income tax expense 1 1
+Added: Income tax expense (benefit) 3 (5) 4 (4)
Underwriting loss $ (4) $ (32) $ (10) $ (35)
14 unchanged sentences
The Company includes in the Corporate category reserves for run-off structured settlement and terminal funding agreement liabilities, restructuring costs, capital raising activities (including equity financing, debt financing and related interest expense), transaction expenses incurred in connection with an acquisition, certain M&A costs, purchase accounting adjustments related to goodwill and other expenses not allocated to the reporting segments.
−Removed: Corporate also includes investment management fees and expenses related to managing third party business, including management of a portion of the invested assets of Talcott Resolution Life, Inc.
−Removed: and its subsidiaries as well as certain of Talcott's affiliates.
+Added: Corporate also includes investment management fees and expenses related to managing third-party business.
The Company derives its revenues principally from:
11 unchanged sentences
This agreement provides an important competitive advantage given the size of the 50 plus population and the strength of the AARP brand.
−Removed: Similar to property and casualty, profitability of the group benefits business depends, in large part, on the ability to evaluate and price risks appropriately and make reliable
−Removed: estimates of mortality, morbidity, disability and longevity.
−Removed: To manage the pricing risk, Group Benefits generally offers term insurance policies, allowing for the adjustment of rates or policy terms in order to minimize the adverse effect of market trends, loss costs, declining interest rates and other factors.
+Added: Similar to property and casualty, profitability of the group benefits business depends, in large part, on the ability to evaluate and price risks appropriately and make reliable estimates of mortality, morbidity, disability and longevity.
+Added: To manage the pricing risk, Group Benefits generally offers term insurance policies, allowing for the adjustment of rates or policy
+Added: terms in order to minimize the adverse effect of market trends, loss costs, declining interest rates and other factors.
However, as policies are typically sold with rate guarantees an average of three years, pricing for the Company’s products could prove to be inadequate if loss and expense trends emerge adversely during the rate guarantee period or if investment returns are lower than expected at the time the products were sold.
20 unchanged sentences
To achieve those expected savings, we expect to incur approximately $388 over the course of the program, with $308
−Removed: expensed cumulatively through March 31, 2023, and expected expenses of $27 over the last nine months of 2023 and $62 after 2023, with the expenses after 2023 consisting mostly of amortization of internal use software and capitalized real estate costs.
+Added: expensed cumulatively through June 30, 2023, and expected expenses of $17 over the last six months of 2023 and $63 after 2023, with the expenses after 2023 consisting mostly of amortization of internal use software and capitalized real estate costs.
Included in the estimated costs of $388, we expect to incur restructuring costs of approximately $127, including $38 of employee severance, $24 to retire certain IT applications, and $65 for consulting and lease termination expenses.
Restructuring costs are reported as a charge to net income but not in core earnings.
−Removed: The following table presents Hartford Next program costs incurred, including restructuring costs, and expense savings relative to 2019 realized in the three months ended March 31, 2023 and expected annual costs and expense savings relative to 2019 for the full year in 2023:
+Added: The following table presents Hartford Next program costs incurred, including restructuring costs, and expense savings relative to 2019 realized in the six months ended June 30, 2023 and expected annual costs and expense savings relative to 2019 for the full year in 2023.
Hartford Next Costs and Expense Savings
−Removed: Three Months Ended March 31, 2023 Estimate for 2023
+Added: Six Months Ended June 30, 2023 Estimate for 2023
Employee severance $ (3) $ (3)
19 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: FIRST QUARTER FINANCIAL HIGHLIGHTS
+Added: SECOND QUARTER FINANCIAL HIGHLIGHTS
Net Income Available to Common Stockholders Net Income Available to Common Stockholders per Diluted Share Book Value per Diluted Share
1 unchanged sentence
+ Lower net realized losses
−Removed: + Increase in net income available to common stockholders + An increase in common stockholders' equity largely due to a increase in AOCI, primarily driven by lower net unrealized losses on available for sale securities
−Removed: + In Group Benefits, lower mortality claims and the effect of higher premiums
+Added: + Increase in net income available to common stockholders + Net income in excess of common stockholder dividends
+Added: + The effect of higher premiums in P&C and Group Benefits
+ Reduction in outstanding shares due to share repurchases
−Removed: + Lower interest expense on corporate debt
−Removed: + Net income in excess of common stockholder dividends
−Removed: + In Commercial Lines and Personal Lines, the effect of higher earned premiums
−Removed: - Dilutive effect of share repurchases
+Added: + An increase in AOCI, primarily driven by lower net unrealized losses on available for sale securities
- Higher P&C current accident year catastrophe losses
+Added: - Dilutive effect of share repurchases
- A higher current accident year loss ratio before catastrophes in Personal Lines
−Removed: - Favorable P&C prior accident year reserve development in the prior year period
+Added: - A higher group life loss ratio
+Added: - Less favorable P&C prior accident year reserve development
Investment Yield, After Tax Property & Casualty Combined Ratio Group Benefits Net Income Margin
−Removed: Ý Increased 10 bps Ý Increased 5.3 points Ý Increased 5.8 points
−Removed: + A higher yield on fixed maturity securities due to an increased yield on variable-rate securities and reinvesting at higher rates + Higher current accident year catastrophe losses + Lower mortality claims in group life
−Removed: + A lower group disability loss ratio due to favorable long-term disability claim incidence
−Removed: + Higher personal automobile loss costs, driven by severity
+Added: Þ Decreased 10 bps Ý Increased 4.8 points Ý Increased 0.3 points
- Lower returns on limited partnerships and other alternative investments
−Removed: + Favorable prior accident year reserve development in the prior year period
+Added: + Higher current accident year catastrophe losses + Lower net realized losses
+ Higher fully insured ongoing premiums
−Removed: + A change to net realized gains
−Removed: + Higher current accident year loss ratio in workers' compensation
−Removed: - Higher insurance operating costs and other expenses
−Removed: - Lower current accident year losses in international - Lower net investment income driven by lower income from limited partnerships
−Removed: - A lower expense ratio driven, in part, by higher earned premium
+Added: + A higher yield on fixed maturity securities due to an increased yield on variable-rate securities and reinvesting at higher rates + Higher personal automobile loss costs, driven by severity - Higher group life loss ratio
+Added: - Lower net investment income driven by lower income from limited partnerships
+Added: + A lower level of favorable prior accident year reserve development
+Added: - A slightly higher group disability loss ratio primarily due to higher paid family leave and short-term disability claim incidence
+Added: - A lower expense ratio primarily driven by higher earned premium and lower marketing spend in Personal Lines
Index to MD&A
4 unchanged sentences
Consolidated Results of Operations
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Earned premiums $ 5,220 $ 4,810 9 % $ 10,283 $ 9,461 9 %
16 unchanged sentences
Net income available to common stockholders $ 542 $ 439 23 % $ 1,072 $ 877 22 %
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
+Added: Three months ended June 30, 2023 compared to the three months ended June 30, 2022
Net income available to common stockholders increased by $103, primarily driven by:
−Removed: • Lower realized losses of $138, before tax, driven by a change to net gains on equity securities in the current period compared to net losses in the prior period;
−Removed: • In Group Benefits, an improved group life loss ratio driven by lower mortality, the effect of higher fully insured ongoing premiums, and an improved group disability loss ratio, partially offset by an increase in insurance operating costs and other expenses and lower net investment income;
−Removed: • A lower level of interest expense on corporate debt.
+Added: • Lower net realized losses of $274, before tax, driven by a decline in value of equity securities in the 2022 period;
+Added: • In Group Benefits, the effect of higher fully insured ongoing premiums, including a lower expense ratio, partially offset by a higher group life loss ratio and lower net investment income;
+Added: • A loss on extinguishment of debt in the 2022 period.
These increases were partially offset by:
−Removed: • A decrease in P&C underwriting results of $157, before tax, driven by higher current accident year catastrophe losses, a higher current accident year loss and loss adjustment expense ("LAE") ratio before catastrophes in Personal Lines, favorable prior accident year reserve development in the 2022 period, and higher underwriting expenses, partially offset by the effect of earned premium growth.
+Added: • A decrease in P&C underwriting gain of $151, before tax, driven by higher current accident year catastrophe losses, a higher current accident year loss and loss adjustment expense ("LAE") ratio before catastrophes in Personal Lines, and a lower level of favorable prior accident year reserve development, partially offset by the effect of earned premium growth, including a decrease in the expense ratio.
For a discussion of the Company's operating results by segment, see MD&A - Segment Operating Summaries.
4 unchanged sentences
Earned premiums increased by $410, or 9%, primarily due to:
−Removed: • An increase in P&C reflecting an 11% increase in Commercial Lines and 3% in Personal Lines.
−Removed: – Contributing to the increase in Commercial Lines was the effect of earned pricing increases, an increase in small commercial and middle and large commercial new business, and the effect of higher insured exposures, principally in workers’ compensation, partially offset by lower new business in global specialty.
+Added: • An increase in P&C reflecting a 10% increase in Commercial Lines and a 5% increase in Personal Lines.
+Added: – Contributing to the increase in Commercial Lines was an increase in new business across all lines of business, the effect of earned pricing increases, and the effect of higher insured exposures, principally in workers’ compensation as well as property lines.
– For Personal Lines, earned premium was up due to the effect of earned pricing increases, partially offset by non-renewals.
−Removed: • An increase in Group Benefits earned premium of 8% due to increases in group life, group disability, and supplemental health product premiums, primarily driven by strong new business sales and persistency as well as an increase in exposure on existing accounts.
−Removed: Fee income decreased, driven by lower daily average assets within Hartford Funds due to a decline in equity and fixed income market levels since the prior year period and, to a lesser extent, net outflows over the preceding twelve months.
+Added: • An increase in Group Benefits earned premium of 7% due to increases in group life, group disability, and supplemental health product premiums, primarily driven by strong persistency and new business sales as well as an increase in exposure on existing accounts.
+Added: Fee income decreased, driven by lower daily average assets within Hartford Funds due to net outflows over the preceding twelve months, partially offset by an increase in equity market levels since the prior year period.
Net Investment Income
−Removed: Net investment income increased primarily due to the impact of a higher yield on variable-rate securities and reinvesting at higher rates, partially offset by lower income from limited partnerships and other alternative investments driven by lower returns on private equity funds and lower real estate fund valuations, in addition to income from sales of underlying real estate properties in the 2022 period.
−Removed: Net realized losses decreased primarily due to gains on equity securities in the 2023 period due to repositioning and appreciation in value compared to losses on equity securities in the 2022 period driven by depreciation in value.
+Added: Net investment income remained relatively flat primarily due to lower income from limited partnerships and other alternative investments, offset by the impact of a higher yield on variable-rate securities and reinvesting at higher rates.
+Added: The lower limited partnership and other alternative investment income was driven by income from sales of underlying real estate properties in the 2022 period and lower real estate fund valuations in the current year as compared to the prior year.
+Added: Net realized losses decreased primarily due to a decline in value of equity securities in the 2022 period driven by lower equity market levels.
+Added: Also included were fewer net losses on sales of fixed maturities in the 2023 period compared to the 2022 period, largely offset by losses on credit derivatives in the 2023 period due to credit spread tightening.
For further discussion of investment results, see MD&A - Investment Results, Net Realized Gains and MD&A - Investment Results, Net Investment Income.
6 unchanged sentences
• An increase in Property & Casualty of $394, which was attributable to:
−Removed: – An increase in P&C current accident year ("CAY") loss and loss adjustment expenses before catastrophes of $252, before tax, primarily due to the effect of higher earned premiums in Commercial Lines, higher personal automobile claim severity, and a higher loss ratio in small commercial, partially offset by lower loss ratios in global specialty and middle and large commercial.
+Added: – An increase in P&C current accident year ("CAY") loss and loss adjustment expenses before catastrophes of $272, before tax, primarily due to the effect of higher earned premiums in Commercial Lines and higher personal automobile claim severity.
– An increase in current accident year catastrophe losses of $103, before tax.
−Removed: Catastrophe losses in the 2023 period included losses from winter storms along the East and West Coasts and tornado, wind and hail events across several regions of the United States.
−Removed: Catastrophe losses in the 2022 period included $27, net of reinsurance, related to the Ukraine conflict, as well as losses from tornado, wind and hail events in the Southeast and winter storms along the East Coast.
−Removed: – A decline in P&C net favorable prior accident year reserve development of $36, before tax, with no net development in the 2023 period.
−Removed: For the 2023 period, prior year reserve development primarily included a decrease in reserves related to workers’ compensation and package business, offset by increases in reserves for Personal Lines automobile physical damage, general liability, and uncollectible reinsurance.
−Removed: Prior accident year reserve development in the 2022 period was a net favorable $36, before tax, primarily driven by reserve decreases in workers' compensation, package business, and commercial property, partially offset by reserve increases in general liability and assumed reinsurance.
+Added: Catastrophe losses in the 2023 period included losses from tornado, wind and hail events across several regions of the United States, mainly in the South, Midwest and Mountain West.
+Added: Catastrophe losses in the 2022 period included losses from wind and hail events mostly concentrated in the South, Midwest, and Central Plains.
+Added: – A decline in P&C net favorable prior accident year reserve development of $19, before tax.
+Added: Prior accident year reserve development in the 2023 period was a net favorable $39, before tax, primarily driven by decreases in reserves related to catastrophes and workers’ compensation, partly offset by increases in reserves for general liability, assumed reinsurance, and bond.
+Added: Prior accident year reserve development in the 2022 period was a net favorable $58, before tax, primarily driven by reserve decreases in workers' compensation, catastrophes and package business, partially offset by reserve increases in general liability and commercial automobile liability.
For further discussion, see Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
Losses and LAE Incurred for Group Benefits
−Removed: – Partially offsetting the P&C increase was a decline in Group Benefits of $13, before tax, primarily driven by the impact of lower mortality claims and a lower incidence in group disability, partially offset by the effect of an increase in earned premiums.
+Added: – An increase in Group Benefits of $112, before tax, primarily driven by the effect of an increase in earned premiums, as well as the impact of a higher group life loss ratio and a slightly higher group disability loss ratio.
+Added: The higher group life loss ratio was driven primarily by favorable prior quarter reserve development benefiting the 2022 period, as well as higher group life severity in the 2023 period.
+Added: The slight increase in the group disability loss ratio was driven by higher paid family leave and short-term disability claim incidence as compared to the prior year period, partially offset by favorable long-term disability claim incidence and recoveries.
Amortization of deferred policy acquisition costs increased from the prior year period driven by Commercial Lines, reflecting an increase in earned premiums across all commercial lines of business.
−Removed: Insurance operating costs and other expenses increased slightly due to:
+Added: Insurance operating costs and other expenses were flat due to increases related to:
• Technology investments made to improve customer and broker experience and data analytics to enhance underwriting and pricing capabilities;
−Removed: • Higher commissions in Group Benefits;
−Removed: • Higher staffing costs in Commercial Lines and Group Benefits partly in response to higher business volume.
+Added: • Increased expense from higher staffing costs and commissions in Commercial Lines and Group Benefits, partly in response to increased business volume, mostly offset by lower incentive compensation.
These increases were offset by:
2 unchanged sentences
• Lower direct marketing costs in Personal Lines;
−Removed: Interest expense decreased primarily due to the Company redeeming $600 aggregate principal amount of junior subordinated debentures on April 15, 2022.
+Added: • A loss on extinguishment of debt in the 2022 period.
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
Income tax expense increased primarily due to an increase in income before tax.
For further discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
+Added: Six months ended June 30, 2023 compared to the six months ended June 30, 2022
+Added: Net income available to common stockholders increased by $195 primarily driven by:
+Added: • Lower net realized losses of $412, before tax, driven by a decline in value of equity securities in the 2022 period;
+Added: • In Group Benefits, an improved group life loss ratio driven by a lower level of mortality, the effect of higher fully insured ongoing premiums, including a lower expense ratio, and an improved group disability loss ratio, partially offset by lower net investment income;
+Added: • A lower level of interest expense on corporate debt in the 2023 period compared to the 2022 period and a loss on extinguishment of debt in the 2022 period.
+Added: These increases were partially offset by:
+Added: • A decrease in P&C underwriting gain of $308, before tax, driven by higher current accident year catastrophe losses, a higher current accident year loss and LAE ratio before catastrophes in Personal Lines, and a lower level of favorable prior accident year reserve development, partially offset by the effect of earned premium growth, including a lower expense ratio;
+Added: • In Hartford Funds, lower fee income net of variable expenses.
+Added: For a discussion of the Company's operating results by segment, see MD&A - Segment Operating Summaries.
+Added: Earned Premiums
+Added: Earned premiums increased by $822, or 9%, primarily due to:
+Added: • An increase in P&C reflecting an 11% increase in Commercial Lines and a 4% increase in Personal Lines.
+Added: – Contributing to the increase in Commercial Lines was the effect of an increase in new business across lines of business, earned pricing increases, and higher insured exposures, principally in workers’ compensation.
+Added: Net Investment Income
+Added: – For Personal Lines, earned premium was up due to the effect of earned pricing increases, partially offset by non-renewals.
+Added: • An increase in Group Benefits earned premium of 7% due to increases in group life, group disability, and supplemental health product premiums, primarily driven by strong persistency and new business sales as well as an increase in exposure on existing accounts.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: Fee income decreased, driven by lower daily average assets within Hartford Funds due to net outflows over the preceding twelve months partly offset by an increase in equity market levels since the prior year period.
+Added: Net investment income increased slightly primarily due to the impact of a higher yield on variable-rate securities and reinvesting at higher rates.
+Added: This increase was largely offset by lower limited partnership and other alternative investment income driven by income from sales of underlying real estate properties in the 2022 period, lower real estate fund valuations in the current year as compared to the prior year, and an increase in private equity fund valuations in the 2022 period.
+Added: Net realized losses decreased primarily due to a decline in value of equity securities in the 2022 period driven by lower equity market levels.
+Added: Also included were fewer net losses on sales of fixed maturities in the 2023 period compared to the 2022 period, partially offset by losses on credit derivatives in the 2023 period due to credit spread tightening.
+Added: For further discussion of investment results, see MD&A - Investment Results, Net Realized Gains and MD&A - Investment Results, Net Investment Income.
+Added: BENEFITS, LOSSES AND EXPENSES
+Added: Losses and LAE Incurred for P&C
+Added: Benefits, losses and loss adjustment expenses increased $868, comprised of:
+Added: • An increase in Property & Casualty of $769, which was attributable to:
+Added: – An increase in P&C CAY loss and loss adjustment expenses before catastrophes of $524, before tax, primarily due to the effect of higher earned premiums in Commercial Lines and higher personal automobile claim severity.
+Added: – An increase in current accident year catastrophe losses of $190, before tax.
+Added: Catastrophe losses in the 2023 period included losses from tornado, wind and hail events across several regions of the United States, and losses from winter storms along the East and West Coasts.
+Added: Catastrophe losses in the 2022 period included losses from tornado, wind and hail events in the South, Midwest and Central Plains, winter storms along the East Coast, and $27 of losses, net of reinsurance, related to the Ukraine conflict.
+Added: Losses and LAE Incurred for Group Benefits
+Added: – A decline in P&C net favorable prior accident year reserve development of $55, before tax.
+Added: Prior accident year reserve development in the 2023 period was a net favorable $39, before tax, primarily driven by decreases in reserves related to workers' compensation and catastrophes, offset by increases in reserves for general liability, Personal Lines automobile physical damage, assumed reinsurance, bond, and uncollectible reinsurance.
+Added: Prior accident year reserve development in the 2022 period was a net favorable $94, before tax, primarily driven by reserve decreases in workers' compensation, catastrophes, package business, and commercial property, partially offset by reserve increases in general liability, assumed reinsurance, and commercial automobile liability.
+Added: For further discussion, see Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
+Added: • An increase in Group Benefits of $99, before tax, primarily driven by the effect of an increase in earned premiums and higher incidence on paid family leave products, partially offset by the impact of lower mortality levels and lower incidence and favorable recoveries in long-term disability.
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: Amortization of deferred policy acquisition costs increased from the prior year period driven by Commercial Lines, reflecting an increase in earned premiums across all commercial lines of business.
+Added: Insurance operating costs and other expenses increased slightly due to:
+Added: • Technology investments made to improve customer and broker experience and data analytics to enhance underwriting and pricing capabilities;
+Added: • Increased expense from higher staffing costs and commissions in Commercial Lines and Group Benefits partly in response to increased business volume, mostly offset by lower incentive compensation.
+Added: These increases were offset by:
+Added: • Lower variable expenses in Hartford Funds;
+Added: • Incremental savings from the Company’s Hartford Next operational transformation and cost reduction plan;
+Added: • Lower direct marketing costs in Personal Lines;
+Added: • Loss on extinguishment of debt in the 2022 period.
+Added: Interest Expense decreased primarily due to the Company redeeming $600 aggregate principal amount of junior subordinated debentures on April 15, 2022.
+Added: Income tax expense increased primarily due to an increase in income before tax.
+Added: For further discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
INVESTMENT RESULTS
Composition of Invested Assets
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Amount Percent Amount Percent
9 unchanged sentences
[1] Primarily consists of equity fund investments, overseas deposits, consolidated investment funds, and derivative instruments which are carried at fair value.
−Removed: March 31, 2023 compared to December 31, 2022
−Removed: Total investments increased primarily due to an increase in fixed maturities, AFS, at fair value partially offset by a decrease in equity securities, at fair value.
−Removed: Fixed maturities, AFS, at fair value increased primarily due to an increase in valuations as a result of a decline in interest rates, partially offset by wider credit spreads.
−Removed: The increase was also due to net additions primarily within the corporate sector.
−Removed: Equity securities, at fair value decreased primarily due to sales.
+Added: June 30, 2023 compared to December 31, 2022
+Added: Total investments increased slightly primarily due to an increase in fixed maturities, AFS, at fair value and limited partnerships and other alternative investments, partially offset by a decrease in equity securities, at fair value and short-term investments.
+Added: Fixed maturities, AFS, at fair value increased primarily due to net additions of asset backed securities ("ABS") and corporate bonds and an increase in valuations as a result of tighter credit spreads.
+Added: Limited partnerships and other alternative investments increased primarily driven by additional investments.
+Added: Equity securities, at fair value decreased primarily due to sales of common stocks.
+Added: The remaining equity securities, at fair value is comprised of approximately 50% of preferred stock.
+Added: Short-term investments decreased primarily due to the Boy Scouts of America settlement paid on April 20, 2023.
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
Net Investment Income
−Removed: Three Months Ended March 31,
−Removed: (Before tax) Amount Yield [1] Amount Yield [1]
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 2023 2022
+Added: (Before tax) Amount Yield [1] Amount Yield [1] Amount Yield [1] Amount Yield [1]
Fixed maturities [2] $ 460 4.2 % $ 346 3.2 % $ 905 4.1 % $ 677 3.2 %
9 unchanged sentences
[3] Primarily includes changes in fair value of certain equity fund investments and income from derivatives that qualify for hedge accounting and are used to hedge fixed maturities.
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Total net investment income increased slightly due to:
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Total net investment income largely flat due to:
• Higher yield on variable-rate securities and the impact of reinvesting at higher rates;
−Removed: • Partially offset by lower income from limited partnerships and other alternative investments driven by lower returns on private equity funds and lower real estate fund valuations, in addition to income from sales of underlying real estate properties in the 2022 period.
−Removed: Annualized net investment income yield, excluding limited partnerships and other alternative investments, was up
+Added: • Largely offset by lower income from limited partnerships and other alternative investments driven by income from sales of underlying real estate properties in the 2022 period and lower real estate fund valuations.
+Added: In addition, the six month period of 2022 included valuation increases on private equity funds.
+Added: Annualized net investment income yield, excluding limited partnerships and other alternative investments, was up primarily due to a higher yield on variable-rate securities and higher reinvestment rates.
+Added: Average reinvestment rates, on fixed maturities and mortgage loans, excluding certain U.S.
+Added: Treasury securities, for the three and six months ended June 30, 2023 were 5.3% and 5.6%, respectively, which were above the average yield of sales and maturities of 4.1% and 4.1%, respectively.
+Added: Average reinvestment rates for the three and six months ended June 30, 2022, were 4.5% and 3.8%, respectively, which were above the average yield of sales and maturities of 3.6% and 3.3%, respectively.
+Added: For the 2023 calendar year, we expect the annualized net investment income yield, excluding limited partnerships and other alternative investments, to be above the portfolio yield earned in 2022 due to the higher rate environment.
+Added: The estimated impact on annualized net investment income yield is subject to variability due to evolving market conditions, active portfolio management, and the level of non-routine income items, such as make-whole payments, prepayment penalties on mortgage loans and yield adjustments on prepayable securities.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: primarily due to a higher yield on variable-rate securities and higher reinvestment rates.
−Removed: Average reinvestment rate, on fixed maturities and mortgage loans, excluding certain U.S.
−Removed: Treasury securities, for the three months ended March 31, 2023 was 5.8% which was above the average yield of sales and maturities of 4.2% for the same period.
−Removed: Average reinvestment rate on fixed maturities and mortgage loans, excluding certain U.S.
−Removed: Treasury securities, for the three months ended March 31, 2022, was 3.3%, which was above the average yield of sales and maturities of 3.0%.
−Removed: For the 2023 calendar year, we expect the annualized net investment income yield, excluding limited partnerships and
−Removed: other alternative investments, to be above the portfolio yield earned in 2022 due to the expected higher rate environment.
−Removed: The estimated impact on annualized net investment income yield is subject to variability due to evolving market conditions, active portfolio management, and the level of non-routine income items, such as make-whole payments, prepayment penalties on mortgage loans and yield adjustments on prepayable securities.
Net Realized Gains (Losses)
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
(Before tax) 2023 2022 2023 2022
7 unchanged sentences
Net realized losses $ (64) $ (338) $ (71) $ (483)
−Removed: [1] The change in net unrealized gains (losses) on equity securities still held as of the end of the period and included in net realized gains (losses) were $2 and $(131) for the three months ended March 31, 2023, and 2022, respectively.
+Added: [1] The change in net unrealized gains (losses) on equity securities still held as of June 30, 2023 and included in net realized gains (losses) were $7 and $7 for the three and six months ended June 30, 2023, respectively.
+Added: The change in net unrealized gains (losses) on equity securities still held as of June 30, 2022 and included in net realized gains (losses) were $(259) and $(366) for the three and six months ended June 30, 2022, respectively.
[2] See Credit Losses on Fixed Maturities, AFS and Intent-to-Sell Impairments within the Investment Portfolio Risks and Risk Management section of the MD&A.
[3] See ACL on Mortgage Loans within the Investment Portfolio Risks and Risk Management section of the MD&A.
−Removed: [4] For the three months ended March 31, 2023, and 2022 includes gains (losses) from transactional foreign currency revaluation of $(7) and $6, respectively, and gains (losses) on non-qualifying derivatives of $5 and $47, respectively.
−Removed: Three months ended March 31, 2023
+Added: [4] For the three and six months ended June 30, 2023, includes gains (losses) from transactional foreign currency revaluation of $(9) and $(16), respectively, and gains (losses) on non-qualifying derivatives of $(39) and $(34), respectively.
+Added: For the three and six months ended June 30, 2022, includes gains (losses) from transactional foreign currency revaluation of $15 and $21, respectively, and gains (losses) on non-qualifying derivatives of $14 and $61, respectively.
+Added: Three and six months ended June 30, 2023
Gross gains and losses on sales were primarily due to sales of corporate securities and tax-exempt municipals, in addition to sales of U.S.
treasuries for duration and/or liquidity management.
−Removed: Equity securities net gains were primarily driven by repositioning and appreciation in value due to higher equity market levels.
−Removed: Other, net losses were primarily due to $16 on credit derivatives and $8 on FVO securities due to changes in credit spreads, as well as, $7 on transactional foreign currency revaluation.
−Removed: These losses were partially offset by gains of $21 on interest rate derivatives driven by changes in interest rates.
−Removed: Three months ended March 31, 2022
−Removed: Gross gains and losses on sales were primarily due to tender activity and sales of corporate securities and tax-exempt municipals, in addition to sales of U.S.
−Removed: treasuries for duration and risk management.
−Removed: Equity securities net losses were primarily driven by mark-to-market losses due to the decline in equity market levels.
−Removed: Other, net gains were primarily due to $32 on interest rate derivatives driven by an increase in interest rates and $14 on the termination of commodity derivatives driven by an increase in the price of crude oil.
−Removed: Index to MD&A
−Removed: Part I - Item 2.
−Removed: Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: Equity securities net gains were primarily driven by an increase in value due to higher equity market levels.
+Added: Other, net losses for the three and six month periods ended June 30, 2023 primarily included losses of $36 and $52, respectively, on credit derivatives primarily due to changes in valuation, and, losses of $9 and $16, respectively, on transactional foreign currency revaluation.
+Added: Also included for the six month period ended June 30, 2023 were losses of $11 on FVO securities due to changes in credit spreads and gains of $18 on interest rate derivatives driven by an increase in interest rates.
+Added: Three and six months ended June 30, 2022
+Added: Gross gains and losses on sales were primarily due to sales of U.S.
+Added: treasuries for duration management and to fund purchases of spread product, mortgage loans, and alternative investments.
+Added: Also included were sales of corporate securities and tax-exempt municipals and tender activity.
+Added: Equity securities net losses were primarily driven by a decline in value due to lower equity market levels.
+Added: Other, net gains and losses for the three and six month periods ended June 30, 2022 included gains of $15 and $21, respectively, on transactional foreign currency revaluation, and, losses of $20 and $23, respectively, on FVO securities due to credit spread widening.
+Added: Also included for the six month period ended June 30, 2022 were gains of $37 on interest rate derivatives driven by an increase in interest rates and $14 on the termination of commodity derivatives driven by an increase in the price of crude oil.
CRITICAL ACCOUNTING ESTIMATES
11 unchanged sentences
Certain of these estimates are particularly sensitive to market conditions, and deterioration and/or volatility in the worldwide debt or equity markets could have a material impact on the Condensed Consolidated Financial Statements.
−Removed: The Company’s critical accounting estimates are discussed in Part II, Item 7 MD&A in the Company’s 2022 Form 10-K Annual Report.
−Removed: In addition, Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements included in the Company's 2022 Form 10-K Annual Report should be read in conjunction with this section to assist with obtaining an understanding of the underlying accounting policies related to these estimates.
−Removed: The following discussion updates certain of the Company’s critical accounting estimates as of March 31, 2023.
+Added: The Company’s critical accounting estimates are discussed in Part II, Item 7 MD&A in the Company’s 2022 Form 10-K Annual
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: In addition, Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements included in the Company's 2022 Form 10-K Annual Report should be read in conjunction with this section
+Added: to assist with obtaining an understanding of the underlying accounting policies related to these estimates.
+Added: The following discussion updates certain of the Company’s critical accounting estimates as of June 30, 2023.
| PROPERTY & CASUALTY INSURANCE PRODUCT RESERVES, NET OF REINSURANCE
−Removed: P&C Loss and Loss Adjustment Expense Reserves, Net of Reinsurance, by Segment as of March 31, 2023
+Added: P&C Loss and Loss Adjustment Expense Reserves, Net of Reinsurance, by Segment as of June 30, 2023
Based on the results of the quarterly reserve review process, the Company determines the appropriate reserve adjustments, if any, to record.
10 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Three Months Ended March 31, 2023
+Added: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Six Months Ended June 30, 2023
Commercial Lines Personal
10 unchanged sentences
Prior accident year development (" PYD ")
+Added: (61) 17 5 (39)
Total provision for unpaid losses and loss adjustment expenses
14 unchanged sentences
Current Accident Year Catastrophe Losses, Net of Reinsurance
−Removed: Three Months Ended March 31, 2023
+Added: Three Months Ended June 30, 2023 Six Months Ended June 30, 2023
Lines Personal
+Added: Lines Total [1] Commercial
+Added: Lines Personal
Wind and hail $ 110 $ 102 $ 212 $ 153 $ 135 $ 288
9 unchanged sentences
Unfavorable (Favorable) Prior Accident Year Development for the
−Removed: Three Months Ended March 31, 2023
+Added: Three Months Ended June 30, 2023
Commercial Lines Personal
7 unchanged sentences
Professional liability (3) — — (3)
+Added: Bond 12 — — 12
Assumed reinsurance 15 — — 15
1 unchanged sentence
Homeowners — 2 — 2
−Removed: Net asbestos and environmental reserves — — — —
+Added: Net asbestos and environmental ("A&E") reserves
Catastrophes (40) (4) — (44)
2 unchanged sentences
Total prior accident year development
−Removed: [1] Other reserve re-estimates for the three months ended March 31, 2023 includes a $20 increase in personal automobile physical damage reserves.
−Removed: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Three Months Ended March 31, 2022
+Added: $ (38) $ (3) $ 2 $ (39)
+Added: Unfavorable (Favorable) Prior Accident Year Development for the
+Added: Six Months Ended June 30, 2023
+Added: Commercial Lines Personal
+Added: Lines Property & Casualty Other Operations Total Property & Casualty Insurance
+Added: Workers’ compensation $ (113) $ — $ — $ (113)
+Added: Workers’ compensation discount accretion 22 — — 22
+Added: General liability 28 — — 28
+Added: Marine (1) — — (1)
+Added: Package business (8) — — (8)
+Added: Commercial property — — — —
+Added: Professional liability (3) — — (3)
+Added: Bond 12 — — 12
+Added: Assumed reinsurance 17 — — 17
+Added: Automobile liability 6 — — 6
+Added: Homeowners — 1 — 1
+Added: Net A&E reserves — — — —
+Added: Catastrophes (40) (4) — (44)
+Added: Uncollectible reinsurance 9 — 3 12
+Added: Other reserve re-estimates, net [1] 10 20 2 32
+Added: Total prior accident year development $ (61) $ 17 $ 5 $ (39)
+Added: [1] Other reserve re-estimates for the six months ended June 30, 2023 includes a $22 increase in personal automobile physical damage reserves.
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Six Months Ended June 30, 2022
Lines Personal
19 unchanged sentences
[2] “Prior accident year development (pts)” represents the ratio of prior accident year development to earned premiums.
−Removed: Index to MD&A
−Removed: Part I - Item 2.
−Removed: Management's Discussion and Analysis of Financial Condition and Results of Operations
Current Accident Year Catastrophe Losses, Net of Reinsurance
−Removed: Three Months Ended March 31, 2022
+Added: Three Months Ended June 30, 2022 Six Months Ended June 30, 2022
+Added: Lines Total Commercial
Wind and hail $ 54 $ 53 $ 107 $ 71 $ 65 $ 136
Winter storms (4) — (4) 19 5 24
+Added: Wildfires — 3 3 — 3 3
Ukraine conflict [1] — — — 23 — 23
+Added: Tropical Storms 2 — 2 2 — 2
Catastrophes before assumed reinsurance 52 56 108 115 73 188
1 unchanged sentence
Total catastrophe losses $ 67 $ 56 $ 123 $ 148 $ 73 $ 221
−Removed: [1] Total catastrophe losses resulting from the Ukraine conflict were $27, net of reinsurance, for the three months ended March 31, 2022, including $4 within global assumed reinsurance.
+Added: [1] Total catastrophe losses resulting from the Ukraine conflict were $27, net of reinsurance, including $4 within global assumed reinsurance for the six months ended June 30, 2022, all in the first quarter.
[2] Catastrophe losses incurred on global assumed reinsurance business are not covered under the Company's aggregate property catastrophe treaty.
For further information on the treaty, refer to Enterprise Risk Management — Insurance Risk section of this MD&A.
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
Unfavorable (Favorable) Prior Accident Year Development for the
−Removed: Three Months Ended March 31, 2022
+Added: Three Months Ended June 30, 2022
Commercial Lines Personal
7 unchanged sentences
Professional liability (9) — — (9)
+Added: Bond (4) — — (4)
Assumed Reinsurance — — — —
1 unchanged sentence
Homeowners — — — —
−Removed: Net asbestos and environmental reserves — — — —
+Added: Net A&E reserves — — — —
Catastrophes (26) (1) — (27)
2 unchanged sentences
Total prior accident year development
+Added: $ (88) $ — $ 30 $ (58)
+Added: Unfavorable (Favorable) Prior Accident Year Development for the
+Added: Six Months Ended June 30, 2022
+Added: Commercial Lines Personal
+Added: Property & Casualty Other Operations Total Property & Casualty Insurance
+Added: Workers’ compensation $ (85) $ — $ — $ (85)
+Added: Workers’ compensation discount accretion 18 — — 18
+Added: General liability 2 — 31 33
+Added: Marine (3) — — (3)
+Added: Package business (24) — — (24)
+Added: Commercial property (21) — — (21)
+Added: Professional liability (9) — — (9)
+Added: Bond (4) — — (4)
+Added: Assumed reinsurance 12 — — 12
+Added: Automobile liability 12 (5) — 7
+Added: Homeowners — — — —
+Added: Net A&E reserves — — — —
+Added: Catastrophes (29) (1) — (30)
+Added: Uncollectible reinsurance — — 6 6
+Added: Other reserve re-estimates, net 10 3 (7) 6
+Added: Total prior accident year development $ (121) $ (3) $ 30 $ (94)
For discussion of the factors contributing to unfavorable (favorable) prior accident year reserve development for both the 2023 and 2022 periods, please refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
5 unchanged sentences
Underwriting Summary
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Written premiums $ 3,177 $ 2,836 12 % $ 6,286 $ 5,645 11 %
25 unchanged sentences
Premium Measures
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 2023 2022
Small Commercial:
17 unchanged sentences
Underwriting Ratios
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Loss and loss adjustment expense ratio
11 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Net income for the three months ended March 31, 2023 increased primarily due to lower net realized losses, partially offset by a lower underwriting gain.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Net income for the three and six months ended June 30, 2023 increased primarily due to lower net realized losses, partially offset by a lower underwriting gain.
For further discussion of investment results, see MD&A - Investment Results.
Underwriting Gain
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Underwriting gain for the three month period ended March 31, 2023 decreased driven by higher current accident year catastrophes, higher underwriting expenses, a higher current accident year loss and LAE ratio before catastrophes and lower favorable prior accident year development, partially offset by the effect of earned premium growth.
−Removed: Underwriting expenses increased in the three month period due to higher technology and staffing costs, partially offset by incremental savings from Hartford Next initiatives.
−Removed: Expense ratio decreased driven by the impact of higher earned premium and incremental savings from the Hartford Next program, partially offset by investments in technology and higher staffing costs.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Underwriting gain for the three and six months ended June 30, 2023 decreased driven by higher current accident year catastrophes, lower favorable prior accident year development, and a higher current accident year loss and LAE ratio before catastrophes, partially offset by the effect of earned premium growth, including a lower expense ratio.
+Added: Expense ratio decreased in both periods driven by the impact of higher earned premium, lower incentive compensation and incremental savings from the Hartford Next program, partially offset by investments in technology and higher underwriter staffing costs.
Index to MD&A
2 unchanged sentences
Earned Premiums
−Removed: [1]Other earned premiums of $11 and $13, for the three months ended March 31, 2022, and 2023, respectively.
+Added: [1]Other earned premiums of $13 and $13, for the three months ended June 30, 2022, and 2023, respectively, and $24 and $26 for the six months ended June 30, 2022 and 2023, respectively is included in the total.
Written Premiums
−Removed: [1] Other written premiums of $12 and $13 for the three months ended March 31, 2022, and 2023, respectively, is included in the total.
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Earned premiums for the three month period increased due to written premium increases over the prior 12 months, including the effect of higher insured exposures, principally in workers’ compensation from higher payrolls.
−Removed: Written premiums f or the three month period increased driven by growth across small commercial, middle & large commercial and global specialty.
−Removed: • Small commercial written premium increased driven by double-digit new business growth, renewal written price increases in all lines and higher insured exposures.
+Added: [1] Other written premiums of $12 and $13 for the three months ended June 30, 2022, and 2023, respectively, and $24 and $26 for the six months ended June 30, 2022 and 2023 is included in the total.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Earned premiums for the three and six month periods increased due to written premium increases over the prior 12 months, including the effect of higher insured exposures.
+Added: Written premiums f or the three and six month periods increased driven by double-digit growth across small commercial, middle & large commercial and global specialty.
+Added: • Small commercial written premium increased in both periods driven by double-digit new business growth, renewal written price increases in all lines and higher insured exposures.
Written premium grew in all lines of business, with the most significant growth in package business, workers' compensation and excess and surplus lines.
−Removed: • Middle & large commercial written premium increased driven by double-digit new business growth, renewal written price increases in all lines, and higher insured exposures.
+Added: • Middle & large commercial written premium increased in both periods driven by double-digit new business growth, renewal written price increases in all lines, and higher insured exposures.
Written premium grew in nearly all lines across general industries, industry verticals and specialty markets.
−Removed: • Global specialty written premium increased driven by written price increases across almost all lines, partially offset by a decline in gross new business.
−Removed: Written premium growth was most significant in global reinsurance.
−Removed: Renewal written price increases were recognized in nearly all lines in the three month period, with moderating price increases across most lines in global specialty.
−Removed: • In small commercial excluding workers' compensation, renewal written price increases were higher in 2023, with high-single digit price increases in package business and automobile.
+Added: • Global specialty written premium increased in both periods driven by written price increases across almost all lines as well as an increase in gross new business.
+Added: Written premiums grew across most U.S.
+Added: and international lines, with the most significant growth in global reinsurance.
+Added: Renewal written price increases were recognized in nearly all lines in both the three and six month periods, with accelerating price increases across most lines other than workers' compensation and director's and officer's.
+Added: • In small commercial excluding workers' compensation, renewal written price increases were higher in 2023, with high-single digit price increases in package business and automobile and double-digit increases in excess and surplus lines.
Workers' compensation pricing moderated from 2022 but was slightly positive due to the effect of wage inflation largely offset by lower net rates.
−Removed: • In middle market, the Company recognized high single-digit price increases in most lines other than workers’ compensation, which experienced low single-digit written price increases as the effect of higher wages more than offset lower rates.
−Removed: • In global specialty, price increases continue to moderate and we achieved low single-digit renewal written price increases overall, with the highest increases in property, marine and casualty lines.
+Added: • In middle market, the Company recognized high single-digit to low double-digit price increases in most lines other than workers’ compensation, which was slightly positive due to the effect of wage inflation largely offset by lower net rates.
+Added: • In global specialty, price increases continued to moderate from prior year levels and we achieved low single-digit renewal written price increases overall, with the highest increases in property, marine and casualty lines.
Index to MD&A
2 unchanged sentences
Current Accident Year Loss and LAE Ratio before Catastrophes
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Current accident year loss and LAE ratio before catastrophes increased in the three month period due to higher loss ratios in workers' compensation, and to a lesser extent, automobile and global reinsurance lines, partially offset by a lower loss ratio in global specialty international lines.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Current accident year loss and LAE ratio before catastrophes increased in the three month period due to a higher loss ratio in workers' compensation, and to a lesser extent, slightly elevated losses in a run-off line within the international book.
+Added: Current accident year loss and LAE ratio before catastrophes increased in the six month period principally driven by a higher loss ratio in workers' compensation, partially offset by a lower loss ratio in international.
The lower loss ratio in global specialty international was mostly driven by the effect on the prior year ratio of $11 before tax in reinstatement premium owed to reinsurers related to ceding Ukraine conflict losses and a large ocean marine loss from an oil spill off the coast of Peru, both of which occurred in the three months ended March 31, 2022.
Catastrophes and Unfavorable (Favorable) Prior Accident Year Development
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Current accident year catastrophe losses for the three months ended March 31, 2023 included losses from winter storms primarily on the East and West Coasts as well as losses from various tornado, wind and hail events in several regions of the United States.
−Removed: Current accident year catastrophe losses for the three months ended March 31, 2022 included losses from tornado, wind and hail events in the Southeast, winter storms along the East Coast and $27 of losses, net of reinsurance, related to the Ukraine conflict.
−Removed: Prior accident year development was net favorable for the three months ended March 31, 2023 and included reserve decreases for workers' compensation and package business, partially offset by reserve increases for general liability, property and uncollectible reinsurance.
−Removed: Prior accident year development was net favorable for 2022.
−Removed: Reserve development in the three months ended March 31, 2022 included reserve decreases for workers' compensation, commercial property and package business, partially offset by reserve increases for general liability and assumed reinsurance.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Current accident year catastrophe losses for the three and six months ended June 30, 2023 included losses from tornado, wind and hail events across several regions of the United States and, for the six month period, winter storms primarily on the East and West coasts.
+Added: Current accident year catastrophe losses for the three and six months ended June 30, 2022 included losses from tornado, wind and hail events primarily in the South, Midwest and Central Plains, and, for the six month period, winter storms along the East coast and $27 of losses, net of reinsurance, related to the Ukraine conflict.
+Added: Prior accident year development was net favorable for the three and six months ended June 30, 2023 and included reserve decreases for workers' compensation and catastrophes, partially offset by reserve increases for general liability, assumed reinsurance and bond.
+Added: Prior accident year development was net favorable for the three and six months ended June 30, 2022.
+Added: Reserve development in the 2022 periods included reserve decreases for workers' compensation, catastrophes, package business and commercial property, partially offset by reserve increases for automobile liability and, for the six month period, assumed reinsurance.
+Added: In the three and six month periods, an increase in reserves for general liability related to excess casualty and primary construction was largely offset by a reallocation of a portion of reserves for sexual molestation and sexual abuse claims from Commercial Lines to P&C Other Operations.
+Added: The reallocated reserves relate to excess liability policies written by a legal entity in P&C Other Operations for amounts owed to claimants under the agreement in principle reached with the Boy Scouts of America ("BSA") on sexual molestation and sexual abuse claims in third quarter 2021.
+Added: In total for the Company, there was no change in the liability for settlement amounts owed on BSA claims.
+Added: The six months ended June 30, 2022 also included reserve decreases for professional liability.
Index to MD&A
3 unchanged sentences
Underwriting Summary
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Written premiums $ 802 $ 756 6 % $ 1,549 $ 1,463 6 %
5 unchanged sentences
Current accident year catastrophes [1] 103 56 84 % 150 73 105 %
−Removed: Prior accident year development [1] 20 (3) NM
+Added: Prior accident year development [1] (3) — NM 17 (3) NM
Total losses and loss adjustment expenses 678 533 27 % 1,266 985 29 %
2 unchanged sentences
Amortization of other intangible assets — — — % 1 1 — %
−Removed: Underwriting gain (loss) (45) 69 (165 %)
+Added: Underwriting gain (loss) (113) (13) NM (158) 56 NM
Net investment income [2] 34 35 (3 %) 72 68 6 %
1 unchanged sentence
Net servicing and other income (expense) [3] 7 3 133 % 13 7 86 %
−Removed: Income (loss) before income taxes (2) 97 (102 %)
−Removed: Income tax expense (benefit) [4] (1) 20 (105 %)
−Removed: Net income (loss) $ (1) $ 77 (101) %
+Added: Income (loss) before income taxes (77) 7 NM (79) 104 (176 %)
+Added: Income tax expense (benefit) [4] (17) 1 NM (18) 21 (186 %)
+Added: Net income (loss) $ (60) $ 6 NM $ (61) $ 83 (173) %
[1] For additional information on current accident year catastrophes and prior accident year development, see MD&A - Critical Accounting Estimates, Property & Casualty Insurance Product Reserves, Net of Reinsurance and Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
[2] For discussion of consolidated investment results, see MD&A - Investment Results.
−Removed: [3] Includes servicing revenues of $19 and $17 for the three months ended March 31, 2023 and 2022, respectively.
−Removed: Includes servicing expenses of $14 and $13 for the three months ended March 31, 2023 and 2022, respectively.
+Added: [3] Includes servicing revenues of $24 and $19 for the three months ended June 30, 2023 and 2022, respectively, and $43 and $36 for the six months ended June 30, 2023 and 2022, respectively.
+Added: Includes servicing expenses of $16 and $15 for the three months ended June 30, 2023 and 2022, respectively, and $30 and $28 for the six months ended June 30, 2023 and 2022, respectively.
[4] For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
Written and Earned Premiums
−Removed: Three Months Ended March 31,
−Removed: Written Premiums 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: Written Premiums 2023 2022 Change 2023 2022 Change
Automobile $ 543 $ 509 7 % $ 1,072 $ 1,006 7 %
9 unchanged sentences
Premium Measures
−Removed: Three Months Ended March 31,
+Added: Three Months Ended June 30, Six Months Ended June 30,
Premium Measures 2023 2022 2023 2022
15 unchanged sentences
Underwriting Ratios
−Removed: Three Months Ended March 31,
−Removed: Underwriting Ratios 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: Underwriting Ratios 2023 2022 Change 2023 2022 Change
Loss and loss adjustment expense ratio
8 unchanged sentences
Product Combined Ratios
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Combined ratio 116.4 101.2 15.2 113.3 97.0 16.3
6 unchanged sentences
Net Income (Loss)
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Net income decreased in 2023, largely driven by a change from underwriting gain to an underwriting loss, partially offset by a decrease in net realized losses and an increase in net investment income.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Net income changed to a net loss for both the three and six months ended June 30, 2022.
+Added: For the three month period, the change was largely driven by an increase in the underwriting loss, partially offset by a decrease in net realized losses.
+Added: For the six month period, the change was largely driven by a change from an underwriting gain to an underwriting loss, partially offset by a decrease in net realized losses and an increase in net investment income.
Underwriting Gain (Loss)
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Underwriting gain (loss) changed from a gain to a loss, primarily due to higher current accident year loss costs before catastrophes in automobile, a change to net unfavorable prior accident year reserve development, and an increase in current accident year catastrophe losses.
−Removed: Expense ratio Underwriting expenses and the expense ratio decreased in 2023 as lower direct marketing costs and incremental cost savings from the Hartford Next initiative were partially offset by higher technology and operations staffing costs.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Underwriting gain (loss) Underwriting loss increased in the three month period, and changed from a gain to a loss in the six month period, primarily due to higher current accident year losses before catastrophes in automobile and an increase in current accident year catastrophe losses, partially offset by a
+Added: decrease in direct marketing costs and an increase in earned premium due to renewal pricing increases.
+Added: In the six month period, a change to net unfavorable prior accident year reserve development also contributed.
+Added: Expense ratio decreased in 2023 primarily due to lower direct marketing costs, and to a lesser extent, the impact of higher earned premium and Hartford Next savings.
Earned Premiums
Written Premiums
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Earned premiums were up in 2023 due to an increase in written premium over the prior twelve months in AARP Direct, partially offset by a decline across both Agency channels due to non-renewals exceeding new business.
−Removed: Written premiums increased in automobile in 2023 due to the effect of written pricing increases.
−Removed: Written premiums increased in homeowners in 2023 primarily due to an increase in new business and the effect of written pricing increases.
−Removed: Renewal written pricing increases were higher for both automobile and homeowners in 2023 primarily in response to recent higher loss cost trends as well as higher insured values in homeowners.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Earned premiums increased in both the three and six month periods due to an increase in written premium over the prior twelve months in both automobile and in homeowners.
+Added: Written premiums increased in automobile in both the three and six month periods due to the effect of written pricing increases.
+Added: Written premiums increased in homeowners in both the three and six month periods primarily due to an increase in new business and the effect of written pricing increases.
+Added: Renewal written pricing increases were higher for both automobile and homeowners in the three and six month periods
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Policy count retention for automobile was higher in 2023 while, for homeowners, policy count retention was flat partly due to policyholder response to pricing increases.
−Removed: Policies in-force decreased slightly in 2023 for automobile, and decreased for homeowners, compared to the end of first quarter 2022 reflecting the level of new business in relation to non-renewed policies.
+Added: ended June 30, 2023 primarily in response to recent higher loss cost trends as well as higher insured values in homeowners.
+Added: Policy count retention for automobile was higher while, for homeowners, policy count retention was flat partly due to policyholder response to pricing increases.
+Added: Policies in-force decreased in 2023 for both automobile and for homeowners compared to the end of second quarter 2022, reflecting the level of new business in relation to non-renewed policies.
Current Accident Year Loss and LAE Ratio before Catastrophes
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Current accident year Loss and LAE ratio before catastrophes increased in both automobile and homeowners in 2023.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Current accident year Loss and LAE ratio before catastrophes increased in both automobile and homeowners in both the three and six month periods.
The increase in automobile was primarily due to an increase in automobile liability and physical damage claim severity.
−Removed: The automobile severity increases include the inflationary effects on parts and repairs.
+Added: The automobile severity increases include the inflationary effects on bodily injury claims and automobile parts and repairs.
Also impacting the change for automobile between years is a higher level of frequency in the current period due to driving continuing to return to more normalized levels, largely offset by the impact of earned pricing increases.
−Removed: For homeowners, the increase in the current accident year loss and LAE ratio before catastrophes was due to an increase in severity for both weather and non-weather claims and an increase in the frequency of weather claims as compared to favorable prior year experience, partially offset by earned pricing increases.
+Added: For homeowners, the increase in the current accident year loss and LAE ratio before catastrophes was due to an increase in severity and frequency for both weather and non-weather claims and an increase in claims settlement costs, partially offset by earned pricing increases.
Contributing to the increase in homeowners severity was the effect of higher rebuilding costs due to inflation.
Current Accident Year Catastrophes and Unfavorable (Favorable) Prior Accident Year Development
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Current accident year catastrophe losses increased in 2023 compared to the prior year.
−Removed: Current accident year catastrophe losses for 2023 included tornado, wind and hail events in several regions of the United States, as well as losses from winter storms primarily on the East and West coasts.
−Removed: Current accident year catastrophe losses for the 2022 period primarily included tornado, wind and hail events in the Southeast and East coast winter storms.
−Removed: Prior accident year development was unfavorable in the 2023 period compared to favorable development in the 2022 period.
−Removed: Net unfavorable prior accident year development in the 2023 period was primarily driven by automobile physical damage.
−Removed: Net favorable prior accident year development in the 2022 period was primarily driven by automobile liability.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Current accident year catastrophe losses increased in both the three and six month periods.
+Added: Current accident year catastrophe losses for 2023 included tornado, wind and hail events across several regions of the United States, and for the six month period, included losses from winter storms primarily on the East and West coasts.
+Added: Current accident year catastrophe losses for the three and six months ended June 30, 2022 included tornado, wind and hail events primarily in the South, Midwest and Central Plains and for the six month period, winter storms along the East Coast.
+Added: Prior accident year development was favorable in the three months ended June 30, 2023 period and unfavorable in the six month period.
+Added: Net favorable prior accident year development in the three month period was primarily driven by a reduction in prior accident year catastrophes.
+Added: Net unfavorable prior accident year development in the six month period was primarily driven by automobile physical damage.
+Added: Net favorable prior accident year development in the six months ended June 30, 2022 period was primarily driven by automobile liability.
Index to MD&A
4 unchanged sentences
Underwriting Summary
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Losses and loss adjustment expenses
−Removed: Prior accident year development [1] $ 3 $ — NM
−Removed: Total losses and loss adjustment expenses 3 — NM
+Added: Prior accident year development [1] $ 2 $ 30 (93 %) $ 5 $ 30 (83 %)
+Added: Total losses and loss adjustment expenses 2 30 (93 %) 5 30 (83 %)
Underwriting expenses 2 2 — % 5 5 — %
2 unchanged sentences
Net realized losses [2] (1) (9) 89 % (4) (13) 69 %
−Removed: Income before income taxes 7 9 (22 %)
−Removed: Income tax expense [3] 1 1 — %
−Removed: Net income $ 6 $ 8 (25 %)
+Added: Income (loss) before income taxes 12 (25) 148 % 19 (16) NM
+Added: Income tax expense (benefit) [3] 3 (5) 160 % 4 (4) NM
+Added: Net income (loss) $ 9 $ (20) 145 % $ 15 $ (12) NM
[1] For additional information on prior accident year development, see Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
1 unchanged sentence
[3] For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Net income decreased in the three months ended March 31, 2023 primarily due to a higher underwriting loss, partly offset by slightly lower net realized losses.
−Removed: Underwriting loss increased in the three month period due to unfavorable prior accident year development in 2023 related to an increase in reserves for uncollectible reinsurance.
+Added: Net income (loss)
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Net income (loss) changed to net income in the three and six months ended June 30, 2023 compared to net losses in the
+Added: comparable 2022 periods primarily due to decreases in underwriting losses and net realized losses.
+Added: Underwriting loss decreased in the three and six month periods due to lower unfavorable prior accident year reserve development in the 2023 periods.
+Added: Unfavorable prior accident reserve development in the 2022 periods was primarily due to reallocating a portion of general liability reserves from Commercial Lines to P&C Other Operations related to sexual molestation and sexual abuse claims.
+Added: The reallocated reserves in 2022 related to excess liability policies written by a legal entity in P&C Other Operations for amounts owed to claimants under the agreement in principle reached with BSA on sexual molestation and sexual abuse claims in third quarter 2021.
+Added: In total for the Company, there was no change in the liability for settlement amounts owed on BSA claims.
Asbestos and environmental reserve comprehensive annual reviews will occur in the fourth quarter of 2023.
5 unchanged sentences
Operating Summary
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Premiums and other considerations $ 1,630 $ 1,517 7 % $ 3,239 $ 3,007 8 %
Net investment income [1] 113 130 (13 %) 223 253 (12 %)
−Removed: Net realized gains (losses) [1] 5 (16) 131 %
+Added: Net realized losses [1] (19) (70) 73 % (14) (86) 84 %
Total revenues 1,724 1,577 9 % 3,448 3,174 9 %
4 unchanged sentences
Total benefits, losses and expenses 1,575 1,447 9 % 3,184 3,056 4 %
−Removed: Income (loss) before income taxes 115 (12) NM
−Removed: Income tax expense (benefit) [2] 23 (4) NM
−Removed: Net income (loss) $ 92 $ (8) NM
+Added: Income before income taxes 149 130 15 % 264 118 124 %
+Added: Income tax expense [2] 28 24 17 % 51 20 155 %
+Added: Net income $ 121 $ 106 14 % $ 213 $ 98 117 %
[1] For discussion of consolidated investment results, see MD&A - Investment Results.
1 unchanged sentence
Premiums and Other Considerations
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Fully insured – ongoing premiums $ 1,574 $ 1,469 7 % $ 3,131 $ 2,907 8 %
4 unchanged sentences
Ratios, Excluding Buyouts
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Group disability loss ratio 67.0 % 66.3 % 0.7 68.7 % 69.7 % (1.0)
5 unchanged sentences
group life and disability business are not included in the expense ratio.
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
−Removed: Net income (loss) margin 5.3 % (0.5 %) 5.8
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
+Added: Net income margin 7.0 % 6.7 % 0.3 6.2 % 3.1 % 3.1
Adjustments to reconcile net income margin to core earnings margin:
−Removed: Net realized losses (gains), before tax (0.3 %) 1.0 % (1.3)
+Added: Net realized losses, before tax 0.8 % 4.1 % (3.3) 0.2 % 2.6 % (2.4)
Integration and other non-recurring M&A costs, before tax — % 0.1 % (0.1) 0.1 % 0.1 % —
−Removed: Income tax expense (benefit) 0.1 % (0.2 %) 0.3
+Added: Income tax benefit (0.2 %) (1.0 %) 0.8 (0.1 %) (0.6 %) 0.5
Core earnings margin 7.6 % 9.9 % (2.3) 6.4 % 5.2 % 1.2
2 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Net Income (Loss)
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Net income increased primarily due to a lower loss ratio, additional earnings generated by growth in fully insured ongoing premium, and a change from net realized losses in the 2022 period to net realized gains in the 2023 period, partially offset by higher insurance operating expenses and a decrease in net investment income.
−Removed: Insurance operating costs and other expenses w ere higher prim arily due to higher commissions driven by premium growth, higher staffing costs, and investments in technology, partially offset by incremental expense savings from Hartford Next.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Net income increased in both the three and six months ended June 30, 2023 due to lower net realized losses in the 2023 period and the effect of higher fully insured ongoing premium, including a lower expense ratio, partially offset by a decrease in net investment income.
+Added: In addition, the three month period was impacted by a higher loss ratio in the 2023 period while the six month period benefitted from a lower loss ratio in the 2023 period.
+Added: Insurance operating costs and other expenses w ere higher for both the three and six month periods prim arily due to the effect of premium growth, including higher commissions and staffing costs, and investments in technology, partially offset by incremental expense savings from Hartford Next and lower incentive compensation.
Fully Insured Ongoing Premiums
−Removed: [1]Other of $87 and $100 for the three months ended March 31, 2022 and 2023 respectively, which includes other group coverages such as retiree health insurance, critical illness, accident and hospital indemnity coverages.
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Fully insured ongoing premiums increased in group disability, life and other driven by strong new business sales and persistency as well as an increase in exposure on existing accounts.
−Removed: Fully insured ongoing sales increased over prior year with the increase driven by group life sales.
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Total loss ratio decreased 6.8 points in the first quarter of 2023 compared to the prior year period reflecting a lower group life and group disability loss ratio.
+Added: [1]Other of $90 and $102 for the three months ended June 30, 2022 and 2023 respectively, and $177 and $202 for the six months ended June 30, 2022 and 2023 respectively which includes other group coverages such as retiree health insurance, critical illness, accident and hospital indemnity coverages.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Fully insured ongoing premiums increased in both the three and six month periods in group disability, life and other driven by strong persistency and new business sales as well as an increase in exposure on existing accounts.
+Added: Fully insured ongoing sales decreased for the three-month period due to lower large account sales.
+Added: For the six-month period, sales increased over prior year driven by group life sales.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Total loss ratio increased 2.0 points in the three months ended June 30, 2023 compared to the prior year period reflecting higher group life and group disability loss ratios.
+Added: The group life loss ratio increased 5.5 points as the second quarter of 2022 benefitted from favorable development of $24, or 4.0 points, related to the prior quarter.
+Added: Additionally, the life loss ratio was adversely affected by higher severity in the current year as compared to the prior year.
+Added: The disability loss ratio increased 0.7 points largely due to higher incidence in paid family leave and short-term disability products, partially offset by favorable long-term disability claim incidence and recoveries.
+Added: Total loss ratio decreased 2.4 points in the six months ended June 30, 2023 compa red to the prior year period reflecting a lower group life and group disability loss ratio.
The group life loss ratio decreased 3.2 points driven by a lower level of mortality compared to the prior year period.
−Removed: The group disability loss ratio decreased 2.8 points due to favorable long-term disability claim incidence.
−Removed: Expense ratio decreased 1.2 points in the three months ended March 31, 2023 driven by higher earned premiums.
+Added: The group disability loss ratio decreased 1.0 points due to favorable long-term disability claim incidence and recoveries, partially offset by higher incidence in paid family leave and short-term disability products.
+Added: Expense ratio decreased in both the three and six month periods driven by the effect of higher earned premiums and incremental expense savings from Hartford Next, partially offset by higher staffing costs and investments in technology.
Index to MD&A
3 unchanged sentences
Operating Summary
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Fee income and other revenue $ 244 $ 263 (7 %) $ 485 $ 550 (12 %)
−Removed: Net investment income 3 1 NM
+Added: Net investment income 4 1 NM 7 2 NM
Net realized gains (losses) 1 (13) 108 % 6 (22) 127 %
9 unchanged sentences
Effect of net realized losses (gains) excluded from core earnings, before tax (0.3) 3.9 (108 %) (1.0) 3.1 (132 %)
−Removed: Effect of income tax expense (benefit) 0.3 (0.3) NM
+Added: Effect of income tax expense (benefit) — (0.9) 100 % 0.2 (0.6) 133 %
ROA, core earnings [2] 13.8 12.9 7 % 12.7 13.1 (3 %)
2 unchanged sentences
Hartford Funds Segment AUM
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Mutual Fund and ETF AUM - beginning of period $ 115,508 $ 133,985 (14 %) $ 112,472 $ 142,632 (21 %)
1 unchanged sentence
Redemptions - Mutual Fund (6,531) (9,942) 34 % (14,016) (19,987) 30 %
−Removed: Net flows - ETF 67 143 (53 %)
+Added: Net flows - ETF 210 (34) NM 277 109 154 %
Net flows - Mutual Fund and ETF (1,256) (2,011) 38 % (2,435) (2,435) — %
1 unchanged sentence
Mutual Fund and ETF AUM - end of period 118,107 115,406 2 % 118,107 115,406 2 %
−Removed: Talcott Resolution life and annuity separate account AUM [1]
−Removed: 11,672 14,061 (17 %)
+Added: Third-party life and annuity separate account AUM 11,799 11,992 (2 %) 11,799 11,992 (2 %)
Hartford Funds AUM - end of period
$ 129,906 $ 127,398 2 % $ 129,906 $ 127,398 2 %
−Removed: [1]Represents AUM of the third-party life and annuity separate accounts that are still managed by the Company's Hartford Funds segment.
Mutual Fund and ETF AUM by Asset Class
−Removed: As of March 31,
+Added: As of June 30,
2023 2022 Change
9 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Net income decreased for the three month period primarily due to lower fee income net of variable expenses as a result of a decrease in daily average assets under management, partially offset by net realized gains related to investments in funds sponsored by the Company in the 2023 period compared to net realized losses in the 2022 period
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Net income increased for the three and six month periods primarily driven by net realized gains in 2023 compared to net realized losses in 2022, partially offset by lower fee income net of variable expenses driven by a decrease in daily average assets under management.
Hartford Funds AUM
−Removed: March 31, 2023 compared to March 31, 2022
−Removed: Hartford Funds AUM decreased primarily due to a decrease in market values over the previous twelve months and, to a lesser extent, due to net outflows.
−Removed: Net outflows wer e $1.2 billion in the three months ended March 31, 2023 compared to net outflows of $0.4 billion for the three months ended March 31, 2022.
+Added: June 30, 2023 compared to June 30, 2022
+Added: Hartford Funds AUM increased primarily due to an increase in market values over the previous twelve months, partly offset by net outflows.
+Added: Net outflows wer e $1.3 billion and $2.4 billion in the three and six months ended June 30, 2023, respectively, compared to net outflows of $2.0 billion and $2.4 billion for the three and six months ended June 30, 2022.
| CORPORATE - RESULTS OF OPERATIONS
Operating Summary
−Removed: Three Months Ended March 31,
−Removed: 2023 2022 Change
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 Change 2023 2022 Change
Fee income [1] $ 11 $ 13 (15 %) $ 20 $ 26 (23 %)
2 unchanged sentences
Net realized gains (losses) 11 (30) 137 % 17 (46) 137 %
−Removed: Total revenues 26 1 NM
+Added: Total revenues (losses) 30 (14) NM 56 (13) NM
Benefits, losses and loss adjustment expenses [2] 2 2 — % 4 4 — %
8 unchanged sentences
Net loss available to common stockholders $ (31) $ (76) 59 % $ (60) $ (140) 57 %
−Removed: [1]Includes investment management fees and expenses related to managing third party business, including management of a portion of the invested assets of Talcott Resolution.
+Added: [1]Includes investment management fees and expenses related to managing third-party business.
[2]Includes benefits expense on life and annuity business previously underwritten by the Company.
−Removed: [3]For discussion of debt, see Note 13 - Debt of Notes to Consolidated Financial Statements in The Hartford's 2022 Form 10-K Annual Report.
+Added: [3]For discussion of debt, see Note 13 - Debt of Notes to Condensed Consolidated Financial Statements and Note 13 - Debt of Notes to Consolidated Financial Statements in The Hartford's 2022 Form 10-K Annual Report.
[4]For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
3 unchanged sentences
Net loss available to common stockholders
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Net loss available to common stockholders for the three months ended March 31, 2023 decreased primarily due to a change from net realized losses in the 2022 period to net realized gains in the 2023 period, lower interest expense, higher net investment income and lower restructuring charges, slightly offset by lower fee income.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Net loss available to common stockholders for the three and six months ended June 30, 2023 decreased primarily due to a change from net realized losses in the 2022 periods to net realized gains in the 2023 periods, higher net investment income, a loss on extinguishment of debt in the 2022 periods and lower interest expense, partially offset by lower fee income.
Interest expense
−Removed: Three months ended March 31, 2023 compared to the three months ended March 31, 2022
−Removed: Interest expense decreased for the three months ended March 31, 2023, largely due to the redemption of $600 in 7.875% junior subordinated debentures in April, 2022.
+Added: Three and six months ended June 30, 2023 compared to the three and six months ended June 30, 2022
+Added: Interest expense slightly decreased for the three and six months ended June 30, 2023, largely due to the redemption of $600 in 7.875% junior subordinated debentures in April, 2022.
ENTERPRISE RISK MANAGEMENT
32 unchanged sentences
The Company has established underwriting guidelines for both individual risks, including individual policy limits, and risks in the aggregate, including aggregate exposure limits by geographic zone and peril.
−Removed: The Company uses both internal and third-party models to estimate the potential loss resulting from various catastrophe events and the potential financial impact those events would have on the Company's financial position and results of operations across its businesses.
−Removed: The Hartford closely monitors scientific literature on climate change to help identify climate change risks impacting our
+Added: The Company uses both internal and third-party models to estimate the potential loss resulting from various catastrophe events and the potential financial impact those
+Added: events would have on the Company's financial position and results of operations across its businesses.
+Added: The Hartford closely monitors scientific literature on climate change to help identify climate change risks impacting our business.
We use data from the scientific community and other outside experts including partnerships with third-party catastrophe modeling firms to inform our risk management activities and stay abreast of potential implications of climate-related impacts that we incorporate into our risk assessment.
9 unchanged sentences
Reinsurance for Catastrophes - The Company utilizes various reinsurance programs to mitigate catastrophe losses including excess of loss occurrence-based treaties covering property and workers’ compensation, an aggregate property catastrophe treaty, and individual risk agreements (including facultative reinsurance) that reinsure losses from specific classes or lines of business.
−Removed: The aggregate property catastrophe treaty covers the aggregate losses of catastrophe events designated by the Property Claim Services office of Verisk and, for international business, net losses arising from two or more risks involved in the same loss occurrence totaling at least $500 thousand, in excess of a $750 retention.
−Removed: The occurrence-based property catastrophe treaty responds in excess of $150 per occurrence for all perils other than earthquakes and named hurricanes and tropical storms.
−Removed: For earthquakes and named hurricanes and tropical storms the occurrence based property treaty responds in excess of $350 per occurrence.
The occurrence property catastrophe treaty and workers’ compensation catastrophe treaties beginning with the January 1, 2021 renewal do not cover pandemic losses, as most industry reinsurance programs exclude communicable disease.
3 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Primary Catastrophe Treaty Reinsurance Coverages as of March 31, 2023 [1]
+Added: Primary Catastrophe Treaty Reinsurance Coverages as of June 30, 2023 [1]
Portion of losses reinsured Portion of losses retained by The Hartford
83 unchanged sentences
• Investing in a portfolio of high-quality and diverse securities;
−Removed: • Selling investments subject to credit risk;
+Added: • Selling investments subject to heightened credit risk;
• Hedging through use of credit default swaps;
9 unchanged sentences
Exposures are tracked on a current and potential basis and aggregated by ultimate parent of the counterparty across investments, reinsurance receivables, insurance products with credit risk, and derivatives.
−Removed: As of March 31, 2023, the Company had no investment exposure to any credit concentration risk of a single issuer or counterparty greater than 10% of the Company’s stockholders' equity, other than the U.S.
+Added: As of June 30, 2023, the Company had no investment exposure to any credit concentration risk of a single issuer or counterparty greater than 10% of the Company’s stockholders' equity, other than the U.S.
government and certain U.S.
12 unchanged sentences
In accordance with industry standards and the contractual requirements, collateral is typically settled on the same business day.
−Removed: For the three months ended March 31, 2023, the Company incurred no losses on derivative instruments due to counterparty default.
+Added: For the six months ended June 30, 2023, the Company incurred no losses on derivative instruments due to counterparty default.
For further discussion, see the Derivative Commitments section of Note 14 - Commitments and Contingencies of Notes to Condensed Consolidated Financial Statements.
10 unchanged sentences
Credit Risk of Business Operations
−Removed: The Company is subject to credit risk related to the Company's commercial business that is written with large deductible policies or retrospectively-rated plans (referred to as "loss sensitive business").
+Added: The Company is subject to credit risk related to the Company's Commercial Lines business that is written with large deductible policies or retrospectively-rated plans (referred to as "loss sensitive business").
The Company’s results of operations could be adversely affected if a significant portion of such contract holders failed to reimburse the Company for the deductible amount or the retrospectively rated policyholders failed to pay additional premiums owed.
46 unchanged sentences
Fixed Maturities, AFS by Credit Quality
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Amortized Cost Fair Value Percent of Total Fair Value Amortized Cost Fair Value Percent of Total Fair Value
6 unchanged sentences
Total fixed maturities, AFS $ 40,411 $ 37,497 100.0 % $ 39,533 $ 36,231 100.0 %
−Removed: The fair value of fixed maturities, AFS increased as compared to December 31, 2022, primarily due to an increase in valuations as a result of a decline in interest rates, partially offset by wider credit spreads.
−Removed: The increase was also due to net additions primarily within the corporate sector.
+Added: The fair value of fixed maturities, AFS increased as compared to December 31, 2022, primarily due to net additions of ABS and corporate bonds and an increase in valuations as a result of tighter credit spreads.
Fixed maturities, FVO are not included in the preceding table.
4 unchanged sentences
Fixed Maturities, AFS by Type
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value Percent of Total Fair Value Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value Percent of Total Fair Value
−Removed: Asset backed securities ("ABS")
Consumer loans $ 2,063 $ — $ — $ (39) $ 2,024 5.4 % $ 1,538 $ — $ — $ (41) $ 1,497 4.1 %
28 unchanged sentences
[1] Includes securities with pools of loans issued by the Small Business Administration which are backed by the full faith and credit of the U.S.
−Removed: The fair value of fixed maturities, AFS increased as compared with December 31, 2022, primarily due to an increase in valuations as a result of a decline in interest rates, partially offset by wider credit spreads.
−Removed: The increase was also due to net additions primarily within the corporate sector.
−Removed: The Company primarily increased holdings of financial services and basic
−Removed: industry corporate bonds, and consumer loans while primarily decreasing holdings of U.S.
+Added: The fair value of fixed maturities, AFS increased as compared with December 31, 2022, primarily due to net additions of ABS and corporate bonds and an increase in valuations as a result of tighter credit spreads.
+Added: The Company primarily increased holdings of consumer loans and financial services and basic industry corporate bonds, while primarily decreasing holdings of
treasuries and tax-exempt municipal bonds.
+Added: Commercial & Residential Real Estate
+Added: The following tables present the Company’s exposure to CMBS and RMBS by credit quality included in the preceding Fixed Maturities, AFS by Type table.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Commercial & Residential Real Estate
−Removed: The following table presents the Company’s exposure to CMBS and RMBS by credit quality included in the preceding Fixed Maturities, AFS by Type table.
−Removed: Exposure to CMBS & RMBS Bonds as of March 31, 2023
+Added: Exposure to CMBS & RMBS Bonds as of June 30, 2023
AAA AA A BBB BB and Below Total
26 unchanged sentences
A loan participation interest represents a pro-rata share in interest and principal payments generated by the participated loan, and the relationship between the Company as loan originator, lead participant and servicer and the third party as a participant are governed by a participation agreement.
−Removed: As of March 31, 2023, mortgage loans had an amortized cost of $6.1 billion and carrying value of $6.0 billion, with an ACL of $36.
+Added: As of June 30, 2023, mortgage loans had an amortized cost of $6.1 billion and carrying value of $6.0 billion, with an ACL of $41.
As of December 31, 2022, mortgage loans had an amortized cost of $6.0 billion and carrying value of $6.0 billion, with an ACL of $36.
−Removed: There was no change to the ACL on mortgage loans which currently incorporates a level of economic uncertainty and the potential impact it might have on real estate property valuations.
+Added: The increase in the allowance is primarily attributable to overall weaker projected real estate
+Added: fundamentals, and to a lesser extent, net additions of new loans.
+Added: The Company funded $304 of commercial mortgage loans with a weighted average loan-to-value (“ LTV ”) ratio of 58% and a weighted average yield of 6.8% during the six months ended June 30, 2023.
+Added: The Company continues to originate commercial mortgage loans in high growth markets across the country focusing primarily on institutional-quality industrial, multi-family, and retail properties with strong LTV ratios.
+Added: There were no mortgage loans held for sale as of June 30, 2023, or December 31, 2022.
+Added: Municipal Bonds
+Added: The following table presents the Company's exposure to municipal bonds by type and weighted average credit quality included in the preceding Securities by Type table.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: The Company funded $128 of commercial mortgage loans with a weighted average loan-to-value (“ LTV ”) ratio of 58% and a weighted average yield of 7.1% during the three months ended March 31, 2023.
−Removed: The Company continues to originate commercial mortgage loans in high growth markets across the country focusing primarily on institutional-quality industrial and multi-family properties with strong LTV ratios.
−Removed: There were no mortgage loans held for sale as of March 31, 2023, or December 31, 2022.
−Removed: Municipal Bonds
−Removed: The following table presents the Company's exposure to municipal bonds by type and weighted average credit quality included in the preceding Securities by Type table.
Available For Sale Investments in Municipal Bonds
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Amortized Cost Fair Value Weighted Average Credit Quality Amortized Cost Fair Value Weighted Average Credit Quality
17 unchanged sentences
Lease payments may be subject to annual appropriation by the municipality, or the municipality may be obligated to appropriate general tax revenues to make lease payments.
−Removed: As of both March 31, 2023 and December 31, 2022, the largest issuer concentrations were the New York City Transitional Finance Authority, the Grand Parkway Transportation Corporation of Texas, and the New York City Municipal Water Finance Authority, which each comprised less than 3% of the municipal bond portfolio and were primarily comprised of general obligation and revenue bonds.
+Added: As of June 30, 2023, the largest issuer concentrations were the Grand Parkway Transportation Corporation of Texas, the New York City Transitional Finance Authority, and the Metropolitan Transportation Authority, which each comprised less than 3% of the municipal bond portfolio and were primarily comprised of general obligation and revenue bonds.
+Added: As of December 31, 2022, the largest issuer concentrations were the Grand Parkway Transportation Corporation of Texas, the New York City Transitional Finance Authority, and the New York City Municipal Water Finance Authority, which each comprised less than 3% of the municipal bond portfolio and were primarily comprised of general obligation and revenue bonds.
In total, municipal bonds make up 12% of the fair value of the Company's investment portfolio.
Limited Partnerships and Other Alternative Investments
−Removed: The following table presents the Company’s investments in limited partnerships and other alternative investments which
−Removed: include real estate joint ventures, real estate funds, private equity funds, other funds, and other alternative investments.
+Added: The following table presents the Company’s investments in limited partnerships and other alternative investments which include real estate joint ventures, real estate funds, private equity funds, other funds, and other alternative investments.
Private equity funds primarily consist of investments in funds whose assets typically consist of a diversified pool of investments in small to mid-sized non-public businesses with high growth potential and strong owner sponsorship, as well as limited exposure to public markets.
Income or losses on investments in limited partnerships and other alternative investments are recognized on a lag as results from private equity investments and other funds are generally reported on a three-month delay.
−Removed: Index to MD&A
−Removed: Part I - Item 2.
−Removed: Management's Discussion and Analysis of Financial Condition and Results of Operations
Limited Partnerships and Other Alternative Investments - Net Investment Income
−Removed: Three Months Ended March 31,
−Removed: Amount Yield [1] Amount Yield [1]
+Added: Three Months Ended June 30, Six Months Ended June 30,
+Added: 2023 2022 2023 2022
+Added: Amount Yield [1] Amount Yield [1] Amount Yield [1] Amount Yield [1]
Real estate joint ventures and funds $ (11) (2.5 %) $ 88 23.6 % $ (27) (3.0 %) $ 139 19.7 %
5 unchanged sentences
[2]Consists of an insurer-owned life insurance policy which is primarily invested in private equity, fixed income, and hedge funds.
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
Investments in Limited Partnerships and Other Alternative Investments
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Amount Percent Amount Percent
6 unchanged sentences
Fixed Maturities, AFS — Unrealized Loss Aging
−Removed: The total gross unrealized losses were $2.8 billion as of March 31, 2023, and have decreased $661 million from December 31, 2022, primarily due to an increase in valuations as a result of a decline in interest rates, partially offset by wider credit spreads.
−Removed: As of March 31, 2023, $2.3 billion of the gross unrealized losses were associated with fixed maturities, AFS depressed less than 20% of amortized cost.
+Added: The total gross unrealized losses were $3.1 billion as of June 30, 2023, and have decreased $387 million from December 31, 2022, primarily due to an increase in valuations as a result of tighter credit spreads.
+Added: As of June 30, 2023, $2.4 billion of the gross unrealized losses were associated with fixed maturities, AFS depressed less than 20% of amortized cost.
The remaining $624 million of gross unrealized losses were associated with fixed maturities, AFS depressed greater than 20%.
−Removed: The fixed maturities, AFS depressed more than 20% primarily related to corporate fixed maturities, RMBS, and municipal bonds that are mainly depressed because current interest rates are higher and/or market spreads are wider than at the respective purchase dates.
+Added: The fixed maturities, AFS depressed more than 20% primarily related to corporate fixed maturities, RMBS, CMBS, and municipal bonds that are mainly depressed because current interest rates are higher and/or market spreads are wider than at the respective purchase dates.
As part of the Company’s ongoing investment monitoring process, the Company has reviewed its fixed maturities, AFS in an unrealized loss position and concluded that these fixed maturities are temporarily depressed and are expected to recover in value as the investments approach maturity or as market spreads tighten.
3 unchanged sentences
Unrealized Loss Aging for Fixed Maturities, AFS Securities
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Consecutive Months
6 unchanged sentences
Total 4,667 $ 36,054 $ (16) $ (3,055) $ 32,983 4,936 $ 35,771 $ (12) $ (3,442) $ 32,317
−Removed: Index to MD&A
−Removed: Part I - Item 2.
−Removed: Management's Discussion and Analysis of Financial Condition and Results of Operations
Unrealized Loss Aging for Fixed Maturities, AFS Continuously Depressed Over 20%
−Removed: March 31, 2023 December 31, 2022
+Added: June 30, 2023 December 31, 2022
Consecutive Months
6 unchanged sentences
Total 318 $ 2,450 $ (4) $ (624) $ 1,822 426 $ 3,394 $ (3) $ (875) $ 2,516
+Added: Index to MD&A
+Added: Part I - Item 2.
+Added: Management's Discussion and Analysis of Financial Condition and Results of Operations
Credit Losses on Fixed Maturities, AFS and Intent-to-Sell Impairments
−Removed: Three months ended March 31, 2023
−Removed: The Company recorded net credit losses of $5, primarily attributable to new expected credit losses of $4 on a below investment grade corporate wirelines issuer and $1 related to a CMBS that had an ACL in the prior period driven by prepayments.
−Removed: Unrealized losses on securities with an ACL recognized in other comprehensive income were $4.
+Added: Three and six months ended June 30, 2023
+Added: For the three and six months ended June 30, 2023, the Company recorded net credit losses of $3 and $8, respectively.
+Added: The net credit losses were primarily attributable to new expected credit losses of $2 and $6, respectively, related to two below investment grade corporate issuers.
+Added: For the three and six months ended June 30, 2023, unrealized losses on securities with an ACL recognized in other comprehensive income were $0 and $4, respectively.
For further information, refer to Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
−Removed: There were no intent-to-sell impairments.
+Added: There were no intent-to-sell impairments in the three and six months ended June 30, 2023.
The Company incorporates its best estimate of future performance using internal assumptions and judgments that are informed by economic and industry specific trends, as well as our expectations with respect to security specific developments.
Future intent-to-sell impairments or credit losses may develop as the result of changes in our intent to sell specific securities that are in an unrealized loss position or if modeling assumptions, such as macroeconomic factors or security specific developments, change unfavorably from our current modeling assumptions, resulting in lower cash flow expectations.
−Removed: Three months ended March 31, 2022
−Removed: The Company recorded a net increase in the ACL of $12.
+Added: Three and six months ended June 30, 2022
+Added: Changes to the ACL for the three months ended June 30, 2022, were less than $1.
+Added: For the six months ended June 30, 2022, the Company recorded a net increase in the ACL of $12.
The increase was primarily attributable to new expected credit losses on four issuers with Russian exposure.
−Removed: Unrealized losses on securities with an ACL recognized in other comprehensive income were less than $1.
−Removed: Intent-to-sell impairments of $3 were related to one corporate issuer in the financial services sector.
+Added: Unrealized losses on
+Added: securities with an ACL recognized in other comprehensive income were less than $1 for both the three and six months ended June 30, 2022.
+Added: Intent-to-sell impairments were $0 and $3 for the three and six months ended June 30, 2022, respectively, with impairments in the six month period related to one corporate issuer in the financial services sector.
ACL on Mortgage Loans
−Removed: Three months ended March 31, 2023
+Added: Three and six months ended June 30, 2023
The Company reviews mortgage loans on a quarterly basis to estimate the ACL with changes in the ACL recorded in net realized gains and losses.
1 unchanged sentence
For further information, refer to Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
−Removed: There was no change to the ACL on mortgage loans which currently incorporates a level of economic uncertainty and the potential impact it might have on real estate property valuations.
+Added: For both the three and six months ended June 30, 2023, the Company recorded an increase in the ACL on mortgage loans of $5.
+Added: The increase in the allowance is primarily attributable to overall weaker projected real estate fundamentals, and to a lesser extent, net additions of new loans.
The Company did not record an ACL on any individual mortgage loans.
−Removed: Three months ended March 31, 2022
−Removed: The Company recorded an increase in the ACL on mortgage loans of $2, primarily driven by net additions of new loans.
+Added: Three and six months ended June 30, 2022
+Added: For the three and six months ended June 30, 2022, the Company recorded an increase in the ACL on mortgage loans of $5 and $7, respectively.
+Added: The increase in the allowance is primarily attributable to the potential impact of current economic conditions on real estate property valuations and net additions of new loans.
The Company did not record an ACL on any individual mortgage loans.
5 unchanged sentences
| SUMMARY OF CAPITAL RESOURCES AND LIQUIDITY
−Removed: Capital available to the holding company as of March 31, 2023:
+Added: Capital available to the holding company as of June 30, 2023:
• Approximately $900 in fixed maturities, short-term investments, investment sales receivable and cash at the HFSG Holding Company;
• A senior unsecured revolving credit facility that provides for borrowing capacity up to $750 of unsecured credit through October 27, 2026.
−Removed: As of March 31, 2023, there were no borrowings outstanding;
+Added: As of June 30, 2023, there were no borrowings outstanding;
• An intercompany liquidity agreement that allows for short-term advances of funds among the HFSG Holding Company and certain affiliates of up to $2.0 billion for liquidity and other general corporate purposes.
−Removed: As of March 31, 2023, $1.9 billion was available, $100 was outstanding between certain affiliates and there were no amounts outstanding at the HFSG holding company.
−Removed: Dividends and other sources of capital for the three months ended March 31, 2023:
+Added: As of June 30, 2023, $1.9 billion was available, $100 was outstanding between certain affiliates and there were no amounts outstanding at the HFSG holding company.
+Added: Dividends and other sources of capital for the six months ended June 30, 2023:
The future payment of dividends from our subsidiaries is dependent on several factors including the business results, capital position and liquidity of our subsidiaries.
• P&C - HFSG Holding Company received $609 of net dividends from the Company's U.S.
−Removed: property and casualty insurance subsidiaries through March 31, 2023;
−Removed: • Group Benefits - HFSG Holding Company received $150 in dividends from Hartford Life and Accident Insurance Company (" HLA ") through March 31, 2023;
−Removed: • Hartford Funds - HFSG Holding Company received $30 in dividends from Hartford Funds through March 31, 2023.
−Removed: Expected liquidity requirements for the next twelve months as of March 31, 2023:
−Removed: • $194 of interest on debt, including, for the 3-month London Inter-Bank Offered Rate ("LIBOR") plus 2.125% Notes due 2067, interest at a rate of 4.39% given the 10-year interest rate swap agreement the Company entered into in April 2017;
+Added: property and casualty insurance subsidiaries through June 30, 2023;
+Added: • Group Benefits - HFSG Holding Company received $258 in dividends from Hartford Life and Accident Insurance Company (" HLA ") through June 30, 2023;
+Added: • Hartford Funds - HFSG Holding Company received $60 in dividends from Hartford Funds through June 30, 2023.
+Added: Expected liquidity requirements for the next twelve months as of June 30, 2023:
+Added: • $194 of interest on debt.
+Added: See Note 13 - Debt of Notes to Condensed Consolidated Financial Statements and Note 13 - Debt of Notes to Consolidated Financial Statements in The Hartford's 2022 Form 10-K Annual Report.
• $21 dividends on preferred stock, subject to the discretion of the Board of Directors;
• $525 of common stockholders' dividends, subject to the discretion of the Board of Directors and before share repurchases.
−Removed: Expected liquidity requirements for beyond the next twelve months as of March 31, 2023:
−Removed: • Interest on debt and debt repayments, see Note 13 - Debt of Notes to Consolidated Financial Statements in The Hartford's 2022 Form 10-K Annual Report;
+Added: Expected liquidity requirements for beyond the next twelve months as of June 30, 2023:
+Added: • Interest on and repayments of debt.
+Added: See Note 13 - Debt of Notes to Condensed Consolidated Financial Statements and Note 13 - Debt of Notes to Consolidated Financial Statements in The Hartford's 2022 Form 10-K Annual Report;
• Preferred stock and common stock dividends, subject to the discretion of the Board of Directors.
Equity repurchase program:
−Removed: During the three months ended March 31, 2023, the Company repurchased 4.7 million common shares for $350 under the $3.0 billion share repurchase program authorized by the Board of Directors, effective through December 31, 2024.
−Removed: As of March 31, 2023, the Company has $2.4 billion remaining for equity repurchases under the share repurchase program.
−Removed: During the period April 1, 2023 through April 26, 2023, the Company repurchased approximately 1.6 million common shares for $112.
+Added: During the six months ended June 30, 2023, the Company repurchased 9.7 million common shares for $700 under the $3.0 billion share repurchase program authorized by the Board of Directors, effective through December 31, 2024.
+Added: As of June 30, 2023, the Company has $2.0 billion remaining for equity repurchases under the share repurchase program.
+Added: During the period July 1, 2023 through July 26, 2023, the Company repurchased approximately 1.4 million common shares for $101.
The timing of any repurchases is dependent on several factors, including the market price of the Company's securities, the Company's capital position, consideration of the effect of any repurchases on the Company's financial strength or credit ratings, the Company's blackout periods, and other considerations.
2 unchanged sentences
(" HFSG Holding Company")
−Removed: The liquidity requirements of the holding company of The Hartford Financial Services Group, Inc.
−Removed: will primarily be met by HFSG Holding Company's fixed maturities;
−Removed: short-term investments and cash;
−Removed: and dividends from its subsidiaries, principally its insurance operations .
+Added: The liquidity requirements of HFSG Holding Company will primarily be met by HFSG Holding Company's fixed maturities, short-term investments and cash, and dividends from its subsidiaries, principally its insurance operations .
The Company maintains sufficient liquidity and has a variety of contingent liquidity resources to manage liquidity across a range of economic scenarios.
The HFSG Holding Company expects to continue to receive dividends from its operating subsidiaries in the future and manages capital in its operating subsidiaries to be sufficient under significant economic stress scenarios.
−Removed: Dividends from subsidiaries and other sources of funds at the holding company
+Added: Dividends from subsidiaries and other sources of funds at the holding company may be used to repurchase shares under the authorized share repurchase program at the discretion of management.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: may be used to repurchase shares under the authorized share repurchase program at the discretion of management.
Under significant economic stress scenarios, the Company has the ability to meet short-term cash requirements, if needed, by borrowing under its revolving credit facility or by having its insurance subsidiaries take collateralized advances under a facility with the FHLBB.
The Company could also choose to have its insurance subsidiaries sell certain highly liquid, high quality fixed maturities or the Company could issue debt in the public markets under its shelf registration.
−Removed: The Hartford's Board of Directors declared the following quarterly dividends since January 1, 2023:
+Added: The Hartford's Board of Directors declared the following quarterly dividends since April 1, 2023:
Common Stock Dividends
Declared Record Payable Amount per share
−Removed: February 22, 2023 March 6, 2023 April 4, 2023 $ 0.425
+Added: May 17, 2023 June 1, 2023 July 5, 2023 $ 0.425
+Added: July 19, 2023 September 1, 2023 October 3, 2023 $ 0.425
Preferred Stock Dividends
Declared Record Payable Amount per share
−Removed: February 22, 2023 May 1, 2023 May 15, 2023 $ 375.00
+Added: May 17, 2023 August 1, 2023 August 15, 2023 $ 375.00
+Added: July 19, 2023 November 1, 2023 November 15, 2023 $ 375.00
There are no current restrictions on the HFSG Holding Company's ability to pay dividends to its stockholders.
4 unchanged sentences
For a discussion of restrictions on dividends to HFSG Holding Company from its insurance subsidiaries see Part II, Item 7, MD&A – Capital Resources and Liquidity - Dividends from Subsidiaries in The Hartford’s 2022 Form 10-K Annual Report.
−Removed: Through the first three months of 2023, HFSG Holding Company received $373 of net dividends from its subsidiaries, including $150 from HLA, $30 from Hartford Funds and $193 from its U.S.
−Removed: P&C subsidiaries, excluding $12 of P&C dividends related to interest payments on an intercompany note owed by Hartford Holdings, Inc.
+Added: Through the first six months of 2023, HFSG Holding Company received $927 of net dividends from its subsidiaries, including $258 from HLA, $60 from Hartford Funds and $609 from its U.S.
+Added: P&C subsidiaries, excluding $50 of P&C dividends that were subsequently contributed to P&C subsidiaries and $25 of P&C dividends related to interest payments on an intercompany note owed by Hartford Holdings, Inc.
("HHI") to Hartford Fire Insurance Company.
8 unchanged sentences
The Hartford has a senior unsecured revolving credit facility (the "Credit Facility") that provides up to $750 of unsecured credit through October 27, 2026.
−Removed: As of March 31, 2023, no borrowings were outstanding and no letters of credit were issued under the Credit Facility and The Hartford was in compliance with all financial covenants.
+Added: As of June 30, 2023, no borrowings were outstanding and no letters of credit were issued under the Credit Facility and The Hartford was in compliance with all financial covenants.
For further information regarding the Credit Facility, see Note 13 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2022 Form 10-K Annual Report.
2 unchanged sentences
The Connecticut Department of Insurance ("CTDOI") granted approval for certain affiliated insurance companies that are parties to the agreement to treat receivables from a parent, including the HFSG Holding Company, as admitted assets for statutory accounting purposes.
−Removed: As of March 31, 2023, $1.9 billion was available, $100 was outstanding between certain affiliates and there were no amounts outstanding at the HFSG Holding Company.
+Added: As of June 30, 2023, $1.9 billion was available, $100 was outstanding between certain affiliates, and there were no amounts outstanding at the HFSG Holding Company.
Collateralized Advances with Federal Home Loan Bank of Boston
1 unchanged sentence
Membership allows these subsidiaries access to collateralized advances, which may be short- or long-term with fixed or variable rates.
−Removed: Advances may be used to support general corporate purposes, which would be presented as short- or
+Added: Advances may be used to support general
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: long-term debt, or to earn incremental investment income, which would be presented in other liabilities consistent with other collateralized financing transactions.
−Removed: As of March 31, 2023, there were no advances outstanding.
+Added: corporate purposes, which would be presented as short- or long-term debt, or to earn incremental investment income, which would be presented in other liabilities consistent with other collateralized financing transactions.
+Added: As of June 30, 2023, there were no advances outstanding.
For further information regarding collateralized advances with FHLBB, see Note 13 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2022 Form 10-K Annual Report.
1 unchanged sentence
The Hartford has entered into a committed credit facility agreement with a syndicate of lenders (the "Club Facility").
−Removed: The Club Facility has two tranches with one tranche extending a $74 commitment and the other tranche extending a £79 million ($98 as of March 31, 2023) commitment.
−Removed: As of March 31, 2023, letters of credit with aggregate face amounts of $74 and £79 million ($98), respectively, were outstanding under the Club Facility.
+Added: The Club Facility has two tranches with one tranche extending a $74 commitment and the other tranche extending a £79 million ($100 as of June 30, 2023) commitment.
+Added: As of June 30, 2023, letters of credit with aggregate face amounts of $74 and £79 million ($100), respectively, were outstanding under the Club Facility.
Among other covenants, the Club Facility contains financial covenants regarding The Hartford's consolidated net worth and financial leverage and that limit the amount of letters of credit that can support Funds at Lloyd's, consistent with Lloyd's requirements.
−Removed: As of March 31, 2023, The Hartford was in compliance with all financial covenants of the facility.
+Added: As of June 30, 2023, The Hartford was in compliance with all financial covenants of the facility.
For further information regarding the Club Facility, see Note 13 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2022 Form 10-K Annual Report.
9 unchanged sentences
For further information, refer to Note 14 - Commitments and Contingencies of Notes to Condensed Consolidated Financial Statements.
−Removed: As of March 31, 2023, no derivative positions would be subject to immediate termination in the event of a downgrade of one level below the current financial strength ratings.
+Added: As of June 30, 2023, no derivative positions would be subject to immediate termination in the event of a downgrade of one level below the current financial strength ratings.
This could change as a result of changes in our hedging activities or to the extent changes in contractual terms are negotiated.
2 unchanged sentences
The principal sources of operating funds are premiums, fees earned from insurance and administrative service agreements and investment income, while investing cash flows primarily originate from maturities and sales of invested assets.
−Removed: The Company’s insurance operations consist of property and casualty insurance products (collectively referred to as “Property & Casualty Operations”) and Group Benefits.
+Added: The Company’s insurance operations consist of property and casualty insurance products (collectively referred to as “Property & Casualty Operations”) and Group Benefits products.
The Company's insurance operations hold fixed maturity securities, including a significant short-term investment position (securities with maturities of one year or less at the time of purchase), to meet liquidity needs.
2 unchanged sentences
The following tables represent the fixed maturity holdings, including the aforementioned cash and short-term investments available to meet liquidity needs, for each of the Company’s insurance operations.
−Removed: Property & Casualty
−Removed: As of March 31, 2023
+Added: Property & Casualty Operations
+Added: As of June 30, 2023
Fixed maturities $ 29,861
3 unchanged sentences
Property & Casualty operations invested assets also include $483 in equity securities, $4.4 billion in mortgage loans and $3.6 billion in limited partnerships and other alternative investments.
−Removed: Group Benefits Operations
−Removed: As of March 31, 2023
+Added: Group Benefits
+Added: As of June 30, 2023
Fixed maturities $ 7,764
2 unchanged sentences
Total $ 8,181
−Removed: Group Benefits operations invested assets also include $216 in equity securities, $1.6 billion in mortgage loans and $904 in limited partnerships and other alternative investments.
+Added: Group Benefits invested assets also include $97 in equity securities, $1.6 billion in mortgage loans and $955 in limited partnerships and other alternative investments.
The primary uses of funds are to pay claims, claim adjustment expenses, commissions and other underwriting and insurance operating costs, to pay taxes, to purchase new investments and to make dividend payments to the HFSG Holding Company.
−Removed: Property & Casualty reserves for unpaid losses and loss adjustment expenses as of March 31, 2023 were $33.4 billion and net of reinsurance were $27.0 billion.
+Added: Property & Casualty reserves for unpaid losses and loss adjustment expenses as of June 30, 2023 were $33.0 billion and net of reinsurance were $26.6 billion.
Reserves for Property & Casualty unpaid losses and loss adjustment expenses include
2 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: case reserves and incurred but not reported (" IBNR" ).
−Removed: The ultimate amount to be paid to settle both case reserves and IBNR is an estimate, subject to significant uncertainty.
+Added: case reserves and incurred but not reported (" IBNR" ) reserves.
+Added: The ultimate amount to be paid to settle both case and IBNR reserves is an estimate, subject to significant uncertainty.
The actual amount to be paid is not finally determined until the Company reaches a settlement with the claimant.
3 unchanged sentences
In particular, there is significant uncertainty over the claim payment patterns of asbestos and environmental claims.
−Removed: Group Benefits reserves as of March 31, 2023 were $8.9 billion and net of reinsurance were $8.7 billion.
+Added: Group Benefits reserves as of June 30, 2023 were $8.9 billion and net of reinsurance were $8.7 billion.
Group life and disability obligations are estimated using assumptions based on the Company’s historical experience, modified for recent observed trends.
For a discussion of The Hartford’s judgment in estimating reserves for Group Benefits see Part II, Item 7, MD&A - Critical Accounting Estimates, Group Benefit Reserves, Net of Reinsurance, in the Company’s 2022 Form 10-K Annual Report.
−Removed: For additional information about future policy benefits and other policyholder funds and benefits payable, see Note 10 Reserve for Future Policy Benefits and and Note 11, Other Policyholder Funds and Benefits Payable of Notes to Condensed Consolidated Financial Statements and for historical payments by reserve line, net of reinsurance, see Note 11, Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Consolidated Financial Statements included in the Company's 2022 Form 10-K Annual Report.
−Removed: Due to the significance of the assumptions used, payments for the next twelve months and beyond twelve months could materially differ from historical patterns.
−Removed: Corporate includes reserves of $417 as of March 31, 2023 related to retained run-off liabilities of its former life and annuity business.
For additional information about future policy benefits and other policyholder funds and benefits payable, see Note 10 Reserve for Future Policy Benefits and Note 11, Other Policyholder Funds and Benefits Payable of Notes to Condensed Consolidated Financial Statements.
+Added: For historical payments by reserve line, net of reinsurance, see Note 11, Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Consolidated Financial Statements included in the Company's 2022 Form 10-K Annual Report.
+Added: Due to the significance of the assumptions used, payments for the next
+Added: twelve months and beyond twelve months could materially differ from historical patterns.
+Added: Corporate includes reserves of $409 as of June 30, 2023 related to retained run-off liabilities of its former life and annuity business.
+Added: For additional information about future policy benefits and other policyholder funds and benefits payable, see Note 10, Reserve for Future Policy Benefits and Note 11, Other Policyholder Funds and Benefits Payable of Notes to Condensed Consolidated Financial Statements.
Hartford Funds
Hartford Funds' principal sources of operating funds are fees earned from basis points on assets under management with uses primarily for payments to subadvisors and other general operating expenses.
−Removed: As of March 31, 2023, Hartford Funds cash and short-term investments were $259.
+Added: As of June 30, 2023, Hartford Funds cash and short-term investments were $239.
| PURCHASE AND OTHER OBLIGATIONS
6 unchanged sentences
Capital Structure
−Removed: March 31, 2023 December 31, 2022 Change
+Added: June 30, 2023 December 31, 2022 Change
Long-term debt $ 4,360 $ 4,357 — %
9 unchanged sentences
Debt to capitalization 24 % 24 %
−Removed: Total capitalization increased $665 as of March 31, 2023 compared to December 31, 2022 primarily due to a decrease in
−Removed: net unrealized losses on fixed maturities, AFS and net income in
+Added: Total capitalization increased $479 as of June 30, 2023 compared to December 31, 2022 primarily due to net income in excess of common stockholder dividends in the period and a
+Added: decrease in net unrealized losses on fixed maturities, AFS, partially offset by share repurchases.
+Added: For additional information on AOCI, net of tax, including net unrealized gain (losses) from securities, see Note 16 - Changes
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: excess of common stockholder dividends in the period, partially offset by share repurchases.
−Removed: For additional information on AOCI, net of tax, including net unrealized gain (losses) from securities, see Note 15 - Changes In and Reclassifications From Accumulated Other
−Removed: Comprehensive Income (Loss) and Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
−Removed: For additional information on debt, see Note 13 - Debt of Notes to Consolidated Financial Statement in The Hartford's 2022 Form 10-K Annual Report.
−Removed: | CASH FLOW[1]
−Removed: Three Months Ended March 31,
+Added: In and Reclassifications From Accumulated Other Comprehensive Income (Loss) and Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
+Added: For additional information on debt, see Note 13 - Debt of Notes to
+Added: Condensed Consolidated Financial Statements and Note 13 - Debt of Notes to Consolidated Financial Statement in The Hartford's 2022 Form 10-K Annual Report.
+Added: Six Months Ended June 30,
Net cash provided by operating activities $ 822 $ 1,403
−Removed: Net cash provided by (used for) investing activities $ (446) $ 126
+Added: Net cash provided by investing activities $ 53 $ 387
Net cash used for financing activities $ (1,004) $ (1,773)
Cash and restricted cash– end of period $ 222 $ 348
−Removed: Cash provided by operating activities increased in 2023 as compared to the prior year period primarily driven by an increase in P&C and Group Benefits premiums received and lower Group Benefits loss and loss adjustment expenses paid, partially offset by higher P&C loss and loss adjustment expenses paid and higher operating expenses, including increased commissions and staffing costs.
−Removed: Cash provided by (used for) investing activities decreased from net inflows in the 2022 period to net outflows in the 2023 period as a result of a change from net proceeds from to net payments for fixed maturities, partially offset by a change from net payments for to net proceeds from equity securities, as well as a decrease in net payments for mortgage loans and partnerships.
−Removed: Cash used for financing activities decreased primarily due to a decrease in share repurchases.
−Removed: Operating cash flows for the three months ended March 31, 2023 has been adequate to meet liquidity requirements.
+Added: Cash provided by operating activities decreased in 2023 as compared to the prior year period primarily driven by an increase in P&C loss and loss adjustment expenses paid, including the $787 million payment to the BSA on April 20, 2023, higher taxes paid, and higher operating expenses, including increased commissions and staffing costs, partially offset by an increase in P&C and Group Benefits premiums received and lower Group Benefits loss and loss adjustment expenses paid.
+Added: Cash provided by investing activities decreased in 2023 as a result of a change from net proceeds from to net payments for fixed maturities, a decrease in proceeds from short term investments, and a change from net proceeds from to net payments for derivatives, partially offset by a change from net payments for to net proceeds from equity securities, and a decrease in net payments for mortgage loans.
+Added: Cash used for financing activities decreased primarily due to the redemption of $600 of 7.875% junior subordinated debentures in the second quarter of 2022, and a decrease in share repurchases in 2023.
+Added: Operating cash flows for the six months ended June 30, 2023 has been adequate to meet liquidity requirements.
| EQUITY MARKETS
2 unchanged sentences
There can be no assurance that the Company’s ratings will continue for any given period of time, or that they will not be changed.
−Removed: In the event the Company’s ratings are downgraded, the Company’s competitive position, ability to access financing,
−Removed: and its cost of borrowing, may be adversely impacted.
+Added: In the event the Company’s ratings are downgraded, the Company’s competitive position, ability to access financing, and its cost of borrowing, may be adversely impacted.
Insurance Financial Strength Ratings as of
−Removed: April 26, 2023
+Added: July 26, 2023
Best Standard & Poor’s Moody’s
25 unchanged sentences
statutory capital 149 (12) 137
−Removed: U.S statutory capital at March 31, 2023
+Added: U.S statutory capital at June 30, 2023
$ 12,260 $ 2,559 $ 14,819
36 unchanged sentences
(“Berkshire”)
−Removed: Credit and Political Risk Insurance
+Added: CME Chicago Mercantile Exchange NM
Not Meaningful
−Removed: Deferred Policy Acquisition Costs
+Added: Credit and Political Risk Insurance
Net Operating Loss Carryforwards or Carrybacks
−Removed: Diversity, Equity and Inclusion
+Added: Deferred Policy Acquisition Costs
Other Comprehensive Income
−Removed: Disabled Life Reserve
+Added: Diversity, Equity and Inclusion
Over-the-Counter
−Removed: Debt Service Coverage Ratio
+Added: Disabled Life Reserve
Property and Casualty
+Added: Debt Service Coverage Ratio
+Added: Political Violence and Terrorism
Enterprise Risk and Capital Committee
−Removed: PG&E Corporation and Pacific Gas and Electric Company
+Added: Prior Accident Year Development
The Hartford Employee Stock Purchase Plan
−Removed: Political Violence and Terrorism
+Added: Risk-Based Capital
Exchange-Traded Funds
−Removed: Prior Accident Year Development
+Added: Residential Mortgage-Backed Securities
Financial Accounting Standards Board
−Removed: Risk-Based Capital
+Added: Return on Assets
Federal Home Loan Bank of Boston
−Removed: Residential Mortgage-Backed Securities
+Added: Return on Equity
Fair Value Option
−Removed: Return on Assets
+Added: SEC Securities and Exchange Commission
Generally Accepted Accounting Principles
−Removed: Return on Equity
+Added: SOFR Secured Overnight Financing Rate
Hartford Financial Services Group, Inc.
3 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.