What changed in this filing

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Item 1. Financial Statements

2024-04-25 compared with 2023-10-26 · 340 added, 575 removed, 1251 unchanged (42% of the section changed)

6 unchanged sentences

We have reviewed the accompanying condensed consolidated balance sheet of The Hartford Financial Services Group, Inc.

and subsidiaries (the "Company") as of September 30, 2023, the related condensed consolidated statements of operations, comprehensive income (loss), and changes in stockholders' equity for the three-month and nine-month periods ended September 30, 2023 and 2022, and of cash flows for the nine-month periods ended September 30, 2023 and 2022, and the related notes (collectively referred to as the "interim financial information").

and subsidiaries (the "Company") as of March 31, 2024, the related condensed consolidated statements of operations, comprehensive income, changes in stockholders' equity, and cash flows for the three-month periods ended March 31, 2024 and 2023, and the related notes (collectively referred to as the "interim financial information").

Based on our reviews, we are not aware of any material modifications that should be made to the accompanying interim financial information for it to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2022, and the related consolidated statements of operations, comprehensive income (loss), changes in stockholders' equity, and cash flows for the year then ended prior to retrospective adjustment for a change in the Company’s method of accounting for the reserve for future policy benefits (not presented herein);

and in our report dated February 24, 2023, we expressed an unqualified opinion on those consolidated financial statements.

We also audited the adjustments described in Note 1 that were applied to retrospectively adjust the December 31, 2022 consolidated balance sheet of the Company (not presented herein).

In our opinion, such adjustments are appropriate and have been properly applied to the previously issued consolidated balance sheet in deriving the accompanying retrospectively adjusted condensed consolidated balance sheet as of December 31, 2022.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheet of the Company as of December 31, 2023, and the related consolidated statements of operations, comprehensive income (loss), changes in stockholders' equity, and cash flows for the year then ended (not presented herein);

and in our report dated February 23, 2024, we expressed an unqualified opinion on those consolidated financial statements and included an explanatory paragraph regarding a change in accounting principle for the measurement and disclosure of long-duration contracts issued by insurance companies.

In our opinion, the information set forth in the accompanying condensed consolidated balance sheet as of December 31, 2023, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

Basis for Review Results

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Hartford, Connecticut

October 26, 2023

April 25, 2024

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

Condensed Consolidated Statements of Operations

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in millions, except for per share data) 2024 2023

2 unchanged sentences

Net investment income 593 515

Net realized losses ( 90 ) ( 166 ) ( 161 ) ( 649 )

Net realized gains (losses) 28 ( 7 )

Other revenues 19 20

3 unchanged sentences

Amortization of deferred policy acquisition costs ("DAC")

517 464 1,510 1,351

Insurance operating costs and other expenses 1,283 1,216

13 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

Condensed Consolidated Statements of Comprehensive Income (Loss)

Three Months Ended September 30, Nine Months Ended September 30,

Condensed Consolidated Statements of Comprehensive Income

Three Months Ended March 31,

(in millions) 2024 2023

2 unchanged sentences

Change in net unrealized gain (loss) on fixed maturities, available-for-sale ("AFS") ( 160 ) 586

Change in unrealized losses on fixed maturities for which an allowance for credit losses ("ACL") has been recorded 1 ( 5 ) ( 2 ) ( 5 )

Change in unrealized losses on fixed maturities with an allowance for credit losses ("ACL") 1 ( 6 )

Change in net gain (loss) on cash flow hedging instruments — 8

2 unchanged sentences

Change in pension and other postretirement plan adjustments 7 5

Other comprehensive loss, net of tax ( 654 ) ( 1,128 ) ( 337 ) ( 4,505 )

Comprehensive income (loss) $ ( 3 ) $ ( 788 ) $ 1,396 $ ( 3,278 )

Other comprehensive income (loss), net of tax ( 148 ) 587

Comprehensive income $ 605 $ 1,122

See Notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

Condensed Consolidated Balance Sheets

(in millions, except for share and per share data) September 30,

(in millions, except for share and per share data) March 31,

2024 December 31, 2023

1 unchanged sentence

$ 40,840 $ 39,818

Fixed maturities, at fair value using the fair value option ("FVO")

Fixed maturities, at fair value using the fair value option ("FVO Securities")

Equity securities, at fair value 736 864

5 unchanged sentences

Restricted cash 48 63

Accrued investment income

Premiums receivable and agents' balances (net of ACL of $ 111 and $ 109 )

16 unchanged sentences

Stockholders’ Equity

Preferred stock, $ 0.01 par value — 50,000,000 shares authorized, 13,800 shares issued at September 30, 2023 and December 31, 2022, aggregate liquidation preference of $ 345

Common stock, $ 0.01 par value — 1,500,000,000 shares authorized, 344,960,228 shares issued at September 30, 2023 and December 31, 2022

Preferred stock, $ 0.01 par value — 50,000,000 shares authorized, 13,800 shares issued at March 31, 2024 and December 31, 2023, aggregate liquidation preference of $ 345

Common stock, $ 0.01 par value — 1,500,000,000 shares authorized, 326,960,228 shares issued at March 31, 2024 and December 31, 2023

Additional paid-in capital 551 648

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Condensed Consolidated Statements of Changes in Stockholders' Equity

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(in millions, except for share and per share data) 2024 2023

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Accumulated Other Comprehensive Income, net of tax, beginning of period ( 2,849 ) ( 3,841 )

Total other comprehensive loss ( 654 ) ( 1,128 ) ( 337 ) ( 4,505 )

Total other comprehensive income (loss) ( 148 ) 587

Accumulated Other Comprehensive Income (Loss), net of tax, end of period ( 2,997 ) ( 3,254 )

12 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Nine Months Ended September 30,

Three Months Ended March 31,

(in millions) 2024 2023

2 unchanged sentences

Adjustments to reconcile net income to net cash provided by operating activities:

Net realized losses 161 649

Net realized losses (gains) ( 28 ) 7

Amortization of deferred policy acquisition costs 545 491

1 unchanged sentence

Depreciation and amortization 127 129

Loss on extinguishment of debt — 9

Other operating activities, net 119 122

Change in assets and liabilities:

Increase in reinsurance recoverables ( 10 ) ( 129 )

Decrease in reinsurance recoverables 11 29

Net change in accrued and deferred income taxes 102 90

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Fixed maturities, AFS 1,548 2,228

Fixed maturities, FVO 1 1

Fixed maturities, at fair value using the fair value option — —

Equity securities, at fair value 176 1,422

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Fixed maturities, AFS ( 2,752 ) ( 2,767 )

Fixed maturities, FVO — ( 216 )

Fixed maturities, at fair value using the fair value option — —

Equity securities, at fair value ( 5 ) ( 891 )

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Limited partnership and other alternative investments ( 156 ) ( 273 )

Net proceeds from (payments for) derivatives ( 133 ) 94

Net proceeds from derivatives — 23

Net additions of property and equipment ( 50 ) ( 49 )

Net proceeds from short-term investments 640 970

Net proceeds from (payments for) short-term investments 875 ( 180 )

Other investing activities, net — ( 7 )

3 unchanged sentences

Withdrawals and other deductions from investment and universal life-type contracts ( 43 ) ( 42 )

Repayment of debt — ( 600 )

Net return of shares under incentive and stock compensation plans ( 27 ) ( 32 )

4 unchanged sentences

Foreign exchange rate effect on cash — ( 6 )

Net decrease in cash and restricted cash ( 163 ) ( 52 )

Net increase (decrease) in cash and restricted cash 133 ( 126 )

Cash and restricted cash – beginning of period 189 344

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The Hartford Financial Services Group, Inc.

is a holding company for insurance and financial services subsidiaries that provide property and casualty insurance, group life and disability products and mutual funds and exchange-traded funds ("ETF") to individual and business customers in the United States as well as in the United Kingdom and other international locations (collectively, “The Hartford”, the “Company”, “we” or “our”).

is a holding company for insurance and financial services subsidiaries that provide property and casualty insurance, group benefits insurance and services and mutual funds and exchange-traded funds ("ETF") to individual and business customers in the United States as well as in the United Kingdom and other international locations (collectively, “The Hartford”, the “Company”, “we” or “our”).

The Condens ed Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.

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Actual results could differ from those estimates.

The most significant estimates include those used in determining property and casualty and group long-term disability

("LTD") insurance product reserves, net of reinsurance;

The most significant estimates include those used in determining property and casualty and group long-term disability ("LTD") insurance product reserves, net of reinsurance;

evaluation of goodwill for impairment;

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Certain reclassifications have been made to prior period financial information to conform to the current period presentation.

Adoption of New Accounting Standards

Reserve for Future Policy Benefits

On January 1, 2023, the Company adopted the Financial Accounting Standard Board's ("FASB") updated guidance on accounting for long duration insurance contracts, which was applied on a modified retrospective basis as of January 1, 2021.

The new guidance requires the discount rate assumption to be updated, as of the transition date and quarterly going forward, to a current upper-medium grade fixed-income investment yield, which has been interpreted to represent a yield based on single-A credit rated fixed maturity instruments with similar duration to the liability.

The new guidance also eliminated the requirement to adjust the reserve for future policy benefits for unrealized gains and losses on fixed maturity investments as if those unrealized gains and losses were realized (referred to as shadow reserves).

The change in the reserve estimate resulting from updating the discount rate assumptions and eliminating shadow reserves was recognized as a net cumulative effect adjustment that increased the reserve for future policy benefits by $ 85 and decreased AOCI by $ 65 , net of deferred tax effects as of January 1, 2021.

The new guidance also requires that underlying cash flow assumptions (i.e., mortality, lapse and expense) in the reserve for future policy benefits be based on best estimate assumptions.

The adjustments to the reserve for future policy benefits at adoption resulted in establishing a deferred profit liability on limited pay contracts of $ 18 representing the estimated profits based on best estimate cash flow assumptions.

The effect of adopting this guidance on the Company’s reserve for future policy benefits was as follows:

Note 1 - Basis of Presentation and Significant Accounting Policies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Impact of Adoption on Reserve for Future Policy Benefits

Payout Annuities Life Conversions Paid-up Life Deferred Profit Liability Other Total

Reserve for Future Policy Benefits as of December 31, 2020 $ 189 $ 94 $ 267 $ — $ 88 $ 638

Removal of shadow reserve [1] ( 26 ) — — — — ( 26 )

Update cash flow assumptions and establish deferred profit liability ( 16 ) — ( 2 ) 18 — —

Effect of measurement at current single-A rate [1] 59 21 29 — 2 111

Total Adjustments 17 21 27 18 2 85

Reserve for Future Policy Benefits as of January 1, 2021 206 115 294 18 90 723

Change in reserves due to changes in the single-A rate ( 11 ) ( 7 ) ( 15 ) — — ( 33 )

Other changes in reserves ( 7 ) ( 14 ) ( 17 ) 2 ( 8 ) ( 44 )

Reserve for Future Policy Benefits as of December 31, 2021 $ 188 $ 94 $ 262 $ 20 $ 82 $ 646

[1] These changes were reflected as an adjustment to opening AOCI as of January 1, 2021, with a corresponding deferred tax benefit and increase in reinsurance recoverables of $ 18 and $ 2 , respectively, resulting in a net decrease to AOCI of $ 65 .

The effect of adopting this guidance on the Company’s Condensed Consolidated Balance Sheets as of January 1, 2021 as well as December 31, 2022 and 2021, Condensed Consolidated Statements of Operations and Condensed

Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2022 was as follows:

Impact of Adoption on Condensed Consolidated Balance Sheets

As of December 31, 2022 As of December 31, 2021 As of January 1, 2021

As previously reported Effect of change As currently reported As previously reported Effect of change As currently reported Balance prior to adoption Effect of change As currently reported

Reinsurance recoverables $ 6,966 $ ( 2 ) $ 6,964 $ 6,523 $ 1 $ 6,524 $ 6,011 $ 2 $ 6,013

Deferred income taxes, net $ 1,449 $ ( 12 ) $ 1,437 $ 270 $ 11 $ 281 $ 46 $ 18 $ 64

Reserve for future policy benefits $ 561 $ ( 59 ) $ 502 $ 596 $ 50 $ 646 $ 638 $ 85 $ 723

Retained earnings $ 17,048 $ 10 $ 17,058 $ 15,764 $ 6 $ 15,770 $ 13,918 $ — $ 13,918

AOCI $ ( 3,876 ) $ 35 $ ( 3,841 ) $ 172 $ ( 44 ) $ 128 $ 1,170 $ ( 65 ) $ 1,105

Total stockholders' equity $ 13,631 $ 45 $ 13,676 $ 17,843 $ ( 38 ) $ 17,805 $ 18,556 $ ( 65 ) $ 18,491

Impact of Adoption on Condensed Consolidated Statements of Operations

Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022

As previously reported Effect of change As currently reported As previously reported Effect of change As currently reported

Benefits, losses and loss adjustment expenses $ 3,408 $ ( 1 ) $ 3,407 $ 9,602 $ ( 1 ) $ 9,601

Income before income taxes $ 431 $ 1 $ 432 $ 1,526 $ 1 $ 1,527

Income tax expense $ 92 $ — $ 92 $ 300 $ — $ 300

Net income $ 339 $ 1 $ 340 $ 1,226 $ 1 $ 1,227

Net income available to common stockholders $ 333 $ 1 $ 334 $ 1,210 $ 1 $ 1,211

Net income available to common stockholders per common share

Basic $ 1.03 $ 0.01 $ 1.04 $ 3.70 $ — $ 3.70

Diluted $ 1.02 $ — $ 1.02 $ 3.65 $ — $ 3.65

Note 1 - Basis of Presentation and Significant Accounting Policies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Impact of Adoption on Condensed Consolidated Statements of Comprehensive Income

Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022

As previously reported Effect of change As currently reported As previously reported Effect of change As currently reported

Change in net unrealized gain (loss) on fixed maturities, AFS $ ( 1,180 ) $ — $ ( 1,180 ) $ ( 4,654 ) $ ( 15 ) $ ( 4,669 )

Change in liability for future policy benefits adjustments $ — $ 24 $ 24 $ — $ 96 $ 96

Other comprehensive loss, net of tax $ ( 1,152 ) $ 24 $ ( 1,128 ) $ ( 4,586 ) $ 81 $ ( 4,505 )

Comprehensive loss $ ( 813 ) $ 25 $ ( 788 ) $ ( 3,360 ) $ 82 $ ( 3,278 )

SIGNIFICANT ACCOUNTING POLICIES

Reserve for Future Policy Benefits

The Company’s reserves for future policy benefits includes paid-up life insurance and whole-life policies resulting from conversion from group life policies included within the Group Benefits segment and reserves for run-off structured settlement and terminal funding agreement liabilities, which are reported in the Corporate category.

Contracts are grouped into cohorts by contract type and issue year.

The Company establishes reserves for future policy benefits using the net premium approach, which represents the present value of future policyholder benefits and related expenses less the present value of future net premiums.

Net premiums are calculated by multiplying gross premiums for the contracts in a specific cohort by a net premium ratio.

The net premium ratio is determined for the lifetime of a given cohort as the present value of net benefits divided by the present value of gross premiums.

Related expenses include termination and settlement costs and exclude acquisition costs and non-claim related costs, such as costs relating to investments, general administration, policy maintenance, product development, market research and general overhead or any other costs, which are expensed as incurred.

The Company estimates premiums, benefits and related expense cash flows using methods that include assumptions, such as estimates of mortality, lapse, and claim-related expenses, and the possible impact of inflation on those expenses.

Benefits include all guaranteed cash flows to be paid to the policyholder.

The reserve for future policy benefits is adjusted for differences between actual and expected experience.

Each quarter, the Company updates its estimates of cash flows expected over the life of a group of contracts using actual historical experience.

These updated cash flows are used to calculate the revised net premiums and net premium ratio, which are used to derive an updated reserve for future policy benefits.

In subsequent periods, the revised net premiums are used to measure the reserve for future policy benefits, subject to future revisions.

Future cash flow assumptions, including mortality, lapse and expense are reviewed and, if a change is indicated, updated at least annually in the third quarter.

The difference between the newly calculated reserve balance and the reserve balance before updating for actual experience and/or future cash flow assumptions is the remeasurement gain or loss, which is immaterial for the three and nine months ended September 30, 2023 and 2022, and is presented in benefits losses and loss adjustments expense in the Condensed Consolidated Statements of Operations.

Changes to the reserve due to updates to cash flow assumptions discounted at the discount rate used immediately prior to transition are recognized on a catch-up basis in the Condensed Consolidated Statement of Operations.

The discount rate assumption is an equivalent single rate that is based on a current market observable, upper-medium grade fixed maturity yield.

This has been interpreted to represent a yield based on single-A credit rated fixed maturity instruments with similar duration to the liability.

The Company uses the yield of a market observable index of single-A credit rated fixed maturities as the basis for setting the discount rate.

The discount rate assumption is updated quarterly and the change in the reserve estimate resulting from updating the discount rate assumption is recognized in other comprehensive income.

Note 2 - Earnings Per Common Share

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

EARNINGS PER COMMON SHARE

Computation of Basic and Diluted Earnings per Common Share

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(In millions, except for per share data) 2024 2023

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Diluted $ 2.47 $ 1.66

Note 3 - Segment Information

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

SEGMENT INFORMATION

1 unchanged sentence

Net Income (Loss)

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Commercial Lines $ 573 $ 421

9 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Three Months Ended March 31,

Earned premiums and fee income:

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Liability 526 486

Marine 67 60 192 175

Package business 549 484

1 unchanged sentence

Professional liability 203 188

Bond 82 77 239 226

Assumed reinsurance 181 138

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Net investment income 593 515

Net realized losses ( 90 ) ( 166 ) ( 161 ) ( 649 )

Net realized gains (losses) 28 ( 7 )

Other revenues 19 20

1 unchanged sentence

$ 6,419 $ 5,910

[1] For the three months ended September 30, 2023 and 2022, AARP members accounted for earned premiums of $ 731 and $ 695 , respectively.

For the nine months ended September 30, 2023 and 2022, AARP members accounted for earned premiums of $ 2.1 billion and $ 2.0 billion, respectively.

[1] For the three months ended March 31, 2024 and 2023, AARP members accounted for earned premiums of $ 758 and $ 689 , respectively.

Note 3 - Segment Information

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Non-Insurance Revenue from Contracts with Customers

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

Revenue Line Item 2024 2023

9 unchanged sentences

Investment management and other fees Fee income 10 9

Other Other revenues — — 1 1

Total non-insurance revenues with customers $ 352 $ 338

13 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of September 30, 2023

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of March 31, 2024

Total Quoted Prices in

18 unchanged sentences

Total fixed maturities, AFS 40,840 — 38,407 2,433

Fixed maturities, FVO 332 — 159 173

FVO securities 292 — 125 167

Equity securities, at fair value [1] 736 344 334 58

10 unchanged sentences

Foreign exchange derivatives 10 — 10 —

Interest rate derivatives ( 3 ) — ( 3 ) —

Total derivative liabilities [3] ( 22 ) — ( 22 ) —

2 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of December 31, 2023

13 unchanged sentences

Total fixed maturities, AFS 39,818 18 37,563 2,237

Fixed maturities, FVO 333 — 155 178

FVO securities 327 — 160 167

Equity securities, at fair value [1] 864 333 473 58

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Total liabilities accounted for at fair value on a recurring basis $ 8 $ — $ 8 $ —

[1] Level 3 includes investments that have contractual sales restrictions that require consent to sell and are in place for the duration that the securities are held by the Company.

[2] Includes derivative instruments in a net positive fair value position after consideration of the accrued interest and impact of collateral posting requirements which may be imposed by agreements and applicable law.

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[3] Includes derivative instruments in a net negative fair value position (derivative liability) after consideration of the accrued interest and impact of collateral posting requirements which may be imposed by agreements and applicable law.

The Company has overseas deposits included in other investments of $ 65 and $ 62 as of September 30, 2023 and December 31, 2022, respectively, which are measured at fair value using the net asset value as a practical expedient.

The Company has overseas deposits included in other investments of $ 75 as of both March 31, 2024 and December 31, 2023, which are measured at fair value using the net asset value as a practical expedient.

Fixed Maturities, Equity Securities, Short-term Investments, and Derivatives

Valuation Techniques

The Company generally determines fair values using valuation techniques that use prices, rates, and other relevant information evident from market transactions involving identical or similar instruments.

Valuation techniques also include, where appropriate, estimates of future cash flows that are converted

into a single discounted amount using current market expectations.

The Company generally determines fair values using valuation techniques that use prices, rates, and other relevant information evident from market transactions involving identical or similar

Valuation techniques also include, where appropriate, estimates of future cash flows that are converted into a single discounted amount using current market expectations.

The Company uses a "waterfall" approach comprised of the following pricing sources and techniques, which are listed in priority order:

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These services utilize recently reported trades of identical, similar, or benchmark securities making adjustments for market observable inputs available through the reporting date.

If there are no recently reported trades, they may use a discounted cash flow technique to develop a price using expected cash flows based upon the anticipated future performance of the underlying collateral discounted at an estimated market rate.

Both techniques develop prices that consider the time

If there are no recently reported trades, they may use a discounted cash flow

Note 4 - Fair Value Measurements

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

value of future cash flows and provide a margin for risk, including liquidity and credit risk.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

technique to develop a price using expected cash flows based upon the anticipated future performance of the underlying collateral discounted at an estimated market rate.

Both techniques develop prices that consider the time value of future cash flows and provide a margin for risk, including liquidity and credit risk.

Most prices provided by third-party pricing services are classified as Level 2 because the inputs used in pricing the securities are observable.

However, some securities that are less liquid or trade less actively are classified as Level 3.

Additionally, certain long-dated securities, such as municipal securities and bank loans, include benchmark interest rate or credit spread assumptions that are not observable in the marketplace and are thus classified as Level 3.

Additionally, certain long-dated securities include benchmark interest rate or credit spread assumptions that are not observable in the marketplace and are thus classified as Level 3.

• Internal matrix pricing is a valuation process internally developed for private placement securities for which the Company is unable to obtain a price from a third-party pricing service.

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THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Valuation Inputs Used in Levels 2 and 3 Measurements for Securities and Derivatives

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• Independent broker quotes

• For privately traded investments, credit spreads for public securities of similar quality, maturity, and sector, adjusted for non-public nature

Credit derivatives

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THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Significant Unobservable Inputs for Level 3 - Securities

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Value Predominant

Technique Significant

Unobservable Input Minimum Maximum Weighted Average [1] Impact of

Technique Significant Unobservable Input Minimum Maximum Weighted Average [1] Impact of

Input on Fair Value [2]

As of September 30, 2023

As of March 31, 2024

CLO [3] $ 124 Discounted cash flows Spread 259 bps 260 bps 260 bps Decrease

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Loss severity [6] 10 % 70 % 41 % Decrease

Short-term investments [3] $ 15 Discounted cash flows Spread 579 bps 1,254 bps 1,225 bps Decrease

[1] The weighted average is determined based on the fair value of the securities.

5 unchanged sentences

[6] Generally, a change in the assumption used for the constant default rate would have been accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumption used for constant prepayment rate and would have resulted in wider spreads .

As of September 30, 2023 and December 31, 2022, the fair values of the Company's level 3 derivatives were less than $ 1 for both periods.

As of March 31, 2024 and December 31, 2023, the fair values of the Company's level 3 derivatives were less than $ 1 for both periods.

The table above excludes certain securities for which fair values are predominately based on independent broker quotes.

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Therefore, similar to non-broker priced securities, increases in these inputs would generally cause fair values to decrease.

As of September 30, 2023, no significant adjustments were made by the Company to broker prices received.

As of March 31, 2024, no significant adjustments were made by the Company to broker prices received.

Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs

3 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Fair Value Rollforwards for Financial Instruments Classified as Level 3 for the

Three Months Ended September 30, 2023

Total realized/unrealized gains (losses)

Fair value as of June 30, 2023 Included in net income [1] Included in OCI [2] Purchases Settlements Sales Transfers into Level 3 [3] Transfers out of Level 3 [3] Fair value as of September 30, 2023

Fixed maturities, AFS

ABS $ — $ — $ — $ 46 $ — $ — $ — $ — $ 46

CLO 85 — — 15 ( 3 ) — — — 97

CMBS 238 — 1 — ( 14 ) — 1 — 226

Corporate 1,622 ( 4 ) ( 24 ) 113 ( 69 ) ( 1 ) 19 ( 1 ) 1,655

RMBS 69 — — 21 ( 7 ) — — ( 19 ) 64

Total fixed maturities, AFS 2,014 ( 4 ) ( 23 ) 195 ( 93 ) ( 1 ) 20 ( 20 ) 2,088

Fixed maturities, FVO 163 13 — — ( 3 ) — — — 173

Equity securities, at fair value 59 — — — ( 1 ) — — — 58

Short-term investments 186 — — 2 ( 3 ) — — — 185

Total Assets $ 2,422 $ 9 $ ( 23 ) $ 197 $ ( 100 ) $ ( 1 ) $ 20 $ ( 20 ) $ 2,504

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Fair Value Rollforwards for Financial Instruments Classified as Level 3 for the

Nine Months Ended September 30, 2023

Three Months Ended March 31, 2024

Total realized/unrealized gains (losses)

Fair value as of January 1, 2023 Included in net income [1] Included in OCI [2] Purchases Settlements Sales Transfers into Level 3 [3] Transfers out of Level 3 [3] Fair value as of September 30, 2023

Fair value as of January 1, 2024 Included in net income [1] Included in OCI [2] Purchases Settlements Sales Transfers into Level 3 [3] Transfers out of Level 3 [3] Fair value as of March 31, 2024

Fixed maturities, AFS

5 unchanged sentences

Total fixed maturities, AFS 2,237 — ( 5 ) 290 ( 46 ) ( 2 ) 6 ( 47 ) 2,433

Fixed maturities, FVO 178 — — — ( 5 ) — — — 173

Equity Securities, at fair value 61 ( 2 ) — 1 ( 2 ) — — — 58

Short-term investments 193 — — 6 ( 14 ) — — — 185

Total Assets $ 2,483 $ ( 9 ) $ 7 $ 420 $ ( 241 ) $ ( 15 ) $ 67 $ ( 208 ) $ 2,504

Note 4 - Fair Value Measurements

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Fair Value Rollforwards for Financial Instruments Classified as Level 3 for the

Three Months Ended September 30, 2022

Total realized/unrealized gains (losses)

Fair value as of June 30, 2022 Included in net income [1] Included in OCI [2] Purchases Settlements Sales Transfers into Level 3 [3] Transfers out of Level 3 [3] Fair value as of September 30, 2022

Fixed Maturities, AFS

CLO $ 164 $ — $ — $ 31 $ ( 13 ) $ — $ — $ ( 27 ) $ 155

CMBS 224 — ( 1 ) 4 ( 7 ) — — — 220

Corporate 1,609 ( 1 ) ( 52 ) 75 ( 13 ) ( 9 ) 24 ( 31 ) 1,602

Foreign Govt./Govt.

Agencies 5 1 — — — ( 2 ) — — 4

RMBS 130 — ( 3 ) — ( 19 ) — — — 108

Total Fixed Maturities, AFS 2,132 — ( 56 ) 110 ( 52 ) ( 11 ) 24 ( 58 ) 2,089

Fixed maturities, FVO 193 ( 4 ) — — ( 3 ) — — — 186

FVO securities 167 3 — — ( 3 ) — — — 167

Equity securities, at fair value 58 — — — — — — — 58

2 unchanged sentences

Fair Value Rollforwards for Financial Instruments Classified as Level 3 for the

Nine Months Ended September 30, 2022

Three Months Ended March 31, 2023

Total realized/unrealized gains (losses)

Fair value as of January 1, 2022 Included in net income [1] Included in OCI [2] Purchases Settlements Sales Transfers into Level 3 [3] Transfers out of Level 3 [3] Fair value as of September 30, 2022

Fair value as of January 1, 2023 Included in net income [1] Included in OCI [2] Purchases Settlements Sales Transfers into Level 3 [3] Transfers out of Level 3 [3] Fair value as of March 31, 2023

Fixed maturities, AFS

3 unchanged sentences

Corporate 1,589 1 31 66 ( 51 ) ( 7 ) 27 ( 13 ) 1,643

Foreign Govt./Govt.

Agencies 5 — ( 1 ) — — ( 3 ) 3 — 4

RMBS 95 — — — ( 8 ) — — ( 30 ) 57

Total fixed maturities, AFS 2,051 1 26 146 ( 63 ) ( 7 ) 37 ( 73 ) 2,118

Fixed maturities, FVO 160 ( 15 ) — 55 ( 14 ) — — — 186

FVO securities 178 ( 8 ) — — 2 — — — 172

Equity securities, at fair value 61 ( 1 ) — 1 ( 1 ) — — — 60

4 unchanged sentences

[2] All amounts are before income taxes.

[3] Transfers in and/or (out) of Level 3 are primarily attributable to the availability of market observable information and the re-evaluation of the observability of pricing inputs.

[3] Transfers into and/or (out of) Level 3 are primarily attributable to the availability of market observable information and the re-evaluation of the observability of pricing inputs.

Note 4 - Fair Value Measurements

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Changes in Unrealized Gains (Losses) for Financial Instruments Classified as

Level 3 Still Held at End of Period

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

2024 2023 2024 2023

Changes in Unrealized Gains (Losses) included in Net Income [1] [2] Changes in Unrealized Gains (Losses) included in OCI [3] Changes in Unrealized Gain/(Loss) included in Net Income [1] [2] Changes in Unrealized Gain/(Loss) included in OCI [3]

Changes in Unrealized Gain/(Loss) included in Net Income [1] [2] Changes in Unrealized Gain/(Loss) included in OCI [3]

Fixed maturities, AFS

CLO $ — $ — $ — $ — $ — $ — $ 1 $ ( 2 )

CMBS $ — $ — $ 10 $ ( 5 )

Corporate — — ( 15 ) 31

Foreign Govt./Govt.

Agencies — 1 — — — — — ( 1 )

RMBS — — — ( 3 ) — — — ( 12 )

Total fixed maturities, AFS — — ( 5 ) 26

Fixed maturities, FVO 13 ( 4 ) — — — ( 15 ) — —

Equity Securities, at fair value — 1 — — ( 1 ) 2 — —

FVO securities 3 ( 8 ) — —

Total Assets $ 3 $ ( 8 ) $ ( 5 ) $ 26

5 unchanged sentences

The Company has elected the fair value option for certain investments in residual interests of securitizations and other securities that contain embedded credit derivatives with underlying credit risk related to residential real estate in order to reflect changes in fair value in earnings.

These instruments are included within fixed maturities, FVO on the Condensed Consolidated Balance Sheets and changes in the fair value of these investments are reported in net realized gains and losses.

As of September 30, 2023 and December 31, 2022, the fair value of assets using the fair value option was $ 332 and $ 333 ,

respectively, of which $ 173 and $ 178 , respectively, were residual interests of securitizations.

For the three and nine months ended September 30, 2023, realized gains related to the change in fair value of assets using the fair value option were $ 16 and $ 5 , respectively.

For the three and nine months ended September 30, 2022, realized losses related to the change in fair value of assets using the fair value option were $ 3 and $ 26 , respectively.

These instruments are included within FVO securities on the Condensed Consolidated Balance Sheets and changes in the fair value of these investments are reported in net realized gains and losses.

As of March 31, 2024 and December 31, 2023, the fair value of assets using the fair value option was $ 292 and $ 327 , respectively, of which $ 167 were residual interests of securitizations for both periods.

For the three months ended March 31, 2024 and 2023, realized gains (losses) related to the change in fair value of assets using the fair value option were $ 4 and $( 8 ), respectively.

Financial Instruments Not Carried at Fair Value

Financial Assets and Liabilities Not Carried at Fair Value

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Fair Value Hierarchy Level Carrying Amount [1] Fair Value Fair Value Hierarchy Level Carrying Amount [1] Fair Value

3 unchanged sentences

Junior subordinated debentures [2] Level 2 $ 499 $ 445 Level 2 $ 499 $ 429

[1] As of September 30, 2023 and December 31, 2022, the carrying amount of mortgage loans is net of ACL of $ 46 and $ 36 , respectively.

[1] As of March 31, 2024 and December 31, 2023, the carrying amount of mortgage loans is net of ACL of $ 48 and $ 51 , respectively.

[2] Included in long-term debt in the Condensed Consolidated Balance Sheets, except for any current maturities, which are included in short-term debt when applicable.

1 unchanged sentence

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Net Realized Gains (Losses)

Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31,

(Before tax) 2024 2023

Gross gains on sales of fixed maturities

$ 6 $ 16 $ 26 $ 54

Gross losses on sales of fixed maturities

6 unchanged sentences

Change in ACL on mortgage loans 3 —

Intent-to-sell impairments — ( 2 ) — ( 5 )

Other, net [2] ( 3 ) ( 15 )

Net realized gains (losses) $ 28 $ ( 7 )

[1] The change in net unrealized gains (losses) on equity securities still held as of September 30, 2023 and included in net realized gains (losses) were $( 14 ) and $( 5 ) for the three and nine months ended September 30, 2023, respectively.

The change in net unrealized gains (losses) on equity securities still held as of September 30, 2022 and included in net realized gains (losses) were $( 84 ) and $( 439 ) for the three and nine months ended September 30, 2022, respectively.

[2] For the three and nine months ended September 30, 2023 includes gains (losses) from transactional foreign currency revaluation of $ 13 and $( 3 ), respectively, and gains (losses) on non-qualifying derivatives of $( 74 ) and $( 108 ), respectively.

For the three and nine months ended September 30, 2022 includes gains (losses) from transactional foreign currency revaluation of $ 16 and $ 37 , respectively, and gains (losses) on non-qualifying derivatives of $( 19 ) and $ 42 , respectively.

Proceeds from the sales of fixed maturities, AFS totaled $ 0.8 billion and $ 2.8 billion for the three and nine months ended September 30, 2023, respectively, and $ 1.5 billion and $ 9.6 billion for the three and nine months ended September 30, 2022, respectively.

Accrued Interest Receivable on Fixed Maturities, AFS and Mortgage Loans

As of September 30, 2023 and December 31, 2022, the Company reported accrued interest receivable related to fixed maturities, AFS of $ 369 and $ 338 , respectively, and accrued interest receivable related to mortgage loans of $ 19 and $ 18 , respectively.

These amounts are recorded in other assets on the Condensed Consolidated Balance Sheets and are not included in the carrying value of the fixed maturities or mortgage loans.

The Company does not include the current accrued interest receivable balance when estimating the ACL.

The Company has a policy to write-off accrued interest receivable balances that are more than 90 days past due.

Write-offs of accrued interest receivable are recorded as a credit loss component of net realized gains and losses.

Interest income on fixed maturities and mortgage loans is accrued unless it is past due over 90 days or management deems the interest uncollectible.

[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 $ 36 and $ 2 for the three months ended March 31, 2024, and 2023, respectively.

[2] For the three months ended March 31, 2024, and 2023 includes gains (losses) from transactional foreign currency revaluation of $ 2 and $( 7 ), respectively, and gains (losses) on non-qualifying derivatives of $( 2 ), and $ 5 , respectively.

Proceeds from the sales of fixed maturities, AFS totaled $ 0.4 billion and $ 1.4 billion for the three months ended March 31, 2024 and 2023, respectively.

Accrued Investment Income on Fixed Maturities, AFS and Mortgage Loans

As of March 31, 2024 and December 31, 2023, the Company reported accrued investment income related to fixed maturities, AFS of $ 381 and $ 371 , respectively, and accrued investment income related to mortgage loans of $ 21 and $ 20 , respectively.

These amounts are not included in the carrying value of the fixed maturities or mortgage loans.

Investment income on fixed maturities and mortgage loans is accrued unless it is past due over 90 days or management deems the interest uncollectible.

The Company does not include the current accrued investment income balance when estimating the ACL.

The Company has a policy to write-off accrued investment income balances that are more than 90 days past due.

Write-offs of accrued investment income are recorded as a credit loss component of net realized gains and losses.

Recognition and Presentation of Intent-to-Sell Impairments and ACL on Fixed Maturities, AFS

8 unchanged sentences

The ACL is written off against the amortized cost in the period in which all or a portion of the related fixed maturity is determined to be uncollectible .

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Developing the Company’s best estimate of expected future cash flows is a quantitative and qualitative process that incorporates information received from third-party sources along with certain internal assumptions regarding the future performance.

The Company's considerations include, but are not limited to, (a) changes in the financial condition of the issuer and/or the underlying collateral, (b) whether the issuer is current on contractually obligated interest and principal payments, (c) credit ratings, (d) payment structure of the security and (e) the extent to which the fair value has been less than the amortized cost of the security.

For non-structured securities, assumptions include, but are not limited to, economic and industry-specific trends and fundamentals, instrument-specific developments including

changes in credit ratings, industry earnings multiples and the issuer’s ability to restructure, access capital markets, and execute asset sales.

For non-structured securities, assumptions include, but are not limited to, economic and industry-specific trends and fundamentals, instrument-specific developments including changes in credit ratings, industry earnings multiples and the issuer’s ability to restructure, access capital markets, and execute asset sales.

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

For structured securities, assumptions include, but are not limited to, various performance indicators such as historical and projected default and recovery rates, credit ratings, current and projected delinquency rates, loan-to-value (" LTV") ratios, average cumulative collateral loss rates that vary by vintage year, prepayment speeds, and property value declines.

These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries which may include estimating the underlying collateral value.

ACL on Fixed Maturities, AFS by Type

Three Months Ended September 30,

(Before tax) Corporate CMBS Total Corporate Foreign govt./govt.

agencies CMBS Total

Balance as of beginning of period $ 6 $ 12 $ 18 $ 8 $ 4 $ 1 $ 13

Credit losses on fixed maturities where an allowance was not previously recorded 3 — 3 — — 6 6

Reduction due to sales ( 3 ) — ( 3 ) — ( 1 ) — ( 1 )

Reduction due to intent to sell — — — — ( 3 ) — ( 3 )

Net increases (decreases) on fixed maturities where an allowance was previously recorded 2 — 2 — — — —

Balance as of end of period $ 8 $ 12 $ 20 $ 8 $ — $ 7 $ 15

assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries which may include estimating the underlying collateral value.

ACL on Fixed Maturities, AFS by Type

Nine Months Ended September 30,

(Before tax) Corporate CMBS Total Corporate Foreign govt./govt.

agencies CMBS Total

Three Months Ended March 31,

(Before tax) Corporate CMBS Total Corporate CMBS Total

Balance as of beginning of period $ 9 $ 12 $ 21 $ 2 $ 10 $ 12

Credit losses on fixed maturities where an allowance was not previously recorded — — — 4 — 4

Reduction due to sales ( 5 ) — ( 5 ) — ( 1 ) — ( 1 )

Reduction due to intent to sell — — — — ( 3 ) — ( 3 )

Net increases (decreases) on fixed maturities where an allowance was previously recorded 1 — 1 — 1 1

Write-offs charged against the allowance ( 4 ) — ( 4 ) — — —

Balance as of end of period $ 6 $ 12 $ 18 $ 6 $ 11 $ 17

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Fixed Maturities, AFS

Fixed Maturities, AFS, by Type

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Cost ACL Gross

11 unchanged sentences

Fixed Maturities, AFS, by Contractual Maturity Year

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Amortized Cost Fair Value Amortized Cost Fair Value

6 unchanged sentences

Total fixed maturities, AFS $ 42,946 $ 40,840 $ 41,726 $ 39,818

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Estimated maturities may differ from contractual maturities due to call or prepayment provisions.

1 unchanged sentence

Concentration of Credit Risk

The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk.

The Company had no investment exposure to any credit concentration risk of a single issuer greater than 10% of the Company's stockholders' equity as of September 30, 2023 or December 31, 2022 other than U.S.

The Company aims to maintain a diversified investment portfolio including issuer, sector and geographic stratification, where

applicable, and has established certain exposure limits, diversification standards and review procedures to mitigate credit risk.

The Company had no investment exposure to any credit concentration risk of a single issuer greater than 10% of the Company's stockholders' equity as of March 31, 2024 or December 31, 2023 other than U.S.

government securities and certain U.S.

government agencies.

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Unrealized Losses on Fixed Maturities, AFS

Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of September 30, 2023

Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of March 31, 2024

Less Than 12 Months 12 Months or More Total

23 unchanged sentences

Total fixed maturities, AFS in an unrealized loss position $ 2,397 $ ( 41 ) $ 25,170 $ ( 2,264 ) $ 27,567 $ ( 2,305 )

As of September 30, 2023, fixed maturities, AFS in an unrealized loss position consisted of 5,020 instruments and were primarily depressed due to higher interest rates and/or wider credit spreads since the purchase date.

As of September 30, 2023, 88 % of these fixed maturities were depressed less than 20% of cost or amortized cost.

The increase in unrealized losses during the nine months ended September 30, 2023, was primarily due to a decrease in valuations as a result of higher interest rates.

Most of the fixed maturities depressed for twelve months or more relate to the corporate sector, municipal bonds, RMBS, and CMBS which were primarily depressed because current rates are higher and/or market spreads are wider than at the respective purchase dates.

As of March 31, 2024, fixed maturities, AFS in an unrealized loss position consisted of 4,002 instruments and were primarily depressed due to higher interest rates and/or wider credit spreads since the purchase date.

As of March 31, 2024, 95 % of these fixed maturities were depressed less than 20% of cost or amortized cost.

The increase in unrealized losses during the three months ended March 31, 2024, was primarily attributable to higher interest rates, partially offset by tighter credit spreads.

Most of the fixed maturities depressed for twelve months or more relate to the corporate sector, RMBS, municipal bonds, and CMBS which were primarily depressed because current rates are higher and/or market spreads are wider than at the

respective purchase dates.

The Company neither has an intention to sell nor does it expect to be required to sell the fixed maturities outlined in the preceding discussion.

2 unchanged sentences

ACL on Mortgage Loans

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.

The Company reviews mortgage loans on a quarterly basis to estimate the ACL with changes in the ACL recorded in net

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

realized gains and losses.

Apart from an ACL recorded on individual mortgage loans where the borrower is experiencing financial difficulties, the Company records an ACL on the pool of mortgage loans based on lifetime expected credit losses.

3 unchanged sentences

The first two to four years of the 10-year period assume a specific modeled economic scenario (including moderate upside, moderate recession and severe recession scenarios) and then revert to historical long-term assumptions over the remaining period.

Using these economic scenarios, the forecasting model projects property-specific operating income and capitalization rates used

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

to estimate the value of a future operating income stream.

Using these economic scenarios, the forecasting model projects property-specific operating income and capitalization rates used to estimate the value of a future operating income stream.

The operating income and the property valuations derived from capitalization rates are compared to loan payment and principal amounts to create debt service coverage ratios ("DSCRs") and LTVs over the forecast period.

6 unchanged sentences

Estimates of collectibility from an individual borrower require the use of significant management judgment and include the probability and timing of borrower default and loss severity estimates.

In addition, cash flow projections may change based upon new information about the borrower's ability to pay and/or the value of underlying collateral such as changes in projected property value estimates.

As of September 30, 2023, the Company did no t have any mortgage loans for which an ACL was established on an individual basis.

There were no mortgage loans held-for-sale as of September 30, 2023 or December 31, 2022.

For the three and nine months ended September 30, 2023 and 2022, respectively, the Company had no mortgage loans that have had extensions

or restructurings other than what is allowable under the original terms of the contract.

In addition, cash

flow projections may change based upon new information about the borrower's ability to pay and/or the value of underlying collateral such as changes in projected property value estimates.

As of March 31, 2024, the Company did no t have any mortgage loans for which an ACL was established on an individual basis.

There were no mortgage loans held-for-sale as of March 31, 2024 or December 31, 2023.

In addition, as of March 31, 2024 and 2023, the Company had no mortgage loans that have had extensions or restructurings other than what is allowable under the original terms of the contract or with borrowers experiencing financial difficulties.

ACL on Mortgage Loans

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

ACL as of beginning of period $ 51 $ 36

Current period provision (release) ( 3 ) —

ACL as of September 30, $ 46 $ 36 $ 46 $ 36

The increase in the allowance for the 2023 period is primarily attributable to revised economic scenarios, lower property valuations, and overall weaker real estate fundamentals.

The weighted-average LTV ratio of the Company’s mortgage loan portfolio was 53 % as of September 30, 2023, while the weighted-average LTV ratio at origination of these loans was 59 %.

ACL as of December 31, $ 48 $ 36

The release in the allowance for the three months ended March 31, 2024 is primarily attributable to improved economic scenario forecasts and property specific reductions, partially offset by net additions of new loans.

The weighted-average LTV ratio of the Company’s mortgage loan portfolio was 55 % as of March 31, 2024, while the weighted-average LTV ratio at origination of these loans was 59 %.

LTV ratios compare the loan amount to the value of the underlying property collateralizing the loan with property values based on appraisals updated no less than annually.

1 unchanged sentence

DSCR compares a property’s net operating income to the borrower’s principal and interest payments and are updated no less than annually through reviews of underlying properties.

Mortgage Loans LTV & DSCR by Origination Year as of September 30, 2023

Mortgage Loans LTV & DSCR by Origination Year as of March 31, 2024

2024 2023 2022 2021 2020 2019 & Prior Total

12 unchanged sentences

[1] Amortized cost of mortgage loans excludes ACL of $ 48 .

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Mortgage Loans LTV & DSCR by Origination Year as of December 31, 2023

13 unchanged sentences

[1] Amortized cost of mortgage loans excludes ACL of $ 51 .

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Mortgage Loans by Region

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Amortized Cost Percent of Total Amortized Cost Percent of Total

13 unchanged sentences

Mortgage Loans by Property Type

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Amortized Cost Percent of Total Amortized Cost Percent of Total

3 unchanged sentences

Retail [1] 927 14.8 % 917 14.9 %

Other — — % 40 0.7 %

Single Family 80 1.3 % 80 1.3 %

Total mortgage loans 6,245 100.0 % 6,138 100.0 %

4 unchanged sentences

Mortgage loans are considered past due if a payment of principal or interest is not received according to the contractual terms of the loan agreement, which typically includes a grace period.

As of September 30, 2023 and December 31, 2022, the Company held no mortgage loans considered past due.

As of March 31, 2024 and December 31, 2023, the Company held no mortgage loans considered past due.

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Mortgage Servicing

The Company originates, sells and services commercial mortgage loans on behalf of third parties and recognizes servicing fee income over the period that services are performed.

As of September 30, 2023, under this program, the Company serviced mortgage loans with a total outstanding principal of $ 9.5 billion, of which $ 4.5 billion was serviced on

behalf of third parties and $ 5.0 billion was retained and reported in total investments on the Company's Condensed Consolidated Balance Sheets.

As of March 31, 2024, under this program, the Company serviced mortgage loans with a total outstanding principal of $ 9.6 billion, of which $ 4.5 billion was serviced on behalf of third parties and $ 5.1 billion was retained and reported in total investments on the Company's Condensed Consolidated Balance Sheets.

As of December 31, 2023, the Company serviced mortgage loans with a total outstanding principal balance of $ 9.4 billion, of which $ 4.4 billion was serviced on behalf of third parties and $ 5.0 billion was retained and reported in total investments on the Company's Condensed Consolidated Balance Sheets.

Servicing rights are carried at the lower of cost or fair value and were $ 0 as of September 30, 2023 and December 31, 2022, because servicing fees were market-level fees at origination and remain adequate to compensate the Company for servicing the loans.

Servicing rights are carried at the lower of cost or fair value and were $ 0 as of March 31, 2024 and December 31, 2023, because servicing fees were market-level fees at origination and remain adequate to compensate the Company for servicing the loans.

Variable Interest Entities

5 unchanged sentences

Consolidated VIEs

As of September 30, 2023 and December 31, 2022, the Company did no t hold any securities for which it is the primary beneficiary.

As of March 31, 2024 and December 31, 2023, the Company did no t hold any securities for which it is the primary beneficiary.

Non-Consolidated VIEs

1 unchanged sentence

For these non-consolidated VIEs, the Company has determined it is not the primary beneficiary as it has no ability to direct activities that could significantly affect the economic performance of the investments.

The Company’s maximum exposure to loss as of September 30, 2023 and December 31, 2022 was limited to the total carrying value of $ 2.8 billion and $ 2.6 billion, respectively, which are a portion of the investments in limited partnerships and other alternative investments in the Company's Condensed Consolidated Balance Sheets that are primarily recorded using the equity method of accounting.

As of September 30, 2023 and December 31, 2022, the Company has outstanding commitments totaling $ 1.8 billion for both periods, whereby the Company is committed to fund these investments and may be called by the partnership during the commitment period to fund the purchase of new investments and partnership expenses.

The Company’s maximum exposure to loss as of March 31, 2024 and December 31, 2023 was limited to the total carrying value of $ 3.0 billion for both periods, which are a portion of the investments in limited partnerships and other alternative investments in the Company's Condensed Consolidated Balance Sheets that are primarily recorded using the equity method of accounting.

As of March 31, 2024 and December 31,

2023, the Company has outstanding commitments totaling $ 1.7 billion for both periods, whereby the Company is committed to fund these investments and may be called by the partnership during the commitment period to fund the purchase of new investments and partnership expenses.

These investments are generally of a passive nature in that the Company does not take an active role in management.

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

further discussion of these investments, see Equity Method Investments within Note 5 - Investments of Notes to Consolidated Financial Statements included in the Company’s 2022 Form 10-K Annual Report.

For further discussion of these investments, see Equity Method Investments within Note 5 - Investments of Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K Annual Report.

Furthermore, the Company makes investments in entities that sponsor affordable housing projects.

Similarly, for these non-consolidated VIEs, the Company has determined it is not the primary beneficiary as it has no ability to direct activities that could significantly affect the economic performance of the investments.

The Company applies the proportional amortization method to subsequently measure its investments in such qualified affordable housing projects, where costs are amortized over the period in which the investor expects to receive tax credits and the resulting amortization is recognized as a component of income tax expense on the Company's Condensed Consolidated Statements of Operations.

For the three months ended March 31, 2024, and 2023, the Company recognized amortization of $ 1 and less than $ 1 , respectively, and related tax benefits of $ 2 and less than $ 1 , respectively.

The income tax credits and other income tax benefits are recognized in operating activities in the Condensed Consolidated Statement of Cash Flows.

The carrying value of these investments, which are reported in other assets on the Company’s Condensed Consolidated Balance Sheets was $ 22 and $ 20 as of March 31, 2024, and December 31, 2023, respectively.

As of March 31, 2024 and December 31, 2023, the Company has outstanding commitments related to affordable housing projects of $ 177 and $ 180 , respectively, that are contingent on various conditions precedent to funding.

In addition, the Company makes passive investments in structured securities issued by VIEs for which the Company is not the manager.

These investments are included in ABS, CLO, CMBS, and RMBS and are reported in fixed maturities, AFS, and fixed maturities, FVO, on the Company's Condensed Consolidated Balance Sheets.

These investments are included in ABS, CLO, CMBS, and RMBS and are reported in fixed maturities, AFS, and FVO securities on the Company's Condensed Consolidated Balance Sheets.

The Company has not provided financial or other support with respect to these investments other than its original investment.

1 unchanged sentence

The Company’s maximum exposure to loss on these investments is limited to the amount of the Company’s investment.

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Reverse Repurchase Agreements, Other Collateral Transactions and Restricted Investments

2 unchanged sentences

The maturity of these transactions is generally within one year.

The agreements require additional collateral to be transferred to the Company under specified conditions and the Company has the right to sell or re-pledge the securities

The agreements require additional collateral to be transferred to the Company under specified conditions and the Company has the right to sell or re-pledge the securities received.

The Company accounts for reverse repurchase agreements as collateralized financing.

As of September 30, 2023 and December 31, 2022, the Company reported $ 32 and $ 41 , respectively, within short-term investments on the Condensed Consolidated Balance Sheets representing a receivable for the amount of cash transferred to purchase the securities.

As of both March 31, 2024 and December 31, 2023, the Company reported $ 10 within short-term investments on the Condensed Consolidated Balance Sheets representing a receivable for the amount of cash transferred to purchase the securities.

Other Collateral Transactions

As of September 30, 2023 and December 31, 2022, the Company pledged collateral of $ 6 and $ 7 , respectively, of U.S.

As of March 31, 2024 and December 31, 2023, the Company pledged collateral of $ 6 and $ 7 , respectively, of U.S.

government securities or cash primarily related to certain bank loan participations committed through a limited partnership agreement.

7 unchanged sentences

The following table presents the components of the Company’s exposure to other restricted investments.

September 30, 2023 December 31, 2022

March 31, 2024 December 31, 2023

Fair Value Fair Value

10 unchanged sentences

Some of the Company's derivatives satisfy hedge accounting requirements as outlined in Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements, included in The Hartford’s 2023 Form 10-K Annual Report.

Typically, these hedging instruments include interest rate swaps and, to a lesser extent, foreign currency swaps where the terms or expected cash flows of the hedged

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

item closely match the terms of the swap.

The interest rate swaps are typically used to manage interest rate duration of certain fixed maturity securities or debt instruments issued.

Typically, these hedging instruments include interest rate swaps and, to a lesser extent, foreign currency swaps where the terms or expected cash flows of the hedged item closely match the terms of the swap.

Cash Flow Hedges

2 unchanged sentences

The Company has also entered into interest rate swaps to convert the variable interest payments on the $ 500 junior subordinated debentures due 2067 to fixed interest payments.

For further information, see the Junior Subordinated Debentures section within Note 13 - Debt of Notes to Condensed Consolidated Financial Statements and Note 13 - Debt of Notes to the Consolidated Financial Statements, included in The Hartford's 2022 Form 10-K Annual Report.

For further information, see the Junior Subordinated Debentures section within Note 14 - Debt of Notes to Consolidated Financial Statements, included in The Hartford's 2023 Form 10-K Annual Report.

Foreign currency swaps are used to convert foreign currency denominated cash flows related to certain investment receipts to U.S.

4 unchanged sentences

The non-qualifying strategies include:

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Credit Contracts

5 unchanged sentences

The Company uses interest rate swaps and futures to manage interest rate duration between assets and liabilities.

the Company enters into interest rate swaps to terminate existing swaps, thereby offsetting the changes in value of the original swap going forward.

As of September 30, 2023 and December 31, 2022, the notional amount of interest rate swaps in offsetting relationships was $ 6.6 billion for both periods.

In addition, the Company enters into interest rate swaps to terminate existing swaps, thereby offsetting the changes in value of the original swap going forward.

As of March 31, 2024 and December 31, 2023, the notional amount of interest rate swaps in offsetting relationships was $ 1.3 billion and $ 6.6 billion, respectively.

Foreign Currency Swaps and Forwards

2 unchanged sentences

The Company may enter into equity index options to hedge the impact of a decline in the equity markets on the investment portfolio.

The Company has also previously entered into covered call options on equity securities to generate additional return.

Commodity Options

The Company previously purchased call option contracts on oil futures in order to partially offset potential changes in value related to certain fixed maturity securities that could arise if oil prices increased substantially.

Derivative Balance Sheet Classification

4 unchanged sentences

Notional amounts are not necessarily reflective of credit risk.

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Derivative Balance Sheet Presentation

2 unchanged sentences

Notional Amount Fair Value Fair Value Fair Value

Hedge Designation/ Derivative Type Sep 30, 2023 Dec.

31, 2022 Sep 30, 2023 Dec.

Hedge Designation/ Derivative Type Mar 31, 2024 Dec.

31, 2023 Mar 31, 2024 Dec.

Cash flow hedges

8 unchanged sentences

Credit contracts

Credit derivatives that purchase credit protection 4,411 11 ( 59 ) — — — ( 59 ) —

Credit derivatives in offsetting positions 996 998 — — 31 27 ( 31 ) ( 27 )

6 unchanged sentences

Total derivatives $ 7,689 $ 12,363 $ 25 $ 7 $ 71 $ 57 $ ( 46 ) $ ( 50 )

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Offsetting of Derivative Assets/Liabilities

The following tables present the gross fair value amounts, the offsetting amounts, and net position of derivative instruments eligible for offset in the Company's Condensed Consolidated Balance Sheets.

Offsetting amounts include fair value amounts,

income accruals and related cash collateral receivables and payables associated with derivative instruments that are traded under a common master netting agreement, as described in the preceding discussion.

Offsetting amounts include fair value amounts, income accruals and related cash collateral receivables and payables associated with derivative instruments that are traded under a common master netting agreement, as described in the preceding discussion.

Also included in the tables are financial collateral receivables and payables, which are contractually permitted to be offset upon an event of default, although are disallowed for offsetting under U.S.

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Offsetting Derivative Assets and Liabilities

2 unchanged sentences

Gross Amounts of Recognized Assets (Liabilities) Gross Amounts Offset in the Statement of Financial Position Derivative Assets [1] (Liabilities) [2] Accrued Interest and Cash Collateral (Received) [3] Pledged [2] Financial Collateral (Received) Pledged [4] Net Amount

As of September 30, 2023

As of March 31, 2024

Other investments $ 71 $ 67 $ 47 $ ( 43 ) $ — $ 4

12 unchanged sentences

Gains (Losses) Recognized in OCI

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Interest rate swaps $ ( 17 ) $ 11

1 unchanged sentence

Total $ — $ 7

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Gains (Losses) Reclassified from AOCI into Income

Three months ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Net Investment Income Interest Expense Net Investment Income Interest Expense Net Investment Income Interest Expense Net Investment Income Interest Expense

Three Months Ended March 31,

Net Investment Income Interest Expense Net Investment Income Interest Expense

Interest rate swaps $ ( 7 ) $ 4 $ ( 8 ) $ 3

2 unchanged sentences

Total amounts presented on the Condensed Consolidated Statement of Operations $ 593 $ 50 $ 515 $ 50

As of September 30, 2023, the before tax deferred net losses on derivative instruments recorded in AOCI that are expected to be reclassified to earnings during the next twelve months are $ 2 .

As of March 31, 2024, the before tax deferred net losses on derivative instruments recorded in AOCI that are expected to be reclassified to earnings during the next twelve months are $ 13 .

This expectation is based on the anticipated interest payments on hedged investments in fixed maturity securities and long-term debt that will occur over the next twelve months.

At that time, the Company will recognize the deferred net gains (losses) as an adjustment to net investment income or interest expense,

as applicable, over the term of the hedged instrument cash flows.

During the three and nine months ended September 30, 2023 and 2022, the Company had no net reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges due to forecasted transactions that were no longer probable of occurring.

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

At that time, the Company will recognize the deferred net gains (losses) as an adjustment to net investment income or interest expense, as applicable, over the term of the hedged instrument cash flows.

During the three months ended March 31, 2024 and 2023, the Company had no net reclassifications from AOCI to earnings resulting from the discontinuance of cash-flow hedges due to forecasted transactions that were no longer probable of occurring.

Non-qualifying Strategies

For non-qualifying strategies, including embedded derivatives that are required to be bifurcated from their host contracts and

accounted for as derivatives, the gain or loss on the derivative is recognized currently in earnings within net realized gains (losses).

For non-qualifying strategies, including embedded derivatives that are required to be bifurcated from their host contracts and accounted for as derivatives, the gain or loss on the derivative is recognized currently in earnings within net realized gains (losses).

Non-Qualifying Strategies Recognized within Net Realized Gains (Losses)

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Foreign exchange contracts

Foreign currency forwards $ — $ — $ — $ 5

Three Months Ended March 31,

Interest rate contracts

Interest rate swaps, swaptions, and futures ( 71 ) ( 17 ) ( 53 ) 20

Interest rate swaps and futures $ 3 $ 21

Credit contracts

1 unchanged sentence

Equity contracts

Equity options — ( 2 ) — ( 2 )

Commodity contracts

Commodity options — — — 14

Equity index options ( 5 ) —

Total [1] $ ( 2 ) $ 5

[1]Excludes investments that contain an embedded credit derivative for which the Company has elected the fair value option.

For further discussion, see the Fair Value Option section in Note 4 - Fair Value Measurements of Notes to Condensed Consolidated Financial Statements.

For further discussion, see the Fair Value Option section in Note 4 - Fair Value Measuremen ts of Notes to Condensed Consolidated Financial Statements.

Credit Risk Assumed through Credit Derivatives

The Company enters into credit default swaps that assume credit risk of a single entity or referenced index in order to synthetically replicate investment transactions that are permissible under the Company's investment policies.

The Company will receive periodic payments based on an agreed upon rate and notional amount and will only make a payment if

there is a credit event.

The Company will receive periodic payments based on an agreed upon rate and notional amount and will only make a payment if there is a credit event.

A credit event payment will typically be equal to the notional value of the swap contract less the value of the referenced security issuer’s debt obligation after the occurrence of the credit event.

A credit event is generally defined as a default on contractually obligated interest or principal payments or bankruptcy of the referenced entity.

The credit default swaps in which the Company assumes credit risk reference baskets of standard diversified portfolios of CMBS issuers.

The credit default swaps in which the Company assumes credit risk may reference investment grade single corporate issuers and

baskets, which include standard diversified portfolios of corporate and CMBS issuers.

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Credit Risk Assumed Derivatives by Type

1 unchanged sentence

Obligation(s) [1]

As of September 30, 2023

As of March 31, 2024

Basket credit default swaps [4]

Investment grade risk exposure $ 101 $ ( 1 ) 4 years CMBS Credit AAA $ 101 $ 1

Below investment grade risk exposure 3 ( 2 ) Less than 1 year CMBS Credit B- 3 2

Below investment grade risk exposure 396 30 4 years Corporate Credit B+ $ 396 $ ( 30 )

Below investment grade risk exposure 1 ( 1 ) Less than 1 year CMBS Credit CCC- 1 1

Total [5] $ 498 $ 28 $ 498 $ ( 28 )

2 unchanged sentences

Investment grade risk exposure $ 101 $ ( 1 ) 5 years CMBS Credit AAA $ 101 $ 1

Below investment grade risk exposure 3 ( 2 ) Less than 1 year CMBS Credit B- 3 2

Below investment grade risk exposure 396 24 4 years Corporate Credit B+ 396 ( 24 )

Below investment grade risk exposure 2 ( 1 ) Less than 1 year CMBS Credit CCC- 2 1

Total [5] $ 499 $ 22 $ 499 $ ( 22 )

5 unchanged sentences

[3] The Company has entered into offsetting credit default swaps to terminate certain existing credit default swaps, thereby offsetting the future changes in value of, or losses paid related to, the original swap.

[4] Comprised of swaps of standard market indices of diversified portfolios of CMBS issuers referenced through credit default swaps.

[4] Comprised of swaps of standard market indices of diversified portfolios of corporate and CMBS issuers referenced through credit default swaps.

These swaps are subsequently valued based upon the observable standard market index.

[5] Excludes investments that contain an embedded credit derivative for which the Company has elected the fair value option.

For further discussion, see the Fair Value Option section in Note 4 - Fair Value Measurements of Notes to Condensed Consolidated Financial Statements.

For further discussion, see the Fair Value Option section in Note 4 - Fair Value Measuremen ts of Notes to Condensed Consolidated Financial Statements.

Derivative Collateral Arrangements

The Company enters into various collateral arrangements in connection with its derivative instruments, which require both the pledging and accepting of collateral.

As of September 30, 2023 and December 31, 2022, the Company ha s pl edged cash collateral associated with derivative instruments of $ 63 and less than $ 1 , respectively .

As of March 31, 2024 and December 31, 2023, the Company ha s pl edged cash collateral associated with derivative instruments of $ 30 and $ 25 , respectively .

In general, collateral receivable is recorded in other assets or other liabilities on the Company's Condensed Consolidated Balance Sheets as determined by the Company's election to offset on the balance sheet.

As of September 30, 2023 and December 31, 2022, the Company pledged securities collateral associated with derivative instruments with a fair value of $ 2 and $ 8 , respectively, which have been included in fixed maturities on the Company's Condensed Consolidated Balance Sheets.

As of March 31, 2024 and December 31, 2023, the Company pledged securities collateral associated with derivative instruments with a fair value of $ 5 and $ 14 , respectively, which have been included in fixed maturities on the Company's Condensed Consolidated Balance Sheets.

The counterparties generally have the right to sell or re-pledge these securities.

In addition, as of September 30, 2023 and December 31, 2022, the Company has pledged initial margin of cash related to OTC-cleared and exchange traded derivatives with a fair value of $ 16 for both periods, which is recorded in other investments or other assets on the Company's Condensed Consolidated Balance Sheets.

As of September 30, 2023 and December 31, 2022, the Company has pledged initial margin of securities related to OTC-cleared and exchange traded derivatives with a fair value of $ 217 and $ 57 , respectively, which are included within fixed maturities on the Company's Condensed Consolidated Balance Sheets.

As of September 30, 2023 and December 31, 2022, the Company accepted cash collateral associated with derivative instruments of $ 46 and $ 56 , respectively, which was invested and recorded in the Company's Condensed Consolidated Balance Sheets in fixed maturities and short-term investments with corresponding amounts recorded in other investments or other liabilities as determined by the Company's election to offset on the balance sheet.

The Company also accepted securities collateral as of September 30, 2023 and December 31, 2022, with a fair value of $ 0 and $ 1 , respectively, which the Company has the right to repledge or sell.

As of September 30, 2023 and December 31, 2022, the Company had no repledged securities.

In addition, as of September 30, 2023 and December 31, 2022, non-cash collateral accepted was held in separate custodial accounts and was not included in the Company’s Condensed Consolidated Balance Sheets .

In addition, as of March 31, 2024 and December 31, 2023, the Company has pledged initial margin of cash related to OTC-cleared and exchange traded derivatives with a fair value of $ 11 and $ 16 , respectively, which is recorded in other investments or other assets on the Company's Condensed Consolidated Balance Sheets.

As of March 31, 2024 and December 31, 2023, the Company has pledged initial margin of securities related to OTC-cleared and exchange traded derivatives with a fair value of $ 129 and $ 112 , respectively, which are included within fixed maturities on the Company's Condensed Consolidated Balance Sheets.

As of March 31, 2024 and December 31, 2023, the Company accepted cash collateral associated with derivative instruments of $ 62 and $ 49 , respectively, which was invested and recorded in the Company's Condensed Consolidated Balance Sheets in fixed maturities and short-term investments with corresponding amounts recorded in other investments or other liabilities as determined by the Company's election to offset on the balance sheet.

The Company also accepted securities collateral as of March 31, 2024 and December 31, 2023, with a fair value of $ 0 for both periods, which the Company has the right to repledge or sell.

As of March 31, 2024 and December 31, 2023, the Company had no repledged securities.

In addition, as of March 31, 2024 and December 31, 2023, non-cash collateral accepted was held in separate custodial accounts and was not included in the Company’s Condensed Consolidated Balance Sheets .

Note 7 - Premiums Receivable and Agents' Balances

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

PREMIUMS RECEIVABLE AND AGENTS' BALANCES

Premiums Receivable and Agents' Balances

As of September 30, 2023 As of December 31, 2022

As of March 31, 2024 As of December 31, 2023

Premiums receivable, excluding receivables for losses within a deductible and retrospectively-rated policy premiums ("loss sensitive business") $ 5,676 $ 5,303

11 unchanged sentences

A portion of the Company's Commercial Lines business is written with large deductibles or under retrospectively-rated plans (referred to as "loss sensitive business").

Under some commercial insurance contracts with a large deductible, the

Company is obligated to pay the claimant the full amount of the claim and the Company is subsequently reimbursed by the policyholder for the deductible amount.

Under some commercial insurance contracts with a large deductible, the Company is obligated to pay the claimant the full amount of the claim and the Company is subsequently reimbursed by the policyholder for the deductible amount.

As such, the Company is subject to credit risk until reimbursement is made.

12 unchanged sentences

See Note 5 - Investments

The increase in the ACL in the nine months ended September 30, 2023 reflected the provision required on increased premiums written in the quarter and recoveries, partially offset by write-offs.

Rollforward of ACL on Premiums Receivable and Agents' Balances for the Three Months Ended

September 30, 2023 September 30, 2022

Premiums Receivable and Agents' Balances, Excluding Receivables for Loss Sensitive Business Receivables for Loss Sensitive Business Total Premiums Receivable and Agents' Balances, Excluding Receivables for Loss Sensitive Business Receivables for Loss Sensitive Business Total

March 31, 2024 March 31, 2023

Receivables Excluding Receivables for Loss Sensitive Business Receivables for Loss Sensitive Business Total Receivables Excluding Receivables for Loss Sensitive Business Receivables for Loss Sensitive Business Total

Beginning ACL $ 89 $ 20 $ 109 $ 85 $ 24 $ 109

Current period provision (release) 11 1 12 12 1 13

Current period provision 15 — 15 12 1 13

Current period write-offs ( 15 ) — ( 15 ) ( 14 ) — ( 14 )

1 unchanged sentence

Ending ACL $ 91 $ 20 $ 111 $ 86 $ 25 $ 111

Note 7 - Premiums Receivable and Agents' Balances

Note 8 - Reinsurance

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Rollforward of ACL on Premiums Receivable and Agents' Balances for the Nine Months Ended

September 30, 2023 September 30, 2022

Beginning ACL

$ 85 $ 24 $ 109 $ 83 $ 22 $ 105

Current period provision (release) 42 2 44 35 2 37

Current period write-offs ( 41 ) ( 1 ) ( 42 ) ( 41 ) ( 1 ) ( 42 )

Current period recoveries 6 — 6 8 — 8

$ 92 $ 25 $ 117 $ 85 $ 23 $ 108

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company cedes insurance risk to reinsurers to enable the Company to manage capital and risk exposure.

6 unchanged sentences

expense reserves that may be ceded under the terms of the reinsurance agreements, including incurred but not reported (" IBNR ") unpaid losses.

The Company’s estimate of losses and loss adjustment expense reserves ceded to reinsurers is based on assumptions that are consistent with those used in establishing the gross reserves for amounts the Company owes to its claimants.

The Company’s estimate of losses and loss adjustment expense ("LAE") reserves ceded to reinsurers is based on assumptions that are consistent with those used in establishing the gross reserves for amounts the Company owes to its claimants.

The Company estimates its ceded reinsurance recoverables based on the terms of any applicable facultative and treaty reinsurance, including an estimate of how incurred but not reported losses will ultimately be ceded under reinsurance agreements.

1 unchanged sentence

Reinsurance Recoverables by Credit Quality Indicator

As of September 30, 2023 As of December 31, 2022

As of March 31, 2024 As of December 31, 2023

Group Benefits

21 unchanged sentences

Balances are considered past due when amounts that have been billed are not collected within contractually stipulated time periods, generally 30, 60 or 90 days.

To manage reinsurer credit risk, a reinsurance security review committee evaluates the

credit standing, financial performance, management and operational quality of each potential reinsurer.

In placing reinsurance, the Company considers the nature of the risk

Note 8 - Reinsurance

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

reinsured, including the expected liability payout duration, and establishes limits tiered by reinsurer credit rating.

To manage reinsurer credit risk, a reinsurance security review committee evaluates the credit standing, financial performance, management and operational quality of each potential reinsurer.

In placing reinsurance, the Company considers the nature of the risk reinsured, including the expected liability payout duration, and establishes limits tiered by reinsurer credit rating.

Where its contracts permit, the Company secures future claim obligations with various forms of collateral or other credit enhancement, including irrevocable letters of credit, secured trusts, funds held accounts and group wide offsets.

6 unchanged sentences

The probability of default factors are historical insurer and reinsurer defaults for liabilities with similar durations to the reinsured liabilities as estimated

Note 8 - Reinsurance

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

through multiple economic cycles.

3 unchanged sentences

Reinsurance recoverables due from pools are backed by the financial position of all insurance companies participating in the pools and the credit backing the reinsurance recoverable is not limited to the financial strength of each pool.

The mandatory pools generally are funded through policy assessments or surcharges and if any participant in the pool defaults, remaining liabilities are apportioned among the other members.

The mandatory pools generally are funded through policy assessments or

surcharges and if any participant in the pool defaults, remaining liabilities are apportioned among the other members.

The Company's evaluation of the required ACL for reinsurance recoverables considers the current economic environment as well as macroeconomic scenarios similar to the approach used to estimate the ACL for mortgage loans.

3 unchanged sentences

As a result, there is limited history of losses from insurer defaults.

Allowance for Uncollectible Reinsurance for the Three and Nine Months Ended

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Allowance for Uncollectible Reinsurance for the Three Months Ended

Three Months Ended March 31,

P&C beginning allowance for uncollectible reinsurance $ 100 $ 102

1 unchanged sentence

P&C beginning ACL 43 42

Current period provision (release) 1 1 4 —

Current period provision 1 2

P&C ending ACL 44 44

6 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

RESERVE FOR UNPAID LOSSES AND LOSS ADJUSTMENT EXPENSES

1 unchanged sentence

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses

For the nine months ended September 30,

For the three months ended March 31,

Beginning liabilities for unpaid losses and loss adjustment expenses, gross

7 unchanged sentences

Total provision for unpaid losses and loss adjustment expenses

Change in deferred gain on retroactive reinsurance included in other liabilities [1] 24 —

Current accident year ( 349 ) ( 321 )

8 unchanged sentences

$ 34,537 $ 33,398

[1] Prior accident year development for the three months ended March 31, 2024 includes a $ 24 benefit for amortization of a deferred gain under retroactive reinsurance accounting related to the Navigators Adverse Development Cover ("ADC") as the Company began collection recoveries of the ceded losses from National Indemnity Company ("NICO"), a subsidiary of Berkshire Hathaway Inc, during the period.

For additional information regarding the ADC reinsurance agreement, refer to "Change in Deferred Gain on Retroactive Reinsurance" discussion below.

Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Unfavorable (Favorable) Prior Accident Year Development

For the nine months ended September 30,

For the three months ended March 31,

Workers’ compensation $ ( 67 ) $ ( 61 )

1 unchanged sentence

General liability 17 12

Marine ( 1 ) 2

Package business — ( 5 )

1 unchanged sentence

Professional liability ( 5 ) —

Bond 12 ( 4 )

Assumed reinsurance 9 2

6 unchanged sentences

Other reserve re-estimates, net ( 2 ) 28

Prior accident year development before change in deferred gain ( 32 ) —

Change in deferred gain on retroactive reinsurance included in other liabilities [1] ( 24 ) —

Total prior accident year development $ ( 56 ) $ —

Re-estimates of prior accident year reserves for the nine months ended September 30, 2023

[1] The $ 24 change in deferred gain on retroactive reinsurance for the three months ended March 31, 2024, is related to amortization of the Navigators ADC deferred gain.

For additional information regarding the ADC reinsurance agreement, refer to "Change in Deferred Gain on Retroactive Reinsurance" discussion below.

Re-estimates of prior accident year reserves for the three months ended March 31, 2024

Workers’ compensation reserves were decreased within the 2016 to 2020 accident years primarily in small commercial, driven by lower than previously estimated claim severity.

In addition, the 2020 accident year includes a $ 20 reduction of COVID-19 related reserves driven by favorable claim count emergence.

General liability reserves were increased within the 2016 to 2019 accident years driven by higher frequency of large losses on individual claims of excess and umbrella coverages within middle & large commercial and deterioration in global specialty primary construction business.

Marine reserves increased related to higher frequency of large losses on individual U.S.

cargo claims for the 2023 accident year.

Professional liability reserves decreased modestly due to favorable development on directors' and officers' ("D&O") claims driven by the 2020 accident year.

Assumed reinsurance reserves were increased due to higher reserve estimates in the Latin America surety business related to the 2021 to 2023 accident years.

Other reserve re-estimates, net, were decreased due to lower severity than expected on Personal Lines automobile physical damage for accident year 2023, partially offset by unfavorable development from participation in involuntary market pools.

Re-estimates of prior accident year reserves for the three months ended March 31, 2023

Workers’ compensation reserves were decreased within the 2014 to 2019 accident years primarily in small commercial, driven by lower than previously estimated claim severity.

In addition, the 2020 accident year reflects a $ 20 reduction of COVID-19 related reserves.

General liability reserves were increased driven by higher frequency and estimated cost to settle large individual claims for the 2016 to 2019 accident years, partially offset by a decrease in reserves for the 2020 accident year due to favorable experience.

In addition, reserves for sexual molestation and sexual abuse claims were increased for older accident years.

Also included was a decrease in reserves for extra contractual liability claims and other miscellaneous run-off lines.

Package business reserves decreased primarily due to lower than previously estimated property severity for accident year 2019 and 2021.

Package liability is flat overall with reserve increases related to higher severity across multiple accident years offset by improvement in accident year 2020 due to favorable claim count emergence.

Commercial property reserves were flat primarily due to unfavorable development for accident year 2022 in middle & large commercial, offset by favorable development in global specialty.

Professional liability reserves decreased modestly due to favorable development on directors' and officers' claims for the 2019 to 2021 accident years partially offset by deterioration

on errors and omissions claims primarily for the 2018 accident year.

Bond reserves were increased primarily due to unfavorable development for 2013 and prior accident years related to customs bonds.

Assumed reinsurance reserves were increased due to higher reserve estimates in the specialty casualty, Latin America casualty and surety business.

Automobile liability reserves - Commercial Lines increased primarily due to adverse loss development within accident years 2017 to 2019.

Automobile liability reserves - Personal Lines were flat as increases for accident year 2022 from higher estimated severity and increasing attorney representation rates were fully offset by decreases, primarily within accident years 2019 to 2021, due to lower estimated severity.

Catastrophes reserves were decreased primarily within Commercial Lines driven by a reduction in reserves in accident year 2022 for Hurricane Ian and accident year 2021 for Hurricane Ida.

Uncollectible reinsurance was increased primarily in Commercial Lines related to a captive reinsurer and, to a lesser extent, an increase in reserves for potential collection disputes and credit concerns.

General liability reserves were increased in middle & large commercial, driven by an increase in the frequency and estimated cost to settle large individual claims for the 2016 to 2021 accident years.

Package business reserves decreased primarily due to lower than previously estimated property severity for accident year 2021.

Package liability is flat overall with improvement in accident year 2020 due to favorable claim count emergence offset by reserve increases in accident years 2019 and prior related to higher severity.

Commercial property reserves were increased due to unfavorable development for accident year 2022 in middle & large commercial.

Automobile liability reserves - Personal Lines were flat as decreases due to lower estimated severity, within accident years 2019 to 2021 were offset by increases in accident year 2022 due to higher estimated severity and increasing attorney representation rates.

Uncollectible reinsurance was increased primarily in Commercial Lines related to a captive reinsurer, and to a lesser extent in P&C Other Operations related to one larger reinsurer entering liquidation proceedings.

Other reserve re-estimates, net, were increased primarily due to an increase in accident year 2022 Personal Lines automobile physical damage severity.

Re-estimates of prior accident year reserves for the nine months ended September 30, 2022

Workers’ compensation reserves were decreased for the 2014 through 2018 accident years, predominately within small commercial, driven by lower than previously estimated claim severity, and, to a lesser extent, a $ 14 reduction of COVID-19 related claims from 2020.

General liability reserves were increased, driven by an increase in the estimated cost to settle large individual claims in middle & large commercial for the 2016 to 2019 accident years, an increase in excess casualty for the 2019 accident year, and increases in primary construction on older accident years, partially offset by a decrease in reserves for other mass torts.

Package business reserves decreased due to lower estimated severity and lower estimated loss adjustment expenses for accident years 2013 to 2018 and a reduction in property reserves for the 2020 and 2021 accident years.

Commercial property reserves were decreased primarily due to favorable development for the 2020 accident year in middle & large commercial related to COVID-19 claims and a reduction in property reserves for the 2021 accident year.

Professional liability reserves were decreased primarily due to favorable development on directors’ and officers’ claims for the 2018 to 2020 accident years and on errors and omissions claims for the 2013 to 2017 accident years, partially offset by large losses related to 2018 and prior accident years for primary and excess directors’ and officers’ claims.

Change in Deferred Gain on Retroactive Reinsurance

The Company has in place an ADC reinsurance agreement that covers substantially all reserve development of Navigators Insurance Company and certain of its affiliates for 2018 and prior accident years (the “Navigators ADC”) up to an aggregate limit of $ 300 , for which the Company had previously ceded the available limit.

As of December 31, 2023, the Company had paid claims related to the Navigators ADC in excess of the $ 1.816 billion acquisition date reserves plus the $ 100 retention.

During the three months ended March 31, 2024, the Company began collecting recoveries from NICO and as a result amortized $ 24 of the deferred gain within benefits, losses and loss adjustment expenses in the Condensed Consolidated Statements of Operations.

As of March 31, 2024 and December

Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Assumed reinsurance reserves were increased primarily due to higher reserve estimates for syndicate property claims, including higher expected COVID-19 property losses in the 2020 accident year and increased reserves for international agriculture related to drought claims.

Automobile liability reserves were decreased in Personal Lines principally due to lower estimated severity on AARP Direct claims, primarily within accident years 2015 to 2020 and were increased in Commercial Lines principally due to a higher number of large claims in accident years 2017 to 2019.

Catastrophe reserves were decreased in both Commercial and Personal Lines with the largest reduction related to 2019 and 2020 wind and hail events.

Other reserve re-estimates, net, were increased primarily due to an increase in automobile physical damage severity and unfavorable development from participation in involuntary market pools.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

31, 2023, the deferred gain on the Navigators ADC was $ 185 and $ 209 , respectively, and is included in other liabilities on the Condensed Consolidated Balance Sheets.

Settlement Agreement with Boy Scouts of America

On February 14, 2022, the Company executed a final settlement agreement (the “Settlement”) with the Boy Scouts of America (“BSA”), the Local Councils, and the attorneys representing a majority of the alleged victims, pursuant to which The Hartford agreed to pay $ 787 for sexual molestation and sexual abuse claims associated with liability policies issued by various Hartford Writing Companies in the 1970s and early 1980s.

Hartford Writing Companies in the 1970s and early 1980s.

In exchange for its payment, the Company receives a complete release of its policies issued to BSA and the Local Councils, as well as an injunction against further abuse claims involving BSA.

4 unchanged sentences

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses

For the nine months ended September 30,

For the three months ended March 31,

Beginning liabilities for unpaid losses and loss adjustment expenses, gross $ 8,274 $ 8,160

13 unchanged sentences

[1] Prior incurral year development represents the change in estimated ultimate incurred losses and loss adjustment expenses for prior incurral years on a discounted basis.

[2] Includes unallocated loss adjustment expenses ("ULAE") of $ 136 and $ 138 for the nine months ended September 30, 2023 and 2022, respectively, that are recorded in insurance operating costs and other expenses in the Condensed Consolidated Statements of Operations .

Re-estimates of prior incurral years reserves for the nine months ended September 30, 2023

[2] Includes unallocated loss adjustment expenses ("ULAE") of $ 45 and $ 45 for the three months ended March 31, 2024 and 2023, respectively, that are recorded in insurance operating costs and other expenses in the Condensed Consolidated Statements of Operations .

Re-estimates of prior incurral years reserves for the three months ended March 31, 2024

Group disability- Prior period reserve estimates decreased by approximately $ 149 largely driven by group long-term disability claim incidence lower than prior assumptions and strong recoveries on prior incurral year claims.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $ 25 largely driven by continued low incidence in group life premium waiver.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $ 37 largely driven by favorable mortality emergence and continued low incidence in group life premium waiver.

Supplemental accident and health- Prior period reserve estimates decreased by approximately $ 3 driven by lower than previously expected claim incidence.

Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Re-estimates of prior incurral years reserves for the nine months ended September 30, 2022

Group disability- Prior period reserve estimates decreased by approximately $ 275 largely driven by group long-term disability claim incidence lower than prior assumptions, strong recoveries on prior incurral year claims and higher estimated claim termination rates.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $ 40 largely driven by continued low incidence in group life premium waiver as well as a reduction in estimated mortality group term life losses incurred in fourth quarter 2021.

Re-estimates of prior incurral years reserves for the three months ended March 31, 2023

Group disability- Prior period reserve estimates decreased by approximately $ 120 largely driven by group long-term disability claim incidence lower than prior assumptions and strong recoveries on prior incurral year claims.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $ 8 largely driven by continued low incidence in group life premium waiver.

Supplemental Accident & Health- Prior period reserve estimates decreased by approximately $ 5 driven by lower than previously expected claim incidence.

Note 10 - Reserve for Future Policy Benefits

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

RESERVE FOR FUTURE POLICY BENEFITS

Rollforward of Reserve for Future Policy Benefits

For the nine months ended September 30,

For the three months ended March 31,

Payout Annuities Life Conversions Paid-up Life Payout Annuities Life Conversions Paid-up Life

17 unchanged sentences

Net Reserve for Future Policy Benefits

As of September 30,

As of March 31,

Payout Annuities $ 135 $ 143

5 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Undiscounted Expected Future Gross Premiums and Benefit Payments

As of September 30,

As of March 31,

Payout Annuities [1]

7 unchanged sentences

Weighted-Average Interest Rates

As of September 30,

As of March 31,

Payout Annuities

6 unchanged sentences

Current discount rate 5.2 % 5.0 %

The Company completed a review of cash flow assumptions in the third quarter 2023, resulting in immaterial changes to the reserve for future policy benefits.

For payout annuities, the net effect of updating cash flow assumptions was partially offset by a corresponding impact to the deferred profit liability.

Gross premiums and interest accretion recognized on long-duration insurance policies for the nine months ended September 30, 2023 and 2022 were immaterial.

Gross premiums and interest accretion recognized on long-duration insurance policies for the three months ended March 31, 2024 and 2023 were immaterial.

OTHER POLICYHOLDER FUNDS AND BENEFITS PAYABLE

Other policyholder funds and benefits payable of $ 645 and $ 659 as of September 30, 2023 and 2022 respectively, included universal life long-duration contacts of $ 226 and $ 236 as well as policyholder balances related to short-duration contracts of $ 419 and $ 423 .

Other policyholder funds and benefits payable of $ 633 and $ 647 as of March 31, 2024 and 2023 respectively, included universal life long-duration contacts of $ 218 and $ 231 as well as policyholder balances related to short-duration contracts of $ 415

The universal life long-duration contacts presented in the table below were economically ceded to Prudential as part of the sale of the Company's former individual life business, which closed in 2013.

Universal Life Long Duration Contracts Rollforward

For the nine months ended September 30,

For the three months ended March 31,

Balance, beginning of the period $ 223 $ 232

9 unchanged sentences

[1]Net amount at risk is defined as the current death benefit in excess of the current account value as of the balance sheet date.

As of September 30, 2023 and 2022, universal life contracts of $ 225 and $ 234 , respectively, had crediting rates at their guaranteed minimums ranging from 4 %- 5 % .

As of March 31, 2024 and 2023, universal life contracts of $ 217 and $ 229 , respectively, had crediting rates at their guaranteed minimums ranging from 4 %- 5 % .

Note 12 - Income Taxes

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Income Tax Expense

Income Tax Rate Reconciliation

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Tax provision at U.S.

1 unchanged sentence

Nontaxable investment income ( 11 ) ( 11 )

Other 3 7 ( 12 ) ( 1 )

Decrease in deferred tax valuation allowance ( 12 ) ( 3 )

Stock-based compensation, net ( 16 ) ( 9 )

Provision for income taxes $ 158 $ 118

1 unchanged sentence

Rollforward of Unrecognized Tax Benefits

Three Months Ended September 30,

Nine Months Ended September 30,

2023 2022 2023 2022

Three Months Ended March 31,

Balance, beginning of period $ 26 $ 22

Gross increases - tax positions in current period 1 1

Lapse of statute of limitations — — ( 1 ) —

Balance, end of period $ 27 $ 23

The entire amount of unrecognized tax benefits, if recognized, would affect the effective tax rate in the period of the release.

The Company believes it is reasonably possible approximately

$ 4 of its currently unrecognized tax benefits associated with R&D credits claimed on the Company's 2020 tax return may be recognized by the end of 2024 as a result of a lapse in the applicable statute of limitations.

Other Tax Matters

As of September 30, 2023, the Company has a deferred tax asset for foreign net operating losses ("NOLs") of $ 42 partially offset by a valuation allowance of $ 20 .

While the foreign NOLs do not expire, this assessment reflects uncertainty in the Company's ability to generate sufficient taxable income in the near term in those specific jurisdictions.

Management has assessed the need for a valuation allowance against its deferred tax assets based on tax character and jurisdiction.

Management has assessed the need for a valuation allowance against its deferred tax assets based on tax character and jurisdiction, and as part of this assessment, the Company reduced the valuation allowance related to the deferred tax asset for foreign net operating losses from $ 12 as of December 31, 2023 to $ 0 as of March 31, 2024.

In making the assessment, management considered future taxable temporary difference reversals, future taxable income exclusive of reversing temporary differences and carryovers, taxable income in open carry back years and other tax planning strategies which management views as prudent and feasible.

1 unchanged sentence

The acquired Navigators Group is currently under IRS audit for the pre-acquisition 2019 tax period.

The statute of limitations is closed through the 2019 tax year with the exception of NOL carryforwards utilized in open tax years and the Navigators pre-acquisition 2019 tax period.

The statute of limitations is closed through the 2019 tax year with the exception of net operating loss carryforwards utilized in open tax years and the Navigators pre-acquisition 2019 tax period.

Management believes that adequate provision has been made in the Company's Condensed Consolidated Financial Statements for any potential adjustments that may result from tax examinations and other tax-related matters for all open tax years.

Junior Subordinated Debentures

Financial Conduct Authority ("FCA") ceased publication of U.S.

dollar London Interbank Offered Rate ("LIBOR") on a representative basis immediately after June 30, 2023.

LIBOR was used as a benchmark or reference rate for certain investments and derivatives the Company owns, and floating rate debt the Company has issued.

Uncertainties and risks relating to the transition from LIBOR have been reduced by the federal Adjustable Interest Rate (LIBOR) Act, which addresses replacement of LIBOR in certain contracts governed by U.S.

law (including the law of any U.S.

state), including 3-Month LIBOR, which was the original reference rate on the Company's $ 500 junior subordinated debentures due 2067.

Prior to July 1, 2023, the Company's $ 500 junior subordinated debentures due 2067 paid interest at a rate of LIBOR plus 2.125 %.

Effective July 1, 2023, the interest rate on the $ 500 junior subordinated debentures due 2067 is determined based on a reference rate of 3-month Chicago Mercantile Exchange ("CME") term Secured Overnight Financing Rate (“SOFR”) plus a spread adjustment of 0.26161 % plus 2.125 %.

The Company's interest rate swap agreements that converted the LIBOR variable interest payments on the $ 500 junior subordinated debentures to fixed interest payments were terminated and new interest rate swap agreements were entered into that reference SOFR so that interest rate swaps continue to effectively convert the variable interest payments to fixed interest payments of approximately 4.39 %.

COMMITMENTS AND CONTINGENCIES

2 unchanged sentences

Management establishes liabilities for these contingencies at its “best estimate,” or, if no one number within the range of possible losses is more probable than any other, the Company records an estimated liability at the low end of the range of losses.

The Hartford is involved in claims litigation arising in the ordinary course of business, both as a liability insurer defending or providing indemnity for third-party claims brought against insureds and as an insurer defending coverage claims brought

Note 14 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Hartford accounts for such activity through the establishment of unpaid loss and loss adjustment expense reserves.

Subject to the uncertainties related to sexual molestation and sexual abuse claims discussed in Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of this Form 10-Q and in Note 11 - Reserve for Unpaid Losses and Loss Adjustment Expenses, of the Company's Annual Report on Form 10-K for the year ended December 31, 2022, and in the following discussion under the caption “COVID-19 Pandemic Business Income Insurance Litigation” and under the caption “Run-off Asbestos and Environmental Claims,” management expects that the ultimate liability, if any, with respect to such ordinary-course claims litigation, after consideration of provisions made for potential losses and costs of defense, will not be material to the consolidated financial condition, results of operations or cash flows of The Hartford.

Subject to the uncertainties related to sexual molestation and sexual abuse claims, including those discussed in Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of this Form 10-Q and in Note 11 - Reserve for Unpaid Losses and Loss Adjustment Expenses, of the Company's Annual Report on Form 10-K for the year ended December 31, 2023, and in the following discussion under the caption “COVID-19 Pandemic Business Income Insurance Litigation” and under the caption “Run-off Asbestos and Environmental Claims,” management expects that the ultimate liability, if any, with respect to such ordinary-course claims

litigation, after consideration of provisions made for potential losses and costs of defense, will not be material to the consolidated financial condition, results of operations or cash flows of The Hartford.

The Hartford is also involved in other kinds of legal actions, some of which assert claims for substantial amounts.

2 unchanged sentences

The Hartford also is involved in individual actions in which punitive damages are sought, such as claims alleging bad faith in the handling of insurance claims or other allegedly unfair or improper business practices.

Like many other insurers, The Hartford also has been joined in actions by asbestos plaintiffs asserting, among other things, that insurers had a duty to protect the public from the dangers of asbestos and that insurers committed unfair trade practices by asserting defenses on behalf of their policyholders in the underlying asbestos cases.

Management expects that the ultimate liability, if any, with respect to such lawsuits, after consideration of provisions made for estimated losses, will not be material to the consolidated financial condition of The Hartford.

Nonetheless, given the large or indeterminate amounts sought in certain of these actions, and the inherent unpredictability of litigation, the outcome in certain matters could, from time to time, have a material adverse effect on the Company’s results of operations or cash flows in particular quarterly or annual periods.

Note 13 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

COVID-19 Pandemic Business Income Insurance Litigation

Like many others in the property and casualty insurance industry, beginning in April 2020, various direct and indirect subsidiaries of the Company (collectively the "Hartford Writing Companies”), and in some instances the Company itself, have been served as defendants in lawsuits seeking insurance coverage under commercial insurance policies issued by the Hartford Writing Companies for alleged losses resulting from the shutdown or suspension of their businesses due to the spread of COVID-19.

More than 300 such lawsuits have been filed, of which more than 60 purport to be filed on behalf of broad nationwide or statewide classes of policyholders.

These lawsuits have been filed in state and federal courts in roughly 35 states.

Like many others in the property and casualty insurance industry, beginning in April 2020, various direct and indirect subsidiaries of the Company (collectively the "Hartford Writing Companies”), and in some instances the Company itself, were named as defendants in lawsuits seeking insurance coverage under commercial insurance policies issued by the Hartford Writing Companies for alleged losses resulting from the shutdown or suspension of their businesses due to the spread of COVID-19.

More than 300 such lawsuits were filed, including numerous lawsuits purportedly filed on behalf of broad nationwide or statewide classes of policyholders.

Although the allegations vary, the plaintiffs generally seek a declaration of insurance coverage, damages for breach of contract in unspecified amounts, interest, and attorneys' fees.

Many of the lawsuits also allege that the insurance claims were denied in bad faith or otherwise in violation of state laws and

seek extra-contractual or punitive damages.

Many of the lawsuits also allege that the insurance claims were denied in bad faith or otherwise in violation of state laws and seek extra-contractual or punitive damages.

Some of the lawsuits also allege that the Hartford Writing Companies engaged in unfair business practices by collecting or retaining excess premium.

The Company and its subsidiaries deny the allegations and continue to vigorously defend these suits.

The Hartford Writing Companies maintain that they have no coverage obligations with respect to these suits for business income allegedly lost by the plaintiffs due to the COVID-19 pandemic based on the clear terms of the applicable insurance policies.

Although the policy terms vary depending, among other things, upon the size, nature, and location of the policyholder’s business, in general, the claims at issue in these lawsuits were denied because the claimant identified no direct physical damage or loss to property at the insured premises, and the governmental orders that led to the complete or partial shutdown of the business were not due to the existence of any direct physical damage or loss in the immediate vicinity of the insured premises and did not prohibit access to the insured premises, as required by the terms of the insurance policies.

In addition, the vast majority of the policies at issue expressly exclude from coverage any loss caused directly or indirectly by the presence, growth, proliferation, spread or activity of a virus, subject to a narrow set of exceptions not applicable in connection with this pandemic, and contain a pollution and contamination exclusion that, among other things, expressly excludes from coverage any loss caused by material that threatens human health or welfare.

In addition to the inherent difficulty in predicting litigation outcomes, the COVID-19 pandemic business income coverage lawsuits present numerous uncertainties and contingencies that are not yet fully known, including how many additional claims or lawsuits could be filed, the extent to which any state or nationwide classes will be certified, and the size and scope of any such classes.

The legal theories advocated by plaintiffs vary significantly by case as do the state laws that govern the policy interpretation.

These lawsuits are at various stages of litigation:

some are in the earliest stages of litigation, some complaints may be amended, some have been dismissed voluntarily and may be refiled, while many have been dismissed through rulings in favor of the Hartford Writing Companies.

Discovery is underway in certain single plaintiff cases.

Moreover, dozens of policyholders have appealed dismissals in favor of the Hartford Writing Companies.

The Hartford Writing Companies have received numerous favorable rulings on appeal, with a few adverse appellate rulings to date.

The remainder of the Hartford Writing Companies' appeals are at various stages of the appellate process and have not yet been ruled upon.

In addition, business income calculations depend upon a wide range of factors that are particular to the circumstances of each individual policyholder and, here, almost none of the plaintiffs have submitted proofs of loss or otherwise quantified or factually supported any allegedly covered loss, and, in any event, the Company’s experience shows that demands for damages often bear little relation to a reasonable estimate of potential loss.

Accordingly, management cannot now reasonably estimate the possible loss or range of loss, if any.

Nonetheless, given the large number of claims and potential claims, the indeterminate amounts sought, and the inherent unpredictability of litigation, it is possible that adverse outcomes, if any, in the aggregate, could have a material adverse effect on the Company’s consolidated operating results or liquidity.

Note 14 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

The Company and its subsidiaries deny the allegations and maintain that based on the terms of the applicable insurance policies, they have no coverage obligations with respect to these suits for business income allegedly lost by the plaintiffs due to the COVID-19 pandemic.

Specifically, the policies generally require direct physical loss or damage to insured property and/or contain exclusions for any loss caused directly or indirectly by the presence, growth, proliferation, spread or activity of a virus, subject to a narrow set of exceptions not applicable in connection with this pandemic, and which often contain a pollution and contamination exclusion that, among other things, expressly excludes from coverage any loss caused by material that threatens human health or welfare.

The Company has obtained numerous dismissals in its favor and affirmations on appeal and continues to vigorously defend the remaining suits in the trial and appellate courts.

Nevertheless, given the inherent difficulty in predicting litigation outcomes, the COVID-19 pandemic business income coverage lawsuits still present uncertainties and contingencies that are not yet fully known, including whether additional claims or lawsuits could be filed, the extent to which any state or nationwide classes will be certified, and the size and scope of any such classes.

In addition, business income calculations depend upon a wide range of factors that are particular to the circumstances of each individual policyholder and, here, almost none of the plaintiffs have submitted proofs of loss or otherwise quantified or factually supported any allegedly covered loss to allow management to reasonably estimate the possible loss or range of loss, if any.

Thus, despite the high percentage of favorable outcomes to date in both the trial and appellate courts, given the lack of certainty around the remaining lawsuits, the indeterminate amounts sought, and the inherent unpredictability of litigation, it is possible that adverse outcomes, if any, in the aggregate, could have a material adverse effect on the Company’s consolidated operating results or liquidity.

Run-off Asbestos and Environmental Claims

17 unchanged sentences

In the case of the reserves for environmental exposures, factors contributing to the high degree of uncertainty include expanding theories of liability and damages against insureds, emerging risks such as per-and polyfluoroalkyl substances ("PFAS"), the risks inherent in major litigation, inconsistent and emerging legal doctrines concerning the existence and scope of coverage for

Note 13 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

environmental claims, and the scope and level of complexity of the remediation required by regulators.

8 unchanged sentences

The ultimate liabilities, thus, could exceed the currently recorded reserves, and any such additional liability, while not estimable now, could be material to The Hartford’s consolidated operating results or liquidity.

For its Run-off A&E claims, as of September 30, 2023, the Company reported $ 292 of net A&E reserves, including the benefit of losses ceded to an A&E adverse development cover ("ADC") with National Indemnity Company, a subsidiary of Berkshire Hathaway ("NICO") (collectively the "A&E ADC").

For its Run-off A&E claims, as of March 31, 2024, the Company reported $ 216 of net A&E reserves, including the benefit of losses ceded to an A&E ADC with NICO (collectively the "A&E ADC").

In addition, the Company has recorded a $ 788 deferred gain within other liabilities for losses economically ceded to NICO but for which the benefit is not recognized in earnings until later periods.

1 unchanged sentence

The ultimate liabilities, thus, could exceed the currently recorded reserves, and any such additional liability, while not reasonably estimable now, could be material to The Hartford's consolidated operating results or liquidity.

The Company’s A&E ADC reinsurance agreement reinsures substantially all A&E reserve development for 2016 and prior accident years, including Run-off A&E and A&E reserves included in Commercial Lines and Personal Lines.

The Company’s A&E ADC reinsurance agreement reinsures substantially all A&E reserve development for 2016 and prior

accident years, including Run-off A&E and A&E reserves included in Commercial Lines and Personal Lines.

The A&E ADC has a coverage limit of $ 1.5 billion above the Company’s existing net A&E reserves as of December 31, 2016 of approximately $ 1.7 billion.

As of September 30, 2023 , the Company has incurred $ 1,244 in cumulative adverse development on A&E reserves that have been ceded under the A&E ADC treaty, leaving $ 256 of coverage available for future adverse net reserve development, if any.

Cumulative adverse development of A&E claims for accident years 2016 and prior

Note 14 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

could ultimately exceed the $ 1.5 billion treaty limit in which case any adverse development in excess of the treaty limit would be absorbed as a charge to earnings by the Company.

As of March 31, 2024 , the Company has incurred $ 1,438 in cumulative adverse development on A&E reserves that have been ceded under the A&E ADC treaty, leaving $ 62 of coverage available for future adverse net reserve development, if any.

Cumulative adverse development of A&E claims for accident years 2016 and prior could ultimately exceed the $ 1.5 billion treaty limit in which case any adverse development in excess of the treaty limit would be absorbed as a charge to earnings by the Company.

In these scenarios, the effect of these charges could be material to the Company’s consolidated operating results or liquidity.

5 unchanged sentences

If the termination rights were to be exercised by the counterparties, it could impact the legal entity’s ability to conduct hedging activities by increasing the associated costs and decreasing the willingness of counterparties to transact with the legal entity.

The aggregate fair value of all derivative instruments with credit-risk-related contingent features that are in a net liability position as of September 30, 2023 was $ 63 for which the legal entities have posted collateral of $ 64 in the normal course of business.

Based on derivative contractual terms as of September 30, 2023, a downgrade of the current financial strength ratings by either Moody's or S&P would no t require additional assets to be posted as collateral.

The aggregate fair value of all derivative instruments with credit-risk-related contingent features that are in a net liability position as of March 31, 2024 was $ 37 for which the legal entities have posted collateral of $ 34 in the normal course of business.

Based on derivative contractual terms as of March 31, 2024, a downgrade of the current financial strength ratings by either Moody's or S&P would no t require additional assets to be posted as collateral.

This requirement could change as a result of changes in our hedging activities or to the extent changes in contractual terms are negotiated.

3 unchanged sentences

Equity Repurchase Program

During the nine months ended September 30, 2023 and 2022, the Company repurchased $ 1.05 billion ( 14.6 million shares) and $ 1.2 billion ( 17.4 million shares), respectively, of common stock under Board authorized share repurchase programs covering the applicable periods.

As of September 30, 2023, the Company has $ 1.7 billion remaining for equity repurchases under the current $ 3.0 billion share repurchase program, which is effective until December 31, 2024.

During the period

October 1, 2023 through October 25, 2023, the Company repurchased $ 122 ( 1.7 million shares) under this repurchase program.

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 .

During the three months ended March 31, 2024 and 2023, the Company repurchased $ 350 ( 3.8 million shares) and $ 350 ( 4.7 million shares), respectively, of common stock under Board authorized share repurchase programs covering the applicable

As of March 31, 2024, the Company has $ 1.0 billion remaining for equity repurchases under the current $ 3.0 billion share repurchase program, which is effective until December 31, 2024.

During the period April 1, 2024 through April 24, 2024, the Company repurchased $ 113 ( 1.1 million shares) under this repurchase program.

Note 14 - Equity

T HE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 .

CHANGES IN AND RECLASSIFICATIONS FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in AOCI, Net of Tax for the Three Months Ended September 30, 2023

Net Unrealized Gain (Loss) on Fixed Maturities, AFS Unrealized Loss on Fixed Maturities with ACL Net Gain on Cash Flow Hedging Instruments Foreign Currency Translation Adjustments Liability for Future Policy Benefits Adjustments Pension and Other Postretirement Plan Adjustments AOCI,

Beginning balance $ ( 2,277 ) $ ( 10 ) $ 31 $ 36 $ 32 $ ( 1,336 ) $ ( 3,524 )

OCI before reclassifications ( 876 ) ( 1 ) ( 5 ) ( 1 ) 19 1 ( 863 )

Amounts reclassified from AOCI 26 2 ( 1 ) — — 7 34

OCI, before tax ( 850 ) 1 ( 6 ) ( 1 ) 19 8 ( 829 )

Income tax benefit (expense) 179 — 2 — ( 4 ) ( 2 ) 175

OCI, net of tax ( 671 ) 1 ( 4 ) ( 1 ) 15 6 ( 654 )

Ending balance $ ( 2,948 ) $ ( 9 ) $ 27 $ 35 $ 47 $ ( 1,330 ) $ ( 4,178 )

Note 16 - Accumulated Other Comprehensive Income (Loss)

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Changes in AOCI, Net of Tax for the Nine Months Ended September 30, 2023

Changes in AOCI, Net of Tax for the Three Months Ended March 31, 2024

Net Unrealized Gain (Loss) on Fixed Maturities, AFS Unrealized Losses on Fixed Maturities with ACL Net Gain (Loss) on Cash Flow Hedging Instruments Foreign Currency Translation Adjustments Liability for Future Policy Benefits Adjustments Pension and Other Postretirement Plan Adjustments AOCI,

7 unchanged sentences

Reclassifications from AOCI

Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 Affected Line Item in the Condensed Consolidated Statement of Operations

Three Months Ended March 31, 2024 Affected Line Item in the Condensed Consolidated Statement of Operations

Net Unrealized Gain (Loss) on Fixed Maturities, AFS

3 unchanged sentences

$ ( 6 ) Net income

Unrealized Losses on Fixed Maturities with ACL

Available-for-sale fixed maturities $ ( 2 ) $ ( 4 ) Net realized gains (losses)

( 2 ) ( 4 ) Total before tax

— ( 1 ) Income tax expense

$ ( 2 ) $ ( 3 ) Net income

Net Gain (Loss) on Cash Flow Hedging Instruments

14 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Changes in AOCI, Net of Tax for the Three Months Ended September 30, 2022

Beginning balance $ ( 1,858 ) $ ( 2 ) $ 30 $ 33 $ 13 $ ( 1,465 ) $ ( 3,249 )

OCI before reclassifications ( 1,564 ) ( 6 ) 51 ( 24 ) 31 1 ( 1,511 )

Amounts reclassified from AOCI 70 — ( 2 ) — — 15 83

OCI, before tax ( 1,494 ) ( 6 ) 49 ( 24 ) 31 16 ( 1,428 )

Income tax benefit (expense) 314 1 ( 10 ) 5 ( 7 ) ( 3 ) 300

OCI, net of tax ( 1,180 ) ( 5 ) 39 ( 19 ) 24 13 ( 1,128 )

Ending balance $ ( 3,038 ) $ ( 7 ) $ 69 $ 14 $ 37 $ ( 1,452 ) $ ( 4,377 )

Changes in AOCI, Net of Tax for the Nine Months Ended September 30, 2022

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Changes in AOCI, Net of Tax for the Three Months Ended March 31, 2023

7 unchanged sentences

Reclassifications from AOCI

Three Months Ended September 30, 2022 Nine Months Ended September 30, 2022 Affected Line Item in the Condensed Consolidated Statement of Operations

Three Months Ended March 31, 2023 Affected Line Item in the Condensed Consolidated Statement of Operations

Net Unrealized Gain (Loss) on Fixed Maturities, AFS

19 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

EMPLOYEE BENEFIT PLANS

5 unchanged sentences

Pension Benefits Other Postretirement Benefits

Three Months Ended September 30, Nine Months Ended September 30, Three Months Ended September 30, Nine Months Ended September 30,

Three Months Ended March 31, Three Months Ended March 31,

2024 2023 2024 2023

7 unchanged sentences

In recognition of the need to become more cost efficient and competitive along with enhancing the experience we provide to agents and customers, on July 30, 2020 the Company announced an operational transformation and cost reduction plan it refers to as Hartford Next.

Hartford Next is intended to reduce annual insurance operating costs and other expenses through reduction of the Company's headcount, investment in information technology ("IT") to further enhance our capabilities, and other activities.

The activities are expected to be substantially complete by the end of 2023.

Termination benefits related to workforce reductions and professional fees are included within restructuring and other costs in the Condensed Consolidated Statement of Operations and unpaid restructuring costs are included in other liabilities in the September 30, 2023 and December 31, 2022 Condensed Consolidated Balance Sheets.

Subsequent to September 30, 2023, the Company expects to incur additional costs including amortization of right of use assets and other lease exit costs, other IT costs to retire applications and other expenses.

Hartford Next reduced annual insurance operating costs and other expenses through reduction of the Company's headcount, investment in information technology ("IT") to further enhance our capabilities, and other activities.

The activities were substantially completed as of December 31, 2023.

Termination benefits related to workforce reductions and professional fees are included within restructuring and other costs in the Condensed Consolidated Statement of Operations.

Subsequent to March 31, 2024, the Company expects to incur additional costs including amortization of right of use assets and other lease exit costs, other IT costs to retire applications and other expenses.

Total restructuring and other costs are expected to be approximately $ 126 , before tax, and will be recognized in Corporate for segment reporting.

The estimated restructuring and other costs for future periods do not include all costs associated with the real estate consolidation plan as those plans are still being finalized.

Restructuring and Other Costs, Before Tax

Incurred in the Three Months Ended September 30, Incurred in the Nine Months Ended September 30, Cumulative Incurred Through September 30, 2023 Total Amount Expected to be Incurred

2023 2022 2023 2022

Incurred in the Three Months Ended March 31, Cumulative Incurred Through March 31, 2024 Total Amount Expected to be Incurred

Severance benefits $ — $ ( 3 ) $ 35 $ 35

2 unchanged sentences

Total restructuring and other costs, before tax $ 1 $ — $ 125 $ 126

Note 18 - Restructuring and Other Costs

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Accrued Restructuring and Other Costs

Nine Months Ended September 30, 2023

Severance Benefits and Related Costs IT Costs Professional Fees and Other Total Restructuring and Other Costs Liability

Balance, beginning of period $ 7 $ — $ — $ 7

Incurred ( 5 ) 4 5 4

Payments ( 1 ) ( 4 ) ( 5 ) ( 10 )

Balance, end of period $ 1 $ — $ — $ 1

Accrued Restructuring and Other Costs

Nine Months Ended September 30, 2022

Severance Benefits and Related Costs IT Costs Professional Fees and Other Total Restructuring and Other Costs Liability

Balance, beginning of period $ 18 $ — $ — $ 18

Incurred ( 7 ) 6 11 10

Payments ( 4 ) ( 6 ) ( 11 ) ( 21 )

Balance, end of period $ 7 $ — $ — $ 7

Index to MD&A

2 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.

What changed 10-Q

Item 1. Financial Statements