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Item 1. Financial Statements

2024-07-25 compared with 2024-04-25 · 347 added, 231 removed, 1360 unchanged (30% 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 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").

and subsidiaries (the "Company") as of June 30, 2024, the related condensed consolidated statements of operations, comprehensive income, and changes in stockholders' equity for the three-month and six-month periods ended June 30, 2024 and 2023, and of cash flows for the six-month periods ended June 30, 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.

12 unchanged sentences

Hartford, Connecticut

April 25, 2024

July 25, 2024

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

Condensed Consolidated Statements of Operations

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

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

2 unchanged sentences

Net investment income 602 540 1,195 1,055

Net realized gains (losses) 28 ( 7 )

Net realized losses ( 59 ) ( 64 ) ( 31 ) ( 71 )

Other revenues 26 25 45 45

3 unchanged sentences

Amortization of deferred policy acquisition costs ("DAC")

561 502 1,106 993

Insurance operating costs and other expenses 1,285 1,225 2,568 2,441

14 unchanged sentences

Condensed Consolidated Statements of Comprehensive Income

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(in millions) 2024 2023 2024 2023

12 unchanged sentences

Condensed Consolidated Balance Sheets

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

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

2024 December 31, 2023

28 unchanged sentences

Stockholders’ Equity

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

Preferred stock, $ 0.01 par value — 50,000,000 shares authorized, 13,800 shares issued at June 30, 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 June 30, 2024 and December 31, 2023

Additional paid-in capital 558 648

9 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders' Equity

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

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

35 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Three Months Ended March 31,

Six Months Ended June 30,

(in millions) 2024 2023

2 unchanged sentences

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

Net realized losses (gains) ( 28 ) 7

Net realized losses 31 71

Amortization of deferred policy acquisition costs 1,106 993

22 unchanged sentences

Limited partnership and other alternative investments ( 314 ) ( 545 )

Net proceeds from derivatives — 23

Net proceeds from (payments for) derivatives 2 ( 37 )

Net additions of property and equipment ( 111 ) ( 99 )

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

Net proceeds from short-term investments 258 614

Other investing activities, net 1 ( 9 )

Net cash used for investing activities ( 435 ) ( 446 )

Net cash provided by (used for) investing activities ( 1,323 ) 53

Financing Activities

40 unchanged sentences

and contingencies relating to corporate litigation and regulatory matters.

Reclassifications

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

EARNINGS PER COMMON SHARE

Computation of Basic and Diluted Earnings per Common Share

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

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

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Net Income (Loss)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Commercial Lines $ 540 $ 458 $ 1,113 $ 879

10 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Earned premiums and fee income:

2 unchanged sentences

Liability 540 502 1,066 988

Marine 67 66 134 125

Package business 572 514 1,121 998

1 unchanged sentence

Professional liability 200 196 403 384

Bond 80 80 158 157

Assumed reinsurance 180 143 361 281

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Net investment income 602 540 1,195 1,055

Net realized gains (losses) 28 ( 7 )

Net realized losses ( 59 ) ( 64 ) ( 31 ) ( 71 )

Other revenues 26 25 45 45

1 unchanged sentence

$ 6,486 $ 6,049 $ 12,905 $ 11,959

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

[1] For the three months ended June 30, 2024 and 2023, AARP members accounted for earned premiums of $ 788 and $ 710 , respectively.

For the six months ended June 30, 2024 and 2023, AARP members accounted for earned premiums of $ 1.55 billion and $ 1.40 billion, respectively.

Note 3 - Segment Information

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Non-Insurance Revenue from Contracts with Customers

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Revenue Line Item 2024 2023 2024 2023

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

Assets and (Liabilities) Carried at Fair Value by Hierarchy Level as of June 30, 2024

Total Quoted Prices in

21 unchanged sentences

Derivative assets

Credit derivatives 29 — 29 —

Foreign exchange derivatives 8 — 8 —

Interest rate derivatives 1 — 1 —

Total derivative assets [2] 8 — 8 —

3 unchanged sentences

Derivative liabilities

Credit derivatives $ ( 29 ) $ — $ ( 29 ) $ —

Foreign exchange derivatives $ 31 $ — $ 31 $ —

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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 $ 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.

The Company has overseas deposits included in other investments of $ 65 and $ 75 as of June 30, 2024 and December 31, 2023, respectively, which are measured at fair value using the net asset value as a practical expedient.

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

107 unchanged sentences

Input on Fair Value [2]

As of March 31, 2024

As of June 30, 2024

CLO [3] $ 97 Discounted cash flows Spread 275 bps 275 bps 275 bps Decrease

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

As of June 30, 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 March 31, 2024, no significant adjustments were made by the Company to broker prices received.

As of June 30, 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

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

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Total realized/unrealized gains (losses)

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

Fair value as of March 31, 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 June 30, 2024

Fixed maturities, AFS

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

Three Months Ended March 31, 2023

Six Months Ended June 30, 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 March 31, 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 June 30, 2024

Fixed maturities, AFS

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Total Assets $ 2,487 $ ( 1 ) $ ( 21 ) $ 971 $ ( 126 ) $ ( 51 ) $ 6 $ ( 223 ) $ 3,042

Note 4 - Fair Value Measurements

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

Three Months Ended June 30, 2023

Total realized/unrealized gains (losses)

Fair value as of March 31, 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 June 30, 2023

Fixed maturities, AFS

ABS $ 36 $ — $ — $ — $ — $ — $ — $ ( 36 ) $ —

CLO 151 — — — ( 26 ) — — ( 40 ) 85

CMBS 231 ( 2 ) 7 2 ( 1 ) ( 5 ) 6 — 238

Corporate 1,643 ( 2 ) ( 3 ) 51 ( 30 ) ( 2 ) 4 ( 39 ) 1,622

RMBS 57 — — 19 ( 7 ) — — — 69

Total fixed maturities, AFS 2,118 ( 4 ) 4 72 ( 64 ) ( 7 ) 10 ( 115 ) 2,014

FVO securities 172 ( 5 ) — — ( 4 ) — — — 163

Equity securities, at fair value 60 ( 1 ) — — — — — — 59

Short-term investments 187 — — 3 ( 4 ) — — — 186

Total Assets $ 2,537 $ ( 10 ) $ 4 $ 75 $ ( 72 ) $ ( 7 ) $ 10 $ ( 115 ) $ 2,422

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

Six Months Ended June 30, 2023

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 June 30, 2023

Fixed maturities, AFS

ABS $ 30 $ — $ — $ 36 $ — $ — $ — $ ( 66 ) $ —

CLO 115 — — 40 ( 30 ) — — ( 40 ) 85

CMBS 222 ( 2 ) 2 6 ( 1 ) ( 5 ) 16 — 238

Corporate 1,589 ( 1 ) 28 117 ( 81 ) ( 9 ) 31 ( 52 ) 1,622

RMBS 95 — — 19 ( 15 ) — — ( 30 ) 69

Total fixed maturities, AFS 2,051 ( 3 ) 30 218 ( 127 ) ( 14 ) 47 ( 188 ) 2,014

FVO securities 178 ( 13 ) — — ( 2 ) — — — 163

Equity securities, at fair value 61 ( 2 ) — 1 ( 1 ) — — — 59

Short-term investments 193 — — 4 ( 11 ) — — — 186

Total Assets $ 2,483 $ ( 18 ) $ 30 $ 223 $ ( 141 ) $ ( 14 ) $ 47 $ ( 188 ) $ 2,422

[1] Amounts in these columns are generally reported in net realized gains (losses).

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Level 3 Still Held at End of Period

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023 2024 2023 2024 2023

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

Fixed maturities, AFS

3 unchanged sentences

FVO securities ( 2 ) ( 5 ) — — 1 ( 13 ) — —

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

Total Assets $ ( 2 ) $ ( 8 ) $ ( 17 ) $ 3 $ 1 $ ( 16 ) $ ( 22 ) $ 30

6 unchanged sentences

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.

As of June 30, 2024 and December 31, 2023, the fair value of assets using the fair value option was $ 272 and $ 327 ,

respectively, of which $ 160 and $ 167 , respectively, were residual interests of securitizations.

For the three and six months ended June 30, 2024, realized gains (losses) related to the change in fair value of assets using the fair value option were $( 1 ) and $ 3 , respectively.

For the three and six months ended June 30, 2023, realized losses related to the change in fair value of assets using the fair value option were $ 3 and $ 11 , respectively.

Financial Instruments Not Carried at Fair Value

Financial Assets and Liabilities Not Carried at Fair Value

March 31, 2024 December 31, 2023

June 30, 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 March 31, 2024 and December 31, 2023, the carrying amount of mortgage loans is net of ACL of $ 48 and $ 51 , respectively.

[1] As of June 30, 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.

3 unchanged sentences

Net Realized Gains (Losses)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(Before tax) 2024 2023 2024 2023

Gross gains on sales of fixed maturities

$ 6 $ 3 $ 11 $ 20

Gross losses on sales of fixed maturities

7 unchanged sentences

Other, net [2] ( 3 ) ( 48 ) ( 6 ) ( 63 )

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

[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.

Net realized (losses) $ ( 59 ) $ ( 64 ) $ ( 31 ) $ ( 71 )

[1] The change in net unrealized gains (losses) on equity securities still held as of June 30, 2024 and included in net realized gains (losses) were $ 15 and $ 44 for the three and six months ended June 30, 2024, respectively.

The change in net unrealized gains (losses) on equity securities still held as of June 30, 2023 and included in net realized gains (losses) were $ 7 and $ 7 for the three and six months ended June 30, 2023, respectively.

[2] For the three and six months ended June 30, 2024 includes gains (losses) from transactional foreign currency revaluation of $ 4 and $ 6 , respectively, and gains (losses) on non-qualifying derivatives of $( 6 ), and $( 8 ), respectively.

For the three and six months ended June 30, 2023 includes gains (losses) from transactional foreign currency revaluation of $( 9 ) and $( 16 ), respectively, and gains (losses) on non-qualifying derivatives of $( 39 ) and $( 34 ), respectively.

Proceeds from the sales of fixed maturities, AFS totaled $ 2.3 billion and $ 2.7 billion for the three and six months ended June 30, 2024, respectively, and $ 0.6 billion and $ 2.0 billion for the three and six months ended June 30, 2023.

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.

As of June 30, 2024 and December 31, 2023, the Company reported accrued investment income related to fixed maturities, AFS of $ 395 and $ 371 , respectively, and accrued investment income related to mortgage loans of $ 22 and $ 20 , respectively.

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

5 unchanged sentences

The Company will record an "intent-to-sell impairment" as a reduction to the amortized cost of fixed maturities, AFS in an unrealized loss position if the Company intends to sell or it is more likely than not that the Company will be required to sell the fixed maturity before a recovery in value.

A corresponding charge is recorded in net realized losses equal to the difference between the fair value on the impairment date and the amortized cost basis of the fixed maturity before recognizing the impairment.

A corresponding charge is recorded in net realized losses equal to the difference

between the fair value on the impairment date and the amortized cost basis of the fixed maturity before recognizing the impairment.

For fixed maturities where a credit loss has been identified and no intent-to-sell impairment has been recorded, the Company will record an ACL for the portion of the unrealized loss related to the credit loss.

7 unchanged sentences

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

Note 5 - Investments

1 unchanged sentence

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.

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.

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 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 March 31,

Three Months Ended June 30,

(Before tax) Corporate CMBS Total Corporate CMBS Total

1 unchanged sentence

Credit losses on fixed maturities where an allowance was not previously recorded — 1 1 2 — 2

Reduction due to sales — — — ( 2 ) — ( 2 )

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

Balance as of end of period $ 6 $ 13 $ 19 $ 6 $ 12 $ 18

ACL on Fixed Maturities, AFS by Type

Six Months Ended June 30,

(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 — 1 1 6 — 6

Reduction due to sales — — — ( 2 ) — ( 2 )

Net increases (decreases) on fixed maturities where an allowance was previously recorded 1 — 1 — 2 2

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

Balance as of end of period $ 6 $ 13 $ 19 $ 6 $ 12 $ 18

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Fixed Maturities, AFS

Fixed Maturities, AFS, by Type

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Cost ACL Gross

11 unchanged sentences

Fixed Maturities, AFS, by Contractual Maturity Year

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Amortized Cost Fair Value Amortized Cost Fair Value

6 unchanged sentences

Total fixed maturities, AFS $ 43,035 $ 40,814 $ 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.

3 unchanged sentences

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.

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 June 30, 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 (continued)

Unrealized Losses on Fixed Maturities, AFS

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

Unrealized Loss Aging for Fixed Maturities, AFS by Type and Length of Time as of June 30, 2024

Less Than 12 Months 12 Months or More Total

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

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.

As of June 30, 2024, fixed maturities, AFS in an unrealized loss position consisted of 4,033 instruments and were primarily depressed due to higher interest rates and/or wider credit spreads since the purchase date.

As of June 30, 2024, 94 % of these fixed maturities were depressed less than 20% of cost or amortized cost.

The increase in unrealized losses during the six months ended June 30, 2024, was primarily attributable to higher interest rates.

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

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 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 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

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 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.

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 June 30, 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 June 30, 2024 or December 31, 2023.

In addition, for the three and six months ended June 30, 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 March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

ACL as of beginning of period $ 48 $ 36 $ 51 $ 36

Current period provision (release) — 5 ( 3 ) 5

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 %.

ACL as of June 30, $ 48 $ 41 $ 48 $ 41

The release in the allowance for the six months ended June 30, 2024, is primarily attributable to improved economic scenario forecasts and property specific reductions, partially offset by net additions of new loans.

The increase in the allowance f or the three and six months ended June 30, 2023, is primarily attributable to the overall weaker projected real estate fundamentals, and to a lesser extent, net additions of new loans.

The weighted-average LTV ratio of the Company’s mortgage loan portfolio was 55 % as of June 30, 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 March 31, 2024

Mortgage Loans LTV & DSCR by Origination Year as of June 30, 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 (continued)

Mortgage Loans by Region

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Amortized Cost Percent of Total Amortized Cost Percent of Total

13 unchanged sentences

Mortgage Loans by Property Type

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Amortized Cost Percent of Total Amortized Cost Percent of Total

10 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 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)

As of June 30, 2024 and December 31, 2023, the Company held no mortgage loans considered past due.

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 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 June 30, 2024, under this program, the Company serviced mortgage loans with a total outstanding

principal of $ 9.8 billion, of which $ 4.6 billion was serviced on behalf of third parties and $ 5.2 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 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.

Servicing rights are carried at the lower of cost or fair value and were $ 0 as of June 30, 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 March 31, 2024 and December 31, 2023, the Company did no t hold any securities for which it is the primary beneficiary.

As of June 30, 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 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.

The Company’s maximum exposure to loss as of June 30, 2024 and December 31, 2023 was limited to the total carrying value of $ 3.1 billion and $ 3.0 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 June 30, 2024 and December 31, 2023, the Company has outstanding commitments totaling $ 1.8 billion and $ 1.7 billion, respectively, 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.

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.

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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.

1 unchanged sentence

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.

For the three and six months ended June 30, 2024, the Company recognized amortization of $ 1 and $ 2 , respectively, and related tax benefits of $ 3 and $ 5 , respectively.

For the three and six months ended June 30, 2023, the Company recognized amortization of $ 0 and less than $ 1 , respectively, and related tax benefits of less than $ 1 for both periods.

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.

The carrying value of these investments, which are reported in other assets on the Company’s Condensed Consolidated Balance Sheets was $ 23 and $ 20 as of June 30, 2024, and December 31, 2023, respectively.

As of June 30, 2024 and December 31, 2023, the Company has outstanding commitments related to affordable housing projects of $ 215 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.

3 unchanged sentences

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

Reverse Repurchase Agreements

From time to time, the Company enters into reverse repurchase agreements where the Company purchases securities and simultaneously agrees to resell the same or substantially the same securities.

From time to time, the Company enters into reverse repurchase agreements where the Company purchases securities and

simultaneously agrees to resell the same or substantially the same securities.

The maturity of these transactions is generally within one year.

1 unchanged sentence

The Company accounts for reverse repurchase agreements as collateralized financing.

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.

As of both June 30, 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 March 31, 2024 and December 31, 2023, the Company pledged collateral of $ 6 and $ 7 , respectively, of U.S.

As of June 30, 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.

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Fair Value Fair Value

5 unchanged sentences

Total Other Restricted Investments $ 3,447 $ 3,488

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

The Company utilizes a variety of OTC, OTC-cleared and exchange traded derivative instruments as a part of its overall risk management strategy as well as to enter into replication transactions or income generation covered call transactions.

15 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

Credit default swaps are used to purchase credit protection on an individual entity or referenced index to economically hedge against default risk and credit-related changes in the value of fixed maturity securities.

Credit default swaps are used to purchase credit protection on an individual entity or referenced index to economically hedge against default risk and credit-related changes in the value of

fixed maturity securities.

Credit default swaps are also used to assume credit risk related to an individual entity or referenced index as a part of replication transactions.

4 unchanged sentences

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.

As of June 30, 2024 and December 31, 2023, the notional amount of interest rate swaps in offsetting relationships was $ 344 and $ 6.6 billion, respectively.

Foreign Currency Swaps and Forwards

1 unchanged sentence

Equity Index Options

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 enters into equity index options to hedge the impact of a decline in the equity markets on the investment portfolio.

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 (continued)

Derivative Balance Sheet Presentation

2 unchanged sentences

Notional Amount Fair Value Fair Value Fair Value

Hedge Designation/ Derivative Type Mar 31, 2024 Dec.

31, 2023 Mar 31, 2024 Dec.

Hedge Designation/ Derivative Type Jun 30, 2024 Dec.

31, 2023 Jun 30, 2024 Dec.

Cash flow hedges

16 unchanged sentences

Total derivatives $ 7,398 $ 12,363 $ 38 $ 7 $ 79 $ 57 $ ( 41 ) $ ( 50 )

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Offsetting of Derivative Assets/Liabilities

2 unchanged sentences

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 (continued)

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 March 31, 2024

As of June 30, 2024

Other investments $ 79 $ 79 $ 8 $ ( 8 ) $ — $ —

12 unchanged sentences

Gains (Losses) Recognized in OCI

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Interest rate swaps $ ( 4 ) $ ( 14 ) $ ( 21 ) $ ( 4 )

1 unchanged sentence

Total $ 11 $ ( 21 ) $ 11 $ ( 14 )

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 March 31,

Net Investment Income Interest Expense Net Investment Income Interest Expense

Three months ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

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

Interest rate swaps $ ( 8 ) $ 5 $ ( 7 ) $ 4 $ ( 15 ) $ 9 $ ( 15 ) $ 7

2 unchanged sentences

Total amounts presented on the Condensed Consolidated Statement of Operations $ 602 $ 50 $ 540 $ 50 $ 1,195 $ 100 $ 1,055 $ 100

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 .

As of June 30, 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 $ 9 .

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 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.

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.

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

During the three and six months ended June 30, 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

1 unchanged sentence

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

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Interest rate contracts

12 unchanged sentences

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 may reference investment grade single corporate issuers and

baskets, which include standard diversified portfolios of corporate and 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

4 unchanged sentences

Obligation(s) [1]

As of March 31, 2024

As of June 30, 2024

Basket credit default swaps [4]

21 unchanged sentences

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

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 .

As of June 30, 2024 and December 31, 2023, the Company ha s pl edged cash collateral associated with derivative instruments of $ 26 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 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.

As of June 30, 2024 and December 31, 2023, the Company pledged securities collateral associated with derivative instruments with a fair value of $ 2 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 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 .

In addition, as of June 30, 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 $ 13 and $ 16 , respectively, which is recorded in other investments or other assets on the Company's Condensed Consolidated Balance Sheets.

As of June 30, 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 $ 142 and $ 112 , respectively, which are included within fixed maturities on the Company's Condensed Consolidated Balance Sheets.

As of June 30, 2024 and December 31, 2023, the Company accepted cash collateral associated with derivative instruments of $ 73 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 June 30, 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 June 30, 2024 and December 31, 2023, the Company had no repledged securities.

In addition, as of June 30, 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

3 unchanged sentences

Premiums Receivable and Agents' Balances

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

As of June 30, 2024 As of December 31, 2023

Premiums receivable, excluding receivables for losses within a deductible and retrospectively-rated policy premiums ("loss sensitive business") $ 6,025 $ 5,303

27 unchanged sentences

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

March 31, 2024 March 31, 2023

June 30, 2024 June 30, 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

4 unchanged sentences

Ending ACL $ 95 $ 21 $ 116 $ 94 $ 25 $ 119

Note 8 - Reinsurance

Note 7 - Premiums Receivable and Agents' Balances

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

June 30, 2024 June 30, 2023

Beginning ACL

$ 89 $ 20 $ 109 $ 85 $ 24 $ 109

Current period provision 30 1 31 31 1 32

Current period write-offs ( 27 ) — ( 27 ) ( 27 ) — ( 27 )

Current period recoveries 3 — 3 5 — 5

$ 95 $ 21 $ 116 $ 94 $ 25 $ 119

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

10 unchanged sentences

Reinsurance Recoverables by Credit Quality Indicator

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

As of June 30, 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 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

Note 8 - Reinsurance

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 Months Ended

Three Months Ended March 31,

Allowance for Uncollectible Reinsurance for the Three and Six Months Ended

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

P&C beginning allowance for uncollectible reinsurance $ 98 $ 102 $ 100 $ 102

14 unchanged sentences

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses

For the three months ended March 31,

For the six months ended June 30,

Beginning liabilities for unpaid losses and loss adjustment expenses, gross

6 unchanged sentences

Prior accident year development [1]

( 171 ) ( 39 )

Total provision for unpaid losses and loss adjustment expenses

10 unchanged sentences

$ 35,137 $ 33,029

[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.

[1] Prior accident year development for the six months ended June 30, 2024 includes a $ 61 benefit for amortization of a deferred gain under retroactive reinsurance accounting related to the Navigators Adverse Development Cover (the "Navigator's 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.

3 unchanged sentences

Unfavorable (Favorable) Prior Accident Year Development

For the three months ended March 31,

For the six months ended June 30,

Workers’ compensation $ ( 119 ) $ ( 113 )

1 unchanged sentence

General liability 49 28

Marine ( 1 ) ( 1 )

Package business ( 1 ) ( 8 )

1 unchanged sentence

Professional liability ( 7 ) ( 3 )

Bond ( 22 ) 12

Assumed reinsurance 24 17

9 unchanged sentences

Total prior accident year development $ ( 171 ) $ ( 39 )

[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.

[1] The $ 61 change in deferred gain on retroactive reinsurance for the six months ended June 30, 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

Re-estimates of prior accident year reserves for the six months ended June 30, 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

General liability reserves were increased primarily in response to higher frequency of large losses within certain lines in the 2016 to 2019 accident years, with some modest increases in the more recent accident years.

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

Lastly, reserves for extra contractual liability claims and other miscellaneous run-off lines were reduced in response to recent favorable loss activity.

Professional liability reserves decreased modestly due to favorable development on directors' and officers' ("D&O") claims driven by the 2020 to 2022 accident years, partially offset by deterioration in older accident years.

Bond reserves decreased due to favorable development on commercial and contract surety driven by accident years 2019 and prior.

Assumed reinsurance reserves were increased due to higher reserve estimates in the Latin America surety and Latin America P&C businesses related to the 2020 to 2023 accident years.

Automobile liability reserves - Commercial Lines increased primarily due to adverse loss development within accident year 2022 driven by higher severity than estimated.

Automobile liability reserves - Personal Lines were decreased primarily in response to better than anticipated accident year 2023 claim severity for property damage liability.

Catastrophes reserves were decreased primarily within Commercial Lines driven by a reduction in reserves in accident years 2021 to 2022 related to favorable emergence related to various hail events, as well as favorable development in accident year 2022 related to Hurricane Ian.

Other reserve re-estimates, net, included a decrease in reserves due to lower severity than expected on Personal Lines automobile physical damage for accident year 2023, offset by an increase in reserves related to unfavorable development from participation in involuntary market pools.

Re-estimates of prior accident year reserves for the six months ended June 30, 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 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.

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 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.

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

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.

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

Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses

1 unchanged sentence

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.

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.

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

Change in Deferred Gain on Retroactive Reinsurance

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 and six months ended June 30, 2024, the Company collected recoveries from NICO and as a result amortized $ 37 and $ 61 of the deferred gain within benefits, losses and loss adjustment expenses in the three and six month periods, respectively.

As of June 30, 2024 and December 31, 2023, the deferred gain on the Navigators ADC was $ 148 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.

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.

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If the court approvals for the BSA’s plan of reorganization are not affirmed on appeal, it is possible that adverse outcomes, if any, could have a material adverse effect on the Company’s operating results.

Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

| GROUP LIFE, DISABILITY AND ACCIDENT PRODUCTS

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses

For the three months ended March 31,

For the six months ended June 30,

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

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[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 $ 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.

[2] Includes unallocated loss adjustment expenses ("ULAE") of $ 92 and $ 91 for the six months ended June 30, 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 six months ended June 30, 2024

Group disability- Prior period reserve estimates decreased by approximately $ 282 largely driven by group long-term disability claim incidence lower than prior assumptions and favorable recoveries on prior incurral year claims, as well as a higher New York paid family leave risk adjustment benefit than expected .

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $ 56 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.

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

Re-estimates of prior incurral years reserves for the six months ended June 30, 2023

Group disability- Prior period reserve estimates decreased by approximately $ 236 largely driven by group long-term disability claim incidence lower than prior assumptions and strong recoveries on prior incurral year claims.

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Rollforward of Reserve for Future Policy Benefits

For the three months ended March 31,

For the six months ended June 30,

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

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Net Reserve for Future Policy Benefits

As of March 31,

As of June 30,

Payout Annuities $ 129 $ 139

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Total $ 464 $ 489

Note 10 - Reserve for Future Policy Benefits

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Undiscounted Expected Future Gross Premiums and Benefit Payments

As of March 31,

As of June 30,

Payout Annuities [1]

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[1] Payout Annuities and Paid-up Life have no expected future gross premiums.

Note 10 - Reserve for Future Policy Benefits

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Weighted-Average Interest Rates

As of March 31,

As of June 30,

Payout Annuities

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Current discount rate 5.4 % 5.3 %

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

Gross premiums and interest accretion recognized on long-duration insurance policies for the six months ended June 30, 2024 and 2023 were immaterial.

OTHER POLICYHOLDER FUNDS AND BENEFITS PAYABLE

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

Other policyholder funds and benefits payable of $ 622 and $ 647 as of June 30, 2024 and 2023 respectively, included universal life long-duration contacts of $ 210 and $ 228 as well as policyholder balances related to short-duration contracts of $ 412

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 three months ended March 31,

For the six months ended June 30,

Balance, beginning of the period $ 223 $ 232

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

As of June 30, 2024 and 2023, universal life contracts of $ 209 and $ 227 , respectively, had crediting rates at their guaranteed minimums ranging from 4 %- 5 % .

Note 12 - Income Taxes

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Income Tax Rate Reconciliation

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Tax provision at U.S.

1 unchanged sentence

Nontaxable investment income ( 11 ) ( 9 ) ( 22 ) ( 20 )

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

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

Other ( 7 ) ( 7 ) ( 29 ) ( 15 )

Provision for income taxes $ 174 $ 125 $ 332 $ 243

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Rollforward of Unrecognized Tax Benefits

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

Balance, beginning of period $ 27 $ 23 $ 26 $ 22

Gross increases - tax positions in current period — 1 1 2

Lapse of statute of limitations — ( 1 ) — ( 1 )

Balance, end of period $ 27 $ 23 $ 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.

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

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.

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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, 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.

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.

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

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

COVID-19 Pandemic Business Income Insurance Litigation

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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.

The Company has obtained numerous dismissals in its favor and affirmances 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.

aggregate, could have a material adverse effect on the Company’s consolidated operating results or liquidity.

Run-off Asbestos and Environmental Claims

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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 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").

For its Run-off A&E claims, as of June 30, 2024, the Company reported $ 182 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 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.

As of June 30, 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 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.

The aggregate fair value of all derivative instruments with credit-risk-related contingent features that are in a net liability position as of June 30, 2024 was $ 29 for which the legal entities have posted collateral of $ 28 in the normal course of business.

Based on derivative contractual terms as of June 30, 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.

2 unchanged sentences

Treasury notes and government agency securities.

Equity Repurchase Program

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

1 unchanged sentence

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 .

Equity Repurchase Program

During the six months ended June 30, 2024 and 2023, the Company repurchased $ 700 ( 7.3 million shares) and $ 700 ( 9.7 million shares), respectively, of common stock under Board authorized share repurchase programs covering the applicable periods.

As of June 30, 2024, the Company has $ 648 remaining for equity repurchases under the current $ 3.0 billion share repurchase program, which is effective until December 31, 2024.

During the period July 1, 2024 through July 24, 2024, the Company repurchased $ 105 ( 1.0 million shares) under this repurchase program.

In addition to the authorization covering the period from August 1, 2022 to December 31, 2024, in July, 2024, the Board of Directors approved a share repurchase authorization for up to $ 3.3 billion effective from August 1, 2024 to December 31, 2026.

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 March 31, 2024

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

6 unchanged sentences

Ending balance $ ( 1,732 ) $ ( 7 ) $ 30 $ 35 $ 35 $ ( 1,429 ) $ ( 3,068 )

Changes in AOCI, Net of Tax for the Six Months Ended June 30, 2024

Beginning balance $ ( 1,482 ) $ ( 8 ) $ 21 $ 37 $ 25 $ ( 1,442 ) $ ( 2,849 )

OCI before reclassifications ( 393 ) 1 11 ( 3 ) 13 1 ( 370 )

Amounts reclassified from AOCI 77 — — — — 16 93

OCI, before tax ( 316 ) 1 11 ( 3 ) 13 17 ( 277 )

Income tax benefit (expense) 66 — ( 2 ) 1 ( 3 ) ( 4 ) 58

OCI, net of tax ( 250 ) 1 9 ( 2 ) 10 13 ( 219 )

Ending balance $ ( 1,732 ) $ ( 7 ) $ 30 $ 35 $ 35 $ ( 1,429 ) $ ( 3,068 )

Note 15 - Accumulated Other Comprehensive Income (Loss)

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Reclassifications from AOCI

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

Three Months Ended June 30, 2024 Six Months Ended June 30, 2024 Affected Line Item in the Condensed Consolidated Statement of Operations

Net Unrealized Gain (Loss) on Fixed Maturities, AFS

17 unchanged sentences

Total amounts reclassified from AOCI $ ( 62 ) $ ( 74 ) Net income

Note 15 - Accumulated Other Comprehensive Income (Loss)

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

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

6 unchanged sentences

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

Changes in AOCI, Net of Tax for the Six Months Ended June 30, 2023

Beginning balance $ ( 2,594 ) $ ( 7 ) $ 40 $ 31 $ 35 $ ( 1,346 ) $ ( 3,841 )

OCI before reclassifications 353 ( 6 ) ( 14 ) 6 ( 4 ) — 335

Amounts reclassified from AOCI 48 2 3 — — 13 66

OCI, before tax 401 ( 4 ) ( 11 ) 6 ( 4 ) 13 401

Income tax benefit (expense) ( 84 ) 1 2 ( 1 ) 1 ( 3 ) ( 84 )

OCI, net of tax 317 ( 3 ) ( 9 ) 5 ( 3 ) 10 317

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

Note 15 - Accumulated Other Comprehensive Income (Loss)

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Reclassifications from AOCI

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

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

Net Unrealized Gain (Loss) on Fixed Maturities, AFS

3 unchanged sentences

$ ( 17 ) $ ( 38 ) Net income

Unrealized Losses on Fixed Maturities with ACL

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

( 2 ) ( 2 ) Total before tax

( 1 ) ( 1 ) Income tax expense

$ ( 1 ) $ ( 1 ) Net income

Net Gain (Loss) on Cash Flow Hedging Instruments

22 unchanged sentences

Pension Benefits Other Postretirement Benefits

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

Three Months Ended June 30, Six Months Ended June 30, Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023 2024 2023 2024 2023

10 unchanged sentences

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.

Subsequent to June 30, 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.

Restructuring and Other Costs, Before Tax

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

Incurred in the Three Months Ended June 30, Incurred in the Six Months Ended June 30, Cumulative Incurred Through June 30, 2024 Total Amount Expected to be Incurred

2024 2023 2024 2023

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

6 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