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Item 1. Financial Statements

2024-10-24 compared with 2024-07-25 · 309 added, 259 removed, 1448 unchanged (28% 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 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").

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

July 25, 2024

October 24, 2024

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

Condensed Consolidated Statements of Operations

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

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

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

24 unchanged sentences

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

Condensed Consolidated Statements of Comprehensive Income

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

Condensed Consolidated Statements of Comprehensive Income (Loss)

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

(in millions) 2024 2023 2024 2023

8 unchanged sentences

Other comprehensive income (loss), net of tax 1,063 ( 654 ) 844 ( 337 )

Comprehensive income $ 667 $ 277 $ 1,272 $ 1,399

Comprehensive income (loss) $ 1,830 $ ( 3 ) $ 3,102 $ 1,396

See Notes to Condensed Consolidated Financial Statements.

1 unchanged sentence

Condensed Consolidated Balance Sheets

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

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

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

Additional paid-in capital 564 648

9 unchanged sentences

Condensed Consolidated Statements of Changes in Stockholders' Equity

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

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

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

19 unchanged sentences

Accumulated Other Comprehensive Income (Loss), net of tax

Accumulated Other Comprehensive Income, net of tax, beginning of period ( 2,997 ) ( 3,254 ) ( 2,849 ) ( 3,841 )

Accumulated Other Comprehensive Income (Loss), net of tax, beginning of period ( 3,068 ) ( 3,524 ) ( 2,849 ) ( 3,841 )

Total other comprehensive income (loss) 1,063 ( 654 ) 844 ( 337 )

13 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions) 2024 2023

8 unchanged sentences

Change in assets and liabilities:

Decrease in reinsurance recoverables 37 42

Decrease (increase) in reinsurance recoverables 36 ( 10 )

Net change in accrued and deferred income taxes ( 179 ) ( 73 )

20 unchanged sentences

Other investing activities, net ( 26 ) ( 11 )

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

Net cash used for investing activities ( 2,412 ) ( 1,266 )

Financing Activities

1 unchanged sentence

Withdrawals and other deductions from investment and universal life-type contracts ( 96 ) ( 78 )

Net return of shares under incentive and stock compensation plans ( 9 ) ( 25 )

Net issuance (return) of shares under incentive and stock compensation plans 16 ( 25 )

Treasury stock acquired ( 1,100 ) ( 1,050 )

38 unchanged sentences

Computation of Basic and Diluted Earnings per Common Share

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

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

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

12 unchanged sentences

SEGMENT INFORMATION

The Company currently conducts business principally in five reporting segments including Commercial Lines, Personal Lines, Property & Casualty ("P&C") Other Operations, Group Benefits and Hartford Funds, as well as a Corporate category.

The Company currently conducts business principally in five reportable segments including Commercial Lines, Personal Lines, Property & Casualty ("P&C") Other Operations, Group Benefits and Hartford Funds, as well as a Corporate category.

Net Income (Loss)

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

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

2024 2023 2024 2023

11 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

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

2024 2023 2024 2023

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$ 6,751 $ 6,168 $ 19,656 $ 18,127

[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.

[1] For the three months ended September 30, 2024 and 2023, AARP members accounted for earned premiums of $ 817 and $ 731 , respectively.

For the nine months ended September 30, 2024 and 2023, AARP members accounted for earned premiums of $ 2.36 billion and $ 2.13 billion, respectively.

Note 3 - Segment Information

2 unchanged sentences

Non-Insurance Revenue from Contracts with Customers

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

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

Revenue Line Item 2024 2023 2024 2023

9 unchanged sentences

Investment management and other fees Fee income 10 10 30 30

Other Other revenues — — — 1

Total non-insurance revenues with customers $ 369 $ 351 $ 1,085 $ 1,042

14 unchanged sentences

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

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

Total Quoted Prices in

7 unchanged sentences

$ 3,512 $ — $ 3,464 $ 48

Collateralized loan obligations ("CLO")

Collateralized loan obligations ("CLOs")

3,563 — 3,314 249

11 unchanged sentences

Derivative assets

Foreign exchange derivatives 8 — 8 —

Credit derivatives 30 — 30 —

Interest rate derivatives 1 — 1 —

Total derivative assets [2] 31 — 31 —

3 unchanged sentences

Derivative liabilities

Credit derivatives $ ( 30 ) $ — $ ( 30 ) $ —

Equity derivatives 5 — — 5

Foreign exchange derivatives 12 — 12 —

12 unchanged sentences

ABS $ 3,320 $ — $ 3,320 $ —

CLO 3,090 — 2,977 113

CLOs 3,090 — 2,977 113

CMBS 3,125 — 2,898 227

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

The Company has overseas deposits included in other investments of $ 65 and $ 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.

The Company has overseas deposits included in other investments of $ 60 and $ 75 as of September 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

46 unchanged sentences

Fixed Maturity Investments

Structured securities (includes ABS, CLO, CMBS and RMBS)

Structured securities (includes ABS, CLOs, CMBS and RMBS)

• Benchmark yields and spreads

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• Credit default swap indices

Other inputs for ABS, CLO, and RMBS:

Other inputs for ABS, CLOs, and RMBS:

• Estimate of future principal prepayments, derived from the characteristics of the underlying structure

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• Swap yield curve • Not applicable

Equity derivatives

• Equity index levels • Equity volatility

Note 4 - Fair Value Measurements

6 unchanged sentences

Input on Fair Value [2]

As of June 30, 2024

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

As of September 30, 2024

CLOs [3] $ 79 Discounted cash flows Spread 275 bps 275 bps 275 bps Decrease

CMBS [3] $ 204 Discounted cash flows Spread (encompasses prepayment, default risk and loss severity) 250 bps 1,204 bps 444 bps Decrease

6 unchanged sentences

As of December 31, 2023

CLO [3] $ 98 Discounted cash flows Spread 268 bps 270 bps 269 bps Decrease

CLOs [3] $ 98 Discounted cash flows Spread 268 bps 270 bps 269 bps Decrease

CMBS [3] $ 226 Discounted cash flows Spread (encompasses prepayment, default risk and loss severity) 365 bps 1,315 bps 509 bps Decrease

12 unchanged sentences

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

As of June 30, 2024 and December 31, 2023, the fair values of the Company's level 3 derivatives were less than $ 1 for both periods.

As of September 30, 2024 and December 31, 2023, the fair values of the Company's level 3 derivatives were $ 5 and less than $ 1 , respectively.

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

2 unchanged sentences

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

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

As of September 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

5 unchanged sentences

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

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Total realized/unrealized gains (losses)

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

Fair value as of June 30, 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 September 30, 2024

Fixed maturities, AFS

ABS $ 8 $ — $ — $ 40 $ — $ — $ — $ — $ 48

CLO 184 — — 460 ( 14 ) — — ( 130 ) 500

CLOs 500 — — 215 ( 6 ) — — ( 460 ) 249

CMBS 190 ( 2 ) 3 — ( 3 ) ( 10 ) 28 — 206

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Total Assets $ 3,042 $ ( 3 ) $ 64 $ 556 $ ( 143 ) $ ( 26 ) $ 37 $ ( 474 ) $ 3,053

Derivatives, net [4]

Equity $ — $ — $ — $ 5 $ — $ — $ — $ — $ 5

Total Derivatives, net [4] — — — 5 — — — — 5

Total Liabilities $ — $ — $ — $ 5 $ — $ — $ — $ — $ 5

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

Six Months Ended June 30, 2024

Nine Months Ended September 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 June 30, 2024

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 September 30, 2024

Fixed maturities, AFS

ABS $ — $ — $ — $ 56 $ — $ — $ — $ ( 8 ) $ 48

CLO 113 — — 590 ( 26 ) — — ( 177 ) 500

CLOs 113 — — 805 ( 32 ) — — ( 637 ) 249

CMBS 227 ( 4 ) 15 — ( 8 ) ( 58 ) 34 — 206

6 unchanged sentences

Total Assets $ 2,487 $ ( 4 ) $ 43 $ 1,527 $ ( 269 ) $ ( 77 ) $ 43 $ ( 697 ) $ 3,053

Derivatives, net [4]

Equity $ — $ — $ — $ 5 $ — $ — $ — $ — $ 5

Total Derivatives, net [4] — — — 5 — — — — 5

Total Liabilities $ — $ — $ — $ 5 $ — $ — $ — $ — $ 5

Note 4 - Fair Value Measurements

2 unchanged sentences

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

Three Months Ended June 30, 2023

Three Months Ended September 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

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

Fixed maturities, AFS

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

CLO 151 — — — ( 26 ) — — ( 40 ) 85

CLOs 85 — — 15 ( 3 ) — — — 97

CMBS 238 — 1 — ( 14 ) — 1 — 226

7 unchanged sentences

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

Six Months Ended June 30, 2023

Nine Months Ended September 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

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

Fixed maturities, AFS

ABS $ 30 $ — $ — $ 82 $ — $ — $ — $ ( 66 ) $ 46

CLO 115 — — 40 ( 30 ) — — ( 40 ) 85

CLOs 115 — — 55 ( 33 ) — — ( 40 ) 97

CMBS 222 ( 2 ) 3 6 ( 15 ) ( 5 ) 17 — 226

10 unchanged sentences

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

[4] Derivative instruments are reported in this table on a net basis for asset (liability) positions and reported in the Condensed Consolidated Balance Sheets in other investments and other liabilities.

Note 4 - Fair Value Measurements

3 unchanged sentences

Level 3 Still Held at End of Period

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

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

2024 2023 2024 2023 2024 2023 2024 2023

1 unchanged sentence

Fixed maturities, AFS

CLOs $ — $ — $ — $ — $ — $ — $ — $ 1

CMBS — — 1 — — — 10 2

7 unchanged sentences

[2] Amounts presented are for Level 3 only and therefore may not agree to other disclosures included herein.

[3] Changes in unrealized gains (losses) on fixed maturities, AFS are reported in changes in net unrealized gain (loss) on fixed maturities in the Condensed Consolidated Statements of Comprehensive Income.

Fair Value Option

1 unchanged sentence

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

As of September 30, 2024 and December 31, 2023, the fair value of assets using the fair value option was $ 263 and $ 327 ,

respectively, of which $ 152 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.

For the three and nine months ended September 30, 2024, net realized losses related to the change in fair value of assets using the fair value option were $ 5 and $ 2 , respectively.

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

Financial Instruments Not Carried at Fair Value

Financial Assets and Liabilities Not Carried at Fair Value

June 30, 2024 December 31, 2023

September 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 $ 463 Level 2 $ 499 $ 429

[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.

[1] As of September 30, 2024 and December 31, 2023, the carrying amount of mortgage loans is net of ACL of $ 44 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 June 30, Six Months Ended June 30,

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

(Before tax) 2024 2023 2024 2023

11 unchanged sentences

Net realized (losses) $ ( 13 ) $ ( 90 ) $ ( 44 ) $ ( 161 )

[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.

[1] The change in net unrealized gains (losses) on equity securities still held as of September 30, 2024 and included in net realized gains (losses) were $ 27 and $ 71 for the three and nine months ended September 30, 2024, respectively.

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

[2] For the three and nine months ended September 30, 2024 includes gains (losses) from transactional foreign currency revaluation of $( 11 ) and $( 5 ), respectively, and gains (losses) on non-qualifying derivatives of $ 23 and $ 15 , respectively.

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

Proceeds from the sales of fixed maturities, AFS totaled $ 1.5 billion and $ 4.2 billion for the three and nine months ended September 30, 2024, respectively, and $ 0.8 billion and $ 2.8 billion for the three and nine months ended September 30, 2023.

Non-cash investing activities for both the three and nine months ended September 30, 2024, included $ 18 related to the exchange of short-term investments for equity securities.

There were no non-cash investing activities for both the three and nine months ended September 30, 2023.

Accrued Investment Income on Fixed Maturities, AFS and Mortgage Loans

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.

As of September 30, 2024 and December 31, 2023, the Company reported accrued investment income related to fixed maturities, AFS of $ 412 and $ 371 , respectively, and accrued investment income related to mortgage loans of $ 23 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.

5 unchanged sentences

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

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

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

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

Developing the Company’s best estimate of expected future cash flows is a quantitative and qualitative process that

Note 5 - Investments

1 unchanged sentence

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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.

incorporates information received from third-party sources along with certain internal assumptions regarding the future performance.

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 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 June 30,

Three Months Ended September 30,

(Before tax) Corporate CMBS Total Corporate CMBS Total

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ACL on Fixed Maturities, AFS by Type

Six Months Ended June 30,

Nine Months Ended September 30,

(Before tax) Corporate CMBS Total Corporate CMBS Total

10 unchanged sentences

Fixed Maturities, AFS, by Type

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Cost ACL Gross

1 unchanged sentence

ABS $ 3,474 $ — $ 57 $ ( 19 ) $ 3,512 $ 3,347 $ — $ 18 $ ( 45 ) $ 3,320

CLO 3,507 — 8 ( 1 ) 3,514 3,104 — 3 ( 17 ) 3,090

CLOs 3,553 — 10 — 3,563 3,104 — 3 ( 17 ) 3,090

CMBS 3,062 ( 13 ) 28 ( 220 ) 2,857 3,466 ( 12 ) 19 ( 348 ) 3,125

7 unchanged sentences

Fixed Maturities, AFS, by Contractual Maturity Year

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Amortized Cost Fair Value Amortized Cost Fair Value

11 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 June 30, 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 September 30, 2024 or December 31, 2023 other than U.S.

government securities and certain U.S.

4 unchanged sentences

Unrealized Losses on Fixed Maturities, AFS

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

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

Less Than 12 Months 12 Months or More Total

1 unchanged sentence

ABS $ 180 $ — $ 469 $ ( 19 ) $ 649 $ ( 19 )

CLO 474 ( 1 ) 68 — 542 ( 1 )

CLOs 262 — — — 262 —

CMBS 36 ( 1 ) 2,491 ( 219 ) 2,527 ( 220 )

10 unchanged sentences

ABS $ 604 $ ( 6 ) $ 1,043 $ ( 39 ) $ 1,647 $ ( 45 )

CLO 209 ( 1 ) 2,249 ( 16 ) 2,458 ( 17 )

CLOs 209 ( 1 ) 2,249 ( 16 ) 2,458 ( 17 )

CMBS 117 ( 7 ) 2,837 ( 341 ) 2,954 ( 348 )

6 unchanged sentences

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

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.

As of September 30, 2024, fixed maturities, AFS in an unrealized loss position consisted of 3,100 instruments and were primarily depressed due to higher interest rates and/or wider credit spreads since the purchase date.

As of September 30, 2024, 96 % of these fixed maturities were depressed less than 20% of cost or amortized cost.

The decrease in unrealized losses during the nine months ended September 30, 2024, was primarily attributable to lower interest rates and 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.

23 unchanged sentences

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.

During the period in which all or a portion of the mortgage loan is determined to be uncollectible, the ACL is written off against the amortized cost.

There were no mortgage loans held-for-sale as of September 30, 2024 or December 31, 2023.

For both the three and nine months ended September 30, 2024, one office property mortgage loan with an amortized cost of $ 9 was granted a term extension of three years at the original rate which is a below-market rate with a borrower experiencing

financial difficulties.

The modified loan represents less than 1 % of the portfolio and is current and performing in conjunction with the modified terms.

For the three and nine months ended September 30, 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 June 30, Six Months Ended June 30,

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

2024 2023 2024 2023

1 unchanged sentence

Current period provision (release) — 5 ( 3 ) 10

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 %.

Current period gross write-offs ( 4 ) — ( 4 ) —

ACL as of September 30,

$ 44 $ 46 $ 44 $ 46

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

Mortgage Loans LTV & DSCR by Origination Year as of September 30, 2024

2024 2023 2022 2021 2020 2019 & Prior Total

12 unchanged sentences

[1] Amortized cost of mortgage loans excludes ACL of $ 44 .

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

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Amortized Cost Percent of Total Amortized Cost Percent of Total

13 unchanged sentences

Mortgage Loans by Property Type

June 30, 2024 December 31, 2023

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

As of September 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 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 September 30, 2024, under this program, the Company serviced mortgage loans with a total outstanding principal of $ 9.9 billion, of which $ 4.7 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 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.

Servicing rights are carried at the lower of cost or fair value and were $ 0 as of September 30, 2024 and December 31, 2023, because servicing fees were market-level

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

fees at origination and remain adequate to compensate the Company for servicing the loans.

Variable Interest Entities

5 unchanged sentences

Consolidated VIEs

As of June 30, 2024 and December 31, 2023, the Company did no t hold any securities for which it is the primary beneficiary.

As of September 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 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.

The Company’s maximum exposure to loss as of September 30, 2024 and December 31, 2023 was limited to the total carrying value of $ 3.2 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 September 30, 2024 and December 31, 2023, the Company has outstanding commitments totaling $ 2.0 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.

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.

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

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

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

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

For the three 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.

For the three and nine months ended September 30, 2024, the Company recognized amortization of $ 1 and $ 3 , respectively, and related tax benefits of $ 3 and $ 8 , respectively.

For the three and nine months ended September 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 $ 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.

The carrying value of these investments, which are reported in other assets on the Company’s Condensed Consolidated Balance Sheets was $ 38 and $ 20 as of September 30, 2024, and December 31, 2023, respectively.

As of September 30, 2024 and December 31, 2023, the Company has outstanding commitments related to affordable housing projects of $ 240 and $ 180 , respectively, that are contingent on various conditions precedent to funding.

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

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

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

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

3 unchanged sentences

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 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.

As of September 30, 2024 and December 31, 2023, the Company reported $ 6 and $ 10 , respectively, within short-term investments on the Condensed Consolidated Balance Sheets representing a

Note 5 - Investments

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

receivable for the amount of cash transferred to purchase the securities.

Other Collateral Transactions

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

As of September 30, 2024 and December 31, 2023, the Company pledged collateral of $ 7 and $ 7 , respectively, of U.S.

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

2 unchanged sentences

The Company is required by law to deposit securities with government agencies in certain states in which it conducts business.

In addition, the Company is required to hold fixed maturities and short-term investments in trust for the benefit of syndicate policyholders, hold fixed maturities in a Lloyd's of London ("Lloyd's") trust account to provide a portion of the required capital, and maintain other investments primarily consisting of overseas deposits in various countries with Lloyd's to support underwriting activities in those countries.

to support underwriting activities in those countries.

Lloyd's is an insurance market-place operating worldwide.

2 unchanged sentences

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

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Fair Value Fair Value

5 unchanged sentences

Total Other Restricted Investments $ 3,599 $ 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.

8 unchanged sentences

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

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

For further information, see the Junior

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

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

5 unchanged sentences

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.

1 unchanged sentence

The Company also enters into credit default swaps to terminate existing credit default swaps, thereby offsetting the changes in value of the original swap going forward.

Note 6 - Derivatives

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Interest Rate Swaps and Futures

1 unchanged sentence

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

As of September 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

8 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 Jun 30, 2024 Dec.

31, 2023 Jun 30, 2024 Dec.

Hedge Designation/ Derivative Type Sep 30, 2024 Dec.

31, 2023 Sep 30, 2024 Dec.

Cash flow hedges

9 unchanged sentences

Credit derivatives in offsetting positions 987 998 — — 31 27 ( 31 ) ( 27 )

Equity contracts

Equity index options 404 — 5 — 5 — — —

Total non-qualifying strategies 2,382 8,269 3 ( 5 ) 37 27 ( 34 ) ( 32 )

1 unchanged sentence

Balance Sheet Location

Fixed maturities, available-for-sale $ 657 $ 645 $ — $ — $ — $ — $ — $ —

Fixed maturities, AFS $ 648 $ 645 $ — $ — $ — $ — $ — $ —

Other investments 907 1,662 31 ( 1 ) 31 18 — ( 19 )

1 unchanged sentence

Total derivatives $ 7,141 $ 12,363 $ 12 $ 7 $ 68 $ 57 $ ( 56 ) $ ( 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 June 30, 2024

As of September 30, 2024

Other investments $ 68 $ 62 $ 31 $ ( 25 ) $ — $ 6

12 unchanged sentences

Gains (Losses) Recognized in OCI

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

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

2024 2023 2024 2023

2 unchanged sentences

Total $ 2 $ ( 5 ) $ 13 $ ( 19 )

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 June 30, Six Months Ended June 30,

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

2024 2023 2024 2023

4 unchanged sentences

Total amounts presented on the Condensed Consolidated Statement of Operations $ 659 $ 49 $ 597 $ 50 $ 1,854 $ 149 $ 1,652 $ 150

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 .

As of September 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 $ 35 .

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.

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.

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

During the three and nine months ended September 30, 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 June 30, Six Months Ended June 30,

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

2024 2023 2024 2023

7 unchanged sentences

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

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

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

Credit Risk Assumed through Credit Derivatives

3 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.

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 June 30, 2024

As of September 30, 2024

Basket credit default swaps [4]

18 unchanged sentences

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

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

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

Derivative Collateral Arrangements

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

As of June 30, 2024 and December 31, 2023, the Company ha s pl edged cash collateral associated with derivative instruments of $ 26 and $ 25 , respectively .

As of September 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 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.

As of September 30, 2024 and December 31, 2023, the Company pledged securities collateral associated with derivative instruments with a fair value of $ 11 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 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 .

In addition, as of September 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 $ 10 and $ 16 , respectively, which is recorded in other investments or other assets on the Company's Condensed Consolidated Balance Sheets.

As of September 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 $ 96 and $ 112 , respectively, which are included within fixed maturities on the Company's Condensed Consolidated Balance Sheets.

As of September 30, 2024 and December 31, 2023, the Company accepted cash collateral associated with derivative instruments of $ 57 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 September 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 September 30, 2024 and December 31, 2023, the Company had no repledged securities.

In addition, as of September 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 June 30, 2024 As of December 31, 2023

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

Premiums receivable, excluding receivables for losses within a deductible and retrospectively-rated policy premiums ("loss sensitive business") $ 5,839 $ 5,303

27 unchanged sentences

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

June 30, 2024 June 30, 2023

September 30, 2024 September 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

7 unchanged sentences

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

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

September 30, 2024 September 30, 2023

11 unchanged sentences

Reinsurance recoverables include balances due from reinsurance companies and are presented net of an allowance for uncollectible reinsurance.

Reinsurance recoverables include an estimate of the amount of gross losses and loss adjustment

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

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

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

Reinsurance recoverables include

an estimate of the amount of gross losses and loss adjustment expense ("LAE") reserves that may be ceded under the terms of the reinsurance agreements, including incurred but not reported (" IBNR ") unpaid losses.

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

The Company estimates its ceded reinsurance recoverables based on the terms of any applicable facultative and treaty reinsurance, including an estimate of how IBNR losses will ultimately be ceded under reinsurance agreements.

Accordingly, the Company’s estimate of reinsurance recoverables is subject to similar risks and uncertainties as the estimate of the gross reserve for unpaid losses and loss adjustment expenses.

Reinsurance Recoverables by Credit Quality Indicator

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

As of September 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

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.

Note 8 - Reinsurance

1 unchanged sentence

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.

5 unchanged sentences

Credit ratings are reviewed on a quarterly basis and any significant changes are reflected in an updated estimate.

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

through multiple economic cycles.

Credit ratings are forward-looking and consider a variety of economic outcomes.

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

Credit ratings are forward-

looking and consider a variety of economic outcomes.

The loss given default factors are based on a study of historical recovery rates for general creditors of corporations through multiple economic cycles or, in the case of purchased annuities funding structured settlements accounted for as reinsurance, historical recovery rates for annuity contract holders.

7 unchanged sentences

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

Allowance for Uncollectible Reinsurance for the Three and Six Months Ended

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

Allowance for Uncollectible Reinsurance for the Three and Nine Months Ended

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

2024 2023 2024 2023

3 unchanged sentences

Current period provision 1 1 3 4

Current period gross write-offs ( 1 ) — ( 1 ) —

P&C ending ACL 45 46 45 46

10 unchanged sentences

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses

For the six months ended June 30,

For the nine months ended September 30,

Beginning liabilities for unpaid losses and loss adjustment expenses, gross

19 unchanged sentences

$ 35,695 $ 33,453

[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.

Prior accident year development for the nine months ended September 30, 2024 includes a $ 87 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 six months ended June 30,

For the nine months ended September 30,

Workers’ compensation $ ( 188 ) $ ( 174 )

17 unchanged sentences

Total prior accident year development $ ( 221 ) $ ( 82 )

[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.

[1] The $ 87 change in deferred gain on retroactive reinsurance for the nine months ended September 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 six months ended June 30, 2024

Re-estimates of prior accident year reserves for the nine months ended September 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 $ 48 reduction of COVID-19 related reserves driven by favorable claim count emergence.

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.

General liability reserves were increased primarily in response to higher frequency of large losses in the 2016 to 2019 accident years as well as increases in more recent accident years, with the increase in reserves for the three months ended September 30, 2024, focused more toward the recent accident years.

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

3 unchanged sentences

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 - Commercial Lines increased primarily due to adverse loss development within accident years 2022 and 2023 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.

Homeowners reserves were decreased primarily due to favorable severity impacting accident year 2023.

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

Re-estimates of prior accident year reserves for the nine months ended September 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.

3 unchanged sentences

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 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.

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

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

Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

Professional liability reserves decreased modestly due to favorable development on directors' and officers' claims for the 2019 to 2021 accident years partially offset by deterioration on errors and omissions claims primarily for the 2018 accident year.

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

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

5 unchanged sentences

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 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.

During the three and nine months ended September 30, 2024, the Company collected recoveries from NICO and as a result amortized $ 26 and $ 87 of the deferred gain within benefits, losses and loss adjustment expenses in the three and nine month periods, respectively.

As of September 30, 2024 and December 31, 2023, the deferred gain on the Navigators ADC was $ 122 and $ 209 , respectively, and is included in other liabilities on the Condensed Consolidated Balance Sheets.

Settlement Agreement with Boy Scouts of America

9 unchanged sentences

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses

For the six months ended June 30,

For the nine months ended September 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 $ 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 .

[2] Includes unallocated loss adjustment expenses ("ULAE") of $ 130 and $ 136 for the nine months ended September 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 nine months ended September 30, 2024

Group disability - Prior period reserve estimates decreased by approximately $ 394 largely driven by long-term disability claim incidence lower than prior assumptions and favorable recoveries on prior incurral year claims, as well as a favorable change in the recovery rate assumption.

Group life and accident (including group life premium waiver) - Prior period reserve estimates decreased by approximately $ 68 largely driven by favorable mortality emergence and continued low incidence in group life premium waiver.

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

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

Group disability- Prior period reserve estimates decreased by approximately $ 369 largely driven by group long-term disability claim incidence lower than prior assumptions and strong recoveries on prior incurral year claims.

6 unchanged sentences

Rollforward of Reserve for Future Policy Benefits

For the six months ended June 30,

For the nine months ended September 30,

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

17 unchanged sentences

Net Reserve for Future Policy Benefits

As of June 30,

As of September 30,

Payout Annuities $ 135 $ 128

4 unchanged sentences

Undiscounted Expected Future Gross Premiums and Benefit Payments

As of June 30,

As of September 30,

Payout Annuities [1]

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Weighted-Average Interest Rates

As of June 30,

As of September 30,

Payout Annuities

6 unchanged sentences

Current discount rate 4.7 % 5.9 %

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

The Company completed a review of cash flow assumptions in the third quarter 2024 and 2023, resulting in immaterial changes to the reserve for future policy benefits.

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

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

OTHER POLICYHOLDER FUNDS AND BENEFITS PAYABLE

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

Other policyholder funds and benefits payable of $ 613 and $ 645 as of September 30, 2024 and 2023 respectively, included universal life long-duration contacts of $ 209 and $ 226 as well as policyholder balances related to short-duration contracts of $ 404

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 six months ended June 30,

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

As of September 30, 2024 and 2023, universal life contracts of $ 208 and $ 225 , respectively, had crediting rates at their guaranteed minimums ranging from 4 %- 5 % .

Note 12 - Income Taxes

3 unchanged sentences

Income Tax Rate Reconciliation

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

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

2024 2023 2024 2023

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Rollforward of Unrecognized Tax Benefits

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

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

2024 2023 2024 2023

1 unchanged sentence

Gross increases - tax positions in current period 1 2 2 4

Gross decreases - tax positions in current period ( 1 ) — ( 1 ) —

Lapse of statute of limitations ( 4 ) — ( 4 ) ( 1 )

1 unchanged sentence

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

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

Other Tax Matters

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 June 30, 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.

3 unchanged sentences

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

Shelf Registrations

On September 23, 2024, the Company filed with the Securities and Exchange Commission an automatic shelf registration statement (Registration No.

333-282288) for the potential offering and sale of debt and equity securities.

The registration statement allows for the following types of securities to be offered:

debt securities, junior subordinated debt securities, guarantees, preferred stock, common stock, depositary shares, warrants, stock purchase contracts, and stock purchase units.

Because The Hartford is a well-known seasoned issuer, as defined in Rule 405 under the Securities Act of 1933, the registration statement became effective immediately upon filing and The Hartford may offer and sell an unlimited amount of securities under the registration statement during the three-year life of the registration statement.

Lloyd's Letter of Credit Facility

On October 21, 2024, The Hartford amended and restated its committed credit facility with a syndicate of lenders (the “Lloyd’s Facility”).

The purpose of this facility is to issue letters of credit that may be treated as Funds at Lloyd's to support underwriting capacity provided by the Hartford Corporate Underwriters Limited to the Lloyd’s syndicate 1221 for the 2025 and 2026 underwriting years of account (and prior open years).

The amended and restated Lloyd’s Facility has two tranches, with one tranche extending a $ 74 commitment and the other tranche extending a £ 79 million ($ 106 as of September 30, 2024).

The term of the facility is two years.

As of September 30, 2024, letters of credit with an aggregate face amount of $ 74 and £ 73 million, or $ 98 , were outstanding under the Lloyd's Facility.

As of December 31, 2023, letters of credit with an aggregate face amount of $ 74 and £ 79 million, or $ 101 , were outstanding under the Lloyd's Facility.

Among other covenants, the Lloyd's Facility contains financial covenants regarding The Hartford’s consolidated net worth and financial leverage.

As of September 30, 2024 and December 31, 2023, The Hartford was in compliance with all financial covenants of the facility.

Note 14 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

COMMITMENTS AND CONTINGENCIES

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

Litigation” and under the caption “Run-off Asbestos and Environmental Claims,” management expects that the ultimate liability, if any, with respect to such ordinary-course claims litigation, after consideration of provisions made for potential losses and costs of defense, will not be material to the consolidated financial condition, results of operations or cash flows of The Hartford.

Subject to the uncertainties related to sexual molestation and sexual abuse claims, including those discussed in Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of this Form 10-Q and in Note 11 - Reserve for Unpaid Losses and Loss Adjustment Expenses, of the Company's Annual Report on Form 10-K for the year ended December 31, 2023, and in the following discussion under the caption “COVID-19 Pandemic Business Income Insurance Litigation” and under the caption “Run-off Asbestos and Environmental Claims,” management expects that the ultimate liability, if any, with respect to such ordinary-course claims litigation, after consideration of provisions made for potential losses and costs of defense, will not be material to the consolidated financial condition, results of operations or cash flows of The Hartford.

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

2 unchanged sentences

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

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

Note 13 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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.

COVID-19 Pandemic Business Income Insurance Litigation

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

under commercial insurance policies issued by the Hartford Writing Companies for alleged losses resulting from the shutdown or suspension of their businesses due to the spread of COVID-19.

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

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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.

Note 14 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

Run-off Asbestos and Environmental Claims

17 unchanged sentences

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

Note 13 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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

8 unchanged sentences

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

For its Run-off A&E claims, as of 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").

For its Run-off A&E claims, as of September 30, 2024, the Company reported $ 133 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.

3 unchanged sentences

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 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.

As of September 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

Note 14 - Commitments and Contingencies

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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 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.

The aggregate fair value of all derivative instruments with credit-risk-related contingent features that are in a net liability position as of September 30, 2024 was $ 52 for which the legal entities have posted collateral of $ 36 in the normal course of business.

Based on derivative contractual terms as of September 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.

Note 14 - Equity

T HE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

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.

During the nine months ended September 30, 2024 and 2023, the Company repurchased $ 1.1 billion ( 11.0 million shares) and $ 1.05 billion ( 14.6 million shares), respectively, of common stock under the $ 3.0 billion share repurchase authorization that is effective until December 31, 2024 as authorized by the Board of Directors.

In addition to this authorization, 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.

As of September 30, 2024, the Company has $ 3.5 billion remaining for equity repurchases under both these

current share repurchase programs.

During the period October 1, 2024 through October 23, 2024, the Company repurchased $ 115 ( 1.0 million common shares) under these repurchase programs.

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 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,

Changes in AOCI, Net of Tax for the Three Months Ended September 30, 2024

Net Unrealized Gain (Loss) on Fixed Maturities, AFS Unrealized Losses on Fixed Maturities, AFS 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,

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

5 unchanged sentences

Ending balance $ ( 671 ) $ ( 5 ) $ 33 $ 41 $ 19 $ ( 1,422 ) $ ( 2,005 )

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

Note 16 - 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 Nine Months Ended September 30, 2024

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

5 unchanged sentences

Ending balance $ ( 671 ) $ ( 5 ) $ 33 $ 41 $ 19 $ ( 1,422 ) $ ( 2,005 )

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

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

Net Unrealized Gain (Loss) on Fixed Maturities, AFS

Available-for-sale fixed maturities $ ( 70 ) $ ( 77 ) Net realized gains (losses)

Fixed Maturities, AFS $ ( 50 ) $ ( 127 ) Net realized gains (losses)

( 50 ) ( 127 ) Total before tax

1 unchanged sentence

$ ( 39 ) $ ( 100 ) Net income

Unrealized Losses on Fixed Maturities, AFS with ACL

Fixed Maturities, AFS $ ( 1 ) $ ( 1 ) Net realized gains (losses)

( 1 ) ( 1 ) Total before tax

— — Income tax expense

$ ( 1 ) $ ( 1 ) Net income

Net Gain (Loss) on Cash Flow Hedging Instruments

12 unchanged sentences

Total amounts reclassified from AOCI $ ( 49 ) $ ( 123 ) Net income

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

Note 16 - 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 September 30, 2023

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

5 unchanged sentences

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

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

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

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

9 unchanged sentences

Reclassifications from AOCI

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

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

Net Unrealized Gain (Loss) on Fixed Maturities, AFS

Available-for-sale fixed maturities $ ( 21 ) $ ( 48 ) Net realized gains (losses)

Fixed Maturities, AFS $ ( 26 ) $ ( 74 ) Net realized gains (losses)

( 26 ) ( 74 ) Total before tax

1 unchanged sentence

$ ( 21 ) $ ( 58 ) Net income

Unrealized Losses on Fixed Maturities with ACL

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

Unrealized Losses on Fixed Maturities, AFS with ACL

Fixed Maturities, AFS $ ( 2 ) $ ( 4 ) Net realized gains (losses)

( 2 ) ( 4 ) Total before tax

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Total amounts reclassified from AOCI $ ( 28 ) $ ( 79 ) Net income

Note 16 - Employee Benefit Plans

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)

EMPLOYEE BENEFIT PLANS

5 unchanged sentences

Pension Benefits Other Postretirement Benefits

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

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

2024 2023 2024 2023 2024 2023 2024 2023

5 unchanged sentences

Net periodic cost (benefit) $ ( 5 ) $ ( 5 ) $ ( 14 ) $ ( 17 ) $ 1 $ 1 $ 3 $ 3

Note 18 - Restructuring and Other Costs

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

RESTRUCTURING AND OTHER COSTS

3 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 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.

Subsequent to September 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 $ 127 , before tax, and will be recognized in the Corporate category and not allocated to the reportable segments.

Restructuring and Other Costs, Before Tax

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

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

2024 2023 2024 2023

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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