27 unchanged sentences
Management believes that these ratios and measures are useful in understanding the underlying trends in The Hartford’s businesses.
−Removed: However, these key performance indicators should only be used in conjunction with, and not in lieu of, the results presented in the segment discussions that follow in this MD&A.
+Added: However, these key performance indicators should only be used in conjunction with, and not in lieu of, the results presented in the reportable segment and corporate operating summaries that follow in this MD&A.
These ratios and measures may not be comparable to other performance measures used by the Company’s competitors.
40 unchanged sentences
Reconciliation of Net Income to Core Earnings
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
10 unchanged sentences
[1] During 2024, the Company collected recoveries from National Indemnity Company ("NICO”), a subsidiary of Berkshire Hathaway Inc.
−Removed: related to the Navigators adverse development cover ("Navigators ADC") 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.
+Added: related to the Navigators adverse development cover ("Navigators ADC") 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.
For additional information regarding the ADC reinsurance agreement, refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
−Removed: [2] Primarily represents the federal income tax benefit related to before tax items not included in core earnings.
+Added: [2] Primarily represents the federal income tax expense (benefit) related to before tax items not included in core earnings.
Core Earnings Margin- The Hartford uses the non-GAAP measure core earnings margin to evaluate, and believes it is an important measure of, the Group Benefits segment's operating performance.
98 unchanged sentences
Reconciliation of Net Income to Underwriting Gain (Loss)
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
20 unchanged sentences
Net realized losses — 2 3 6
+Added: Other expense 4 — 4 —
Income tax expense 1 2 5 6
13 unchanged sentences
THE HARTFORD’S OPERATIONS
−Removed: The Hartford conducts business principally in five reporting segments including Commercial Lines, Personal Lines, Property & Casualty Other Operations, Group Benefits and Hartford Funds, as well as a Corporate category.
−Removed: The Company includes in the Corporate category reserves for run-off structured settlement and terminal funding agreement liabilities, restructuring costs, capital raising activities (including equity financing, debt financing and related interest expense), transaction expenses incurred in connection with an acquisition, certain M&A costs, purchase accounting adjustments related to goodwill and other expenses not allocated to the reporting segments.
+Added: The Hartford conducts business principally in five reportable segments including Commercial Lines, Personal Lines, Property & Casualty Other Operations, Group Benefits and Hartford Funds, as well as a Corporate category.
+Added: The Company includes in the Corporate category reserves for run-off structured settlement and terminal funding agreement liabilities, restructuring costs, capital raising activities (including equity financing, debt financing and related interest expense), transaction expenses incurred in connection with an acquisition, certain M&A costs, purchase accounting adjustments related to goodwill and other expenses not allocated to the reportable segments.
Corporate also includes investment management fees and expenses related to managing third-party assets.
25 unchanged sentences
The investment return, or yield, on invested assets is an important element of the Company’s earnings since insurance products are priced with the assumption that premiums received can be invested for a period of time before benefits, losses and loss adjustment expenses are paid.
−Removed: Due to the need to maintain sufficient liquidity to satisfy claim obligations, the majority of the Company’s invested assets have been held in available-for-sale ("AFS") securities, including, among other asset classes, corporate bonds, municipal bonds, government debt, short-term debt, mortgage-backed securities, asset-backed securities ("ABS") and collateralized loan obligations ("CLO").
+Added: Due to the need to maintain sufficient liquidity to satisfy claim obligations, the majority of the Company’s invested assets have been held in available-for-sale ("AFS") securities, including, among other asset classes, corporate bonds, municipal bonds, government debt, short-term debt, mortgage-backed securities, asset-backed securities ("ABS") and collateralized loan obligations ("CLOs").
The Company also invests in commercial mortgage loans as well as limited partnerships and alternative investments, which are private investments that are less liquid, but have the potential to generate higher returns.
4 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: SECOND QUARTER FINANCIAL HIGHLIGHTS
+Added: THIRD QUARTER FINANCIAL HIGHLIGHTS
Net Income Available to Common Stockholders Net Income Available to Common Stockholders per Diluted Share Book Value per Diluted Share
2 unchanged sentences
+ Increase in net income available to common stockholders + Net income in excess of common stockholder dividends
−Removed: + Higher favorable prior accident year development
−Removed: + Reduction in outstanding shares due to share repurchases - Dilutive effect of share repurchases
+Added: + Lower net realized losses + Reduction in outstanding shares due to share repurchases + Impact of a decrease in net unrealized losses on AFS securities in AOCI
+ Higher net investment income
−Removed: - Impact of an increase in net unrealized losses on AFS securities in AOCI
−Removed: + Improved current accident year loss and LAE ratio before catastrophes in P&C
−Removed: + Improved group life loss ratio
+Added: + Lower CAY loss and LAE ratio before catastrophes in P&C
+Added: - Dilutive effect of share repurchases
- Higher catastrophe losses in P&C
+Added: - Higher expense ratio in P&C and GB
Investment Yield, After Tax Property & Casualty Combined Ratio Group Benefits Net Income Margin
−Removed: Ý Increased 20 bps Þ Improved 2.6 points Ý Increased 2.7 points
−Removed: + A higher yield on fixed maturity securities due to reinvesting at higher rates and an increased yield on variable-rate securities - Improved current accident year loss and LAE ratio before catastrophes
−Removed: + Improved group life loss ratio
−Removed: - Higher favorable prior accident year development + The effect of higher fully insured ongoing
−Removed: - Lower returns on limited partnerships and other alternative investments
−Removed: + Higher catastrophe losses
+Added: Ý Increased 10 bps Ý Deteriorated 0.5 points Ý Increased 0.3 points
+Added: + A higher yield on fixed maturity securities due to reinvesting at higher rates + Higher catastrophe losses
+ Lower net realized losses
+Added: + Higher CAY loss and LAE ratio before catastrophes in Commercial Lines
+Added: + Improved group life loss ratio
+Added: - Lower returns on limited partnerships and other alternative investments - Higher expense ratio
+Added: - Lower CAY loss and LAE ratio before catastrophes in Personal Lines
+Added: - Higher loss ratio on supplemental health and group disability products
Index to MD&A
2 unchanged sentences
CONSOLIDATED RESULTS OF OPERATIONS
−Removed: The Consolidated Results of Operations should be read in conjunction with the Company's Condensed Consolidated Financial Statements and the related Notes as well as with the segment operating results sections of MD&A.
+Added: The Consolidated Results of Operations should be read in conjunction with the Company's Condensed Consolidated Financial Statements and the related Notes as well as with the reportable segment and corporate operating summaries within the MD&A.
Consolidated Results of Operations
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
17 unchanged sentences
Net income available to common stockholders $ 761 $ 645 18 % $ 2,242 $ 1,717 31 %
−Removed: Three months ended June 30, 2024 compared to the three months ended June 30, 2023
+Added: Three months ended September 30, 2024 compared to the three months ended September 30, 2023
Net income available to common stockholders increased by $116, primarily driven by:
−Removed: • An increase in P&C underwriting gain of $117, before tax, driven by the effect of earned premium growth, a higher level of favorable prior accident year reserve development, and a lower CAY loss and LAE ratio before catastrophes in both Personal Lines and Commercial Lines, partially offset by higher current accident year catastrophes;
−Removed: • Higher net investment income of $62, before tax, primarily driven by a higher level of invested assets and a higher yield on fixed maturities, partially offset by lower income from limited partnerships and other alternative investments;
−Removed: • In Group Benefits, improved group life loss ratio driven by lower claim severity experience and the effect of higher fully insured ongoing premiums.
−Removed: For a discussion of the Company's operating results by segment, see MD&A - Segment Operating Summaries.
+Added: • Lower net realized losses of $77, before tax;
+Added: • Higher net investment income of $62, before tax, primarily driven by a higher yield on fixed maturities and a higher level of invested assets, partially offset by lower income from limited partnerships and other alternative investments and;
+Added: • A slight increase in the P&C underwriting gain of $5, before tax, driven by the effect of earned premium growth, a lower CAY loss and LAE ratio before catastrophes in Personal Lines and a higher level of favorable prior accident year reserve development, partially offset by higher CAY catastrophe losses, a higher CAY loss and LAE ratio before catastrophes in Commercial Lines, and a higher expense ratio.
+Added: These increases were partially offset by:
+Added: • In Group Benefits, a higher expense ratio, a higher loss ratio on supplemental health products, and a higher group disability loss ratio, partially offset by a lower group life loss ratio and the effect of higher fully insured ongoing premiums.
+Added: For a discussion of the Company's operating results by segment, see MD&A - Reportable Segment and Corporate Operating Summaries.
Index to MD&A
2 unchanged sentences
Earned Premiums
−Removed: Earned premiums increased $358 primarily due to:
−Removed: • An increase in P&C reflecting a 8% increase in Commercial Lines and an 12% increase in Personal Lines.
−Removed: – Contributing to the increase in Commercial Lines was the effect of an increase in new business across all lines of business, earned pricing increases, and higher insured exposures, principally in workers’ compensation and property lines.
+Added: Earned premiums increased by $424 primarily due to:
+Added: • An increase in P&C reflecting a 10% increase in Commercial Lines and a 13% increase in Personal Lines.
+Added: – Contributing to the increase in Commercial Lines was the effect of an increase in new business across most lines of business, earned pricing increases, and higher insured exposures, principally in workers’ compensation and property lines.
– For Personal Lines, earned premium increased primarily due to the effect of earned pricing increases, partially offset by non-renewals.
• An increase in Group Benefits earned premium of 2%, including an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year periods.
−Removed: Fee income increased primarily due to a $9 increase in Hartford Funds driven by higher daily average assets resulting from an increase in equity market levels, partially offset by net outflows over the preceding twelve months.
+Added: Fee income increased primarily driven by higher daily average assets within Hartford Funds resulting from an increase in equity market levels, partially offset by net outflows over the preceding twelve months.
Net Investment Income
−Removed: Net investment income increased primarily due to a higher level of invested assets, the impact of reinvesting at higher interest rates, and a higher yield on variable-rate securities, partially offset by a lower level of income on limited partnerships and other alternative investments.
−Removed: Net realized losses improved slightly primarily due to no losses on credit derivatives in the 2024 period compared to losses in the 2023 period and gains on transactional foreign currency revaluation in the 2024 period compared to losses in the 2023 period.
−Removed: These increases were mostly offset by higher net losses on sales of fixed maturities in the 2024 period compared to the 2023 period.
+Added: Net investment income increased primarily due to the impact of reinvesting at higher interest rates and a higher level of invested assets, partially offset by a lower level of income on limited partnerships and other alternative investments.
+Added: Net realized losses improved primarily due to:
+Added: • Gains on interest rate derivatives in the 2024 period compared to losses in the 2023 period due to lower interest rates;
+Added: • Valuation improvements on equity securities in the 2024 period compared to declines in the 2023 period.
+Added: These increases were partially offset by:
+Added: • Higher net losses on sales of fixed maturities;
+Added: • Losses on transactional foreign currency revaluation in the 2024 period compared to gains in the 2023 period.
For further discussion of investment results, see MD&A - Investment Results, Net Realized Gains and MD&A - Investment Results, Net Investment Income.
6 unchanged sentences
• An increase in Property & Casualty of $265 which was attributable to:
−Removed: – An increase in P&C CAY loss and loss adjustment expenses before catastrophes of $131, before tax, primarily due to the effect of higher earned premiums, partially offset by a lower CAY loss and LAE ratio in both Commercial Lines and Personal Lines;
−Removed: – An increase in current accident year catastrophe losses of $54, before tax.
−Removed: Catastrophe losses in the 2024 period included losses from tornado, wind and hail events across several regions, but concentrated in the South and Midwest regions.
−Removed: Catastrophe losses in the 2023 period included losses from tornado, wind and hail events across several regions of the United States, mainly in the South, Midwest and Mountain West.
+Added: – An increase in P&C CAY loss and loss adjustment expenses before catastrophes of $209, before tax, primarily due to the effect of higher earned premiums and a slightly higher CAY loss and LAE ratio before catastrophes in Commercial Lines, partially offset by a lower CAY loss and LAE ratio before catastrophes in Personal Lines.
+Added: – An increase in CAY catastrophe losses of $63, before tax.
+Added: Catastrophe losses in the 2024 period included losses from hurricanes, including a loss of $104 from Hurricane Helene, and tropical storms primarily in the Southeast and South regions, and to a lesser extent, tornado, wind and hail events primarily in the Midwest, Northeast and Mountain West regions.
+Added: Catastrophe losses in the 2023 period included losses from tornado, wind and hail events across several regions of the United States and, to a lesser extent, losses from hurricanes and tropical storms in the Southeast and West Coast.
Partially offset by:
−Removed: – Net favorable prior accident year reserve development of $115, before tax, in P&C compared $39 in the prior year period.
−Removed: Favorable prior year reserve development in the 2024 period was primarily driven by decreases in reserves related to workers' compensation, catastrophes, bond, Personal Lines automobile liability, and homeowners, partially offset by increases in reserves for general liability, assumed reinsurance, and Commercial Lines automobile liability.
+Added: – Net favorable prior accident year reserve development of $50, before tax, in P&C compared to $43 in the prior year period.
+Added: Favorable prior year reserve development in the 2024 period was primarily driven by decreases in reserves related to workers' compensation and Personal Lines automobile physical damage, partially offset by increases in reserves for general liability and Commercial Lines automobile liability.
The 2024 period also included a benefit of $26 related to amortization of the Navigators ADC deferred gain.
−Removed: Prior accident year reserve development for the 2023 period was primarily driven by decreases in reserves related to catastrophes and workers’ compensation, partly offset by increases in reserves for general liability, assumed reinsurance, and bond.
+Added: Prior accident year reserve development in the 2023 period was a net favorable $43, before tax, primarily driven by decreases in reserves related to workers’
Losses and LAE Incurred for Group Benefits
+Added: compensation and package business, partly offset by an increase in reserves for general liability.
For further discussion, see Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
−Removed: • A decrease in Group Benefits of $28, before tax, primarily driven by the impact of a lower group life loss ratio and a higher New York paid family leave risk adjustment benefit, partially offset by the effect of higher earned premiums and a higher loss ratio on paid family and medical leave products.
+Added: • A slight increase in Group Benefits of $15, before tax, primarily driven by the effect of higher earned premiums, a higher loss ratio on supplemental health products, and a higher loss ratio on paid family and medical leave products, partially offset by lower group life mortality and a favorable change in the long-term disability recovery rate assumption.
Amortization of deferred policy acquisition costs increased from the prior year period driven by Commercial Lines, reflecting an increase in earned premiums across all commercial lines of business.
Insurance operating costs and other expenses increased due to:
−Removed: • Increased expense from higher staffing costs, including higher incentive compensation, and commissions in Commercial Lines and Group Benefits, partly in response to increased business volume;
+Added: • Increased expense from higher staffing costs, including higher incentive compensation and benefits costs, partly in response to increased business volume;
• Higher direct marketing costs in Personal Lines.
4 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Six months ended June 30, 2024 compared to the six months ended June 30, 2023
+Added: Nine months ended September 30, 2024 compared to the nine months ended September 30, 2023
Net income available to common stockholders increased by $525 primarily driven by:
−Removed: • An increase in P&C underwriting gain of $245, before tax, driven by the effect of earned premium growth, including a lower expense ratio, a higher level of favorable prior accident year reserve development, and lower CAY loss and LAE ratio before catastrophes in both Personal Lines and Commercial Lines, partially offset by higher current accident year catastrophe losses;
−Removed: • Higher net investment income of $140, before tax, primarily driven by a higher level of invested assets and a higher yield on fixed maturities, partially offset by lower income from limited partnerships and other alternative investments;
+Added: • An increase in P&C underwriting gain of $250, before tax, driven by the effect of earned premium growth, a higher level of favorable prior accident year reserve development, and lower CAY loss and LAE ratio before catastrophes in Personal Lines, partially offset by higher CAY catastrophe losses;
+Added: • Higher net investment income of $202, befo re tax, primarily driven by a higher yield on fixed maturities and a higher level of invested assets, partially offset by lower income from limited partnerships and other alternative investments;
• Lower net realized losses of $117, before tax;
−Removed: • In Group Benefits, a lower group life loss ratio and the effect of higher fully insured ongoing premiums, partially offset by a higher expense ratio.
−Removed: For a discussion of the Company's operating results by segment, see MD&A - Segment Operating Summaries.
+Added: • In Group Benefits, a lower group life loss ratio and the effect of higher fully insured ongoing premiums, partially offset by a higher expense ratio, a higher loss ratio on supplemental health products, and a higher group disability loss ratio.
+Added: For a discussion of the Company's operating results by segment, see MD&A - Reportable Segment and Corporate Operating Summaries.
Earned Premiums
1 unchanged sentence
• An increase in P&C reflecting a 9% increase in Commercial Lines and a 12% increase in Personal Lines.
−Removed: – Contributing to the increase in Commercial Lines was the effect of an increase in new business across all lines of business, earned pricing increases, and higher insured exposures, principally in workers’ compensation and property lines.
+Added: – Contributing to the increase in Commercial Lines was the effect of an increase in new business across most lines of business, earned pricing increases, and higher insured exposures, principally in workers’ compensation and property lines.
– For Personal Lines, earned premium increased primarily due to the effect of earned pricing increases, partially offset by non-renewals.
−Removed: • An increase in Group Benefits earned premium of 2%, including an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year periods.
Net Investment Income
−Removed: Fee income increased, primarily due to an $18 increase in Hartford Funds driven by higher daily average assets resulting from an increase in equity market levels, partially offset by net outflows over the preceding twelve months.
−Removed: Net investment income increased primarily due to a higher level of invested assets, the impact of reinvesting at higher interest rates, and a higher yield on variable-rate securities, partially offset by a lower level of income on limited partnerships and other alternative investments.
−Removed: Net realized losses improved primarily due to no losses on credit derivatives in the 2024 period compared to the 2023 period and gains on transaction foreign currency revaluation in the 2024 period compared to losses in the 2023 period.
−Removed: These increases were partially offset by higher net losses on sales of fixed maturities in the 2024 period compared to the 2023 period.
−Removed: For further discussion of investment results, see MD&A - Investment Results, Net Realized Gains and MD&A - Investment Results, Net Investment Income.
+Added: • An increase in Group Benefits earned premium of 2%, including an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year periods.
+Added: Fee income increased, primarily due to a $33 increase in Hartford Funds driven by higher daily average assets resulting from an increase in equity market levels, partially offset by net outflows over the preceding twelve months.
+Added: Net investment income increased primarily due to the impact of reinvesting at higher interest rates, a higher level of invested asset s, and, to a lesser extent, a higher yield on variable-rate securities, partially offset by a lower level of income on limited partnerships and other alternative investments.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: Net realized losses improved primarily due to:
+Added: • Gains on interest rate derivatives in the 2024 period compared to losses in the 2023 period due to lower interest rates;
+Added: • No losses on credit derivatives in the 2024 period compared to losses in the 2023 period;
+Added: • Valuation improvements on equity securities in the 2024 period compared to valuation declines and sales in the 2023 period.
+Added: These increases were partially offset by:
+Added: • Higher net losses on sales of fixed maturities.
+Added: For further discussion of investment results, see MD&A - Investment Results, Net Realized Gains and MD&A - Investment Results, Net Investment Income.
BENEFITS, LOSSES AND EXPENSES
2 unchanged sentences
• An increase in Property & Casualty of $509, which was attributable to:
−Removed: – An increase in P&C CAY loss and loss adjustment expenses before catastrophes of $346, before tax, primarily due to the effect of higher earned premiums, partially offset by a lower CAY loss and LAE ratio, in Commercial Lines and Personal Lines;
−Removed: – An increase in current accident year catastrophe losses of $30, before tax.
−Removed: Catastrophe losses in the 2024 period included losses from tornado, wind and hail events across several regions, but concentrated in the South and Midwest regions, and, to a lesser extent, from winter storms, mainly in the Northeast, Pacific and South regions.
+Added: – An increase in P&C CAY loss and loss adjustment expenses before catastrophes of $555, before tax, primarily due to the effect of higher earned premiums, partially offset by a lower CAY loss and LAE ratio in Personal Lines;
+Added: – An increase in CAY catastrophe losses of $93, before tax.
+Added: Catastrophe losses in the 2024 period included losses from tornado, wind and hail events across several regions of the United States, as well as losses from hurricanes and tropical storms mainly in the Southeast and South regions, and, to a lesser extent, from winter storms, mainly in the Pacific, Northeast, and South regions.
Catastrophe losses in the 2023 period included losses from tornado, wind and hail events across several regions of the United States, and losses from winter storms along the East and West Coasts.
2 unchanged sentences
– Net favorable prior accident year reserve development of $221, before tax, in P&C compared to net favorable prior accident year reserve development in the 2023 period of $82.
−Removed: Favorable prior year reserve development in the 2024 period was primarily driven by decreases in reserves related to workers' compensation, catastrophes, bond, Personal Lines automobile liability, and homeowners, partially offset by increases in reserves for general liability, assumed reinsurance, and Commercial Lines automobile liability.
+Added: Favorable prior year reserve development in the 2024 period was primarily driven by decreases in reserves related to workers' compensation, catastrophes, bond, Personal Lines automobile physical damage, homeowners, and Personal Lines automobile liability, partially offset by increases in reserves for general liability, Commercial Lines automobile liability, and assumed reinsurance.
The 2024 period also included a benefit of $87 related to amortization of the Navigators ADC deferred gain.
−Removed: Favorable prior year reserve development in the 2023 period was primarily driven by decreases in reserves related to workers' compensation and catastrophes, offset by increases in reserves for general liability, Personal Lines automobile physical damage, assumed reinsurance, bond, and uncollectible reinsurance.
+Added: Prior accident year reserve development in the 2023 period was a net favorable $82, before tax, primarily driven by decreases in reserves related to workers' compensation and catastrophes, offset by increases in reserves for general liability, Personal Lines automobile physical damage, assumed reinsurance and bond.
For further discussion, see Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
−Removed: • A decrease in Group Benefits of $34, before tax, primarily driven by the impact of a lower group life loss ratio, favorable long-term disability claim recoveries and incidence, and a higher New York paid family leave risk adjustment benefit, partially offset by the effect of higher earned premiums and a higher loss ratio on paid family and medical leave products.
−Removed: Amortization of deferred policy acquisition costs increased from the prior year period driven by Commercial Lines, reflecting an increase in earned premiums across all commercial lines of business.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: Partially offset by:
+Added: • A decrease in Group Benefits of $19, before tax, primarily driven by lower group life mortality, favorable long-term disability claim recoveries and incidence, and a favorable change in the long-term disability recovery rate assumption, partially offset by the effect of higher earned premiums and a higher loss ratio on paid family and medical leave products.
+Added: Amortization of deferred policy acquisition costs increased from the prior year period driven by Commercial Lines, reflecting an increase in earned premiums across all commercial lines of business.
Insurance operating costs and other expenses increased due to:
−Removed: • Increased expense from higher staffing costs, including higher incentive compensation, and commissions in Commercial Lines and Group Benefits, partly in response to increased business volume;
+Added: • Increased expense from higher staffing costs, including higher incentive compensation and benefits costs, and commissions in Group Benefits, partly in response to increased business volume;
• Higher direct marketing costs in Personal Lines.
3 unchanged sentences
Composition of Invested Assets
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Amount Percent Amount Percent
9 unchanged sentences
[1] Primarily consists of equity fund investments, overseas deposits, consolidated investment funds, and derivative instruments which are carried at fair value.
−Removed: June 30, 2024 compared to December 31, 2023
+Added: September 30, 2024 compared to December 31, 2023
Total investments increased primarily due to an increase in fixed maturities, AFS, at fair value.
−Removed: Fixed maturities, AFS, at fair value increased primarily due to net additions of corporate bonds and securitized products, partially offset by net reductions to tax-exempt municipal bonds and U.S.
−Removed: treasuries, as well as an overall decrease in valuations due to higher interest rates.
+Added: Fixed maturities, AFS, at fair value increased primarily due to net additions of corporate bonds, high-quality residential mortgage-backed securities ("RMBS") and CLOs, partially offset by net reductions to U.S.
+Added: treasuries, tax-exempt municipal bonds, and commercial mortgage-backed securities ("CMBS").
+Added: The increase was also due to higher valuations as a result of lower interest rates and tighter credit spreads.
Net Investment Income
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
14 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Total net investment income increased primarily due to a higher level of invested assets, the impact of reinvesting at higher rates, and a higher yield on variable-rate securities, partially offset by lower income from limited partnerships and other alternative investments.
−Removed: Annualized net investment income yield, excluding limited partnerships and other alternative investments, was up primarily due to the impact of reinvesting at higher rates and a higher yield on variable-rate securities.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Total net investment income increased primarily due to the impact of reinvesting at higher interest rates and a higher level of invested assets, partially offset by a lower level of income on limited partnerships and other alternative investments.
+Added: Annualized net investment income yield, excluding limited partnerships and other alternative investments, was up primarily due to the impact of reinvesting at higher rates.
Average reinvestment rates, on fixed maturities and mortgage loans, excluding certain U.S.
Treasury securities, for
−Removed: the three and six months ended June 30, 2024 were 6.4% and 6.2%, respectively, which were above the average yield of sales and maturities of 4.9% and 4.9%, respectively.
−Removed: Average reinvestment rates for the three and six months ended June 30, 2023, were 5.3% and 5.6%, respectively, which were above the average yield of sales and maturities of 4.1% and 4.1%, respectively.
+Added: the three and nine months ended September 30, 2024, were 5.5% and 6.0%, respectively, which were above the average yield of sales and maturities of 4.4% and 4.7%, respectively.
+Added: Average reinvestment rates for the three and nine months ended September 30, 2023, were 6.0% and 5.7%, respectively, which were above the average yield of sales and maturities of 4.5% and 4.2%, respectively.
For the 2024 calendar year, we expect the annualized net investment income yield, excluding limited partnerships and other alternative investments, to be above the portfolio yield earned in 2023 due to the higher rate environment.
1 unchanged sentence
Net Realized Gains (Losses)
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
(Before tax) 2024 2023 2024 2023
6 unchanged sentences
Net realized losses $ (13) $ (90) $ (44) $ (161)
−Removed: [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.
−Removed: The change in net unrealized gains (losses) on equity securities still held as of June 30, 2023 and included in net realized gains (losses) were $7 and $7 for the three and six months ended June 30, 2023, respectively.
+Added: [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.
+Added: 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] See Credit Losses on Fixed Maturities, AFS and Intent-to-Sell Impairments within the Investment Portfolio Risks and Risk Management section of the MD&A.
[3] See ACL on Mortgage Loans within the Investment Portfolio Risks and Risk Management section of the MD&A.
−Removed: [4] For the three 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.
−Removed: 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.
−Removed: Three and six months ended June 30, 2024
+Added: [4] 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.
+Added: 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.
+Added: Three and nine months ended September 30, 2024
Gross gains and losses on sales were primarily due to sales of U.S.
1 unchanged sentence
Equity securities net gains were primarily driven by an increase in value due to higher equity market levels.
−Removed: Other, net losses for the three and six month periods ended June 30, 2024 primarily included losses of $6 and $3, respectively, on interest rate derivatives driven by changes in interest rates, and gains of $4 and $6, respectively, on transactional foreign currency revaluation.
−Removed: Also included for the six month period ended June 30, 2024 were losses of $5 on equity derivatives due to higher equity market levels.
−Removed: Three and six months ended June 30, 2023
+Added: Other, net gains for the three and nine month periods ended September 30, 2024 primarily included gains of $12 and $9, respectively, on interest rate derivatives driven by changes in interest rates, gains of $11 and $6 on equity derivatives driven by changes in equity market levels, and losses of $11 and $5, respectively, on transactional foreign currency revaluation.
+Added: Three and nine months ended September 30, 2023
Gross gains and losses on sales were primarily due to sales of corporate securities and tax-exempt municipals, in addition to sales of U.S.
treasuries for duration and/or liquidity management.
−Removed: Equity securities net gains were primarily driven by an increase in value due to higher equity market levels.
−Removed: Other, net losses for the three and six month periods ended June 30, 2023 primarily included losses of $36 and $52, respectively, on credit derivatives primarily due to changes in valuation, and losses of $9 and $16, respectively, on transactional foreign currency revaluation.
−Removed: Also included for the six month period ended June 30, 2023 were losses of $11 on FVO securities due to changes in credit spreads and gains of $18 on interest rate derivatives driven by an increase in interest rates.
+Added: Equity securities net losses for the three month period ended September 30, 2023 were primarily driven by a decline in value due to lower equity market levels.
+Added: Equity securities net gains for the nine month period ended September 30, 2023 were primarily driven by an increase in value due to higher equity market levels.
+Added: Other, net losses for the three and nine month periods ended September 30, 2023 primarily included losses of $71 and $53, respectively, on interest rate derivatives driven by an increase in interest rates and losses of $3 and $55, on credit derivatives primarily due to changes in valuations.
+Added: Also included for the three month period ended September 30, 2023 were gains of $16 on FVO securities due to changes in credit spreads and gains of $13 on transactional foreign currency revaluation.
Index to MD&A
16 unchanged sentences
In addition, - Note 1 - Basis of Presentation and Significant Accounting Policies of Notes to Consolidated Financial Statements included in the Company's 2023 Form 10-K Annual Report should be read in conjunction with this section to assist with obtaining an understanding of the underlying accounting policies related to these estimates.
−Removed: The following discussion updates certain of the Company’s critical accounting estimates as of June 30, 2024.
+Added: The following discussion updates certain of the Company’s critical accounting estimates as of September 30, 2024.
| PROPERTY & CASUALTY INSURANCE PRODUCT RESERVES, NET OF REINSURANCE
−Removed: P&C Loss and Loss Adjustment Expense Reserves, Net of Reinsurance, by Segment as of June 30, 2024
+Added: P&C Loss and Loss Adjustment Expense Reserves, Net of Reinsurance, by Segment as of September 30, 2024
Based on the results of the quarterly reserve review process, the Company determines the appropriate reserve adjustments, if any, to record.
10 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Six Months Ended June 30, 2024
+Added: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Nine Months Ended September 30, 2024
Commercial Lines Personal
25 unchanged sentences
Prior accident year development (pts) [3]
−Removed: [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 ADC as the Company began collecting recoveries of the ceded losses from NICO during the period.
+Added: [1] 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 ADC as the Company began collecting recoveries of the ceded losses from NICO during the period.
For additional information regarding the Navigators ADC reinsurance agreement, refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
2 unchanged sentences
Current Accident Year Catastrophe Losses, Net of Reinsurance
−Removed: Three Months Ended June 30, 2024 Six Months Ended June 30, 2024
+Added: Three Months Ended September 30, 2024 Nine Months Ended September 30, 2024
Lines Personal
3 unchanged sentences
Winter storms (3) (1) (4) 52 13 65
+Added: Hurricanes and tropical storms [1] 100 61 161 100 61 161
Wildfires — — — 1 10 11
3 unchanged sentences
Total catastrophe losses $ 155 $ 92 $ 247 $ 419 $ 269 $ 688
+Added: [1] For the three and nine months ended September 30, 2024, included losses from Hurricane Helene of $104, net of reinsurance, with $8 of the losses in the global assumed reinsurance business.
[2] Catastrophe losses incurred on global assumed reinsurance business are not covered under the Company's aggregate property catastrophe treaty.
For further information on the treaty, refer to Enterprise Risk Management — Insurance Risk section of this MD&A.
+Added: Hurricane Milton made landfall in Florida on October 9, 2024, and taking into consideration the reported claim volume to date, the Company’s preliminary loss estimate for the fourth quarter of 2024 is a range of $65 to $110, net of reinsurance and before tax.
Index to MD&A
2 unchanged sentences
Unfavorable (Favorable) Prior Accident Year Development for the
−Removed: Three Months Ended June 30, 2024
+Added: Three Months Ended September 30, 2024
Commercial Lines Personal
7 unchanged sentences
Professional liability — — — —
−Removed: Bond (22) — — (22)
Assumed reinsurance — — — —
10 unchanged sentences
$ (36) $ (14) $ — $ (50)
−Removed: [1] Other reserve re-estimates, net for the three months ended June 30, 2024 includes a $7 decrease in personal lines automobile physical damage reserves.
−Removed: [2] The $37 change in deferred gain on retroactive reinsurance for the three months ended June 30, 2024, is related to amortization of the Navigators ADC deferred gain under retroactive reinsurance accounting.
+Added: [1] Other reserve re-estimates, net for the three months ended September 30, 2024 includes a $10 decrease in personal lines automobile physical damage reserves.
+Added: [2] The $26 change in deferred gain on retroactive reinsurance for the three months ended September 30, 2024, is related to amortization of the Navigators ADC deferred gain under retroactive reinsurance accounting.
For additional information regarding the Navigators ADC reinsurance agreement, refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
3 unchanged sentences
Unfavorable (Favorable) Prior Accident Year Development for the
−Removed: Six Months Ended June 30, 2024
+Added: Nine Months Ended September 30, 2024
Commercial Lines Personal
18 unchanged sentences
Total prior accident year development $ (173) $ (55) $ 7 $ (221)
−Removed: [1] Other reserve re-estimates, net for the six months ended June 30, 2024 includes a $14 decrease in personal lines automobile physical damage reserves.
−Removed: [2] 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 under retroactive reinsurance accounting.
+Added: [1] Other reserve re-estimates, net for the nine months ended September 30, 2024 includes a $24 decrease in personal lines automobile physical damage reserves.
+Added: [2] 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 under retroactive reinsurance accounting.
For additional information regarding the Navigators ADC reinsurance agreement, refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
2 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Six Months Ended June 30, 2023
+Added: Rollforward of Property and Casualty Insurance Product Liabilities for Unpaid Losses and LAE for the Nine Months Ended September 30, 2023
Lines Personal
20 unchanged sentences
Current Accident Year Catastrophe Losses, Net of Reinsurance
−Removed: Three Months Ended June 30, 2023 Six Months Ended June 30, 2023
+Added: Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023
Lines Total Commercial
1 unchanged sentence
Winter storms (8) — (8) 68 15 83
+Added: Hurricanes and tropical storms 13 7 20 13 7 20
+Added: Wildfires 4 8 12 4 8 12
+Added: Other international 2 — 2 2 — 2
Catastrophes before assumed reinsurance 94 69 163 323 219 542
7 unchanged sentences
Unfavorable (Favorable) Prior Accident Year Development for the
−Removed: Three Months Ended June 30, 2023
+Added: Three Months Ended September 30, 2023
Commercial Lines Personal
7 unchanged sentences
Professional liability — — — —
−Removed: Bond 12 — — 12
Assumed reinsurance 2 — — 2
8 unchanged sentences
Unfavorable (Favorable) Prior Accident Year Development for the
−Removed: Six Months Ended June 30, 2023
+Added: Nine Months Ended September 30, 2023
Commercial Lines Personal
16 unchanged sentences
Total prior accident year development $ (107) $ 18 $ 7 $ (82)
−Removed: [1] Other reserve re-estimates, net for the six months ended June 30, 2023 includes a $22 increase in personal automobile physical damage reserves.
+Added: [1] Other reserve re-estimates, net for the nine months ended September 30, 2023 includes a $22 increase in personal automobile physical damage reserves.
For discussion of the factors contributing to unfavorable (favorable) prior accident year reserve development for both the 2024 and 2023 periods, please refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
2 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: SEGMENT OPERATING SUMMARIES
+Added: REPORTABLE SEGMENT AND CORPORATE OPERATING SUMMARIES
| COMMERCIAL LINES - RESULTS OF OPERATIONS
Underwriting Summary
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
15 unchanged sentences
Net realized losses [2] (32) (38) 16 % (70) (108) 35 %
−Removed: Other income (expense) [3] (1) — NM (3) — NM
+Added: Other income (expense) [3] (1) 2 (150 %) (4) 2 NM
Income before income taxes 662 649 2 % 2,034 1,737 17 %
9 unchanged sentences
Premium Measures
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
16 unchanged sentences
[2] Excludes Global Re and is before ceded reinsurance.
−Removed: [3] Excludes Global Re, offshore energy policies, credit and political risk insurance policies , political violence and terrorism ("PV&T") policies, and any business under which the managing agent of our Lloyd's Syndicate delegates underwriting authority to coverholders and other third parties.
+Added: [3] Excludes Global Re, offshore energy policies, credit and political risk insurance ("CPRI") policies , political violence and terrorism ("PV&T") policies, and any business under which the managing agent of our Lloyd's Syndicate delegates underwriting authority to coverholders and other third parties.
Underwriting Ratios
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
12 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Net income for the three and six months ended June 30, 2024 increased primarily due to a higher underwriting gain, higher net investment income, and, for the six month period, lower net realized losses.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Net income for the three months ended September 30, 2024 increased primarily due to higher net investment income and lower net realized losses, partially offset by a lower underwriting gain.
+Added: Net income for the nine month period increased primarily due to a higher underwriting gain, higher net investment income and lower net realized losses.
For further discussion of investment results, see MD&A - Investment Results.
Underwriting Gain
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Underwriting gain for the three and six months ended June 30, 2024 increased due to the effect of earned premium growth, higher favorable prior accident year development, including $37 and $61 of a benefit for amortization of a deferred gain on the Navigators ADC for the three and six month periods, respectively, and a lower CAY loss and LAE ratio before catastrophes, partially offset by higher current accident year catastrophe losses.
−Removed: Expense ratio for the three and six months ended June 30, 2024 decreased driven by the impact of higher earned premium, partially offset by higher underwriting staffing costs, including higher incentive compensation, and increased commissions.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Underwriting gain for the three months ended September 30, 2024 decreased due to higher CAY catastrophe losses, a higher CAY loss and LAE ratio before catastrophes and less favorable prior accident year development, including $26 of a benefit for amortization of a deferred gain on the Navigators ADC in the current year period, partially offset by the effect of earned premium growth.
+Added: Underwriting gain for the nine month period increased due to the effect of earned premium growth and higher favorable prior accident year development, including $87 of a benefit for amortization of a deferred gain on the Navigators ADC in the current year period, partially offset by higher CAY catastrophe losses.
+Added: Expense ratio for the three months ended September 30, 2024 increased driven by higher staffing costs, including higher incentive compensation and benefits costs, partially offset by the impact of higher earned premium.
+Added: Expense ratio for the nine month period was flat as the impact of higher earned premium was offset by higher staffing costs, including higher incentive compensation and benefits costs.
Index to MD&A
2 unchanged sentences
Earned Premiums
−Removed: [1] Other earned premiums of $13 and $14, for the three months ended June 30, 2023, and 2024, respectively and $26 and $29 , for the six months ended June 30, 2023, and 2024, respectively.
+Added: [1] Other earned premiums of $14 and $14, for the three months ended September 30, 2023, and 2024, respectively and $40 and $43 , for the nine months ended September 30, 2023, and 2024, respectively.
Written Premiums
−Removed: [1] Other written premiums of $13 and $14 for the three months ended June 30, 2023, and 2024, respectively and $26 and $28 for the six months ended June 30, 2023 and 2024, respectively.
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Earned premiums for the three and six months ended June 30, 2024 increased due to written premium increases over the prior twelve months, including the effect of higher insured exposures, principally in workers’ compensation and property lines.
−Removed: Written premiums for the three and six months ended June 30, 2024 increased driven by growth across small commercial, middle & large commercial and global specialty.
+Added: [1] Other written premiums of $14 and $14 for the three months ended September 30, 2023, and 2024, respectively and $40 and $42 for the nine months ended September 30, 2023 and 2024, respectively.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Earned premiums for the three and nine months ended September 30, 2024 increased due to written premium increases over the prior twelve months, including the effect of higher insured exposures, principally in workers’ compensation and property lines.
+Added: Written premiums for the three and nine months ended September 30, 2024 increased driven by growth across small commercial, middle & large commercial and global specialty.
• Small commercial written premium increased driven by double-digit new business growth, renewal written price increases in all lines and higher insured exposures.
2 unchanged sentences
Written premium grew in nearly all lines across industry verticals, specialty markets, general industries and large property.
−Removed: • Global specialty written premium increased driven by written price increases across almost all lines as well as an increase in gross new business, primarily in wholesale.
+Added: • Global specialty written premium increased driven by written price increases across almost all lines as well as an increase in gross new business, primarily in casualty lines.
Written premiums grew across most U.S.
lines, global reinsurance and international lines.
−Removed: Renewal written price increases were recognized in nearly all lines in both the three and six month periods, with price increases across most lines other than directors and officers ("D&O").
−Removed: • In small commercial, renewal written price increases were higher in 2024, with double-digit price increases in package business, automobile and excess and surplus lines.
−Removed: Workers' compensation pricing was slightly positive, but moderated from 2023 due to lower net rates and lower wage inflation.
−Removed: • In middle market, the Company recognized high single-digit to mid-teens price increases in most lines other than workers’ compensation, which was positive due to the effect of wage inflation offset by lower net rates.
+Added: Renewal written price increases were recognized in nearly all lines in both the three and nine month periods, with price increases across most lines other than directors and officers ("D&O").
+Added: • In small commercial, renewal written price increases were higher in 2024, with accelerating year to date double-digit price increases in package business and automobile and moderating double-digit price increases in excess and surplus lines.
+Added: Workers' compensation pricing year to date was slightly positive and consistent with 2023.
+Added: • In middle market, renewal written price increases were generally flat to 2023, with year to date high single-digit to low double-digit price increases in most lines other than workers’ compensation, which was slightly positive.
+Added: Property pricing has moderated from elevated levels in 2023 while automobile pricing has accelerated.
• In global specialty, U.S.
5 unchanged sentences
Current Accident Year Loss and LAE Ratio before Catastrophes
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Current accident year loss and LAE ratio before catastrophes for the three and six months ended June 30, 2024 improved primarily due to lower net non-catastrophe property losses.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Current accident year loss and LAE ratio before catastrophes for the three and nine months ended September 30, 2024 deteriorated primarily due to a higher general liability loss ratio, partially offset by lower net non-catastrophe property losses.
Catastrophes and Unfavorable (Favorable) Prior Accident Year Development
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Current accident year catastrophe losses for the three and six months ended June 30, 2024 included losses from tornado, wind and hail events across several regions, but concentrated in the South and Midwest regions, and for the six month period, winter storms primarily in the Northeast, Pacific and South regions.
−Removed: Current accident year catastrophe losses for the three and six months ended June 30, 2023 included losses from tornado, wind and hail events across several regions of the United States and, for the six month period, winter storms primarily on the East and West coasts.
−Removed: Prior accident year development was net favorable for the three and six months ended June 30, 2024 and included reserve decreases for workers' compensation, catastrophes and bond, partially offset by reserve increases for general liability, assumed reinsurance and automobile liability.
−Removed: Also included are benefits of $37 and $61 related to amortization of the Navigators ADC deferred gain for the three and six month periods, respectively.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Current accident year catastrophe losses for the three months ended September 30, 2024 included losses from hurricanes, including a loss of $55 from Hurricane Helene, and tropical storms primarily in the Southeast and South regions and, to a lesser extent, tornado, wind and hail events primarily in the Midwest and Northeast regions.
+Added: Current accident year catastrophe losses for the nine month period included losses from tornado, wind and hail events across several regions of the United States, hurricanes and tropical storms primarily in the Southeast and South regions and, to a lesser extent, winter storms mainly in the Pacific, Northeast and South regions.
+Added: Current accident year catastrophe losses for the three months ended September 30, 2023 included losses from tornado, wind and hail events across several regions of the United States, and to a lesser extent, losses from hurricanes and tropical storms.
+Added: Current accident year catastrophe losses for the nine months ended September 30, 2023 included losses from tornado, wind and hail events across several regions of the United States, and losses from winter storms along the East and West coasts.
+Added: Prior accident year development was net favorable for the three and nine months ended September 30, 2024 and included reserve decreases for workers' compensation and, for the nine month period, catastrophes and bond, partially offset by reserve increases for general liability, automobile liability and, for the nine month period, assumed reinsurance.
+Added: Also included are benefits of $26 and $87 related to amortization of the Navigators ADC deferred gain for the three and nine month periods, respectively.
For additional information regarding the ADC reinsurance agreement, refer to Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
−Removed: Prior accident year development was net favorable for the three and six months ended June 30, 2023 and included reserve decreases for workers' compensation and catastrophes, partially offset by reserve increases for general liability, assumed reinsurance and bond.
+Added: Prior accident year development was net favorable for the three and nine months ended September 30, 2023 and included reserve decreases for workers' compensation and package business, partially offset by reserve increases for general liability and assumed reinsurance.
+Added: In addition, the nine month period included a reserve decrease for catastrophes.
Index to MD&A
3 unchanged sentences
Underwriting Summary
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
15 unchanged sentences
Net servicing and other income (expense) [3] 5 3 67 % 15 16 (6) %
−Removed: Income (loss) before income taxes (15) (77) 81 % 27 (79) NM
−Removed: Income tax expense (benefit) [4] (4) (17) 76 % 4 (18) NM
−Removed: Net income (loss) $ (11) $ (60) 82 % $ 23 $ (61) NM
+Added: Income (loss) before income taxes 39 (17) NM 66 (96) NM
+Added: Income tax expense (benefit) [4] 8 (5) NM 12 (23) NM
+Added: Net income (loss) $ 31 $ (12) NM $ 54 $ (73) NM
[1] For additional information on current accident year catastrophes and prior accident year development, see MD&A - Critical Accounting Estimates, Property & Casualty Insurance Product Reserves, Net of Reinsurance and Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.
[2] For discussion of consolidated investment results, see MD&A - Investment Results.
−Removed: [3] Includes servicing revenues of $25 and $24 for the three months ended June 30, 2024 and 2023, respectively, and $44 and $43 for the six months ended June 30, 2024 and 2023, respectively.
−Removed: Includes servicing expenses of $18 and $16 for the three months ended June 30, 2024 and 2023, respectively, and $33 and $30 for the six months ended June 30, 2024 and 2023, respectively.
+Added: [3] Includes servicing revenues of $22 and $21 for the three months ended September 30, 2024 and 2023, respectively, and $66 and $64 for the nine months ended September 30, 2024 and 2023, respectively.
+Added: Includes servicing expenses of $18 and $17 for the three months ended September 30, 2024 and 2023, respectively, and $51 and $47 for the nine months ended September 30, 2024 and 2023, respectively.
[4] For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
Written and Earned Premiums
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
Written Premiums 2024 2023 Change 2024 2023 Change
10 unchanged sentences
Premium Measures
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
Premium Measures 2024 2023 2024 2023
18 unchanged sentences
Underwriting Ratios
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
Underwriting Ratios 2024 2023 Change 2024 2023 Change
9 unchanged sentences
Product Combined Ratios
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
7 unchanged sentences
Net Income (Loss)
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Net loss decreased for the three months ended June 30, 2024, largely driven by improved underwriting results and an increase in net investment income.
−Removed: Net income changed to a net gain for the six months ended June 30, 2024 compared to a net loss for the prior year period, largely driven by improved underwriting results and an increase in net investment income.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Net Income changed to a net gain for both the three and nine months ended September 30, 2024 compared to a net loss for the prior year periods, largely driven by improved underwriting results and an increase in net investment income.
Underwriting Loss
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Underwriting loss decreased for the three and six months ended June 30, 2024 driven by the effect of an increase in earned premium due to renewal written price increases and a decrease in the CAY loss and LAE ratio before catastrophes, partially offset by an increase in current accident year catastrophe losses and an increase in direct marketing costs.
−Removed: The three month period also benefited from an increase in favorable prior accident year development.
−Removed: The six month period benefited from a change from unfavorable to favorable prior accident year development.
−Removed: Expense ratio increased in the three month period primarily due an increase in direct marketing costs, partially offset by the impact of higher earned premium driven by earned pricing increases.
−Removed: The expense ratio in the six month period decreased primarily due to the impact of higher earned premium driven by earned pricing increases, partially offset by an increase in direct marketing costs.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Underwriting loss decreased for the three and nine months ended September 30, 2024 driven by a decrease in the CAY loss and LAE ratio before catastrophes, the effect of an increase in earned premium due to renewal written price increases, and a change from unfavorable to favorable prior accident year development, partially offset by an increase in current accident year catastrophe losses, and an increase in underwriting expenses.
+Added: Expense ratio increased in the three month period primarily due to an increase in direct marketing costs, higher commissions, and higher incentive compensation and benefits costs, partially offset by the impact of higher earned premium driven by earned pricing increases.
+Added: For the nine month period, the increase was primarily due to higher commissions, higher direct marketing costs, and higher incentive compensation and benefits costs, partially offset by the impact of higher earned premium.
Index to MD&A
3 unchanged sentences
Written Premiums
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Earned premiums increased in both the three and six month periods due to higher written premium over the prior twelve months in both automobile and homeowners.
−Removed: Written premiums increased in both the three and six month periods driven by the effect of written pricing increases and by an increase in new premium in both automobile and homeowners.
−Removed: Renewal written pricing increases were higher for both automobile and homeowners in the three and six month periods, primarily in response to recent elevated loss cost trends as well as higher insured values in homeowners.
−Removed: Policy count retention decreased in automobile, and was stable for homeowners for both the three and six month periods.
−Removed: Effective Policy count retention decreased both for automobile and for homeowners in the three and six month periods in response to renewal written pricing increases.
−Removed: Policies in-force declined for both automobile and homeowners, reflecting the level of new business in relation to non-renewed policies.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Earned premiums increased in both the three and nine month periods due to higher written premium over the prior twelve months in both automobile and homeowners.
+Added: Written premiums increased in both the three and nine month periods driven by the effect of written pricing increases and by an increase in new premium in both automobile and homeowners.
+Added: Renewal written pricing increases were higher for both automobile and homeowners in the three and nine month periods, primarily in response to recent elevated loss cost trends as well as higher insured values in homeowners.
+Added: Policy count retention decreased both for automobile and for homeowners in the three month period, and decreased for automobile and was stable for homeowners in the nine month period, in response to renewal written pricing increases.
+Added: Effective Policy count retention decreased for automobile and was stable for homeowners in the three month period, and decreased both for automobile and homeowners in the nine month period, in response to renewal written pricing increases.
+Added: Policies in-force as of September 30, 2024 declined since September 30, 2023 for both automobile and homeowners, reflecting the level of new business in relation to non-renewed policies.
Index to MD&A
2 unchanged sentences
Current Accident Year Loss and LAE Ratio before Catastrophes
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Current accident year Loss and LAE ratio before catastrophes decreased both in automobile and in homeowners in both the three and six month periods.
−Removed: The decrease in automobile was primarily due to the impact of earned pricing increases, partially offset by an increase in automobile liability and physical damage claim severity, in line with expectations.
−Removed: The automobile severity increases continue to include the inflationary effects on bodily injury claims and automobile parts and repairs, and also include higher attorney representation rates for liability claims.
−Removed: For homeowners, the decrease in the CAY loss and LAE ratio before catastrophes was due to a decrease in frequency for both weather and non-weather claims, as well as the impact of earned pricing increases, partially offset by an increase in severity for both weather and non-weather claims.
−Removed: Contributing to the increase in homeowners severity was the effect of higher rebuilding costs due to inflation.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Current accident year Loss and LAE ratio before catastrophes decreased in automobile and homeowners for both the three and nine month periods.
+Added: The decrease in automobile was primarily due to the impact of earned pricing increases as well as lower physical damage claim frequency, partially offset by higher automobile claim severities.
+Added: The automobile physical damage claim severity trend has moderated from the prior year.
+Added: The automobile liability severity increases continue to recognize the inflationary effects and higher attorney representation rates on bodily injury claims.
+Added: For homeowners, the decrease in the CAY loss and LAE ratio before catastrophes was primarily due to the impact of earned pricing increases and lower claim frequency, partially offset by higher claim severities.
+Added: Contributing to the higher homeowners severity was the effect of higher rebuilding costs.
Current Accident Year Catastrophes and Unfavorable (Favorable) Prior Accident Year Development
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Current accident year catastrophe losses increased for both the three and six months ended June 30, 2024, compared to the prior year.
−Removed: Current accident year catastrophe losses for 2024 included tornado, wind and hail events, mainly in the Midwest and South regions, as well as winter storms in the Pacific and South regions.
−Removed: Current accident year catastrophe losses for the three months ended June 30, 2023 included tornado, wind and hail events across several regions of the United States, and for the six month period, included losses from winter storms primarily on the East and West coasts.
−Removed: Prior accident year development was favorable for the three and six months ended June 30, 2024, primarily driven by lower estimated severity on automobile physical damage, automobile liability, and homeowners.
−Removed: Net favorable prior accident year development for the three months ended June 30, 2023 was primarily driven by a reduction in prior accident year catastrophes.
−Removed: Net unfavorable prior accident year development in the six month period was primarily driven by automobile physical damage.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Current accident year catastrophe losses increased for both the three and nine months ended September 30, 2024, compared to the prior year.
+Added: CAY catastrophe losses for the three months ended September 30, 2024 included losses from hurricanes and tropical storms, primarily in the Southeast region, including a loss of $49 for Hurricane Helene, and to a lesser extent, tornado, wind and hail events, mainly in the Midwest, Mountain West and Northeast regions.
+Added: CAY catastrophe losses for the nine months ended September 30, 2024 included losses from tornado, wind and hail events in several regions of the United States, and to a lesser extent, from hurricanes and tropical storms primarily in the Southeast region.
+Added: CAY catastrophe losses for the three months ended September 30, 2023 included tornado, wind and hail events across several regions of the United States, and to a lesser extent, wildfire events and hurricanes and tropical storms.
+Added: The nine month period also included losses from winter storms primarily on the East and West coasts.
+Added: Prior accident year development was favorable for the three and nine months ended September 30, 2024, primarily driven by lower estimated severity on automobile physical damage and homeowners, and for the nine month period, automobile liability.
+Added: Prior accident year development was an unfavorable $1 in the three months ended September 30, 2023.
+Added: Net unfavorable prior accident year development in the nine months ended September 30, 2023 was primarily driven by automobile physical damage.
Index to MD&A
4 unchanged sentences
Underwriting Summary
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
5 unchanged sentences
Net investment income [2] 18 18 — % 55 51 8 %
−Removed: Net realized losses [2] (3) (1) NM (3) (4) 25 %
+Added: Net realized gains (losses) [2] — (2) 100 % (3) (6) 50 %
+Added: Other expenses (4) — NM (4) — NM
Income before income taxes 11 11 — % 34 30 13 %
4 unchanged sentences
[3] For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Net income increased in the three months ended June 30, 2024, primarily due to a lower underwriting loss and higher net investment income, partially offset by an increase in net realized losses.
−Removed: Net income increased in the six months ended June 30, 2024, primarily due to higher net investment income, and slightly lower net realized losses, partially offset by a greater underwriting loss.
−Removed: Underwriting loss decreased in the three months ended June 30, 2024, primarily due to unfavorable prior accident year reserve development in the 2023 period.
−Removed: Underwriting loss increased slightly in the six months ended June 30, 2024 due to higher unfavorable prior accident year reserve development in the 2024 period primarily related to an increase in reserves for uncollectible reinsurance, partially offset by a decrease in underwriting expenses.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Net income increased in the three months ended September 30, 2024 , primarily due to a lower underwriting loss and no net realized gains or losses in the 2024 period compared to net realized losses in the 2023 period.
+Added: Net income increased in the nine months ended September 30, 2024 , primarily due to higher net investment income and lower net realized losses.
+Added: The increases to net income in both periods were partially offset by an increase in other expense relating to a one-time contract settlement charge on a claims servicing arrangement.
+Added: Underwriting loss decreased in the three months ended September 30, 2024 , primarily due to unfavorable prior accident year reserve development in the 2023 period.
+Added: Underwriting loss decreased slightly in the nine months ended September 30, 2024 due to a decrease in underwriting expenses.
Asbestos and environmental reserve comprehensive annual reviews will occur in the fourth quarter of 2024.
5 unchanged sentences
Operating Summary
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
1 unchanged sentence
Net investment income [1] 119 121 (2 %) 345 344 — %
−Removed: Net realized losses [1] (9) (19) 53 % (8) (14) 43 %
+Added: Net realized gains (losses) [1] — (31) 100 % (8) (45) 82 %
Total revenues 1,774 1,719 3 % 5,296 5,167 2 %
10 unchanged sentences
Premiums and Other Considerations
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
Fully insured – ongoing premiums $ 1,600 $ 1,569 2 % $ 4,792 $ 4,700 2 %
−Removed: Buyout premiums 1 — NM 1 1 — %
+Added: Buyout premiums — 6 (100 %) 1 7 (86) %
Fee income 55 54 2 % 166 161 3 %
2 unchanged sentences
Ratios, Excluding Buyouts
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
6 unchanged sentences
group life and disability business are not included in the expense ratio.
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
1 unchanged sentence
Adjustments to reconcile net income margin to core earnings margin:
−Removed: Net realized gains, before tax 0.4 % 0.8 % (0.4) 0.3 % 0.2 % 0.1
+Added: Net realized gains (losses), before tax (0.1 %) 1.5 % (1.6) 0.2 % 0.8 % (0.6)
Integration and other non-recurring M&A costs, before tax — % 0.1 % (0.1) — % 0.1 % (0.1)
4 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Net income increased in the three and six months ended June 30, 2024, primarily due to a lower group life loss ratio, higher fully insured ongoing premiums, and lower net realized losses.
−Removed: For the six month period, these increases were partially offset by a higher expense ratio.
−Removed: Insurance operating costs and other expenses were higher for both the three and six month periods, prim arily due to the effect of higher earned premium, including higher staffing costs and commissions, as well as higher incentive compensation, partially offset by an increase in the allowance for credit losses on premiums receivable in the 2023 period.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Net income increased in the three and nine months ended September 30, 2024 , primarily due to a lower group life loss ratio and higher fully insured ongoing premiums, partially offset by a higher expense ratio , a higher loss ratio on supplemental health products, and a higher group disability loss ratio.
+Added: In addition, the three months ended September 30, 2024, benefitted from no net realized gain or loss in the 2024 period compared to net realized losses in the 2023 period, while the nine month period benefitted from lower net realized losses in the 2024 period compared to the 2023 period.
+Added: Insurance operating costs and other expenses were higher for both the three and nine month periods, prim arily due to the effect of higher fully insured ongoing premium, including higher staffing costs and commissions, as well as higher incentive compensation and benefits costs.
Fully Insured Ongoing Premiums
−Removed: [1]Other of $102 and $107 for the three months ended June 30, 2023 and 2024 respectively, and $202 and $211 for the six months ended June 30, 2023 and 2024, respectively which includes other group coverages such as retiree health insurance, critical illness, accident and hospital indemnity coverages.
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Fully insured ongoing premiums increased in both the three and six month periods over prior year and included an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year periods.
−Removed: Fully insured ongoing sales decreased in both the three and six months periods compared to prior year driven by both lower group life sales and group disability sales.
+Added: [1] Other of $102 and $107 for the three months ended September 30, 2023 and 2024 respectively, and $304 and $318 for the nine months ended September 30, 2023 and 2024, respectively which includes other group coverages such as retiree health insurance, critical illness, accident and hospital indemnity coverages.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Fully insured ongoing premiums increased in both the three and nine month periods over prior year and included an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year periods.
+Added: Fully insured ongoing sales decreased in both the three and nine months periods compared to prior year driven by lower group life and group disability sales.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Loss ratio improved 3.2 points in the three months ended June 30, 2024 compa red to the prior year period driven by a lower group life loss ratio.
−Removed: The group life loss ratio decreased
−Removed: 9.2 points driven by lower claim severity experience.
−Removed: The group disability loss ratio was essentially flat driven by lower long-term disability claim incidence, and a higher New York paid family leave risk adjustment benefit, offset by a higher loss ratio on paid family and medical leave products.
−Removed: Total loss ratio improved 2.5 points in the six months ended June 30, 2024 compared to the prior year period, primarily reflecting a lower group life loss ratio.
−Removed: The group life loss ratio decreased 6.7 points driven by a lower level of mortality and lower claim severity experience compared to the prior year period.
−Removed: The group disability loss ratio was essentially flat driven by favorable long-term disability claim recoveries and incidence, and a higher New York paid family leave risk adjustment benefit, offset by a higher loss ratio on paid family and medical leave products.
−Removed: Expense ratio decreased for the three month period primarily due to an increase in the allowance for credit losses on premiums receivable in the 2023 period and the effects of higher earned premium, partially offset by the impact of higher staffing costs, including higher incentive compensation, and higher commission expense.
−Removed: The expense ratio increased for the six month period as the impact of higher staffing costs, including higher incentive compensation, and higher commission expense, was partially offset by the effects of higher earned premium.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Loss ratio was flat in the three months ended September 30, 2024 compa red to the prior year period driven by a lower group life loss ratio offset by a higher disability loss ratio, as well as a higher loss ratio on supplemental health products.
+Added: The group life loss ratio decreased 2.7 points driven by lower mortality.
+Added: The group disability loss ratio increased 0.6 points driven by a higher loss ratio on paid family and medical leave products, partially offset by a favorable change in the long-term disability recovery rate assumption of 2.2 points.
+Added: Total loss ratio improved 1.7 points in the nine months ended September 30, 2024 compared to the prior year period, primarily reflecting a lower group life loss ratio.
+Added: The group life loss ratio decreased 5.4 points driven by a lower level of mortality.
+Added: The group disability loss ratio was essentially flat driven by favorable long-term disability claim recoveries, incidence, and changes in the long-term disability recovery rate assumption of 0.7 points, offset by higher loss ratio on paid family and medical leave products.
+Added: Expense ratio increased for the three and nine month periods primarily due to the impact of higher staffing costs, including higher incentive compensation and benefits costs, and increased investments in technology.
| HARTFORD FUNDS - RESULTS OF OPERATIONS
Operating Summary
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
1 unchanged sentence
Net investment income 5 4 25 % 14 11 27 %
−Removed: Net realized gains 3 1 NM 8 6 33 %
+Added: Net realized gains (losses) 7 (4) NM 15 2 NM
Total revenues 275 248 11 % 795 746 7 %
6 unchanged sentences
Adjustment to reconcile ROA to ROA, core earnings:
−Removed: Effect of net realized gains excluded from core earnings, before tax (0.9) (0.3) NM (1.3) (1.0) (30) %
+Added: Effect of net realized gains (losses) excluded from core earnings, before tax (2.1) 1.3 NM (1.5) (0.2) NM
Effect of income tax expense — — — % 0.3 0.1 NM
1 unchanged sentence
[1]For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.
−Removed: [2]Represents annualized earnings divided by a daily average of assets under management, as measured in basis points.
+Added: [2]Represents annualized earnings divided by a daily average of AUM, as measured in basis points.
Index to MD&A
2 unchanged sentences
Hartford Funds Segment AUM
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
2 unchanged sentences
Redemptions - Mutual Fund (6,350) (6,461) 2 % (21,130) (20,477) (3) %
−Removed: Net flows - ETF 103 210 (51 %) (106) 277 NM
+Added: Net flows - ETF 256 222 15 % 150 499 (70) %
Net flows - Mutual Fund and ETF (425) (1,629) 74 % (4,021) (4,064) 1 %
−Removed: Change in market value and other 1,212 3,855 (69 %) 7,966 8,070 (1) %
+Added: Change in market value and other 7,105 (4,296) NM 15,071 3,774 NM
Mutual Fund and ETF AUM - end of period 130,366 112,182 16 % 130,366 112,182 16 %
3 unchanged sentences
Mutual Fund and ETF AUM by Asset Class
−Removed: As of June 30,
+Added: As of September 30,
2024 2023 Change
6 unchanged sentences
[1]Includes balanced, allocation and alternative investment products.
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Net income decreased for the three months ended June 30, 2024, primarily due to a decrease in fee income net of operating costs and other expenses, partially offset by higher net realized gains and higher net investment income.
−Removed: Net income increased for the six months ended June 30, 2024, primarily due to an increase in fee income net of operating costs and other expenses, driven by an increase in daily average AUM, higher net realized gains, and higher net investment income.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Net income increased for the three months ended September 30, 2024, primarily due to a change from net realized losses to net realized gains and an increase in fee income net of operating costs and other expenses driven by higher daily average AUM.
+Added: Net income increased for the nine months ended September 30, 2024, primarily due to an increase in net realized gains, an increase in fee income net of operating costs and other expenses driven by higher daily average AUM, and higher net investment income.
Hartford Funds AUM
−Removed: June 30, 2024 compared to June 30, 2023
+Added: September 30, 2024 compared to September 30, 2023
Hartford Funds AUM increased primarily due to an increase in market values, partly offset by net outflows over the previous twelve months.
−Removed: Net outflows were $1.1 billion and $3.6 billion, respectively, for the three and six months ended June 30, 2024 compared to net outflows of $1.3 billion and $2.4 billion, respectively, for the three and six months ended June 30, 2023.
+Added: Net outflows were $0.4 billion and $4.0 billion, respectively, for the three and nine months ended September 30, 2024 compared to net outflows of $1.6 billion and $4.1 billion, respectively, for the three and nine months ended September 30, 2023.
Index to MD&A
3 unchanged sentences
Operating Summary
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 Change 2024 2023 Change
Fee income [1] $ 10 $ 10 — % $ 30 $ 30 — %
−Removed: Other revenue 1 — NM 1 1 — %
+Added: Other revenue 1 1 — % 2 2 — %
Net investment income [2] 17 12 42 % 47 30 57 %
−Removed: Net realized gains [2] 8 11 (27 %) 17 17 — %
−Removed: Total revenues (losses) 33 30 10 % 68 56 21 %
+Added: Net realized gains (losses) [2] 14 (10) NM 31 7 NM
+Added: Total revenues (losses) 42 13 NM 110 69 59 %
Benefits, losses and loss adjustment expenses [3] 1 1 — % 5 5 — %
14 unchanged sentences
Net loss available to common stockholders
−Removed: Three and six months ended June 30, 2024 compared to the three and six months ended June 30, 2023
−Removed: Net loss available to common stockholders for the three and six months ended June 30, 2024, decreased primarily due to higher net investment income and lower restructuring and other costs.
−Removed: Also impacting the six months ended June 30, 2024 was a higher tax benefit related to the vesting of stock-based compensation awards during the first quarter.
+Added: Three and nine months ended September 30, 2024 compared to the three and nine months ended September 30, 2023
+Added: Net loss available to common stockholders for the three and nine months ended September 30, 2024, decreased primarily due to a change from net realized losses to net realized gains in the three month period and an increase in net realized gains in the nine month period, a $14, before tax, capital-based state tax expense covering several years in the 2023 periods, and higher net investment income.
Index to MD&A
18 unchanged sentences
• Property- Risk of loss to personal or commercial property from automobile related accidents, weather, explosions, smoke, shaking, fire, theft, vandalism, inadequate installation, faulty equipment, collisions and falling objects, and/or machinery mechanical breakdown resulting in physical damage, losses from PV&T and other covered perils.
−Removed: • Liability- Risk of loss from automobile related accidents, uninsured and underinsured drivers, lawsuits from accidents, defective products, breach of warranty, negligent acts by professional practitioners, environmental claims, latent exposures, fraud, coercion, forgery, failure to fulfill obligations per contract surety, liability from errors and omissions, losses from credit and political risk insurance
−Removed: ("CPRI") coverages, losses from derivative lawsuits, and other securities actions and covered perils.
+Added: • Liability- Risk of loss from automobile related accidents, uninsured and underinsured drivers, lawsuits from accidents, defective products, breach of warranty, negligent acts by professional practitioners, environmental claims, latent exposures, fraud, coercion, forgery, failure to fulfill obligations per contract surety, liability from errors and omissions, losses from CPRI coverages, losses from
+Added: derivative lawsuits, and other securities actions and covered perils.
• Mortality- Risk of loss from unexpected trends in insured deaths impacting timing of payouts from group life insurance, personal or commercial automobile related accidents, and death of employees or executives during the course of employment, while on disability, or while collecting workers compensation benefits.
32 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Primary Catastrophe Treaty Reinsurance Coverages as of June 30, 2024 [1]
+Added: Primary Catastrophe Treaty Reinsurance Coverages as of September 30, 2024 [1]
Portion of losses reinsured Portion of losses retained by The Hartford
41 unchanged sentences
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.
−Removed: During the six months ended June 30, 2024, the Company collected recoveries from NICO and as a result amortized $61of the $209 deferred gain within benefits, losses and loss adjustment expenses in the Condensed Consolidated Statements of Operations.
−Removed: 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.
+Added: During the nine months ended September 30, 2024, the Company collected recoveries from NICO and as a result amortized $87 of the $209 deferred gain within benefits, losses and loss adjustment expenses in the Condensed Consolidated Statements of Operations.
+Added: 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.
For more information on the A&E ADC and the Navigators ADC, see Note 1 - Basis of Presentation and Significant Accounting Policies and Note 11 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Consolidated Financial Statements, included in The Hartford's 2023 Form 10-K Annual Report.
18 unchanged sentences
Stressed market conditions may impact the ability to sell assets or otherwise transact business and may result in a significant loss in value of the investment portfolio.
−Removed: Impact Inadequate capital resources and liquidity could negatively affect the Company’s overall financial strength and its
−Removed: ability to generate cash flows from its businesses, borrow funds at competitive rates, and raise new capital to meet operating and growth needs.
+Added: Impact Inadequate capital resources and liquidity could negatively affect the Company’s overall financial strength and its ability to generate cash flows from its businesses, borrow funds at competitive rates, and raise new capital to meet operating and growth needs.
Management The Company has defined ongoing monitoring and reporting requirements to assess liquidity across the enterprise under both current and stressed market conditions.
16 unchanged sentences
Management The objective of the Company’s enterprise credit risk management strategy is to identify, quantify and manage credit risk in aggregate and to limit potential losses in accordance with the Company's credit risk management policy.
−Removed: The Company manages its credit risk by managing aggregations of risk, holding a diversified mix of issuers and counterparties across its investment, reinsurance and insurance portfolios and limiting exposure to any specific reinsurer or counterparty.
−Removed: Potential credit losses can be mitigated through diversification (e.g., geographic regions, asset types, industry
+Added: The Company manages its credit risk by managing aggregations of risk, holding a diversified mix of issuers and counterparties across its investment, reinsurance and insurance
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: sectors), hedging and the use of collateral to reduce net credit exposure.
+Added: portfolios and limiting exposure to any specific reinsurer or counterparty.
+Added: Potential credit losses can be mitigated through diversification (e.g., geographic regions, asset types, industry sectors), hedging and the use of collateral to reduce net credit exposure.
The Company manages credit risk through the use of various surveillance, analyses and governance processes.
12 unchanged sentences
Exposures are tracked on a current and potential basis and aggregated by ultimate parent of the counterparty across investments, reinsurance receivables, insurance products with credit risk, and derivatives.
−Removed: As of June 30, 2024, the Company had no investment exposure to any credit concentration risk of a single issuer or counterparty greater than 10% of the Company’s stockholders' equity, other than the U.S.
+Added: As of September 30, 2024, the Company had no investment exposure to any credit concentration risk of a single issuer or counterparty greater than 10% of the Company’s stockholders' equity, other than the U.S.
government and certain U.S.
8 unchanged sentences
The Company also has derivative counterparty exposure policies which limit the Company’s exposure to credit risk.
−Removed: Credit exposures are generally quantified based on the prior business
−Removed: day’s net fair value, including income accruals, of all derivative positions transacted with a single counterparty for each separate legal entity.
+Added: Credit exposures are generally quantified based on the prior business day’s net fair value, including income accruals, of all derivative positions transacted with a single counterparty for each separate legal entity.
The notional amount of derivative contracts represents the basis upon which pay or receive amounts are calculated and are not necessarily reflective of credit risk.
18 unchanged sentences
Interest rate risk is the risk of financial loss due to adverse changes in the value of assets and liabilities arising from movements in interest rates.
−Removed: Interest rate risk encompasses exposures with respect to changes in the level of interest rates, the shape of the term structure of rates and the volatility of
+Added: Interest rate risk encompasses
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: interest rates.
+Added: exposures with respect to changes in the level of interest rates, the shape of the term structure of rates and the volatility of interest rates.
Interest rate risk does not include exposure to changes in credit spreads.
11 unchanged sentences
For assets supporting pension and other postretirement benefit plans, the Company may be required to make additional plan contributions if equity investments in the plan portfolios decline in value.
−Removed: Hartford Funds earnings are also significantly influenced by the U.S.
−Removed: and other equity
+Added: Hartford Funds earnings are
+Added: also significantly influenced by the U.S.
+Added: and other equity markets.
Generally, declines in equity markets will reduce the value of average daily AUM and the amount of fee income generated from those assets.
25 unchanged sentences
Fixed Maturities, AFS by Credit Quality
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Amortized Cost Fair Value Percent of Total Fair Value Amortized Cost Fair Value Percent of Total Fair Value
6 unchanged sentences
Total fixed maturities, AFS $ 43,664 $ 42,793 100.0 % $ 41,726 $ 39,818 100.0 %
−Removed: The fair value of fixed maturities, AFS increased as compared to December 31, 2023, primarily due to net additions of corporate bonds and securitized products, partially offset by net reductions to tax-exempt municipal bonds and U.S.
−Removed: treasuries, and an overall decrease in valuations due to higher interest rates.
+Added: The fair value of fixed maturities, AFS increased as compared to December 31, 2023, primarily due to net additions of corporate bonds, high-quality RMBS and CLOs, partially offset by net reductions to U.S.
+Added: treasuries, tax-exempt municipal bonds, and CMBS.
+Added: The increase was also due to higher valuations as a result of lower interest rates and tighter credit spreads.
FVO securities are not included in the preceding table.
4 unchanged sentences
Fixed Maturities, AFS by Type
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value Percent of Total Fair Value Amortized Cost ACL Gross Unrealized Gains Gross Unrealized Losses Fair Value Percent of Total Fair Value
1 unchanged sentence
Other 1,167 — 22 (13) 1,176 2.7 % 933 — 8 (27) 914 2.3 %
−Removed: CLO 3,507 — 8 (1) 3,514 8.6 % 3,104 — 3 (17) 3,090 7.8 %
−Removed: Commercial Mortgage-Backed Securities ("CMBS")
+Added: CLOs 3,553 — 10 — 3,563 8.3 % 3,104 — 3 (17) 3,090 7.8 %
Agency [1] 1,244 (13) 21 (92) 1,160 2.7 % 1,179 (12) 14 (119) 1,062 2.7 %
16 unchanged sentences
Tax-exempt 4,445 — 109 (161) 4,393 10.3 % 4,996 — 124 (186) 4,934 12.4 %
−Removed: Residential Mortgage-Backed Securities ("RMBS")
Agency 2,773 — 35 (138) 2,670 6.2 % 2,342 — 14 (171) 2,185 5.5 %
5 unchanged sentences
[1] Includes securities with pools of loans issued by the Small Business Administration which are backed by the full faith and credit of the U.S.
−Removed: The fair value of fixed maturities, AFS increased as compared to December 31, 2023, primarily due to net additions of corporate bonds and securitized products, partially offset by net reductions to tax-exempt municipal bonds and U.S.
−Removed: treasuries, and an overall decrease in valuations due to higher interest rates.
−Removed: The Company primarily increased holdings of consumer, financial services, utilities, and energy corporate bonds, in addition to high-quality RMBS and CLO.
+Added: The fair value of fixed maturities, AFS increased as compared to December 31, 2023, primarily due to net additions of corporate bonds, high-quality RMBS and CLOs, partially offset by net reductions to U.S.
+Added: treasuries, tax-exempt municipal bonds, and CMBS.
+Added: The increase was also due to higher valuations as a result of lower interest rates and tighter credit spreads.
Commercial & Residential Real Estate
3 unchanged sentences
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: Exposure to CMBS & RMBS Bonds as of June 30, 2024
+Added: Exposure to CMBS & RMBS Bonds as of September 30, 2024
AAA AA A BBB BB and Below Total
26 unchanged sentences
A loan participation interest represents a pro-rata share in interest and principal payments generated by the participated loan, and the relationship between the Company as loan originator, lead participant and servicer and the third party as a participant are governed by a participation agreement.
−Removed: As of June 30, 2024, mortgage loans had an amortized cost of $6.4 billion and carrying value of $6.4 billion, with an ACL of $48.
+Added: As of September 30, 2024, mortgage loans had an amortized cost of $6.5 billion and carrying value of $6.4 billion, with an ACL of $44.
As of December 31, 2023, mortgage loans had an amortized cost of $6.1 billion and carrying value of $6.1 billion, with an ACL of $51.
−Removed: The release in the allowance reflects
−Removed: improved economic scenario forecasts and property specific reductions, partially offset by net additions of new loans.
−Removed: The Company funded $371 of commercial mortgage loans, primarily industrial properties, with a weighted average loan-to-value (“ LTV ”) ratio of 58% and a weighted average yield of 7.1% during the six months ended June 30, 2024.
+Added: The release in the allowance reflects write-
+Added: offs, improved economic scenario forecasts and property specific reductions, partially offset by net additions of new loans.
+Added: The Company funded $462 of commercial mortgage loans, primarily industrial properties, with a weighted average loan-to-value (“ LTV ”) ratio of 58% and a weighted average yield of 7.2% during the nine months ended September 30, 2024.
The Company continues to originate commercial mortgage loans on institutional-quality properties with strong LTV ratios.
−Removed: There were no mortgage loans held for sale as of June 30, 2024, or December 31, 2023.
+Added: There were no mortgage loans held for sale as of September 30, 2024, or December 31, 2023.
Municipal Bonds
4 unchanged sentences
Available For Sale Investments in Municipal Bonds
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Amortized Cost Fair Value Weighted Average Credit Quality Amortized Cost Fair Value Weighted Average Credit Quality
7 unchanged sentences
Power 302 300 A+ 275 271 A
−Removed: Housing 198 188 AA 179 172 AA
Sales Tax 199 204 AA 231 237 AA
+Added: Housing 204 199 AA 179 172 AA
Other 514 498 AA- 611 588 A+
6 unchanged sentences
Lease payments may be subject to annual appropriation by the municipality, or the municipality may be obligated to appropriate general tax revenues to make lease payments.
−Removed: As of June 30, 2024, the largest issuer concentrations were CommonSpirit Health, the State of Illinois, and the Metropolitan Transportation Authority, which each comprised less than 3% of the municipal bond portfolio and were primarily comprised of general obligation and revenue bonds.
+Added: As of September 30, 2024, the largest issuer concentrations were the State of Illinois, the New York City Transitional Finance Authority, and CommonSpirit Health, which each comprised less than 3% of the municipal bond portfolio and were primarily comprised of general obligation and revenue bonds.
As of December 31, 2023, the largest issuer concentrations were the New York City Transitional Finance Authority, the State of Illinois, and the Metropolitan Transportation Authority, which each comprised less than 3% of the municipal bond portfolio and were primarily comprised of general obligation and revenue bonds.
5 unchanged sentences
Limited Partnerships and Other Alternative Investments - Net Investment Income
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
11 unchanged sentences
Investments in Limited Partnerships and Other Alternative Investments
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Amount Percent Amount Percent
6 unchanged sentences
Fixed Maturities, AFS — Unrealized Loss Aging
−Removed: The total gross unrealized losses were $2.4 billion as of June 30, 2024, and have increased $136 from December 31, 2023, primarily due to higher interest rates.
−Removed: As of June 30, 2024, $1.9 billion of the gross unrealized losses were associated with fixed maturities, AFS depressed less than 20% of amortized cost.
−Removed: The remaining $523 of gross unrealized losses were associated with fixed maturities, AFS depressed greater than 20%.
−Removed: The fixed maturities, AFS depressed more than 20% primarily related to corporate fixed maturities, U.S.
−Removed: treasuries, municipal bonds, and RMBS that are mainly depressed because current interest rates are higher and/or market spreads are wider than at the respective purchase dates.
+Added: The total gross unrealized losses were $1.5 billion as of September 30, 2024, and have decreased $0.8 billion from December 31, 2023, primarily due to lower interest rates and tighter credit spreads.
+Added: As of September 30, 2024, $1.3 billion of the gross unrealized losses were associated with fixed maturities, AFS depressed less than 20% of amortized cost.
+Added: The remaining $0.2 billion of gross unrealized losses were associated with fixed maturities, AFS depressed greater than 20%.
+Added: The fixed maturities, AFS depressed more than 20% primarily related to corporate fixed maturities, municipal bonds, and U.S.
+Added: treasuries, that are mainly depressed because current interest rates are higher and/or market spreads are wider than at the respective purchase dates.
As part of the Company’s ongoing investment monitoring process, the Company has reviewed its fixed maturities, AFS in an unrealized loss position and concluded that these fixed maturities are temporarily depressed and are expected to recover in value as the investments approach maturity or as market spreads tighten.
3 unchanged sentences
Unrealized Loss Aging for Fixed Maturities, AFS Securities
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Consecutive Months
7 unchanged sentences
Unrealized Loss Aging for Fixed Maturities, AFS Continuously Depressed Over 20%
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Consecutive Months
10 unchanged sentences
Credit Losses on Fixed Maturities, AFS and Intent-to-Sell Impairments
−Removed: Three and six months ended June 30, 2024
−Removed: For the three and six months ended June 30, 2024, the Company recorded net credit losses of $1 and $2, respectively.
−Removed: Net credit losses were primarily attributable to increases in the ACL of $1 in both periods on CMBS, in addition for the six month period, net credit losses of $1 primarily attributable to one below investment grade corporate issuer.
−Removed: Unrealized losses on securities with an ACL recognized in other comprehensive income ("OCI") were less than $1.
+Added: Three and nine months ended September 30, 2024
+Added: For the three and nine months ended September 30, 2024, the Company recorded net credit losses of $0 and $2, respectively.
+Added: Net credit losses were primarily attributable to increases in the ACL of $1 on CMBS and $1 on a below investment grade corporate issuer.
+Added: For the three and nine months ended September 30, 2024, unrealized losses on securities with an ACL recognized in other comprehensive income ("OCI") were $0 and less than $1, respectively.
For further information, refer to Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
2 unchanged sentences
Future intent-to-sell impairments or credit losses may develop as the result of changes in our intent to sell specific securities that are in an unrealized loss position or if modeling assumptions, such as macroeconomic factors or security specific developments, change unfavorably from our current modeling assumptions, resulting in lower cash flow expectations.
−Removed: Three and six months ended June 30, 2023
−Removed: For the three and six months ended June 30, 2023, the Company recorded net credit losses of $3 and $8, respectively.
−Removed: The net credit losses were primarily attributable to new expected credit losses of $2 and $6, respectively, related to two below investment grade corporate issuers.
−Removed: For the three and six months ended June 30, 2023, unrealized losses on securities with an ACL recognized in other comprehensive income were $0 and $4, respectively.
+Added: Three and nine months ended September 30, 2023
+Added: For the three and nine months ended September 30, 2023, the Company recorded net credit losses of $5 and $13, respectively.
+Added: The net credit losses were primarily attributable to increases in the ACL of $5 and $11, respectively, related to three below investment grade corporate issuers.
+Added: For the three and nine months ended September 30, 2023, unrealized losses on securities with an ACL recognized in OCI were $0 and $4, respectively.
There were no intent-to-sell impairments.
ACL on Mortgage Loans
−Removed: Three and six months ended June 30, 2024
+Added: Three and nine months ended September 30, 2024
The Company reviews mortgage loans on a quarterly basis to estimate the ACL with changes in the ACL recorded in net realized gains and losses.
1 unchanged sentence
For further information, refer to Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
−Removed: For the three months ended June 30, 2024, the ACL on mortgage loans was unadjusted.
−Removed: For the six months ended June 30, 2024, the Company recorded a release in the ACL on mortgage loans of $3.
−Removed: The release reflects improved economic scenario forecasts and property specific reductions, partially offset by net additions of new loans.
−Removed: The Company did not record an ACL on any individual mortgage loans.
−Removed: Three and six months ended June 30, 2023
−Removed: For both the three and six months ended June 30, 2023, the Company recorded an increase in the ACL on mortgage loans of $5.
−Removed: The increase in the allowance is primarily attributable to overall weaker projected real estate fundamentals, and to a lesser extent, net additions of new loans.
−Removed: The Company did not record an ACL on any individual mortgage loans.
+Added: For the three months ended September 30, 2024, there were no credit loss adjustments on mortgage loans.
+Added: For the nine months ended September 30, 2024, the Company recorded a credit loss reversal of $3 primarily attributable to improved economic scenario forecasts and property specific improvements, partially offset by net additions of new loans.
+Added: Three and nine months ended September 30, 2023
+Added: For the three and nine months ended September 30, 2023, the Company recorded an increase in the ACL on mortgage loans of $5 and $10, respectively.
+Added: The increase in the allowance is primarily attributable to lower property valuations and overall weaker real estate fundamentals.
Index to MD&A
4 unchanged sentences
| SUMMARY OF CAPITAL RESOURCES AND LIQUIDITY
−Removed: Capital available to the holding company as of June 30, 2024:
+Added: Capital available to the holding company as of September 30, 2024:
• Approximately $1.2 billion in fixed maturities, short-term investments, investment sales receivable and cash at the HFSG Holding Company;
• A senior unsecured revolving credit facility that provides for borrowing capacity up to $750 of unsecured credit through October 27, 2026.
−Removed: As of June 30, 2024, there were no borrowings outstanding;
+Added: As of September 30, 2024, there were no borrowings outstanding;
• An intercompany liquidity agreement that allows for short-term advances of funds among the HFSG Holding Company and certain affiliates of up to $2.0 billion for liquidity and other general corporate purposes.
−Removed: As of June 30, 2024, $1.9 billion was available, $105 was outstanding between certain affiliates and there were no amounts outstanding at the HFSG holding company.
−Removed: Dividends and other sources of capital for the six months ended June 30, 2024:
+Added: As of September 30, 2024, $1.9 billion was available, $105 was outstanding between certain affiliates and there were no amounts outstanding at the HFSG holding company.
+Added: Dividends and other sources of capital for the nine months ended September 30, 2024:
The future payment of dividends from our subsidiaries is dependent on several factors including the business results, capital position and liquidity of our subsidiaries.
−Removed: • P&C - HFSG Holding Company received $567 of net dividends from the Company's property and casualty insurance subsidiaries through June 30, 2024;
−Removed: • Group Benefits - HFSG Holding Company received $458 in dividends from Hartford Life and Accident Insurance Company (" HLA ") through June 30, 2024;
−Removed: • Hartford Funds - HFSG Holding Company received $64 in dividends from Hartford Funds through June 30, 2024;
−Removed: • Other - HFSG Holding Company received $28 in dividends from other non-insurance subsidiaries through June 30, 2024.
−Removed: Expected liquidity requirements for the next twelve months as of June 30, 2024:
+Added: • P&C - HFSG Holding Company received $967 of net dividends from the Company's property and casualty insurance subsidiaries through September 30, 2024;
+Added: • Group Benefits - HFSG Holding Company received $533 in dividends from Hartford Life and Accident Insurance Company (" HLA ") through September 30, 2024;
+Added: • Hartford Funds - HFSG Holding Company received $98 in dividends from Hartford Funds through September 30, 2024;
+Added: • Other - HFSG Holding Company received $28 in dividends from other non-insurance subsidiaries through September 30, 2024.
+Added: Expected liquidity requirements for the next twelve months as of September 30, 2024:
• $194 of interest on debt.
2 unchanged sentences
• $595 of common stockholders' dividends, subject to the discretion of the Board of Directors and before share repurchases.
−Removed: Expected liquidity requirements for beyond the next twelve months as of June 30, 2024:
+Added: Expected liquidity requirements for beyond the next twelve months as of September 30, 2024:
• Interest on and repayments of debt.
2 unchanged sentences
Equity repurchase program:
−Removed: During the six months ended June 30, 2024, the Company repurchased 7.3 million common shares for $700 under the $3.0 billion share repurchase program authorized by the Board of Directors, effective through December 31, 2024.
−Removed: As of June 30, 2024, the Company has $648 remaining for equity repurchases under the share repurchase program.
−Removed: During the period July 1, 2024 through July 24, 2024, the Company repurchased approximately 1.0 million common shares for $105.
−Removed: 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.
−Removed: While the Company has the flexibility to use a portion of the new authorization in 2024, it expects to use the vast majority of the new authorization in 2025 and 2026.
+Added: During the nine months ended September 30, 2024, the Company repurchased 11.0 million common shares for $1.1 billion under the $3.0 billion share repurchase authorization that is effective until December 31, 2024 as authorized by the Board of Directors.
+Added: 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.
+Added: While the Company anticipates using a portion of the new authorization over the remainder of 2024, it expects to use the vast majority of the new authorization in 2025 and 2026.
+Added: As of September 30, 2024, the Company has $3.5 billion remaining for equity repurchases under both these share repurchase programs.
+Added: During the period October 1, 2024 through October 23, 2024, the Company repurchased 1.0 million common shares for $115.
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.
3 unchanged sentences
The liquidity requirements of HFSG Holding Company will primarily be met by HFSG Holding Company's fixed maturities, short-term investments and cash, and dividends from its subsidiaries, principally its insurance operations .
−Removed: The Company maintains sufficient liquidity and has a variety of contingent liquidity resources to manage liquidity across a range of economic scenarios.
−Removed: The HFSG Holding Company expects to continue to receive
+Added: The Company maintains sufficient liquidity and has a variety of contingent
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
−Removed: dividends from its operating subsidiaries in the future and manages capital in its operating subsidiaries to be sufficient under significant economic stress scenarios.
+Added: liquidity resources to manage liquidity across a range of economic scenarios.
+Added: The HFSG Holding Company expects to continue to receive dividends from its operating subsidiaries in the future and manages capital in its operating subsidiaries to be sufficient under significant economic stress scenarios.
Dividends from subsidiaries and other sources of funds at the holding company may be used to repurchase shares under the authorized share repurchase program at the discretion of management.
1 unchanged sentence
The Company could also choose to have its insurance subsidiaries sell certain highly liquid, high quality fixed maturities or the Company could issue debt in the public markets under its shelf registration.
−Removed: The Hartford's Board of Directors declared the following quarterly dividends since April 1, 2024:
+Added: The Hartford's Board of Directors declared the following quarterly dividends since July 1, 2024:
Common Stock Dividends
Declared Record Payable Amount per share
−Removed: May 15, 2024 June 3, 2024 July 2, 2024 $ 0.470
July 17, 2024 September 3, 2024 October 2, 2024 $ 0.470
+Added: October 24, 2024 December 2, 2024 January 3, 2025 $ 0.520
Preferred Stock Dividends
Declared Record Payable Amount per share
−Removed: May 15, 2024 August 1, 2024 August 15, 2024 $ 375.000
July 17, 2024 November 1, 2024 November 15, 2024 $ 375.00
5 unchanged sentences
For a discussion of restrictions on dividends to HFSG Holding Company from its insurance subsidiaries see Part II, Item 7, MD&A – Capital Resources and Liquidity - Dividends from Subsidiaries in The Hartford’s 2023 Form 10-K Annual Report.
−Removed: Through the first six months of 2024, HFSG Holding Company received $1.1 billion of net dividends from its subsidiaries, including $458 from HLA, $64 from Hartford Funds, $28 from other non-insurance subsidiaries and $567 from its P&C subsidiaries, excluding $25 of P&C dividends that were subsequently contributed to P&C subsidiaries and $25 of P&C
−Removed: dividends related to interest payments on an intercompany note owed by Hartford Holdings, Inc.
+Added: Through the first nine months of 2024, HFSG Holding Company received $1.6 billion of net dividends from its subsidiaries, including $533 from HLA, $98 from Hartford Funds, $28 from other non-insurance subsidiaries and $967 from its P&C
+Added: subsidiaries, excluding $50 of P&C dividends that were subsequently contributed to P&C subsidiaries and $37 of P&C dividends related to interest payments on an intercompany note owed by Hartford Holdings, Inc.
("HHI") to Hartford Fire Insurance Company.
4 unchanged sentences
Shelf Registrations
−Removed: The Hartford filed an automatic shelf registration statement with the Securities and Exchange Commission on February 22, 2022 that permits it to offer and sell debt and equity securities during the three-year life of the registration statement.
−Removed: For further information regarding shelf registrations, Note 14 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K Annual Report.
+Added: The Hartford filed an automatic shelf registration statement with the Securities and Exchange Commission on September 23, 2024 that permits it to offer and sell debt and equity securities during the three-year life of the registration statement.
+Added: For further information regarding shelf registrations, see Note 13 - Debt of Notes to Condensed Consolidated Financial Statements.
Revolving Credit Facility
The Hartford has a senior unsecured revolving credit facility (the "Credit Facility") that provides up to $750 of unsecured credit through October 27, 2026.
−Removed: As of June 30, 2024, no borrowings were outstanding and no letters of credit were issued under the Credit Facility and The Hartford was in compliance with all financial covenants.
+Added: As of September 30, 2024, no borrowings were outstanding and no letters of credit were issued under the Credit Facility and The Hartford was in compliance with all financial covenants.
For further information regarding the Credit Facility, see Note 14 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K Annual Report.
2 unchanged sentences
The Connecticut Department of Insurance ("CTDOI") granted approval for certain affiliated insurance companies that are parties to the agreement to treat receivables from a parent, including the HFSG Holding Company, as admitted assets for statutory accounting purposes.
−Removed: As of June 30, 2024, $1.9 billion was available, $105 was outstanding between certain affiliates, and there were no amounts outstanding at the HFSG Holding Company.
+Added: As of September 30, 2024, $1.9 billion was available, $105 was outstanding between certain affiliates, and there were no amounts outstanding at the HFSG Holding Company.
Index to MD&A
5 unchanged sentences
Advances may be used to support general corporate purposes, which would be presented as short- or long-term debt, or to earn incremental investment income, which would be presented in other liabilities consistent with other collateralized financing transactions.
−Removed: As of June 30, 2024, there were no advances outstanding.
+Added: As of September 30, 2024, there were no advances outstanding.
For further information regarding collateralized advances with FHLBB, see Note 14 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K Annual Report.
1 unchanged sentence
The Hartford has a committed credit facility agreement with a syndicate of lenders (the "Lloyd's Facility").
−Removed: The Lloyd's Facility has two tranches with one tranche extending a $74 commitment and the other tranche extending a £73 million ($92 as of June 30, 2024) commitment.
−Removed: As of June 30, 2024, letters of credit with an aggregate face amount of $74 and £73 million, or $92, were outstanding under the Lloyd's Facility.
−Removed: Among other covenants, the Lloyd's Facility contains financial covenants regarding The Hartford's consolidated net worth and financial leverage and that limit the amount of letters of credit that can support Funds at Lloyd's, consistent with Lloyd's requirements.
−Removed: As of June 30, 2024, The Hartford was in compliance with all financial covenants of the facility.
+Added: On October 21, 2024, The Hartford amended and restated its Lloyd’s Facility agreement.
+Added: 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) commitment.
+Added: 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.
+Added: Among other covenants, the Lloyd's Facility contains financial covenants regarding The Hartford's consolidated net worth and financial leverage.
+Added: As of September 30, 2024, The Hartford was in compliance with all financial covenants of the facility.
For further information regarding the Lloyd's Facility, see Note 14 - Debt of Notes to Consolidated Financial Statements included in the Company’s 2023 Form 10-K Annual Report.
9 unchanged sentences
For further information, refer to Note 14 - Commitments and Contingencies of Notes to Condensed Consolidated Financial Statements.
−Removed: As of June 30, 2024, no derivative positions would be subject to immediate termination in the event of a downgrade of one level below the current financial strength ratings.
+Added: As of September 30, 2024, no derivative positions would be subject to immediate termination in the event of a downgrade of one level below the current financial strength ratings.
This could change as a result of changes in our hedging activities or to the extent changes in contractual terms are negotiated.
8 unchanged sentences
Property & Casualty Operations
−Removed: As of June 30, 2024
+Added: As of September 30, 2024
Fixed maturities $ 34,591
4 unchanged sentences
Group Benefits
−Removed: As of June 30, 2024
+Added: As of September 30, 2024
Fixed maturities $ 8,266
7 unchanged sentences
The primary uses of funds are to pay claims, claim adjustment expenses, commissions and other underwriting and insurance operating costs, to pay taxes, to purchase new investments and to make dividend payments to the HFSG Holding Company.
−Removed: Property & Casualty reserves for unpaid losses and loss adjustment expenses as of June 30, 2024 were $35.1 billion and net of reinsurance were $28.6 billion.
+Added: Property & Casualty reserves for unpaid losses and loss adjustment expenses as of September 30, 2024 were $35.7 billion and net of reinsurance were $29.2 billion.
Reserves for Property & Casualty unpaid losses and loss adjustment expenses include case reserves and incurred but not reported (" IBNR" ) reserves.
5 unchanged sentences
In particular, there is significant uncertainty over the claim payment patterns of A&E claims.
−Removed: Group Benefits reserves as of June 30, 2024 were $8.9 billion and net of reinsurance were $8.6 billion.
+Added: Group Benefits reserves as of September 30, 2024 were $8.9 billion and net of reinsurance were $8.6 billion.
Group life and disability obligations are estimated using assumptions based on the Company’s historical experience, modified for recent observed trends.
4 unchanged sentences
Due to the significance of the assumptions used, payments for the next twelve months and beyond twelve months could materially differ from historical patterns.
−Removed: Corporate includes reserves as of June 30, 2024 were $386 and net of reinsurance were $152.
+Added: Corporate includes reserves as of September 30, 2024 were $382 and net of reinsurance were $156.
These reserves related to retained run-off liabilities of its former life and annuity business.
2 unchanged sentences
Hartford Funds' principal sources of operating funds are fees earned from basis points on AUM with uses primarily for payments to subadvisors and other general operating expenses.
−Removed: As of June 30, 2024, Hartford Funds cash and short-term investments were $269.
+Added: As of September 30, 2024, Hartford Funds cash and short-term investments were $281.
| PURCHASE AND OTHER OBLIGATIONS
9 unchanged sentences
Capital Structure
−Removed: June 30, 2024 December 31, 2023 Change
+Added: September 30, 2024 December 31, 2023 Change
Long-term debt $ 4,365 $ 4,362 — %
9 unchanged sentences
Debt to capitalization 20 % 22 %
−Removed: Total capitalization increased $355 as of June 30, 2024 compared to December 31, 2023 primarily due to net income in excess of common stockholder dividends in the period, partially offset by share repurchases and an increase in net unrealized losses on fixed maturities, AFS.
+Added: Total capitalization increased $1,684 as of September 30, 2024 compared to December 31, 2023 primarily due to net income in excess of common stockholder dividends in the period, and a decrease in net unrealized losses on fixed maturities, AFS partially offset by share repurchases.
For additional information on AOCI, net of tax, including net unrealized gain (losses) from securities, see Note 16 - Changes
In and Reclassifications From Accumulated Other Comprehensive Income (Loss) and Note 5 - Investments of Notes to Condensed Consolidated Financial Statements.
−Removed: For additional information on debt, see and Note 14 - Debt of Notes to Consolidated Financial Statement in The Hartford's 2023 Form 10-K Annual Report.
−Removed: Six Months Ended June 30,
+Added: For additional information on debt, see Note 14 - Debt of Notes to Consolidated Financial Statement in The Hartford's 2023 Form 10-K Annual Report.
+Added: Nine Months Ended September 30,
Net cash provided by operating activities $ 4,035 $ 2,593
−Removed: Net cash provided by (used for) investing activities $ (1,323) $ 53
+Added: Net cash used for investing activities $ (2,412) $ (1,266)
Net cash used for financing activities $ (1,529) $ (1,493)
Cash and restricted cash– end of period $ 281 $ 181
−Removed: Cash provided by operating activities increased in 2024 as compared to the prior year period primarily driven by a decrease in P&C loss and loss adjustment expenses due to the $787 payment to the Boy Scouts of America in the prior year, and an increase in P&C and Group Benefits premiums received, partially offset by higher operating expenses, including increased commissions and staffing costs, and an increase in Group Benefits loss and loss adjustment expenses paid.
−Removed: Cash used for investing activities changed from net inflows in the 2023 period to net outflows in the 2024 period as a result of a decrease in net proceeds from equity securities at fair value, an increase in net payments for fixed maturities, AFS,
−Removed: and a decrease in net proceeds from short term investments, partially offset by an increase in payments for fixed maturities, FVO.
−Removed: Cash used for financing activities was consistent with the prior year, as a decrease in net issuance of shares under incentive and stock compensation plans was largely offset by an increase in dividends paid on common stock and an increase in net outflows on investment and universal life type contracts.
−Removed: Operating cash flows for the six months ended June 30, 2024 has been adequate to meet liquidity requirements.
−Removed: | EQUITY MARKETS
−Removed: For a discussion of the potential impact of the equity markets on capital and liquidity, see the Financial Risk section in this MD&A and the Financial Risk on Statutory Capital section of the MD&A in the Company's 2023 Form 10-K Annual Report.
+Added: Cash provided by operating activities increased in 2024 as compared to the prior year period primarily driven by an increase in P&C and Group Benefits premiums received, a decrease in P&C loss and loss adjustment expenses paid due to the $787 payment to the Boy Scouts of America in the prior year, partially offset by higher operating expenses, including increased commissions and staffing costs, an increase in Group Benefits loss and loss adjustment expenses paid, and taxes paid.
+Added: Cash used for investing activities increased in 2024 as compared to the prior year driven by a decrease in net proceeds from equity securities at fair value, a decrease in net proceeds from short term investments, and an increase in net payments for mortgage loans, partially offset by a change from net payments for to net proceeds from derivatives and a decrease in net payments for partnerships.
+Added: Cash used for financing activities increased in 2024 as compared to the prior year period driven by an increase in treasury stock acquired, an increase in dividends paid on common stock, and an increase in net outflows on investment and universal life type contracts, partially offset by a decrease in net issuance of shares under incentive and stock compensation plans.
+Added: Operating cash flows for the nine months ended September 30, 2024 has been adequate to meet liquidity requirements.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: | EQUITY MARKETS
+Added: For a discussion of the potential impact of the equity markets on capital and liquidity, see the Financial Risk section in this MD&A and the Financial Risk on Statutory Capital section of the MD&A in the Company's 2023 Form 10-K Annual Report.
Ratings are an important factor in establishing a competitive position in the insurance marketplace and impact the Company's ability to access financing and its cost of borrowing.
9 unchanged sentences
Insurance Financial Strength Ratings as of
−Removed: July 24, 2024
+Added: October 23, 2024
Best Standard & Poor’s Moody’s
15 unchanged sentences
statutory capital 500 (115) 385
−Removed: U.S statutory capital at June 30, 2024
+Added: U.S statutory capital at September 30, 2024
$ 13,049 $ 2,633 $ 15,682
1 unchanged sentence
[2] Excludes insurance operations in the U.K.
−Removed: | CONTINGENCIES
−Removed: Legal Proceedings
−Removed: For a discussion regarding The Hartford’s legal proceedings, see the information contained in Note 13 - Commitments and Contingencies of the Notes to Condensed Consolidated Financial Statements.
Index to MD&A
1 unchanged sentence
Management's Discussion and Analysis of Financial Condition and Results of Operations
+Added: | CONTINGENCIES
+Added: Legal Proceedings
+Added: For a discussion regarding The Hartford’s legal proceedings, see the information contained in Note 14 - Commitments and Contingencies of the Notes to Condensed Consolidated Financial Statements.
Legislative and Regulatory Developments
21 unchanged sentences
Available-For-Sale
−Removed: Loss Adjustment Expense
+Added: Information Technology
Allocated Loss Adjustment Expenses
−Removed: Liability for Credit Losses
+Added: Loss Adjustment Expense
Accumulated Other Comprehensive Income
−Removed: London Inter-Bank Offered Rate
+Added: Liability for Credit Losses
Assets Under Management
−Removed: Long-Term Disability
+Added: London Inter-Bank Offered Rate
Boy Scouts of America
−Removed: Loan-to-Value
+Added: Long-Term Disability
Current Accident Year
−Removed: Management's Discussion and Analysis of Financial Conditions and Results of Operations
+Added: Loan-to-Value
Collateralized Loan Obligations
−Removed: National Association of Insurance Commissioners
+Added: Management's Discussion and Analysis of Financial Conditions and Results of Operations
Commercial Mortgage-Backed Securities
+Added: National Association of Insurance Commissioners
+Added: CME Chicago Mercantile Exchange NICO
National Indemnity Company, a subsidiary of Berkshire Hathaway Inc.
(“Berkshire”)
−Removed: CME Chicago Mercantile Exchange NM
−Removed: Not Meaningful
Credit and Political Risk Insurance
−Removed: Net Operating Loss Carryforwards or Carrybacks
+Added: Not Meaningful
Deferred Policy Acquisition Costs
−Removed: Other Comprehensive Income
+Added: Net Operating Loss Carryforwards or Carrybacks
Diversity, Equity and Inclusion
−Removed: Over-the-Counter
+Added: Other Comprehensive Income
Disabled Life Reserve
+Added: Over-the-Counter
+Added: Directors and Officers P&C
Property and Casualty
−Removed: Directors and Officers PV&T
−Removed: Political Violence and Terrorism
Debt Service Coverage Ratio
−Removed: Prior Accident Year Development
+Added: Political Violence and Terrorism
Enterprise Risk and Capital Committee
−Removed: Risk-Based Capital
+Added: Prior Accident Year Development
The Hartford Employee Stock Purchase Plan
−Removed: Residential Mortgage-Backed Securities
+Added: Risk-Based Capital
Exchange-Traded Funds
−Removed: Return on Assets
+Added: Residential Mortgage-Backed Securities
Financial Accounting Standards Board
+Added: Return on Assets
+Added: FHCF Florida Hurricane Catastrophe Fund ROE
Return on Equity
4 unchanged sentences
Generally Accepted Accounting Principles
−Removed: Unallocated Loss Adjustment Expenses
+Added: TRIPRA Terrorism Risk Insurance Program Reauthorization Act
Hartford Financial Services Group, Inc.
+Added: Unallocated Loss Adjustment Expenses
Part I - Item 4.
1 unchanged sentence
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.