The paragraph is an introduction to Hartford Financial's Third Quarter 2024 Results Conference Call and Webcast. Susan Spivak Bernstein, Senior Vice President of Investor Relations, opens the call, explaining that the results were reported and materials posted on their website. Chris Swift (CEO) and Beth Costello (CFO) will speak, followed by a Q&A session with help from other management team members. Susan emphasizes that the call will include forward-looking statements and non-GAAP financial measures, advising investors about potential risks and uncertainties, and noting legal disclaimers regarding reproduction of the call.

The Hartford's third quarter performance demonstrated strong financial results despite challenges from Hurricanes Milton and Helene. The company highlighted top-line growth, with Commercial Lines increasing by 9% and Personal Lines by 12%, along with significant improvements in underwriting and margins. The Group Benefits core earnings margin was 8.7%, and the investment portfolio continued to perform well, leading to a trailing 12-month core earnings ROE of 17.4%. The company announced an 11% increase in their quarterly dividend, reflecting strong earnings and capital generation. The paragraph also notes the company's commitment to customer support during challenging times.

The paragraph highlights the strong performance of Hartford's Commercial Lines, emphasizing consistent top-line growth and a low underlying combined ratio for 14 quarters. The company attributes this success to its advanced underwriting tools, pricing expertise, and data science innovations. Significant growth is noted in small commercial and middle market segments, with new business premiums increasing by 26% in the quarter, spurred by a rise in quotes and E&S binding premiums. Hartford’s extensive product offerings, strategic tech investments, and focus on simplicity and speed provide a competitive edge, facilitating precise pricing and customer support as businesses expand. The company aims to gain market share while maintaining profitable margins and expresses optimism about future growth in its small commercial business.

The third-quarter performance was strong, with 8% revenue growth and consistent margins around 90% for the past eight quarters. The company achieved a 28% increase in new business in the middle market, largely driven by property, and maintained strong renewal rates. In Global Specialty, earned premiums reached nearly $850 million, supported by a 9% gross written premium growth, led by a 17% increase in wholesale business and significant contributions from auto, excess casualty, and global reinsurance. Premium growth in Commercial Lines, particularly in property, was approximately 20%, aligning with a $3 billion full-year target. The company has been successful in maintaining strong risk-adjusted returns through disciplined catastrophe risk management. Pricing trends include a 9.5% increase in renewal pricing excluding workers' compensation, with auto and general liability responding to societal trends, and umbrella and excess pricing rising in the mid-teens.

The paragraph reports on the overall strong pricing trends in commercial property, with stable loss trends in Commercial Lines and slightly positive workers' compensation pricing. Personal Lines showed a significant improvement in the auto sector, with robust renewal price increases and homeowners' pricing exceeding loss cost trends. Group Benefits had a strong core earnings margin driven by favorable group life and disability outcomes, with stable premium growth and high book persistency. Investments are performing well, supporting strategic goals. Insights from the CIAB Annual Conference highlighted the ongoing strength of the franchise.

The paragraph discusses the strong performance of The Hartford, highlighting partnerships that emphasize its innovative digital tools, comprehensive products, and strong strategy execution. Partners are eager to expand business with them, recognizing their exemplary team and strong relationships. The Hartford delivered an excellent quarter, attributed to its disciplined underwriting, pricing execution, and customer-centric technology. Core earnings for the quarter were $752 million, or $2.53 per diluted share, with a 12-month ROE of 17.4%. Commercial Lines reported $534 million in core earnings, with 9% growth in written premiums and an underlying combined ratio of 88.6. Small Commercial also showed impressive results with 10% growth in written premiums and a slightly improved combined ratio of 89.3, despite some challenges.

In the Middle & Large Commercial sector, written premiums increased by 8% with a combined ratio of 90.2, slightly higher than last year due to increased property losses and liability ratios, but benefited from business mix changes and premium leverage. Global Specialty saw a 9% rise in written premiums and a combined ratio of 85.3. The increase was primarily due to higher losses in global reinsurance, particularly in Latin America, and a higher expense ratio. Personal Lines experienced a 12% increase in written premiums, driven by significant pricing increases in auto and homeowners, with improved combined ratios. The auto sector showed notable progress, with a combined ratio improvement to 101.5 and an overall improvement through September, driven by pricing increases outpacing loss costs despite some offset by rising expenses.

The paragraph discusses an increase in the Personal Lines expense ratio due to higher direct marketing, incentive compensation, and benefit costs, partially offset by higher earned premiums. It reports on catastrophe (CAT) losses, noting $247 million in current year CAT losses before tax, which is higher than the previous year's $184 million. The company manages CAT exposure with aggregation management, underwriting discipline, and a comprehensive reinsurance program, including a $200 million aggregate cover for losses exceeding $750 million. By September 30th, CAT losses were $660 million, $90 million shy of the attachment point. Estimated losses from Hurricane Milton range from $65 million to $110 million, which could bring them close to the attachment point. The paragraph also notes $24 million in net favorable prior accident year development, mainly from reserve reductions in workers' compensation and personal auto physical damage, offset by reserve increases in general and commercial auto liability. A $32 million increase in general liability reserves is linked to a higher frequency of large losses. The company is adjusting its underwriting and pricing strategies in response to liability trends.

The company reported a $26 million pre-tax deferred gain from the Navigators ADC, which boosted net income without affecting core earnings. Their asbestos and environmental coverage stands at $62 million, and any excess costs beyond this will affect core earnings. The Group Benefits segment had a strong quarter, with a core earnings margin of 8.7%, driven by improved group life mortality and growth in fully insured premiums. The group disability loss ratio rose due to increased claims in paid family and medical leave, but was somewhat offset by favorable long-term disability assumptions. Premium growth remained steady at 2%, aided by high retention rates. Expenses rose due to higher staffing costs and technology investments. Their investment portfolio performed well, maintaining a strong credit quality with an A+ rating and yielding $659 million in net investment income. Benefits from higher rates and strategic trading were highlighted by an increase in reinvestment yields.

The paragraph discusses the financial performance and capital management activities of a company. The company reports a 3% annualized LP return, improved from the first half of the year, due to better performance in private equity and real estate. Confident about long-term LP returns, they highlight a common quarterly dividend increase of 11% and share repurchases totaling 3.7 million shares for $400 million this quarter, with plans to maintain this level in the fourth quarter. The company expresses satisfaction with their financial results for the third quarter and the first nine months, aiming to continue delivering strong returns for stakeholders. Following this summary, Brian Meredith from UBS asks questions about a $32 million adjustment related to an increase in loss picks for general liability, which Chris Swift attributes to higher attorney representation in claims.

In the paragraph, Chris Swift and Beth Costello discuss adjustments made to liability figures for the year, noting that the increase recorded this quarter includes true-ups from the first and second quarters. Brian Meredith asks if recent developments in general liability (GL) affect their approach to new business in the middle market. Chris Swift expresses confidence in their current strategy, citing improvements in data science, analytics, and pricing tools. Morris Tooker adds that the company has been proactive in managing limits, jurisdictions, and fleet sizes, resulting in reduced claim frequencies.

The paragraph discusses the performance and strategy of a company's insurance lines. The speaker notes that claims frequency has decreased from 2020 to 2023 compared to prior years, suggesting their strategies are effective. They mention higher pricing standards in certain areas for Commercial Lines and express confidence in their execution. They highlight that their nine-month underlying combined ratio is consistent with the previous year, indicating successful pricing strategies. Gregory Peters from Raymond James asks about long-term targets for the Personal Lines business, particularly regarding the combined ratio. Chris Swift responds by emphasizing their focus on achieving overall profitability and a target return on equity (ROE) of 15% to 17%, rather than providing specific combined ratio targets. They mention that about 85% of states have achieved rate adequacy.

In the paragraph, Gregory Peters questions Chris Swift about the homeowners insurance business's performance, noting the consistent mid-teens rate increases and wondering why the underlying combined ratio hasn't improved more significantly. Chris Swift responds positively, explaining that while loss cost trends are increasing, the company is effectively managing attritional losses and addressing elevated catastrophic (CAT) events. He expresses confidence in meeting target margins and highlights the success of their new product, Prevail. Melinda Thompson adds that rate increases are comfortably ahead of the loss trend. Peters clarifies he's not disappointed, just seeking to understand the numbers better. The conversation then shifts to the next question by Andrew Kligerman from TD Cowen.

In the paragraph, Andrew Kligerman discusses solid growth in commercial net written premiums across various sectors, noting figures like 10% growth in small businesses, 8% in mid-large, and 9% in specialty. He estimates a 3% policy in force growth and asks about market share potential in these areas. Chris Swift and Morris Tooker respond positively, highlighting successful growth strategies and investments in pricing and data science. They emphasize growth in small and large commercial segments, including rapid growth in global specialty and E&S, while noting that the current environment remains favorable for growth, without plans to expand workers' compensation.

The paragraph discusses the company's outlook on workers' compensation and group benefits. While workers' comp remains stable in terms of written premiums, there is optimism about continued opportunities fueled by strong performance from underwriters and sales teams. In group benefits, the company achieved an 8.7% margin, surpassing its guidance of 6% to 7%, despite sales being down by 15% from the previous year. The competitive landscape and pricing for the endemic state have impacted life sales. However, there is confidence in new products, particularly in absence management and paid family and medical leave. Overall, the market remains competitive, yet the sales team is active and new business activity is strong.

The paragraph involves a conversation between Chris Swift and Ryan Tunis about the state of life insurance sales and pricing strategies in a competitive market. Chris Swift emphasizes their persistence and high retention rates, noting they aim to differentiate their products through service capabilities rather than just price competition. A significant portion of national account renewals is nearly complete, and more details will be shared in the next quarterly results. Despite the competitiveness, Swift is confident in their strategy, especially concerning long-term rate guarantees. Ryan Tunis inquires about trends in group disability claims, given the volatile macro environment, to which Chris Swift responds, suggesting it has generally remained consistent with previous observations.

The paragraph is a discussion from a conference call, where Chris Swift and Beth Costello respond to Bob Huang's question about workers' compensation reserving. Chris notes they are evaluating reserves without distinguishing between pre-COVID and post-COVID years, focusing instead on aggregate trends. Beth adds that they review reserves quarterly and will adjust as needed but cannot predict future reserve developments. She mentions that reserves from the post-COVID years ('21, '22, '23) are still young, so they are waiting to see how they develop before making any adjustments. Bob also asks about the weaker or possibly negative pricing environment for workers' compensation.

The discussion revolves around the profitability and stability of a business in the context of rising medical cost inflation and workers' compensation. Chris Swift expresses confidence in the stable trends of medical severity within a 5% assumption, viewing the business as highly profitable, especially for industry leaders. The company plans to be selective with new business and cautious about states with significant price adjustments. Overall, they feel good about their assumptions and earnings growth. Beth Costello concurs with Swift's assessment. David Motemaden from Evercore asks about the underlying loss ratio in Commercial Lines, seeking clarification on whether any aspects are one-off or unsustainable. Swift passes the question to Beth for further insights.

The paragraph discusses a financial update on a company's expense ratio, which stands at 88.1 through the first nine months, and indicates satisfaction with the performance, especially in non-catastrophe property losses. While there is favorability in non-CAT property for small commercial lines, the impact is minor. However, there are ongoing adverse developments in commercial auto, similar to the previous quarter, linked to a few specific accounts. The company had previously adjusted its loss projections for commercial auto in response to broader trends.

The paragraph discusses the current state of an insurance company's underwriting strategy and market conditions, particularly concerning auto and general liability (GL) exposures. Morris Tooker mentions efforts in managing accounts from accident years 2022 and 2023 by shifting clients to loss-sensitive policies or eliminating certain accounts, especially in the auto lines where rates are being pushed aggressively. Heavy trucking exposure in their wholesale book is minimal and managed transactionally. Following this, Michael Zaremski from BMO Capital Markets asks about rising general liability loss trends, noting a higher attorney involvement in smaller commercial claims compared to large accounts like Fortune 500 companies. He seeks more detailed insights into the impact of these trends on different business sizes or types.

The paragraph features a discussion involving Chris Swift, Morris Tooker, and Michael Zaremski about the increasing presence of lawyers in insurance claims and its impact on settlement rates. Chris Swift notes that more claims are coming in with attorneys, which is raising settlement rates across various regions and sectors. Morris Tooker adds that the company is addressing this by tailoring underwriting efforts based on various factors like industry and region. Michael Zaremski then shifts the focus to the commercial rate environment, observing disciplined pricing increases despite healthy industry return on equity levels. Chris Swift concludes by suggesting that pricing is primarily influenced by loss trends, although he can't speak for competitors' strategies.

The paragraph discusses the challenges and strategies in the current underwriting environment. Morris Tooker emphasizes the difficulty of maintaining underwriting margins and the importance of providing underwriters with the right tools, such as investments in data science, to avoid missing key insights. He commends his team's efforts in navigating the market. Elyse Greenspan from Wells Fargo asks about the slowdown in premium growth in middle and large markets, noting the impact of easier comparisons from the previous year. Chris Swift acknowledges the situation and notes that the market didn't align with their expectations in July last year.

The paragraph discusses the positive growth in middle and large commercial sectors, with a year-to-date growth of 9.9%. The company is benefiting from a trend where agents are consolidating carriers. Concerns are raised about adverse developments in General Liability (GL) claims, particularly for slip and fall cases, as they are seeing increased settlement values. Chris Swift acknowledges these challenges but refrains from detailing specific strategies, while Beth Costello agrees with Swift's assessment.

The paragraph discusses a financial report and Q&A session involving company representatives and analysts. Elyse Greenspan thanks the speaker, and an unidentified analyst, standing in for Meyer Shields from KBW, inquires about the company's personal lines expense ratio. Chris Swift responds that there are no significant changes from the last quarter, noting that the expense ratio should decrease over time as the company grows. The analyst also asks about the company's Excess and Surplus (E&S) growth. Chris Swift explains that E&S remains a strong channel, particularly for casualty and property products, and the company is on track to meet its $300 million E&S binding target for the year, especially in the small commercial sector.

The paragraph is part of a discussion during a financial earnings call. Chris Swift and Mike Fish discuss the group's sales growth in group benefits, acknowledging that year-over-year sales comparisons may not accurately reflect their performance due to multiyear sales cycles. They emphasize that the first quarter is more significant than the third quarter for sales. Although there is no detailed discussion about 2025 renewals, Swift assures that detailed information will be provided when finalized. They feel positive about their sales team and broker relationships despite some distortions in the comparison caused by previous onetime PFL (Paid Family Leave) and PML (Project Management Life cycle) sales.

The paragraph discusses a business strategy focusing on customer retention and pricing discipline to maintain profitability. Mike Fish highlights that a third of their clients renew annually, with a persistency rate over 90% for existing customers, suggesting strong competitiveness on renewals. New business quotes remain steady, but the company is selective with larger opportunities due to underwriting strategies. Joshua Shanker acknowledges the business's profitability, noting impressive margins, and inquires about competitors possibly reducing prices or accepting higher benefit ratios. Chris Swift refrains from speculating about competitors, emphasizing their own focus on thoughtful competition and margin maintenance.

In the paragraph, the speaker discusses the company's commitment to maintaining financial stability while offering rate guarantees for three to five years, depending on the product line. They emphasize their strategic and disciplined approach to remain relevant in the marketplace, choosing to compete thoughtfully in national accounts but also knowing when to step back. The discussion then shifts to property pricing, with Alex Scott from Barclays asking about elevated pricing in the small to mid-sized market, despite a slowdown in larger property markets. Chris Swift responds by stating that their property pricing increased by 60 basis points during the quarter, with significant growth in their Spectrum and general industry property capabilities. This strength is attributed to their focus on small and medium-sized enterprises (SMEs), even as larger property markets face challenges.

The paragraph is a segment from a conference call involving a discussion on the impact of storms on the market and reinsurance renewals. Alex Scott inquires about the A&E reserve review expected in the fourth quarter, seeking insights into claim trends. Chris Swift and Beth Costello indicate that the review and study are not yet complete, and they will provide information with the fourth-quarter report. The call concludes with Susan Spivak Bernstein thanking participants and offering assistance for additional questions, before the operator ends the call.

This summary was generated with AI and may contain some inaccuracies.