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    Hartford Financial Services Group Inc (HIG)

    Board Change

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    Business Description

    The Hartford Financial Services Group, Inc. (HIG) is a diversified insurance and investment company operating primarily in five reporting segments: Commercial Lines, Personal Lines, Property & Casualty Other Operations, Group Benefits, and Hartford Funds, along with a Corporate category . The company offers a range of insurance products, including workers' compensation, property, automobile, general liability, and professional liability, primarily targeting small businesses, middle market companies, and national accounts . Additionally, Hartford provides group life, accident, and disability coverage, investment management services, and products like mutual funds and ETFs .

    1. Commercial Lines - Offers insurance products such as workers' compensation, property, automobile, general liability, and professional liability, primarily targeting small businesses, middle market companies, and national accounts.
    2. Group Benefits - Provides group life, accident, and disability coverage, along with other products like voluntary benefits and group retiree health.
    3. Personal Lines - Provides automobile, homeowners, and personal umbrella coverages, with a significant portion of business coming from a program designed for AARP members.
    4. Hartford Funds - Offers investment management services and products, including mutual funds and ETFs.
    5. Property & Casualty Other Operations - Encompasses various other insurance-related activities not included in the main segments.

    Key Metrics

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    Executive Team

    NamePositionStart DateShort Bio
    Jonathan R. BennettExecutive Vice President and Head of Group BenefitsAugust 2019Jonathan R. Bennett has been the Executive Vice President and Head of Group Benefits since August 2019. He was previously the CFO and Head of Strategy for Property and Casualty and Group Benefits .
    Claire H. BurnsChief Marketing and Communications OfficerSeptember 2021Claire H. Burns has served as the Chief Marketing and Communications Officer since September 2021. She was previously the Chief Marketing and Strategy Officer at Prudential International .
    Stephanie C. BushExecutive Vice President and Head of Personal Lines (Retiring March 1, 2024)January 2018Stephanie C. Bush has been the Executive Vice President and Head of Personal Lines since January 2018. She announced her retirement effective March 1, 2024 .
    Beth A. CostelloExecutive Vice President and Chief Financial OfficerJuly 1, 2014Beth A. Costello has been the Executive Vice President and Chief Financial Officer since July 1, 2014, overseeing finance, treasury, capital, accounting, investor relations, procurement, and actuarial functions .
    Michael R. FisherExecutive Vice President and Property and Casualty Chief Underwriting OfficerMay 2019Michael R. Fisher has been the Executive Vice President and Property and Casualty Chief Underwriting Officer since May 2019. He was previously the Executive Vice President and Head of Specialty Commercial .
    John J. KinneyExecutive Vice President, Head of Claims & OperationsAugust 2021John J. Kinney has been the Executive Vice President, Head of Claims & Operations since August 2021. He was previously the Chief Claims Officer .
    Allison G. NidernoSenior Vice President and ControllerMarch 2023Allison G. Niderno has been the Senior Vice President and Controller since March 2023. She was previously Vice President Finance, Head of External Reporting and Investment Finance .
    Robert W. PaianoExecutive Vice President and Chief Risk OfficerJune 2017Robert W. Paiano has been the Executive Vice President and Chief Risk Officer since June 2017. He was previously the Senior Vice President & Treasurer .
    David C. RobinsonExecutive Vice President and General Counsel (Retiring March 1, 2024)June 1, 2015David C. Robinson has been the Executive Vice President and General Counsel since June 1, 2015. He announced his retirement effective March 1, 2024 .
    Lori A. RoddenExecutive Vice President and Chief Human Resources OfficerOctober 2019Lori A. Rodden has been the Executive Vice President and Chief Human Resources Officer since October 2019. She was previously the Senior Vice President and Lead HR Business Partner for various departments .
    Deepa SoniExecutive Vice President, Head of Technology, Data, Analytics & Information SecurityAugust 2, 2021Deepa Soni has been the Executive Vice President, Head of Technology, Data, Analytics & Information Security since August 2, 2021. She will also assume responsibility for customer-facing operations starting March 2024 .
    Amy M. StepnowskiExecutive Vice President and Chief Investment OfficerAugust 2020Amy M. Stepnowski has been the Executive Vice President and Chief Investment Officer since August 2020. She is also the President of Hartford Investment Management Company (HIMCO) .
    Adin M. TookerExecutive Vice President, Middle & Large Commercial, Global Specialty and Sales and DistributionNovember 2022Adin M. Tooker has been the Executive Vice President, Middle & Large Commercial, Global Specialty and Sales and Distribution since November 2022. He was previously the EVP and Head of Middle & Large Commercial .

    Questions to Ask Management

    1. In the Personal Lines segment, can you provide specific targets for your longer-term combined ratio given the recent trends, and explain how you plan to achieve them, especially in the context of increased advertising expenses?
    2. Regarding the upcoming A&E reserve review, can you discuss any preliminary trends or factors that might impact reserve levels, and how you are preparing for potential changes in those liabilities?
    3. Group Benefits sales are down 15% from the prior year despite strong margins; how do you plan to address the competitive pressures and decline in new business to drive growth in this segment?
    4. In a competitive market with rising loss trends and healthy industry ROEs, how are you balancing pricing increases to maintain growth while ensuring underwriting discipline across your commercial lines?
    5. Your Group Benefits margins are currently above your 6% to 7% guidance at 8.7%; what factors are driving the expectation of a margin decrease, and how will this affect your strategic priorities in this segment?

    Share Repurchase Program

    Program DetailsProgram 1Program 2
    Approval DateJuly 28, 2022 July 25, 2024
    End Date/DurationDecember 31, 2024 December 31, 2026
    Total additional amount$3.0 billion $3.3 billion
    Remaining authorization$0.2 billion $3.3 billion
    DetailsPart of $3.5 billion remaining under both programs Part of $3.5 billion remaining under both programs

    Customer Concentration

    CustomerRelationshipSegmentDetails
    AARP
    Exclusive licensing agreement to market insurance to AARP’s ~38 million members
    Personal Lines
    Contributed $2.9BIn earned premiums in 2023 (~11.8% of total revenue of $24,527M), $2.7B in 2022, $2.7B in 2021

    Auditor

    NameStart DateEnd DateReason for Change
    Deloitte & Touche LLP2002PresentCurrent auditor
    Citation: Deloitte & Touche LLP has served as the auditor of The Hartford Financial Services Group, Inc. since 2002.  **[0000874766-24-000016_hig-20231231.htm:168]**

    Latest news

    Recent developments and announcements about HIG.

    Financial Reporting

      Earnings Call

      ·
      5 days ago

      The Hartford (HIG) recently released its earnings call transcript, providing insights into its financial performance and strategic initiatives for the fourth quarter and full year of 2024. Below is a summary of the key points:

      Financial Performance

      • Core Earnings: The company reported core earnings of $865 million for the quarter, translating to $2.94 per diluted share, with a full-year core earnings return on equity (ROE) of 16.7%.
      • Investment Income: Net investment income for the quarter was $714 million, with an annualized portfolio yield of 4.6% before tax. The company anticipates higher net investment income in 2025 due to increased invested assets and higher yields.
      • Shareholder Returns: The Hartford repurchased 3.4 million shares for $400 million during the quarter and has $3.15 billion remaining on its share repurchase authorization through 2026.

      Segment Highlights

      • Commercial Lines: Achieved written premium growth of 6% for the quarter and 9% for the year, with an underlying combined ratio of 87.1%. Small Commercial saw 9% growth, while Middle & Large Commercial grew by 5%.
      • Personal Lines: Delivered an underwriting gain for the first time in two years, with a 17.3-point improvement in the loss ratio. Auto and homeowners segments showed strong pricing increases and new business growth.
      • Group Benefits: Core earnings margin was 7.8% for the quarter and 8.2% for the year, supported by favorable life and disability results. However, the company noted elevated loss ratios in paid family and medical leave products.

      Forward Guidance and Strategic Initiatives

      • Profitability Goals: The Hartford aims to return its auto segment to targeted profitability by mid-2025 and expects continued improvement in the underlying combined ratio for Personal Lines, targeting the mid-90s in 2025.
      • Capital Management: The company plans to continue using share repurchases and dividends as primary tools for capital management.
      • Market Conditions: Management highlighted strong renewal pricing across commercial and personal lines, with pricing outpacing loss cost trends in key segments like auto, homeowners, and general liability.

      Analyst Questions and Management Responses

      • Disability Loss Ratios: Analysts inquired about the 3.3-point increase in the disability loss ratio. Management attributed this to elevated trends in paid family and medical leave products and higher long-term disability incidences, partially offset by better recoveries.
      • General Liability Reserves: The company strengthened its general liability reserves by $130 million, reflecting higher-than-expected construction defect claims and increased severity trends. Management expressed confidence in the adequacy of reserves going forward.
      • Wildfire Exposure: Regarding the recent Los Angeles wildfires, The Hartford expects losses in both commercial and personal lines but noted that its exposure is limited due to disciplined risk management in California. The company anticipates utilizing its reinsurance program but does not expect to exceed higher layers of coverage.

      Strategic Outlook

      • The Hartford remains optimistic about its future, citing strong financial results, disciplined underwriting, and investments in technology and data science as key drivers of its competitive advantage. The company plans to sustain its growth trajectory and maintain industry-leading margins across its business segments.

    Corporate Leadership

      Board Change

      ·
      Jan 6, 2025, 4:58 PM

      Annette Rippert has been elected to the board of directors of The Hartford Financial Services Group, Inc. (HIG), effective February 18, 2025. She will serve on the board's Finance, Investment and Risk Management Committee.