HARTFORD INSURANCE GROUP (HIG)·Q4 2025 Earnings Summary

Hartford Delivers Record 19.4% ROE as Business Insurance Fuels Blowout Q4

January 30, 2026 · by Fintool AI Agent

The Hartford delivered outstanding Q4 2025 results, with core earnings of $1.15 billion ($4.06 per share) crushing estimates and capping off a year that saw the insurer achieve an industry-leading 19.4% core earnings ROE. The stock rose 2.9% in after-hours trading to $134.47 as investors cheered the eighth consecutive quarter of strong execution.

Did The Hartford Beat Earnings?

Yes, decisively. The Hartford beat on both lines:

The beat was driven by excellent underwriting results across both P&C segments, with the combined ratio improving to 87.1 from 92.1 a year ago. Net investment income also contributed, rising 17% to $832 million on strong limited partnership returns.

What Drove the Outperformance?

Business Insurance: The Engine

Business Insurance, representing 56% of the company, delivered core earnings of $915 million (+38% YoY) with a standout combined ratio of 83.6.

Key drivers included:

• Small Business: 9% premium growth with double-digit new business growth
• Global Specialty: 5% premium growth, combined ratio of 78.1
• Favorable reserve development: $152M of favorable prior-year development vs. $0M in Q4 2024

Personal Insurance: Turnaround Continues

Personal Insurance achieved core earnings of $214 million (+38% YoY) with a combined ratio of 79.6, reflecting the sustained impact of pricing actions.

Renewal written price increases remained strong at 10.4% for auto and 11.9% for homeowners, though moderating from prior quarters as the book returns to target profitability.

What Did Management Say?

CEO Christopher Swift emphasized execution and AI-driven innovation:

"The Hartford delivered an outstanding year, with core earnings of $3.8 billion and a core earnings ROE of 19.4 percent. Results were driven by excellent performance in Business Insurance, which once again generated robust top-line growth at highly profitable margins, a pivotal year in Personal Insurance that restored target profitability in auto, strong margins in Employee Benefits, and solid performance from our investment portfolio."

On technology leadership, Swift was bullish:

"With the foundational work across platforms, data, and cloud largely complete, we have moved to the next phase of our innovation agenda, reimagining our processes and workflows with an AI-first mindset. The team is executing well, and we are already seeing early positive results in claims where AI is accelerating medical record summarization, in underwriting where it is providing more consistent data-rich insights with greater precision."

On small business dominance:

"For the seventh consecutive year, Keynova Group has ranked The Hartford as the number one carrier for small business digital capabilities. Keynova reported that The Hartford holds a double-digit lead in all categories."

CFO Beth Costello highlighted capital strength:

"Given our strong capital generation, beginning with the first quarter, we expect to increase quarterly share repurchases to $450 million, subject to market conditions."

How Did the Stock React?

The Hartford stock rose +1.3% during regular trading on January 29, closing at $132.37. In after-hours trading following the earnings release, shares jumped an additional +1.6% to $134.47, representing a total gain of +2.9% from the prior close.

The positive reaction reflects continued confidence in Hartford's execution and the sustainability of its strong underwriting margins.

Capital Return: $2.2 Billion in 2025

Hartford returned $546 million to shareholders in Q4 2025, including $400 million in share repurchases and $146 million in dividends. For the full year, the company returned $2.2 billion:

Book value per diluted share (excluding AOCI) reached $73.62, up 13% from $64.95 at year-end 2024. The company has $1.55 billion remaining on its $3.3 billion repurchase authorization through December 2026.

Investment Portfolio: Strong LP Returns

Net investment income of $832 million increased 17% from Q4 2024, driven by:

The LP yield hit 11.4% in Q4, driven by strong private equity returns. The core fixed income portfolio maintains an A+ average credit rating with duration of 3.9 years.

Full Year 2025 Summary

Q&A Highlights: What Analysts Asked

Pricing Sustainability in Small Business

Asked about how long Hartford can sustain favorable renewal pricing in small business, CEO Chris Swift emphasized structural advantages:

"We have built a wonderful, smooth-running machine that is differentiated in the marketplace... I think the opportunity for us is really sky's the limit. This is a structural, strategic shift in some of those activities that we're gonna be clear beneficiary of."

COO Mo Tooker added that Hartford's digital capabilities help agents save money: "We're proving to agents and brokers they can save a penny or two on every dollar they put with us relative to competitors."

2026 Margin Outlook

When pressed on Business Insurance underlying margins for 2026, Swift was cautiously optimistic:

"We're going to refrain from any specific numbers or ranges... Our starting position is very strong. We had an 88.5 Underlying Combined Ratio this year. We've instructed our underwriters to try to hold on to margins to the extent possible."

Swift noted renewal written pricing ex-comp of 6.1% is "within a couple tenths of loss cost trends," suggesting margins should remain relatively stable.

Technology as a Game Changer

Asked if AI could be a major differentiator, Swift was emphatic:

"Yes and yes. I think it is a game changer, and I think scale matters then to invest over a multi-year period of time to sort of reinvent your workflows and your customer experiences... I definitely can see a have and a have not type of opportunity."

Expense Ratio Targets

Swift provided specific expense ratio targets for 2027:

• Business Insurance: Below 30% (currently 31.8%)
• Personal Insurance: Below 25% (currently 26.2%)
• Employee Benefits: Around 25% range

E&S Binding Growth

The E&S binding business in small commercial grew 30% Q4/Q4 and 35% for the full year, with expectations for a $300M+ premium business in 2026.

Winter Storm Fern Impact

CFO Beth Costello characterized Winter Storm Fern as "very manageable" and "not comparable to Uri" based on early claims activity.

2026 Outlook: Accelerating Capital Return

Hartford provided robust capital return expectations for 2026:

Increased Share Buybacks

Beginning Q1 2026, quarterly buybacks increase from $400M to $450M (subject to market conditions), representing $1.8B annualized.

Operating Company Dividends

Net dividends from operating companies expected at ~$2.9 billion in 2026, up 16% from 2025.

Growth Targets

• Property premium: $3.6-$3.7B target (10-11% growth from $3.3B in 2025)
• E&S binding: $300M+ premium expected
• Employee Benefits sales: Known sales up 45-50% YoY through January
• Prevail Agency: 30 state launches planned by early 2027 (from 10 currently)

Key Risks to Monitor

1. California Wildfires: The company recorded $305 million (net of reinsurance) from the January 2025 California wildfire event, impacting Q1 2025 results.

2. Asbestos & Environmental Reserves: Q4 included a $165 million charge for A&E reserve strengthening, a recurring headwind from legacy liabilities.

3. Workers' Compensation Pricing: Renewal pricing excluding workers' comp was 6.1% in Q4, suggesting continued pressure in this line.

4. Personal Insurance Policy Counts: Auto policies in-force declined to 1.05 million from 1.17 million as pricing actions impact retention.

The Bottom Line

The Hartford's Q4 2025 results demonstrate why the company trades at a premium to peers. With a 19.4% core ROE, industry-leading combined ratios, and a proven capital return track record, Hartford enters 2026 from a position of strength. The pivot to profitability in Personal Insurance—combined with continued execution in Business Insurance—positions the company for another year of strong returns.

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Updated January 30, 2026 with Q&A highlights from the earnings call.

Data sources: Company filings, earnings call transcript, S&P Global