Amy Stepnowski
HARTFORD INSURANCE GROUPAbout Amy Stepnowski
Executive Vice President, Chief Investment Officer, and President of Hartford Investment Management Company (HIMCO) since August 2020; age 56 as of Feb. 20, 2025; B.A. in Political Science and Spanish from Yale; Executive Education at Dartmouth’s Tuck School of Business . In 2024, HIMCO delivered outstanding portfolio performance of $2.6B before tax, materially supporting The Hartford’s core earnings and ROE (19.9% net income ROE; 16.7% core earnings ROE), underscoring investment execution under her leadership .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| The Hartford (HIMCO) | Executive Vice President, Chief Investment Officer; President, HIMCO | Aug 2020–present | Led investment portfolio that generated $2.6B before tax in 2024; expanded private equity/credit relationships; contributed to exceptional company financials . |
| The Hartford (HIMCO) | Managing Director; Head of Public Credit Research (previously VP/Senior Research Analyst – EM; High Yield coverage) | 2008–Aug 2020 | Built and led public credit research; sector expertise in media, energy, power; internal leadership/mentorship . |
| J.P. Morgan Chase & Co. | Managing Director; Latin American corporate and project finance | 12 years prior to joining The Hartford in 2008 | Structured/project finance expertise across LatAm; senior leadership experience . |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $525,000 | $587,500 | $600,000 |
| All Other Compensation ($) | $66,100 | $52,800 | $52,200 |
| Pension – Present Value at FYE ($) | Retirement Plan: $0 (no 2022 PV disclosed for that year; see 2024) | — | Retirement Plan: $90,132; Excess Pension Plan: $30,631 (credited service 4.33 yrs) |
Notes: In 2024, “All Other Compensation” primarily reflects company contributions to defined contribution plans .
Performance Compensation
| Component | Structure/Metric | Weighting/Curve | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Annual Incentive Plan (AIP) | Company “Compensation Core Earnings” vs operating plan; threshold 80%, max 200%; committee may qualitatively adjust; 2024 formulaic funding = 143% | Target payout at 100% of Compensation Core Earnings target; slope reduced around +/-5% of target; 2024 target set at $2.84B; actual $3.15B → 143% funding | $1,480,000 paid | Target $1,100,000; 117% payout; $1,287,000 paid | Target $1,100,000; 143% payout; $1,573,000 paid |
| Long-Term Incentive (LTI) Mix | 2023 awards: 50% Stock Options / 50% Performance Shares; 2024 awards: 25% Stock Options / 75% Performance Shares | 2024 PS metrics: 2/3 Compensation Core ROE (3-yr avg); 1/3 relative TSR vs 15-company peer set; TSR curve: 0%<30th, 35%@30th, 100%@55th, 200%@85th | Stock Awards (ASC 718 FV): $515,350; Options: $500,000 | Stock Awards: $602,085; Options: $550,000 | Stock Awards: $1,175,160; Options: $350,000 |
| PSU Outcomes (cycle) | 2022–2024 PSU cycle payout | ROE component 200%; TSR at 73rd percentile → 160%; Combined payout 180% | — | — | 180% certified on Feb. 18, 2025 |
2024 LTI Grant Details (Stepnowski)
| Grant | Grant date | Quantity/Terms | Vesting/Term | Accounting FV |
|---|---|---|---|---|
| Stock Options | Feb 27, 2024 | 13,582 options @ $95.74 exercise price | Vest 1/3 per year over 3 years; 10-year term | $350,000 |
| Performance Shares (target) | Feb 27, 2024 | 10,967 target PSUs; threshold 11.7% of target; max 200% | 3-year performance period (2024–2026); vesting 12/31/2026; metrics: 2/3 Compensation Core ROE; 1/3 relative TSR | $1,175,160 |
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership | 110,167 common shares as of Mar. 24, 2025 |
| Stock Options (exercisable within 60 days) | 80,668 shares may be acquired upon option exercise within 60 days as of Mar. 24, 2025 |
| Unvested Performance Shares Outstanding (at 200% for disclosure) | 2023 grant: 14,495 units; value $1,585,753 at $109.40; 2024 grant: 22,126 units; value $2,420,584 at $109.40 |
| Ownership Guidelines | Other NEOs must hold 4x salary; as of Mar. 24, 2025, each NEO met requirements |
| Hedging/Pledging | Prohibited for Senior Executives; robust insider trading policy with trading windows/10b5‑1 plans |
| Deferred Compensation (Excess Savings Plan) | 2024 executive contributions: $39,300; company match: $39,300; 2024 plan earnings: $111,782; aggregate balance at 12/31/24: $1,128,574 |
| Insider Trading Plan (Rule 10b5‑1) | Adopted Feb. 4, 2025 for potential exercise of up to 48,690 options and sale of up to 5,961 shares between May 5–Aug. 15, 2025; plan fully exercised/terminated May 5, 2025 |
Employment Terms
| Provision | Term |
|---|---|
| Employment Agreements | No individual employment agreements for Senior Executives |
| Severance Plan | If involuntary termination not for Cause (including post-CoC double trigger), lump sum = 2x (base salary + target AIP); non-compete and non-solicit for 1 year |
| Change of Control | Double-trigger vesting if awards assumed/replaced; immediate vesting if not assumed; no excise tax gross-ups |
| Clawback | Comprehensive policy covering restatements and misconduct; applies to cash/equity incentive pay |
Potential Payments to Stepnowski (as of 12/31/2024)
| Scenario | 2024 AIP Award ($) | Cash Severance ($) | Accelerated Options ($) | Accelerated PSUs ($) | Benefits/Outplacement ($) | Total ($) |
|---|---|---|---|---|---|---|
| Voluntary termination/retirement | $1,573,000 | — | $1,129,082 | $2,003,169 | — | $4,705,251 |
| Involuntary termination – not for Cause | $1,573,000 | $3,400,000 | $1,129,082 | $2,003,169 | $43,719 | $8,148,970 |
| Change of Control + qualifying termination | $1,573,000 | $3,400,000 | $1,129,082 | $2,003,169 | $43,719 | $8,148,970 |
| Death or disability | $1,573,000 | — | $1,129,082 | $2,003,169 | $69,946 | $4,775,197 |
Retirement eligibility: eligible for “retirement treatment” under Rule of 65 for AIP and 2022–2024 LTI as of Dec. 31, 2024 (affects vesting) .
2024–2022 Summary Compensation (Stepnowski)
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary ($) | $525,000 | $587,500 | $600,000 |
| Stock Awards ($) | $515,350 | $602,085 | $1,175,160 |
| Option Awards ($) | $500,000 | $550,000 | $350,000 |
| Non-Equity Incentive Plan Compensation ($) | $1,480,000 | $1,287,000 | $1,573,000 |
| Change in Pension Value & NQDC Earnings ($) | — | $13,711 | $766 |
| All Other Compensation ($) | $66,100 | $52,800 | $52,200 |
| Total ($) | $3,086,450 | $3,093,096 | $3,751,126 |
Performance & Track Record
- HIMCO portfolio generated $2.6B before tax in 2024, a key driver of core earnings and ROE; Committee highlighted talent retention and expanded private equity/credit partnerships under her leadership .
- Company delivered 2024 net income/core earnings of ~$3.1B and ROE of 19.9%/16.7% amid strong underwriting and investment income, validating investment and underwriting strategy alignment .
- 2022–2024 PSU cycle paid at 180%: ROE component at 200%; TSR ranked 73rd percentile vs performance peers (demonstrating above-median relative shareholder returns over the period) .
Compensation Structure Analysis
- Elevated pay-at-risk: LTI mix shifted to 75% performance shares in 2024 (from 50%), increasing sensitivity to operating ROE and relative TSR; stock options reduced to 25% .
- AIP rigor increased with higher 2024 Compensation Core Earnings target ($2.84B) and formulaic 143% funding tied to outperformance; Committee made no discretionary adjustments, reinforcing formula discipline .
- Best practices: double-trigger CoC, no tax gross-ups, no option repricing; comprehensive clawback and prohibition on pledging/hedging reduce governance risk .
Risk Indicators & Red Flags
- Hedging/pledging prohibited; insider trading allowed only via windows/10b5‑1 plans (mitigates alignment risks) .
- Related party transactions: none requiring review in 2024 (no conflicts identified) .
- Say‑on‑pay support ~91% in 2024 (low external compensation controversy risk) .
- Near‑term selling pressure: Rule 10b5‑1 plan (Feb–Aug 2025) authorized potential exercise/sale up to 48,690 options and 5,961 shares; plan fully exercised/terminated May 5, 2025 .
Compensation Peer Group (context for LTI TSR)
- Performance peer group of 15 P&C/life insurers used for PSU TSR (e.g., Allstate, Progressive, Travelers, Chubb, MetLife, WR Berkley, etc.); TSR curve targets above-median outcomes (target at 55th percentile) .
Investment Implications
- Strong pay-for-performance alignment: higher weighting to performance shares (ROE/TSR) plus disciplined AIP design tie realized pay to multi-year value creation and operating outperformance .
- Retention risk manageable: eligible for favorable retirement treatment on recent LTI, but severance/CoC terms (2x cash; double-trigger equity) and ownership requirements (4x salary; met) support ongoing alignment and reduce abrupt exit risk .
- Trading signal: Q2’25 completion of a pre‑set 10b5‑1 plan (option exercises and modest share sales) likely reflects portfolio diversification versus negative information; ongoing prohibitions on pledging/hedging preserve alignment .