Second Quarter 2024 Second Quarter 2024 Results
NEWS RELEASE
The Hartford Announces Outstanding Second Quarter 2024 Financial Performance
Board Authorized New
-
- Second quarter 2024 net income available to common stockholders of
$733 million
($2.44 per diluted share) increased 35% from$542 million ($1.73 per diluted share) over the same period in 2023. Core earnings* of$750 million ($2.50 core earnings per diluted share*) increased 28% from$588 million ($1.88 core earnings per diluted share) over the same period in 2023. - Net income ROE of 19.8% and core earnings ROE* of 17.4%.
- Property & Casualty (P&C) written premiums rose 12% in second quarter 2024, driven by Commercial Lines and Personal Lines premium growth of 11% and 14%, respectively.
- Commercial Lines second quarter combined ratio of 89.8 and underlying combined ratio* of 87.4.
- P&C current accident year (CAY) catastrophe (CAT) losses in second quarter 2024 of
$280 million , before tax, or 7.1 points on the combined ratio, compared with$226 million , or 6.2 points on the combined ratio, in second quarter 2023. - Group Benefits second quarter net income margin of 9.7% and core earnings margin* of 10.0%.
- Board of Directors authorized a new
$3.3 billion share repurchase program, effective fromAug. 1, 2024 , through the end of 2026.
* Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures.
- Second quarter 2024 net income available to common stockholders of
- All amounts and percentages set forth in this news release are approximate unless otherwise noted.
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"The
The
Swift continued, "The excellent financial performance in the first half of 2024 reflects the effectiveness of our strategy and on-going investments to differentiate The
2
CONSOLIDATED RESULTS:
Three Months Ended
|
|
|
Change |
|
|
($ in millions except per share data) |
2024 |
2023 |
|
|
Net income available to common stockholders |
|
|
35% |
|
Net income available to common stockholders per diluted share1 |
|
|
41% |
|
Core earnings |
|
|
28% |
|
Core earnings per diluted share |
|
|
33% |
Book value per diluted share
Book value per diluted share (ex. accumulated other comprehensive income (AOCI))2
Net income available to common stockholders' retuon equity (ROE)3, last 12- months
19.8% 14.4% 5.4
|
Core earnings ROE3, last 12-months |
17.4% |
13.6% |
3.8 |
- Includes dilutive potential common shares; for net income available to common stockholders per diluted share, the numerator is net income less preferred dividends
- Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures
- Retuon equity (ROE) is calculated based on last 12-months net income available to common stockholders and core earnings, respectively; for net income ROE, the denominator is common stockholders' equity including AOCI; for core earnings ROE, the denominator is common stockholders' equity excluding AOCI
Second quarter 2024 net income available to common stockholders of
Second quarter 2024 core earnings of
- An increase in earnings generated by 9% growth in P&C earned premium.
- Net favorable prior accident year development (PYD) in core earnings of
$78 million , before tax, in 2024 compared with net favorable PYD of$39 million in core earnings in 2023. Net favorable PYD in second quarter 2024 primarily included reserve reductions in workers' compensation, catastrophes, personal lines, and bond, partially offset by reserve increases in general liability, assumed reinsurance, and commercial auto liability. - Commercial Lines loss and loss adjustment expense ratio of 58.4 improved 1.3 points compared with 59.7 in second quarter 2023, including 1.3 points of more favorable PYD and 0.7 points of higher CATs. Underlying loss and loss adjustment expense ratio* of 56.1 compared with 56.8 in second quarter 2023, with the improvement largely due to lower non-CAT property losses.
- Personal Lines loss and loss adjustment expense ratio of 81.0 improved 8.2 points compared with 89.2 in second quarter 2023, including 3.6 points of more favorable PYD and 1.1 points of higher CATs. Underlying loss and loss adjustment expense ratio of 70.3 compared with 76.1 in second quarter 2023, with the improvement largely due to the impact of earned pricing increases, partially offset by an increase in severity in auto and homeowners as expected.
3
- P&C CAY CAT losses of
$280 million , before tax, in second quarter 2024, compared withCAY CAT losses of$226 million in second quarter 2023. - Group Benefits loss ratio of 68.9 improved 3.2 points compared with 72.1 due to lower claim severity in group life, lower long-term disability claim incidence and a higher
New York paid family leave risk adjustment benefit, partially offset by a higher loss ratio in paid family and medical leave products. - Net investment income of
$602 million , before tax, compared with$540 million in second quarter 2023, primarily driven by higher invested assets and higher yields on our fixed income portfolio.
Book value per diluted share (excluding AOCI) of
Net income available to common stockholders' ROE (net income ROE) for the 12-month period ending
Core earnings ROE for the 12-month period ending
BUSINESS RESULTS:
Commercial Lines
|
Three Months Ended |
|||
|
|
|
Change |
|
|
($ in millions, unless otherwise noted) |
2024 |
2023 |
|
|
Net income |
|
|
18% |
|
Core earnings |
|
|
12% |
|
Written premiums |
|
|
11% |
|
Underwriting gain1 |
|
|
26% |
|
Underlying underwriting gain1 |
|
|
16% |
|
Losses and loss adjustment expense ratio |
|||
|
Current accident year before catastrophes |
56.1 |
56.8 |
(0.7) |
|
Current accident year catastrophes |
5.0 |
4.3 |
0.7 |
|
Favorable prior accident year development |
(2.6) |
(1.3) |
(1.3) |
|
Expenses |
31.1 |
31.3 |
(0.2) |
|
Policyholder dividends |
0.3 |
0.2 |
0.1 |
|
Combined ratio |
89.8 |
91.2 |
(1.4) |
|
Impact of catastrophes and PYD on combined ratio |
(2.4) |
(3.0) |
0.6 |
|
Underlying combined ratio |
87.4 |
88.3 |
(0.9) |
- Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures
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Second quarter 2024 net income of
Commercial Lines core earnings of
- 8% growth in earned premium.
- Net investment income of
$402 million , before tax, compared with$364 million in second quarter 2023. - An underlying loss and loss adjustment expense ratio of 56.1, in second quarter 2024 compared with 56.8 in second quarter 2023, with the improvement primarily driven by lower non-CAT property losses.
- Net favorable PYD within core earnings of
$44 million , before tax, in second quarter 2024, compared with$38 million of net favorable PYD within core earnings in second quarter 2023. The net favorable PYD in second quarter 2024 primarily includes reserve reductions in workers' compensation, catastrophes, and bond, partially offset by reserve increases in general liability, assumed reinsurance, and auto liability. CAY CAT losses of$155 million , before tax, in second quarter 2024, primarily from tornado, wind and hail events across several regions ofthe United States , but concentrated in the South and Midwest, up fromCAY CAT losses of$123 million in second quarter 2023.
Combined ratio of 89.8 in second quarter 2024, improved from 91.2 in second quarter 2023, primarily due to a 1.3 point improvement in the loss and loss adjustment expense ratio, including
- points of more favorable PYD (including 1.2 points of favorable development related to the amortization of the deferred gain) partially offset by 0.7 points of higher
CAY CAT losses. Underlying combined ratio of 87.4 improved from 88.3 in second quarter 2023 primarily due to a
- point decrease in the underlying loss and loss adjustment expense ratio.
-
- Small Commercial combined ratio of 88.7 improved from 90.8 in second quarter 2023, including 0.3 points of less favorable PYD and 0.4 points of higher CAY CATs. Underlying combined ratio of 86.8 compared with 89.7 in second quarter 2023 primarily due to lower non-CAT property losses.
- Middle & Large Commercial combined ratio of 95.9 compared with 93.6 in second quarter 2023, driven by 1.0 points of higher CAY CATs and 0.3 points of more unfavorable PYD. Underlying combined ratio of 89.6 compared with 88.7 in second quarter 2023, primarily due to higher non-CAT property losses compared with a favorable non-CAT experience in the prior year, partially offset by a lower expense ratio.
- Global Specialty combined ratio of 83.4 compared with 87.3 in second quarter 2023, driven by 5.0 points of more favorable PYD, partially offset by 0.9 points of higher CAY CATs. The combined ratio included 4.4 points of favorable development due to the amortization of the deferred gain related to the Navigators ADC. Underlying combined ratio of 85.2 compared with 85.0 in second quarter 2023.
Second quarter 2024 written premiums of
5
Personal Lines
|
Three Months Ended |
|||
|
|
|
Change |
|
|
($ in millions, unless otherwise noted) |
2024 |
2023 |
|
|
Net loss |
( |
|
82% |
|
Core loss |
( |
|
93% |
|
Written premiums |
|
|
14% |
|
Underwriting loss |
|
|
44% |
|
Underlying underwriting gain (loss) |
|
|
NM |
|
Losses and loss adjustment expense ratio |
|||
|
Current accident year before catastrophes |
70.3 |
76.1 |
(5.8) |
|
Current accident year catastrophes |
14.7 |
13.6 |
1.1 |
|
Favorable prior accident year development |
(4.0) |
(0.4) |
(3.6) |
|
Expenses |
26.4 |
25.7 |
0.7 |
|
Combined ratio |
107.4 |
114.9 |
(7.5) |
|
Impact of catastrophes and PYD on combined ratio |
(10.7) |
(13.2) |
2.5 |
|
Underlying combined ratio |
96.7 |
101.7 |
(5.0) |
Net loss of
Personal Lines core loss of
2023. Contributing to the results were:
- 12% growth in earned premium.
- An underlying loss and loss adjustment expense ratio of 70.3 in second quarter 2024 improved from 76.1 in second quarter 2023, primarily driven by the impact of earned pricing increases, partially offset by an increase in severity in auto and homeowners as expected.
$34 million , before tax, of favorable PYD in second quarter of 2024, compared with$3 million favorable PYD in second quarter 2023. The net favorable PYD in second quarter 2024 is driven by reserve reductions in auto liability related to property damage, homeowners and auto physical damage.- Net investment income of
$50 million , before tax, in second quarter 2024 compared with$34 million in second quarter 2023. CAY CAT losses of$125 million , before tax, in second quarter 2024, primarily from tornado, wind and hail events across several regions ofthe United States , but concentrated in the South and Midwest, up from$103 million ofCAY CAT losses in second quarter 2023.
Combined ratio of 107.4 in second quarter 2024, improved from 114.9 in second quarter 2023, primarily due to an 8.2 point improvement in the loss and loss adjustment expense ratio, including 3.6 points of more favorable PYD and a 5.8 point improvement in the underlying loss and loss adjustment expense ratio, partially offset by 1.1 points of higher
- Auto combined ratio of 105.4 improved from 116.4 in second quarter 2023. The underlying combined ratio of 104.9 improved from 111.8 in second quarter 2023,
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primarily due to the impact of double-digit earned pricing increases, partially offset by higher marketing expenses and an increase in auto liability and physical damage claim severity as expected.
- Homeowners combined ratio of 114.5 improved from 115.1 in second quarter 2023. The underlying combined ratio of 77.8 improved from 79.6 in second quarter 2023, primarily due to the impact of double-digit earned pricing and favorable weather and non-weather frequency, partially offset by higher marketing expenses and elevated weather and non- weather severity.
Written premiums in second quarter 2024 were
- Renewal written price increases in auto and homeowners of 23.5% and 14.9%, respectively, in response to elevated loss cost trends.
- An increase in new business in both auto and homeowners from second quarter 2023 of
$30 million , or 58%, and$25 million , or 114%, respectively. - Lower effective policy count retention, driven by auto, due to renewal written price increases.
Group Benefits
Three Months Ended
|
($ in millions, unless otherwise noted) |
|
|
Change |
|
2024 |
2023 |
||
|
Net income |
|
|
41% |
|
Core earnings |
|
|
34% |
|
Fully insured ongoing premiums |
|
|
2% |
|
Loss ratio |
68.9% |
72.1% |
(3.2) |
|
Expense ratio |
24.4% |
24.5% |
(0.1) |
|
Net income margin |
9.7% |
7.0% |
2.7 |
|
Core earnings margin |
10.0% |
7.6% |
2.4 |
Net income of
Fully insured ongoing premiums were up 2% compared with second quarter 2023, including an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year period. Fully insured ongoing sales were
Loss ratio of 68.9 improved from 72.1 in second quarter 2023.
- Group life loss ratio of 74.9 improved 9.2 points largely driven by lower claim severity experience.
- Group disability loss ratio of 67.1 was essentially flat with second quarter 2023, driven by lower long-term disability claim incidence and a higher
New York paid family leave risk adjustment benefit, offset primarily by a higher loss ratio in paid family and medical leave products.
7
Net investment income of
Hartford Funds
Three Months Ended
|
($ in millions, unless otherwise noted) |
|
|
Change |
|
2024 |
2023 |
||
|
Net income |
|
|
(2)% |
|
Core earnings |
|
|
(2)% |
|
Daily average Hartford Funds AUM |
|
|
5% |
|
Mutual Funds and exchange-traded funds (ETF) net flows |
|
|
14% |
|
Total Hartford Funds AUM |
|
|
4% |
Second quarter 2024 net income of
Core earnings of
Daily average AUM of
Mutual fund and ETF net outflows totaled
Corporate
|
Three Months Ended |
|||
|
|
|
Change |
|
|
($ in millions, unless otherwise noted) |
2024 |
2023 |
|
|
Net loss |
|
|
35% |
|
Net loss available to common stockholders |
|
|
29% |
|
Core loss |
|
|
9% |
|
Net investment income, before tax |
|
|
75% |
|
Interest expense and preferred dividends, before tax |
|
|
-% |
Net loss available to common stockholders of
Second quarter 2024 core loss of
8
INVESTMENT INCOME AND PORTFOLIO DATA:
|
Three Months Ended |
|||
|
($ in millions, unless otherwise noted) |
|
|
|
|
2024 |
2023 |
Change |
|
|
Net investment income, before tax |
|
|
11% |
|
Annualized investment yield, before tax |
4.1% |
3.9% |
0.2 |
|
Annualized investment yield, before tax, excluding LPs1 |
4.4% |
4.0% |
0.4 |
|
Annualized LP yield, before tax |
1.3% |
2.9% |
(1.6) |
|
Annualized investment yield, after tax |
3.3% |
3.1% |
0.2 |
- Denotes financial measure not calculated in accordance with generally accepted accounting principles (non-GAAP); definitions of non-GAAP measures and reconciliations to their closest GAAP measures can be found in this news release under the heading Discussion of Non-GAAP Financial Measures
Second quarter 2024 consolidated net investment income of
Second quarter 2024 included
Net realized losses of
Total invested assets of
9
CONFERENCE CALL
The
More detailed financial information can be found in The
About The
The
additional details, please read https://www.thehartford.com/legal-notice.
HIG-F
From time to time, The
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Media Contacts: |
Investor Contact: |
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860-547-7413 |
860-547-6233 |
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860-547-8664 |
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Attachments
Disclaimer
2Q 2024 Financial Supplement
Second Quarter 2024 Investor Financial Supplement
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