HARTFORD FINANCIAL SERVICES GROUP INC

|

|PERSONAL LINES - RESULTS OF OPERATIONS

[1]For additional information on current accident year catastrophes and prior accident year development, see MD&A - Critical Accounting Estimates, Property & Casualty Insurance Product Reserves, Net of Reinsurance and Note 9 - Reserve for Unpaid Losses and Loss Adjustment Expenses of Notes to Condensed Consolidated Financial Statements.

[3]Includes servicing revenues of $19 and $19 for the three months ended March 31, 2024 and 2023, respectively. Includes servicing expenses of $15 and $14 for the three months ended March 31, 2024 and 2023, respectively.

[4]For discussion of income taxes, see Note 12 - Income Taxes of Notes to Condensed Consolidated Financial Statements.

Written and Earned Premiums

|

Premium Measures

Underwriting Ratios

Product Combined Ratios

|

Net Income (Loss)

Net income changed to a net gain for the three months ended March 31, 2024 compared to a net loss for the prior year period, largely driven by improved underwriting results and an increase in net investment income.

Underwriting Loss

Underwriting loss decreased driven by the effect of an increase in earned premium due to renewal written price increases and a change from unfavorable to favorable prior accident year development, partially offset by a slight increase in the current accident year loss and LAE ratio before catastrophes, an increase in current accident year catastrophe losses and an increase in direct marketing costs.

|

Expense ratio decreased primarily due to the impact of higher earned premium driven by earned pricing increases, partially offset by an increase in direct marketing costs.

Written Premiums

Earned premiums increased due to higher written premium over the prior twelve months in both automobile and homeowners.

Written premiums increased driven by the effect of written pricing increases in both automobile and homeowners.

Renewal written pricing increases were higher for both automobile and homeowners, primarily in response to recent higher loss cost trends as well as higher insured values in homeowners.

Policy count retention slightly decreased in automobile, and was stable for homeowners.

Effective Policy count retention decreased both for automobile and for homeowners in response to renewal written pricing increases.

Policies in-force declined for both automobile and for homeowners, reflecting the level of new business in relation to non-renewed policies.

Current Accident Year Loss and LAE Ratio before Catastrophes

Current accident year Loss and LAE ratio before catastrophes increased slightly in automobile and was partially offset by a decrease in homeowners. The increase in automobile was primarily due to an increase in automobile liability and physical damage claim severity, as well as a slightly higher level of frequency in the current period, mostly offset by the impact of earned pricing increases. The automobile severity increases, although moderated from prior year, continue to include the inflationary effects on bodily injury claims and automobile parts and repairs, and also include higher attorney representation rates for liability claims. For homeowners, the decrease in the current accident year loss and LAE ratio before catastrophes was due to a decrease in frequency for both weather and non-weather claims, as well as the impact of earned pricing increases, partially offset by an increase in severity for both weather and non-weather claims. Contributing to the increase in homeowners severity was the effect of higher rebuilding costs due to inflation.

|

Current Accident Year Catastrophes and Unfavorable (Favorable) Prior Accident Year Development

Current accident year catastrophe losses increased for the three months ended March 31, 2024, compared to the prior year. Current accident year catastrophe losses for 2024 included from tornado, wind and hail events, mainly in the Midwest and South regions, as well as winter storms in the Pacific and South regions. Current accident year catastrophe losses for the three months ended March 31, 2023 included tornado, wind and hail events in several regions of the United States, as well as losses from winter storms primarily on the East and West coasts.

Prior accident year development was favorable for the three months ended March 31, 2024, primarily driven by improved severity on automobile physical damage. Net unfavorable prior accident year development for the three months ended March 31, 2023 was primarily driven by higher severity on automobile physical damage.