HARTFORD INSURANCE GROUP INC
For the period ended Dec 31, 2024. Filed Feb 21, 2025.
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FY2024 · Filed Feb 21, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
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Employee Benefits
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| Table of Contents | Index to MD&A |
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|EMPLOYEE BENEFITS - RESULTS OF OPERATIONS
| 2024 | 2023 | 2022 | Increase (Decrease) From 2023 to 2024 | Increase (Decrease) From 2022 to 2023 | |
|---|---|---|---|---|---|
| Premiums and other considerations | $6,615 | $6,515 | $6,057 | 2% | 8% |
| Net investment income [1] | 475 | 469 | 524 | 1% | (10%) |
| Net realized losses [1] | (24) | (45) | (122) | 47% | 63% |
| Total revenues | 7,066 | 6,939 | 6,459 | 2% | 7% |
| Benefits, losses and loss adjustment expenses | 4,681 | 4,683 | 4,517 | —% | 4% |
| Amortization of DAC | 34 | 34 | 33 | —% | 3% |
| Insurance operating costs and other expenses | 1,609 | 1,514 | 1,467 | 6% | 3% |
| Amortization of other intangible assets | 40 | 40 | 40 | —% | —% |
| Total benefits, losses and expenses | 6,364 | 6,271 | 6,057 | 1% | 4% |
| Income before income taxes | 702 | 668 | 402 | 5% | 66% |
| Income tax expense [2] | 141 | 133 | 75 | 6% | 77% |
| Net income | $561 | $535 | $327 | 5% | 64% |
[1]For discussion of consolidated investment results, see MD&A - Investment Results.
[2]For discussion of income taxes, see Note 16 - Income Taxes of Notes to Consolidated Financial Statements.
Premiums and Other Considerations
| 2024 | 2023 | 2022 | Increase (Decrease) From 2023 to 2024 | Increase (Decrease) From 2022 to 2023 | |
|---|---|---|---|---|---|
| Fully insured — ongoing premiums | $6,392 | $6,290 | $5,858 | 2% | 7% |
| Buyout premiums | 1 | 8 | 12 | (88%) | (33%) |
| Fee income | 222 | 217 | 187 | 2% | 16% |
| Total premiums and other considerations | $6,615 | $6,515 | $6,057 | 2% | 8% |
| Fully insured ongoing sales | $718 | $839 | $801 | (14%) | 5% |
Ratios, Excluding Buyouts
| 2024 | 2023 | 2022 | Increase (Decrease) From 2023 to 2024 | Increase (Decrease) From 2022 to 2023 | |
|---|---|---|---|---|---|
| Group disability loss ratio | 68.0% | 67.1% | 68.3% | 0.9 | (1.2) |
| Group life loss ratio | 78.7% | 83.5% | 87.4% | (4.8) | (3.9) |
| Total loss ratio | 70.8% | 71.8% | 74.5% | (1.0) | (2.7) |
| Expense ratio [1] | 25.4% | 24.3% | 25.3% | 1.1 | (1.0) |
[1]Integration and transaction costs related to the acquisition of Aetna's U.S. group life and disability business are not included in the expense ratio.
Margin
| 2024 | 2023 | 2022 | Increase (Decrease) From 2023 to 2024 | Increase (Decrease) From 2022 to 2023 | |
|---|---|---|---|---|---|
| Net income margin | 7.9% | 7.7% | 5.1% | 0.2 | 2.6 |
| Adjustments to reconcile net income margin to core earnings margin: | |||||
| Net realized losses, before tax | 0.4% | 0.4% | 1.8% | 0.0 | (1.4) |
| Integration and other non-recurring M&A costs, before tax | —% | 0.1% | 0.1% | (0.1) | 0.0 |
| Income tax expense | (0.1%) | (0.1%) | (0.5%) | 0.0 | 0.4 |
| Core earnings margin | 8.2% | 8.1% | 6.5% | 0.1 | 1.6 |
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Net income increased primarily due to a lower group life loss ratio, higher fully insured ongoing premiums and lower realized losses, partially offset by a higher expense ratio and a higher loss ratio on group disability and supplemental health products.
Insurance operating costs and other expenses were higher prim arily due to the effect of an increase in fully insured ongoing premium, higher staffing costs, including higher incentive compensation and benefits costs, higher commissions and increased technology investments.
Fully Insured Ongoing Premiums
Fully insured ongoing premiums increased over prior year and included an increase in exposure on existing accounts, new business sales, and persistency in excess of 90%, though slightly below the prior year.
Fully insured ongoing sales decreased compared to prior year driven by lower group life and group disability sales.
Ratios
Loss ratio improved 1.0 points in 2024 compared to the prior year period, driven by a lower group life loss ratio, partially offset by increased loss ratios in disability and supplemental health products. The group life loss ratio decreased 4.8 points driven by a lower level of mortality. The group disability loss ratio increased 0.9 points driven by higher loss ratio on paid family and medical leave products, partially offset by favorable long-term disability claim recoveries and changes in the long-term disability recovery rate assumption of 0.5 points.
Expense ratio increased primarily due to the impact of higher staffing costs, including higher incentive compensation and benefits costs and increased investments in technology.
The Company expects growth in fully insured ongoing premiums in 2025 due to sales and continued strong book persistency. The level of long-term disability incidence and recoveries will impact the group disability loss ratio. Although the group life loss ratio, which had been elevated during the pandemic, improved in 2024, we expect 2025 mortality to still be above pre-pandemic levels. We expect the long-term net income margin outlook for this business to be approximately 6% to 7%.
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.