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    HIG
    Earnings call· Jun 2026(Q2 FY26)

    HARTFORD INSURANCE GROUP, INC. HIG

    Jul 24, 2026 Source

    Executive summary

    The Hartford Q2 FY26 — Strong Performance Across P&C and Employee Benefits, Capital Return Increased

    The Hartford delivered strong Q2 FY26 results, driven by robust performance in Business Insurance and Employee Benefits, and a significant new share repurchase authorization following the Hartford Funds sale. While Personal Insurance faced competitive headwinds impacting growth, the company remains focused on disciplined underwriting, strategic investments in technology, and capital management to enhance shareholder value.

    Highlights

    5

    • Core earnings reached $945 million, contributing to an outstanding trailing 12-month core earnings ROE of 18.7%.

    • A new share repurchase authorization of $4.2 billion was approved, reflecting strong capital generation and proceeds from the Hartford Funds sale.

    • Business Insurance delivered strong written premium growth of 5% with an underlying combined ratio of 89.3%.

    • Employee Benefits achieved strong premium growth and a core earnings margin of 7.4%.

    • Net investment income increased by $142 million or 22% year-over-year to $800 million.

    Concerns

    5

    • Personal Insurance written premium declined 7%, with auto down 10%, due to a competitive market.

    • Prior year adverse development included $46 million in general liability and $26 million in commercial auto liability for the quarter.

    • The Global Specialty underlying combined ratio increased due to a higher international loss ratio and technology costs.

    • The group disability loss ratio increased by 6.3 points to 74.8% due to increased claim incidents.

    • Middle & Large Business underlying combined ratio of 95.3% included normal quarter-to-quarter volatility in non-CAT property losses and a shift in business mix.

    Guidance & targets

    6
    CategoryTargetConfidence
    Quarterly Share Repurchases
    $475 million
    high materiality
    High
    Net Investment Income
    increase
    medium materiality
    Medium
    Overall Portfolio Yields
    broadly in line with 2025
    medium materiality
    Medium
    Limited Partnership Returns
    generally consistent with the average annualized return achieved in the first half of the year
    low materiality
    Medium
    Middle & Large Business Underlying Combined Ratio
    roughly a point better than 93.3%
    medium materiality
    Medium
    Personal Insurance Agency Product Rollout
    in 30 states
    medium materiality
    High

    Segment performance

    9
    SegmentRevenueYoYQoQMargin
    Business Insurance
    Delivered strong written premium growth and underlying combined ratio, reflecting excellent execution and disciplined underwriting across the portfolio. Expense ratio was generally consistent with prior year and in line with expectations.
    Underlying combined ratio: 89.3%Expense ratio: 30.7%
    		—5%—89.3%
    Small Business (Business Insurance)
    Delivered excellent results with growth driven by double-digit increases in package and E&S binding. Underlying combined ratio improved due to lower non-CAT property losses and improved operating leverage. Technology investments drive speed and ease of quoting.
    Underlying combined ratio: 86.5%Underlying combined ratio improvement YoY: 2.5 points
    		—7%—86.5%
    Middle & Large (Business Insurance)
    Solid quarter with growth. Underlying results included normal quarter-to-quarter volatility in non-CAT property losses (few large fire losses) and a shift in business mix towards national accounts and commercial auto. Underwriters leverage AI-enabled capabilities.
    Underlying combined ratio: 95.3%YTD underlying combined ratio: 93.3%
    		—4%—95.3%
    Global Specialty (Business Insurance)
    Strong quarter with continued momentum across several lines, led by wholesale excess casualty and auto, bond and financial lines. Underlying combined ratio increased from prior year due to higher international loss ratio and technology costs.
    Underlying combined ratio: 85.8%Underlying margins: mid-80s
    		—4%—85.8%
    Personal Insurance
    Underlying combined ratio improved, but written premium declined due to elevated competition for new business. Expense ratio increased due to lower earned premiums and higher commissions from increasing mix of agency business.
    Underlying combined ratio: 86.3%Underlying combined ratio improvement YoY: 1.7 pointsExpense ratio: 26.3% (up from 25.1% in Q2 2025)
    		—-7%—86.3%
    Auto (Personal Insurance)
    Underlying combined ratio improved as earned pricing continues to exceed loss trend.
    Underlying combined ratio improvement YoY: 1.9 pointsRenewal written pricing: 5.5%Effective policy count retention: improved slightly
    		—-10%——
    Home (Personal Insurance)
    Results remained strong, supported by consistent underwriting execution and low double-digit pricing.
    Renewal written pricing: 10.4%Effective policy count retention: relatively stable
    		—Flat——
    Agency (Personal Insurance)
    Growth remained strong. Contemporary product offering now available in 23 states and progressing as planned.
    		—7%——
    Employee Benefits
    Core earnings margin reflects excellent group life and solid disability performance. Strong fully insured premium growth, persistency in the low 90s, and technology investments. Disability results partially driven by increased claim incidents.
    Core earnings margin: 7.4%Group life loss ratio: 74.2% (relatively flat YoY)Group disability loss ratio: 74.8% (increased 6.3 points)Expense ratio: 25.2% (improved 0.5 points compared with Q2 2025)
    		———7.4%

    Operational metrics

    17
    Core earnings
    $945 million
    Q2 FY26

    Contributed to an outstanding core earnings ROE.

    Core earnings ROE
    18.7%
    TTM

    Trailing 12-month core earnings ROE.

    Book value per share excluding AOCI
    $78.91Up 7% from year-end; Up 15% from a year ago
    Q2 FY26

    Reflecting earnings power and disciplined capital management.

    Net investment income
    $800 millionUp $142 million or 22% from Q2 2025
    Q2 FY26

    Driven by higher income from limited partnerships and other alternative investments and a higher level of invested assets.

    Annualized portfolio yield excluding limited partnerships
    4.7%Up 20 basis points from Q1
    Q2 FY26

    Reflects strategic management of the portfolio.

    Annualized limited partnership returns
    7.6%Up from 5.1% in Q1
    Q2 FY26

    Benefited from multiple real estate joint venture sales and strong performance from infrastructure and energy transition funds.

    P&C current accident year catastrophe losses
    $222 millionUp from $212 million in prior year
    Q2 FY26

    Catastrophe ratio remained unchanged at 4.9 combined ratio points.

    Prior year reserve development (General Liability)
    $46 millionadverse
    Q2 FY26

    Primarily to reflect a higher frequency of large losses in excess casualty and umbrella lines.

    Prior year reserve development (Commercial Auto Liability)
    $26 millionadverse
    Q2 FY26

    Driven by higher severity than previously estimated, reflecting increasing attorney representation and time limit demand.

    Prior year reserve development (Workers' Compensation)
    $110 millionfavorable
    H1 FY26

    Underlying book continues to perform well.

    Share repurchases executed
    $450 million
    Q2 FY26

    Part of the ongoing capital return strategy.

    Remaining share repurchase authorization
    $650 million
    Q2 FY26

    In addition to the newly approved authorization.

    New share repurchase authorization
    $4.2 billion
    Through December 2028

    Reflects strong capital generation and expected cash proceeds from The Hartford Funds sale.

    PFML utilization
    up
    Q2 FY26

    Seen in early periods when new states go live and in states that have been in force for a number of years.

    Large property book size
    $200 million
    FY

    Relatively small exposure to the large property market.

    E&S book size (small commercial)
    $300 million
    FY

    Relatively small exposure.

    Shared and layered book (large property)
    less than $25 million
    Q2 FY26

    Shrunk due to market conditions and not meeting benchmarks.

    Industry KPIs

    11
    MetricValueDetails
    Combined ratio89.3%%
    Capital returns$4.2 billionUSD
    ROE operating ROE18.7%%
    Catastrophe losses$222 millionUSD
    Book value per share$78.91USD
    Net investment income$800 millionUSD
    Retention persistencylow 90s%
    Life specific when present74.2%%
    Net premiums written earned5%%
    Renewal rate change pricing5.8%%
    Prior year reserve developmentFavorable

    Product announcements

    1
    ProductTypeDetails
    Contemporary Product Offeringexpansion

    Deals & partnerships

    1
    Wellington ManagementAgreement to sell Hartford Funds, a noncore long-term investment.

    The Hartford announced an agreement to sell Hartford Funds to Wellington Management. The transaction is structured uniquely to allow The Hartford to participate in the upside as the two combined organizations come together and create additional value in the marketplace.

    Risks & headwinds

    6
    Competitive Market in Personal InsuranceQ2 FY26, expected to continue into 2027 for direct channel.

    Personal Insurance written premium declined 7%, with auto down 10%.

    Mitigation: Rollout of contemporary product offering in agency channel (23 states, targeting 30 by early 2027); focus on customer acquisition and retention in direct channel; investments in competitive pricing, seamless customer experiences, and products for the mature market.

    Elevated Large Loss Activity in General LiabilityQ2 FY26, across multiple accident years (2017, '18, '19, '22, '23).

    $46 million adverse prior year development in GL for the quarter.

    Mitigation: Modest adjustments made to reserves; continued disciplined underwriting and claims review.

    Higher Severity in Commercial Auto LiabilityQ2 FY26, within accident years 2023 and 2024.

    $26 million adverse prior year development in commercial auto liability for the quarter.

    Mitigation: Increased attorney representation and time limit demand incorporated into reserve estimates; disciplined underwriting and claims review.

    Increased Claim Incidents in DisabilityQ2 FY26.

    Group disability loss ratio increased by 6.3 points to 74.8%.

    Mitigation: Still within long-term margin expectations (6-7%); continued pricing adjustments for PFML; monitoring claims across diagnoses.

    Moderating Property PricingQ2 FY26.

    Property pricing moderated, particularly in large property.

    Mitigation: Still highly profitable and attractive area for growth; aggregate pricing for small business package and middle-market general industries remained fairly steady in mid-single digits.

    Increasing Competition in Middle & Large CommercialQ2 FY26, expected to continue in H2 FY26.

    Retention slipped 3 points.

    Mitigation: Making choices not to grow if competitive dynamic goes too far; focus on attractive risk-adjusted returns.

    What to watch in Q3 FY26

    5

    Middle & Large Business Underlying Combined Ratio

    H2 FY26
    Current93.3% (YTD)
    Targetroughly a point better than 93.3% for full year

    Why it matters

    This indicates whether non-CAT property losses normalize and if underwriting discipline can improve profitability in this segment.

    We expect the full year to probably come in roughly a point better than that [93.3% YTD].

    Q&A highlights

    6

    Asked for granularity on the $116M adverse GL and $26M adverse commercial auto development, and whether it's a one-time event or chronic.

    Beth clarified that for the quarter, GL adverse development was $46 million across multiple accident years due to elevated large loss activity, and commercial auto was $26 million due to higher severity in recent years (2023/2024) from increased attorney involvement. She stated these were modest adjustments and did not fundamentally change their overall view on reserve adequacy.

    “So if I start with general liability, again, there, we increased prior year reserves by $46 million. And again, as it says in the commentary, that was across multiple accident years. We saw some elevated large loss activity. And these are lines that we want to be very cautious about. So we reacted to that.”

    asked by Andrew Kligerman · answered by Beth Bombara

    3 min read6 chapters

    Detailed Narrative

    01

    Hartford Funds Divestiture and Capital Allocation

    The Hartford announced an agreement to sell Hartford Funds to Wellington Management, strategically monetizing a noncore long-term investment. This transaction, structured to allow participation in future upside, contributed to a new $4.2 billion share repurchase authorization through December 2028. This authorization reflects strong capital generation from the businesses and expected cash proceeds from the sale, with an incremental 15% from the funds transaction and 12% from business growth compared to the prior authorization.

    02

    Business Insurance Performance and Underwriting Discipline

    Business Insurance delivered a strong quarter with 5% written premium growth and an 89.3% underlying combined ratio. Small Business excelled with 7% premium growth and an 86.5% underlying combined ratio, driven by automation and digital service. Middle & Large achieved 4% premium growth but had a 95.3% underlying combined ratio, impacted by non-CAT property losses and a mix shift towards national accounts. Global Specialty maintained strong mid-80s underlying margins with 4% premium growth, led by wholesale excess casualty and auto, bond, and financial lines.

    03

    Personal Insurance Challenges and Strategic Investments

    Personal Insurance's underlying combined ratio improved 1.7 points to 86.3%, driven by auto and home. However, written premium declined 7%, with auto down 10%, due to intense competition in the marketplace. The company is actively rolling out its contemporary product offering, now available in 23 states, with a target of 30 states by early 2027 in the agency channel. Efforts are also focused on strengthening customer acquisition and retention in the direct channel, particularly with the AARP relationship.

    04

    Employee Benefits Strength and Market Positioning

    Employee Benefits reported a core earnings margin of 7.4%, reflecting excellent group life and solid disability results. The segment achieved strong fully insured premium growth, benefiting from strong sales execution, persistency in the low 90s, and continued technology investments. The integrated benefits platform and leadership in absence and leave management differentiate The Hartford in the market, positioning it for continued attractive growth and margins, despite an increase in the disability loss ratio due to higher claim incidents.

    05

    Investment Portfolio Performance and Outlook

    The diversified investment portfolio delivered strong results, with net investment income of $800 million, up 22% year-over-year. This was driven by higher income from limited partnerships and other alternative investments, and an increased level of invested assets. Annualized limited partnership returns were 7.6% before tax, up from 5.1% in the prior quarter, benefiting from real estate joint venture sales and strong performance from infrastructure and energy transition funds. The company expects net investment income to increase for the full year 2026, with portfolio yields broadly in line with 2025.

    06

    Reserve Development and Catastrophe Losses

    The quarter saw favorable prior year development driven by reserve reductions in workers' compensation, catastrophes, bond, and personal insurance. This was partially offset by adverse development of $46 million in general liability (reflecting elevated large loss activity across multiple accident years) and $26 million in commercial auto liability (due to higher severity in accident years 2023 and 2024 from increased attorney representation). P&C current accident year catastrophe losses were $222 million before tax, up from $212 million in the prior year, with the catastrophe ratio remaining at 4.9 combined ratio points.

    AI-generated summary of the company’s earnings call. Not investment advice.