The Hartford Earnings Fall in Q3
The Hartford reported core earnings of $364 million for the three months ended Sept. 30, a 24 percent or $113 million decrease from core earnings of $477 million in third quarter 2014. The insurer said the decrease was principally due to lower net investment income, unfavorable prior year loss reserve development and higher catastrophe losses.
The Hartford’s Chairman and CEO Christopher Swift said the results this quarter “reflect headwinds in several areas, resulting in a decrease in core earnings.”
Third quarter 2015 net income decreased 2 percent from third quarter 2014.
Net investment income decreased 10 percent largely due to lower limited partnership and other alternative investments income
Other notes from The Hartford’s third quarter results:
Commercial Lines
- The commercial lines third quarter 2015 combined ratio was 91.0, which is a 1.0 point better than third quarter 2014, reflecting improvement in small commercial and specialty commercial, and a slight deterioration in middle market.
- Standard commercial renewal written pricing increases averaged 2 percent.
- Third quarter 2015 written premiums in commercial lines grew 4 percent over third quarter 2014, reflecting renewal written price increases and strong retention in small commercial and middle market, which together comprise about 86 percent of The Hartford’s commercial lines written premiums.
Personal Lines
- The overall personal lines combined ratio was 95.6, an increase of 4.7 points over third quarter 2014. The deterioration was due to higher automobile liability and physical damage frequency, elevated non-weather related homeowners claims and higher marketing expenses.
- The automobile combined ratio rose from 97.0 in third quarter 2014 to 101.6 in third quarter 2015. The company said an increase in automobile frequency, which emerged during third quarter 2015, is likely correlated to stronger economic trends, including higher miles driven.
- The homeowners combined increased from 77.6 in third quarter 2014 to 82.4 in third quarter 2015, primarily due to fire and water-related claims that were partially offset by lower weather-related claims.
- Third quarter 2015 personal lines written premiums rose 1 percent over third quarter 2014, reflecting relatively stable premium retention and automobile new business growth in AARP Direct and AARP Agency.
- Total automobile new business premium increased 3 percent, while homeowners declined 15 percent compared with third quarter 2014.
- Renewal written price increases in third quarter 2015 averaged 6 percent in automobile and 8 percent in homeowners, consistent with the past several quarters.