The Hartford Insurance Group (NYSE:HIG) used its fourth-quarter 2025 earnings call to highlight what management described as an “outstanding” year of performance, supported by profitable growth across its underwriting businesses, higher investment income, and continued capital returns to shareholders.
Full-year performance and strategic priorities
Chief Executive Officer Chris Swift said 2025 results reflected the effectiveness of the company’s strategy and investments in innovation. He cited business insurance written premium growth of 8% with “excellent underlying margins,” a “pivotal year” in personal insurance as auto returned to targeted profitability and homeowners produced strong results, and an employee benefits core earnings margin of 8.2% for the year, led by life and disability.
Quarterly core earnings and segment results
Chief Financial Officer Beth Costello reported fourth-quarter core earnings of $1.1 billion, or $4.06 per diluted share. For the year, she reported a core earnings return on equity of 19.4%.
- Business insurance: Fourth-quarter core earnings were $915 million. Written premium grew 7% and the underlying combined ratio was 88.1. Costello said the business insurance expense ratio rose to 31.8, up 1 point from the prior-year quarter, as earned premium leverage was more than offset by higher technology costs and increased incentive compensation tied to overall performance.
- Personal insurance: Core earnings were $214 million, with an underlying combined ratio of 84.3. The underlying combined ratio improved 5.9 points year over year, driven primarily by improvement in the underlying loss and loss adjustment expense ratio in auto and homeowners. Written premium declined 2% for the quarter, though agency premium grew 15% over the prior year. The expense ratio improved to 26.2 from 26.5, as earned premium leverage offset higher technology costs and incentive compensation.
- Employee benefits: Core earnings were $138 million and the core earnings margin was 7.6%, which Costello said reflected excellent group life and strong disability performance. The group life loss ratio improved to 76.9, while the group disability loss ratio increased to 70.5, driven by higher short- and long-term disability loss trends, partially offset by improvement in paid family and medical leave products.
Pricing, underwriting discipline, and business insurance trends
Management emphasized disciplined underwriting and maintaining margins as market conditions evolve. Swift said business insurance renewal written pricing excluding workers’ compensation was 6.1% for the quarter. He said property pricing continued to moderate but remained “highly profitable” and attractive for growth, while casualty remained firm and “above loss trend,” supported by proactive segmentation and limits management. Excess and umbrella pricing moved further into double digits, commercial auto stayed in the low double digits, and general liability primary lines were in the high single digits, according to Swift.
Costello provided additional color by unit. In small business, written premium grew 9% and the underlying combined ratio was 87.3. Renewal written pricing was 4.3% all-in, or 7.7% excluding workers’ comp; she said this was down from the third quarter “primarily due to pricing within the property components of the package product and E&S.” Middle and large business posted 5% written premium growth and an underlying combined ratio of 89.4, with 4.5% all-in renewal written pricing (6.2% excluding workers’ comp). Global Specialty grew written premium 5% and reported an underlying combined ratio of 87.6, with renewal written pricing of 3.9%.
In Q&A, executives said they expect property pricing in the package product to “flatten out” and stabilize as the company moves into 2026, while watching E&S closely. They also said they are focused on “steady bites at the apple” in small business to avoid rate shocks for customers and noted agents value predictable carriers because they “can’t afford to touch the small business very much.”
On E&S binding, Swift said fourth-quarter year-over-year growth was about 30% and full-year growth was closer to 35%, adding that it could become a “$300+ million premium business” in 2026. Management acknowledged pricing is softening but said profitability remains strong given the “starting point” of current margins.
On casualty, Swift said the company views elevated trend as a key focus area and does not see trends retreating, emphasizing the need for discipline in primary, umbrella, excess, and commercial auto. Another executive added the company believes market discipline has been relatively stable and does not expect that to change in 2026.
Reserves, catastrophes, investments, and capital deployment
Costello reported total P&C net favorable prior accident year development (excluding A&E) of $177 million before tax, driven by reserve reductions in workers’ compensation, bond, catastrophes, and personal auto. The company’s A&E reserve study resulted in a reserve increase of $165 million, including $122 million for asbestos and $43 million for environmental. She attributed the asbestos increase to higher-than-expected frequency, higher settlement rates, and higher settlement values for a subset of accounts, and the environmental increase to higher cleanup and monitoring costs and legal expenses.
Catastrophes were a benefit of $1 million in the quarter, including $54 million of favorable prior-quarter development tied primarily to tornado, wind, and hail events. For the full year, catastrophes came in under budget at 4.2 points. Costello said the company renewed its per-occurrence catastrophe cover at Jan. 1, 2026 with favorable terms and renewed its aggregate treaty at $200 million excess of $750 million at a lower cost on a risk-adjusted basis. She also said the company issued a new catastrophe bond through Foundation Re, increasing total per-occurrence protection for peak perils to $1.9 billion.
In investments, net investment income rose to $832 million in the quarter, up $118 million, or 17%, from the prior-year quarter. Costello said the increase was driven by higher limited partnership yields, higher invested assets, and reinvestment at higher interest rates, partially offset by lower yield on variable rate securities. She said the company expects net investment income to increase in 2026, supported by asset growth and improved limited partnership returns.
On capital management, Costello reported holding company resources of $1.5 billion as of Dec. 31. The company expects net dividends from operating companies of approximately $2.9 billion in 2026, a 16% increase over 2025. The Hartford repurchased about 3 million shares for $400 million during the quarter and expects to increase quarterly share repurchases to $450 million beginning in the first quarter, subject to market conditions and remaining authorization. Costello said $1.55 billion remained under the authorization through Dec. 31, 2026.
Personal insurance growth initiatives and Prevail rollout
Management said personal lines is shifting from restoration to growth, with expectations that auto rate increases will moderate. Swift said the company expects 2026 auto pricing increases to “harmonize” into the 6% to 7% range after a quarter with roughly 10% to 11% auto pricing increases, which he said should help retention and new business growth. Executives said agency is the primary growth opportunity, while direct channel policy count growth remains challenged due to competitiveness.
Swift also discussed expansion of the Prevail platform. He said Prevail is the platform for all new business going forward in both direct and agency channels, while the back book will “run off over time” rather than being converted to avoid disruption. Management said Prevail Agency is live in 10 states, with around 30 launches planned by early 2027, and called the agency channel a meaningful growth opportunity. An executive noted agency premium represents about 20% of total premium and said it would take time to grow to the size of the AARP book.
Management briefly addressed Winter Storm Fern, calling it “a very manageable event” so far based on early claim activity, and said impacts are driven more by ice and power outages than snowfall.
About The Hartford Insurance Group (NYSE:HIG)
The Hartford Financial Services Group, commonly known as The Hartford, is a U.S.-based insurance and investment company that provides a broad range of commercial and personal insurance products and employee benefits. Its core businesses include property and casualty insurance for businesses and individuals, group benefits such as group life, disability and dental plans, and retirement and investment solutions offered through affiliated asset-management operations. The company also delivers risk management, claims-handling and loss-prevention services designed to support policyholders across a variety of industries.
Founded in Hartford, Connecticut, in 1810, The Hartford is one of the oldest insurance organizations in the United States and has a long history of underwriting and product development across multiple insurance lines.
