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Hartford Financial Services (HIG)

Participants
Susan Spivak SVP, IR
Chris Swift Chairman and CEO
Beth Costello CFO
Doug Elliot President
Greg Peters Raymond James
David Motemaden Evercore ISI
Gary Ransom Dowling & Partners
Elyse Greenspan Wells Fargo
Brian Meredith UBS
Call transcript
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Operator

Hello, and welcome to the Second Quarter 2021 Hartford Financial Results Webinar. My name is Harry, and I'll be coordinating your call today. [Operator Instructions] I'll now hand over to your host, Ms. Susan Spivak, Senior Vice President, Investor Relations to begin. Ms. ahead. go please Spivak, Susan

Susan Spivak

all Thank you, today quarter for us and and earnings. our materials website. Good our call morning, posted results for reported second night, thanks the and earnings-related Last on joining we Harry. of webcast XXXX on

today are President. the The Chairman of Chris and Elliot, call For Beth and Costello, Doug Swift, CEO Hartford; Chief our speakers Financial Officer

remarks, we will period. prepared Q&A their Following a have

uncertainties the performance, statements Private before comments Chris Today’s as final from risks assume of and defined provided forward-looking These detailed materially this forward-looking guarantees our obligation under to results those should any or these description Litigation update few are a actual of be can call. Just on SEC not be XXXX. Securities information results call begins. to could We Act and Reform not filings. statements. that includes cause risks A differ also in do could different. found statements of statements and actual uncertainties Investors consider future the

financial include comparable non-GAAP the reconciliations these the and of financial well our release Explanations filings measures. to as news and today included as measure measures SEC are GAAP commentary in supplement. Our

year. conference note be available rebroadcast on may that please Hartford’s now an transcript will of Replays it and I'll official one this turn Chris. no any of portion the reproduced consent. Finally, website or form written be call over in prior The without this to for webcast Hartford's

Chris Swift

Hartford. this excited the that had more I for about joining shared us The of never Thank Last morning. I quarter, you future been

X% growth, XX.X%. the expansion coming in share, the we and year-over-year book of $XXX per excluding components core second together ROE earnings or AOCI diluted and optimism. operating diluted Our second to core our of All earnings share, In per quarter strategy $X.XX results trailing quarter, million of growth a reported value efficiencies. XX-month that are margin deliver support

strong in shareholders loss assumptions strategy elevated repurchases focus this leadership $XXX recent premium base The second our of the forward. employment-centric through expected, high we elevated considering time, will million inflation monitoring our as the ratio performance common In dividends. return and inflation businesses financial new we the the benefit while gauge Meanwhile, closely formations. GDP, and remain businesses At that to outstanding against Economic on backdrop where and and reflects are in share our quarter as addition, competitive quarter. sufficient returned other execution Hartford moderation in advantages. success from The to the This reached have data economic as XXXX. same overall job from by record are grow And pricing expansion a they we creation trend level will is growth, measured going the XXXX. and lines and sustainable market business trends confident remain are actions we we of of

investment Finally, macroeconomic well evolving and the for positioned our is diversified portfolio environment.

been we inflation, that of better Hartford franchise returns and positioned developments for am enhance I enter second our XXXX, watching never the continue very stakeholders. while industry-leading confident and has with As generate The to all to half value COVID-XX

growth, comments Lines investment with In results COVID and Commercial Let top reduced from Property underlying by impact. Casualty, business. results, driven expansion contribution were the strong now the some about make margin very higher me and within high-level improved double-digit a line income

exceptional. continue we to in profitable been be margins. commercial For a generated Results nearly the and have years, small consistently have XX market highly leader

more capabilities differentiated a and premium profitable share. as Our experience, levels, contribute written which customer products are to superior capture driving digital higher we market

demonstrated while sales In by growing team new has job our reached line and next-gen tremendous done quarter, consecutive Middle & our Spectrum, margins premium second as levels. a Commercial, the new sales Large improving levels. record the written For top

As for specialized Cross-selling the very targeted our services. attractive distribution a products retail verticals our well are In lines and successful, The over and next positioned go-to-market distribution risk-adjusted invests as feedback in in are that country risk been growing product new has the Global decade, infrastructure Specialty, from teamwork. been the within returns. and partners regarding Hartford's exceptional provide very we breadth has

As team strategic time further, timing of was what of our a ideal, I has Navigators to transaction short expect in closed. environment. extremely the pricing discuss market accomplished robust the am of targets Doug segment in will in pleased the this exceed since we plan. the ahead with cross-sell a The given growth year period

thoughtfully ago, self-evident. ratios And are And to generating this two improve we improvement to plan years more business developed combined the was is there the believe results We Just a performance. above XXX%. come. financial

Commercial the $X.X improved the Specialty. about this We have potential effectiveness annual of premium billion optimistic future, in we underwriting realize full the I And Lines, nearly investments technology the as our speed Across very of Global have process. the products and of am business. and capabilities of

continue customers. We of in Commercial further to underwriting marketplace. and are well businesses and Lines our Overall, and needs to more our make respond the decisions, partners compete to distribution positioned informed data leverage to win, the analytics and our

one direct AARP, Turning partnership in groups our the auto the of to with affinity we personal writer Personal largest Lines, of are largest America. fifth through

technologies reliant our live they become capabilities. provides already on and that auto fast demographic greater population. transformation are both, digital we enhancing market in to further Over three modernizing our the ability This work. is on the way in as growing and strong grow the capitalize to the mature grow To times as segment, has home this of products the and decade, demographic rest in this next digital more U.S. estimated XX-plus

like included Boy filed Before released turning this plan, its The to I from with an settlement briefly of Scouts Benefits, would be on month, the Group request to the amended Earlier to which comment a Hartford. the agreement Boy bankruptcy Scouts.

litigation, with with the court. bankruptcy I on this not said, further strong contesting and matter. am comment consistent filed going to active opposition are policy vigorously this had We regarding request, That and our

continued to been results disability buyouts, five favorable as posted well the as expanding for Benefits. elevated Turning in offset mortality. excess by well reflect excluding payrolls, Group by new Group excellent The year-over-year life industry as trends, strong over driven premiums, has We past by Higher sales as investment solid earned quarter impacted quarters. persistency. excess returns, the mortality

to versus rapidly across second have losses mortality for amounts, but severity has the quarter, During to carry elevated the climate in our industry. in U.S. our book COVID-XX our earlier drive January, Consistent since business with the excess increased have significantly average dropped deaths Life mortality first and the U.S. has pandemic. Since cohorts higher younger the continues in declined COVID-XX periods claim relative quarter. face the age of age average decreased. tend trends, to peaking

optimistic are vaccines. of about We efficacy the

However, strains this variant in expect half excess XXXX year. closely slowing we That age we do of said, in cohorts. the younger to rate mortality the are half particularly the of lower monitoring vaccinations, compared among second of first the

top in share, diverse with small Benefits across We strong accounts. product from to industry are a portfolio Group a market the business national carrier three capabilities customer and segments

in ahead. point people relationship the experience. desired see important extend and employees many overall including platform growing stronger our employers access for to The improve invest customer to to access offerings, continue products. that to protection years obtain the service for in our remains And We technology workplace digital an we

and we pandemic the the created on addition, new In services provide. products focus

confident positions to competitive group are To grow We executing confidence our conclude, maintain innovative advantages, our that in are mindset well precision. with benefits. and we as and

underwriting renewal a strong is expected partnerships. macroeconomic positive rate with environment broad Margins capabilities, and Our expanding tailwinds. with offerings benefiting mortality losses enhanced strong are decline are product top-line and excess from distribution to

are of and capital stakeholders. of target XX% and and all a grow Last loss quarter into with to share. earnings driven top-line margin ROE earned we management. across and operating optimistic will We market positioned objectives I profitable deliver pricing the financial to XX% capture in to costs, in shared trends core value on XXXX, by and efficiencies improvement our we our businesses, growth confident enhance proactive prudent of more XXXX for strong and am continue excess

I'll over to Beth. Now, it turn

Beth Costello

Chris. shareholders. creation very Overall, for with our the our progress quarter on pleased you, Thank for results priorities and value enhance we are the to

and all ex-COVID Commercial were also all In in and million of to Global we quarter had XXX Second investment accounts. $XXX the higher quarter subrogation second losses, reduction from provision growth accident unrest. $X loss the reserves performance lower than as the personal catastrophe Results last as lower in of in quarter underlying the Written second U.S. XX% development as In Results Hartford and our bonds. second loss quarter reflecting million, million for to quarter Across both was the combined million well lines premiums an direct across an XXXX, additional ratio COVID This net by an up a XXXX, year ratio related XXXX, effect from reserve in ratio Personal from business, of to due reserve a pandemic. across gain cover and ratios. Commercial benefit from businesses, due XX% lower earned strong favorable lower all of lower as earnings from $XXX decreases $XXX generated businesses. as $XXX compensation, which and including million catastrophes prior Lines auto Navigators of points million the prior core losses favorable XX.X ratio Casualty, & XX.X, improved development including adverse development in in or compared compared diluted civil from improved quarter in up an of X.X included primarily with was $XX lines. growth Property of Middle year-over-year in XXXX. quarter and audit points We unfavorable in P&C, Next auto endorsement improved doubtful combined million excellent core to X.X workers' of quarter reserve $XX to rebound. net million PG&E. which million P&C financial reserves, package catastrophe were development $XXX improvement to combined decrease XXXX, ratio XXXX, savings excellent In year. significantly we Commercial ceded down $XX Large for or Lines including $XXX improvements last share of a $XXX to million expense frequency included as liability, underwriting The premium economic premium well and second $XXX ratio compared improvement the in quarter expense produced cost business underlying Specialty included in Lines, and XX%, per second in million the points $X.XX COVID results basis earnings and expense period. within the reflecting including to and significantly which the million benefited second year of were year an XX.X%. the

and experienced the All deferred strong quarter. are deaths quarter, losses excess XX% million, quarter which net ceded, results million prior persistency against charge of our a resulted in over quarter. reserve core million, was Benefits in continuation second include these Group earnings million economically we a were gain, up year. the the Although, $XXX Through cause XXX prior related $XXX quarter the income offset at representing million. development the development related the first results, XX.X%. mortality the in an mortality quarter our the includes for effect premium paid, to for period six reflect nearly emerge of mortality Earnings insured by first excess of pandemic. COVID-XX of estimates, $XX ongoing $XX to were $XX a for favorable excess as excess and lessening in Sales customers months from strong the of investment mortality fully predominantly year, the in million increase

we vaccination As including excess of of the we continue to rates, the variety trend to second were Chris quarter mentioned, watch from although impact and encouraged declining of variants. by a first quarter, mortality factors

quarter due from was remained to While favorable The of the year prior ratio was for strong short-term of Fund At year were in very remain to core the disability $X.X at the the On incidence increasing deferral XXXX XXXX the Talcott gain though from uncertainty received expect the the Funds, benefited $X excess quarter the up compared $XX loss of slightly million in net improve claim in XXXX, million million Talcott, quarter. quarter. million of to $XX for in as for loss investment in second X.X the prior due and period, Disability June tax half to of procedures strong. the would in for points million interest year year, XX.X% quarter we favorable to the our year of resulting up reflecting compared second quarter prior claim for capital favorable, of higher billion XX, terms average recoveries, quarter quarter prior of disability Long-term we prior significantly. sale impact mortality the remains, a the trends the The million the from XXXX at beginning claim elective daily income frequency loss prior the was down in quarter. from inflows with the second of Hartford core $XX $XX $XXX before our $XX XX%. from medical of AUM although year, net flows earnings Mutual before million tax. at were Corporate pandemic. in loss a realized disability ownership

business, fees includes related third-party management of of expense and management primarily category Corporate the debt the investment invested Talcott. earnings, core within reminder, and managing interest expenses on including to a assets As

Net lower income $XXX quarter, the X.X% Net scenarios. on at from partnership XX investments partnerships, excluding quarter no up year was partial gains XX, to annualized Turning up a of maturities million gain compared a fixed maturities XX, fixed was the and due funds. of ratio Next remains quality of sales from six-month lower and tax private June March higher allowance The within portfolio for efficiencies million valuation program million a The tax June XXXX. from total period for second in XX% million savings pre-tax the yield, to limited return tighter quarter billion $XX before to economic the driven the were investment in in XXXX. the $XXX underlying margin losses to credit $X.X expansion. investments. mortgage portfolio the by improved have unrealized rates valuations on credit very equity expense to limited before with the loans on in of prior interest strong at been Hartford ended $X.X operating benefiting quarter, annualized XXXX, strong Improving X.X% losses delivered from from six-month reduction spreads. credit in and compared due expense The and credit XX%, contributor to

XXXX savings X% continue of was AOCI, million in to per to and since June pre-tax We expect full million XX-month approximately core $XX.XX, $XXX XXXX value diluted $XXX XXXX. our in rose year Book XX.X%. and excluding ROE share, XX, trailing earnings

shareholders, quarter, During repurchases including dividends The Hartford and of returned million in $XXX million $XXX share to the $XXX common million paid.

at with in From For of million the six-month period, share $XXX we repurchased returned $XXX July and in dividends remains million. paid. for XXXX. our under of of $XXX the million shares million to July through $XXX as June $X.X holding we XXth investments. X.X billion and There a common million billion Xst repurchases included $X.X $X.X XX, billion available Resources cash authorization total company

of way Doug. on in million we second achieving we the us very the expect million now half we strong goals the second All $XXX XXXX. dividends April. for and to which $XXX the well turn puts from million results over will received to all, $XXX had approximately in quarter, you our During shared subsidiaries the financial with over call I to in quarter,

Doug Elliot

the financial Beth, Thanks, combined the were of results accelerated prouder our good expectations new Pricing lunch in underlying ratio on personal early and meeting most loss all I strong and lines outstanding we're lines Property our ahead our Six product an into and remains encoring. or produced commercial. key product morning, everyone. of the metrics. couldn't for Casualty trends Premium growth of XX.X. from nearly months Property of quarter, and second performance. Casualty, exceeding year, Within be and In

wages quarter's in a me lines line contributing before commercial performance. year-over-year in line payroll written as few stealer top commercial As $XX.X a anticipated increases are and improvement economy top and an expense Small and with increased both underwriting ratio the more we results. from on mentioned of with combined minutes improving let the XX%, benefiting Beth loss loss to pricing on produced premium ratios, providing color commercial spend trends

exceptional XX% as second business our of a consecutive up had we was million XXX New quarter.

contemporary products record top this achieved to or new drive XX% spectrum of growth our business Our business offering leading new million prior year. over industry success, XX continuous

In little In the and risk business XX%. Middle scores. XX%, is as in the I'm model key points our we milestones Market quotes efficiency leverage underlying pleased underwriting by increased addition with Middle risk by underwriting years. Like small four & & rising at business XX%. XX% into while the was or the underwriting disciplined Commercial, pricing while just achieved during second strong, in as confidence of strong no Specialty Large to discipline, XX%. produced were yield The using XX%, particularly Policy is Commercial's its new Large measured is second another reflected Global metrics is contributed refined accelerated of superior growth Middle tools. this maintaining quarter. profitability. quarter, Market of efficiency proprietary highest bindable $XXX achieved result two material premium to payroll maintaining the Commercial two Small of risk in in on up segmentation growth decisions written underwriting level This quarter quality of of million, quarter of our commercial business years increased equally growth retention increasingly ago. important bill premium with and and gives a written wages June, particularly the our Small Commercial driver bind touch a increase sophistication bindable important. the our and growth us producing Middle over of pricing premium

up the also Reinsurance U.S. XX% growth year. was Financial premium XX% of is retention and of our significantly impressive by In equally wholesale Lines. Global excellent was led the breadth written had XX% premium in an of in quarter with and quarter, XX%. growth from growth written business New prior

activities mentioned an strategy. I've As cross-sell important growth previously, our of are component

business effort in Specialty acquisition between navigators segments. was XX% the of million and new middle Global pace eclipse. market cross-sell Since During premium related this by the quarter, is mill these to and or XXX new delivered new business has XX business sold on

with acquired global both Our contributors sell initial strategy execution. are by U.S. record two and X,XXX industry to XXX built new combined have premium since encouraged these cross particularly acquisition, and our million market years We for The close navigators significant growth increased through of to a metal view example in also the has our competitive early. retail Financial that and success accounts We're now After strength. year the goal a the organically than specially. breadth both product acquisition. of specialization we policies development, our lines Lines XX% access business from as more of the

Let's change lines and trend loss see pricing on market. although Specialty pricing, commercial compensation, U.S. workers' metrics. price of of Market was standard to move Global continue points, X.X down Middle compensation X.X, to X.X% excluding and improved compensation, performance. pandemic loss cost then re-pricing to trends key filings. indicator XXXX a the profitability XXXX future workers' the quarter, was pricing on reflect X% the of impact renewal In include in the

in, We the our state-by-state at remained closely and XX% coming price Global at in All strong pricing will quarter. on international U.S. in a Specialty filings renewal be this with basis. pleased these very the monitoring XX%. I'm months written

loss to Turning commercial trends.

expectations. second line current quarter was year in ratio with largely The accident loss

property, was costs a in normal severity Both and watching repair in an in expectations recorded Overall, in range to dialed incurred claim recent have a loss large property international, were Market offshore And in ratios large Within Specialty increase been of losses slightly wage small we intensely quarter. inflation rising energy material related a building within quarter. expected particularly Middle Global are the large offset labor commercial partially few costs. commercial trends. loss. fire and the We Favorable to by frequency were to favorable volatility. and

wage loss benefits. initial wage elevated minor economic loss The the population. we year. Lines ratio. of improvement trends. accident performance. While growth in wage the continued points we earned speaking, loss trends the last a higher year strong property underlying growth into to This the Middle Commercial translates in replacement current net believe of for be loss impact for Market ratio year remain our the property rest is compensation. x full with our driving workers' severity workers' Generally slightly worker X.X may recovery expectation. compensation In ratio Shifting was and year-on-year.ar, confident is premiums better pricing and COVID Combining I'm the XX%, than pleased quarter, the QX

Lines. Let's now turn to Personal

quarter favorable XX.X. second still to points vehicle underlying rose is pre-pandemic book the increasing but trips frequency miles Auto expected, with and our levels. X.X elevating traveled, is ratio As combined to

quarter quarter amongst XXXX survey. $XX from base. Power, may of favorable for they home fire the had shopping higher age modestly rates - declined extended billing the pressure growth were year. losses new in prior offset was by As costs. trend losses shopping higher-than-expected frequency first X% grace our provision labor to severity for higher million period material versus large very expected, and are auto both driven J.D. continue Written elevated claims we the a after third to the the a quarter, which business second Persistency building down and for strong X% when x-CAT and premium approximately According segment adjusting customer initiated Overall, the refund. claim XXXX $XX by XX-plus

new and marketing Illinois. spend counts remain quarter, Personal point auto up However, compared or plan our as growth issued policy and retention online the now encouraged and premium personal met along Arizona in we contemporary additional to capabilities states, yield, year. products Through business in available from with early exceeded by average lines. Lines are the in above the Both June will year-end, launch advanced for second long-term increased We're expectations, policy expectations. Seven and confident all of was be product premium and quarter prior the prevail. home our by drove also results one new

and back Casualty conclude. call to achieved Before turning for me another quarter. the questions Property let Susan and outstanding answers,

driving X% will multi-year expense X% current earning initiatives. the guidance. the pricing accident to book outperformed, to into CAGR is achieve ratio top lower Next ratios, confidence and Our we Strong our ongoing from commercial our continues benefit lines loss Hartford line providing

and the forward seeing map multi-year to updating days. progress continued broader are and thrilled with I'm road in improved XX selection deeper you products, risk We positive and with outstanding look results execution. our of our

Let me back the Susan. now turn call over to

Susan Spivak

we'll now. questions take Operator, Doug. Thanks,

Operator

Susan. you. Thank

question from from Raymond Peters Greg up. Greg, first comes line James. your Our

You’re open now your you to if would like ask question.

Greg Peters

The first question for growth is lines. in outlook commercial the

You provided a But said around Chris, and and comments, the lot expected. of moderation said the is pricing lines. business had detail growth successes of in commercial areas you you retention different you've new I think in your -

So strong what a quarter I trying with guess a comments. was and I'm to reconcile really outlook second those positive

Chris Swift

Yes.

I of to that, think was in the relation GDP. context Greg,

period X%, was is speaking X%, his numbers. moderation Doug But I as it, And macro in, call that X% So then I in running, expect premium comments, and some what, said the GDP do growth probably I'll we're the here. XXXX. is compounded let still to over written also that I'll X% outlook in on here, that to him X% grow comment our very through bullish ability

off that. backing not we're So, from

fact, probably But as what bullish you we're than were here bit today ago. days more Doug, would In XX we we sit add? even a little

DougElliot

behind Greg and relative and TIF I us the XX so for don't boost we trend nice middle auto small. of And small, a the premium a small outsized bit the longer then tests to on extra separate, been pricing from X.X win TIF new quarter XX, positive had benefit is several in I'll in business all of months. the the inside points growth What terrific a want middle is We've couple little success premiums, new that's at boost, you have little still to quarter-to-quarter. we're expectations, do relative to auto growth would look movement on a just term the to add bit but and of probably we I points so minimize X driving segments, had small at when that, strong. so the front, is pricing a extra and pricing the in the seeing of more quarter, but business

remain that We I point so expect we strong, compare in would quarter repeat headed won't that trends had where pricing itself and and about to XXXX I'm solid QX and forward. a second bullish going we're just to out QX. probably

Greg Peters

That your I high The pressure makes in my could results the was you would sense. seeing And the would are that follow-up then just when as business. in increasing through in a quarter, wondering on some I There's get some courts these I everyone's personalized be, comment miles added so pressure, list. the context you of if and inflation is cost of sequential of question might Obviously result the continuous second from there's guess the reopening. frequency. quarter, quarter you see of some deterioration to as erosion markets we move third we factors mentioned. the

Chris Swift

driven, our but I what pre-COVID, pre-pandemic the had yet comments personalized, miles on is can specifically increased little So shared I my levels, here seeing that, not is auto a right. book and I elaborate bit more

go inflation we all appropriate that provisions intensely yes, think year, than as of recording were Relative particularly made But quarter. quarter. I our pressures. second relative provisions in We earlier we into the conscious mid-second the the for slightly are we of we early and that our the of the saw costs. did watching to still period, goods in quarter, those material through homeowners, part the we we're comment labor for into XXXX are also applicable spikes to of and we're some So of conscious made look we've in of repair of better sold, second that we costs, cost reserves our in COVID dynamics

listen that the quarter, into quarter, QX. third us good top given we're expectations, of expectations into As some our expect as with move fourth but having think changed trends, our on we our the we I to I and will we're and inflationary think materially we of those selections in trends be shape that you're

Greg Peters

your a on through replacement are follow-up back replacement enforcer. existing homeowners, - talk that what do go they any levels me are for a we causing and off this lot set inflationary of about that. the approach premium how reset costs as walk pressures, Just When you can you the the Doug. are Maybe of costs. Is

DougElliot

Yes.

costs deals going back We state are our basis estimator pricing a into have we that now going replacement that and state that, building an resetting on forward. with by

So does advance, those book not spikes go to going summer earlier been away. these the were work discussions days of XX, since on XX have as but in working the part we

insurance and are So across adjustments we base yes, value homeowners' moving our policies.

Operator

Our with proceed open your now, from to line comes your question David, Motemaden will you'd Evercore from question. next David if ISI. be like

David Motemaden

question ex-CAT. a had just ratio for I loss on Doug lines underlying the commercial

of points The the kind I guess, saw improvement level of X.X which quarter, walk it impressive points improvement margin the quarter. you target why XXXX? of sort bit points, underlying but about of versus was two reaching could you know how two ratio slowed obviously you're Solid the for through in why, we improvement and last feeling still over loss improvement a decelerated,

Doug Elliot

that all long that quarter still I'm our direction say volatility global on little you mention favorable reserve a ratio. I experts and confident trend term property, feel over we did specially, so international areas would pics. and in our the and I was working consistent, commercial a loss the improvement, yes, had but volatility are couple against bit moves Yes, in like about if small think

David Motemaden

And follow on personal up maybe just then a lines. question

here. initiatives wondering if in guess last I growth good TIF know the you with initiatives about business growth or think some see growth. we seen we've five track the I have of looking higher if potential can six So, some you you don't thinking the alternatives you're of to kind that that TIF how I'm growth can maybe and to the for growth us some of just I'm share years. translate things and for milestones don't at and

Doug Elliot

don't test right, is is why I had as one. the that we states saying you concluded go into we that back I’ll to so just and top. start early over next upgrade we two and that major however So want before signs states move reason The drop product we the Chris expected. The dropping to through the contemporary we positive are to start by come two a our heavily now marketplace. wanted had years of several Beth then to

end, an then all-state, the program. year states months pretty by an additional milestones will end next so as aggressive by of major talked seven rollout 'XX of terms in I XX be about, So, and

you make will to We components. we're state but, know, about go corrections watch we forward very by excited the as state

those way and Again this this we've results I it's every from about that XX have to capabilities positive, our to path. way reaction leads to to don't but Beth think plus be We've profitable shared so long us rebuilt in They basically sit today delivered growth. set. the and different product and digital design serviced. We chassis here Chris? that. to think of helped us our primarily are which are any go, to have long a We the customers, feel attract the expectations we the hard or term bit listened early

ChrisSwift

product differentiated compete it we're summarized well. assessment, least in think rolled XX giving think can our David, years I states an out with you strategically, of were I make all fully a couple to after offerings. ourselves we at we really

lines. a Our we personal have hypothesis in strong going brand is in yes,

We have from endorsement a wonderful AARP.

unique features It's demographic have in how a that's this we serve growing. market segment. We

contract my relationship we have XX-year commentary, new we modernizes to that AARP how said in the a the go with whole market. really I As and

that's we're think worth ultimate did. more we making. it's Obviously, the count XX the think I an I watch Doug, PIF all - time in what investment post be But XXXX to states to period grow. would So did our start really we why when proactive,

Operator

will now, open would love from question. you next Gary, from Gary to question & be Our with comes Dowling line if proceed your Partners. Ransom your

Gary Ransom

period where do line, we're it kind to the trend. think gap, well? between that by you at gap? of of have answer that small And but gap many the cycle where years separately not in ask loss segments how realize three Regarding specialty better the about loss you the about middle I of rates are size we of wanted I into looking thinking so the much be was a might rate but been I as ahead have the and trend?

Chris Swift

very do We've by in different, I commercial Gary, curve outstanding an I period the returns. is of actually think is pricing different book it answer at that our of least think extended had segment, about small business.

moderated and adequate basically want cycle been not extended more So as the I have clear much Gary, period. small. for We there. rate a but rate an need trend, been has

at have The then stubborn. length drastically other about This had, results up picking own very ratio industry period, me, specialty that. into the part rate middle, We've have the eight where started weather pace call story. in property that. significant that's disappointing those has been of it of my in that had Middle auto property, need. had would quite and of needed coin that. really each quarter be Market, side of of some the a you of and a these from quarters, dynamics. very talked very to opinion, has that the And of will an those been XXXX. But second as And really extended entering other the of some We've an we've have had And our before areas some positivity loss of and their QXX strong lines areas GL cross-section to we're that flip And that. in QX, it auto so over industry, commercial I drivers

So those positive of on been have rate eight quarters lines seven, also movement.

and I think I Middle be to Market still don't comment. work a think in that hate done more that's there's area,

has look work get I but also of your But this as latter general And much we see. can think are smaller more think see segments intend XXXX. that's can I I have the half answered need of market as our segments a our what three I so in we yes, ways. only - after market across that adequate legs. work, book, in we we some still comment. move through rate at I question that we to and book, some

Beth Costello

your particularly Gary, in know, real. in impact, of views people the you writings, is of all given inflation social lines casualty

need our that it it it So forget financial lines, push can't X.X% then as knowing exposures. more days. be related rate, whether in the casualty And been these continue years for courts, internally, XX whether not long-term to trends in just to favor, whether be we in that talk have at the you be in the other

a intend we've of our a lower in to period from contribution underwriting for for greater component We talking clearly, a our and time. We're longer been it long do. returns, time. need to So fuel that's we just what about

Gary Ransom

XX excess ask I group, I put question to back can Thank you excess million to in different revise can it's about than where at in In you like I not If And the you're that. developed about QX, $XXX really as there? topic. the when for data, that’s decline much decline the QX. apples-on-apples, there? roughly not off seeing you that QX a showed on but and a your could maybe CDC that answer. comment you a look the trends said mortality, on going it - just falling I Is it more looks And from going in lot - what's mortality if apples excess that

Chris Swift

paying, It's Gary, I I the commentary, severity the XX%. losses say In I I it the in than we're quarter. at up, significantly, you from my quarter. eight I this you're drop that. at the second look calculated anyone that that - its probably I When above That deaths, is number which dollars, we we dollars, the in you that June. look right. significant. would are, close said from more it's mean of I or is had and beginning had Yes. so but to you know nine - is claims, are, fairly are you just What mean pandemic the we it's death say of up large if tracking was probably average from amounts if up million like down the $X peak, if from would

month. a when So XX XX losses we large you or probably had really expect for

ultimately when significantly; amounts, and carry to come all that been and to I and in half age, first tend is the they larger younger we've that about working to talking folks' And dramatically be So mortalities But as the the foreshadow is dollars. the face going XXXX second is seeing tried different. consistently, you half that, it together. put this we're increased of through

lessening half the of to and do be So deaths excess we mortality are year. deaths impact down, second - in the daily continuing a of feel

Beth Costello

Gary, add when that I'd thing looking only not to have we says that too, if that it's just talk that, mortality, excess. cause It's COVID. COVID a remind death The of all-in you excess at just you're that about deaths,

non-COVID came part our numbers, part when the than of we of large for quarter that excess in more look we a anticipated. - much the first reason so is And through revision favorably for the had that

assuming first bit excess anticipated provided a the as there. came losses in second we some we're well, Our for quarter we And better that in but be would mortality that provision the was revision. COVID driving quarter, when our of little that

It's been the are So excess as piece, through when which, you look COVID truly losses coming coded it, has that COVID are predict. you down. as hard that to know,

for just us. not it's So

Chris Swift

that's a outside mortality that just there deaths of, the flu first The COVID. great seasonally, you numbers. could But be, of than clarification. a first, we point, excess had Gary other we for the quarter less was expected clearly, for sort The Beth. in Thank all theory benefit

Gary Ransom

Thank answers. very those you for much

Operator

would with from would question. now, open from comes Fargo. like Elyse, Greenspan Wells question next your be you if line Elyse proceed Our your to

Elyse Greenspan

to of Chris, comments. My some back, your first to go question, I opening want

than higher like about on inflation worried a of most you're the that assumptions just actions, I'm what data taking know but inflation running pricing if you of areas this this. hoping be call, then your terms got out considering I could against that guys pricing mention ratio if expected? sufficient little bit in your we you And elevated inflation you are imply actions recent impacting pricing considering during you did but mentioned You loss so profitability. that But touched flush you also taking wouldn't might taking

Chris Swift

tag Doug And will team here. and I

yes. So

I think comment the up. general is that inflation

fairly You've self-evident. others have written It's about too. and it

in picks we think are at are out positives basis, homeowners' the on property property and negatives, our whether to we and positive, out mostly are looked and all there's year activities picks, I Doug a going our as particularly loss as when that are or When severity think being hold. our loss headwinds. and the for that it against positive be activity, we it activities we pickup, where and frequency, lines, there's net ratio large full still the picks home inflationary nets described,

we're and inflationary Schedule that - As, pricing have primarily and trying that in to the our actions we the some about on to on with and keep line, Doug, we've side, up think values. new things A keep with schedule talked that up homeowners' I are programs values some So insured where we've particularly added

Doug Elliot

insured in our Absolutely. properties. and And Market values we're in at also our Small looking addition, Middle Commercial

of this issue through in Elyse, on cost to terms buildings, the repair are will we're sold. goods cetera property cost what in et with So feeling we - top replacement, of general, facilities, what value of it

Elyse Greenspan

Okay.

just still other on you this Commercial really home. your would line inflation, then is property in Within say your Lines, and with So everything is expectations?

Chris Swift

together. we're been We're chronicled - little will to auto get labor timing in, obviously Yes. parts. and parts The because matter well severity put it's watching That frequency the the carefully to watching pressure severity, they parts, a auto there. the bit to and of

quarters in and us say several but as better for know severity we're And - to can't had comes But out all in. some exactly to lines. the are going here have data curve quarter I going today of we're that on good is what think we've like look sit how fourth offset I our we generally, labor into So will the drop a figure dynamics. It's and take of material frequency spot, patterns very inflation tuned the yet. we that to

Elyse Greenspan

second you the to plan ahead of for my then running And Okay. outlined year. question, guys buyback are pace this relative

than of from I you subset, little expected. And some think, the you the higher are figures a bit had dividend provided

front-loaded? of be if X.X guys you take could buyback the So above come the Depending your this is for chance more to you upon potentially program there advantage, in look stock a is, year? could

Chris Swift

Yes, I'm noticed Elyse. glad that, you

our I We in have my said, comments, as and in prudent been, proactive managing capital.

into you acceleration time, buying but capital. possible, again, basically the action two-year billion program. buyback our marketplace. our seeing still any a say? one in I deceleration what yes, would months things on is, period excess the we're we're But one what right manage be six of So, or lot are or back $X.X to there any And of Beth, quarter happening from could depending think

Beth Costello

Yes.

Elyse, on it the primarily characterized range the I to P&C. well, think tightened think dividends, we've that I we relates yeah as

$X.X So we to $X $XXX we're - billion. million we said billion $X $X.X billion, at that billion now expect to had and

that that's program the but increase a period. the on pace. side not that. in think the a shown ratably in the trending said when it actions change good weren't on there. we're And think had we announced April We I And to that over So we've high significant I we intending taken do have

So that's add. I would all

Operator

your from Brian to Our question question Meredith from now. line will comes proceed UBS. if with your be Brian next open you’d like

Brian Meredith

Yes, a you. them of Thank Yes. couple here.

are comp, I a to little going look that's dig what expect just those respect XXXX workers' indications forward? and what we going potentially workers' cost filings Chris I can what for pricing that you First, determinant that, NCCI at bit workers' want key kind for Any with to a you're looking look of, and for early like? What's saying on to comp. loss comp Doug, like pricing Doug. know of here mentioned the

Doug Elliot

that into extremely jump Brian, next the days, season. is early, it we but XX

states one, to the of states XX yet. the not comp most frequency. in And but COVID. maybe days, maybe we've I same XX a from workers' COVID them the how The of selections will quite with days, is is hit think been then have do our this last for have drop, I treated and apart true XXXX all So year next perspective, around our two competitors. transparent couple both I over know don't But pulled of

have lens actions, bureau So more handled they MCCI into we'll learn I great you through loss data. for And think the know, the reporting I everybody's but a don't states. XX cost as

system. is comp that component this country's of a workers' So big very

Brian Meredith

markets formation people some economy going some in Lines talk little nice for bit is Or it's so And see new a that different then think of fall if E&S in the business mean, that Small businesses we statement? to the in beneficial the really as where typically see Commercial. doesn't one the second question, that continue I new way growth? I'm more good just Is about curious, reopens, are growth growth you because in the standard true Commercial to really could market. we a big about economic things things

Doug Elliot

Well, is partially that business. good I our for probably growth is true. a thing economic say would And

think I true sector. it's by

pricing our at points decision look and they class. They So at our geography. algorithms sectors do class, underwriting at look of look

also I basis. So interested we're there fit would are say writing start-ups a are Commercial And new that retail sectors there E&S. of probably better on in Small business that then

will point I'm which in it some be think raised a good labor second saw half. a forward. we has But of you occurred glad for and our the that thing is because the economic feel quarter, the our adjusted real that think why engine, that we in I provide premium spring audit unlock second I further will don't I like yet, and going the

Brian Meredith

Doug, would to our business that say E&S us that have class in leaders two you But sets Commercial, business that, we a is can do historically, also we help that offerings in Navigators Small expand the product partner of provide going and obviously, on.

just that's more market? business needs, capture or be to the So E&S the in standard part it of been of whether design small

Doug Elliot

start-ups E&S are known, of in new Specialty, all experienced also Small our that first-time in it's to Commercial we've core I been our so capability add, a other Some obviously, run that both, space. new your a sector question, would businesses, Brian, with also growing managers people but the that wholesalers working has right? business around start-ups not with Absolutely, Global strategy we've leadership in insured wholesale these in with and places. are the managers, these

number can to as in be formation And business. misleading. So we general, a the positive a economic little start-up look at our

Operator

last was question for our today. That

back Susan to hand conclude. So to I’ll

Susan Spivak

all Thank have you, don't Thank questions. appreciate you. if this us any Harry. hesitate joining contact Please We morning. to you you us follow-up

Operator

today's you concludes Thank joining. call. for This

disconnect may your You now lines.