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Hartford Financial Services (HIG)

Participants
Susan Spivak SVP, IR
Chris Swift Chairman and CEO
Beth Costello CFO
Doug Elliot President
Elyse Greenspan Wells Fargo
from Derek Han KBW
Gary Ransom Dowling & Partners
Josh Shanker Bank of America
Mike Zirinski Wolfe Research
Tracy M Barclays
Andrew Kligerman Credit Suisse
Jimmy Bhullar JP Morgan
David Motemaden Evercore ISI
Call transcript
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Operator

[Operators instructions] Good day. And welcome to the Hartford Third Quarter 2021 Financial Results, Webcast and Conference call. All participants will be in a listen-only mode. [Operator Instruction] [Operator Instructions] I would now like to turn the conference over to Susan Spivak. Please go ahead.

Susan Spivak

you. Thank thank webcast joining earnings. on and our today all and call third you morning us for for Good quarter XXXX we posted on and reported the Yesterday material earnings-related all our of website. results

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

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

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

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

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

Chris Swift

quarterly book We quarter, repurchases in share, core is per by Hartford. ended X% XXX the growth we evident share execution value for announcement by evidenced to and share we AOCI, end XX.X%. also in million bringing a XXXX. the each of of cash authorization shareholders continue XX% to XXXX. core earnings capital in million morning. and that diluted report or and XXth. X.X us dividend investments strategic for businesses billion quarter the returned generation, common $X.XX total the January quarterly a you program our The months from year-over-year earnings by support XX-month our deployment with the confidence of billion X trailing shareholders. per to of in the the through our we repurchase return and With In $XXX ROE for our flow approach payable growth excluding million, about increased XXX the reported underwriting increased September increasingly business share. have we diluted future in dividends, X my and this joining again, have with strong confidence balanced have reinforces on the capital Thank outstanding capabilities in And initiatives we becomes Once third consistent earnings to to will

efficiencies, alternative Looking margin premium operating on through to underlying the written expansion, with a positive return growth, investments. significant continued the momentum results, and

strong retention, results were an top-line Commercial in the by and Ida, levels, Boy pandemic-related and with Scouts XX.X% ratio impacted margins settlement. new and growth higher continued Benefits, America renewal business another higher reported increases. However, stellar Hurricane Group combined lines reflecting double-digit excess of price underlying solid industry-leading mortality

opportunity in And am decade. Doug commentary. more well. in experience this with In to times of progress mature to more as a platform segment. provide one in product. in the expected market groups over the Through the being grow to made pleased the modernized will the to as With new transformation next rest on we is continue I of the partnership demographic with personal the with the U.S. population, America, teams fast a see introduction in Our the growth three platform. provide capitalize We're of exceptionally of midst contemporary affinity largest execute a the lines. AARP, the

been the Boy councils America. and majority with entered we quarter not This the the but now vote includes agreement expect XXXX. the in occur who the BSA Additionally, Scouts conditions officially claimants of a of The of abuse which now sexual on occurrence only asked local in early have to of Hartford to principle representatives into agreement certain in becomes settlement we the BSA, bankruptcy final upon new plan.

by strong reporting growth above group the growth. quarters, in-force long-term excess turning Fully continue. prior X Core returns, over short-term to earned our past year. and Now over premium results, Group trends and have In premium claims, benefits. reflects year. were XX reflecting partially improved been Throughout in was year, for disability and prior persistency. we elevated disability earned mortality over earnings million quarter premium approximately and life been ongoing continued sales Persistency investment has quarters. by these insured point The increased offset the up Life book XX% is growth impacted the in positive industry X%. This X strong

mortality. earnings July our in During related that would calls, lead optimistic improvement we COVID trends to an were

increasing was U.S. August due the started short-lived continued optimism and the in variant September. number of through as deaths Our Delta to

across quarter of the As likely in due book week, this of exceed deaths deaths lags in reporting rapid to to weeks elevated XXX,XXX. is our data. quarter, industry. ahead third in And COVID a to The the the business continue the now COVID U.S. the this drove increase number and in for increase mortality third in

cohorts has surge XX August individuals in on higher resulted in claims. of mortality and deaths under tend death of XX in Delta and increased September, percentage to the compared the total XX% levels compared dollar of COVID amounts, mortality January of the Approximately December the population experienced a impact deaths under age U.S. of of combination amounts insured COVID XXXX of were XX% approximately values from carry higher prior younger a to and in significant increase reported of face higher Since XXXX. to age Additionally, periods.

broader non-mortality third consistent trends experienced higher excess approximately the is of the U.S. excess we saw during This mortality quarter, with representing elevated reported XX% addition, non-COVID loss. quarter. the In levels of that mortality directionally in

help quarter, line, is What confident do the and mortality claims. to rates mitigate levels mortality is fundamentals savings look Group the we in across challenge. the our performance lives remained a excess vaccinations and about optimistic are higher of we know solid business we Bottom should future. and that Benefits forecasting are the vaccination As fourth

pandemic the is a well roll-off. less trend of to half and do on are natural Well, remains employment last of the confidence mix. overnight. a believe economic to COVID me inflationary conflicting I encouraged not remain deterrent growing normalization of to will increasingly causes while backdrop, in the be downward months as core for Headline the well. 'XX the and focus second begin I inflation of businesses go solutions elevated, believe Turning continue as ease return to in inflation environment reopen surge. couple pandemic-related that in Vaccination to gains the borders there will levels expect individuals and workforce. become signals, 's business U.S. the which performed and to as on bodes on This outlook chain and rates, one the sectors, pressure in Hartford Delta hard-hit but is global the the the XXXX. macroeconomic supply as governments pressures The stalled decline. sector Unemployment of fully the well private immunity seek for by inflationary expected away to therapeutics, was of the will impacted Hartford's employment benefits provide

I the my of proud As made. tenure I progress with reflect extremely we've on Hartford, am the

the successfully years, going more we made talented to organization underwriting fixed result forward. and and the by even Over investments new segments, added. industry capture and to exited Positioning dedicated our marketplace businesses, or one base. into Company underperforming in expertise, operations the have opportunities digital we core in non-core is capabilities, integrated we leading culture product depth direct This employee a a the the a significant tools with and transform exceptional complemented performance-driven expanded breadth of

is journey the However, not complete.

prudent differentiated term continue financial growing and value With very management, long Hartford never deliver revenues, customer talented the in strong to positioned the our look continued high-quality margins, how results. become the for for to producing the the to highlighting investor team. while objectives that business competitor senior for XXth has more is and investing forward enhance November continue sharing better been I out-performance, I'm stakeholders. leadership will all to At financial franchise, an all on superior capital our positioned a experience, conference, even We confident

Now I'll the turn to Beth. over call

Beth Costello

XX.X reserve earnings in personal in in commercial claim provide commercial by for compares Core these In quarter in premium which a prior year XXXX, and XXX excess XX% combined ratio Doug detail a strong results, the XXX core miles written reductions additional catastrophe underlying highlighted higher combined Chris. increased continued growth the $X.XX new Benefits. Hurricane frequency BSA, more ratio bonds. wholesale quarter. lines, share, to ceded development will moment. the you, reflect of lines underlying limited of third year with from a from the million an underlying compensation, Group quarter the of in and million, commercial lines XX.X a earnings and accident construction. or diluted XX.X severity. an in ratio mortality underlying P&C including quarter, produced results offset settlement of we prior XX performance within Ida, investment of XXXX, quarter, reflects improvement driven reserve improved by losses, million of from unfavorable of development workers lines million results the X.X Thank auto consecutive adverse partnership the of on the in the related from higher excellent personal net In by XX% investments segment. $XX package, In second on was reserve XX cover driven million and In our by per annualized of auto to Navigators XXX TNC, offset agreement third to of we XX.X, X.X-point million primarily personal partially with excellent million, XXX for combined business, and points quarter liability, decreases return an

long-term ceded, million prior increase XXXX, core third partially million deaths, from quarter a in includes the attributed XXX more the related not Group margin disability COVID-XX to periods, remains in driven quarter by by mortality net million loss earnings and which total. lower favorable of Although due significant than trends cause XXX ratio before XX past, specifically favorable recoveries -XX pandemic. quarter has been offset quarter early of development these Life, disability resulted Excellent mortality this short-term earnings Group higher net points of in core in of predominantly of million incidents and prior-year second All disability claim from reserve short-term losses disability the third mortality, XX% frequency in are as during XXX claim the was excess in with decreased excess gain Benefits percentage represents excess X.X economically to reserves. to excess tax, is ratio this XXXX. in income. net disability from representing losses XX.X%. deferred largely from higher related the charge positive, the to The approximately cause from prior-year XX COVID of it quarter stronger quarter. was The the against the a stages mortality of income offset million rocket loss a was by in loss underlying for in the and investment procedures The medical year's elective fewer the quarter development benefited

compared vaccination and are excess of the it strain workforce, in rate, dependent variant. percentage is spread same hard Improving contributed The system -tax predict have who illnesses. the of from infected of the in savings chronic related ended the the period XXXX. on efficiencies on The in forward the healthcare going COVID impacting ratio $XXX Hartford a as commented, to operating those treatment claims a the to the and X programs incidence XXth, in in new XXXX, September pre expense is delivered potential months the number Next factors, lower margin and Chris of million expansion. expense As non-COVID including mortality to

million expect $XXX in -tax in $XXX of XXXX XXXX. to savings and We million pre approximately full-year continue

compared compared million average earnings AUM the Turning Total Reflecting of XXth the XX a with daily AUM quarter Funds, fund X.X net and produce returns net in with appreciation. under billion to Hartford excellent increasing billion. Mutual prior-year core Hartford for the XXX growth inflows was continues impact Funds third assets management approximately quarter XX million XXX XX%. million of driven to at by with inflows market September outflows net for and XXXX, were period. were

primarily XX on earlier has due loss prior-year XXXX capital to was which over was a million to equity As outstanding, consistently sold The Talcott been from at before in Resolution, the quarter, in interest corporate since Third XXXX. loss XX the million low of business XX% it's equity a tax core XXXX. a million return in compared lower Quarter in loss $XX

Turning income outstanding private expectations. partnership and another in to million to exceed Limited of annualized very investment quarter, from returns higher equity investments, underlying XXX up delivered from estate. continue strong valuations partnership Net our and was sales investment the of of quarter portfolio real funds benefiting XX% by cash prior-year results. XX% distributions investments within driven limited returns,

the manage focus on portfolio We while partnerships, yield, to before capabilities reflecting the X.X% market lower interest continue X% limited portfolio rate public a to third the was investment quarter to annualized compared in attractive. environment. opportunities. take our excluding with investments, of leveraging The advantage XXXX, high-quality total private of tax

$X.X in with down was the core earnings due at credit gains maturities before losses billion maturities ROE excluding The at trailing XXXX rose Book per strong no billion higher fourth $X.X X% September September interest XX.X%. tax XX-month expect and quarter. from portfolio XXth, for to Net fixed credit XXth, We remains on pressure to credit $XX.XX. XXth in diluted to continue AOCI our June fixed And quality quarter. the on wider spreads. since realized on value portfolio the rates yield share

or million XX% During X.X billion million billion by XXth, the $XXX proceeds repurchased increase holding authorization investments at to October through $XXX and $XXX repurchase an of common shares of the increase were through be approved Yesterday, the billion XXXX. X.X redeemable Hartford of million including dividends XXXX. September From million authorization XXth, remained to at of effect XXth, a in senior used the cash in repurchase includes will With from September through and notes. million million of of in share the subordinated the dividend, $XXX share XXX and repurchases for quarter, after our X.X% which there repay million, shareholders, par share million common junior issuance we the paid. returned XXth, the These this Xst approximately XXX of X.XXX% X.X as proceeds on September October are completed repurchases $XXX common which debentures, Company $X.X April increase Board

underlying cash we received capital approximately subsidiaries operating margins, fourth During growth, and in efficiencies, million ongoing expect the dividends quarter, third XXX quarter. the million XXX strong from in and flow, With top-line management. improving

generate shareholders. the call value consistently for turn I Doug. to to will market-leading positioned enhance are now We returns over and creation

Doug Elliot

written quarter, Thanks, with ratio Beth continue everyone. achieved XX.X. morning casualty, and consistent and strong, lines consecutive our and good quarter. new states in is accelerating and Across outstanding I In was second execution second for October. rolled our pricing out property the Written growth launch to underlying largely combined be X quarter. with product double-digit the with remains premium pleased an performance. the Commercial new extremely personalized

loss from is for stronger ratio. expenses. I've and a I produced presented. the from long doing of mentioned, calls one points coming terrific over another a commercial quarters underlying and these time lines the of been Beth ratio this have X of As XX.X improvement with underlying combined point

strong spend at and Policy more policies record, let prior providing minutes trends, over year. XX% performance. Small written a another a X% in-force of was count was grew color premium few loss Before of on exceptional a XX% retention quarter year. just pricing versus third quarter billion commercial over prior commercial increasing detailing and me topline

a and consecutive benefit business was up As the of double-digit $XXX economy anticipated, XX%, contributing new increases improved the we from Small in fourth commercial continue quarter growth. to-line quarter's result. million to with an wages to payroll of

across we're [indiscernible] the pleased particularly contributed distribution with market-leading commercial small and I'm growth result. of our achieving equally the channels. compensation workers each to Our

will a Middle-market verticals. points the payroll New part business distribution X% unmatched double-digit by XXX our performance. a direct driven Policy business second X% we new this large large consecutive of XX%. from growth delivered written XX%. top-line in excellent and agents, X quarter of was middle growth, alliances, and up increased retention The all million breadth contribute premium to programs, and meaningfully balance of quarter, competitors. In produced or with by continued to commercial, is depth industry in

the strongest quarters quite of time. some in retention One

disciplined with We profitable retention tools and strong premium to maintaining trade-off, continue of growth while Global to another leveraging balance and growth. risks written segmentation Specialty produced rate drive the our underwriting, quarter XX%.

XX% was New impressive business to U.S. growth in had and franchise, written past needs. further customer an XX% led Execution in to of premium been meet wholesale XX%. equally these was remains the breadth our our broader excellent. the quarter with and premium X expanded of written lines. strong XX% has mid-XXs. growth continue Reinsurance Global In develop retention portfolio with the years excellent our product financial of in risk fully quarter, to routines by also our operating leverage growth we solutions Across

point, third quarter a has initial and was product a of With of million. than goal only commercial our Global become between exceeded XXX have this portfolio our premium $XX year Specialty get As transaction will million execution a years result, now proof and cross-sell, we strength stronger. large After competitive our business middle and new development, early. more

remains workers X.X% and standard to compensation was change with compensation the price Middle-market continues X.X%, ex-workers metrics. pricing, commercial was move second to of flat Let's quarter essentially X lines quarter. U.S. consistent pricing excluding XX% to XX%. written exceed Quarter loss Global renewal price and strong trend. with the at in commercial workers X.X% in line pricing In cost international at Specialty was X at U.S. standard compensation, renewal written

loss in casually in ratios quiet, weather loss expectations. are [Indiscernible] pretty a was small property. year equity commercial to current our line It with Turning quarter commercial trends,

costs of trends loss pricing XXXX. for severity is the confident the our impacts adverse property XXXX trends to supply of the monitor and and exceeding expectations. still loss lines. to rest on remain within continue elevated ratio Earned most chain year And we into expect full-year in we loss addition, be In disruptions

lines, comment environment pricing one markets pricing commercial several of lines, of in And let I've Before I no over actions the question environment. are experienced hardest we've strong and rate the underwriting performance. on to years. central the The There's decisions, past healthy our move personal drivers disciplined a of me to X combination these X experienced.

that Continued leave remain environment to weather, will XXXX. believe chain, into healthy pricing current me inflation, from supply pressure and the well

points parts, is pre quarter below the levels. modestly to used frequency to Moving and we XX.X XXXX. severity Auto and will home, initial expectations. from with third offsetting In is labor. expect the be of rose labor them -pandemic but ratio miles trips increasing in by inflationary headwind underlying factors versus we cars, still to than traveled, elevated, These experience material continue XX.X. personal into lines, combine to Auto claims severity an part continue vehicle to More elevated building driven costs. rising up and frequency persist favorable higher cost industry our as

Turning the was Power X%. remain shopping that business to This JD business premium at rates new ago. premium segment below age quarter. uptick occurred insurance retention plus relatively in despite year concluding the XX% results among auto Policy topline, declined up new was a written X% X% survey stable and XX the

and With and We're home the states. written Our product premium, Personal now expectations. capabilities. bundling new results latest by with responses telematics products exceeding enhanced Both prevail. I'm contemporary our we rates. was third and early the X in marketing also pleased by are issue early new Auto conversion and quarter's launch October, our available Lines and spend in quarter, Home the momentum. driven our accounts higher Through are improved business auto growth of from also launch encouraged this

to prevail XX driving This more as be with is models on leader, Mobile continue the based On important states our days. excited partnering The next the Cambridge augment will over into latter, behavior. product industry we to be an change Telematics. we're the

the a incredible casualty call conclude back Property for turning to an and with Susan thoughts. let Before had final quarter. Q&A, me few

second year seeing about multi-year with earning [Indiscernible] is a excited and personal Strong roadmap products, be quarter Specialty of to launch the continue and and current of consecutive the produced performance, execution. improved ratios. our broader execution driving performance. pricing prevail is positive delivering We're of lower line underwriting top Global superior clearly we results into selection, commercial and deeper loss book and strong the Our risk lines. outstanding

This quarter demonstration those is capabilities. of another

continued details agenda invest has I'm been and at Our the our clear November sharing look with Investor and technology business more and forward progress Day. heads results are significant the to thrilled with in our sustainable.

me turn Let to back over the now call Susan.

Susan Spivak

Thank you. Will now take questions.

Operator

the question-and-answer roost. begin pause this At to session. will we We Instructions]. momentarily [Operator our assemble will now time,

Our Greenspan first question go Please come with Elyse Fargo. Wells from will ahead.

Elyse Greenspan

first millions magic capital plan. morning. is question it's the buybacks. X-year Good thanks. on incremental of Hi, I My know side, a

is are come dividend buffer funded a less this HoldCo you both? So a a year And maybe year? that of holding then or is higher just to or next of that expected being combination little or bit with for

Chris Swift

add Elyse, I'll I'll to commentary. and start then ask her Beth

here today, performance. sit confidence it's we As business a obviously sign in increased of our

Our of will Opcos our flow cash-generation, eventually capabilities holding to that out coming Company. the

liquidity, did, we any haven't We our interest interest in the far future of the it's but you in as took we our here here we're as performance we to look Beth, hold generally more, X highly and action confident dividends. add? -- times today into businesses would our in HoldCo the want what and 'XX heading But performance of sit relaxed 'XX, we as still their in standards at

Beth Costello

we Yes. timing under said billion authorization, share What a the think in with XXXX. I X.X the a that add is, in we we had of the as recall, billion you about anticipated would 'XX, billion as X repurchases,

by million XXX increasing So

Susan Spivak

gives XX XX. consistent us in be with the relatively opportunity to

as the said, change this felt capital we're of business to look appropriate looking XX. Company, levels we significantly not performance actions. was again, for out timing laid and as the at the But underlying of we holding at had So what Chris already we

Elyse Greenspan

you and you're commercial trend are on within within has what assuming commercial for my And Wasz absolute changed underlying your loss ratio second within can commercial. us across your recently? question on improvement that How book then rate much Thanks. your and And book? update then trend year, pain

Doug Elliot

fill the will me start, Beth let and Shirley, sure. edges for around

improvement, to adjust COVID. points As I mentioned, got loss for over commercial X of you've

But So half that COVID positive in then is essentially, are lines our our lines, year-over-year. of core across a rate. point all change of and a earning

the rate I think the And current drive it's I that as so positive that, about look from that change, and into so adjustments think changes all as those sustainable are we variables coming the weather We bit fourth on small our but quarter. in had the rate good basically improvement. a news lines non-cap property specialty earn it's driving the primarily little lines other commercial, CompGL,

Elyse Greenspan

Okay. Thanks for the call.

Operator

Our KBW. come Han from next ahead. will question Derek with Please go

Derek Han

Thanks. is comp. Good question on first workers morning. My

One driving to that competitive Kind inflation to what kind of talked year-end pick up your really and Can talk the inflation seeing of environment. now trends competitors medical about well? just about wage potential and frequency the of until as rates with you you're for XXXX. severity inflect

Doug Elliot

of I'd A the the environment earlier into as, than we year. part start saying what few saw a X by that pieces different lot into question. to competitor that X not quarter

period performance that you will for of small, competitive inflation towards years, we particularly trends, across expectations range of our been a a filings a environment. see come relative end comp long now not to perform. think the turn remind right, yes, expectation. moving five yes, We performance our consistent - these And that years. And trend rather comment of the our continues in state a because I which positive to continue. unlike last we that a 'XX I have extension a favorable based we of medical tame had been sign lines excellent, I have long-term that period plus long-term think people prior businesses, has because not couple comment and to so of our the fix that that that of the expect of then bodies towards adjusted expecting in off, about inflation, workers will little term that are end the couple bit to fair see long-term year, medical be our do through variances, we've on we're think looking fairly the XX but regulatory that The are now, of any for towards pandemic. other frequency, So the see is

Derek Han

my adverse maybe And second you Given the to last of the are in It reserves? How really adverse loan That's there through years. navigator's you the your blowing about like is few helpful. then feeling quarter over had question cover. away Okay. $XXX the from that on looks the top million reserves.

Chris Swift

and the you as that turns in our absolute ratios, heard purchased Derica, views homerun improvement of reason. loss all was out of I we're to for those in to our to I'll we that start that think just part the you remind And again, recover adverse going a acquisition it finance how be are to additional the an ability the in from Doug, cross-sell, combined improvement the product, that house. capabilities now

I tremendous. think is

it what tail would of and but we going were takes some risk obviously Beth part add? that how again you it was view it to finance So we off,

Beth Costello

ADC, changes some we wholesale think when we really were overall, think even of mentioned, book. with reserves this the the action just that in As about [indiscernible] in that the the of or that without I And quarter, the that small took increase I navigator’s and construction when the and this balance we and factors quarter overall relatively made tail we think you had reserve that about sheet have. and movement

Derek Han

appreciate I the all color. it. Got

Operator

from Gary & come with Partners. will go question Ransom next ahead. Dowling Our Please

Gary Ransom

morning. Good

that affect reinsurance fourth the quarter Regarding where could how you are and reaching of understand the or might terms was wondering us point I cover, if attachment in for? help cap limit you aggregate

Beth Costello

great Gary, question. Yeah.

cover get yes, million So do of cover aggregate an losses have $XXX and protection. seeing exceeds we provides when that $XXX that that kicks in million

cap September about that little to the losses when less point. $XX to before at go, million look hit attachment we you And XXth, so we have we've through would start probably than million that $XXX had

Gary Ransom

seeming year probably you it actually was very that? even rates we have that have [Indiscernible] lot what more If leaves XX. bit much. thinking involved a I or deeper maybe it's is thinking into it, The I It's think a But of tourism the right. what about be into you And assume of in and view stabilizing. rates. may for flowing market on how Doug us different there on this. a were earlier causing All deceleration reason leveled I you of out Thank then those do XX see some you factors and about compare to And that's in will how are part the worldwide that.

Doug Elliot

Gary, with far. so I right, agree you,

very I the you and the of We for book, script. I think Looking our property weather. as look supply stable and in at risk, inflation expectations, the within the to in cost them mentioned core would my suggest. year describe chain. QX our non-specialty We the at guaranteed compared about drivers earlier reasons

of to I think sure cost be that risk. drivers of our factors those we, that types as a make are covering further underwriters, will

cost, book. some we've so area, where think changes Yes, Specialty would rather of I in particular And be couple commentary the of lines. pricing, positive. last as my core-guaranteed in but in around the those sense there's to seen dramatic price books those [indiscernible] correlating of in that then improve the the been non-specialty And moderation, dramatic in adequacy the business

property to steady where now. but the surprises, for and a supply think prices are factors a go keep We not of I others particularly think chain do total, area in major are. period relative and these So threat will I you in time see they as whether

Gary Ransom

helpful. that's Thank right, you. All

Doug Elliot

Thank you.

Operator

go Please with from of will next America. ahead. come question Our Shanker Bank Josh

Josh Shanker

Thank rate much. the and Still, growth I'm Re internationally. you very Global in at looking

Re But the and acquisition, a out you your X What business you you when fall of increase achieve with and but how kind your are and about and of the of space navigator’s producing international fit firewall, to lot does complete model? agents whatnot, want the talked Now, Global do this of those in in what hope your sub-segments? to shelf strategies having a products. shelf

Doug Elliot

I'd start selective so a with them, thoughtful This matching. quarter is group RE, approach within but and it's place. here a we're to XX have small you have segment successful for to really a put success. us. their very seasoned Global it's in added risk niche in our smaller portfolio They expertise a the of their been for very underwriters pleased about context, the group. And their It's

bit if see our then regain international, So them shareholder are little absolutely first the couple but And years, strategy, stated our success, you on focus our contribution right. of primary part to of much from to mission RE. a I Global to our separate relative was a very

We couple in of have a very Not [Indiscernible] internationally. had of the performance years disappointing marketplace. unlike others

better And ourselves our so much financial we amongst how at grow and we debating forward, about feel we're we've about worked now look that And that exploring and portfolio. performance. as hard

and I'm it we'll have most can platform. we have past a an I a Really work to that that think product you And of future. about about area bullish think across competitors talk us solid obviously marketplace, time. the the Not from. talking So I we families pleased our we very there. is behind platform the unlike in but we what our were Lloyd's over to do more And specialty about

Josh Shanker

a How stuck the business with for loss with loss it's ratio Should pick you prices. kind being business to have reopening to a AARP, model, a business than right think new be lower legacy right. new underwriting up compared with you're And the auto used lines. the I about ratio? and personal the order tough under customer. should where [indiscernible] the new All relationship not ratio content period business or then on loss previous now on real a the sure, the of hand higher Obviously, where car

Doug Elliot

of our given the with what state-by-state bi-state where in are answers, and as question products, states. approach I based spent and the as see we different Well, slightly answering we've by we time on start these would saying, lot we pricing opportunities launched new have your a probably

the we not that see ratios and loss we I lower in to fact expect current book. than in new the So do jump would our

We that has have will a to we're we as auto very season our season features product to continue and significant solid Telematics program. a about much time, that you be a It out. got like And contributor continues And earnings, contemporary; space, book obviously excited to what over but this what we do with it’s doing we're our can been about underwriters talked lot. with the I've new platform. with is more to

stage we through watching to I excited country time XXXX our the roll early immature we're early will the key as I launch as of that of increasing will driver the the be early in prevail the So, in be too That it's continue rather a about profits. rest new of but with progress. call, so moment, it's rollouts. and and to think At about think

Josh Shanker

And that's --

Chris Swift

Josh, it's Chris.

Josh Shanker

-- Yeah.

Chris Swift

the serve again, XX's, members the particularly of add. in I inherent in XX- the remember is to AARP just will part XX-year-old. And well. Doug strategy described it to Again, there

given flexibility think base broader base various agreements, expect underwrite. various in class that do in we various give plans, the our us they're not it our set lifetime flexibility, Is X policies, with states. to population again, renewable. But added to have experiment the no So -- does we a I states meaning guaranteed months rates continuity

Josh Shanker

And multi-channel? is the product, or new direct

Chris Swift

seen channel. it It's agency is ago, was right to this very compared direct direct business, small you've I years AARP but our where inter-consumer it's dedicated. mean, our

Josh Shanker

you. Thank

Operator

from Our Mike next ahead. Zirinski question go come will with Please Research. Wolfe

Mike Zirinski

follow-up Great. morning. than sticking your out Happy auto terms are still it to in And we different in Josh's little questions, Good just appears good. results a mix of still is your guess demographics. many Friday. as follow a portfolio I since

sounds pressure. in there we it we be Just or some to it are of lot loss you about like in a should the potential over or more rate year push I so? curious, baking or coming rate trends given trend think inflationary continued looking your commentary, should the versus is think kind how

Doug Elliot

facing. not across-the-board. is and satisfied etc., Mike, immune supply with chain that are financial return our in business. solid that's I rate But that basically we're would used adequacies. say from the risks fair. we the Very auto strong prices, industry that in

front. active we the So are on pricing

country. are We across state-by-state working the

as even to construct, relative I that the have work as area What product facing that here. more our We issues flexibility prevail. be current enumerated product we think in it's chain supply we're we to XXXX But Chris active through an going into are upstairs working. say would

actuarial on front. the yes, active So

Mike Zirinski

just gears, great. kind stepping maybe the for a Okay, the Switching forest maybe so. back of see to trees workers to and bit comp

been focused much on better for driving can the results despite expected over been workers Some investors of some than looks loss be kind of you has while might soft years the especially guess a expected the much But than It now, maybe pricing, environment specifically What the comp of better like for been older cost kind trends. have over to really for talk I the what's pricing improving. the years, have excellent. which vintages? recent

Doug Elliot

be our you for people a day That of away. all sauce listening, you. but I good secret give can't this other would share I will with

a sophisticated have across We markets. very modules shares pricing our of

geographic I segmentation think think workers about -- work cells, strategy we in compensation think etc. cells, and deep industry about and

what relative So our valves fundamentals business, in the of workers do strong to we down really

Doug Elliot

a data of frontlines think think I are success analytics data. when think And our getting share has, as There's of say, use And the in you X X the competitors have in tailwinds. will I of long that know on trends the those years. X exceeded every compensation. X numbers the past strength pretty frequency workers' right? the data So performance but term that, and and has years, been I good for combination our science, I third-party drive we this with to our and, those severity medical that moderate last long-term execution are Company, just quarter. lot before, would inside well talked the understanding this the these here our you been about shape, rather Generally, comp. we moderate to over better

Chris Swift

know a built. I efficient our about brokers days, to given our I interface internally. again, in just add, we talked these way and digital ability that capabilities would with Doug more Mike, our a it just agents we've

interact easier great with on other time. turnaround I competitive with an for or think does forms basis agents fast advantage us data provide a of distributions to

Doug competitive our side, talked the go-to-market that digital is the matched about capabilities. equally analytical from think advantage with I So

Operator

Our come the question GT for Please Barclays. next from Tracy will ahead. M go

Tracy M

morning. you. Good Thank

of underlying commercial rate, margin and color of is in expansion Your appreciate I the ahead impressive earned lines quite trend.

comment Just your your X-year rates? you Could pick. direction How out XXXX another access there. on XXXX does question year loss and compare that of to the

Doug Elliot

you because and So when think the to -- about Tracy, the actual we've let just maybe our picks got refer year-to-date me year start a supplement we current in supplement.

side loss strong. the on underlying are really numbers Our

So XXXX 'XX, does nine if result healthy you thoughts in think has to and XXXX. very shared a guide versus months Beth written stronger about and of nine that the look as pricing months of they're ago in I at back of of really a pricing 'XX bit

encouraged. we're So

industry contributing this a businesses still we actions to thing There's have morning. number the number. relative focus, other to about and are we're across of that our talked segmentation taking that The call that not on

his in Moore book I also number a team know improving So our large and commercial Tucker of that mill of initiatives drivers performance. and are have

but So, I a the lot what some drivers pricing core very in describe, is trends. of are, those addition happening positive of underwriting, in would to

Chris Swift

add would picks, comment. thoughtful, related with business. nothing like we'd of how be with predictable, I in just to consistent our There's philosophy that's to our 's to Tracy changed loss fundamentally anything

great a I deal of mean, we have Tracy, consistent pride So in predictable. being and very

add. color would Yeah. So that's I only the

Doug Elliot

which it with was closure, how different one addition of weeks you we've years Day, inside give there ago. day Chris the to take is and today initiatives things I to highlight on a of to on two Investor some we're of five is would in more a the sense that And are able And with and the than when just of things we've do as that, Specialty there on agree maybe engine will we together been organically, competing you a lot of XXth. product done side. our the are that

to our in spend attempt a forward. going know look of it's time our go optimism is, back, strong hard, is some you we to you it Company folks. to why I quarter-to-quarter with and give going the sense So as XXth with We're as

Tracy M

XXXX? follow want year also in next you will front that or Looking the in those rate with sense point forward earn auto up of higher to we Investor I seeing on those efforts in that XXXX get inflection guess see Day. to pricing journey loss when just a efforts. Would I in be filing, trend better needing think rate will I comments.

Doug Elliot

that Is a or Thanks. [Indiscernible]. well, lines personal commercial Tracy comment?

Tracy M

long there's they just regulator and thinking ago rebate. some about delay through I those with wasn't a filings But it audit. getting since Personal that actually understand were

loss the accumulation you meantime, process the improved Just have trend. and of that getting rate of in filings just

to So think that I will wanted know when come you together. just all

Doug Elliot

Yeah.

So predict, but we start ago. to be me with XX were going the just let executive date hard to months is where

we not pricing of new did to things second XXXX. quarter our the One with the of business in tinker do, was

we not to kind forward. going based money customers, So and our rate did when change a did we in-force pricing return appetite return on an of our new that of or

I is driving changed obviously, because the in think healthy remains profitable quarter appropriately stable, not our XXXX, we that book radically changing about with of that premise But provided more habits it. intact a I'd return feeling second given of is but we money has and much that base that. start very the

as some right? that answer supply, about And is is question, make we to that and difficult Kingston predict suggested, of to feeling, the do, pressures I'd So we point the dynamic. we're have talk chain think Second the you'd the to dynamic, get will that I labor all very supply those And continue they 'XX. in feeding ongoing will unemployment, middle an to of state-by-state the but that part we trends then is lastly, into is hope are really component. into ease a this. 'XX, think We dynamics. etc.

we XX states look X we filed that for me So another suggest, in or we days filing the it's states, last have months. so days in across XXX that the states to we're hard next some won't filing our X, for some be

'XX, So a of a as kind of live we better and into think in active do move that bit, short-term, as spot. half to we get a current will very don't happen we we them it the think the will expect we but and chain is on through conditions latter we'll the see ease to so process supply

Tracy M

Thank you. I it. appreciate

Operator

go from next question Our with Suisse. ahead. Please come will Credit Kligerman Andrew

Andrew Kligerman

how great Are some preclude Could authorization that repurchase the the are might What of X also where the M&A authorization? over and Question to seeing see morning. upward any like you to first well, -- environment. get you'd M&A this up, bigger? eventually but around opportunities, curious that thinking areas next you years? about with go out Good any play

Chris Swift

been think to just that thanks and We've grow it's the think portfolio that, the Andrew, from at principally opposed robust organically an focus capabilities, mature on of a of -- low for mindset consistent organic products, want we is as activities late -- Yeah. pretty because more to I our priority, and question. I M&A.

'XX it’s shared we So through and make just repurchase that's and you priority, why, consistently I a commitment with a to just low inappropriate others $XXX of with again, where end the million feel that increase.

Andrew Kligerman

benefits Looks It seen are you've And a just we solid up. and moving real that seems nice quarter. business. to X% of really to the to could Chris. you just just Thanks, and out Benefits these on COVID the then moving third had movement ratios? like sustain steadily Group it's driving underlying of get in ongoing see in continue very over voluntary products rate if premiums What the because can compelling products you growth be growth that

Doug Elliot

believe the COVID. I year I can, demonstrated been Andrew. we that think as during from we have consistently We've recovering

in that's come occurring more most opportunity, a employment, or So particularly I as into part-time inflation the think employment people industries. with full-time little wage back

say very that broadly well to for up I and healthy. I was trying think commentary environment sets Group Benefits my as defined the in is that

is line five product growing the product last set highest voluntary our Our that over built we've years.

hospital all SAP with our pleased the products disposal that at really now. we are have we So illness critical

a last is then one point, would just And growth you give deep So Andrew. I that area.

I employees attitudes, attitude think has to changed. people's meaning benefits

we're given through. living think more it, on they're I what focused

I for themselves they're they or protection risk and families. need about thinking about thoughtful their more think

I a products and of benefit type voluntary broad awakening across So America. products there's is think occurring that

Andrew Kligerman

you. Thank Excellent.

Operator

Our come from will with JP ahead. Bhullar question go Please Jimmy next Morgan.

Jimmy Bhullar

is from because that comment last comp. I XXXX? pricing Everyone's things behavior the both point And hasn't on turn next of first questions actually the I comp competitor And on you confidence if or gives yet. couple year might and up had happened a workers to go could in but of pushback the prices state? workers on you the years, is couple what wondering think and expecting that been for because some it of at

Doug Elliot

that by I'd pretty so performance be place to overall solid. that the would And saying start. Jimmy, my start is line

have entering a COVID period. its Secondly, you experience now year three-year most its into way dates

becoming time rates year very has actually people year XX actually of favorable. home XX of period where part is a were frequency experience period to now and relative frequency the So were and

we the comp, the to is on So year about going headwinds think entry we're why experience later see those we're period, the I'm and about sure market but have our now for it, strong. downward risk underwriting 'XX, 'XX others where into be here right to that feel and that talked pricing. with have going throughout pressure workers that labors why the will continues to it's be And 'XX. in thoughtful and taking working end is make that toward so I we some we're to in of performance just into our the That pleased

Andrew Kligerman

think workers when And comp, Okay. is have hard. pretty about past, economy then cases been and as there in I running you margins the think the

You up pick losses. and see a

if Sometimes it on you're time economy, what the as But respect in whether doesn't happened concern seem overall. and a that you this seen like around. could you've that's looking that's at comment

Doug Elliot

you'll are on workers watching compensation. and to have that carefully the obviously injuries frequency in or the because that you driver described, a certainly a job sometimes just worker's lead in you watching economy, less as We're see injuries may when pickup experienced

healthy quarter is fairly reflected if that right will we shape, in that deal share for So with now, quarter in and and the us. our we frequencies And I but see But it something a both are will, as you we are second watch item third high quiet. numbers. in with

Andrew Kligerman

on be initially. you affects more think case mortality more whether more affected trend younger an on given are a so non group or of obviously COVID you was could the which your anomaly could that book high, the And that that's business, lastly, overall, being talk about just Okay. the people being than

Doug Elliot

the the Jimmy, - very non been quarters. COVID over X bouncy mortality has last

data. don't what given se the see we've I just So seen per a trend in

might the healthcare, seeing normal people annual have been physicals, think their whether it I screenings. days, particularly routine view lack health of COVID, providers there checks is be care and during anecdotal for early the

not We heart cancer second particularly this bit have when causes seem seen, in more quarter, - with But at COVID a so this it's COVID very themselves. say, taking and of that maybe bouncy. mortality, been think beyond indicate with little of effect we're that order death I'll stroke all people elevated that, non to care able point. don't That's it's trend I

Andrew Kligerman

you. Thank Okay.

Operator

Evercore question David Our will from Motemaden with ISI. come Please next go ahead.

David Motemaden

If ask the then in Hi, allowing Good uncertainty question mortality how wondering and COVID mortality deaths [Indiscernible] morning. was It's deaths if the about the would fourth it I also call third think should hard now, I how quarter. total But remain similar break reported thanks. And in the a down Thanks IBNR of little this near puts here. quarter. relate the could XQ, you there? XXX,XXX quarter. does, longer. benefits, for my actual of you about in know in was a adverse taking I high, with, lot takes to that go and or I that as just there's just sensitivity a expect a the of wanted the group to much give it to and predict. guess estimates fact, it we as will stay versus

Chris Swift

answers. and question, your David. important take It's some to you to Tom Happy get

not let history How make in complete the of CDC their a on factor. into Obviously, estimate and both data an just debts of sort mortality sort sort is, a non on - overlaid see approach our to of obviously we it data lag with the analysis area during of context obviously, this trends great we to we've you here. happening, deal studies give me a COVID reported of COVID that incurred and have our quarter. but So COVID

the we quarter. blending the held So all the degree in A I you for one end though, challenged could July. August sort XX% so it on is that's When of month two is fairly share higher confidence the you, that's see that IBNR. and up less of that's still the the a for with At conclusion have we put of the in the July the that of quarter, developed, the future. of have, little and to would our in freshest together, ultimate’s essence you it meaning came was losses this of those incurred in predict quarter with September most

Chris Swift

basis is driving you with severity. that point if compared more referenced you the under this So last really up data if And I to and year. are share look looking that's XX-year-old X-month basis think desks the severity is a you would for, at the other year I point X-month you on our

tells severity experiencing XX%, out the at lives Yeah. of Our which historical insured is most Southeast. look region higher cohorts, there They again, is up value, the regions, expectation active the at us, age When work. in from younger stands side. us sort that of for sort are elevated we

lot business. years there, the model life and data say, difficult in you quarter. It's all with So predicts fourth this. data out share our get really got some there's the a to would Actually it's as most you been there. arms effectively just my of around that a out I

models are high, Some are some low.

first quarter overestimated experienced we where our even You've our year significantly IBNR. were this on seen

from see December a quarter and and frequency wide provide we events up do that going. in some analysts though refrain of to both a on would I going coming outcomes. range mortality we'll have and I'm of is friendly view we fourth our So because share there's severity investors making predictions FD where any What

about 'XX harder You ask, predict. is might XX? even what even to

some when emerge thinking, quota in we think today, give our sit have that you together as two will I but numbers. still back could everyone's So in here effects best lingering we're these next we'll quarters February,

David Motemaden

you're I there you wanted ratios, looks Got loss that just Doug. had a alone the bit Thanks, could obviously, And thought ex-COVID, there you a more very in impact, Could of like, a ask. because about and in sneak actually appreciate commercial, was talked I in just place lot talk Chris. gears I where uncertainty it. that one pressure. to If about drivers switch not It helpful. and improving. totally predicting so. little detail. under underlying That's of terms pricing is for understand more the small I was

So is coming inflation just that benefit something a more or wage else? of through

Doug Elliot

the in quarter, we so. quarter. year-over-year commercial mentioned small pretty a had about think weather good I non-cat quarter, I

ratio pricing small. question good in there to on your our expectations workers comp been in We're around We loss yes have some news slightly then favorable outperforming experience and our has there.

be the in line. good -- that's through where still we our would right off thought calls, the our the now. see third our we So we encouraged But indemnity about that's calls, of quarter. our by Obviously, in books performance in not I against come severity calls. general and what We've the feel

major I a Company. our solid small think by there, just really another don't commercial So but performance story there's it's

David Motemaden

you. Thank

Operator

Spivak question-and-answer This any I turn concludes for like would to conference the closing our session. Susan over remarks. back to

Susan Spivak

you, appreciate Thank this all Matt. us of third the We for review you morning joining the quarter earnings.

right can on to is from our you. XXth, a Conference you And on As website. Investor PM. reminder, Thank our November X:XX Virtual register X:XX

Operator

attending today's now is Thank The concluded. you for presentation. conference

now may You