Hartford Financial Services (HIG) 4 Feb 222021 Q4 Earnings call transcript

Good morning and welcome to the Fourth Quarter 2021 The Hartford Earnings Webcast. [Operator Instructions] I would now like to turn the conference over to Susan Spivak, Senior Vice President, Investor Relations. Please go ahead.

Thank you, Andrew. Good morning and thank you for joining us today for our call and webcast on fourth quarter 2021 earnings. Swift, and site of in Chief for speakers be results on earnings-related order Financial reported of will Web CEO Elliot, our the Chris Officer; we and posted Beth President. the all materials of the Doug Yesterday Hartford; and Costello, Chairman call today

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

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

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

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

realize November, we sustainable for shareholder our in more the benefits are businesses. Hartford execute value as At and to and and in the strong we our morning we Good shared you across roadmap how we us our XXXX, for thank organization in growing strategy, maximizing on consistent delivered of In executing a joining financial demonstrated way. performance our today. Investor The investing continued Day

our top results the Our consistent quartile deliver enable sustaining profitable while same capital leading at generation, targeted performance. to will growth, drive continue ROEs time priorities that produce market and ESG

quarter million profitable up our full value ROE XX.X% $XXX up $X.X consecutive year. core core XXXX to share was the for year core evidence of excluding AOCI Book the earnings drive to ability earnings were from to end and and of year billion. As diluted per grew growth, the fourth XX% second in X% earnings

During sustainable an we return in the capital for returned to also repurchases target common cash are million billion. results to extremely from last dividend, $X.X years of portfolio These quarter, to share attractive strong flow. businesses several total product investments $XXX generate of strong XXXX the and bringing shareholders over

we The and for share along Going businesses resiliency X and sharing to to underwriting continue and investments businesses commitment complement capital forward, will and continue prioritize and future claims, data continuous invest Hartford's the demonstrated allocation analytics, our insights execution. winning expertise, speaks management I the distribution the by proud incredibly our passion risk stakeholders. capabilities to and the and in tools, embrace extremely science, years. of advantages of decisions. across their deep am fully for on Hartford's team, ensure the own focus superior distinct growth, over will exceptional with All each portfolio other possess talent performance. have This our we behaviors organic to of our especially character, improvement, in to last well, all repurchases dividends that digital businesses,

price and continued quarter, double-digit to margins the with our positive strong translates the which increases. turn continued line growth, business levels, momentum commercial in highlights solid business financial from now Let's reflecting strategy In stellar performance. into how top retention higher lines, renewal illustrate new

performance I a segment. our improvement. provides plus to earn of expect platform loss contemporary new lines, progress cost pleased in solid product our in exceed that experience trends Prevail the as market am in and rollout further a XX in strong made more we age pricing margin operating dynamic the the being to advance unique we ahead with AARP resulting customers to most lines to Looking growth XXXX, and continue environment. delivered Personal

inflation We underlying are closely loss ratio and anticipate on We pricing XXXX. in underwriting watching and costs with slightly the impact of actions. higher responding combined

demonstrate prior customers. paid increased the of family to benefits sales for XX% ongoing Persistency from Despite sales leadership medical Adjusting our Fully XXXX, across position. be existing our states. was year. elevated was and to XX a growth January insured ongoing being remain about off group business disability Turning premium several new the solid in on performance sales up one-time in initial growth as with lift, and leave X% claims. good as well to benefits, are expansion and by group over increased reflecting the headwinds, earnings impacted continue pandemic premium pandemic In from key one year. with life metrics start in quarter, market we point prior that with benefited par

of Initial has expecting for an COVID and will to incidents infection For variant challenging book, most assumptions. vary incidence perspectives disability resolution the experiencing, the mortality. surge our death compared makes and of driven widely but as have effects cases endemic as are Estimates highly due lag final recent elevated long-term more disability, is claim and Omicron short-term as XXXX. disability in virus. of cases. between COVID, predict future into been are we it The full expected short-term future do have Omicron year, Within of the rates pricing be remain impactful on the to while growth in recoveries turn to range X% modest in the increases disability long-term shown incorporated premium strong. we signs Claim

losses the between are excess we mortality, short-term estimating impact we first XXXX, including For disability the primarily million expect of pandemic, results effects the and of which in pre-tax million the $XXX broad of $XXX due to to part and year.

remainder data best reflect on less of due to we year. the principally the get based lethal. COVID population the the and boosted can is are This optimism the estimates gather optimism mortality trends continuing Omicron to and for regarding excess Our being our

the to through community, there way virus. available. market am state with their hands expectation make and fewer remains, medical into therapeutics advanced XXXX, a of deaths encouraged Though the the we as contract the pandemic the as options progress uncertainty addition, endemic who regional is an shift I of those for In treatment more will to

core Excluding and outlook any for the consistent X% for pandemic both disability, expect between margin related business. margins be and to life our effects with long-term X% this we earning

be business the the macroeconomic to XXXX. will Turning one environment Hartford which I am optimistic prosper. the in environment for will

remain capacity The growth. we which rate U.S seeing half challenging workforce and first fall of will drive to of to will is increases at X.X% in levels the year. strong, and are to the has consumer pre-pandemic be We of expect that year-end economic XXXX, X.X% inflation to below participation. unemployment we In to fallen signs spend expect likely

consumption, Commercial believe also expanding formation. benefits is across However, compensation to to lines, An growth mid-single-digit Lower core and of group businesses. supportive the X% GDP business in employment chains in gradually services, centric catalyst commercial with inflation goods year a unemployment supply for half Small as is particularly will transitions the our rates of decline rise, improve, from we economy workers' new second and higher interest growth the and range.

in this and to constructed our well earnings and a and XX% favorable ROE generate dynamic. to P&C withstand profitable to in backdrop, capital in high-quality investment into on we core growth, a expanding markets, lead based management, the may normalization policy volatility is portfolio to group monetary margins current diversified With market XX% well-positioned continuing macroeconomic XXXX. our XXXX benefits proactive are While pandemic capital assumptions and

I Before I going want to to and our commitment ESG close, our forward. speak achievements

closing, outcomes formula investments very capabilities, consistently employee sustainable base. made transform our stakeholders. have recognition adjusted from a long-standing to strategy with testament winning financial to returns. work competitors. performance a strong to a alongside named expertise, In ESG remains our in significant setting and core these who and we the and Most creation teams critical recently, of for XXXX results dedication the and our America's our a a component we We begin deliver sustainability and continue and we This receive Most to are. competitive value product one and risk advantages our organization into XXth apart to JUST leadership as consistently overall industry-leading talented have superior one and exceptional make number with the depth our we and was and the expanded to positive us achieve position culture continue dedicated complemented we been strong list. by recognized priorities of Companies on hard insurer is for efforts driven a all of progress Hartford the that underwriting commitment result tools to The breadth digital direct

am an for has the We more continue stakeholders. that all producing even differentiated results. a our become continue competitor, will value I in financial on the while to never objectives confident to been better position investing enhance and deliver for Hartford all to long-term financial

over the turn I'll to call Beth. Now

offset strong quarter of of or Core lines, ratio lines investments, significant of by points Specialty auto Thank In impacts XXXX quarter premium X.X per improvement compensation quarter, combined severity. continued to claims losses lower reported earnings the business, XX.X, Chris. property. a growth. and fourth exposure of effect you, reflects and partially the results Commercial includes increase and in P&C workers' in combined written growth due ratios an the of the of diluted underlying underlying strong retention reflecting the in frequency ratio the from and for the improved XX.X and benefits. the an in from The and Global loss new contribution $X.XX increase group pandemic million $XXX share underwriting COVID Personal XX% and policy

which of grew recoveries aggregate and fourth current business million $XX catastrophe homeowners. million $XX under net cover. our XX% catastrophes P&C of hot both year New premiums before increases auto is accident quarter tax, in in were with reinsurance

reminder, exceed a attaches cat qualifying losses $XXX this cover As million. once

As the adverse by million increase slide January package development it in $XX our cost presentation. auto development. program with we catastrophes, a development In million a at relates with of in our total driven favorable ceded program, and reserve for We've liability, year P&C cover, prior reinsurance accident of the changes net reserves decrease earnings adverse for to modest workers' in compensation, to to XXXX, subject renewed a a the million, we quarter, adverse the $XX program by on was structure. summary was included the only in of reserve business earnings $XXX cover. in no partially X, core development reserve incurred offset Navigators which personal cat

and coverage development of adverse we recognize before $XX $XXX and treaty. million of Outside of for also cumulatively have earnings, under asbestos environmental environmental. $XXX limit million the asbestos the for We ceded with losses $XXX million for million core tax

this During rates a year's than defense in study, claims values. frequency, costs reserve an increase claim in was decline filing asbestos by saw which settlement more we offset and and

reserve the large site legal was a environmental, the defense coal settlement of in remediation costs. ash primarily an due to increase increase remediation For and higher claim, costs legacy

development seated little over the $X To While economically was million deferred took of of income under retroactive limit with the development that on development date, the we charge billion $XXX the have to remaining. million for $XXX adverse reinsurance. to cover reserve adverse we a a gain cover, ceded

again decline will slightly, in be XXX,XXX down as short higher CDC third Unfortunately, lived XX quarter those of The XXXX. currently U.S the core ticked quarter of When the in excess XXXX. and benefits. elevated death core from group $XX had to about The still reported for for long-term we third rate million December. was U.S higher $XX XXX,XXX, disability estimate earnings up continued compared the fourth death quarter core losses we surge. group deaths first to COVID decline The quarter reflects age increasing life, August higher Using expense million deaths ratio. fourth loss the incidents in the loss shared deaths, the death but COVID mortality than under to for Turning our rate short-term just and slightly the started results, claim of rate reported than quarter. is

our loss all-cause prior for before X.X levels the is of quarter, in million mortality long-term estimates ratio XXXX tax, to incidents claim quarters. year quarter, In The prior on the compared the The $XXX million prior Our million increased fourth dates favorable the due points reflect partially year increases loss $XXX $XXX development quarter. elevated to to and included year disability over offset excess million disability. modest accident higher in quarter for estimate short-term the by both in $XXX was in activity. claim with long-term we disability

to did due disability When elevated decrease and COVID in were in earnings the quarter the mortality we adjusting impacts, for experience related a and in COVID earlier claims we X.X%. disability short-term core Additionally, excess pandemic. claims not margin corresponding non-COVID did the was as short-term

compared costs and to expense the fourth handle expense was group ratio prior by impacted increased costs, an benefits ratio for compensation The in technology higher quarter. to by Lastly, higher X.X claims. points elevated staffing costs increase the

million remain year quarters primarily core $XXX fourth in million the $XX income of on $XX prior fund Total $XXX period, in XX%. December to $XX billion. reduction of prior million core increases of related continue funds. in inflows plan, for savings AUM received of at positive addition, XXXX accounts. $XX AUM incremental lower core cost a increasing We In quarter. transformation expense equity and of year consecutive increase The the the loss savings of impact million and was enterprise, an reflecting compared on loss Mutual on net achieve were savings Max to with expense due for the benefited dividends of doubtful the $XXX a compared higher Hartford earnings corporate daily of a $XXX quarter loss these The million million million. million $XXX execute in level the for offsetting allowance are year-end a operational Xth the to net Hartford our XX net and we through to for the average earned premium growth. Across from to achieving schedule in quarter were Funds Partially the of was investment Hartford effect XXXX. XXXX expense reduction XXXX.

outstanding fourth partnership full total quarter private limited XX%, The million, delivered by excluding the driven yield partnerships quarter, prior to before investments, annualized tax from funds. was X.X% of Turning investment X% limited and up returns year $XXX annualized the our portfolio the another from quarter. very Net benefiting income was equity mostly portfolio strong for year.

and we to before value unrealized as rates $XX.XX with the make-whole December share XXXX maturity down yield expected portfolio interest remains maturities in expect slightly on at XXXX, on XX, within forward than was the rate Looking fixed annualized since higher diluted on $X.X marginally reinvestment be portfolio billion portfolio as the tax per and earnings below and at no to wider average total partnerships, gains in equity as yield non-routine credit $X.X portfolio, XX spreads. returns be credit limited credit as reduction XXXX will The our items was to in to billion with XX.X%. strong low would excluding continues the well and trailing an payments. quality The income from sales December the excluding losses core such ROE XX, September The quarter. due fixed X% maturities the AOCI months XX, lower

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

of As we approximately through million. investments remains $X.X million repurchase XXXX. $XXX common repurchased year-end. for X share company February and of billion shares the holding were December authorization for X, XX, From $X.X January at at X.X Cash billion

million a company in intend year As $XXX issuance, the included to in at of reminder, hybrid to cash end the proceeds securities are XXXX. September the we redeem the the April debt of which holding use from

and $XXX approximately received quarter, billion the million $X.X XXXX. from and During we subsidiaries $X.X fourth in between expect billion dividends in

largely we to from forward at Looking Day. shared for the those views outlook financial our XXXX, Investor are unchanged

excess XX% updating progress. capital the provides with ROE path uncertainty look for We to group benefits, plans management to XXXX. both over in We XX% This profitable our our to growth and level expect on some with call the P&C subject to forward into you of XXXX turn to to coupled a mortality. I'll generate and Doug. now

businesses. drivers five and outstanding. the good impressive an We Casualty Beth, of substantial expanded launch technology of the Property and our data and and XXXX market straight top our each in in growth through the commercial progress you, to Small critical Thank year driving processing and and five, the Commercial, financial line Hartford's product the of Prevail. were on strategy was lines' our new middle improvements are during Across commercial product and Investor everyone. results business. is our Day, morning, outlined speed personal Advancements each across achieved simply as for breadth fueling large

execution. on Our distribution multiple with expanded marketplace customer distinguishing footprint our changing customer is stronger ever to Hartford strong than is capabilities focus across meet The channels. needs experience

Small rated Net Our of was the have in tier us in national digital Keynova improved significantly in middle by commercial, number Promoter experience top the large one Commercial and putting Scores carriers. industry and

our engine of was combination drivers $X The ratio and differentiator. of lower full The delivered ratio these powers earnings were talent underlying X% three earnings and premium to written than core and Casualty higher. XX% growth XXXX combined Finally, of Property a underlying and be has XX.X core XXXX continues of and critical points year billion. combined

of with the consecutive underlying improvement. in strong line top marketplace growth margin momentum is evident quarters Our several and

driven impact Let of and quarter. me and premium with performance top year-over-year business even Small growing Small -- versus given premium driven payrolls year, year the XX%. enforced and new was record line points increased Commercial The $XXX of growth the written policies business from strong new year the points rising pricing, by contributed our before result. a our of an than $XXX was dive expense improving quarter about fourth The Policy retention program. XXXX. underwriting line the with of year, closed and each million with X% year X quarter, X.X line underwriting was and continuing year's The result outstanding Commercial quarter COVID. of up of underlying both a during X.X% to billion, improving consistent the for was pricing bit primarily comments in leadership prior XX% throughout closing business year. line grew performance XX%. excellent Fourth growth [ph] continued exceptional, improvement lower of earned was the points stronger written also Hartford execution XX% last XXXX. at economic in the an Commercial top the economy, market was Next quarter's X%, million XX%. deeper and for the results rebound count including margin an the benefit by combined X.X commercial ex increase ratio quarter several XX.X $X prior eclipsing lines into Fourth

XX% for product contributions from our reflecting XXXX, the a New written market our verticals. premium In channels both core industries product general written well BOP with new market spectrum as middle have $XXX year large of rates premium fourth specialized strong the and quarter. as significant momentum, growth from in and the increased growing execution. distribution year Middle suite was significant our underwriting points improving commercial, X across over improved increased XX% for and all XX% the Quote traction. hit million year and for business continues our leading book to deeper

written XX% We leveraging drive balance rate profitable the annual disciplined to produced quarter. strong Specialty the Global continue and to year while in with segmentation XX% and underwriting premium tools growth retention a at trade-off, and risk our growth. maintaining

be mid-XXs. had strong with New impressive, of retention our Global financial of excellent year the led wholesale for in year lines U.S throughout and premium and year business XX%. premium to $XXX XX% or growth of The breadth also continued million remained written by of policy written growth was an growth REIT environmental. the the equally

largely exceed and U.S with most the international quite workers' written X.X lines to loss Global standard ex remained was with marine loss continues achieved remain in compensation trends. metrics coming XX.X. at the loss comp trend pricing in commercial in across the two strong. line for prior in trends X.X%. market, in in middle with the Ex move quarter, and quarters XX.X% ratios products. was ocean the year were pricing expectations. sequentially U.S pricing Specialty, workers' Across and at pricing quarter and was commercial X%. In line comp pricing Within pricing Let's wholesale XX.X X%. consistent to loss at renewal also U.S lines, portfolio good Fourth gains quarter of still pricing

in Loss losses. the X.X in reduction fourth quarter for year current lower loss ex-cat Ex for ratio points driven in a increasing by Auto loss points over expectations. XX the large to ratio this favorable was For frequency, underlying book. quarter personal traveled. partially and Shifting by few results to year ratio our quarter the of a of for COVID, property to benefiting points losses trips with the year XXX the run basis X.X across year stronger ratio impacted points the and fourth to favorable improvement by lines, part improved points, property basis continued combined the XX.X. X.X improvement were quarter. offset the ex increased year for from pricing COVID Liability miles and vehicle the frequency

physical cost a severity home, worse. bit better our parts. and elevated, the and on However, was full wages than quarter pressures supply remains chain frequency fourth year cars expectations. In frequency and by primarily used Auto ran of damage rising driven

X% underlying and Written for and However, and declined higher building quarter. the labor ratio both elevated X premiums from the costs the drove the year fourth points the for loss claims fourth over year up severity material quarter.

as the our in in XXXX. see and now However, And improved eight J.D. signs steady product positive half available included our XXXX. am slightly with data. profile rates, by rollout the Power's retention XX in growth expanding improving I the significantly second plus conversion of in new cohort shopping states, reported We rising encouraged for Prevail, with industry is

that on we While a new pleased with quality top is our priority. remain a the in moment. pricing business More of

XXXX combined back to strong Investor this commercial growth an premium continue Day, underlying like XX%, off with significant growth X ratio Susan I'd target of year. XXXX. X% XXXX a few Q&A, Coming and and between for Before with project between to for X% XX.X is X to X. XX. written call a share lines about the we thoughts I turn to Consistent

lines, growth, in to projected commercial combined and and to wholesale We run remain return double competitive, especially X/X Workers' Renewal expected written to compensation pricing slightly costs Across personal supply in with auto pre-pandemic counterbalanced compensation approximately be we projected but pricing In will and commercial of severity. lines workers' building mid-single-digits loss remain certain workers' increasing compensation compensation. flat most historical digits. to expect inflation, written Persistent with frequency Commercial. lines more we U.S exposure to expect earned Renewal is Small is excluding to exceed continue will trajectory. in marine trend XXXX. The modestly expense. chain 'XX to underlying to in ocean below Specialty wages ratio increase, X/X to the rising such projected throughout material patterns loss Global lines, is as is and pricing in to negative. expect workers' continue pricing labor ratio impact lines, closer except disruptions

loss year property strong personal lines trend, XX. underlying we of with ratio adjusted state XXXX to business expect and Prevail multi-year an our schedule. of for last ramped of have our an All-in, been result In significantly activity validation filings outstanding launch deliberate our a over this of we've regulatory a combined home the and and to the To was filing casualty and XX I closing, current view price days. auto throughout of year. half most ensure the these trends, up initial XX reflect our elevated points continue XXXX our first roadmap. As expect thoughtful

a with clip. buoyed the Our driving delivered early encouraging Strong pricing loss features and our launch improving of economy well the earned commercial and seamless demonstrate success in by contemporary cloud performance, lines commercial portfolio, book results and the improved have marketplace. personal execution at into signs will in current compete design that double-digit product driven grew from platforms year The business the Prevail strong of accident lower commercial and business into analytics, accident year each integration distribution decade. talent product the ratios, next our lines our technology

with all I'm our The strong performance. XXXX Investor on as our are expressed call. As I XXXX updating pleased to Day, quarter our sustainable with results look our I future. November is at you performance first our and forward extremely

the turn me Let now call Susan. to back

questions. to Andrew, we're ready take

Andrew first question comes Instructions] The from Suisse. go Please [Operator with Kligerman ahead. Credit

a thanks Hey, lot.

look came program. like out the the midst a just you're at it XXX.X. Prevail personal auto in And So, area, taking ratio you of of rolling lines combined deeper at the looks an in

wondering how get do think you where it that long ratio get range in rate to attractive a those And increases I'm in be? you place. takes and of kind could an So, to might when loss

questions a So, different few inside.

Let and answer them. me can if see I uncouple

than it First our I quarter X point loss consistent that want quarter our fourth that, the to and I'd higher our also year. and perspective, from a performance seasonal the for is make planning is highest history our ratio XXXX, in X number note And year. runs with year on just in to points average per

quarter. fourth the inside is that So

eight said, more end to I in of out we my be in XXXX, have than we By remarks, states. states. rolled as expect Secondly, the XX

around chain. delayed rollout, on aggressive a supply we have states although an a So, based rework few

now are from We a actively working right states filing XX perspective.

supplement we time. last in steady of you've the I pricing seen years, relatively the period over that progress our over think reported couple

rate chain relatively supply and ago our as we're X Andrew, was that That small. need So, months we've basis. has on watched reacting changed a to weekly

with XXXX, in So our we demonstrated second to over work our through expect in pricing by results the our the quarter largely by the see supplement. X aggressive next as you'll as quarter And that approach in we're we and month, to written aggressive week, what be filings way doing will continue through happening effort. first the months

Thanks for that. I mean, it sounds like in you're very trajectory. confident

general, business as necessary the And long that a fit is property, as casualty in business, in a think is fitting -- personal with you see about feel be to do in core As over the that I lines fit? you a haul? that

business. a it we AARP like the it's see improved our for Chris. as Obviously, it relationship Andrew, contractual over the XX yes, would years. years, we've fit. Yes, I say, We with and extended

primarily great meaning two think and of business THE it AARP an affinity I direct with HARTFORD. brands, So, marketing is

digital before given our contractual I in with emphasis, of do So the happen able really particularly something here product, platform, make can been hadn't we some to the we just the modernized that think arrangements.

preferred I and we operations, unusual good components. profile carriers it's personal got we So, our and and in it overall and earnings a not there, contributes brand and it's to think overall segment that lines we hourly a think like, have commercial our for line

question go The Benguigui comes from Please next Barclays. Tracy with ahead.

Thank talking what about. a you morning. Good on be were quick This you. may follow-up just

wondering correct last to XXXX, XXXX changes. as have now believe the You around? you may how I'm any policies to this go agile. more pricing mentioned the not policies? that been agile you some would structural auto because may in I'm X-month contract I time you be to versus other industry had changes there I playbook now more wondering, And XX-month were guess, Or on have back make able change

Tracy, guess things, I point would I a few out.

right. You're

Our Prevail product auto. is a X-month product for

how dynamics the There's now lifetime product changes the across the not new that and a around is the feature flexibility country. going that So also manage product with we'll old forward, the product, that. of essentially our speed in of the continuation

of have product we So, get 'XX rolled the a and to more across But excited have results. out us we approach, work about yes, nimble much lot of country. think in a the front we it a early in contemporary

Okay, great.

that's clear, to Prevail not just be So and AARP? just in in

product the is correct. new That months is Prevail, is X

Yes.

it. Got … looks It like Okay.

Tracy, just … one

Yes.

Tracy, it's Chris.

and existing is to our then business in having policy, force that all and even only emphasis. new of agreement. in obviously not Prevail about thinking a lifetime continuity do, the Just work have existing XX-month but we one is book Doug, point our

so writing ability -- the non-Prevail we we're So, the with the even business product. over in last XX new or AARP have months months, XX

continuity with agreements. business new writing not lifetime are We

the of lifetime continuity. in-force vast but So, obviously still has majority the

a just So one nuance. little just

wondering year-end. to that manage P&C expect XXXX in the important X.X continue? duration I'm years Is in from something you capital? just years to for of back at jumping it the Okay. shifting assets way happen September That's X And and at gears, really But noticed the noticed Maybe may shortening time helpful. AOCI Thank Harford rates. I in. during loss higher also the you're interest like you I could AOCI XXXX is how we now same that given looks

I'll Tracy, take Yes, that.

is did significant change as a the in views refer our to interest the just what As liabilities. of just what's some given of change we But surplus happening in with duration the rates. assets duration also to of shorten related our we that

fourth we the all on longer total. some the positioning significant I at But anything of look wouldn't but change, would again, the the We of some in just in again it's made So, portfolio. I say quarter of did we've AOCI our way that end, that characterize that in where significant. the changes do sales not a but

Fargo. Wells with Greenspan Elyse from go ahead. comes question Please next The

Thanks. for Good And of subs point year, outlook billion $X.X on it first $X.X Do your to more that in bought side. of also 'XX for the out is My you 'XX? that than from capital 'XX? I billion laid and then you would morning. over given it with billion. you the dividends question the probably the seems back like $X.X coming kind That’s you mean, finance could ahead

how And timing plan? of return capital the the XXXX the getting that? shares think to perhaps upside about some and should we there exceeding that is So,

Elyse, rest forward. I and with year we're the can to actions believe what what But into going management and to the to over of to her it's premature speculate going do equally start to our pleased do the we commentary. Beth last continue years then 'XX. for Yes, right now going start capital are add and we we're would

we all finish always opportunities. comment existing now I want capital out, are allocate. just year to clear the parameters see communicate with funding you when been time. think additional to would our have over make views we think how change that about period our you But plays we're our And program. you. right excess those falls the we've Beth that S&P, Obviously, with just We'll and of what might out. a see then longer internal we upon where But sure growth add? But

I that. we price. at originally make for bit the thing periods, than only plans on I I And us total over we for additional had mean, add, planned. a to share would Elyse, 'XX with movements amount The execute do just react pleased typically we the us more not to share as executing to maybe flexibility ratably XXXX. look our we're look program management in it as capital we're you said, and in price what know, agnostic the of very repurchase our authorization but billion acceleration our provide does And of to really plans that is did were an attractive Chris when $X

Thanks. And on follow-up trend then loss is my on commercial within line.

loss margin your how you trend? to loss you So, the guidance? the make would when what's trend underlying guys What do see for environment, right, expect you XXXX when in continue to pricing -- within guide and exceed embedded your set also there comment, and 'XX, you

building 'XX. I largely the talked tweak are then bit, and favorable. of last pretty on we of tweaks. is as with about loss bumped where 'XX Comp we're vis-a-vis up trend digits consistent chain frequency been years, one little excess has to middle cetera. picks a that two We've supply mid-single-digits couple guess severity and and we trend up the frequency medical is, Elyse, construction in made severity. well. certainly aware watch and focused both chain We've was its higher over heading, and One consistent I have that continue say supply to property, The would trend et

single remain digits is excess in the area and been for casualty where So 'XX. we've there an high

Raymond next The comes go James. with from Please question Greg Peters ahead.

Slide investor to at of pieces where looking to I'm reiterated morning, you X% growth context favorably just cost rate. the continuing relates X% to of cheap be from looks -- positive the back targeted low sitting seats fruit, to And hanging of favorable your outlook 'XX, we're continues to looking XX, the as going you the X the what I'm price And lines guess everyone. rate I to my first is like trying in the Good at commercial it is, going looks do of 'XX for especially Slide trends. the in that on growth question strong be loss -- over for focus results trend show here, is environment here that a to we're deck.

maybe give could you I So, color on some additional that. thought

three I'd try, start let me businesses. big so commercial, Yes, across Greg. with our

from we've primarily behind exposure there's audits area. little right, the and been tailwind bit in through comp coming premium As mentioned, economic growth, of a workers' this

see in-force at in share it an policies about change for customer it So exposure that or gives as roughly right? in and even quite we in bit seen tailwind line business. other with tailwind, is a you 'XX plus had than example, market exposure way to is that rest and which varies sense the more Same X.X, historically. of prior running the 'XX the Small from new Commercial, we So, relative when certainly went by fair that count is middle what bouncing The when elevated would our up. up XX% XX% at a up But a there's the growth, exposure XXXX. in from of coming thing back you amount small that minus, of think teens, PIF XXXX I is when business [ph] look we PIF you over say supplement. of range, we over

have good rates, of change we a strong. at those to I we rate still some when hold our some expect that growth percentage to PIF expect you numbers a strong run to That out, a mid-single-digit to run exposure of a look growth suggest these pricing be see help to bit little? grow. more And when Yes, growth quite we down growth XX% slow that XXXX. And rate. will to a that's So, now. get that I'd you type of driven XX% by abnormal like But think continue we yes, you in

yes, It's -- Yes, makes it -- that sense. does. I

on to you. to due economic business, outside parse out, if rebound is a little rest out figure the sitting us that hard versus sense makes of what the to the trying Just ordinary for to

compare, right. also The would Greg you other last have is share, point I to do a

'XX because XXXX. We second an year, against in months the through had year. what as in happened quarter new was we period. for terrific of expected a our 'XX easier wrote ago Essentially, we performance of a for business So, much the XX.X-month of X terms compare had compare this as

of because the become all will compare 'XX So now more had success a in we 'XX. of sudden, challenging the just

That Yes. sense. makes

a time of to that But also you are growth, We focused make I competitors, to right? lot our grow too. good mean, know Greg, great a on environment. since no a given the grow, mistake. we it's time think it's

still discipline want there to at to using all but and tools that We and we have them be have. sophisticated costs. side, underwriting teams So, is to orientated not it's risk the taking our want growth we a all the growth still on

That makes sense.

it XX, is LPs? using I number is, your isn't the and result. sort the returns an particular from phenomenon. sustainable of Slide this -- getting expected long-term 'XX a at But you, the be we have and beyond? had, that's industry been LPs seem The other return question contribution necessarily normalized outstanding, on that in 'XX as like to in it's that what from this And And doesn't think we I'm guess what's is the about should I

either estate from realization to have right. I'm two real at a private color. of the some been I across addition investments going to you it, to Beth just side, years mean, her returns, equity our cash superior or in homeruns of look enjoyed mark But ask you're a our market we've board capability. want add however, side Greg, to to

add? rate right. you at same what and, That So, the continue can't would you're Beth,

with Obviously, underlying gains the sales in actual we us. sort I would XX% this to over the so year. long-term, think fund. a deliver asset Yes, asset about as and think can it's class very Chris to as how we the what were about add portion asset our the we range, class think X% results about forth had had of we this return that And of of and indicated, we in significant pleased what realizations is, the more the

in to all of kind about all, but great I'd X% So, think performance, XX%.

Thank for the answers. you it. Got

next Please comes The go ahead. with question from Zaremski Wolfe Mike Research.

reserve Global morning. Any on Specialty. given Good exhausted? is especially believe Maybe first Navigators, developments, question on now the driving I ADC from that what's the Hey, great. color cover

the Yes, just ADC, put Mike, it why into share place. you I with the context would we on

really was opportunity add the to to Navigators it First, the capabilities. our and strategic acquire old

great I think doing the in and we've a wonderful marketplace. team, us, up aligned picked culturally with things really

is we've and for balance financing running business. their improve, leadership where $X.X you I positions forward at going team sheet that total the some billion, fingerprints book sheet. a And had hard is they see now, with right place, all we future. was are on could thought back we today. the fingerprint are But Our overall about the their our put Global it particularly at supplement in our the it. in cash balance way we ADC, strong I'm look the When completely to put and Specialty in it's Specialty Global would where on profitability pleased worked have today, say really over to Doug we because Global different. Specialty I and that balance issues think right And reserve it. the really given are ADC, sheets is needed I we using But we decision. Obviously, It's knew

what that's I would Beth, add? say. So would you what

a it life was some Yes, I primarily activity in sheet. little on comments loss that on saw emergence. the balance overall large just the in agree lines specific And to quarter, this really sciences and higher-than-expected and the a bit it as relates we to reaction financial

picks experiencing looked into went consideration. to took were that So, and what all year-end at make we as we our

I just overall pick on was clear asking. I very want didn't Follow-up, I personal just on to it didn't recurring, -- And Yes. mean great. lines. to healthy. been know reserve worth it's so it. be I Okay, like development felt was

have in auto Your results others deteriorated. many take

to number auto. think so us And you and the the just should outlook of initiatives, gave loss taking a we about you're in that as improve ratio

cadence, be thinking kind In improvement? loaded should of year terms of terms the of of in more we the it's half second

in, year. goes the half of written be as second earning So heavier pricing we'll that our element obviously,

will leaned Our the deem appropriate. have although And loss we spread be we think trend as I frequency on just severity throughout mentioned, we into slightly, as though, supply picks, the year chain up are side.

ratio of this performance loss -- are of which reasonable year, selections these that I severity we business next versus made combination increased So the both we I trends assumption. expectations of and our see, part on the top overall you experienced for all inside as plan. a can our at 'XX, is we 'XX are years think year our that that look think And

I'd I add is quarter right a one to auto high thing about to this think just the quarter I is And on seasonality us always it get mind trend, perspective. to just think a just and keep when Doug the as that to the 'XX, look we we expect before, as fourth I'll think the to I know, you feel from bit Yes, from in there, that look the if half point half to at of of because a chain, year in elevated in really supply first XXXX, of first in latter from started the a increases the to compared year see part supply relates commented little chain perspective, compare XXXX helpful. the into things that's book that we in for as

you don't loss component auto, other when thought, inside think personal lines that liability. piece cost costs significant a of I Mike, maybe at one but is it's well-known, auto too. look loss

is chain to its be underestimated, has and liability impacting, us. liability differently been performing than not supply damn for So,

XXX% But wood. not loss that costs. through still to top knock damage damage, we of and physical We chain physical is the and watch have is of on perform So, on supply more XXXX. sitting have to

It's Thank helpful. you.

with comes Partners. Ransom Gary Please Dowling The question next from & go ahead.

I you the of the any how distortions in the whether and that where is just year? I -- your morning. to final we've in the lines my ups picks have Good trends for -- you casualty there might loss incorporated lines, 'XX. into wanted back the doing had, that mind of commercial segments were Yes, or ask at were end whether true meaningful any And

talked years, was a on that to about think to for unless so close relative those those all that some in quarter, off back into out activity. minuses, then that mean, multiple I years. had I prior big as real Gary, of quiet trend net the as raising would we selections very book, I pluses the favorable always we've there's lines about come time lines, 'XX year. and pretty the on our when all you say loss do we accident year we XXXX start, leaned had reason, the every and planning Gary, looking trend know, And we accident some don't we And a casualty generally Navigator.

feel about really our I So, solid sheet. balance

I we the some exception 'XX We work COVID in basically think expectations of chain. pressures from the line assess of we it. supply with at performed And saw hard and with it.

Commercial into there was up Is underlying a anything read comparison was bit? that that the I should -- little year-over-year Small

right? Commercial and read really What We over all year, growth want good Small into So XX question. in fourth XX% on that about our and I that adequacies. Love is the rate quarter business in to cylinders. is hitting XX% feel you

the of exact think all we Small strong to. inside years are lines last spot Gary, over We the Commercial. X spectrum rollout hit product new across, the street the And just I our intended it the

time And very So, that, At Commercial strong bullish. point in growth a we you I no, Small and like felt have would it such not right that product hard anything change into look it the the I'm to profitability. performance. We some back on 'XX leaned do sure was was right mix. I

or from a you've When within and is story had behind package a I the Fair one that's understand and I lot favorable enough. in. we had of development, at And if I where sneak that Is more workers' comp line other all that? any very but cat, the think could I driving look one package favorable that consistent pattern that there development. particular

frequency actual nothing performed has point we've really severity point the in how I we mean, Gary. and again, specific pleased evaluate anything wouldn't perspective, over I I’ve that line would made both on I with time, that. experience adjustments No, been specific, as [indiscernible] some but the to.

very Thank Great. you much.

with go comes question Shanker Please next from ahead. Josh The America. of Bank

more ADC. discussion One when buying seem that it with a of on created in thank feel the was $XXX remember lot. you that of mean, difference $XXX that wasn't about I maybe amount money. And million but of million question materially the $XXX the [indiscernible] protection having million back a I'm is protection, Yes, you. I I between and wrong, like significant

are, we've it. So, it we through made sense and blown here

very PIF that in comfort it had your a some degree are Has financials me taking fence you rate those charges. have that core close they that picks? you're to ultimately ring about sort of you the where seasoned probably confident Because will gave the Or earnings? some book your conservatism could of ADC, lie? that the to your Given now in protection ADC to the did there be

you the -- of say, of it's Yes, got about is, there, would Josh. say veins put I now. years, sheet a as tried I where balance What is new different to in for fingerprints good feel business. thinking over last including the we X.X We lot it our

the positioned it we what got that's we way it. would want I And say. So,

mean, I curious going this if, can guess don't ways. there. I it both I'm leave go it on I get I'm more just And, issue. we'll to think look, out

that. I'll So, it at leave

underwriting are of higher this your average On business rounds a the of that a changes -- in some even customers the than personal it. customers rate argument rewriting lot the any for compared look to peers? lines, and time a been industry? been should long They've you there you Is you you've rewriting your persistency at the in point And with revisions. have of prices higher face through stickier

with strong a our our customer we think base AARP. in and I product that have association believes

And are me, believe to So, strategy terms they a all one strong. and in that great Prevail. priorities, is pricing our super consistency of product going design are excited behaviors with about we're product. general, we retentions expect those the I and hallmarks I'm work to the And contemporary in retention I be To of advancement and as see through the of time. of

investment, so of needed time that, and felt right a was get we But to the big not was completely to we same, that the product Josh, this degree It's like lot stickiness our So, rebuild a do been for we but of refresh stay felt us work. stronger. that. only

will I over think it time.

Thank you.

other for back over I is the to turn time Spivak of And it like the for any unless closing the past any would top Susan I remarks. questions, see conference to hour. there's

get us joining happy your did If all my Thank out we not Have be to reach Andrew, today. office please day. thank follow-up. you, a and we to will good you to for take question, and

for today's concluded. The conference now you attending Thank presentations. has

now may You disconnect.