The Hartford Slammed by Worsening Auto Losses and Lower Investment Returns

April 29, 2016

TheHartfordLogo from BIZ WIREWorsening auto losses and lower investment returns led to a 31 percent decrease in The Hartford’s 2016 first quarter net income.

The property/casualty insurance giant said it produced $323 million in net income, or $0.79 per diluted share during the quarter. That’s down from $467 million, or $1.08 per diluted share over the same period last year.

Hartford Chairman and CEO Christopher Swift noted gains, such as a 2 percent average in standard commercial renewal written pricing increases, a win in a tough market, but down from a 3 percent increase in the 2015 first quarter. He also acknowledged the declines, which came, in part, from personal loss automobile trends.

“Although homeowners improved, personal automobile loss trends continued to be challenging,” Swift said in prepared remarks.

Renewal written price increases for Q1 2016 averaged 7 percent in automobile and 8 percent in homeowners, and both were about 1 point above the past several quarters, according to the company.

Net realized capital losses reached $96 million during the quarter, compared to net realized capital gains of $2 million in the 2015 first quarter. Execs blamed Q1 2016 net losses on sales of securities and losses on the variable annuity hedge program and other derivatives, thanks to volatile capital market conditions.

Here’s a breakdown of results in The Hartford’s commercial lines and personal lines divisions:

Commercial Lines

Personal Lines

Source: The Hartford