Hurricanes slashed The Hartford’s 2017 third quarter net income nearly in half compared to the same period a year ago. The property/casualty insurer’s commercial lines and personal lines combined ratios also took a sizable hit, thanks largely to Hurricanes Harvey and Irma.
Still, The Hartford produced a profit – $234 million in net income, or $0.64 per diluted share for Q3, though that’s down from $438 million, or $1.12 per diluted share over the same period in 2016.
The Hartford’s commercial lines and personal lines combined ratios came in for Q3 at 108.6 and 104, respectively, compared to 93.9 and 100.2 in the 2016 third quarter. (Separately, the insurer announced its planned $1.45 billion acquisition of Aetna’s group life and disability business, which should close in early November.)
Christopher Swift, The Hartford’s chairman and CEO, said that the insurer did well despite strong obstacles created by property/casualty catastrophe losses that hit $229 million after-tax, a number largely stemming from hurricane expenses.
“Aside from catastrophes, our results remained strong at each segment, meeting or beating our expectations,” Swift said in prepared remarks. “Investment results also contributed, with excellent returns on limited partnerships, stable portfolio yields and low levels of impairments or credit losses.”
Doug Elliot, The Hartford’s president, said in prepared remarks that the insurer’s margins remain strong in Commercial Lines and Group Benefits, excluding catastrophe results. He added that “profitability initiatives” begun in the Personal Lines division are “gaining traction and improving our bottom line results.” He emphasized, however, that catastrophe losses hurt.
“Based on activity year-to-date, 2017 will likely be the highest catastrophe year that the U.S. property and casualty industry has seen in more than a decade,” he said.
Here are additional highlights of The Hartford’s Q 3 results:
- Commercial lines net earned premiums for Q3 came in at $1.7 billion, versus $1.67 billion in the 2016 third quarter. Net investment income for the division reached $241 billion, versus $239 billion over the same, year-ago period.
- Personal lines net earned premiums were $921 million for the 2017 third quarter, up from $980 million in the 201 third quarter. Net investment income for the division came in at $36 million for the quarter, up slightly from $35 million over the same period last year.
- The Hartford repurchased 6 million common shares for $325 million during the third quarter, and just under 1 million more for $52 million in October.
Source: The Hartford