Hartford Financial Services Group Inc. on Thursday reported second-quarter net income of $437 million, down 51% from the same period last year and mostly due to reduced personal lines.
Its core profit was $714 million, down 15% from last year’s second quarter.
Still, according to the results, core commercial lines revenue for the second quarter was $544 million, compared to $560 million in the second quarter of 2021, representing a 3% decline.
Contributing to these figures was a 12% increase in earned premium; an improvement in the underlying loss and loss adjustment expense ratio of 1.0 points to 56.1% in the second quarter of 2022 including significant improvements in global specialty lines; and current casualty year cat losses of $67 million in the second quarter of 2022, compared to $93 million in the second quarter of 2021.
Christopher Swift, chairman and CEO of the Hartford, Conn.-based insurer, said Friday during a webcast with analysts that the steady results in commercial show that “the dynamism of the market is evident, with multiple consecutive quarters of record new business, the speed and accuracy and consistency that we deliver to the market, along with leading digital capabilities.”
“We are transforming our mid and large commercial business into a specialized organization with broad product offerings and deep underwriting skills across industry verticals, driving growth, strong profit margins and more consistent results,” he said.
Property/Casualty premium income increased 10% in the second quarter of 2022, driven by commercial lines premium growth of 14%, reflecting “written rate increases and exposure growth, along with an increase in new business and policy retention and small business.” Beth Costello, the company’s vice president and chief financial officer, said during the webcast.
The commercial lines combined ratio of 87.3 improved 1.6 points from the second quarter of 2021, driven primarily by improvements in global specialty.
As for personal lines, an 81% drop in second-quarter earnings compared to last year’s earnings reflects increased auto loss costs, according to Costello. “We continue to experience inflationary effects on physical car damage. We expected to see some moderation in severity trends and so far that has not been the case.”