The Hartford Insurance Group, Inc.

Good day, and welcome to the Hartford Financial Services Group, Inc. Third Quarter Financial Results Conference Call and Webcast. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on a touch-tone phone. To withdraw your question, please press star, then two. Please note, this event is being recorded. I would now like to turn the conference cover to Susan Spivak of Investor Relations. The floor is yours, ma'am.

Thank you, and good morning, and thank you for joining us today for our call and webcast on third quarter 2019 earnings. We reported our results yesterday afternoon and posted all the earnings-related materials including the 10Q on our website. For the call today, our speakers are Chris Swift, Chairman and CEO of the Hartford, Doug Elliott, President, and Beth Costello, Chief Financial Officer. Following their prepared remarks, we will have a Q&A period. Just a final few comments before Chris begins. Today's call includes forward-looking statements as defined under the Private Securities Litigation Reform Act of 1995. These statements are not guarantees of future performance, and actual results could be materially different. We do not assume any obligation to update information or forward-looking statements provided on this call. Investors should also consider the risks and uncertainties that could cause actual results to differ from these statements. A detailed description of those risks and uncertainties can be found in our SEC filings. Our commentary today includes non-GAAP financial measures. Explanations and reconciliations of these measures to the comparable GAAP measure are included in our SEC filings, as well as in the news release and financial supplements. Finally, please note that no portion of this conference call may be reproduced or rebroadcast in any form without the Hartford's prior written consent. replays of this webcast, and an official transcript will be available on the Hartford's website for one year. I'll now turn the call over to Chris.

Good morning, and thank you for joining us today. Hartford had an excellent quarter with strong financial results across all our business lines. Third quarter core earnings rose 31% over prior year to $548 million, or $1.50 per diluted share of with lower catastrophe losses, and continued solid investment results. Our businesses are performing very well. Book value per diluted share excluding AOCI was up 8% to $42.55 from year end. The consolidated 12-month core earnings ROE was 12.3%, an impressive result in the current market environment. The strong execution of our strategy is demonstrated by our consistent operating performance quarter to quarter, delivering on key integration milestones, and continuing to invest in our business to enhance customer experience and efficiency. Doug and Beth will cover results in more detail, but I wanted to touch briefly on a few items. Commercial lines highlights in the third quarter include core earnings of $303 million, up 14% over prior year, solid top-line growth with and without Navigators, and a renewal pricing rate acceleration compared to the first half of the year. When we announced the acquisition of Navigators more than a year ago, an important part of our strategy was to broaden our underwriting and product capabilities as a global specialty player. An added benefit was the expansion of our distribution relationships into the wholesale channel to serve more risk needs of customers. Nearly six months have passed since we've closed the Navigators transaction. The progress to date is on track, and I am very pleased with the collaboration amongst the teams and the positive reception from distribution partners. Our book is benefiting from the strong pricing tailwinds in the market, providing the opportunity to restore certain product lines within global specialty to targeted financial returns. Personal lines core earnings were $87 million, up 85%, benefiting from lower catastrophe losses and favorable prior year development. While up slightly from prior year, the underlying combined ratio of 92.3 for personal lines was a strong result. Our primary focus in this business has been returning to growth, with new business up 34% in the quarter. Overall net favorable reserve development for property and casualty was $47 million in the quarter. There were both favorable and unfavorable development in various lines. Our experienced actuarial and claims teams have demonstrated the ability to identify emerging trends within our data which is used to update our estimates each quarter. Overall, I am confident in our loss reserve estimates. Group benefits delivered another excellent quarter with core earnings of $141 million, up 38%. The increase versus prior year was driven by favorable loss ratio, higher net investment income, and lower amortization of intangibles. This was partially offset by increased investments in technology, claims management, and higher commissions related to our voluntary products. The total loss ratio improved 4.4 points, driven by favorable disability results, partially offset by a deterioration in the life loss ratio. The improvement in the disability continues to come from favorable incidence trends. Results also benefited from updates to our claim recovery assumptions, and the recognition of an experience refund related to New York paid family leave product for accident year 2018. In group life, severity was elevated in the quarter. However, we don't see any consistent trend other than normal volatility. On the top line, fully insured ongoing premiums were just off slightly versus prior year. persistency is running slightly below historical trends as we adjust pricing on targeted segments of the Aetna book. Importantly, earned premium on the Aetna book of business is in line with our deal assumptions and conversions of cases continues to go very well from both a platform and pricing perspective. Overall, we are very pleased with the operational execution and financial performance of group benefits. Before I turn the call over to Doug, I want to make a few comments on the macro environment. The property and casualty industry is facing a number of challenges that have been well documented. Net investment income is under pressure in what is likely a prolonged period of low interest rates affecting new money and overall portfolio yields. The frequency of severe weather-related storms, as well as other catastrophic events such as wildfires, are elevated, pressuring rates to keep up with cat trends. Social inflation related to larger claim settlements continue to put pressure on lost cost trends. However, social inflation is not a new phenomenon. We have been monitoring these trends for years, taking the appropriate actions to ensure our pricing models in underwriting reflect these realities. To conclude, with one quarter left in the year, our experience through the first nine months is generally consistent with the outlook we provided, with no major surprises. The successful integration and execution of our two recent transactions, strong financial results, and capital management demonstrate our strategy is working. It is an exciting time at the Hartford for all our stakeholders. customers, employees, distribution partners, and shareholders. I am confident in our ability to produce consistent results contributing to shareholder value creation. Now I'll turn the call over to Doug.