The Hartford Insurance Group, Inc.

To ask a question at this time, you'll need to press star followed by the number one on your telephone keypad. As a reminder, this conference call is being recorded. I would now like to turn the call over to Susan Spivak, Senior Vice President of Investor Relations. Thank you, please go ahead.

Good morning, and thank you for joining us today for our call and webcast on fourth quarter and 2024 earnings. Yesterday, we reported results and posted all of the earnings-related materials on our website. Now, I'd like to introduce our speaker, To start, we have Chris Swift, Chairman and Chief Executive Officer, followed by Beth Costello, our Chief Financial Officer. After their prepared remarks, we will begin taking your questions. Also with us to assist with your questions are several members of our management team. Just a 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 filing. Our commentary today includes non-GAAP financial measures. Explanations and reconciliations of these measures to the comparable GAAP measures are included in our SEC filings as well as in the news release and financial supplement. 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. Before beginning, I want to take a moment to address the recent wildfires that have devastated the Los Angeles community. Our thoughts are with all those impacted by this tragedy. Our team on the ground is working tirelessly to help our customers rebuild and recover, and I thank them for their dedication. After Beth and I summarize our outstanding fourth quarter and full year results, we will then be joined by our business leaders for a Q&A session, including Mo Tooker, who was appointed president, effective tomorrow, February 1st. Mo will lead all our P&C businesses. and will be responsible for stewarding several enterprise-wide initiatives. Mo is an exceptional leader with a strong reputation for strategic growth, customer-focused solutions, underwriting discipline, and building a cohesive culture. He is ideally suited to step into the president role as we advance our growth and innovation strategy aimed at addressing our customers' changing needs. So let's get started. Our fourth quarter results capped off another outstanding year of financial performance and strategic achievements. These results highlight the strength of our franchise, particularly our exceptional underwriting execution, extensive distribution relationships, and an unparalleled customer experience. I wanted to extend my heartfelt thanks to our dedicated employees. Your unwavering commitment and hard work are the driving force behind our success. Reflecting on some key achievements from 2024 for both the quarter and the year. Top line growth in commercial lines was 6% for the quarter with an underlying combined ratio of 87.1. For the year, growth was 9% and the underlying combined ratio of 87.9 was consistent with prior year. Personal lines achieved 9.3 points of underlying combined ratio improvement in the quarter, including over 10 points in auto. For the year, personal lines delivered an underwriting gain, including an auto underlying loss ratio that was one point better than our expectations. We continue to achieve strong renewal written pricing increases across P&C during the quarter, including notable double-digit increases in commercial and personal auto, commercial property, homeowners, and general liability. Group benefits delivered an impressive core earnings margin of 7.8% for the quarter and 8.2% for the year led by strong life and disability results. And our investment portfolio continues to generate solid performance. All these items contributed to an outstanding core earnings ROE of 16.7% for the year. Let me dive deeper into the performance of each of our businesses. Our commercial lines business achieved significant top line growth while maintaining highly profitable underlying margins. Written premium growth was driven by strong pricing increases across most lines, double digit new business growth in our SME focused business, and exposure growth that continues to benefit from a resilient economy. As expected, underlying margins for the year were consistent with 2023, reflecting our steadfast commitment to disciplined underwriting while sustaining industry-leading performance. Favorable underwriting results in property along with strong renewal written pricing execution across all lines offset industry-wide elevated liability severity. Beth will provide specifics around prior year development in her comments, but I wanted to take a moment to address our general liability reserves. Based on our fourth quarter review, we have strengthened our general liability reserves by $130 million before tax. We believe that we have addressed the most recent trends and have adjusted our ultimate losses accordingly reflecting the potential for increasing settlement costs due to a higher percentage of attorney representation across all claim sizes and the rise in average settlement rates. Moving into each of our commercial lines businesses, small commercial remains the cornerstone of growth and profitability for the Hartford, setting an industry standard that is difficult to replicate in the market. I am very pleased to share that for the sixth consecutive year, Kenovo Group has ranked the Hartford as the number one small commercial carrier in overall digital capabilities and important competitive advantage in this market. Our top ranking reflects our commitment to providing exceptional functionality, ease of use, and unparalleled support and access to our agents and customers. Our financial performance reflects this top ranking, where we achieved a record-breaking written premium of $5.5 billion in 2024, including $1.1 billion of new business, while extending a decade-long trend of annual sub-90 underlying combined ratios. With another year of exceptional results and relentless advancement of our capabilities, I remain incredibly bullish on the outlook for our small commercial business. Our middle and large commercial organization continues to demonstrate strong growth and underlying profitability. We are capitalizing on elevated submission flow and in part by our strategic investments to expand product capabilities and enhance the efficiency of the broker and agent experience. Our investments in middle and large commercial position us well to drive additional top line growth and deliver exceptional results. While fourth quarter new business was slower than previous quarters, full year performance included strong top line growth and an underlying margin that remained below 90. Written premium growth reflects strong renewal rate execution and a 16% increase in middle market new business with robust growth across nearly all product lines led by construction and marine. In 2025, we expect to sustain our track record of delivering meaningful growth with underwriting disciplines. Global specialty had an exceptional year, maintaining excellent underlying margin performance in the low to mid 80s for the past three years. Our competitive position, breadth of products, and solid renewal written pricing drove strong gross written premium growth and record new business. This expansion was fueled by significant contributions from Global Re and our wholesale business. We remain excited about our position in the wholesale market and across global specialty with execution that has never been stronger. The transformational work we have done over the last five years has put us in a strong position to accelerate our market-leading competitive advantage driven by technology, data science, and an experienced workforce. Whether in standard lines or E&S lines, we are gaining market share due to our unique underwriting capabilities and strong distribution relationships. Across commercial lines, our continued emphasis on property expansion generated 16% premium growth this year. We achieved our full-year goal, ending the year with $3 billion in written premium and plan to continue building on this success in 2025. We remain confident that the market conditions support earning strong risk-adjusted returns through disciplined underwriting while maintaining a stable approach to catastrophe risk management. Despite industry-wide elevated catastrophe losses, we are proud that our full-year CAT ratio remained flat with 2023, even with our significant property portfolio expansion. Moving to pricing, in commercial lines, renewal written pricing in the quarter, excluding workers' compensation of 9.7%, was up 40 basis points from the prior quarter. All in, ex-comp renewal written pricing in commercial lines remain comfortably above lost cost trends. Workers' compensation pricing was slightly down sequentially. As we look to 2025 pricing, we are focused on keeping pace with lost cost trends. Across commercial lines, with our diversified and expanding product portfolio and innovative mindset, we are primed to continue to grow market share at highly attractive margins. Turning to personal lines, 2024 was a transformative year, positioning us well for the future. We have positioned the business with new products and capabilities, revamped our operating routines, and equipped ourselves with data and technology resources. We have faced business and environmental challenges with unparalleled determination, And I want to recognize the team's hard work and commitment to our vision and strategy. For 2024 in auto, we achieved significant rate increases across the book, driving an overall auto underlying loss ratio improvement of 7.3 points, over a point better than the high end of our expectations. As a result of the significant written pricing actions that we'll earn into the book, Combined with moderating severity trends, we expect continued underlying combined ratio improvement to reach the mid-90s during 2025. Our homeowners business had an exceptional year, highlighted by an impressive underlying combined ratio for the quarter, the best we've seen in over a decade, and a slightly improved CAT ratio in a year of elevated industry catastrophe losses. Pricing remained strong all year, outpacing underlying loss-cost trends. Substantial investments have significantly improved price-to-risk matching and enhanced underwriting capabilities that are benefiting the homeowner's book more broadly. With our rates and insurance-to-value keeping pace with loss trend, we are confident about our strong position in the market. Turning to group benefits, Our strong core earnings margin in 2024 demonstrates focused execution, a resilient economy, improved mortality trends, and continued strong disability results. Group life mortality trends were favorable, though they are expected to remain above pre-pandemic levels. The full-year disability loss ratio of 68% primarily reflects favorable long-term disability trends offset by pressure in paid family and medical leave products. These leave products are highly utilized and valued by employees, and we are implementing the necessary rate and underwriting actions to improve the margins. Overall, the benefit landscape is evolving with increased awareness of features and benefits, which is positively impacting our supplemental products, such as critical illness, hospital indemnity, and accident. We continue to expect the group benefits market to remain dynamic with digital transformation, product innovation, and increasing customer demands. As a result, we are investing in this business and have a clear roadmap that I am confident will only strengthen our market leadership position. Looking ahead, we expect a modest increase in sales during 2025 and are off to a solid start. Core earnings margins in recent years have exceeded our long-term targets. However, we continue to expect a core earnings margin of 6% to 7% in this business, with disability incidence trends returning to historic levels. Moving to investments, the portfolio continues to support the Hartford's financial and strategic goals, performing well across a range of asset classes and market conditions. Beth will provide more details. In closing, excellent fourth quarter results capped a year of outstanding financial performance, positioning us to sustain consistent and superior results in 2025. I remain incredibly optimistic about our future because 2024 financial results have showcased the effectiveness of our strategy in the value in our ongoing investments. Commercial lines continues to maintain excellent underlying margins while delivering robust top line growth. Group benefits core earnings margin remains outstanding. We have achieved key milestones in our personal lines journey and plan to return auto to targeted profitability by mid 2025. Investment income remains strong supported by attractive yields and a diversified, durable portfolio of assets, and share repurchases and dividends remain our primary capital management tool. As our businesses continue to generate excess capital, we will proactively manage capital resources to further drive shareholder value. All these factors contribute to my excitement and confidence about the future of the Hartford and our ability to extend our track record of delivering industry-leading financial performance. Now, I'll turn the call over to Beth to provide more detailed commentary on the quarter.