Hartford’s Q3 Results Includes Significant Amount of P&C Cat Losses
Hartford reported third quarter 2017 net income of $234 million and core earnings of $222 million, a decrease from $438 million and $413 million, respectively, in third quarter 2016 primarily due to higher current accident year catastrophe losses. Third quarter 2017 current accident year catastrophe losses totaled $352 million, before tax ($229 million, after tax), including losses from Hurricane Harvey of $175 million, before tax, and Hurricane Irma of $157 million, before tax. Third quarter 2016 current accident year catastrophe losses totaled $80 million, before tax ($52 million, after tax).
Third quarter 2017 net income per diluted share was $0.64 and core earnings per diluted share were $0.60, down from $1.12 and $1.06, respectively, in third quarter 2016.
“The Hartford’s third quarter results included a significant amount of property and casualty catastrophe losses , which totaled $229 million, after tax, primarily from hurricanes. Aside from catastrophes, our results remained strong at each segment, meeting or beating our expectations. Investment results also contributed, with excellent returns on limited partnerships, stable portfolio yields and low levels of impairments or credit losses. Reflecting our strong underlying results, for the fifth consecutive year we raised our quarterly common dividend, which will increase by 9% effective with the January 2, 2018 payment” – Hartford’s Chairman and CEO Christopher Swift.
“Based on activity year-to-date, 2017 will likely be the highest catastrophe year that the US property and casualty industry has seen in more than a decade. Our catastrophe losses were largely consistent with the estimate we provided earlier this month, and our claims organization continues to perform at its best, handling multiple events across several states. We believe that our claims organization is one of our competitive advantages, and I am proud of the dedication and quality service that our team is providing to our policyholders. Excluding catastrophe losses, margins remain strong in Commercial Lines and Group Benefits. Personal Lines continues to demonstrate that the multiple profitability initiatives we have launched since late 2015 are gaining traction and improving our bottom line results” – Hartford’s President Doug Elliot.
“We were also pleased to announce our acquisition of Aetna’s group life and disability business, which is expected to close in early November,” continued Swift. “This is a unique opportunity to deploy capital to acquire a substantial benefits business, a market that we know well, and we expect a smooth and timely integration. Our Group Benefits book has excellent margins and a strong market position, and this acquisition further accelerates our strategies for distribution, digital capabilities and claim outcomes.”