The Hartford Financial Services Group, Inc. (NYSE:HIG.WS) Q4 2016 Earnings Conference Call - Final Transcript

Feb 03, 2017 • 09:01 am ET


The Hartford Financial Services Group, Inc. (NYSE:HIG.WS) Q4 2016 Earnings Conference Call - Final Transcript


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Good morning. My name is Lisa, and I will be your conference operator today. At this time, I would like to welcome everyone to The Hartford's Fourth Quarter 2016 Earnings Results Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. [Operator Instructions]

Thank you. Sabra Purtill, Head of Investor Relations, you may begin your conference.

Sabra R. Purtill

Good morning, and welcome to The Hartford's webcast for fourth quarter 2016 financial results. The news release, investor financial supplement and slides for this quarter were all posted on our website yesterday. Please note that we will file our 10-K on February 24. Our speakers today include Chris Swift, Chairman and CEO of The Hartford; Doug Elliot, President; and Beth Bombara, CFO. Following their prepared remarks, we will have about 30 minutes for Q&A. 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 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, which are available on our website.

Our presentation today also 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 supplement. Finally, please note that no portion of this conference call may be reproduced or rebroadcasted 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 at least one year.

I will now turn the call over to Chris.

Christopher J. Swift

Thanks, Sabra. Good morning everyone, and thank you for joining us today. Hartford delivered strong results in Commercial Lines and Group Benefits despite sustained competition this quarter, while personal auto performance remains under pressure from loss cost trends. Doug will cover P&C and Group Benefit results in a few minutes, but I wanted to highlight notable 2016 accomplishments that demonstrate the Hartford's underwriting discipline, effective execution and fundamental strengths of our platform.

Commercial Lines delivered an exceptionally strong underlying combined ratio of 89.4 for the full year. The performance reflects the Hartford's best-in-class operating capabilities, strong market positions and disciplined underwriting. During the year, we also made progress on our strategy to broaden our risk appetite, including entry into the E&S space with the acquisition of Maxum, expanded multinational capabilities through our partnership with AXA and the launch of a dedicated energy practice.

Group Benefits delivered very good results for the full year, with the core earnings margin of 5.7%. We generated profitable growth in this segment, reflecting strong sales, persistency and an improved loss ratio. We