AM Best has affirmed the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) and the Long-Term Issue Credit Ratings (Long-Term IR) of The Hartford Financial Services Group, Inc. (The Hartford) (Delaware) [NYSE: HIG], which is the ultimate parent of the companies hereinafter mentioned. AM Best also has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term ICRs of “aa-” (Superior) of Hartford Fire Insurance Company (Hartford, CT) and its pooling subsidiaries and affiliates, collectively known as the Hartford Insurance Group. The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies and Long-Term ICRs.)

The ratings of the Hartford Insurance Group reflect its balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, favorable business profile and appropriate enterprise risk management (ERM).

The ratings reflect the Hartford Insurance Group’s risk adjusted capitalization, which remains at the strongest level, as measured by Best’s Capital Adequacy Ratio. Additionally, the group reports strong liquidity metrics and has a diverse and well-managed investment portfolio. Hartford Insurance Group also benefits from strong financial flexibility at The Hartford, demonstrating access to capital markets as needed as well as full borrowing capacity to $750 million through its five-year revolving credit facility, which matures in March 2023. AM Best notes that the Hartford Insurance Group also has access to additional funds through its membership with Federal Home Loan Bank of Boston (FHLB). The group continues to maintain a comprehensive reinsurance program with highly rated insurers.

Hartford Insurance Group’s diverse product portfolio and distribution capabilities are a direct contributor to the group’s adequate top line trends and operating performance metrics. AM Best notes that the Navigators operations, acquired in 2019, have been fully integrated and now are considered part of the Hartford Insurance Group. Hartford Insurance Group has reported a steady stream of net investment income supplementing revenue, though yields have been lower due to generally lower reinvestment rates. While premium growth was modest in 2020, driven in part by the impacts from COVID-19, going forward, AM Best expects more favorable written premium growth across core lines of business. Additionally, the group continues to benefit from its Hartford Next cost reduction plan, which has effectively reduced annual operating costs.

The group’s favorable business profile can be attributed to its recognized presence and excellent market position in the property/casualty market as well as its leading position within the group benefits market. Additionally, the group’s experienced management team has proven success in implementation of its business strategies and initiatives supporting its goal of long-term profitable growth.

Hartford Insurance Group continues to work to further evolve its risk management expertise, which is considered to be appropriate for the support of its investment, operations and insurance-related risks.

The Hartford’s debt-to-total capital ratio and interest coverage ratios are within AM Best’s guidelines for its current ratings. AM Best anticipates The Hartford will maintain solid liquidity to support any potential capital needs of its operating subsidiaries.

The FSR of A+ (Superior) and the Long-Term ICRs of “aa-” (Superior) have been affirmed with stable outlooks for the following subsidiaries of The Hartford Financial Services Group, Inc.:

• Hartford Fire Insurance Company
• Hartford Accident and Indemnity Company
• Hartford Insurance Company of Illinois
• Hartford Casualty Insurance Company
• Hartford Underwriters Insurance Company
• Pacific Insurance Company, Limited
• Twin City Fire Insurance Company
• Nutmeg Insurance Company
• Hartford Insurance Company of the Midwest
• Hartford Insurance Company of the Southeast
• Hartford Life and Accident Insurance Company
• Property and Casualty Insurance Company of Hartford
• Trumbull Insurance Company
• Sentinel Insurance Company, Ltd.
• Hartford Lloyd’s Insurance Company
• Navigators Insurance Company
• Navigators Specialty Insurance Company
• Maxum Indemnity Company
• Maxum Casualty Insurance Company

The following Long-Term IRs have been affirmed with stable outlooks:

The Hartford Financial Services Group, Inc. —

-- “a-” (Excellent) on $600 million 2.8% senior unsecured notes, due 2029

-- “a-” (Excellent) on $300 million 5.95% senior unsecured notes, due 2036

-- “a-” (Excellent) on $300 million 6.625% senior unsecured notes, due 2040 (approximately $295 million outstanding)

-- “a-” (Excellent) on $409 million 6.1% senior unsecured notes, due 2041

-- “a-” (Excellent) on $425 million 6.625% senior unsecured notes, due 2042 (approximately $178 million outstanding)

-- “a-” (Excellent) on $300 million 4.3% senior unsecured notes, due 2043

-- “a-” (Excellent) on $500 million 4.4% senior unsecured notes, due 2048

-- “a-” (Excellent) on $800 million 3.6% senior unsecured notes, due 2049

-- “bbb” (Good) on $600 million fixed-to-floating rate junior subordinated debentures, due 2042

-- “bbb” (Good) on $500 million floating rate junior subordinated debentures, due 2067

-- “bbb” (Good) on $345 million 6% non-cumulative preferred stock

The following indicative Long-Term IRs on securities available under the shelf registration have been affirmed with stable outlooks:

The Hartford Financial Services Group, Inc.—

-- “a-” (Excellent) on senior unsecured

-- “bbb+” (Good) on senior subordinated

-- “bbb” (Good) on preferred stock

-- “bbb” (Good) on junior subordinated

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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