AM Best Affirms Credit Ratings of The Hartford Financial Services Group, Inc. and Its Subsidiaries

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, as well as Hartford Life and Accident Insurance Company (Hartford, CT) and Navigators Insurance Company (New York, NY), 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 IRs.)

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 group’s balance sheet assessment continues to be anchored by its strongest risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). Additionally, The Hartford’s financial leverage has shown a downward trend over the last five years and the organization maintains significant financial flexibility through access to its $750 million five-year revolving credit facility, as well as its membership with Federal Home Loan Bank of Boston. The organization has proactively managed through the challenging rate environment of recent years resulting in a durable investment portfolio, which is highly rated and well diversified. In addition, the organization has a strong track record of generating good net cash flows and maintaining more than adequate overall liquidity to support its business needs.

Hartford Insurance Group’s consistent operating performance reflects the strength of its brand and reputation, as well as its diversified distribution and products across its various segments. Operating metrics continue to be in line with, or have exceeded, its peers and similarly rated companies in recent years. Most recently, Hartford reported double digit premium growth in its core property/casualty lines of business, reflecting sales growth and pricing actions in certain lines of business. Also similar to its peers, the company did experience some pressure from increased catastrophic events, as well as the impact of increased severity of auto liability and physical damage claims. Separately, the group benefits segment continues to provide a steady stream of income driven by the growth in fully insured ongoing premiums and lower expense ratio. Hartford Insurance Group continues to work to enhance its risk management expertise further, which is considered to be appropriate for the support of its investments, operations and insurance-related risks.

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

-- “a-” (Excellent) on $600 million 2.9% senior unsecured notes, due 2051

-- “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 junior subordinated

-- “bbb” (Good) on preferred stock

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 Performance Assessments, 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.

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