The Hartford faces risks from economic downturns, market volatility (interest rates, equity prices, currency exchange), unfavorable loss development (especially long-tailed exposures like asbestos and environmental claims), competitor actions, and potential defaults by counterparties (reinsurers, investors). Changes in accounting estimates, acquisitions, and regulatory/legal developments also pose risks. The company's overseas investments and reliance on reinsurance add further complexity.
Financial Upside
The Hartford anticipates increased revenue from higher earned premiums in property and casualty and group benefits, and higher net investment income due to higher interest rates and increased invested assets. Improved net realized gains from investment sales and valuation improvements on equity securities are also positive factors. Share repurchases reduce outstanding shares, potentially increasing book value per share.
