The Hartford 2008 Annual Report Download - page 220

Table of Contents
Personal Lines - Underwriting Summary 2008 2007 2006
Written premiums $ 3,925 $ 3,947 $ 3,877
Change in unearned premium reserve (1) 58 117
Earned premiums 3,926 3,889 3,760
Losses and loss adjustment expenses
Current accident year before catastrophes 2,542 2,576 2,396
Current accident year catastrophes 258 125 120
Prior accident years (51) (4) (38)
Total losses and loss adjustment expenses 2,749 2,697 2,478
Amortization of deferred policy acquisition costs 633 617 622
Insurance operating costs and expenses 264 253 231
Underwriting results $ 280 $ 322 $ 429
Loss and loss adjustment expense ratio
Current accident year before catastrophes 64.8 66.2 63.8
Current accident year catastrophes 6.6 3.2 3.2
Prior accident years (1.3) (0.1) (1.0)
Total loss and loss adjustment expense ratio 70.0 69.3 65.9
Expense ratio 22.8 22.4 22.7
Combined ratio 92.9 91.7 88.6
Catastrophe ratio
Current accident year 6.6 3.2 3.2
Prior accident years 0.2 0.2 (0.4)
Total catastrophe ratio 6.8 3.4 2.8
Combined ratio before catastrophes 86.1 88.3 85.8
Combined ratio before catastrophes and prior accident year
development 87.6 88.6 86.4
Other revenues [1] $ 135 $ 141 $ 135
[1] Represents servicing revenue
Combined Ratios 2008 2007 2006
Automobile 91.0 96.2 93.6
Homeowners 97.6 79.8 74.0
Total 92.9 91.7 88.6
Underwriting Results and Ratios
Year ended December 31, 2008 compared to the year ended December 31, 2007
Underwriting results decreased by $42, from $322 in 2007 to $280 in 2008, with a corresponding 1.2 point increase in the
combined ratio, from 91.7 to 92.9 due to:
Change in underwriting results
Increase in earned premiums $ 37
Losses and loss adjustment expenses
Ratio change — A decrease in the current accident loss and loss adjustment expense ratio
before catastrophes 59
Volume change — Increase in current accident year losses and loss adjustment expenses before
catastrophes due to the increase in earned premium (25)
Decrease in current accident year losses and loss adjustment expenses before catastrophes 34
Catastrophes — Increase in current accident year catastrophes (133)
Reserve changes — An increase in net favorable prior accident year reserve development 47
Net increase in losses and loss adjustment expenses (52)
Operating expenses
Increase in amortization of deferred policy acquisition costs (16)
Increase in insurance operating costs and expenses (11)
Increase in operating expenses (27)
Decrease in underwriting results from 2007 to 2008 $ (42)
Source: HARTFORD FINANCIAL S, 10-K, February 12, 2009