The Hartford 2011 Annual Report Download - page 6

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Commercial Markets
The Commercial Markets division is organized into two reporting segments; Property & Casualty Commercial and Group Benefits.
Principal Products and Services
Property & Casualty Commercial provides workers’ compensation, property, automobile, liability and umbrella coverages under several
different products, primarily throughout the United States, within its standard commercial lines, which consists of The Hartford’ s small
commercial and middle market lines of business. Additionally, a variety of customized insurance products and risk management
services including workers’ compensation, automobile, general liability, professional liability, fidelity, surety, livestock and specialty
casualty coverages are offered to large companies through the segment’ s specialty lines.
Standard commercial lines seeks to offer products with more coverage options and customized pricing based on the policyholder’ s
individualized risk characteristics. For small businesses, those businesses whose annual payroll is under $5 and whose revenue and
property values are less than $15 each, coverages are bundled as part of a single multi-peril package policy marketed under the
Spectrum name. Medium-sized businesses, companies whose payroll, revenue and property values exceed the small business definition,
are served within middle market. The middle market line of business provides workers’ compensation, property, automobile, liability,
umbrella and marine coverages. The sale of Spectrum business owners’ package policies and workers’ compensation policies accounts
for the majority of the written premium in the standard commercial lines.
Within the specialty lines, a significant portion of the specialty casualty business, including workers’ compensation business, is written
through large deductible programs where the insured typically provides collateral to support loss payments made within their deductible.
The specialty casualty business also provides retrospectively-rated programs where the premiums are adjustable based on loss
experience. Captive and Specialty Programs provide insurance products and services primarily to captive insurance companies, pools
and self-insurance groups.
Group Benefits provides group life, accident and disability coverage, group retiree health and voluntary benefits to individual members
of employer groups, associations, affinity groups and financial institutions. Group Benefits offers disability underwriting,
administration, claims processing and reinsurance to other insurers and self-funded employer plans. Policies sold in this segment are
generally term insurance, allowing Group Benefits to adjust the rates or terms of its policies in order to minimize the adverse effect of
market trends, declining interest rates, and other factors. Policies are typically sold with one, two or three-year rate guarantees
depending upon the product.
In addition to the products and services traditionally offered within each of its lines of business, Commercial Markets offers The
Hartford Productivity Advantage (“THPA”), a single-company solution for leave management, integrating the insurer's short- and long-
term group disability and workers' compensation insurance with its leave management administration services.
Marketing and Distribution
Standard commercial lines provide insurance products and services through the Company’ s home office located in Hartford,
Connecticut, and multiple domestic regional office locations and insurance centers. The products are marketed nationwide utilizing
brokers and independent agents. The current pace of consolidation within the independent agent and broker distribution channel will
likely continue such that, in the future, a larger proportion of written premium will likely be concentrated among fewer agents and
brokers. Additionally the Company offers insurance products to customers of payroll service providers through its relationships with
major national payroll companies.
Specialty lines also provide insurance products and services through its home office located in Hartford, Connecticut and multiple
domestic office locations. Specialty lines markets its products nationwide utilizing a variety of distribution networks including
independent retail agents, brokers and wholesalers.
The Group Benefits distribution network includes an experienced group of Company employees, managed through a regional sales
office system, to distribute its group insurance products and services through a variety of distribution outlets including brokers,
consultants, third-party administrators and trade associations.
The Company is engaged in a nationwide joint sales initiative across standard commercial lines, specialty lines and Group Benefits,
facilitating the marketing of both integrated and traditional products and services across commercial markets.