Unfavorable (Favorable) Prior Accident Year Development


	For the three months ended March 31,
		2023		2022
Workers’ compensation		$	(61)	$	(45)
Workers’ compensation discount accretion		11		9
General liability		12		12
Marine		1		—
Package business		(5)		(11)
Commercial property		5		(15)
Professional liability		—		—
Bond		—		—
Assumed reinsurance		2		12
Automobile liability - Commercial Lines		—		—
Automobile liability - Personal Lines		—		(5)
Homeowners		(1)		—
Net asbestos and environmental reserves		—		—



Catastrophes		—		(3)
Uncollectible reinsurance		8		—
Other reserve re-estimates, net		28		10


Total prior accident year development		$	—	$	(36)

Re-estimates of prior accident year reserves for the three months ended March 31, 2023

Workers’ compensation reserves were decreased within the 2014 to 2019 accident years primarily in small commercial, driven by lower than previously estimated claim severity. In addition, the 2020 accident year reflects a $20 reduction of COVID-19 related reserves.

General liability reserves were increased in middle and large commercial, driven by an increase in the frequency and estimated cost to settle large individual claims for the 2016 to 2021 accident years.

Package business reserves decreased primarily due to lower than previously estimated property severity for accident year 2021. Package liability is flat overall with improvement in accident year 2020 due to favorable claim count emergence offset by reserve increases in accident years 2019 and prior related to higher severity.

Commercial property reserves were increased due to unfavorable development for accident year 2022 in middle & large commercial.

Automobile liability reserves - Personal Lines were flat as decreases due to lower estimated severity, within accident years 2019 to 2021 were offset by increases in accident year 2022 due to higher estimated severity and increasing attorney representation rates.

Uncollectible reinsurance was increased primarily in Commercial Lines related to a captive reinsurer, and to a lesser extent in P&C Other Operations related to one larger reinsurer entering liquidation proceedings.

Other reserve re-estimates, net, were increased primarily due to an increase in accident year 2022 Personal Lines automobile physical damage severity.

Re-estimates of prior accident year reserves for the three months ended March 31, 2022

Workers’ compensation reserves were decreased for the 2014 through 2018 accident years, predominately within small commercial, driven by lower than previously estimated claim severity.

General liability reserves were increased, driven by an increase in the estimated cost to settle large individual claims in middle and large commercial for the 2016 to 2019 accident years.

Package business reserves decreased largely due to lower estimated loss adjustment expenses for accident years 2015 to 2018 and a reduction in property reserves for the 2020 accident year.

Commercial property reserves were decreased primarily due to favorable development for the 2020 accident year in middle & large commercial related to COVID-19 claims and a reduction in property reserves for the 2021 accident year.

Assumed reinsurance reserves were increased primarily due to higher reserve estimates for syndicate property claims, including higher expected COVID-19 property losses in the 2020 accident year and increased reserves for international agriculture related to drought claims.

Automobile liability reserves were decreased in Personal Lines principally due to lower estimated severity on AARP Direct claims, primarily within accident years 2016 to 2020.

Other reserve re-estimates, net, were increased primarily due to unfavorable development from participation in involuntary market pools.

Settlement Agreement with Boy Scouts of America

On September 14, 2021, the Company announced that it entered into a new agreement-in-principle with the Boy Scouts of America ("BSA"), related to sexual molestation and sexual abuse claims associated with liability policies issued by various Hartford writing companies in the 1970s and early 1980s, with the agreement in-principle including the BSA, its local councils and the representatives of a majority of the sexual abuse claimants. As part of the agreement-in-principle, The Hartford will pay $787, before tax, for claims associated with these policies. In exchange for The Hartford’s payment, the BSA and its local councils will fully release The Hartford from any obligation under policies The Hartford issued to the BSA and its local councils. In addition, the representatives for the claimants joining this agreement-in-principle will support a plan of reorganization which incorporates the settlement.

The agreement-in-principle was reached in connection with the BSA’s Chapter 11 bankruptcy and a written settlement agreement (the "Settlement") was executed on February 14, 2022. On September 8, 2022 the bankruptcy court approved the BSA's plan of reorganization, including the Settlement. On

March 28, 2023, the civil district court affirmed the bankruptcy court’s ruling. The civil district court’s ruling is now final, all conditions precedent to Settlement have been satisfied and on April 20, 2023, The Hartford paid the Settlement amount of $787. Certain objecting parties have indicated that they will appeal the civil district court’s ruling. If the court approvals for the BSA’s plan of reorganization are not affirmed on appeal, it is possible that adverse outcomes, if any, could have a material adverse effect on the Company’s operating results.

Rollforward of Liabilities for Unpaid Losses and Loss Adjustment Expenses


	For the three months ended March 31,
	2023		2022
Beginning liabilities for unpaid losses and loss adjustment expenses, gross	$	8,160	$	8,210
Reinsurance recoverables	245		245
Beginning liabilities for unpaid losses and loss adjustment expenses, net	7,915		7,965

Provision for unpaid losses and loss adjustment expenses
Current incurral year	1,325		1,324
Prior year's discount accretion	53		53
Prior incurral year development [1]	(133)		(119)
Total provision for unpaid losses and loss adjustment expenses [2]	1,245		1,258
Payments
Current incurral year	(335)		(354)
Prior incurral years	(889)		(974)
Total payments	(1,224)		(1,328)
Ending liabilities for unpaid losses and loss adjustment expenses, net	7,936		7,895
Reinsurance recoverables	248		247
Ending liabilities for unpaid losses and loss adjustment expenses, gross	$	8,184	$	8,142

[1]Prior incurral year development represents the change in estimated ultimate incurred losses and loss adjustment expenses for prior incurral years on a discounted basis.

[2]Includes unallocated loss adjustment expenses ("ULAE") of $45 and $46 for the three months ended March 31, 2023 and 2022, respectively, that are recorded in insurance operating costs and other expenses in the Condensed Consolidated Statements of Operations.

Re-estimates of prior incurral years reserves for the three months ended March 31, 2023

Group disability- Prior period reserve estimates decreased by approximately $120 largely driven by group long-term disability claim incidence lower than prior assumptions and strong recoveries on prior incurral year claims.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $8 largely driven by continued low incidence in group life premium waiver.

Supplemental accident and health- Prior period reserve estimates decreased by approximately $5 driven by lower than previously expected claim incidence.

Re-estimates of prior incurral years reserves for the three months ended March 31, 2022

Group disability- Prior period reserve estimates decreased by approximately $80 largely driven by group long-term disability claim incidence lower than prior assumptions together with strong recoveries on prior incurral year claims.

Group life and accident (including group life premium waiver)- Prior period reserve estimates decreased by approximately $35 largely driven by a reduction in estimated mortality group term life losses incurred in fourth quarter 2021, as well as continued low incidence in group life premium waiver.

. RESERVE FOR FUTURE POLICY BENEFITS


Rollforward of Reserve for Future Policy Benefits
	For the three months ended March 31,
	2023						2022
	Payout Annuities		Life Conversions		Paid-up Life		Payout Annuities		Life Conversions		Paid-up Life
Present Value of Expected Net Premiums
Balance, beginning of the period			$	47					$	58
Balance, ending of the period			$	46					$	52

Present Value of Expected Future Policy Benefits
Beginning balance at single-A rate	$	140	$	112	$	192	$	188	$	152	$	262
Beginning adjustment for changes in single-A rate	4		(14)		(39)		47		19		14
Beginning balance at original discount rate	136		126		231		141		133		248
Effect of actual variances from expected experience	—		2		—		1		1		—
Adjusted beginning balance	136		128		231		142		134		248
Interest accrual	2		4		2		2		4		2
Benefit Payments	(3)		(7)		(6)		(3)		(7)		(5)
Ending balance at original discount rate	135		125		227		141		131		245
Ending adjustment for changes in single-A rate	8		(12)		(35)		28		5		(11)
Ending balance at single-A rate	$	143	$	113	$	192	$	169	$	136	$	234

Net reserve for future policy benefits	$	143	$	67	$	192	$	169	$	84	$	234
Weighted-average duration of the reserve for future policy benefits (years)	9.1		12.3		6.5		9.2		14.1		7.5


Net Reserve for Future Policy Benefits
	As of March 31,
	2023		2022
Payout Annuities	$	143	$	169
Life Conversions	67		84
Paid-up Life	192		234
DPL	19		20
Other	87		85
Total	$	508	$	592


Undiscounted Expected Future Gross Premiums and Benefit Payments
	As of March 31,
	2023		2022
Payout Annuities [1]
Expected future benefit payments	$	269	$	281
Life Conversions
Expected future gross premiums	$	118	$	126
Expected future benefit payments	$	208	$	221
Paid-up Life [1]
Expected future benefit payments	$	295	$	319

[1]Payout Annuities and Paid-up Life have no expected future gross premiums.


Weighted-Average Interest Rates
	For the three months ended March 31,
	2023		2022
Payout Annuities
Interest accretion rate	5.6	%	5.6	%
Current discount rate	5.0	%	3.7	%
Life Conversions
Interest accretion rate	4.2	%	4.1	%
Current discount rate	5.1	%	3.8	%
Paid-up Life
Interest accretion rate	2.9	%	2.9	%
Current discount rate	5.0	%	3.3	%

Gross premiums and interest accretion recognized on long-duration insurance policies for the three months ended March 31, 2023 and 2022 were immaterial.