Hartford Insurance Group (HIG) 10-K risk factor changes: FY2018 vs FY2017

confidential or proprietary information could result in legal liability, regulatory action and reputational harm.

Third parties, including third party administrators, are also subject to cyber-breaches of confidential information, along with the other risks outlined above, any one of which may result in our incurring substantial costs and other negative consequences, including a material adverse effect on our business, reputation, financial condition, results of operations and liquidity.

While we maintain cyber liability insurance that provides both third party liability and first party insurance coverages, our insurance may not be sufficient to protect against all loss.

Performance problems due to outsourcing and other third-party relationships may compromise our ability to conduct business.

We outsource certain business and administrative functions and rely on third-party vendors to perform certain functions or provide certain services on our behalf and have a significant number of information technology and business processes outsourced with a single vendor.

If we are unable to reach agreement in the negotiation of contracts or renewals with certain third-party providers, or if such third-party providers experience disruptions or do not perform as anticipated, we may be unable to meet our obligations to customers and claimants, incur higher costs and lose business which may have a material adverse effect on our business and results of operations.

For other risks associated with our outsourcing of certain functions, see the immediately preceding risk factor.

Our ability to execute on capital management plans, expense reduction initiatives and other actions is subject to material challenges, uncertainties and risks.

The ability to execute on capital management plans is subject to material challenges, uncertainties and risks.

From time to time, our capital management plans may include the repurchase of common stock, the paydown of outstanding debt or both.

We may not achieve all of the benefits we expect to derive from these plans.

In the case an equity repurchase plan is approved by the Board, such capital management plan would be subject to execution risks, including, among others, risks related to market fluctuations, investor interest and potential legal constraints that could delay execution at an otherwise optimal time.

There can be no assurance that we will fully execute any such plan.

In addition, we may not be successful in keeping our businesses cost efficient.

The Company may not be able to achieve all the revenue increases, expense reductions and other synergies that it expects to realize as a result of acquisitions, divestitures or restructurings.

We may take future actions, including acquisitions, divestitures or restructurings that may involve additional uncertainties and risks that negatively impact our business, financial condition, results of operations and liquidity.

Failure to complete our proposed acquisition of The Navigators Group, Inc. could impact our securities.

The completion of the acquisition of The Navigators Group, Inc. (Navigators Group) is subject to a number of conditions, including required regulatory approvals.

The failure to satisfy all the required conditions could prevent the acquisition from occurring.

In addition, regulators could impose additional requirements or obligations as conditions for their approval.

We can provide no assurance that we will obtain the necessary approvals within the estimated timeframe or at all, or that any such requirements that are imposed by regulators would not result in the termination of the transaction.

Investors’ reactions to a failure to complete the acquisition of Navigators Group, including possible speculation about alternative uses of capital, may cause volatility in our securities.

A failure to complete a proposed transaction of this nature can also result in litigation by stockholders and other disaffected parties.

Furthermore, we will have incurred costs, and devoted management time and resources, in connection with the transaction for which we will receive little or no benefit.

In addition, even if we complete the proposed Navigators Group acquisition, we may not be able to successfully integrate Navigators Group into our business and therefore may not be able to achieve the synergies we would expect to receive as a result of the acquisition.

Acquisitions and divestitures may not produce the anticipated benefits and may result in unintended consequences, which could have a material adverse impact on our financial condition and results of operations.

We may not be able to successfully integrate acquired businesses or achieve the expected synergies as a result of such acquisitions or divestitures.

The process of integrating an acquired company or business can be complex and costly and may create unforeseen operating difficulties including ineffective integration of underwriting, risk management, claims handling, finance, information technology and actuarial practices.

Difficulties integrating an acquired business may also result in the acquired business performing differently than we expected including through the loss of customers or in our failure to realize anticipated increased premium growth or expense-related efficiencies.

We could be adversely affected by the acquisition due to unanticipated performance issues and additional expense, unforeseen liabilities, transaction-related charges, downgrades of third-party rating agencies, diversion of management time and resources to integration challenges, loss of key employees, regulatory requirements, exposure to tax liabilities, amortization of expenses related to intangibles and charges for impairment of long-term assets or goodwill.

In addition, we may be adversely impacted by uncertainties related to reserve estimates of the acquired company and its design and operation of internal controls over financial reporting.

We may be unable to distribute as much capital to the holding company as planned due to regulatory restrictions or other reasons that may adversely affect our liquidity.

In addition in the case of business dispositions, we may have difficulties in separating from our divested businesses which may result in our incurring additional, unforeseen expenses, and diversion of management’s time and resources to the challenges of business separation.

In the case of business or asset dispositions, we may have continued financial exposure to the divested businesses through reinsurance, indemnification or other financial arrangements following the transaction.

We may also retain a position in securities of the acquirer that purchased the divested business, which subjects us to risks related to the price of the equity securities and our ability to monetize such securities.

The expected benefits of acquired or divested

businesses may not be realized and involve additional uncertainties and risks that may negatively impact our business, financial condition, results of operations and liquidity.

Difficulty in attracting and retaining talented and qualified personnel may adversely affect the execution of our business strategies.

Our ability to attract, develop and retain talented employees, managers and executives is critical to our success.

There is significant competition within and outside the insurance and financial services industry for qualified employees, particularly for individuals with highly specialized knowledge in areas such as underwriting, actuarial, data and analytics, technology and digital commerce.

A decline in equity markets may result in lower earnings from the life and annuity business where fee income is earned based upon the fair value of the assets under management.

In addition, certain annuity products have guaranteed minimum death benefits ("GMDB") or guaranteed minimum withdrawal benefits ("GMWB") that increase when equity markets decline requiring more statutory capital to be held.

While hedging programs are used to reduce the net economic sensitivity of our potential obligations from guaranteed benefits due to market fluctuations, rising equity markets and/or rising interest rates may nevertheless result in statutory or GAAP losses because of accounting asymmetries between hedging targets and statutory and GAAP accounting principles for the guaranteed benefits.

A low interest rate environment puts pressure on net investment income and could result in lower margins and lower estimated gross profits on certain annuity products included in discontinued operations.

A rise in interest rates, in the absence of other countervailing changes, would reduce the market value of the life and annuity business investment portfolio and, if long-term interest rates were to rise dramatically, certain products within that business might be exposed to disintermediation risk.

Disintermediation risk refers to the risk that policyholders may surrender their contracts in a rising interest rate environment, requiring the liquidation of assets in an unrealized loss position.

Some of the in-force variable annuity contracts included in discontinued operations offer guaranteed benefits, including GMDBs and GMWBs.

These GMBDs and GMWBs are exposed to interest rate risk and significant equity risk.

A decline in equity markets would not only result in lower fee income, but would also increase the Company's exposure to liability for benefit claims.

Reinsurance and benefit designs, such as caps, are used to mitigate the exposure associated with GMDB.

To minimize the claim exposure and to reduce the volatility of net income associated with the GMWB liability, reinsurance is used in combination with product management actions, such as rider fee increases, investment restrictions and buyout offers, as well as derivative instruments.

The contract issuer remains liable for the guaranteed benefits in the event that reinsurers or derivative counterparties are unable or unwilling to pay, which could result in a need for additional capital to support in-force business.

From time to time, the risk management program may be adjusted based on contracts in force, market conditions, or other factors.

While these actions may improve the efficiency of our risk management efforts related to these benefits, changes to the risk management program may result in greater statutory and GAAP earnings volatility and, based upon the types of hedging instruments used, can result in potentially material changes to net income (loss) in periods of rising equity market pricing levels, higher interest rates and declines in volatility.

The life and annuity run-off business is also subject to the risk that these management actions prove ineffective or that unanticipated policyholder behavior, combined with adverse market events, produces economic losses beyond the scope of the risk management techniques employed, which individually or collectively may have a material adverse effect on the business, financial condition, results of operations and liquidity of the discontinued operations.

The minimum capital that must be held by the life and annuity companies is based on risk-based capital (“RBC”) formulas for life

companies.

The RBC formula for life companies establishes capital requirements relating to insurance, business, asset and interest rate risks, including equity, interest rate and expense recovery risks associated with variable annuities and group annuities that contain death benefits or certain withdrawal benefits.

In extreme scenarios of equity market declines and other capital market volatility, the amount of additional statutory reserves that must be held for variable annuity guarantees increases at a greater than linear rate.

This reduces the statutory surplus used in calculating RBC ratios.

When equity markets increase, surplus levels and RBC ratios would generally be expected to increase.

However, as a result of a number of factors and market conditions, including the level of hedging costs and other risk transfer activities, statutory reserve requirements for death and withdrawal benefit guarantees and increases in RBC requirements, surplus and RBC ratios may not increase when equity markets increase.

Due to these factors, projecting statutory capital and the related RBC ratios is complex.

The investment portfolio of the life and annuity business included in discontinued operations is also exposed to losses due to nonperformance or defaults by counterparties.

For example, if the counterparties to the underlying assets supporting the structured securities we invest in default on their payment obligations, the securities held will incur losses.

While a portion of contracts with GMWB riders are reinsured and the majority of GMDB contracts with net amount at risk are reinsured, the insurers that wrote the contracts remain liable as the direct insurer on all risks reinsured.

The inability or unwillingness of any reinsurer to meet its financial obligations, including the impact of any insolvency or rehabilitation proceedings involving a reinsurer, could affect the life and annuity companies’ access to collateral held in trust.

This risk may be magnified by a concentration of reinsurance-related credit risk resulting from the sale of the Individual Life and Retirement Products businesses in 2013 though that business is part of the Talcott Resolution operations being sold to the Buyer.

Life and annuity products also contain risks relating to estimates, assumptions and valuations.

If assumptions used in estimating future gross profits differ from actual experience, it may accelerate the amortization of deferred acquisition costs ("DAC") and increase reserves for GMDB and GMWB on variable annuities.

Deferred acquisition costs for the variable annuity products included in discontinued operations are amortized over the expected life of the contracts.

The remaining deferred but not yet amortized cost is referred to as the DAC asset.

These costs are amortized based on the ratio of actual gross profits in the period to the present value of current and future estimated gross profits (“EGPs”).

EGP’s are used to determine if a DAC impairment exists.

Certain reserves for GMDB and the life contingent portion of GMWB are valued using components of EGPs.

The projection of EGPs, or components of EGPs, requires the use of certain assumptions that may not prove accurate, including those related to changes in the separate account fund returns, full or partial surrender rates, mortality, withdrawal benefit utilization, withdrawal rates, annuitization and hedging costs.

In addition, if assumptions about policyholder behavior (e.g., full or partial surrenders, benefit utilization and annuitization) and costs related to mitigating risks, including hedging costs, prove to

be inaccurate or if significant or sustained equity market declines occur, there could be a further acceleration of DAC amortization related to variable annuity contracts, and increased reserves for GMDB and life-contingent GMWB.

As noted above, the 2017 tax reform reduced the value of net deferred tax assets, including net deferred tax assets to be transferred to the Buyer.

Provisions included in the tax reform legislation further limited the corporate dividends received deduction and there is a risk that Congress could further reduce or eliminate the corporate dividends received deduction altogether.

[removed: Impact Inadequate capital resources and liquidity could negatively affect] [added: The following section discusses] the [removed: Company’s] overall financial strength [added: of The Hartford] and its [added: insurance operations including their] ability to generate cash flows from [removed: its businesses,] [added: each of their business segments,] borrow funds at competitive [removed: rates,] [added: rates] and raise new capital to meet [removed: operating and growth needs.]

[removed: Credit] [added: Credit] Risk [added: of Derivatives]

[removed: Sources] [added: Sources] of Credit [removed: Risk] [added: Risk] The majority of the Company’s credit risk is concentrated in its investment holdings, but it is also present in the Company’s reinsurance and insurance portfolios.

[removed: Impact] [added: Impact] A decline in creditworthiness is typically associated with an increase in an investment’s credit spread, [removed: and] potentially [removed: result] [added: resulting] in an increase in other-than-temporary [removed: impairments] [added: impairment,] and an increased probability of a realized loss upon sale.

[removed: Management] [added: Management] The objective of the Company’s enterprise credit risk management strategy is to identify, quantify, and manage credit risk on an aggregate portfolio basis and to limit potential losses in accordance with an established credit risk management policy.

The Company primarily manages its credit risk by holding a diversified mix of investment grade issuers and counterparties across its investment, reinsurance, and insurance [added: portfolios.]

Within the investment portfolio, private securities are subject to [removed: committee review for] [added: management] approval.

As of December 31, [removed: 2017,] [added: 2018,] the Company had no investment exposure to any credit concentration risk of a single issuer or counterparty greater than 10% of the Company's stockholders' equity, other than the U.S. government and certain U.S. government [removed: securities.][added: agencies.]

[removed: Assets] [added: Assets] and Liabilities Subject to Credit [removed: Risk][added: Risk]

[removed: Investments] [added: Investments] Essentially all of the Company's invested assets are subject to credit risk.

Credit related impairments on investments were [removed: $2] [added: $1] and [removed: $21,] [added: $2,] in [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

[removed: Reinsurance recoverables] [added: Reinsurance recoverables] Reinsurance recoverables, net of an allowance for uncollectible reinsurance, were [removed: $4,061] [added: $4,357] and [removed: $3,659,] [added: $4,061,] as of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

[removed: Premiums] [added: Premiums] receivable and agents' [removed: balances] [added: balances] Premiums receivable and agents’ balances, net of an allowance for doubtful accounts, were [removed: $3,910] [added: $3,995] and [removed: $3,730,] [added: $3,910,] as of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

[removed: Credit Risk] [added: Use] of [removed: Derivatives][added: Credit Derivatives]

In some cases, downgrades may give derivative counterparties for [removed: over-the-counter] [added: OTC] derivatives and clearing brokers for OTC-cleared derivatives the right to cancel and settle outstanding derivative trades or require additional collateral to be posted.

[removed: Managing] [added: Managing] the Credit Risk of Counterparties to Derivative [removed: Instruments][added: Instruments]

The Company [added: also] has derivative counterparty exposure policies which limit the Company’s exposure to credit risk.

The Company also generally requires that OTC derivative contracts be governed by an International Swaps and Derivatives Association ("ISDA") Master Agreement, [added: which is structured by legal entity and by counterparty and permits right of offset.]

Credit exposures are [removed: measured using the market value of] [added: generally quantified based on] the [removed: derivatives,] [added: prior business day's net fair value, including income accruals,] resulting in amounts owed to the Company by its counterparties or potential payment obligations from the Company to its counterparties.

For purposes of daily derivative collateral maintenance, credit exposures are generally quantified based on the prior business day’s market value and collateral is pledged to and held by, or on behalf of, the Company to the extent the current value of the derivatives [removed: exceed the contractual] [added: is greater than zero, subject to minimum transfer] thresholds.

For further [removed: discussion,] [added: information regarding Preferred Stock,] see [removed: the Derivative Commitments section of] Note [removed: 14 Commitments and Contingencies] [added: 15 - Equity] of Notes to Consolidated Financial Statements.

For the year ended December 31, [removed: 2017,] [added: 2018,] the Company incurred no losses on derivative instruments due to counterparty default.

As of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] the notional amount related to credit derivatives that purchase credit protection was [removed: $61] [added: $6] and [removed: $78,] [added: $61,] respectively, while the fair value was [removed: $1] [added: $0] and [removed: $(1),] [added: $1,] respectively.

[added: Replication] transactions are used as an economical means to synthetically replicate the characteristics and performance of assets that are [removed: permissible investments under the Company’s investment policies.]

As of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] the notional amount related to credit derivatives that assume credit risk was [removed: $823] [added: $1.1 billion] and [removed: $851,] [added: $823,] respectively, while the fair value was $3 [removed: and $6, respectively.][added: for both periods.]

[removed: Interest] [added: Interest] Rate [removed: Risk][added: Risk]

[removed: Sources] [added: Sources] of Interest Rate [removed: Risk] [added: Risk] The Company has exposure to interest rates arising from its fixed maturity [removed: securities] [added: securities, long-term debt obligations, short] and [added: long-term disability claim reserves, and] discount rate assumptions associated with the Company’s pension and other post retirement benefit obligations.

[removed: Impact] [added: Impact] Changes in interest rates from current levels can have both favorable and unfavorable effects for the Company.

| [removed: Change] [added: Change] in Interest [removed: Rates] [added: Rates] | [removed: Favorable Effects] [added: Favorable Effects] | [removed: Unfavorable Effects] [added: Unfavorable Effects] |

| [removed: Lower interest expense on variable rate debt obligations] | Acceleration in paydowns and prepayments or calls of certain mortgage-backed and municipal securities | |

[removed: Management] [added: Management] The Company primarily manages its exposure to interest rate risk by constructing investment portfolios that seek to protect the firm from the economic impact associated with changes in interest rates by setting portfolio duration targets that are aligned with the duration of the liabilities that they support.

As of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] notional amounts pertaining to derivatives utilized to manage interest rate risk, including offsetting positions, totaled [removed: $10.2] [added: $10.5] billion and [removed: $10.6] [added: $10.2] billion, respectively [added: primarily] related to investments.

The fair value of these derivatives was [removed: $(83)] [added: $(61)] and [removed: $(565)] [added: $(83)] as of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

[removed: Assets] [added: Assets] and Liabilities Subject to Interest Rate [removed: Risk][added: Risk]

[removed: Fixed] [added: Fixed] income [removed: investments] [added: investments] The fair value of fixed income investments, which include fixed maturities, commercial mortgage loans, and short-term investments, was [removed: $42.5] [added: $43.7] billion and [removed: $37.2] [added: $42.5] billion at December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

The weighted average duration of the portfolio, including derivative instruments, was approximately [removed: 5.2] [added: 4.7] years and [removed: 5.0] [added: 5.2] years as of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] respectively.

[removed: Group] [added: Group] life and disability product [removed: liabilities] [added: liabilities] The cash outflows associated with contracts issued by the Company's Group Benefits segment, primarily group life and short and long-term disability policy liabilities, are not interest rate sensitive but vary based on timing.

As of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] the Company had [removed: $8,512] [added: $8,445] and [removed: $5,772,] [added: $8,512,] respectively of reserves for group life and disability [removed: contracts with the increase since December 31, 2016 largely due to the acquisition of Aetna's U.S. group life and disability business.][added: contracts.]

[removed: Pension] [added: Pension] and other post-retirement benefit [removed: obligations] [added: obligations] The Company’s pension and other post-retirement benefit obligations are exposed to interest rate risk based upon the sensitivity of present value obligations to changes in liability discount [added: rates as well as the sensitivity of the fair value of investments in the plan portfolios to changes in interest] rates.

The Company is exposed to the risk of having to make additional plan contributions if the plans’ investment [removed: returns] [added: returns, including from investments in fixed maturities,] are lower than expected.

facilities as needed.

The Company maintains multiple sources of contingent liquidity including a revolving credit facility, a commercial paper program, an intercompany liquidity agreement that allows for short-term advances of funds among the HFSG Holding Company and certain affiliates, and access to collateralized advances from the Federal Home Loan Bank of Boston ("FHLBB") for certain affiliates.

Credit Risk and Counterparty Risk

permissible investments under the Company’s investment policies.

Credit Risk of Business Operations

A portion of the company's commercial business is written with large deductible policies or retrospectively-rated plans.

Under some commercial insurance contracts with deductible features, the Company is obligated to pay the claimant the full amount of the claim.

The Company is subsequently reimbursed by the contract holder for the deductible amount, and is subject to credit risk until such reimbursement is made.

Additionally, retrospectively rated policies are utilized primarily for workers compensation coverage, whereby the ultimate premium is determined based on actual loss activity.

Although the retrospectively rated feature of the policy substantially reduces insurance risk for the Company, it does introduce credit risk to the Company.

The Company’s results of operations could be adversely affected if a significant portion of such contract holders failed to reimburse the Company for the deductible amount or the retrospectively rated policyholders failed to pay additional premiums owed.

While the Company attempts to manage the risks discussed above through underwriting, credit analysis, collateral requirements, provision for bad debt, and other oversight mechanisms, the Company’s efforts may not be successful.

Changes in the fair value of fixed maturities due to changes in interest rates are reflected as a component of AOCI.

Long-term debt obligations The Company's variable rate debt obligations will generally result in increased interest expense as a result of higher interest rates; the inverse is true during a declining interest rate environment.

Changes in the value of long-term debt as a result of changes in interest rates will impact the fair value of these instruments but not the carrying value in the Company's Consolidated Balance Sheets.

Changes in the value of the liabilities as a result of changes in interest rates will impact the fair value of these instruments but not the carrying value in the Company's Consolidated Balance Sheets.

| | 2018 | | | | | | 2017 | | | | | |

| | 2018 | | | | | | 2017 | | | | | |

| *Basis point shift* | \-100 | | | +100 | | | \-100 | | | +100 | | |

Long-term Debt

A 100 basis point parallel decrease in the yield curve would result in an increase in the fair value of the liability of $331 and $340 as of December 31, 2018 and 2017, respectively.

A 100 basis point parallel increase in the yield curve would result in a decrease in the fair value of the liability of $(279) and $(287) as of December 31, 2018 and 2017, respectively.

Changes in the value of long-term debt as a result of changes in interest rates will not impact the carrying value in the Company's Consolidated Balance Sheets.

Pension and Other Post-Retirement Plan Obligations

A 100 basis point parallel decrease in the yield curve would impact both the value of the underlying pension assets and the value of the liability, resulting in an increase in the net pension and other post-retirement plan obligations liability of $178 and $226 as of December 31, 2018 and 2017, respectively.

A 100 basis point parallel increase in the yield curve would have the inverse effect and result in a decrease in the net pension and other post-retirement plan obligations liability of $(134) and $(170) as of December 31, 2018 and 2017, respectively.

Gains or losses due to changes in interest rates on the pension and post-retirement plan obligations are recorded within AOCI and are amortized into the actuarial loss component of net periodic benefit cost when they exceed a threshold.

Impact The investment portfolio is exposed to losses from market declines affecting equity securities, alternative assets and limited partnerships which could negatively impact the Company's reported earnings.

For assets supporting pension and other post-retirement benefit plans, the Company may be required to make additional plan contributions if equity investments in the plan portfolios decline in value.

Hartford Funds earnings are also significantly influenced by the U.S. and other equity markets.

Generally, declines in equity markets will reduce the value of these types of investments and could negatively impact the Company’s earnings while increases in equity will have the inverse impact.

For equity securities, the changes in fair value are reported in net realized capital gains and losses.

For alternative assets and limited partnerships, the Company's share of earnings for the period is recorded in net investment income, though typically on a delay based on the availability of the underlying financial statements.

For a discussion of equity sensitivity, see below.

For a discussion of equity sensitivity, see below.

Declines in value are recognized as unrealized losses in AOCI.

Increases in equity markets are recognized as unrealized gains in AOCI.

Unrealized gains and losses in AOCI are amortized into the actuarial loss component of net periodic benefit cost when they exceed a threshold.

Equity Sensitivity

Investment portfolio and the assets supporting pension and other post-retirement benefit plans

The Company identifies different categories of financial risk, including liquidity, credit, interest rate, equity and foreign currency exchange, as described below.

Liquidity Risk

Liquidity risk is the risk to current or prospective earnings or capital arising from the Company's inability or perceived inability to meet its contractual funding obligations as they come due.

Sources of Liquidity Risk Sources of liquidity risk include funding risk, company-specific liquidity risk and market liquidity risk resulting from differences in the amount and timing of sources and uses of cash as well as company-specific and general market conditions.

Stressed market conditions may impact the ability to sell assets or otherwise transact business and may result in a significant loss in value.

Management The Company has defined ongoing monitoring and reporting requirements to assess liquidity across the enterprise under both current and stressed market conditions.

The Company measures and manages liquidity risk exposures and funding needs within prescribed limits across legal entities, taking into account legal, regulatory and operational limitations to the transferability of liquidity.

The Company also monitors internal and external conditions, and identifies material risk changes and emerging risks that may impact liquidity.

portfolios.

which is structured by legal entity and by counterparty and permits right of offset.

The Company has exposure to credit risk for amounts below the exposure thresholds which are uncollateralized, as well as for market fluctuations that may occur between contractual settlement periods of collateral movements.

For the company’s derivative programs, the maximum uncollateralized threshold for a derivative counterparty for a single legal entity is $10.

The Company currently transacts OTC derivatives in three legal entities that have a threshold greater than zero.

The maximum combined threshold for a single counterparty across all legal entities that use derivatives and have a threshold greater than zero is $10.

In addition, the Company may have exposure to multiple counterparties in a single corporate family due to a common credit support provider.

As of December 31, 2017, the maximum combined threshold for all counterparties under a single credit support provider across all legal entities that use derivatives and have a threshold greater than zero was $10.

Based on the contractual terms of the collateral agreements, these thresholds may be immediately reduced due to a downgrade in either party’s credit rating.

Use of Credit Derivatives

Replication

In addition, certain product liabilities expose the Company to interest rate risk, in particular short and long-term disability claim reserves.

| | Potential impact on Company's tax planning strategies and, in particular, its ability to utilize tax benefits of previously recognized realized capital losses | |

| Potential increase in Mutual Funds fee income | | |

| | | | | | | | | | | | | |

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simulation techniques in compliance with regulatory requirements.

Impact Declines in equity markets may result in losses due to sales or impairments that are recognized as realized losses in earnings or in reductions in market value that are recognized as unrealized losses in accumulated other comprehensive income ("AOCI").

Beginning in 2018, changes in the market value of equity securities will be recorded within our reported earnings.

Declines in equity markets may also decrease the value of limited partnerships and other alternative investments or result in losses

on derivatives, including on embedded product derivatives, thereby negatively impacting our reported earnings.

Actual results could

In addition, the Company holds $55 of euro-denominated cash which is hedged with foreign currency forwards.

| | | | | | | | | | | | | | | | | |

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| AA | 7,467 | | | 7,810 | | | 21.1 | % | 6,337 | | | 6,621 | | | 20.6 | % |

| A | 8,510 | | | 8,919 | | | 24.1 | % | 6,880 | | | 7,138 | | | 22.2 | % |

The fair value of securities increased, as compared to December 31, 2016, primarily due the transfer in of fixed maturities, AFS related to the acquisition of Aetna's U.S. group life and disability business as well as an increase in valuations due to

tighter credit spreads.

| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

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| Collateralized debt obligations ("CDOs") | | | | | | | | | | | | | | | | | | | | | | | | | | | | |

For U.S. exporters and other U.S. companies with international exposures, the Company covers property, marine and liability risks outside the U.S. as the assuming reinsurer under [removed: a] reinsurance [removed: agreement] [added: agreements] with [removed: a] third [removed: party.][added: parties.]

[removed: Marketing] [added: Marketing] and [removed: Distribution][added: Distribution]

[removed: Competition][added: Competition]

[removed: Small Commercial][added: Small Commercial]

The small commercial market remains highly competitive and fragmented as carriers seek to differentiate themselves through product expansion, price [removed: reduction, enhanced service and leading technology.]

The Company also [removed: has] [added: continuously enhances] digital capabilities as customers and distributors demand more [added: access and convenience, and expands product and underwriting capabilities to accommodate both larger accounts and a broader risk appetite.]

[removed: Some carriers,] [added: Existing competitors and new entrants,] including start-up and non-traditional carriers, are [added: actively] looking to expand sales of business insurance products to small [removed: commercial market insureds] [added: businesses] through [added: increasing their underwriting appetite, deepening their relationships with distribution partners, and through] on-line and direct-to-consumer marketing.

[removed: Middle Market][added: Middle Market]

Within this competitive environment, The Hartford is working to deepen its product and underwriting capabilities, [removed: and] leverage its sales and underwriting talent [removed: with tools it has introduced in recent years.][added: and expand its use of data analytics to make risk selection and pricing decisions.]

Through a [removed: partnership with AXA Corporate Solutions,] [added: business partner,] the Company offers business insurance coverages to exporters and other U.S. companies with a physical presence overseas.

[removed: Specialty Commercial][added: Specialty Commercial]

Within national accounts, the Company [removed: is implementing a phased roll out of] [added: implemented] a new risk management platform, allowing customers better access to claims data and other information needed by corporate risk managers.

This [removed: investment will allow] [added: system allows] the Company to work more closely with customers to improve long-term account performance.

In the bond business, favorable underwriting results in recent years has led to increased competition for market [removed: share, setting the stage for potential written price decreases.][added: share.]

| [removed: PERSONAL LINES] [added: PERSONAL LINES] |

[removed: 2017 Earned] [added: 2018 Earned] Premiums [removed: of $3,690 by] [added: of $3,399 by] Line of [removed: Business][added: Business]

[removed: ][added: ]

[removed: 2017 Earned] [added: 2018 Earned] Premiums [removed: of $3,690 by Product][added: of $3,399 by Product]

[removed: ][added: ]

[removed: Principal] [added: Principal] Products and [removed: Services][added: Services]

Business sold to AARP members, either direct or through independent agents, amounted to earned premiums of [removed: $3.2] [added: $3.0] billion, [removed: $3.3] [added: $3.2] billion and [removed: $3.2] [added: $3.3] billion in [removed: 2017, 2016] [added: 2018, 2017] and [removed: 2015,] [added: 2016,] respectively.

During [removed: 2017,] [added: 2018,] Personal Lines continued to refine its automobile and home product [removed: offerings, i.e., its] [added: offerings marketed under the] Open Road Auto and Home Advantage [removed: products.][added: names.]

[removed: levels, price segmentation, rating factors] and underwriting procedures were examined and updated to reflect the company’s actual experience with these products.

Through the agency channel, Personal Lines provides products and services to customers through a network of [added: independent agents in the standard personal lines market,]

[removed: independent agents in the standard personal lines market,] primarily serving mature, preferred consumers.

Most of Personal Lines' sales are associated with its exclusive licensing arrangement with AARP, with the current agreement in place through January 1, 2023, to market automobile, homeowners and personal umbrella coverages to AARP's approximately [removed: 38] [added: 37] million members, primarily direct but also through independent agents.

This relationship with AARP, which has been in place since 1984, provides Personal Lines with an important competitive advantage given the [removed: expected growth of] [added: increase in] the population of those over age 50 and the strength of the AARP brand.

The Company [removed: is investing] [added: continues to invest] in capabilities to better utilize data and analytics, and thereby, refine and manage underwriting and pricing.

| [removed: PROPERTY] [added: PROPERTY] & CASUALTY OTHER [removed: OPERATIONS] [added: OPERATIONS] |

| [removed: GROUP BENEFITS] [added: GROUP BENEFITS] |

[removed: 2017 Premiums] [added: 2018 Premiums] and Fee Income [removed: of $3,677][added: of $5,598]

[removed: ][added: ]

| Group Disability | Typically comprised of both short-term and long-term disability coverage that pays a percentage of an employee’s salary for a period of time if they are ill or injured and cannot perform the duties of their job. Short-term and long-term disability policies have elimination periods that must be satisfied prior to benefit payments. [removed: In addition to premiums, administrative service fees are paid by employers for] [added: The Company also earns fee income from] leave management [added: services] and the administration of underwriting, enrollment and claims processing for employer self-funded plans. |

In addition to employer paid coverages, [removed: Group Benefits] [added: the segment] offers voluntary product coverages which are offered through employee payroll deductions.

In addition, [removed: Group Benefits] [added: the segment] offers a single-company leave management solution, [removed: The Hartford Productivity Advantage,] which integrates work absence data from the insurer’s short-term and long-term group disability and workers’ compensation insurance with its leave management administration services.

Additionally, [removed: Group Benefits] [added: the segment] has relationships with several private exchanges which offer its products to employer groups.

The acquisition of Aetna's U.S. group life and disability business further [removed: enhances] [added: enhanced] Group Benefit's distribution footprint by increasing its sales force.

The acquisition also [removed: provides] [added: provided] Group Benefits an exclusive, multi year collaboration to sell it's group life and disability products through Aetna's medical sales team.

The relatively large size and underwriting capacity of the Group Benefits business provides a competitive advantage over smaller [removed: companies.][added: competitors.]

Group Benefits' [removed: recent] acquisition of Aetna's U.S. group life and disability business further [removed: increases] [added: increased] its market presence and

Commercial Lines written premium is generated by small commercial and middle market, which provide coverage options and customized pricing based on the policyholder’s individual risk characteristics.

On August 22, 2018, the Company entered into a definitive agreement to acquire The Navigators Group, Inc., a global specialty underwriter.

This acquisition could change the way we go to market as a commercial lines carrier.

reduction, enhanced service and leading technology.

The Hartford’s middle market business will leverage the investments in product, underwriting, and technology to better match price to individual risk as the firm pursues responsible growth strategies to deliver target returns.

Overall rate levels, price segmentation, rating factors

Marketing and Distribution

In most states, auto and home policies issued to AARP members include a lifetime continuation agreement endorsement, providing that the policies will be renewed as long as certain terms are met, such as timely payment of premium and maintaining a driver’s license in good standing.

Competition

Principal Products and Services

Marketing and Distribution

Competition

| HARTFORD FUNDS |

Principal Products and Services

| Talcott Resolution life and annuity separate accounts | Relates to assets of the life and annuity business sold in May 2018 that are still managed by the Company's Hartford Funds segment. |

Hartford Funds'

separate accounts, which relate to the life and annuity business sold in May 2018.

The Hartford Funds segment will continue to manage the mutual fund assets of Talcott Resolution, though these assets are expected to continue to decline over time.

Marketing and Distribution

Competition

Additionally, included in the Corporate category are discontinued operations from the Company's life and annuity business sold in May 2018 and a 9.7% ownership interest in the legal entity that acquired this business.

may be found in Part II, Item 7, MD&A — Critical Accounting Estimates — Property and Casualty Insurance Product Reserves.

| New Jersey | 3 | % | — | % | 2 | % | 5 | % |

through asset diversification, asset allocation limits, asset/liability duration matching and the use of derivatives.

policy forms; claims administration requirements; and maintenance of minimum rates for accumulation of surrender values.

and safekeeping of customers’ funds, corporate governance, capital, recordkeeping, and reporting requirements.

Reports filed with the SEC may be viewed at www.sec.gov.

In addition, a deterioration in global economic conditions, including due to a trade war, tariffs or other actions with respect to international trade agreements or policies, has the potential to, among other things, reduce demand for our products, reduce exposures we insure, drive higher inflation that could increase the Company’s loss costs and result in increased incidence of claims, particularly for workers’ compensation and disability claims.

| • | Credit Spread Risk - Credit spread exposure is reflected in the market prices of fixed income instruments where lower |

rated securities generally trade at a higher credit spread.

If issuer credit spreads increase or widen, the market value of our investment portfolio may decline.

If the credit spread widening is significant and occurs over an extended period of time, the Company may recognize other-than-temporary impairments, resulting in decreased earnings.

If credit spreads tighten, significantly, the Company’s net investment income associated with new purchases of fixed maturities may be reduced.

In addition, the value of credit derivatives under which the Company assumes exposure or purchases protection are impacted by changes in credit spreads, with losses occurring when credit spreads widen for assumed exposure or when credit spreads tighten if credit protection has been purchased.

For additional information on interest rate sensitivity, see Part II, Item 7 Management's Discussion and Analysis of Financial Condition and Results of Operation (MD&A), Enterprise Risk Management, Financial Risk - Interest Rate Risk.

Changing climate and weather patterns may adversely affect our business, financial condition and results of operation.

Climate change presents risks to us as an insurer, investor and employer.

Climate models indicate that rising temperatures will likely result in rising sea levels over the decades to come and may increase the frequency and intensity of natural catastrophes and severe weather events.

Extreme weather events such as abnormally high temperatures may result in increased losses associated with our property, auto, workers’ compensation and group benefits businesses.

Changing climate patterns may also increase the duration, frequency and intensity of heat/cold waves, which may result in increased claims for property damage, business interruption and losses under workers’ compensation, group disability and group life coverages.

policyholder’s individual risk characteristics.

access and convenience, and expanding product and underwriting capabilities to accommodate both larger accounts and a broader risk appetite.

The small commercial market has experienced low written premium growth rates due to current economic conditions.

Competitors seek new business by increasing their underwriting appetite, and deepening their relationships with distribution partners.

Also, carriers serving middle market-sized accounts are more aggressively competing for small commercial accounts, which are generally less price-sensitive.

Through advanced training and data analytics, the Company’s field underwriters are working to improve risk selection and pricing decisions.

The Company has also added new middle market underwriters in the Midwest and Western U.S. to deepen relationships with its distribution partners.

Overall rate

The Company has expanded its relationship with AARP to enable its members who are small business owners to purchase the Company's industry-leading small business products offered by Commercial Lines.

| MUTUAL FUNDS |

\[1\] Includes Mutual Fund Segment AUM for ETPs of $480.

| Life and annuity run-off business held for sale | Includes assets held in separate accounts classified as assets held for sale, which support legacy run-off variable insurance contracts. |

Our comprehensive range of

sale (formerly referred to as “Talcott Resolution”).

The Mutual Funds segment expects to continue managing the mutual fund assets of the life and annuity run-off business after the Company closes the sale during 2018, though those assets are expected to continue to decline over time.

The Company includes in the Corporate category discontinued operations from the Company's life and annuity run-off business accounted for as held for sale, reserves for structured settlement and terminal funding agreement liabilities retained, capital raising

Additional discussion may be found in Notes to Consolidated

legal representation for insureds where appropriate, establishment of case reserves, payment of losses and notification to reinsurers.

These laws require insurance companies, which are

States varies significantly among the countries in which The Hartford operates.

We rely on a combination of contractual rights and copyright, trademark, patent and trade secret laws to establish and protect our intellectual property.

Reports filed with the SEC may be viewed at www.sec.gov or obtained at the SEC’s Public Reference Room at 100 F Street, N.E., Washington D.C. Information regarding the operation of the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330.

Item 1A.

As noted below under “Risks Relating to the Pending Sale of Our Life and Annuity Business," the assets and liabilities of the life and annuity run-off business, consisting primarily of the operations of Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company (formerly known as Talcott Resolution), have been accounted for as held for sale as of December 31, 2017, with the operating results of that business included in discontinued operations for all periods presented.

The Company expects the sale to close by June 30, 2018, subject to regulatory approval and other closing conditions.

Apart from interest expense on debt issued and outstanding of Hartford Life, Inc., the holding company of the life and annuity run-off business, and certain tax benefits to be retained by The Hartford, the results from the discontinued operations inure to the buyer.

Accordingly, any earnings or losses of the life and annuity run-off business up until closing will not change the Company's results.

If the sale of the business does not close, we would retain the risks associated with the life and annuity run-off business.

changes in value are reported in earnings.

| • | Credit Spread Risk- Credit spread exposure is reflected in the market prices of fixed income instruments where lower rated securities generally trade at a higher credit spread. If issuer credit spreads increase or widen, the market value of our investment portfolio may decline. If the credit spread widening is significant and occurs over an extended period of time, the Company may recognize other-than-temporary impairments, resulting in decreased earnings. If credit spreads tighten, significantly, the Company’s net investment income associated with new purchases of fixed maturities may be reduced. In addition, the value of credit derivatives under which the Company assumes exposure or purchases protection are impacted by changes in credit spreads, with losses occurring when credit spreads widen for assumed exposure or, when credit spreads tighten if credit protection has been purchased. |

environmental claims is particularly difficult for insurers and reinsurers.

In addition, over time, climate change may increase the severity of certain natural catastrophe events.

| • | the potential for an increase in severity of the largest hurricane events due to higher sea surface temperatures. |

Pricing adequacy depends on a number of factors, including proper evaluation of underwriting risks, the

For

For a further discussion of potential impacts of ratings

Projecting statutory capital and the related RBC ratios is complex.

other factors, our operating results, overall financial condition, credit-risk considerations and capital requirements, as well as general business and market conditions.

and ultimate model outputs.

future taxable income and capital gains before net operating loss and capital loss carry-forwards expire.

[removed: LITIGATION][added: LITIGATION]

In [removed: addition to the matters described below,] [added: addition,] these actions include, among others, putative state and federal class actions seeking certification of a state or national class.

Like many other insurers, The Hartford also has been joined in actions by asbestos plaintiffs asserting, among other things, that insurers had a duty to protect the public from the dangers of asbestos and that [added: insurers committed unfair trade practices by asserting defenses on behalf of their policyholders in the underlying asbestos cases.]

[removed: Nonetheless, given the large or indeterminate amounts sought in certain of these actions, and the inherent unpredictability of litigation, the outcome in certain] matters could, from time to time, have a material adverse effect on the Company's results of operations or cash flows in particular quarterly or annual periods.

Part [removed: I] [added: II] - Item [removed: 3.][added: 5.]

Nonetheless, given the large or indeterminate amounts sought in certain of these actions, and the inherent unpredictability of litigation, the outcome in certain

Market for the Hartford's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

insurers committed unfair trade practices by asserting defenses on behalf of their policyholders in the underlying asbestos cases.

In addition to the inherent difficulty of predicting litigation outcomes, the Mutual Funds Litigation identified below purports to seek substantial damages for unsubstantiated conduct spanning a multi-year period based on novel applications of complex legal theories.

The alleged damages are not quantified or factually supported in the complaint, and, in any event, the Company's experience shows that demands for damages often bear little relation to a reasonable estimate of potential loss.

The application of the legal standard identified by the court for assessing the potentially available damages, as described below, is inherently unpredictable, and no legal precedent has been identified that would aid in determining a reasonable estimate of potential loss.

Accordingly, management cannot reasonably estimate the possible loss or range of loss, if any.

Mutual Funds Litigation

In February 2011, a derivative action was brought on behalf of six Hartford retail mutual funds in the United States District Court for the District of New Jersey, alleging that Hartford Investment Financial Services, LLC (“HIFSCO”), an indirect subsidiary of the Company, received excessive advisory and distribution fees in violation of its statutory fiduciary duty under Section 36(b) of the

Legal Proceedings

Investment Company Act of 1940.

During course of litigation, the claims regarding distribution fees were dismissed without prejudice, the lineup funds as plaintiffs changed several times, and the plaintiffs added as a defendant Hartford Funds Management Company (“HFMC”), an indirect subsidiary of the Company that assumed the role of advisor to the funds as of January 2013.

In June 2015, HFMC and HIFSCO moved for summary judgment, and plaintiffs cross-moved for partial summary judgment with respect to one fund.

In March 2016, the court denied the plaintiff's motion, and granted summary judgment for HIFSCO and HFMC with respect to one fund, leaving six funds and plaintiffs: The Hartford Balanced Fund, The Hartford Capital Appreciation Fund, The Hartford Floating Rate Fund, The

Hartford Growth Opportunities Fund, The Hartford Healthcare Fund and The Hartford Inflation Plus Fund.

The court further ruled that the appropriate measure of damages on the surviving claims would be the difference, if any, between the actual advisory fees paid through trial and the fees permitted under the applicable legal standard.

A bench trial on the issue of liability was held in November 2016.

In February 2017, the court granted judgment for HIFSCO and HFMC as to all claims.

Plaintiffs have appealed to the United States Court of Appeals for the Third Circuit.

[removed: UNITED STATES][added: UNITED STATES]

[removed: SECURITIES] [added: SECURITIES] AND EXCHANGE [removed: COMMISSION][added: COMMISSION]

[removed: Washington,] [added: Washington,] D.C. [removed: 20549][added: 20549]

[removed: FORM 10-K][added: FORM 10-K]

| þ | | [removed: ANNUAL] [added: ANNUAL] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the fiscal year [removed: ended December] [added: ended December] 31, [removed: 2017][added: 2018]

| o | | [removed: TRANSITION] [added: TRANSITION] REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF [removed: 1934] [added: 1934] |

[removed: For] [added: For] the transition period [removed: from to][added: from to]

[removed: Commission] [added: Commission] file number [removed: 001-13958][added: 001-13958]

[removed: ][added: ]

[removed: THE] [added: THE] HARTFORD FINANCIAL SERVICES GROUP, [removed: INC.][added: INC.]

[removed: (Exact] [added: *(Exact] name of registrant as specified in its [removed: charter)][added: charter)*]

| [removed: Delaware] [added: Delaware] | | [removed: 13-3317783] [added: 13-3317783] |

| [removed: (State] [added: *(State] or other jurisdiction of incorporation or [removed: organization)] [added: organization)*] | | [removed: (I.R.S.] [added: *(I.R.S.] Employer Identification [removed: No.)] [added: No.)*] |

[removed: One] [added: One] Hartford Plaza, Hartford, Connecticut [removed: 06155][added: 06155]

[removed: (Address] [added: *(Address] of principal executive offices) (Zip [removed: Code)][added: Code)*]

[removed: (860) 547-5000][added: (860) 547-5000]

[removed: (Registrant’s] [added: *(Registrant’s] telephone number, including area [removed: code)][added: code)*]

[removed: SECURITIES] [added: SECURITIES] REGISTERED PURSUANT TO SECTION 12 (b) OF THE [removed: ACT][added: ACT]

[removed: (ALL] [added: (ALL] OF WHICH ARE LISTED ON THE NEW YORK STOCK EXCHANGE [removed: INC.):][added: INC.):]

[removed: SECURITIES] [added: SECURITIES] REGISTERED PURSUANT TO SECTION 12 (g) OF THE [removed: ACT:][added: ACT:]

| [removed: Indicate] [added: Indicate] by check [removed: mark:] [added: mark:] | | [removed: Yes] [added: Yes] | [removed: No] [added: No] |

| [removed: •] [added: •] | if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. | þ | |

| [removed: •] [added: •] | if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Exchange Act. | | þ |

| [removed: •] [added: •] | whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. | þ | |

| [removed: •] [added: •] | whether the registrant has submitted electronically [removed: and posted on its corporate Web site, if any,] every Interactive Data File required to be submitted [removed: and posted] pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit [removed: and post] such files). | þ | |

| [removed: •] [added: •] | if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. | þ | |

| [removed: •] [added: •] | whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act. | | |

| [removed: •] [added: •] | whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.) | | þ |

The aggregate market value of the shares of Common Stock held by non-affiliates of the registrant as of June [removed: 30, 2017] [added: 29, 2018] was approximately [removed: $19] [added: $18] billion, based on the closing price of [removed: $52.57] [added: $51.13] per share of the Common Stock on the New York Stock Exchange on June [removed: 30, 2017.][added: 29, 2018.]

As of February [removed: 21, 2018,] [added: 20, 2019,] there were outstanding [removed: 356,981,387] [added: 359,470,401] shares of Common Stock, $0.01 par value per share, of the registrant.

[removed: Documents] [added: Documents] Incorporated by [removed: Reference][added: Reference]

Portions of the registrant’s definitive proxy statement for its [removed: 2018] [added: 2019] annual meeting of [removed: shareholders] [added: stockholders] are incorporated by reference in Part III of this Form 10-K.

[removed: ANNUAL] [added: ANNUAL] REPORT ON FORM [removed: 10-K][added: 10-K]

[removed: TABLE] [added: TABLE] OF [removed: CONTENTS][added: CONTENTS]

[removed: | 1 | [BUSINESS](#s96AC689EB93057BF9A42F1D9988C54CB) | [6](#s96AC689EB93057BF9A42F1D9988C54CB) |][added: BUSINESS]

| 1A. | [RISK [removed: FACTORS](#sD69EBAA6088F54699D1A0A6EDAEA9AF0)] [added: FACTORS](#sA3F622B6CF8A5625BAA75538615A695C)] | [removed: [17](#sD69EBAA6088F54699D1A0A6EDAEA9AF0)] [added: [17](#sA3F622B6CF8A5625BAA75538615A695C)] |

| 1B. | [UNRESOLVED STAFF [removed: COMMENTS](#sD795852316C9592E9F2AF6196BD7D741)] [added: COMMENTS](#sC82A417A8FDA5768A4CFD0E4F3FAF31B)] | None |

| 3 | [LEGAL [removed: PROCEEDINGS](#sD277FAB29D465EB1BCFA9AD203609903)] [added: PROCEEDINGS](#sCFA754698ECD5161B9CC28912DC59421)] | [removed: [28](#sD277FAB29D465EB1BCFA9AD203609903)] [added: [28](#sCFA754698ECD5161B9CC28912DC59421)] |

| 4 | [MINE SAFETY [removed: DISCLOSURES](#sC081BF64832C59649FF705C66D64DE12)] [added: DISCLOSURES](#sE2025FFAED5A5F08B0114B24BAE3981E)] | Not Applicable |

or

Depositary Shares, Each Representing a 1/1,000th Interest in a Share of 6.000% Non-Cumulative Preferred Stock, Series G, par value $0.01 per share

THE HARTFORD FINANCIAL SERVICES GROUP, INC.

FOR THE FISCAL YEAR ENDED DECEMBER 31, 2018

| | [Part I](#s1923C6D74FEF5CF8B73D22B1ACF89752) | |

| 2 | [PROPERTIES](#sB9164E363A2159FDB3448FEF25B5D5CD) | [28](#sB9164E363A2159FDB3448FEF25B5D5CD) |

| | [Part II](#s09B92B308108565A8BEFE99DC8A061E9) | |

| | [Part IV](#sC71D8A42474B55CD9DF5CEF7155830D1) | |

| | [SIGNATURES](#s08BAFBA6D70D5AEEA6021C49026AC0D5) | [I-4](#s08BAFBA6D70D5AEEA6021C49026AC0D5) |

| ◦ | the impacts of changing climate and weather patterns on our businesses, operations and investment portfolio including on claims, demand and pricing of our products, the availability and cost of reinsurance, our modeling data used to evaluate and manage risks of catastrophes and severe weather events, the value of our investment portfolios and credit risk with reinsurers and other counterparties; |

| ◦ | the risks associated with the change in or replacement of the London Inter-Bank Offered Rate ("LIBOR") on the securities we hold or may have issued, other financial instruments and any other assets and liabilities whose value is tied to LIBOR; |

| ◦ | losses due to nonperformance or defaults by others, including credit risk with counterparties associated with investments, derivatives, premiums receivable, reinsurance recoverables and indemnifications provided by third parties in connection with previous dispositions; |

| ◦ | the potential for further impairments of our goodwill or the potential for changes in valuation allowances against deferred tax assets; |

| ◦ | failure to complete our proposed acquisition of The Navigators Group, Inc. may cause volatility in our securities; |

| ◦ | risks associated with acquisitions and divestitures including the challenges of integrating acquired companies or businesses or separating from our divested businesses that may result in our not being able to achieve the anticipated benefits and synergies and may result in unintended consequences; |

| ◦ | difficulty in attracting and retaining talented and qualified personnel including key employees, such as executives, managers and employees with strong technological, analytical and other specialized skills; |

Corporate also includes investment management fees and expenses related to managing third party business, including management of the invested assets of Talcott Resolution Life, Inc. and its subsidiaries ("Talcott Resolution").

sold in May 2018.

In addition, Corporate includes a 9.7% ownership interest in the legal entity that acquired the life and annuity business sold.

2018 Revenues of $18,955 \[1\] by Segment

United States.

The majority of

10-K 1 hig1231201710-kdocument.htm 10-K

or

| | [Part I](#sCA406B5C745A538586BA7BAD8D7118D3) | |

| 2 | [PROPERTIES](#sF1D0D2262E5D540EA76455159E1FB21D) | [28](#sF1D0D2262E5D540EA76455159E1FB21D) |

| | [Part II](#s734CE06A5B0051F39FC551A929D3C8FD) | |

| | [Part IV](#s1C545013AA03549C967296D22EAB0977) | |

| | [SIGNATURES](#sA6087A256B565E85B4C19609AD99F80E) | [I-5](#sA6087A256B565E85B4C19609AD99F80E) |

| | |

| --- | --- |

| ◦ | financial risk related to the continued reinvestment of our investment portfolios; |

| ◦ | the impact on our investment portfolio if our investment portfolio is concentrated in any particular segment of the economy; |

| ◦ | losses due to nonperformance or defaults by others, including sourcing partners, derivative counterparties and other third parties; |

| ◦ | the risks related to the Company's ability to close its previously announced sale of its life and annuity run-off book of business, which is subject to several closing conditions, including many that are outside of the Company's control; |

| ◦ | the risks related to political, economic and global economic conditions, including interest rate, equity and credit spread risks; |

| ◦ | risks related to negative rating actions or downgrades in the financial strength and credit ratings of Hartford Life Insurance Company or Hartford Life and Annuity Insurance Company or negative rating actions or downgrades relating to our investments; |

| ◦ | the volatility in our statutory and United States ("U.S.") Generally Accepted Accounting Principles ("GAAP") earnings and potential material changes to our results resulting from our risk management program to emphasize protection of economic value; |

| ◦ | the potential for losses due to our reinsurers’ unwillingness or inability to meet their obligations under reinsurance contracts; |

| ◦ | the potential for differing interpretations of the methodologies, estimations and assumptions that underlie the fair value estimates for investments and the evaluation of other-than-temporary impairments on available for sale securities; |

| ◦ | the potential for further acceleration of deferred policy acquisition cost amortization and an increase in reserves for certain guaranteed benefits in our variable annuities; |

| ◦ | changes in federal or state tax laws that would impact the tax-favored status of life and annuity contracts; and |

| ◦ | changes in accounting and financial reporting of the liability for future policy benefits, including how the life and annuity businesses account for deferred acquisition costs and market risk benefits on variable annuity contracts and the discounting of life contingent fixed annuities. |

In December 2017, the Company announced the signing of a definitive agreement to sell its life and annuity operating subsidiaries and, accordingly, the assets and liabilities of those subsidiaries have been presented as held for sale with results of operations from that business reflected as discontinued operations.

See Note 20 - Business Dispositions and Discontinued Operations of Notes to Consolidated Financial Statements.

2017 Revenues of $16,974 \[1\] by Segment

In addition, the specialty line of business provides

The majority of Commercial Lines written premium is generated by small commercial and middle market, which provide coverage options and customized pricing based on the

As of December 31, [removed: 2017,] [added: 2018,] The Hartford owned building space of approximately 1.8 million square feet which comprised its Hartford, Connecticut location and other properties within the greater Hartford, Connecticut area.

In addition, as of December 31, [removed: 2017,] [added: 2018,] The Hartford leased approximately [removed: 1.7] [added: 1.5] million square feet, throughout the United States of America, and

approximately two thousand square [removed: feet,] [added: feet] in [removed: other countries.][added: Canada.]

For more information on reporting segments, see Part I, Item 1, Business [removed: —] Reporting Segments.

As of February 21, [removed: 2018,] [added: 2019,] the Company had approximately [removed: 11,641] [added: 11,146] registered holders of record of the Company's common stock.

On June [removed: 12, 2017,] [added: 1, 2018,] the Company’s Chief Executive Officer certified to the NYSE that he is not aware of any violation by the Company of NYSE corporate governance listing standards, as required by Section 303A.12(a) of the NYSE’s Listed Company Manual.

There are [removed: also] various legal and regulatory limitations governing the extent to which The Hartford’s insurance subsidiaries may [added: extend credit, pay dividends or otherwise provide funds to The Hartford Financial Services Group, Inc. as discussed in the Liquidity Requirements and Sources of Capital section of Part II, Item 7, MD&A — Capital Resources and Liquidity.]

[removed: Total] [added: Total] Return to [removed: Shareholders][added: Stockholders]

| [removed: Annual] [added: Annual] Return [removed: Percentage] [added: Percentage] | | | | | | | | | | |

| | [removed: For] [added: For] the years [removed: ended] [added: ended] | | | | | | | | | |

| [removed: Company/Index] [added: Company/Index] | [removed: 2013] [added: 2013] | | [removed: 2014] | [added: 2014] | [removed: 2015] | [added: 2015] | [removed: 2016] | [added: 2016] | [removed: 2017] | [added: 2017] | [added: | 2018 | |]

| [removed: The] [added: The] Hartford Financial Services Group, [removed: Inc. | 64.12 | %] [added: Inc.] | 17.13 | % | 6.12 | % | 11.76 | % | 20.26 | % | [added: (19.24 | %) |]

| [removed: S&P] [added: S&P] 500 [removed: Index | 32.39 | %] [added: Index] | 13.69 | % | 1.38 | % | 11.96 | % | 21.83 | % | [added: (4.38 | %) |]

| [removed: S&P] [added: S&P] Insurance Composite [removed: Index | 46.71 | %] [added: Index] | 8.29 | % | 2.33 | % | 17.58 | % | 16.19 | % | [added: (11.21 | %) |]

| [removed: Cumulative] [added: Cumulative] Five-Year Total [removed: Return] [added: Return] | | | | | | | | | | | | | |

| | [removed: Base] [added: Base] | | | | | | | | | | | | |

| | [removed: Period] [added: Period] | | | [removed: For] [added: For] the years [removed: ended] [added: ended] | | | | | | | | | |

| [removed: Company/Index | 2012 | |] [added: Company/Index] | [removed: 2013] [added: 2014] | | [removed: 2014] [added: 2015] | | [removed: 2015] [added: 2016] | | [removed: 2016] [added: 2017] | | [removed: 2017] [added: 2018] | |

| [removed: The] [added: The] Hartford Financial Services Group, [removed: Inc.] [added: Inc.] | $ | 100 | | [removed: 164.12] [added: 117.13] | | [removed: 192.24] [added: 124.30] | | [removed: 204.00] [added: 138.92] | | [removed: 227.99] [added: 167.06] | | [removed: 274.18] [added: 134.92] | |

[removed: ][added: ]

During the year ended December 31, 2018, the Company did not repurchase any common shares.

In February, 2019, the Company announced a $1.0 billion share repurchase authorization by the Board of Directors which is effective through December 31, 2020.

Based on projected holding company resources, the Company expects to use a portion of the authorization in 2019 but anticipates using the majority of the program in 2020.

Any repurchase of shares under the equity repurchase program is dependent on market conditions and other factors.

| S&P 500 Index | $ | 100 | | 113.69 | | 115.26 | | 129.05 | | 157.22 | | 150.33 | |

| S&P Insurance Composite Index | $ | 100 | | 108.29 | | 110.81 | | 130.29 | | 151.38 | | 134.42 | |

High and Low Closing Prices and Quarterly Dividends Declared per Share for the Common Stock of The Hartford

| | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | 1st Qtr. | | | 2nd Qtr. | | | 3rd Qtr. | | | 4th Qtr. | | |

| 2017 | | | | | | | | | | | | |

| Common Stock Price | | | | | | | | | | | | |

| High | $ | 49.87 | | $ | 52.75 | | $ | 56.81 | | $ | 57.65 | |

| Low | $ | 47.05 | | $ | 47.26 | | $ | 51.64 | | $ | 54.06 | |

| Dividends Declared | $ | 0.23 | | $ | 0.23 | | $ | 0.23 | | $ | 0.25 | |

| 2016 | | | | | | | | | | | | |

| High | $ | 46.31 | | $ | 46.80 | | $ | 44.77 | | $ | 48.58 | |

| Low | $ | 37.63 | | $ | 40.98 | | $ | 39.85 | | $ | 42.50 | |

| Dividends Declared | $ | 0.21 | | $ | 0.21 | | $ | 0.21 | | $ | 0.23 | |

On February 22, 2018, The Hartford’s Board of Directors declared a quarterly dividend of $0.25 per common share payable on April 2, 2018 to common shareholders of record as of March 5, 2018.

The closing price of The Hartford’s common stock on the NYSE on February 21, 2018 was $53.95.

extend credit, pay dividends or otherwise provide funds to The Hartford Financial Services Group, Inc. as discussed in the Liquidity Requirements and Sources of Capital section of Part II, Item 7, MD&A — Capital Resources and Liquidity.

During the period October 1, 2017 through October 13, 2017, the Company repurchased 0.9 million common shares at an average price of $55.70 per share.

All 0.9 million shares were purchased as part of publicly announced plans or programs.

Effective October 13, 2017, the Company suspended 2017 equity repurchases.

The Company does not currently expect to authorize an equity repurchase plan in 2018.

| S&P 500 Index | $ | 100 | | 132.39 | | 150.51 | | 152.59 | | 170.84 | | 208.14 | |

| S&P Insurance Composite Index | $ | 100 | | 146.71 | | 158.86 | | 162.56 | | 191.15 | | 222.09 | |

| [removed: in] [added: *(In] millions, except per share [removed: data] [added: data)*] | [removed: 2017] [added: 2018] | | | [removed: 2016] [added: 2017] | | | [removed: 2015] [added: 2016] | | | [removed: 2014] [added: 2015] | | | [removed: 2013] [added: 2014] | | |

| [removed: Income] [added: Income] Statement [removed: Data] [added: Data] | | | | | | | | | | | | | | | |

| Income from continuing operations before income taxes | $ | [removed: 723] [added: 1,753] | | $ | [removed: 447] [added: 723] | | $ | [removed: 1,478] [added: 447] | | $ | [removed: 1,232] [added: 1,478] | | $ | [removed: 987] [added: 1,232] | |

| [removed: (Loss)] Income [added: (loss)] from continuing operations, net of tax | $ | [added: 1,485 | | $ |] (262 | ) | $ | 613 | | $ | 1,189 | | $ | 925 | | [removed: $ | 759 | |]

| [removed: (Loss)] Income [added: (loss)] from discontinued operations, net of tax | $ | [added: 322 | | $ |] (2,869 | ) | $ | 283 | | $ | 493 | | $ | (127 | ) | [removed: $ | (583 | ) |]

| Net [removed: (loss)] income [added: (loss)] | $ | [added: 1,807 | | $ |] (3,131 | ) | $ | 896 | | $ | 1,682 | | $ | 798 | | [removed: $ | 176 | |]

| [removed: Balance] [added: Balance] Sheet [removed: Data] [added: Data] | | | | | | | | | | | | | | | |

| Total assets | $ | [removed: 225,260] [added: 62,307] | | $ | [removed: 224,576] [added: 225,260] | | $ | [removed: 229,616] [added: 224,576] | | $ | [removed: 245,566] [added: 229,616] | | $ | [removed: 278,339] [added: 245,566] | |

| Short-term debt | $ | [removed: 320] [added: 413] | | $ | [removed: 416] [added: 320] | | $ | [removed: 275] [added: 416] | | $ | [removed: 456] [added: 275] | | $ | [removed: 438] [added: 456] | |

| Total debt (including capital lease obligations) | $ | [removed: 4,998] [added: 4,678] | | $ | [removed: 4,910] [added: 4,998] | | $ | [removed: 5,216] [added: 4,910] | | $ | [removed: 5,966] [added: 5,216] | | $ | [removed: 6,401] [added: 5,966] | |

| Total stockholders’ equity | $ | [removed: 13,494] [added: 13,101] | | $ | [removed: 16,903] [added: 13,494] | | $ | [removed: 18,024] [added: 16,903] | | $ | [removed: 19,130] [added: 18,024] | | $ | [removed: 19,217] [added: 19,130] | |

| [removed: Net (loss) income per common share | | | | | | | | | | | | |] [added: Net Income (Loss) Available to Common Stockholders] | [added: Net Income (Loss) Available to Common Stockholders per Diluted Share] | [added: Book Value per Diluted Share] |

| [removed: Cash] [added: Cash] dividends declared per common [removed: share] [added: share] | $ | [removed: 0.94] [added: 1.10] | | $ | [removed: 0.86] [added: 0.94] | | $ | [removed: 0.78] [added: 0.86] | | $ | [removed: 0.66] [added: 0.78] | | $ | [removed: 0.50] [added: 0.66] | |

[removed: Item] [added: Item] 7.

[removed: (Dollar] [added: *(Dollar] amounts in millions, except for per share data, unless otherwise [removed: stated)][added: stated)*]

On [removed: December 3, 2017,] [added: May 31, 2018,] Hartford Holdings, Inc., a wholly owned subsidiary of the Company, [removed: entered into a definitive agreement to sell all] [added: completed the sale] of the issued and outstanding equity of Hartford Life, Inc. (“HLI”), a holding company, and its life and annuity operating subsidiaries.

On May 10, 2017, the Company completed the sale of its U.K. [removed: property and casualty run-off subsidiaries.]

Lattice's revenue and earnings since the acquisition date are included in the operating results of the Company's [removed: Mutual] [added: Hartford] Funds reporting segment.

[added: For discussion of] these transactions, see Note 2 - Business Acquisitions of Notes to Consolidated Financial Statements.

[removed: Index][added: Index]

| [removed: Description] [added: Description] | [removed: Page] [added: Page] |

[removed: | Key Performance Measures and Ratios | [33](#s1913917B79B95F4083DC43B333BC0BF5) |][added: KEY PERFORMANCE MEASURES AND RATIOS]

[removed: | The Hartford's Operations | [36](#s14856CA17ECE514AA249827585468EBD) |][added: THE HARTFORD'S OPERATIONS]

[removed: | Consolidated Results of Operations | [39](#sE460B17F90DB50FDAA4973E90CF22E06) |][added: CONSOLIDATED RESULTS OF OPERATIONS]

[removed: | Investment Results | [42](#s3A1C34CE0DA35E5C8A57CFD5105EF6E7) |][added: INVESTMENT RESULTS]

[removed: | Critical Accounting Estimates | [44](#sC7644B04B17C5C09A9158C88F73AB0EF) |][added: CRITICAL ACCOUNTING ESTIMATES]

| Commercial Lines | [removed: [65](#s013354A0D756598D99F6D05127E78A1C)] [added: [65](#sE19C4897B1FE5166B96278992DA33BAE)] |

| [removed: Personal Lines | [69](#sFA91F3345B525CDFA31B6A327F97EE83)] [added: PERSONAL LINES] |

[removed: | [Property] [added: Property] & Casualty Other [removed: Operations](#s70B15A19D7FF54349374D3D787201DC1) | [73](#s70B15A19D7FF54349374D3D787201DC1) |][added: Operations]

| [removed: Group Benefits | [75](#s87B22456EE8D5140977DD0296AE31511)] [added: GROUP BENEFITS] |

| [removed: [Corporate](#s2A24BF7AD3D95A27BD7E503EFDAF9F90) | [79](#s2A24BF7AD3D95A27BD7E503EFDAF9F90)] [added: CORPORATE] |

[removed: | [Enterprise Risk Management](#s813963198B775ED5980E124CD82BE618) | [81](#s813963198B775ED5980E124CD82BE618) |][added: ENTERPRISE RISK MANAGEMENT]

| [Capital Resources and [removed: Liquidity](#s643AEF1ED342575E937BD93EB3D715C6)] [added: Liquidity](#s2D6840226B68551ABD8994EFB5E6D988)] | [removed: [97](#s643AEF1ED342575E937BD93EB3D715C6)] [added: [99](#s2D6840226B68551ABD8994EFB5E6D988)] |

| [Impact of New Accounting [removed: Standards](#sF7704EC4203553E6916C92737E6D4CC0)] [added: Standards](#s8D574595684256C3A363EE3A43F3DD1F)] | [removed: [107](#sF7704EC4203553E6916C92737E6D4CC0)] [added: [107](#s8D574595684256C3A363EE3A43F3DD1F)] |

[removed: KEY PERFORMANCE MEASURES AND RATIOS][added: | Key Performance Measures and Ratios | [33](#s0194AE4B260A53DE883EC19473AE83B8) |]

[removed: Definitions] [added: Definitions] of Non-GAAP and Other Measures and [removed: Ratios][added: Ratios]

[removed: Assets] [added: Assets] Under Management [removed: (“AUM”)-] [added: (“AUM”)-] include mutual fund and [removed: ETP] [added: exchange-traded products ("ETP")] assets.

AUM is a measure used by the [removed: Company] [added: Company's Hartford Funds segment] because a significant portion of the Company’s mutual fund [added: and ETP] revenues are based upon asset values.

[removed: Book] [added: Book] Value per Diluted [removed: Share-] [added: Share] excluding [removed: AOCI,] [added: accumulated other comprehensive income ("AOCI")-] is calculated based upon a non-GAAP financial measure.

It is calculated by dividing (a) [removed: total] [added: common] stockholders' equity, excluding AOCI, after tax, by (b) common shares outstanding and dilutive potential common shares.

| Total revenues | $ | 18,955 | | $ | 17,162 | | $ | 16,291 | | $ | 16,187 | | $ | 15,905 | |

| Income (loss) from continuing operations, net of tax, available to common stockholders | $ | 1,479 | | $ | (262 | ) | $ | 613 | | $ | 1,189 | | $ | 925 | |

| Preferred stock | $ | 334 | | $ | — | | $ | — | | $ | — | | $ | — | |

| Basic | $ | 4.13 | | $ | (0.72 | ) | $ | 1.58 | | $ | 2.86 | | $ | 2.09 | |

| Diluted | $ | 4.06 | | $ | (0.72 | ) | $ | 1.55 | | $ | 2.80 | | $ | 2.01 | |

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

On August 22, 2018, the Company announced it entered into a definitive agreement to acquire all outstanding common shares of The Navigators Group, Inc. ("Navigators Group"), a global specialty underwriter, for $70 a share, or $2.1 billion in cash.

The transaction is expected to close in late March or April 2019, subject to customary closing conditions, including receipt of regulatory approvals.

On February 16, 2018, The Hartford entered into a renewal rights agreement with the Farmers Exchanges, of the Farmers Insurance Group of Companies, to acquire its Foremost-branded small commercial business sold through independent agents.

Written premium from this agreement began in the third quarter of 2018.

property and casualty run-off subsidiaries.

Distribution costs within the Hartford Funds segment that were previously netted against fee income are presented gross in insurance operating costs and other expenses.

| Consolidated Results of Operations | [39](#sBEA408347E705FE0B49BD89915A32224) |

| Hartford Funds | [78](#s3200B4B142A952B095EA2BB881FD9C51) |

Core earnings are net of preferred stock dividends declared since they are a cost of financing more akin to interest expense on debt and are expected to be a recurring expense as long as the preferred stock is outstanding.

Net income (loss), net income (loss) available to common stockholders and income (loss) from continuing operations, net of tax, available to common stockholders are the most directly comparable U.S. GAAP measures to core earnings.

| Preferred stock dividends | 6 | | | — | | | — | | |

| Net income (loss) available to common stockholders | 1,801 | | | $ | (3,131 | ) | $ | 896 | |

Therefore, the growth in assets

twelve months for substantially all of the remainder of the Company’s Property and Casualty business.

unpredictable catastrophe losses and prior accident year loss and loss adjustment expense reserve development.

In addition, Corporate includes a 9.7% ownership interest in the legal entity that acquired the life and annuity business sold in May 2018.

Company’s products could prove to be inadequate if loss and expense trends emerge adversely during the rate guarantee period.

Net flows are

The change from net loss in 2017 to a net income in 2018 was primarily due to a number of charges in 2017, including a $3.3 billion loss on the life and annuity business sold in May 2018, net of tax, $877 of income tax expense primarily from reducing net deferred tax assets due to the reduction of the corporate Federal income tax rate, and the effect of a pension settlement charge of $488, net of tax.

Apart from these charges in 2017, net income available to common stockholders increased, driven by higher net income in Commercial Lines, Group Benefits and Hartford Funds that was partially attributable to a lower corporate Federal income tax rate in 2018.

Book value per diluted common share decreased to $35.06 from $37.11 as of December 31, 2017 as a result of a 5% decrease in common stockholders' equity resulting primarily from a decrease in AOCI over the period, partially offset by net income in excess of stockholder dividends.

Net investment income increased 11% to $1,780 compared with the prior year primarily due to higher average fixed maturities asset levels during 2018 as compared to 2017 largely driven by the acquisition of Aetna's U.S. group life and disability business in November 2017 and, to a lesser extent, higher income from partnerships and other alternative investments and a higher reinvestment rate on fixed maturities.

Net realized capital gains (losses) changed to net losses of $112 from net gains of $165 for the year ended December 31, 2017, with losses in 2018 primarily driven by net losses on sales of fixed maturity securities due to sector repositioning and duration, liquidity and credit management as well as net losses on equity securities resulting from depreciation in value due to lower equity market levels, partially offset by gains on sales due to tactical repositioning.

Annualized investment yield, after tax of 3.3%, was up 30 basis points from 2017 primarily due to the effect of a lower corporate Federal income tax rate.

Net unrealized gains, after tax for fixed maturities in the investment portfolio decreased by $2,180 compared with the prior year primarily due to the effect of credit spread widening and higher interest rates and the removal of AOCI related to the life and annuity business sold in May 2018.

Combined ratio for Property & Casualty decreased 2.2 points to 97.8 compared with a combined ratio of 100.0 for 2017 largely due to a lower current accident year loss and loss adjustment expense ratio for Personal Lines and favorable prior accident year development, partially offset by higher expenses.

Catastrophe losses of $821, before tax, decreased from catastrophe losses of $836, before tax, in the prior year, with catastrophes in both years including losses from California wildfires, hurricanes, winter storms and various wind and hail events.

Prior accident year development for property and casualty was a net favorable $167, before tax, in 2018 primarily due to a decrease in reserves for workers' compensation, automobile liability and 2017 catastrophes, partially offset by an increase in reserves for general liability.

Reserve development was a net favorable $41, before tax, in 2017 primarily due to a decrease in reserves for workers compensation and package business, partially offset by a reserve increase for customs bond claims.

Net income margin for Group Benefits declined from 7.2% in 2017 to 5.6% in 2018 primarily due to net realized capital losses of $39, net of tax, in 2018 as compared to net realized capital gains of $19, net of tax, in 2017, integration costs of $37, net of tax, in 2018 as compared to $11, net of tax, in 2017, and a tax benefit of $52 in 2017 from reducing net deferred tax liabilities due to the lower corporate income tax rate, partially offset by an increase in favorable prior incurral year development on long-term disability and premium waiver primarily due to favorable incidence trends and the effect of scale from the acquisition of Aetna’s U.S. group life and disability business on fixed expenses.

Prior accident year development, pre-tax, for Group Benefits increased from $185 in 2017 to $324 in 2018 with most of that development from the 2017 incurral year as incidence trends become known after the elimination period is satisfied.

| Fee income \[1\] | 1,313 | | | 1,168 | | | 1,041 | | | 145 | | | 127 | | |

| Total revenues | 18,955 | | | 17,162 | | | 16,291 | | | 1,793 | | | 871 | | |

| Total benefits, losses and expenses | 17,202 | | | 16,439 | | | 15,844 | | | 763 | | | 595 | | |

| | | | | | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| Total revenues | $ | 16,974 | | $ | 16,107 | | $ | 15,997 | | $ | 15,713 | | $ | 15,966 | |

| Basic | $ | (8.61 | ) | $ | 2.31 | | $ | 4.05 | | $ | 1.81 | | $ | 0.37 | |

| Diluted | $ | (8.61 | ) | $ | 2.27 | | $ | 3.96 | | $ | 1.73 | | $ | 0.36 | |

For discussion of

Fee income from installment fees reported by the Commercial Lines and Personal Lines reporting segments has been reclassified from underwriting expenses to fee income and included in total revenues.

The reclassification of installment fees did not impact previously reported underwriting gain (loss), underwriting ratios, or net income (loss) either in the Commercial Lines or Personal Lines reporting segments and did not impact previously reported consolidated net income or core earnings.

Separately, the flood servicing business has been realigned from specialty commercial within the Commercial Lines reporting segment to the Personal Lines reporting segment.

This realignment did not materially impact previously reported Commercial Lines or Personal Lines underwriting results or net income.

The realignment of the flood servicing business did not impact previously reported consolidated net income or core earnings.

Assets and liabilities associated with the Company's life and annuity run-off business are now classified as held for sale.

Unpaid losses and loss adjustment expenses and reinsurance recoverables for structured settlements reserves and recoverables due from the Company's life and annuity run-off business now classified as held for sale have been reclassified into the Company's P&C commercial lines business.

Annuities purchased from third-party life insurers under structured settlements, including from life and annuity run-off obligations held for sale, are recognized as reinsurance recoverables in cases where the Company has not obtained a release from the claimant.

These amounts were previously eliminated in consolidation.

Policy loans have been reclassified to Other investments on the Consolidated Balance Sheets.

Other intangible assets have been reclassified out of Other assets on the Consolidated Balance Sheets into their own line item.

Likewise, amortization of intangible assets has been reclassified out of Insurance operating costs and other expenses on the Consolidated Statements of Operations into their own line item.

| | |

| --- | --- |

| [Mutual Funds](#sA5C5186A3A13589DB12C4D2B38336E6F) | [77](#sA5C5186A3A13589DB12C4D2B38336E6F) |

The Company believes it is useful to investors

| Less: Restructuring and other costs, before tax | — | | | — | | | (20 | | ) |

Conversely, either

considerations, excluding buyout premiums.

renewal earned price increases (decreases) lag renewal written price increases (decreases) by six to twelve months.

A reconciliation of

Casualty Other Operations, Group Benefits, and Mutual Funds, as well as a Corporate category.

business.

priced with the assumption that premiums received can be invested for a period of time before benefits, loss and loss adjustment expenses are paid.

| Net (Loss) Income | Net Income (Loss) per Diluted Share | Book Value per Diluted Share |

Common share repurchases during 2017 totaled $1,028 million, or 20.2 million shares and $341 of dividends were paid to shareholders.

Book value per diluted common share decreased to $37.11 from $44.35 as of December 31, 2016 as a result of a $3.4 billion, or 20%, decrease in shareholders' equity largely due to a $3.3 billion loss on the pending sale of the life and annuity run-off business, partially offset by the effect of a 5% decrease in common shares outstanding and dilutive potential common shares.

Annualized investment yield, after-tax of 3.0%, was up 0.1 points from 2016 as the effect of higher returns on limited partnerships and alternative investments was partially offset by the effect of lower make-whole payment income and reinvesting at lower yields.

Net unrealized gains, after-tax, in the investment portfolio increased by $655 compared with the prior year due primarily to tighter credit spreads.

Combined ratio of 100.0 compared with 100.1 in the prior year for Property & Casualty, as a higher combined ratio in Commercial Lines was largely offset by the effect of asbestos and environmental reserve strengthening in P&C Other Operations in 2016 and modest improvement in the Personal Lines combined ratio.

Catastrophe losses of $836, before tax, increased from catastrophe losses of $416, before tax, in the prior year, largely due to losses in 2017 from hurricanes Harvey and Irma and wildfires in California.

| Fee income \[1\] | 980 | | | 857 | | | 876 | | | 123 | | | (19 | | ) |

| Total revenues | 16,974 | | | 16,107 | | | 15,997 | | | 867 | | | 110 | | |

| Total benefits, losses and expenses | 16,251 | | | 15,660 | | | 14,519 | | | 591 | | | 1,141 | | |

[removed: Report] [added: Report] of Independent Registered Public Accounting [removed: Firm][added: Firm]

[removed: Opinion] [added: Opinion] on Internal Control over Financial [removed: Reporting][added: Reporting]

We have audited the internal control over financial reporting of The Hartford Financial Services Group, Inc. and its subsidiaries (collectively, the "Company") as of December 31, [removed: 2017,] [added: 2018,] based on criteria established in [removed: Internal] [added: *Internal] Control - Integrated Framework [removed: (2013)] [added: (2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, [removed: 2017,] [added: 2018,] based on criteria established in [removed: Internal] [added: *Internal] Control - Integrated Framework [removed: (2013)] [added: (2013)*] issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended December 31, [removed: 2017,] [added: 2018,] of the Company and our report dated February [removed: 23, 2018,] [added: 22, 2019,] expressed an unqualified opinion on those financial statements.

[removed: Basis] [added: Basis] for [removed: Opinion][added: Opinion]

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in [added: the accompanying] Management’s Annual Report on Internal Control over Financial Reporting.

[removed: Definition] [added: Definition] and Limitations of Internal Control over Financial [removed: Reporting][added: Reporting]

February 22, 2019

As described in Management’s Annual Report on Internal Control over Financial Reporting, management excluded from its assessment the internal control over financial reporting of Aetna's U.S. group life and disability business, which was acquired on November 1, 2017 and whose financial statements constitutes 2.4% of total assets and 2.2% of revenues of the consolidated financial statements of the Company as of and for the year ended December 31, 2017.

Accordingly, our audit did not include the internal control over financial reporting at the acquired business.

February 23, 2018

Certain of the information called for by Item 10 will be set forth in the definitive proxy statement for the [removed: 2018] [added: 2019] annual meeting of [removed: shareholders] [added: stockholders] (the “Proxy Statement”) to be filed by The Hartford with the Securities and Exchange Commission within 120 days after the end of the fiscal year covered by this Form 10-K under the captions and subcaptions “Board and Governance Matters”, “Director Nominees" and "Section (16)(a) Beneficial Ownership Reporting Compliance" and is incorporated herein by reference.

[removed: Executive] [added: Executive] Officers of The [removed: Hartford][added: Hartford]

Set forth below is information about the other executive officers of the Company as of February 15, [removed: 2018:][added: 2019:]

| [removed: Name] [added: Name] | [removed: Age] [added: Age] | [removed: Position] [added: Position] with The Hartford and Business Experience For the Past Five [removed: Years] [added: Years] |

| William A. Bloom | [removed: 54] [added: 55] | Executive Vice President of Operations and Technology (August 2014 - present); President of Global Client Services, EXL (July 2010-July 2014) |

| Beth A. [removed: Bombara] [added: Costello] | [removed: 50] [added: 51] | Executive Vice President and Chief Financial Officer (July 2014-present); President of [added: the life and annuity business sold in May 2018 and formerly referred to as] Talcott Resolution (July 2012-July 2014) |

| [removed: Kathy] [added: Kathleen M.] Bromage | [removed: 60] [added: 61] | Chief Marketing and Communications Officer (June 2015-present); Senior Vice President of Strategy and Marketing, Small Commercial and Senior Vice President of Brand Marketing (July 2012-June 2015) |

| [removed: Doug] [added: Douglas G.] Elliot | [removed: 57] [added: 58] | President (July 2014-present); Executive Vice President and President of Commercial Lines (April 2011-July 2014) |

| Martha Gervasi | [removed: 56] [added: 57] | Executive Vice President, Human Resources (May 2012-present) |

| Brion [added: S.] Johnson | [removed: 58] [added: 59] | [removed: President of Talcott Resolution (July 2014-present);] Executive Vice President, Chief Investment Officer (May [removed: 2012-Present)] [added: 2012-Present); President of the life and annuity business sold in May 2018 and formerly referred to as Talcott Resolution (July 2014-May 2018)] |

| Scott R. Lewis | [removed: 55] [added: 56] | Senior Vice President and Controller (May 2013-present); Senior Vice President and Chief Financial Officer, Personal Lines (2009-May 2013) |

| Robert [added: W.] Paiano | [removed: 56] [added: 57] | Executive Vice President and Chief Risk Officer (June 2017-Present); Senior Vice President & Treasurer (July 2010-May 2017) |

| David C. Robinson | [removed: 52] [added: 53] | Executive Vice President and General Counsel (June 2015-present); Senior Vice President and Director of Commercial Markets Law (August 2014-May 2015); Senior Vice President and Head of Enterprise Transformation, Strategy and Corporate Development (April 2012-August 2014) |

| James E. Davey | 53 | Executive Vice President and President of The Hartford Mutual Funds (2010-present) |

| John Wilcox | 52 | Chief Strategy and Ventures Officer (September 2016-present); President and Chief Operating Officer, Risk Strategies Company (June 2012-September 2016) |

[removed: Equity] [added: Equity] Compensation Plan [removed: Information][added: Information]

The following table provides information as of December 31, [removed: 2017] [added: 2018] about the securities authorized for issuance under the Company’s equity compensation plans.

On May 21, 2014, the [removed: shareholders] [added: stockholders] of

| | [removed: Number] [added: Number] of Securities to be Issued Upon Exercise [removed: of Outstanding Options, Warrants] [added: of Outstanding Options, Warrants] and Rights [removed: \[1\]] [added: \[1\]] | | [removed: Weighted-average] [added: Weighted-average] Exercise Price of [removed: Outstanding Options, Warrants and Rights \[2\]] [added: Outstanding Options, Warrants and Rights \[2\]] | | | [removed: Number] [added: Number] of Securities Remaining Available for Future Issuance Under Equity Compensation [removed: Plans (Excluding Securities Reflected in Column (a)) \[3\]] [added: Plans (Excluding Securities Reflected in Column (a)) \[3\]] | |

| [removed: \[1\]] [added: *\[1\]*] | [removed: The] [added: *The] amount shown in this column [removed: includes 5,212,045 outstanding] [added: includes* *5,489,908* *outstanding] options awarded under the 2005 Stock Plan and the 2010 Stock Plan. The amount shown in this column [removed: includes 4,444,226 outstanding] [added: includes* *3,446,535* *outstanding] restricted stock units [removed: and 795,044 outstanding] [added: and* *734,633* *outstanding] performance shares at 100% of target (which [removed: excludes 353,087 shares] [added: excludes* *187,798* *shares] that vested on December 31, [removed: 2017,] [added: 2018,] related to [removed: the 2015-2017 performance] [added: the* *2016-2018* *performance] period) as [removed: of December] [added: of* *December] 31, [removed: 2017 under] [added: 2018* *under] the 2010 Stock Plan and the 2014 Stock Plan. The maximum number of performance shares that could be awarded [removed: is 1,590,088 (200%] [added: is* *1,469,266* *(200%] of target) if the Company achieved the highest performance level. Under the 2010 and 2014 Stock Plans, no more [removed: than 500,000 shares] [added: than* *500,000* *shares] in the aggregate can be earned by an individual employee with respect to restricted stock unit and performance share awards made in a single calendar year. As a result, the number of shares ultimately distributed to an employee with respect to awards made in the same year will be reduced, if necessary, so that the number does not exceed this [removed: limit.] [added: limit.*] |

| [removed: \[2\]] [added: *\[2\]*] | [removed: The] [added: *The] weighted-average exercise price reflects outstanding options and does not reflect outstanding restricted stock units or performance shares because they do not have exercise [removed: prices.] [added: prices.*] |

| [removed: \[3\]] [added: *\[3\]*] | [removed: Of] [added: *Of] these [removed: shares, 4,517,632 remain] [added: shares,* *4,297,972* *remain] available for purchase under the ESPP as [removed: of December] [added: of* *December] 31, [removed: 2017. 8,397,784 shares] [added: 2018.* *7,294,481* *shares] remain available for issuance as options, restricted stock units, restricted stock awards or performance shares under the 2014 Stock Plan as [removed: of December] [added: of* *December] 31, [removed: 2017.] [added: 2018.*] |

[removed: Item] [added: Item] 15.

[removed: Exhibits, Financial Statement Schedules][added: EXHIBITS, FINANCIAL STATEMENT SCHEDULES]

| (1) | [removed: Consolidated] [added: Consolidated] Financial [removed: Statements.] [added: Statements.] See Index to Consolidated Financial Statements and Schedules elsewhere herein. |

| (2) | [removed: Consolidated] [added: Consolidated] Financial Statement [removed: Schedules.] [added: Schedules.] See Index to Consolidated Financial Statement and Schedules elsewhere herein. |

| (3) | [removed: Exhibits.] [added: Exhibits.] See Exhibit Index elsewhere herein. |

[removed: THE] [added: THE] HARTFORD FINANCIAL SERVICES GROUP, [removed: INC.][added: INC.]

[removed: INDEX] [added: INDEX] TO CONSOLIDATED FINANCIAL STATEMENTS AND [removed: SCHEDULES][added: SCHEDULES]

| [Report of Independent Registered Public Accounting [removed: Firm](#sCD791DDF13AD5333B4D9543AE9CF998E)] [added: Firm](#s3DD5870698CD5B10BF76AFC640E08A88)] | [removed: [F-2](#sCD791DDF13AD5333B4D9543AE9CF998E)] [added: [F-2](#s3DD5870698CD5B10BF76AFC640E08A88)] |

| [Consolidated Statements of Operations — For the Years Ended December 31, [removed: 201](#sA222AF554D9D55A58749B3508B6B0B61)7, 2016] [added: 201](#sB22B23DF164A59329AAF02E8C75C7BDC)8, 2017] and [removed: 2015] [added: 2016] | [removed: [F-3](#sA222AF554D9D55A58749B3508B6B0B61)] [added: [F-3](#sB22B23DF164A59329AAF02E8C75C7BDC)] |

| [Consolidated Statements of Comprehensive Income (Loss) — For the Years Ended December 31, [removed: 201](#sE965A12354B755A09742087AE9DAAE9F)7, 2016] [added: 201](#sA7F51A41E43F53598AF7B82CD3C0450E)8, 2017] and [removed: 2015] [added: 2016] | [removed: [F-4](#sE965A12354B755A09742087AE9DAAE9F)] [added: [F-4](#sA7F51A41E43F53598AF7B82CD3C0450E)] |

| [Consolidated Balance Sheets — As of December 31, [removed: 201](#s1456B6A9377759DDB21DCE799A8EBCB3)7] [added: 201](#sB3AC227352D65F7CB3845D3C8F59EA6C)8] and [removed: 2016] [added: 2017] | [removed: [F-5](#s1456B6A9377759DDB21DCE799A8EBCB3)] [added: [F-5](#sB3AC227352D65F7CB3845D3C8F59EA6C)] |

| [Consolidated Statements of Changes in Stockholders’ Equity — For the Years Ended December 31, [removed: 201](#sB258A215133A5BD2A8338AC94487A353)7, 2016] [added: 201](#s5C69D37D0EEA5860B88A96D5585C44B3)8, 2017] and [removed: 2015] [added: 2016] | [removed: [F-6](#sB258A215133A5BD2A8338AC94487A353)] [added: [F-6](#s5C69D37D0EEA5860B88A96D5585C44B3)] |

| [Consolidated Statements of Cash Flows — For the Years Ended December 31, [removed: 201](#s5EED204DBC895D19BDA44FA3A352F9E4)7, 2016] [added: 201](#s622C1E82D62B5864BAA28A5DA89EDF53)8, 2017] and [removed: 2015] [added: 2016] | [removed: [F-7](#s5EED204DBC895D19BDA44FA3A352F9E4)] [added: [F-7](#s622C1E82D62B5864BAA28A5DA89EDF53)] |

| [Notes to Consolidated Financial [removed: Statements](#sBBD6F8DAE8CF549A8D4B441281BA72FB)] [added: Statements](#sE139ED230259565BBC64FA70EF13683F)] | [removed: [F-8](#sBBD6F8DAE8CF549A8D4B441281BA72FB)] [added: [F-8](#sE139ED230259565BBC64FA70EF13683F)] |

| [Schedule I — Summary of Investments — Other Than Investments in [removed: Affiliates](#sD7C261B2C10E57199CCEB2FC8FF038C1)] [added: Affiliates](#s4A1E9A1C1BB25096A325608FE462AF5F)] | [removed: [S-1](#sD7C261B2C10E57199CCEB2FC8FF038C1)] [added: [S-1](#s4A1E9A1C1BB25096A325608FE462AF5F)] |

| [Schedule II — Condensed Financial Information of The Hartford Financial Services Group, [removed: Inc](#sB3E425BFD9D754AE95865FB4461024A8).] [added: Inc](#s218B9DFF9FF15AADAB57F7877F06CCDD).] | S-2 |

| [Schedule III — Supplementary Insurance [removed: Information](#sFCB98A74B1B95B7AB98F9DE18CC4913A)] [added: Information](#sC27B8E14072B5D4481F9E3469E6FB7EF)] | S-4 |

| [Schedule IV — [removed: Reinsurance](#sEAF9551B63B65D008B21E7E0C4E8BE23)] [added: Reinsurance](#sE37BF843BF7C5B7BB5B5E8EF4FDD8D13)] | S-6 |

| [Schedule V — Valuation and Qualifying [removed: Accounts](#s9737A96F3D0C5B01AF4F9D80AC6FEE05)] [added: Accounts](#s3105645C83F25C90B9AEEFE47D83EF6A)] | S-7 |

| [Schedule VI — Supplemental Information Concerning Property and Casualty Insurance [removed: Operations](#s817F627BF4625CBDBA1C91ED2A03A232)] [added: Operations](#s9DDF0FC32EF250ED80756B57F8F4402F)] | S-8 |

| | (a) | | (b) | | | (c) | |

| Equity compensation plans approved by stockholders | 9,671,076 | | $ | 40.84 | | 11,592,452 | |

| Total | 9,671,076 | | $ | 40.84 | | 11,592,452 | |

| | (a) | | (b) | | | (c) | |

| Equity compensation plans approved by stockholders | 10,383,348 | | $ | 37.25 | | 12,915,416 | |

| Total | 10,383,348 | | $ | 37.25 | | 12,915,416 | |

Part IV.

[removed: REPORT] [added: REPORT] OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING [removed: FIRM][added: FIRM]

[removed: The Hartford Financial Services Group, Inc.][added: THE HARTFORD FINANCIAL SERVICES GROUP, INC.]

[removed: Opinion] [added: Opinion] on the Financial [removed: Statements][added: Statements]

We have audited the accompanying consolidated balance sheets of The Hartford Financial Services Group, Inc. and its subsidiaries (collectively, the “Company”) as of December 31, [removed: 2017 and 2016,] [added: 2018] and [added: 2017,] the related consolidated statements of operations, comprehensive [removed: income,] [added: income (loss),] changes in stockholders’ equity, and cash [removed: flows] [added: flows,] for each of the three years in the period ended December 31, [removed: 2017,] [added: 2018,] and the related notes and the [removed: consolidated financial statement] schedules listed in the Index at Item 15 (collectively referred to as the "financial statements").

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, [removed: 2017] [added: 2018] and [removed: 2016,] [added: 2017,] and the results of its operations and its cash flows for each of the three years in the period ended December 31, [removed: 2017,] [added: 2018,] in conformity [added: with] accounting principles generally accepted in the United States of America.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, [removed: 2017,] [added: 2018,] based on criteria established in [removed: Internal] [added: *Internal] Control - Integrated Framework [removed: (2013)] [added: (2013)*] issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February [removed: 23, 2018,] [added: 22, 2019,] expressed an unqualified opinion on the Company's internal control over financial reporting.

[removed: Basis] [added: Basis] for [removed: Opinion][added: Opinion]

[removed: Consolidated] [added: Consolidated] Statements of [removed: Operations][added: Operations]

| | [removed: For] [added: For] the years ended December [removed: 31,] [added: 31,] | | | | | | | | |

| [removed: (In] [added: *(In] millions, except for per share [removed: data)] [added: data)*] | [removed: 2017] [added: 2018] | | | [removed: 2016] [added: 2017] | | | [removed: 2015] [added: 2016] | | |

| [removed: Revenues] [added: Revenues] | | | | | | | | | |

| Earned premiums | $ | [removed: 14,141] [added: 15,869] | | $ | [removed: 13,697] [added: 14,141] | | $ | [removed: 13,485] [added: 13,697] | |

| Net investment income | [removed: 1,603] [added: 1,780] | | | [removed: 1,577] [added: 1,603] | | | [removed: 1,561] [added: 1,577] | | |

| Total other-than-temporary impairment (“OTTI”) losses | [removed: (15] [added: (7] | | ) | [removed: (35] [added: (15] | | ) | [removed: (47] [added: (35] | | ) |

| OTTI losses recognized in other comprehensive income | [removed: 7] [added: 6] | | | [removed: 8] [added: 7] | | | [removed: 6] [added: 8] | | |

| Net OTTI losses recognized in earnings | [removed: (8] [added: (1] | | ) | [removed: (27] [added: (8] | | ) | [removed: (41] [added: (27] | | ) |

| Other net realized capital gains (losses) | [removed: 173] [added: (111] | | [added: )] | [removed: (83] [added: 173] | | [removed: )] | [removed: 29] [added: (83] | | [added: )] |

| Total net realized capital gains (losses) | [removed: 165] [added: (112] | | [added: )] | [removed: (110] [added: 165] | | [removed: )] | [removed: (12] [added: (110] | | ) |

| Other revenues | [removed: 85] [added: 105] | | | [removed: 86] [added: 85] | | | [removed: 87] [added: 86] | | |

| [removed: Total revenues] [added: Total revenues] | [removed: 16,974] [added: 78] | | | [removed: 16,107] [added: 14] | | | [removed: 15,997] [added: 15] | | |

| [removed: Benefits,] [added: Benefits,] losses and [removed: expenses] [added: expenses] | | | | | | | | | |

| Benefits, losses and loss adjustment expenses | [removed: 10,174] [added: 11,165] | | | [removed: 9,961] [added: 10,174] | | | [removed: 9,325] [added: 9,961] | | |

| Amortization of deferred policy acquisition costs ("DAC") | [removed: 1,372] [added: 1,384] | | | [removed: 1,377] [added: 1,372] | | | [removed: 1,364] [added: 1,377] | | |

| Insurance operating costs and other expenses | [removed: 4,375] [added: 4,281] | | | [removed: 3,341] [added: 4,563] | | | [removed: 3,459] [added: 3,525] | | |

| Loss on extinguishment of debt | [removed: —] [added: 6] | | | — | | | [removed: 21] [added: —] | | |

| Loss on reinsurance transaction | — | | | [removed: 650] [added: —] | | | [removed: —] [added: 650] | | |

| Interest expense | [removed: 316] [added: 298] | | | [removed: 327] [added: 316] | | | [removed: 346] [added: 327] | | |

| Amortization of other intangible assets | [removed: 14] [added: 68] | | | [removed: 4] [added: 14] | | | 4 | | |

| [removed: Total] [added: Total] benefits, losses and [removed: expenses] [added: expenses] | [removed: 16,251] [added: 17,202] | | | [removed: 15,660] [added: 16,439] | | | [removed: 14,519] [added: 15,844] | | |

| [removed: Income] [added: Income] from continuing operations before income [removed: taxes] [added: taxes] | [removed: 723] [added: 1,753] | | | [removed: 447] [added: 723] | | | [removed: 1,478] [added: 447] | | |

| Income tax expense (benefit) | [removed: 985] [added: 268] | | | [removed: (166] [added: 985] | | [removed: )] | [removed: 289] [added: (166] | | [added: )] |

| [removed: (Loss) Income] [added: Income (loss)] from continuing operations, net of [removed: tax] [added: tax] | [removed: (262] [added: 1,485] | | [removed: )] | [removed: 613] [added: (262] | | [added: )] | [removed: 1,189] [added: 613] | | |

| [removed: (Loss) income] [added: Income (loss)] from discontinued operations, net of tax | [removed: (2,869] [added: 322] | | [removed: )] | [removed: 283] [added: (2,869] | | [added: )] | [removed: 493] [added: 283] | | |

| [removed: Net (loss)] [added: Net] income [added: (loss)] | [removed: $] [added: 1,807] | [removed: (3,131] | [removed: )] | [removed: $] [added: $] | [removed: 896] [added: (3,131] | [added: )] | [removed: $] [added: $] | [removed: 1,682] [added: 896] | |

| [removed: (Loss) income] [added: Income (loss)] from continuing operations, net of tax, [added: available to common stockholders] per common [removed: share] [added: share] | | | | | | | | | |

| [removed: Basic] [added: Basic] | [removed: $] [added: $] | [removed: (0.72] [added: 4.13] | [removed: )] | [removed: $] [added: $] | [removed: 1.58] [added: (0.72] | [added: )] | [removed: $] [added: $] | [removed: 2.86] [added: 1.58] | |

| [removed: Diluted] [added: Diluted] | [removed: $] [added: $] | [removed: (0.72] [added: 4.06] | [removed: )] | [removed: $] [added: $] | [removed: 1.55] [added: (0.72] | [added: )] | [removed: $] [added: $] | [removed: 2.80] [added: 1.55] | |