Hanover Insurance Group (THG) reported Q3 operating EPS of $0.99, $0.89 worse than the analyst estimate of $1.88.
- Combined ratio of 101.0%; combined ratio, excluding catastrophes(1), of 94.2%
- Catastrophe losses of $90.1 million, or 6.8 points of the combined ratio, including the impact from Hurricane Ian of $28.0 million
- Net premiums written increase of 9.5%*, with contributions from each segment
- Renewal price change(2) of 11.2% in Core Commercial, 12.4% in Specialty and 7.3% in Personal Lines, driven by homeowners renewal price change of 12.1%
- Rate increases(2) of 7.3% in Core Commercial, 8.0% in Specialty and 4.0% in Personal Lines
- Current accident year loss and loss adjustment expense ("LAE") ratio, excluding catastrophes(3), of 64.1% reflecting higher-than-expected inflation, primarily impacting personal auto, homeowners, and commercial multiple peril ("CMP") property lines, as well as property large loss activity in CMP
- Net investment income of $73.0 million, above expectations and helped by higher operational cashflows and bond reinvestment rates, but below the prior-year quarter result due to the elevated level of partnership income in the third quarter of 2021
- Book value per share of $64.59, down 10.5% from June 30, 2022, primarily driven by a decrease in the fair value of fixed maturity investments due to the higher interest rate environment