Thanks everyone for being here today. My name is Mike Nitti. I am the Property and Casualty Insurance Analyst here at Goldman Sachs. We're pleased to have The Hartford here joining us. Representing The Hartford, we've got Chris Swift, Hartford's Chairman or Hartford CEO, Doug Elliot, President, and Beth Bombara, CFO. Hartford is a leading domestic insurance company with a market cap of about $18 billion, and a focus on commercial lines, particularly in the small and middle market, as well as in personal lines led by its association affiliation with the AARP. Chris joined The Hartford in 2010 as Executive Vice President and CFO, was named CEO in June of 2014, while Doug joined Hartford shortly after in 2011, overseeing both the property and casualty commercial business and group benefits.
He was named President in 2014, in which he was given responsibility of the company's personal lines book as well. Last but not least, is Beth Bombara, the company's CFO, and previously President of Talcott, which is the ring-fenced life insurance business that Hartford had previously written. That was her role since its formation in 2012, and prior to that was controller for The Hartford dating back to 2004. With those introductory comments, I'll turn it over to Chris for a few points. We'll open it up to Q&A, and go from there. Thanks so much, and thanks, Chris.
Good. Thank you, Michael. Always a pleasure to join you here at your conference, and for us to have the opportunity to update you on our story and actions. I thought I'd just summarize the businesses in general, as Michael said, we'll open it up to questions. If I start with commercial lines or in general, I'm very pleased with our overall performance this year. We headed into 2016 knowing competition was increasing, particularly on the pricing side. We started the year in a low interest rate environment, and if I look at all our businesses, except the one we'll talk about, I think they are performing well and very close or exceeding expectations. If I dive a little deeper into our commercial franchise, which is the largest part of our book of business, and start with small commercial.
Small commercial is our growth engine, our profit engine, and it's our highest ROE business, and it's performing marvelously. We've added some capabilities to commercial this year, principally in the E&S space. We acquired an E&S insurer in Atlanta to help expand our risk appetite in serving small commercial. We're also moving upscale in small commercial, taking on larger account sizes than we have in the past, increasing, again, our underwriting risk appetite. In middle market, middle market is probably the toughest component of our business today. Fierce price competition for new business. People are trying to hold on to their retentions in the most efficient way. We knew this business was under pressure and that we were going to be disciplined heading into 2016, and we've seen a reduction on our top line and fewer new business opportunities. On the positive side, retentions are strong.
Actually, we're maintaining our margins throughout all of 2016. This line of business has probably had the most new investment in capabilities, whether it be our new industry verticals, such as energy. We've launched an energy vertical here in the fourth quarter. Whether it be our international capabilities that we've added with our partnership with AXA Financial to expand to insure property and liability coverages of our U.S. insurers. There's numerous other examples of how we're adding to our capabilities. For instance, I think we have the leading construction practice, U.S. construction practice of any U.S. domestic insurer that we've built over the last three years. A lot of good things from a capability side, but we're being very cautious on new business opportunities. In the large side of our commercial business, I view that as just a consistent performer in a tough competitive market.
Our key differentiator, as we explained in our claims day in Hartford maybe a month or so ago, is really our claims capabilities in the large side, traditionally the national account business. We have good capabilities there. We have a good size book of business, but again, growing it is very difficult in this competitive environment. If I look at our group benefits business, it has returned to growth. After years of restructuring, shrinking some aspects of that book of business, we're back in a growth area with consistent margins, about 5.5%. We've built out our full capability of voluntary products, and we're adding additional A&H capabilities to our product set. Again, very consistent and stable performer, and we're optimistic about our sales opportunities as we head into 2017. Talcott is just a beautiful thing, as I call it internally. It's performing exactly as expected.
It will probably exceed or come close to the high end of our earnings guidance range for the full year. We've taken a dividend about $750 million this year. We expect another dividend next year in the range of $600 million. It is performing as designed. Risks are well maintained or well managed. It's a self-contained business unit. Mutual funds. I would say our net flows are consistently improving. We've added two new capabilities to our mutual fund platform. We've added a second sub-adviser in addition to Wellington, called Schroders. We're using Schroders' investment capabilities part of our fund complex now. In addition, we bought a smart beta company called Lattice out in California, and are going to integrate it into the mutual fund platform. Those are just a quick update on some of the business activities.
The one soft spot for us and others in the industry today is auto. Principally personal lines auto for us, and what I would remind people is that we have seen an increase in frequency and severity trends beginning in the second half of 2015. Those trends have continued to put some pressure on our results in 2016. If I look at the actions that our team has been aggressively taking over the last 12 months, this team is working 24 by seven to fix and improve this line of business. We have adjusted our underwriting, we have shrunken our agency footprint, we have taken expense actions on operating expenses, and we've also taken commission adjustments in what we pay our agents. All those metrics I see, and Doug sees every day also, are beginning to take shape, and will begin to improve our 2017 combined ratios.
As we head into 2018, we expect to get closer back to our target margins in this business going forward. As I mentioned, those trends are pressuring us here in 2016 also. As we look out into the fourth quarter here and we do our fourth quarter reserve studies, we see more bodily injury severity pressure in these books of business, both personal and commercial auto. I do expect a prior year reserve adjustment, principally for accident year 2015, in the range of about $50 million pre-tax, attributed 60% to commercial lines and 40% to personal lines. Disappointing. There's no one more disappointed than the three of us that these trends are continuing.
If I look at the industry trends that most carriers face of increased miles driven, full economic activity, lower gas prices, more fatalities on the road, we've seen double-digit increase in fatalities over the last two years. Lastly, but not least, is distracted driving. I would implore this group as professionals in the investment management space is educate your friends, your family, your children on distracted driving. It is a real issue that's causing real pain for the society in general. That's all I'll say there. You put all that together, we've needed to make some adjustments to our severities calls for 2015. As we see, again, with more severe accidents, just a little bit more litigation and legal advice and counsel being sought as we settle out these claims. I'll end lastly with our capital generation.
I'm very pleased with our ability to continue to generate excess capital. All our businesses are generating excess capital. Creates a lot of dividend flow to our holding company where we, with Beth's leadership, can do accretive things for shareholders with that capital. As you know, we bought in roughly about $1.3 billion of stock this year. We'll buy in $1.3 billion next year also. We've increased the dividend. It gives us a lot of flexibility to do accretive things for shareholders. We always talk about using our excess capital primarily to grow our businesses, either organically or through acquisition. If we can't find returns that are acceptable to us in those growth strategies, we'll continue to return excess capital to our shareholders. Michael, we look forward to answering any of your questions or your guests' questions here today.
Thanks, Chris. Why don't we just pick up with your comment on the reserves in the fourth quarter. Can you talk about the current accident year, P&C, and how we should be thinking about that, and whether or not that reserve adjustment is effectively addressing the catch-up for the full year?
Yeah. As I said, the reserve adjustment's primarily for 2015 accident years. What I neglected to say, and thank you for reminding me, is that for personal lines, we had guided people to a 101%-103% full year combined ratio for that line of business. With these adjustments and some of the trends that we're seeing, we're probably in at the high point of that 103% to slightly exceeding it as we close out the year.
Just to be clear, that was for the auto.
Auto online. Yeah, auto online.
Yeah. Okay. Can you maybe talk a little bit about the trends that you're seeing and as we've gone through the quarter, what have you seen that sort of led you to that conclusion, or what has been the trend through the quarter? If we can get some color on that.
I'm going to ask Doug to add his color.
Michael, let's start with commercial. We haven't talked a lot about commercial. Just share with you what we're seeing. Number 1, the commercial pressure we see in auto is primarily centered in small commercial.
We've been working at middle market auto for the last 4 years. In fact, our rate change in that line in the middle has been in addition to 30+% over these 4 years. We're not feeling the pressure in middle at the moment. What we're feeling in small commercial, for those cases that are open in that 12-36-month category, we're feeling pressure and severity to get them closed, and we're seeing more litigation on the backside from the plaintiff end. The pressure on severity is in bodily injury, tied in with speed and damageability of some of these accidents. It's a bit more challenged than we expected, and in certain classes. What I would close my comments in commercial by saying, we are now adjusting our underwriting approach and refer to underwriter.
We've got a very automated system in small commercial where we accept applications on the glass through the computer with our agents. We have now changed our profile of what gets referred to an underwriter, aggressively moving up, getting more touches on those auto, particularly standalone auto cases that have worked their way into our system. That's small commercial, and that's really where the pressure is right now on the auto line. In personal lines, I start off by saying, last year at this time, we were struggling with an uptick in frequency. As we've worked our way through a series of adjustments, our view now looking backwards in the fourth quarter so far, our frequency picks are holding. Feel pretty good about where we are, and really don't have an adjustment on the frequency side. What we're feeling is this continued pressure on severity.
As we look at not only ourselves, but what we can tell from data around us, we look at the ISO Fast Track data. Those severity dynamics on a paid basis look to be across the industry in that 5 to 5-plus range, and we're feeling that as well. We expected our severity second half of the year to be a little bit less, and largely because last year we had such aggressive patterns in the second half of the year. They're a little bit higher than we had hoped they would be 6 months ago. We want to make sure as we close 2016, we get on top of that, and we've adjusted for 2015 as well.
When you break into that BI component, you mentioned legal costs. Maybe could you give us a little bit more granularity in terms of what's driving that change with some more specificity? You also mentioned specific lines of business. What are the areas that you're seeing this more so than others?
Well, in personal lines.
Well, maybe just that second part, going back to commercial.
Okay.
Yeah.
In commercial, we're seeing percentage of open cases, an increased percent with attorney representation on the backside, so on the plaintiff side.
They're putting pressure on awards, so the awards are up slightly from where they had been-
Where they would be without attorney representation. The changes in $100,000 case estimates and up, so the number of changes in a quarter where we had a loss estimate that moved by more than $100,000, are moving more than we expected. We've got our triangles, and we've got all that factored in. We're seeing a bit more movement on the larger end in our commercial cases. We don't see the same trends in middle that we see in small, but we see some of the same trends in small that we've experienced in personal lines, where the severity element of BI is reaching into our small commercial book, where we might have one or two vehicles in a small fleet, a doctor's office, or a lawyer's practice.
I would say also, too, the data that I've seen, there has been an uptick in the construction area of small.
Anything construction-wise, that class of business is exhibiting poorer loss behavior than we've seen in the past.
When I talk bodily injury, I am specifically talking about BI because I think the PD element, the physical damage element, looks to be within our expectation, knowing that we're having to price up for the value of some of the features that are in these cars. We've talked about that, Mike, at length with you. Particularly, I think about the Ford trucks and the Chevy trucks and the trucks that are attached to some of these small commercial vehicles. We are doing our best to stay on top of features, we're feeling like the speed and the casualties that are now occurring are causing us to adjust our estimates.
Got it. What about rate activity? We've seen you talked on the third quarter call about the rate action that you've taken. Can you just give us an update in terms of what you've now done since the call and what you're expecting to continue to do from here?
I gave you a little preview of what we thought the fourth quarter would look like, which is continued focused activity to get our pricing on top of those loss trends, that activity continues. We had several quarters in a row of 7% written price change. We expect the fourth quarter to be in the 9% range. We still do expect that to happen, Mike. As we move into 2017, the activity won't stop, right? We're going to stay on top. We have talked about a multi-year plan to get our book back adequately priced. It's more than just the pricing element, just want to share this morning that the pricing element pressure continues. The last thing I would say about that, Mike, we do give an all-in pricing number, obviously, there are state variations. There's AARP versus agency variations.
We use averages, but across our norms, we are leaning into territories, and clearly the agency end a little bit harder that needs more rate than our direct book.
I see. Maybe we could talk a little bit about, since we're sort of on the update topic, as far as capital deployment is concerned, could we get sort of the mark to market on share repurchase and thought process?
Yep, sure. Our plan for the fourth quarter was that we would be repurchasing about $280 million of common stock, and we're on track for that. That will pretty much close the initial program that we had. As Chris said, we have $1.3 billion earmarked for 2017. We also had a debt maturity in October, which we paid down. We also anticipate paying down a maturity that we have in March. Our plans are very consistent with what we shared in October, and we're continuing to execute.
One area of focus at this conference has been policy, taxation, regulation, and maybe some environmental commentary on interest rates and macro factors. Maybe we could talk a little bit. We'll start with the impact, if it comes to pass, of lower tax rate and how you're thinking about that. Maybe we could talk a little bit about the impact of higher interest rates and does that have any strategic change or any impact on the strategic direction of the company? First question to Beth, maybe she can.
Yeah. As Chris reminds me, until the tax laws actually change, they haven't changed. We obviously are spending a lot of time looking at what that impact could be. A couple of things. First, just from an overall effective tax rate, one thing to point out if you look at our results for this year is our effective tax rate tends to bounce around a lot, especially because of the impact of some of the transactions that we've done. If you normalize for that and you go through the 9 months, our effective tax rate's about 21% because some of the preference items that we have. If we think about a reduction in the corporate tax rate to 20%, we would expect that 21% effective tax rate to be about 12%.
Definitely would be a positive for us, assuming all preference items stay that we currently have. Our DRD deduction and some of the tax-exempt interest that we have on our muni portfolio. That's positive. On the other hand, we, like every company, will have to look at our balance sheet and the deferred tax assets that we have up today that are on the balance sheet, assuming a 35% tax rate. If you lower that to 20%, probably looking about a 4% reduction in book value per share from that change. The other thing I would say with that too is that when we think about cash tax, the amount of money we're actually spending, if as part of corporate tax reform, the AMT would be eliminated, and assuming we get paid for the AMT credits we already have.
Going forward, that would provide a benefit from a cash tax perspective because we do have net operating losses that we would be utilizing, and we'd be getting that full benefit today. What oftentimes happens is as we project utilization of our NOLs, we bump into AMT, and so from a cash perspective, we're still paying tax even though we get a credit. Kind of think about it in those 3 buckets would be the impact sitting here today with a lot of assumptions.
Got it. Thank you for that.
I think from your question on strategically what happens in a rising rate environment, there's just two aspects I would count upon how we think about what to do with our investment portfolio. We have roughly $75 billion of general account assets to manage between our P&C operations, Group Benefits, and Talcott. I would say that generally over the last year, we've favored investment-grade corporates, mortgages, CMBS, and certain classes in the high-yield area. We've de-emphasized municipals are underweight munis emerging markets. We had been underweight equities heading into the quarter, and we're starting to close that underweight on equities. From an investment side, we think there'll be opportunities to pick, again, not index, pick the appropriate sectors and pick the appropriate names where we have a chance then to create alpha for our shareholders.
Our investment manager's got a lot of capabilities in those areas, and we're pretty confident we can continue to find appropriate opportunities without taking undue risk. I don't think we're in an undue risk position from our portfolio. I mean, we take educated risks, and we have the capital to back it. I think in a rising rate environment for any financial services company is interesting because it has moving parts on both sides of the balance sheet, right? The asset side, we just talked about the mark to mark that flows through book value and the liability structures. Being predominantly a P&C and Group Benefit-orientated company, we don't mind a modestly rising rate environment as long as there's not terrible spikes along the way and that there's not inflation in the certain sectors where we have significant exposure.
If you think about wages, workers' comp exposure we'd have to manage that inflationary aspect very closely. You might earn more spread from your investments, but your loss costs could feel a little pressure. Net, I still think it would be a positive and something that we and others in the industry can manage appropriately.
When you think about you've got a few disparate businesses. You've got the Group Benefits business. You've got obviously Talcott. You've got P&C primarily through an exclusive direct relationship on the personal line side. You've got more of the independent agent dynamic on the commercial side. Thinking about all of these different dynamics, just could you touch a little bit on the complexity of managing all of these? Then in a rising rate environment, are there businesses that you feel are more likely that you could either monetize or where there may be more value in other hands?
From a business side, our core franchise is geared around property, casualty, and group benefits. We like those businesses. We think we could create shareholder value over the long-term with those businesses. We think our consumer-centric mindset on serving customers and growing our capabilities will be very advantageous. Talcott, we've been in runoff for the last 5 years on, and whether we run that off over a longer period of time or there is a transaction that is economic and feasible to execute, we'll continue to push ourselves to explore that. That's sort of a gray area right now of when. I would say in a rising rate environment, the opportunity to sell long-dated liabilities is a lot easier and more economic. Mutual funds, we like that business. It's not unusual for an insurance group to own a mutual fund complex.
We view it really as a distribution capability that we have where we have 100% sub-advised with Wellington and Schroders going forward. I see these businesses as very complementary, particularly P&C and benefits. There's not a lot of distraction with the other two businesses that we own, either running off or manage for a steady dividend flow and a higher ROE, which is our mutual fund business. They can create a lot of value for a long period of time.
Great. If anyone in the audience has a question, feel free to raise your hand. I'm going to keep going here, but don't be dissuaded from asking a question if you have one. I guess, Chris, picking up on a point that Beth had made before about on the tax side, I was just curious, can you give us a lens into your conversations with state regulators when you're looking to push through rate increases? How relevant is the tax rate, or does that become part of the discussion when you're looking at requesting a certain amount of rate or the required overall profitability for the book of business?
Yeah. I'll let Doug comment, too. Generally, what I would say about our regulatory posture and regulatory relationships across the country, it's very constructive, very professional. By and large, what regulators want is competition and choice in their local markets. I find them fairly accommodating these days, given the industry trends of frequency and severity, particularly in the auto line. Regulators tend to focus on consumer-orientated insurance businesses, primarily healthcare, home, and auto, less so on commercial, but it's still regulated, and there's processes that we have to go through. I find them, given what the industry's been dealing with in auto and home over the last couple of years, I think they've been very constructive and fair with our rate filings and requests. Doug?
I would agree with that. Mike, it's a good question. It's been a while since a change has occurred, so I have to think back to during that period of change, what might have occurred in the process. We've got a constructive dialogue right now across, and in the case of personal lines, where these trends have just spiked across the industry over the past two accident years, we find a pretty good partnership, and I expect that to continue over the next several quarters.
Great. Question here in the audience. Here we go. The mic coming. Fifth row back. There you go. Thanks.
Just on the charge you were talking about, who's to say that there's not going to be another sort of charge like this next year this time or during the year? Is this something you think of as a one-off? If there needed to be a charge, what would have to happen for there to be another charge next year?
I would say, and I'll let Beth comment, too, is that if you look at some of our actions that we've taken, particularly on the accident year 2014 and 2015 in prior quarters, we think we made the necessary adjustments at that time. I think the adjustments we made for 2014 are holding. 2015 is just a little bit more pressure, as Doug said, on closing out cases, particularly with litigation involved and more severe accidents and more severe injuries. We've made our best estimates to triangulate a number of different data points from the industry. We've sought some outside views, independent of our organization, about other industry participants. All I could tell you is that we've made our very best pick.
Particularly with the 2016 accident year and 2015, we think we've got our arms around it to give us a high degree of confidence and that we've put this behind us.
I guess maybe just Chris, to follow up on that. Your 2016 accident year, normally you sort of take the 2015, you add your rate and loss trend, then to get to 2016. If 2015 goes up, can you talk about maybe the interaction between the current accident or the developed accident year in 2015 and the current accident year in 2016?
Yeah. The 2015 impact that we just took affects 2016.
That is part of the new baseline loss ratio. As I said, we're going to be at the higher end of our 103 guidance because of that impact.
Got it.
I would say the judgments we've made, we've probably put more conservatism into the 2016 pick than we have before.
Mike, one of the challenges and opportunities, but challenges we have looked at ourselves and tried to evaluate is, you've seen our new business numbers have drastically changed over the last 4 quarters, and fourth quarter they will change more. As we have adjusted our underwriting appetite, as we've gone back and adjusted our class plan, we're now on our fourth iteration of that. We're seeing a better profile of mix coming through, and we're trying to quantify that. The other thing I would say is every year when we try to predict next year's accident year outcome and the plan for the next year, we look at the last several accident years to establish a baseline. What has happened over the past 16 months, though, is we've put less comfort in a three-year and more into these evolving trends now.
The 2016 baseline, which would've been established based on looking at 2013, 2014, and 2015, as we've moved through the year, we're believing that 2015 was a better baseline to jump off of. We put more and more confidence in that, which is actually putting a higher starting point, which has put pressure on 2016. We think it's prudent. We look back at 2013, 2014, they look like much more docile, normal years than 2015, and we think 2015 is a better starting point for 2016, and as we adjust, we adjust 2016 as well. The last point I'll make, and those of you in the room that have followed us for a number of years, some of where we are right now reminds me of where we were in 2011 and 2012 with workers' compensation.
The environment moved on us with frequency. We looked at our book of business, we felt like we were underpricing the market. We had to get on that, and we had to take a series of quarters in a row of getting accident years 10 and 11 right. Once we got out through that, the accidents on the underwriting side and the pricing really did put that book of business in good stead going forward. I believe we'll see the same thing in personal line, it is a stubborn trend that we're leaning into right now.
Another question there?
Yeah, just going back to your comments on inflation and also talking about workers' comp and some of the longer tail lines of business, do you disclose some sort of assumptions in your inflation projections, or would you bake into your reserve on some longer tail line?
We've talked about that in the past on earnings calls that both from a pricing and a reserving side, we have inflation adjustments. Think about it from a reserving side in that 6%-7% long-term inflation range on medical severity.
I do believe it's one of the reasons that our new business successes are a bit more moderate because I think others are leaning into maybe a bit more aggressive expectation for medical. Our view, though, is over time when you get these cases, you're going to be on some of these medical cases for 10-20 years, and our long-term pick in medical still sits in the range Chris described.
What do you think is behind, it's clearly auto's been a quagmire for the industry for some time now, with sort of shifting reasons, whether it's frequency or severity and what's underneath the severity. What is your view from here? Is it that we're sort of in a new normal as far as personal auto is concerned, or some of these demographic trends really pervasive, such that the visibility that you historically had, or you or the industry's historically had into auto loss trends is now murkier, either because of distracted driving, ride sharing, ride hailing services? Can you talk to me a little bit about how you're thinking about it from, as you answer that question, how does that factor into your pricing actions or rate making?
I'll let Doug comment because we have this debate all the time. I just put it into two driving factors. Activity, whether it be a 4.9% unemployment rate, whether it be miles driven, there's just more activity on our roads than ever before. You have to also say that that activity is being compounded with just a lot more devices in the car, embedded in the car, right? There's a lot of technology and a lot of distraction that is embedded in the car. If you bring any other device that adds to that complexity, you're not paying attention. When we talk about speed of accidents, it's not because everyone's driving faster, it's because there's less reaction time for braking, so the speed of the accidents that are occurring are occurring at higher speeds because reaction time is down. That's classic distracted driving.
That's why I said what I did in my opening, and it was a plea. We got a problem, and we can fix it. I grew up in the days back in a '63 Impala, and I sat in the back seat, and I didn't wear a safety belt. When Dad took a fast turn, I used to bounce from end to end. I learned how to put a safety belt on, and I put one in the back seat of the car now. We can teach ourselves to put down devices. Put them down, get there safely, and then pick up your activity. Teach everyone to do that.
Do you think that the advancements, technological advances in cars give people a false sense of security that they don't need to pay as much attention when they're driving because the cars kind of drive themselves? Whether that's on a highway, do you think that that is a contributor as well?
There are certain behavioral aspects to that question. I don't know, to tell you the truth. All cars are different. Do you have two cars at home?
Yep.
I bet their safety features are different. How do you keep track of it in real time to make those decisions? It's hard. I could tell you the research we do in conjunction with our partner MIT AgeLab, is that the only real meaningful safety technological features you need in a car is the front end collision avoidance system. All the other stuff that flashes on your side lights or vibrates or this and that, it's a distraction. If you're going to purchase a new vehicle, purchase a vehicle that has that collision avoidance to help you stop if you're not paying attention.
Mike, our view is that there is a bit of a new norm here. Our view is today is the baseline for tomorrow. As recently as the data this week kind of looked at the Thanksgiving Day holiday traffic.
The number of highway deaths were up again. Miles driven is up, and our expectation in the fourth quarter will still be 3%, 3.5% up. We're leaning into 2017 with that as a new norm.
Great. One last one here in the corner.
Ahead of the panel discussion this afternoon, could you maybe give us your views on disruptive technology in the insurance business again?
Disruptive tech-
Just so we can compare notes.
Yeah. From an insurance business model side, I think it's well documented and discussed in general that most of the disruptive technology is focused on distribution-related activities, with a close second on underwriting activities and how automation can help big data, can help have underwriting advantage. Those are the trends that we see, if I understood your question, sir. I think from our small commercial platform side, we've been in business 30 years. We think we're a leader with our existing technology today. We have great service center capabilities. We're going to continue to invest and innovate in that channel to maintain our leadership position.
Before we wrap, let me just, one last question on small commercial, just because it came up here. A lot of other companies have been talking about small commercial, building franchises and platforms to focus on small commercial. Some disruption may come not just from new entrants, but from incumbents that look to focus on the part of the business that's been really at the core of Hartford's success on the commercial side for a long time. How do you think about protecting your franchise position in small commercial, given the headwind-
Continuing to invest-
Yeah
Innovate ourselves. Others, they see the aspects of this segment of the business, that it's predictable, profitable. We've been at it 35 years, the capabilities, the brand, the recognition, and the investments that we have made and will continue to make, we're going to try to create that differentiated outcome.
Great. There's no more questions. I'd like to thank The Hartford for their time today. Thanks, Chris. Thanks.
Thank you.
Thanks, Mike.