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Will A Strong Personal Insurance Unit Aid The Hartford's Q3 Earnings?

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Key Takeaways

  • HIG's Q3 earnings are expected to rise 23.7% year over year to $3.13 per share on $5B in revenue.
  • Personal Insurance growth is driven by rate hikes, higher insured value, and underwriting strength.
  • Rising costs and catastrophe losses may offset gains from strong premiums and investment income.

The Hartford Insurance Group, Inc. (HIG - Free Report) is scheduled to release third-quarter 2025 results on Oct. 27, after market close. The Zacks Consensus Estimate for earnings is pegged at $3.13 per share, which indicates an improvement of 23.7% from the prior-year quarter’s number.  

The third-quarter earnings estimate has witnessed five upward estimate revisions against one downward movement over the past 30 days. Meanwhile, the Zacks Consensus Estimate for revenues is pegged at $5 billion, implying 7.9% growth from the year-ago quarter’s figure.

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The Hartford’s Earnings Surprise History

HIG’s bottom line beat estimates in each of the trailing four quarters, the average surprise being 9.53%. This is depicted in the chart below:

What Our Quantitative Model Unveils for The Hartford

Our proven model predicts an earnings beat for The Hartford this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat, which is the case here.

Earnings ESP: The Hartford has an Earnings ESP of +0.91% because the Most Accurate Estimate of $3.16 per share is pegged higher than the Zacks Consensus Estimate of $3.13. You can uncover the best stocks before they’re reported with our Earnings ESP Filter.

Zacks Rank: HIG currently carries a Zacks Rank of 3.  

Factors Likely to Shape HIG’s Q3 Results

Revenues of The Hartford are expected to have benefited from strong contributions from Business Insurance, Personal Insurance and Employee Benefits businesses. The Zacks Consensus Estimate for overall net premiums earned is pegged at $6.1 billion, suggesting 6.3% growth from the prior-year quarter’s reported figure.  

Rate increases, new business growth and steady retention rates are expected to have aided the Business Insurance business. However, continued incidence of catastrophe losses is likely to have dampened the unit’s underwriting results in the to-be-reported quarter. The consensus estimate for Business Insurance’s earned premiums stands at $3.5 billion. 

The Personal Insurance unit is likely to have gained from steady rate hikes, higher insured value and renewal written price increases. Rate hikes, new business growth and strong underwriting results in the to-be-reported quarter are expected to have aided the homeowner's insurance business.  

The Zacks Consensus Estimate for earned premiums of the Personal Insurance segment is pegged at $949 million, which indicates a 7.2% increase from the prior-year quarter’s reported figure. 

The Employee Benefits business is anticipated to have been driven by strong persistency rates, higher fully insured ongoing sales, and improved life and disability results in the third quarter. However, the upside is expected to have been partly offset by escalating technology and staffing costs. The consensus mark for the unit’s revenues is $1.8 billion. 

Additionally, The Hartford’s investment results are likely to benefit from increased invested assets and improved reinvestment rates. However, the upside is likely to have been partly offset by a declining yield on variable-rate securities. The Zacks Consensus Estimate for overall net investment income is $709 million, suggesting 7.6% growth from the year-ago quarter’s figure. 

However, HIG’s bottom line is expected to have been pressured by increased benefits, losses and loss adjustment expenses, as well as higher insurance operating costs. Margins are also likely to have been impacted by ongoing investments in digital, analytics and data science capabilities.

Other Stocks to Consider

Here are some other companies from the insurance space, which, according to our model, have the right combination of elements to beat on earnings this time around:

HCI Group, Inc. (HCI - Free Report) currently has an Earnings ESP of +87.40% and a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for HCI’s third-quarter earnings is pegged at $2.35 per share, which indicates an increase to five-fold from the year-ago quarter’s figure.  

HCI Group’s earnings beat estimates in each of the trailing four quarters, the average surprise being 41.70%.

The Allstate Corporation (ALL - Free Report) has an Earnings ESP of +9.80% and a Zacks Rank of 2 at present. The Zacks Consensus Estimate for ALL’s third-quarter earnings is pegged at $6.73 per share, which implies a 72.1% surge from the year-ago quarter’s figure.  

Allstate’s earnings beat estimates in each of the trailing four quarters, the average surprise being 57.67%. 

Prudential Financial, Inc. (PRU - Free Report) has an Earnings ESP of +0.52% and a Zacks Rank of 3 at present. The Zacks Consensus Estimate for PRU’s third-quarter earnings is pegged at $3.60 per share, which implies a 3.5% rise from the year-ago quarter’s figure.  

Prudential Financial’s earnings beat estimates in three of the trailing four quarters and missed the mark once, the average surprise being 1.14%.

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