THG Q2 Earnings Beat on Personal Lines Gains, Revenues Miss

THG Underwriting Results Improve

The consolidated loss and loss adjustment expense ratio improved 1.7 percentage points year over year to 60.2%. Catastrophe losses totaled $91.8 million, contributing 5.7 points to the combined ratio, compared with a catastrophe ratio of 7% in the prior-year quarter.

The combined ratio excluding catastrophes remained unchanged at 85.5%. The current accident year loss and LAE ratio excluding catastrophes improved 30 basis points to 55.8%, while favorable prior-year reserve development contributed 1.3 points. Net premiums earned increased to $1.60 billion from $1.55 billion.

The Hanover's Core Commercial Growth Accelerates

Core Commercial net premiums written rose 7.2% year over year to $574.8 million. Growth accelerated from the first quarter, supported by increases of 6% in small commercial and 9.4% in the middle market. Renewal price increases averaged 7.8%, including rate increases of 7%.

Segment profitability weakened despite the faster premium growth. Operating income before taxes declined to $77.5 million from $83.9 million, while the combined ratio increased to 95.7% from 93%. The current accident year combined ratio excluding catastrophes deteriorated 1.8 points to 91.2%, reflecting higher liability loss selections and a difficult comparison with unusually low property losses a year earlier.

THG Specialty Underwriting Margins Narrow

Specialty net premiums written increased 4.4% to $384.4 million, reflecting improved growth momentum from the first quarter. Renewal pricing rose 3.6%, including average rate increases of 2.1%.

Operating income before taxes declined to $68.4 million from $71.2 million. The combined ratio increased to 88.3% from 86.5%, as the current accident year loss and LAE ratio, excluding catastrophes, rose 2.6 points to 51.6%. Lower catastrophe losses provided some support, falling to $10 million from $14.6 million.

The Hanover's Personal Lines Results Strengthen

Personal Lines net premiums written increased 2.6% year over year to $697.6 million. Growth reflected higher new business and continued renewal pricing, with renewal price increases averaging 8.7% and rate increases averaging 4.8%. Policies in force were essentially unchanged sequentially.

Operating income before taxes surged to $104.9 million from $57.4 million. The combined ratio improved 6.6 points to 88.9%, aided by lower catastrophe losses and better underlying loss experience. The current accident year combined ratio, excluding catastrophes, improved to 81.9% from 84.8%, as earned pricing exceeded loss trends and property claim frequency remained favorable.

THG Investment Income and Capital Position Advance

Net investment income increased 13.4% year over year to $119.6 million, driven by operating cash flows and higher earned yields. The portfolio’s pretax earned yield increased to 4.28% from 4.11%, while the fixed-maturity yield improved to 4.45% from 4.24%.

The Hanover ended June with $11.2 billion in cash and invested assets. Book value per share increased 3.5% from March 31, 2026, to $105.40. During the quarter, THG repurchased about 0.3 million shares for approximately $55 million. Through July 24, repurchases totaled roughly 0.8 million shares for $149 million, leaving about $660 million under the company’s authorization.

Zacks Rank

THG currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Insurers

The Progressive Corporation’s PGR second-quarter 2026 earnings per share of $4.85 beat the Zacks Consensus Estimate by 3.2%. The bottom line, however, decreased 6.1% year over year. Net premiums written were $21.1 billion in the quarter, up 5% from $20.1 billion a year ago. 

Net premiums earned grew 6% to $21.6 billion. The reported figure met the Zacks Consensus Estimate. Net realized gains on securities were $604 million, up 56% year over year. Combined ratio — the percentage of premiums paid out as claims and expenses — deteriorated 110 basis points from the prior-year quarter’s level to 87.1.

The Travelers Companies, Inc. TRV reported second-quarter 2026 core income of $10.04 per share, which beat the Zacks Consensus Estimate of $5.21 by 92.7%. The bottom line climbed 54% year over year. Revenues of $12.09 billion missed the Zacks Consensus Estimate of $12.27 billion by 1.5%.

Net investment income rose 14% year over year to $1.07 billion pre-tax ($883 million after tax). The combined ratio improved 670 basis points year over year to 83.6%, reflecting lower catastrophe losses, stronger reserve development and a better underlying combined ratio.

W.R. Berkley Corporation WRB reported second-quarter 2026 operating income of $1.27 per share, which beat the Zacks Consensus Estimate by 16.5%. The bottom line increased 21% year over year. Operating revenues totaled $3.8 billion, up 3.6% year over year. The top line surpassed the consensus estimate by 1.87%.

W.R. Berkley’s net premiums written were about $3.4 billion, up 2.4% year over year. The consolidated combined ratio (a measure of underwriting profitability) improved 160 basis points year over year to 90, missing the Zacks Consensus Estimate of 92.

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