Industry Read Across on HIG Group Benefits Results

Research evidence excerpt

Industry Read Across on HIG Group Benefits Results

Financials | Global Insurance - Life

July 23, 2026

Thomas Gallagher, CFA Industry Read Across on HIG Group

212-446-9439

Thomas.Gallagher@EvercoreISI.com Benefits Results

David Motemaden, CFA HIG reported 2Q26 employee benefits core earnings of $139mm at a

212-497-0832 7.4% margin, below consensus of $148mm / 8.1% and prior year

David.Motemaden@evercoreisi.com quarter of $163mm / 9.2%, as softer disability underwriting more than

Nicolas Lu offset better expenses and NII.

212-497-0812

Nicolas.Lu@evercoreisi.com As for topline, while 2Q is typically not a big seasonal sales quarter, the

Peter Knudsen $140mm level from this quarter was up 30% vs last year, with most of

212-708-8497 the increase coming from disability.

Peter.Knudsen@evercoreisi.com

In disability, LR climbed to 74.8% from 72.7% last quarter and 68.5% a

year ago, as HIG attributed to increased claim incidence across short

and long term disability, as well as less favorable – but in-line with long-

term expectation level – of long-term disability claim recoveries. Group

life LR was in-line with prior year quarter and climbed 1pt from 1Q26.

A look at some HIG disclosure from its 10-Q we think also sheds light

on the components of its group disability loss ratio, split between prior

year development and accident year claims. We note that all of the

adverse experience this quarter came from less favorable development

on PYD, while the accident year loss ratio actually improved

sequentially and year over year.

Since we think HIG takes a different approach to reserving for disability

vs. MET and UNM (putting up very conservative initial picks and then

releasing a lot over time), it’s unclear how much of a read across this

quarter will end up being.