The Hanover Insurance Reports Third-Quarter Net Income of $172.6 Million
Key Facts
The Hanover Insurance Group reported net income of $172.6 million, or $4.86 per diluted share, in the third quarter of 2026, compared with $178.7 million and $4.90 per share in the same period of 2025. The company said in its statement that the combined ratio was 92.3%, while catastrophe losses totaled $109.7 million. Those losses accounted for 6.8 percentage points of the combined ratio, which fell to 85.5% excluding them. The figures reflect a year-over-year decline in net income alongside underwriting performance affected by catastrophe losses. The company had announced that it would release results after the market close on October 28.
Net premiums written were 3.1% above their level a year earlier. Renewal rates increased 8.7% in personal lines, 7.4% in core commercial, and 4.3% in specialty. The company also reported rate increases of 6.1% in core commercial, 4.9% in personal lines, and 1.9% in specialty. The measures show premium growth and continued rate increases across all three business lines. They do not, however, remove the impact of catastrophes on underwriting results during the quarter.
The loss and loss adjustment expense ratio was 61.4%, up 1.6 percentage points from the same quarter a year earlier, which the company attributed to higher catastrophe losses. By contrast, the current accident-year loss ratio, excluding catastrophes, was 55.7%, 1.9 points below its level a year earlier. The measure excluding catastrophe effects provides a separate view of current accident-year claims performance. The 92.3% combined ratio includes the impact of catastrophe losses, which amounted to 6.8 percentage points. Excluding catastrophes, the combined ratio was 85.5%.
Net investment income rose to $131.9 million, up 12.7% from the third quarter of 2025, according to the company statement. The company did not attribute this increase to renewal rates, which it presented in the statement as a separate measure for its insurance lines. Book value per share was $99.69 on September 30, 2026, down 5.4% from June 30. But book value increased 2.7% excluding the after-tax unrealized decline in the value of fixed-income investments. This places growth in investment income alongside a decline in reported book value during the quarter, with a different measure when the impact of bonds is excluded.
In comparison with the previous quarter, the company reported second-quarter 2026 net income of $191.6 million, or $5.38 per diluted share, and operating income of $189.2 million, or $5.31 per share. Net premiums written rose 4.6% then, compared with growth of 3.1% in the third quarter. When the second-quarter results were announced, Chief Executive John C. Roche said the operating return on equity was about 20% and operating earnings reached $5.31 per share, both records for that quarter, alongside accelerating premium growth. On capital, Hanover announced a new $700 million share repurchase authorization in May. It also announced a quarterly cash dividend of $0.95 per common share in August.
The company will host an online discussion of its third-quarter results on October 29 at 10:00 a.m. Eastern time, according to the schedule it announced in September. The meeting follows the release of results on October 28 and gives management an opportunity to present and discuss the details. The company's shares, traded under the ticker THG, closed at $235.84 on October 27. The closing price alone did not include details on the session's high or low. Investors are awaiting management's presentation of the quarterly results at the scheduled discussion.