Company: HIG-PG
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0000874766-25-000023
Chunk: 643

Company: HARTFORD INSURANCE GROUP, INC.
Filing Date: 2025-02-21
Form: 10-K
Item: Item 9B
Chunk 643
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 maturity date. Premiums on callable bonds may be amortized to call dates based on call prices. For structured financial assets subject to prepayment risk, yields are recalculated and adjusted periodically to reflect historical and/or estimated future prepayments using the retrospective method. For certain other structured securities, including securities that previously had an ACL and interest only securities, any yield adjustments are made using the prospective method. Prepayment fees and make-whole payments on fixed maturities and mortgage loans are recorded in net investment income when earned. For equity securities, dividends are recognized as investment income on the ex-dividend date. Limited partnerships and other alternative investments primarily use the equity method of accounting to recognize the Company’s share of earnings. For fixed maturities with an ACL, net investment income is recognized at the original effective rate and accretion of the ACL is recognized through net realized gains and losses. The Company’s non-income producing investments were not material for the years ended December 31, 2024, 2023 and 2022.Accrued Investment IncomeAccrued investment income primarily includes accruals of interest and dividend income from investments that have been earned but not yet received.Derivative InstrumentsOverviewThe Company utilizes a variety of over-the-counter ("OTC") derivatives, derivatives cleared through central clearing houses ("OTC-cleared") and exchange traded derivative instruments as part of its overall risk management strategy as well as to engage in income generation covered call transactions and replication transactions. The types of instruments may include swaps, 

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|Table of ContentsIndex to Consolidated Financial Statements and SchedulesNote 1 - Basis of Presentation and Significant Accounting PoliciesTHE HARTFORD INSURANCE GROUP, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

caps, floors, forwards, futures and options to achieve the following Company-approved objectives: •to hedge risk arising from interest rate, equity market, commodity market, credit spread and issuer default, price or currency exchange rates or volatility; •to manage liquidity; •to control transaction costs; and•to enter into income generation covered call transactions and synthetic replication transactions.Interest rate and credit default swaps involve the periodic exchange of cash flows with other parties, at specified intervals, calculated using agreed upon rates or other financial variables and notional principal amounts. Generally, little to no cash or principal payments are exchanged at the inception of the contract. Typically, at the time a swap is entered into, the cash flow streams exchanged by the counterparties are equal in value.The Company clears certain interest