Strong Financial Position Cushioning Against Adverse Market Developments

Good things about THG:

Strong financial position cushioning against adverse market developments

The group's financial position is considered to be strong. During 2009-13, THG's balance sheet size expanded from $8,023.2 million to $13,378.7 million. During the same period, its equity base increased from $2,339.1 million to $2,594.5 million. As a result, its financial strength increased. Moreover, the group's capital ratios were well in excess of prescribed regulatory levels. Strong financial position provides risk tolerance to adverse market developments such as decreasing investment opportunities, increasing claims, and others.

Strong credit ratings on account of overall financial performance

THG has been recording decent growth in premiums income over the last five years. During the 2009-13, the group's premium income increased at a compounded annual growth rate (CAGR) of 15%. THG's revenue growth in addition to the positive investment returns helped it record strong financial performance. Given the history of financial and business growth, the group was assigned strong ratings by various agencies. As of December 2013, THG's subsidiary, The Hanover Insurance Company was assigned financial strength rating of A by A.M. Best, A3 by Moody's, and A- by Standard & Poor. Its other subsidiary, Citizens Insurance Company of America was assigned financial strength rating of A by A.M. Best, and A- by Standard & Poor. These rating show that THG has financial security that outweighs vulnerabilities, and is highly likely to have the ability to meet financial commitments.

Wide product offerings position it among the top 25 property and casualty insurers in US

The group offers a wide range of property and casualty products and services to individuals, families and businesses through an extensive network of independent agents. THG is the holding company for a group of insurers that includes The Hanover Insurance Company, also based in Worcester; Citizens Insurance Company of America, headquartered in Howell, Michigan, and Chaucer Holdings, based in London, and their affiliates. Based on direct US premiums written, THG ranks among the top 25 property and casualty insurers in the US. The group offers an extensive range of products to its customers. Its wide range of personal lines and commercial lines insurance products include: personal automobile, homeowners and other personal coverages, commercial multiple peril, commercial automobile, workers' compensation, AIX program business, inland marine, bonds, other. In 2011, through the acquisition of Chaucer Holdings, the group diversified its business portfolio further by adding new products such as UK motor, marine and aviation, property, energy, and casualty and other. In 2012, THG launched a powerful new small commercial portal to make doing business with THG faster and easier by providing agency staff real-time access to information and services. Wide product offering helps the group to cater to large set of target customers, which in turn helps it to sustain its growth momentum.