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Employee Benefit Plans
 12 Months Ended
Dec. 31, 2020
Retirement Benefits [Abstract]  
Employee Benefit Plans
19. EMPLOYEE BENEFIT PLANS
Investment and Savings Plan
Substantially all U.S. employees of the Company are eligible to participate in The Hartford Investment and Savings Plan under which designated contributions may be invested in a variety of
investments, including up to 10% in a fund consisting largely of common stock of The Hartford. The Company's contributions include a non-elective contribution of 2.0% of eligible compensation and a dollar-for-dollar matching contribution of up to 6.0% of eligible compensation contributed by the employee
each pay period. The Company also maintains a non-qualified savings plan, The Hartford Excess Savings Plan, with the dollar-for-dollar matching contributions of employee compensation in excess of the amount that can be contributed under the tax-qualified Investment and Savings Plan. An employee's eligible compensation includes overtime and bonuses but for the Investment and Savings Plan and Excess Savings Plan combined, is limited to $1 annually. The total cost to The Hartford for these plans was approximately $153, $156 and $134 for the years ended December 31, 2020, 2019 and 2018, respectively.
Additionally, The Hartford has established defined contribution pension plans for certain employees of the Company’s international subsidiaries. The cost to The Hartford for the years ended December 31, 2020, 2019 and 2018 for these plans was immaterial.
Post Retirement Benefit Plans
Defined Benefit Pension Plan- The Company maintains The Hartford Retirement Plan for U.S. Employees, a U.S. qualified defined benefit pension plan (“Pension Plan”) that covers substantially all U.S. employees hired prior to January 1, 2013. The Company also maintains non-qualified pension plans to provide retirement benefits previously accrued that are in excess of Internal Revenue Code limitations.
The Pension Plan includes two benefit formulas, both of which are frozen: a final average pay formula (for which all accruals ceased as of December 31, 2008) and a cash balance formula for which benefit accruals ceased as of December 31, 2012, although interest will continue to accrue to existing cash balance formula account balances. Employees who were participants as of December 31, 2012 continue to earn vesting credit with respect to their frozen accrued benefits if they continue to work. The interest crediting rate on the cash balance plan is the greater of the average annual yield on 10-year U.S. Treasury Securities or 3.3%. The Hartford Excess Pension Plan II, the Company's non-qualified excess pension benefit plan for certain highly compensated employees, is also frozen.
Group Retiree Health Plan- The Company provides certain health care and life insurance benefits for eligible retired employees. The Company’s contribution for health care benefits are a function of the retiree’s date of retirement and years of service. In addition, the plan has a defined dollar cap for certain retirees which limits average Company contributions. The Hartford has prefunded a portion of the health care obligations through a trust fund where such prefunding can be accomplished on a tax effective basis. Beginning January 1, 2017, for retirees 65 and older who were participating in the Retiree PPO Medical Plan, the Company funds the cost of medical and dental health care benefits through contributions to a Health Reimbursement Account and covered individuals can access a variety of insurance plans from a health care exchange. Effective January 1, 2002, Company-subsidized retiree medical, retiree dental and retiree life insurance benefits were eliminated for employees with original hire dates with the Company on or after January 1, 2002. The Company also amended its postretirement medical, dental and life insurance coverage plans to no longer provide subsidized coverage for employees who retired on or after January 1, 2014.
Assumptions
Pursuant to accounting principles related to the Company’s pension and other postretirement obligations to employees
under its various benefit plans, the Company is required to make a significant number of assumptions in order to calculate the related liabilities and expenses each period. The two economic assumptions that have the most impact on pension and other postretirement expense under the defined benefit pension plan and group retiree health plan are the discount rate and the expected long-term rate of return on plan assets. The assumed discount rates and yield curve is based on high-quality fixed income investments consistent with the maturity profile of the expected liability cash flows. Based on all available market and industry information, it was determined that 2.65% and 2.36% were the appropriate discount rates as of December 31, 2020 to calculate the Company’s pension and other postretirement obligations, respectively.
The expected long-term rate of return considers the actual compound rates of return earned over various historical time periods. The Company also considers the investment volatility, duration and total returns for various time periods related to the characteristics of the pension obligation, which are influenced by the Company's workforce demographics. In addition, for the pension plan, the Company anticipates an allocation of approximately 60% in fixed income securities and 40% in non fixed income securities (global equities, hedge funds and private market alternatives) to derive an expected long-term rate of return. For the other post-retirement plans, the Company anticipates an allocation of approximately 70% in fixed income securities and 30% in non fixed income securities. Based upon these analyses, management determined the long-term rate of return assumption to be 6.00% and 5.60% for the Company's pension and other postretirement obligations, respectively, for the year ended December 31, 2020 and 6.45% and 6.00% for the Company's pension and other postretirement obligations, respectively, for the year ended December 31, 2019. To determine the Company's 2021 expense, the Company has assumed an expected long-term rate of return on plan assets of 5.40% and 4.90% for the Company's pension and other post retirement obligations, respectively.
Weighted Average Assumptions Used in Calculating the Benefit Obligations and the Net Amount Recognized
 Pension BenefitsOther Postretirement Benefits
For the years ended December 31,
 2020201920202019
Discount rate2.65 %3.33 %2.36 %3.15 %
Weighted Average Assumptions Used in Calculating the Net Periodic Benefit Cost for Pension Plans
 For the years ended December 31,
 202020192018
Discount rate3.33 %4.35 %3.73 %
Expected long-term rate of return on plan assets6.00 %6.45 %6.60 %
Weighted Average Assumptions Used in Calculating the Net Periodic Benefit Cost for Other Postretirement Plans
 For the years ended December 31,
 202020192018
Discount rate3.15 %4.23 %3.55 %
Expected long-term rate of return on plan assets5.60 %6.00 %6.60 %
Assumed Health Care Cost Trend Rates
 For the years ended December 31,
 202020192018
Pre-65 health care cost trend rate7.00 %7.00 %6.50 %
Post-65 health care cost trend rateN/AN/AN/A
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)4.50 %4.50 %4.50 %
Year that the rate reaches the ultimate trend rate203320332028
Obligations and Funded Status
The following tables set forth a reconciliation of beginning and ending balances of the benefit obligation and fair value of plan assets, as well as the funded status of the Company's defined benefit pension and postretirement health care and life insurance benefit plans. International plans represent an immaterial percentage of total pension assets, liabilities and expense and, for reporting purposes, are combined with domestic plans.
Change in Benefit Obligation
Pension BenefitsOther Postretirement Benefits
For the years ended December 31,
2020201920202019
Benefit obligation — beginning of year$4,498 $4,000 $223 $220 
Service cost 4 4 — — 
Interest cost127 159 6 8 
Plan participants’ contributions— — 11 13 
Actuarial loss (gain)12 48 (2)6 
Amendments— — — (2)
Changes in assumptions437 488 16 19 
Benefits and expenses paid(203)(201)(34)(41)
Benefit obligation — end of year$4,875 $4,498 $220 $223 
Changes in assumptions in 2020 primarily included a $434 increase in the benefit obligation for pension benefits as a result of a decrease in the discount rate from 3.33% as of the December 31, 2019 valuation to 2.65% as of the December 31, 2020 valuation. Changes in assumptions in 2019 included a $508 increase in the benefit obligation for pension benefits as a result of a decrease in the discount rate from 4.35% as of the December 31, 2018 valuation to 3.33% as of the December 31, 2019 valuation.
The cash balance plan pension benefit obligation was $443 and $420 as of December 31, 2020 and 2019, respectively. The interest crediting rate was 3.30% in 2020, 2019, and 2018.
Change in Plan Assets
Pension BenefitsOther Postretirement Benefits
For the years ended December 31,
2020201920202019
Fair value of plan assets — beginning of year$3,914 $3,344 $75 $85 
Actual return on plan assets568 701 6 12 
Employer contributions [1]70 70 5 — 
Benefits paid [2](177)(176)(23)(22)
Expenses paid(12)(26)— — 
Foreign exchange adjustment— 1 — — 
Fair value of plan assets — end of year
$4,363 $3,914 $63 $75 
Funded status — end of year
$(512)$(584)$(157)$(148)
[1]Employer contributions in 2020 and 2019 to the U.S. qualified defined benefit pension plan were discretionary, made in cash, and did not include contributions of the Company’s common stock.
[2]Other postretirement benefits paid represent non-key employee postretirement medical benefits paid from the Company's prefunded trust fund.
The fair value of assets for pension benefits, and hence the funded status, presented in the table above excludes assets of $186 and $161 as of December 31, 2020 and 2019, respectively, held in rabbi trusts and designated for the non-qualified pension
plans. The assets do not qualify as plan assets; however, the assets are available to pay benefits for certain retired, terminated and active participants. Such assets are available to the Company’s general creditors in the event of insolvency. The rabbi trust assets consist of equity and fixed income investments. To the extent the fair value of these rabbi trusts were included in the table above, pension plan assets would have been $4,549 and $4,075 as of December 31, 2020 and 2019, respectively, and the funded status of pension benefits would have been $(326) and $(423) as of December 31, 2020 and 2019, respectively.
Defined Benefit Pension Plans with an Accumulated Benefit Obligation in Excess of Plan Assets
 As of December 31,
 20202019
Projected benefit obligation$4,875 $4,498 
Accumulated benefit obligation$4,875 $4,498 
Fair value of plan assets$4,363 $3,914 
Amounts Recognized in the Consolidated Balance Sheets
 Pension BenefitsOther Postretirement Benefits
As of December 31,
 2020201920202019
Other liabilities$512 $584 $157 $148 
Net Periodic Cost (Benefit)
 
Pension Benefits
Other Postretirement Benefits
For the years ended December 31,
 202020192018202020192018
Service cost$4 $4 $4 $— $— $— 
Interest cost127 159 142 6 8 7 
Expected return on plan assets(215)(226)(227)(4)(4)(7)
Amortization of prior service credit— — — (7)(7)(7)
Amortization of actuarial loss60 44 49 7 6 6 
Net periodic cost (benefit)$(24)$(19)$(32)$2 $3 $(1)
Amounts Recognized in Other Comprehensive Income (Loss)
 Pension BenefitsOther Postretirement Benefits
For the years ended December 31,
 202020192018202020192018
Amortization of actuarial loss$60 $44 $49 $7 $6 $6 
Amortization of prior service credit— — — (7)(7)(6)
Net loss arising during the year(106)(88)(91)(11)(18)3 
Prior service cost (credit)— — — — 2 — 
Total$(46)$(44)$(42)$(11)$(17)$3 
Amounts in Accumulated Other Comprehensive Income (Loss), Before Tax, not yet Recognized as Components of Net Periodic Benefit Cost
 Pension BenefitsOther Postretirement Benefits
As of December 31,
 202020192018202020192018
Net loss$(2,098)$(2,052)$(2,008)$(136)$(132)$(120)
Prior service credit— — — 60 67 72 
Total$(2,098)$(2,052)$(2,008)$(76)$(65)$(48)
Pension Plan Assets
Investment Strategy and Target Allocation
The overall investment strategy of the Pension Plan is to maximize total investment returns to provide sufficient funding for present and anticipated future benefit obligations within the constraints of a prudent level of portfolio risk and diversification. With respect to asset management, the oversight responsibility of the Pension Plan rests with The Hartford’s Pension Investment Committee composed of individuals whose responsibilities include establishing overall objectives and the setting of investment policy; selecting appropriate investment options and ranges; reviewing the asset allocation mix and asset allocation targets on a regular basis; and monitoring performance to determine whether or not the rate of return objectives are being met and that policy and guidelines are being followed. The Company believes that the asset allocation decision will be the single most important factor determining the long-term performance of the Pension Plan.
Target Asset Allocation
 Pension PlansOther Postretirement Plans
MinimumMaximumMinimumMaximum
Equity securities5 %35 %15 %45 %
Fixed income securities50 %70 %55 %85 %
Alternative assets— %45 %— %— %
Divergent market performance among different asset classes may, from time to time, cause the asset allocation to deviate from the desired asset allocation ranges. The asset allocation mix is reviewed on a periodic basis. If it is determined that an asset allocation mix rebalancing is required, future portfolio additions and withdrawals will be used, as necessary, to bring the allocation within tactical ranges.
The Pension Plan invests in commingled funds and partnerships managed by unaffiliated managers to gain exposure to emerging markets, equity, hedge funds and other alternative investments. These portfolios encompass multiple asset classes reflecting the current needs of the Pension Plan, the investment preferences and risk tolerance of the Pension Plan and the desired degree of diversification. These asset classes include publicly traded equities, bonds and alternative investments and are made up of individual investments in cash and cash equivalents, equity securities, debt securities, asset-backed securities, mortgage loans and hedge funds. Hedge fund investments represent a diversified portfolio of partnership investments in a variety of strategies.
In addition, the Company uses U.S. Treasury bond futures contracts and U.S. Treasury STRIPS in a duration overlay program to adjust the duration of Pension Plan assets to better match the duration of the benefit obligation.
Pension Plan Assets at Fair Value
As of December 31, 2020As of December 31, 2019
Asset CategoryLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Short-term investments:$75 $25 $— $100 $34 $54 $— $88 
Fixed Income Securities:
Corporate— 2,303 39 2,342 — 2,058 27 2,085 
RMBS— 41 1 42 — 61 — 61 
U.S. Treasuries— 47 — 47 — 101 — 101 
Foreign government— 16 9 25 — 17 1 18 
CMBS— 30 — 30 — 32 — 32 
Other fixed income [1]— 137 — 137 — 96 1 97 
  Mortgage Loans— — 161 161 — — 131 131 
Equity Securities:
Domestic513 — — 513 429 1 — 430 
International271 — — 271 261 — — 261 
Total pension plan assets at fair value, in the fair value hierarchy [2]$859 $2,599 $210 $3,668 $724 $2,420 $160 $3,304 
Other Investments, at net asset value [3]:
Private Market Alternatives451 358 
Hedge funds224 212 
Total pension plan assets at fair value$859 $2,599 $210 $4,343 $724 $2,420 $160 $3,874 
[1]Includes ABS, municipal bonds, and CDOs.
[2]Excludes approximately $20 and $40 as of December 31, 2020 and 2019, respectively, of investment receivables net of investment payables that are excluded from this disclosure requirement because they are trade receivables in the ordinary course of business where the carrying amount approximates fair value.
[3]Investments that are measured at net asset value per share or an equivalent and have not been classified in the fair value hierarchy.
The tables below provide fair value level 3 rollforwards for the Pension Plan Assets for which significant unobservable inputs ("Level 3") are used in the fair value measurement on a recurring basis. The Pension Plan classifies the fair value of financial instruments within Level 3 if there are no observable markets for
the instruments or, in the absence of active markets, if one or more of the significant inputs used to determine fair value are based on the Pension Plan’s own assumptions. Therefore, the gains and losses in the tables below include changes in fair value due to both observable and unobservable factors.
Pension Plan Asset Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
Assets
Corporate
RMBS
Foreign government
Mortgage loans
Other [1]
Totals
Fair Value as of January 1, 2020$27 $— $1 $131 $1 $160 
Realized gains (losses), net— — — — (1)(1)
Changes in unrealized gains, net1 — — 4 1 6 
Purchases14 1 9 32 — 56 
Settlements— — — — — — 
Sales(3)— — (6)— (9)
Transfers into Level 3— — — — — — 
Transfers out of Level 3— — (1)— (1)(2)
Fair Value as of December 31, 2020$39 $1 $9 $161 $— $210 
Fair Value as of January 1, 2019
$14 $1 $2 $133 $1 $151 
Realized gains, net3 — — — — 3 
Changes in unrealized gains, net2 — — 4 — 6 
Purchases7 — — — — 7 
Settlements— — — — — — 
Sales(3)(1)(1)(6)— (11)
Transfers into Level 34 — — — — 4 
Transfers out of Level 3— — — — — — 
Fair Value as of December 31, 2019
$27 $— $1 $131 $1 $160 
[1]"Other" includes U.S. Treasuries, Other fixed income and CMBS investments.
During the year ended December 31, 2020, transfers into and (out) of Level 3 are primarily attributable to the appearance of or lack thereof of market observable information and the re-evaluation of the observability of pricing inputs.
During the year ended December 31, 2019, transfers into and (out) of Level 3 are primarily attributable to the appearance of or
lack thereof of market observable information and the re-evaluation of the observability of pricing inputs.
There was less than $1 in Company common stock included in the Pension Plan’s assets as of December 31, 2020 and 2019.
Other Postretirement Plan Assets at Fair Value
As of December 31, 2020As of December 31, 2019
Asset CategoryLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Short-term investments$2 $— $— $2 $3 $— $— $3 
Fixed Income Securities:
Corporate— 16 — 16 — 18 — 18 
RMBS— 9 — 9 — 12 — 12 
U.S. Treasuries— 16 — 16 — 20 — 20 
CMBS— 1 — 1 — 1 — 1 
Other fixed income— 2 — 2 — 2 — 2 
Equity Securities:
Large-cap17 — — 17 19 — — 19 
Total other postretirement plan assets at fair value$19 $44 $— $63 $22 $53 $— $75 
There was no Company common stock included in the other postretirement benefit plan assets as of December 31, 2020 and 2019.
Concentration of Risk
In order to minimize risk, the Pension Plan maintains a listing of permissible and prohibited investments. In addition, the Pension Plan has certain concentration limits and investment quality
requirements imposed on permissible investment options. Permissible investments include U.S. equity, international equity, alternative asset and fixed income investments including derivative instruments. Permissible derivative instruments include futures contracts, options, swaps, currency forwards, caps or floors and may be used to control risk or enhance return but will not be used for leverage purposes.
Securities specifically prohibited from purchase include, but are not limited to: shares or fixed income instruments issued by The Hartford, short sales of any type within long-only portfolios, non-derivative securities involving the use of margin, leveraged floaters and inverse floaters, including money market obligations, natural resource real properties such as oil, gas or timber and precious metals.
Other than U.S. government and certain U.S. government agencies backed by the full faith and credit of the U.S. government, the Pension Plan does not have any material exposure to any concentration risk of a single issuer.
Expected Employer Contributions
The Company does not have a 2021 required minimum funding contribution for the U.S. qualified defined benefit pension plan. The Company has not determined whether, and to what extent, contributions may be made to the U. S. qualified defined benefit pension plan in 2021. The Company will monitor the funded status of the U.S. qualified defined benefit pension plan during 2021 to make this determination.
Benefit Payments

Amounts of Benefits Expected to be Paid over the next Ten Years from Pension and other Postretirement Plans as of December 31, 2020
Pension BenefitsOther Postretirement Benefits
2021$223 $22 
2022229 20 
2023235 18 
2024242 17 
2025246 15 
2026 - 20301,252 59 
Total$2,427 $151