THG 2018 Annual Report

SCHEDULE II THE HANOVER INSURANCE GROUP, INC. CONDENSED FINANCIAL INFORMATION OF REGISTRANT PARENT COMPANY ONLY STATEMENTS OF INCOME YEARS ENDED DECEMBER 31 2018 2017 2016 (in millions) Revenues Net investment income $ 11.8 $ 7.6 $ 4.9 Net realized losses from sales and other (0.5) (0.2) ² Interest income from loan to subsidiary 0.3 0.2 22.4 Other income 0.5 0.5 0.5 Total revenues 12.1 8.1 27.8 Expenses Interest expense 37.8 38.1 46.1 Employee benefit related expenses 5.1 7.4 7.0 Interest expense on loan from subsidiary 6.8 7.0 6.3 Loss from repayment of debt 1.9 ² 88.3 Other operating expenses 12.1 10.5 8.6 Total expenses 63.7 63.0 156.3 Net loss before income taxes and equity in income of subsidiaries (51.6) (54.9) (128.5) Income tax benefit 21.4 44.4 75.6 Equity in income of subsidiaries 288.4 196.1 207.0 Income from continuing operations 258.2 185.6 154.1 Gain from sale of Chaucer business (net of income tax expense of $42.5 in 2018) 131.9 ² ² Income from discontinued life business (net of income tax (expense) benefit of $(0.2), $(0.1) and $1.7 in 2018, 2017 and 2016) 0.9 0.6 1.0 Net income 391.0 186.2 155.1 Other comprehensive (loss) income, net of tax (122.4) 44.8 8.9 Comprehensive income $ 268.6 $ 231.0 $ 164.0 The condensed financial information should be read in conjunction with the consolidated financial statements and notes thereto. 148 THE HANOVER INSURANCE GROUP | 2018 ANNUAL REPORT