THG 2019 Proxy Statement

THE HANOVER INSURANCE GROUP 2019 PROXY STATEMENT 29 In addition to the financial metrics discussed above, for 2018, the following strategic objectives were considered: Strategic Objective Measure of Achievement • Responsibly Grow Business • Net premium written growth of 6.7%, driven by Personal Lines (7.7%) and Commercial Lines (6.0%) • Implemented a collaborative strategic investment review process integrating business unit leaders, our technology team and the newly established Enterprise Project Management Office • Enhance Quality of Earnings and Effectively Manage Capital • Successful execution of the Chaucer Sale and immediate deployment to our shareholders of $450 million of the associated proceeds in the form of a $4.75 special dividend and execution of a $250 million Accelerated Share Repurchase Agreement • Prudent expense discipline resulted in a 50 basis point improvement in overall expense ratio • Continue to Increase Relevance with Our Agency Partners • Launched Hanover Prestige offering in Personal Lines for higher-end homeowner’s coverage • Launched Life Sciences product offering in Commercial Lines • Strengthened our Specialty offerings with enhanced E&S and Cyber capabilities • Successful roll-out of digital quote/bind platform for agents targeting micro-business in healthcare and professional lines • Continued to assist agents with leveraging their data to develop underwriting insights and improved customer experience • Selected additional agency appointments in core Commercial, Personal and Specialty Lines • Enhance Focus on Innovation to Identify and Capitalize on New Opportunities; Leverage Data and Analytical Insights and Improve Efficiency and Customer Experience • Developed and implemented e-delivery option for Personal Lines policy declarations • Piloted and implemented digital claims capabilities to submit auto and property losses via photos and video • Further implementation of Micro-Commercial Lines platform for agents • Implemented technology to assist agents in developing more efficient workflows, including the upgrade of Personal Lines point of sale system in 13 States • Maintain Underwriting Excellence • Improved loss and loss adjustment expense ratio • Improved risk aggregation models and strengthened risk management function • Net premium written growth in select higher margin lines • Continue to Build the Organization of the Future by Creating and Investing in a Sustainable Organization and Culture that Aligns with Our Business Strategy • Founded Inclusion and Diversity Council • Commenced unconscious bias and leadership education program • Put “Mitigating Bias in Talent Life Cycle” to action through piloting nameless resumes • Expanded flexible work arrangements and conducted Company-wide work-space survey and idea crowd sourcing • Widespread Company and employee engagement on community efforts • Launch of Environmental, Social and Governance initiatives, including informational corporate responsibility website