The Hanover Insurance Group, Inc. (THG) 8-K Results of Operations and Financial Condition

Exhibit 99.2

FINANCIAL SUPPLEMENT
SECOND QUARTER 2017

THE HANOVER INSURANCE GROUP
FINANCIAL SUPPLEMENT
TABLE OF CONTENTS
Business Descriptions...................................................................................................	1
Financial Highlights........................................................................................................	2
Consolidated Financial Statements
Income Statements....................................................................................................	3
Balance Sheets..........................................................................................................	4
GAAP Underwriting Results
Consolidated..............................................................................................................	5-7
Commercial Lines.....................................................................................................	8-10
Personal Lines...........................................................................................................	11-13
Chaucer......................................................................................................................	14-16
Investments
Net Investment Income and Yields...........................................................................	17
Investment Portfolio...................................................................................................	18
Credit Quality and Duration of Fixed Maturities.....................................................	19
Top 10 Corporate and Municipal Fixed Maturity Holdings....................................	20
Reconciliation of Operating Income to Net Income................................................	21
Other Information
Non-GAAP Financial Measures...............................................................................	22
Corporate Information...............................................................................................	23
Market and Dividend Information.............................................................................	23
Financial Strength and Debt Ratings.......................................................................	23

THE HANOVER INSURANCE GROUP

BASIS OF PRESENTATION

BUSINESS DESCRIPTIONS

COMMERCIAL LINES

Commercial multiple peril coverage insures businesses against third party liability from accidents occurring on their premises or arising out of their operations, such as injuries sustained from products sold. It also insures business property for damage, such as that caused by fire, wind, hail, water damage (except for flooding), theft and vandalism.

Commercial automobile coverage insures businesses against losses incurred from personal bodily injury, bodily injury to third parties, property damage to an insured’s vehicle, and property damage to other vehicles and property.

Workers’ compensation coverage insures employers against employee medical and indemnity claims resulting from injuries related to work. Workers’ compensation policies are often written in conjunction with other commercial policies.

Other Commercial Lines is comprised of inland marine, which insures businesses against physical losses to property, such as contractor’s equipment, builders’ risk and goods in transit. We also offer underwriting and managing of program business, including to under-served markets where there are specialty coverage or risk management needs. Other Commercial Lines also includes bonds, which provides businesses with contract surety coverage in the event of performance or payment claims, and commercial surety coverage related to fiduciary or regulatory obligations. Also included in Other Commercial Lines coverages are umbrella, general liability, fire, specialty property, and professional and management liability.

PERSONAL LINES

Personal automobile coverage insures individuals against losses incurred from personal bodily injury, bodily injury to third parties, property damage to an insured’s vehicle, and property damage to other vehicles and other property.

Homeowners coverage insures individuals for losses to their residences and personal property, such as those caused by fire, wind, hail, water damage (except for flooding), theft and vandalism, and against third party liability claims.

Other Personal Lines are comprised of personal inland marine (jewelry, art, etc.), umbrella, fire, personal watercraft, earthquake and other miscellaneous coverages.

CHAUCER

The Chaucer reporting segment represents THG's international business written through Lloyd's and includes international marine, aviation and political, casualty, energy, property and treaty business.

Marine, Aviation & Political includes marine coverages that insure marine hull, liability, cargo and specie, fine art, and ports and terminals and political coverages that insure political violence (war, terrorism, aviation war), political risk and trade credit. It also includes aviation coverages that insure airline hull and liability, general aviation, refuellers, aviation products and satellite.

Casualty provides liability coverage worldwide for professional and commercial risks, credit and bond, crime and professional liability coverage for financial institutions, medical malpractice, excess workers’ compensation and accident and health, as well as syndicate participations.

Energy coverage, encompassing exploration and production, construction, downstream, operational power and renewables, insures energy businesses against physical damage, business interruption, control of well, seepage and pollution and liabilities. Energy also includes Nuclear, which predominantly provides coverage relating to power generation at nuclear power stations.

Property coverage insures property, including commercial and industrial businesses, against physical loss or damage and business interruption.

Treaty encompasses a broad range of casualty, property and marine exposures worldwide. International  casualty treaties cover motor, employer public, professional, pecuniary and miscellaneous liabilities. North American casualty comprises mainly excess of loss, written on an occurrence and claims made basis, and with a focus on medical malpractice supported by workers compensation clash business. Casualty also includes accident & health, a largely catastrophe exposed account, written for a range of perils. Property comprises mainly catastrophe and risk excess of loss for personal, commercial, excess and surplus lines carriers. Marine treaties, written on a whole account, specific or combined basis, focus on a broad range of assets and associated perils and liabilities.

OTHER

Included in Other are Opus, which provides investment advisory services to affiliates and also manages assets for unaffiliated institutions such as insurance companies, retirement plans and foundations; earnings on holding company assets; and a discontinued voluntary pools business.

1

THE HANOVER INSURANCE GROUP
FINANCIAL HIGHLIGHTS
	Q2			Q3			Q4			Q1			Q2			Jun-YTD		Jun-YTD
(In millions, except earnings per share)	2016			2016			2016			2017			2017			2016		2017
PREMIUMS
Gross premiums written	$	1,402.0		$	1,402.2		$	1,218.2		$	1,454.7		$	1,479.0		$	2,777.0	$	2,933.7
Net premiums written		1,221.6			1,250.9			1,082.0			1,186.8			1,275.7			2,365.9		2,462.5
Net premiums earned		1,145.5			1,160.9			1,170.4			1,181.3			1,181.2			2,296.8		2,362.5
EARNINGS
Operating income (loss) before interest and taxes	$	94.7		$	129.8		$	(22.1	)	$	69.1		$	118.9		$	215.1	$	188.0
Operating income (loss) after taxes		54.0			78.6			(19.7	)		40.8			72.3			125.5		113.1
Income (loss) from continuing operations		1.9			88.3			(12.2	)		45.2			78.4			80.0		123.6
Net income (loss)		2.0			88.4			(13.5	)		45.2			78.4			80.2		123.6
PER SHARE DATA (DILUTED)
Operating income (loss) after taxes	$	1.24		$	1.83		$	(0.46	)	$	0.95		$	1.69		$	2.89	$	2.64
Income (loss) from continuing operations		0.04			2.06			(0.29	)		1.05			1.83			1.84		2.88
Net income (loss)		0.05			2.06			(0.32	)		1.05			1.83			1.84		2.88
Weighted average shares outstanding (1)		43.4			43.0			42.5			42.9			42.8			43.5		42.9
BALANCE SHEET
	June 30			September 30			December 31			March 31			June 30
(In millions, except per share data)	2016			2016			2016			2017			2017
Total assets	$	14,163.6		$	14,363.7		$	14,220.4		$	14,490.8		$	14,792.7
Total loss and loss adjustment expense reserves		6,778.0			6,802.3			6,949.4			7,103.0			7,162.4
Total shareholders' equity		3,009.7			3,045.7			2,857.5			2,913.5			2,972.5
Total shareholders' equity, excluding net unrealized appreciation
depreciation on investments, net of tax		2,686.2			2,724.3			2,671.5			2,708.5			2,747.7
U.S. Property and Casualty Companies
Statutory surplus	$	2,152.6		$	2,218.5		$	2,173.4		$	2,229.5		$	2,006.3
Premium to surplus ratio	1.76:1			1.73:1			1.79:1			1.76:1			1.98:1
Book value per share	$	70.58		$	72.08		$	67.40		$	68.44		$	70.18
Book value per share, excluding net unrealized appreciation
depreciation on investments, net of tax	$	62.99		$	64.48		$	63.01		$	63.62		$	64.87
Tangible book value per share (total book value excluding goodwill
and intangibles)	$	64.11		$	65.74		$	61.17		$	62.20		$	63.88
Shares outstanding		42.7			42.3			42.4			42.6			42.4
Total debt/equity		26.5	%		26.2	%		27.5	%		27.0	%		26.5	%
Total debt/total capital		21.0	%		20.8	%		21.6	%		21.3	%		20.9	%
(1) Weighted average shares outstanding and per diluted share amounts in the fourth quarter of 2016 exclude common stock equivalents, as the impact of these instruments was anti-dilutive.

2

THE HANOVER INSURANCE GROUP
CONSOLIDATED INCOME STATEMENTS
	Three Months ended June 30								Six Months ended June 30
(In millions)	2017		2016			% Change			2017		2016			% Change
REVENUES
Premiums earned	$	1,181.2	$	1,145.5			3.1		$	2,362.5	$	2,296.8			2.9
Net investment income		72.3		69.1			4.6			143.4		137.4			4.4
Net realized investment gains (losses)		5.9		(0.7	)	N/M				7.8		0.8			875.0
Fees and other income		6.7		8.1			(17.3	)		13.3		14.6			(8.9	)
Total revenues		1,266.1		1,222.0			3.6			2,527.0		2,449.6			3.2
LOSSES AND EXPENSES
Losses and loss adjustment expenses		725.0		729.7			(0.6	)		1,491.5		1,429.3			4.4
Amortization of deferred acquisition costs		264.6		254.4			4.0			531.0		513.5			3.4
Interest expense		12.2		15.6			(21.8	)		24.2		30.3			(20.1	)
Gain on disposal of U.K. motor business		-		(0.4	)	N/M				-		(1.2	)	N/M
Net loss from repayment of debt		-		86.1		N/M				-		86.1		N/M
Other operating expenses		153.3		143.7			6.7			310.3		290.6			6.8
Total losses and expenses		1,155.1		1,229.1			(6.0	)		2,357.0		2,348.6			0.4
Income (loss) from continuing operations before income taxes		111.0		(7.1	)	N/M				170.0		101.0			68.3
Income tax expense (benefit)		32.6		(9.0	)	N/M				46.4		21.0			121.0
Income from continuing operations		78.4		1.9		N/M				123.6		80.0			54.5
Discontinued operations		-		0.1		N/M				-		0.2		N/M
Net income	$	78.4	$	2.0		N/M			$	123.6	$	80.2			54.1

3

THE HANOVER INSURANCE GROUP
CONSOLIDATED BALANCE SHEETS
	June 30			December 31
(In millions, except per share data)	2017			2016			% Change
ASSETS
Investments:
Fixed maturities, at fair value (amortized cost of $7,372.8 and $7,235.1)	$	7,509.7		$	7,331.3			2.4
Equity securities, at fair value (cost of $490.1 and $498.4)		605.5			584.4			3.6
Other investments		604.3			533.8			13.2
Total investments		8,719.5			8,449.5			3.2
Cash and cash equivalents		317.8			282.6			12.5
Accrued investment income		60.5			61.7			(1.9	)
Premiums and accounts receivable, net		1,599.4			1,438.1			11.2
Reinsurance recoverable on paid and unpaid losses and unearned premiums		2,701.1			2,611.8			3.4
Deferred acquisition costs		547.1			517.5			5.7
Deferred income taxes		73.7			115.1			(36.0	)
Goodwill		185.2			184.8			0.2
Other assets		509.7			479.8			6.2
Assets of discontinued operations		78.7			79.5			(1.0	)
Total assets	$	14,792.7		$	14,220.4			4.0
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Loss and loss adjustment expense reserves	$	7,162.4		$	6,949.4			3.1
Unearned premiums		2,776.0			2,561.0			8.4
Expenses and taxes payable		671.3			728.0			(7.8	)
Reinsurance premiums payable		334.7			251.9			32.9
Debt		786.7			786.4			-
Liabilities of discontinued operations		89.1			86.2			3.4
Total liabilities		11,820.2			11,362.9			4.0
SHAREHOLDERS' EQUITY
Preferred stock, par value $0.01 per share;
20.0 million shares authorized; none issued		-			-		-
Common stock, par value $0.01 per share; 300.0 million shares
authorized; 60.5 million shares issued		0.6			0.6		-
Additional paid-in capital		1,852.0			1,846.7			0.3
Accumulated other comprehensive income		106.9			62.8			70.2
Retained earnings		1,956.6			1,875.6			4.3
Treasury stock at cost (18.1 and 18.1 million shares)		(943.6	)		(928.2	)		1.7
Total shareholders' equity		2,972.5			2,857.5			4.0
Total liabilities and shareholders' equity	$	14,792.7		$	14,220.4			4.0

4

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CONSOLIDATED
Three Months ended June 30
	2017															2016
	Commercial			Personal												Commercial			Personal
(In millions, except percentage data)	Lines			Lines			Chaucer			Other			Total			Lines			Lines			Chaucer			Other			Total
Gross premiums written	$	685.2		$	453.5		$	340.3		$	-		$	1,479.0		$	662.9		$	416.6		$	322.5		$	-		$	1,402.0
Net premiums written	$	591.6		$	430.5		$	253.6		$	-		$	1,275.7		$	579.9		$	395.3		$	246.4		$	-		$	1,221.6
Net premiums earned	$	591.2		$	391.3		$	198.7		$	-		$	1,181.2		$	574.7		$	364.7		$	206.1		$	-		$	1,145.5
Losses and LAE:
Current accident year, excluding catastrophe losses		335.8			235.7			111.7			-			683.2			312.9			221.2			129.6			-			663.7
Prior accident year unfavorable (favorable)    reserve development, excluding catastrophe    losses		-			-			(15.6	)		0.3			(15.3	)		22.1			0.9			(8.3	)		0.3			15.0
Current accident year catastrophe losses		43.4			13.3			2.2			-			58.9			26.6			9.7			26.0			-			62.3
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.8	)		-			(1.0	)		-			(1.8	)		(0.7	)		1.5			(12.1	)		-			(11.3	)
Total losses and LAE		378.4			249.0			97.3			0.3			725.0			360.9			233.3			135.2			0.3			729.7
Amortization of deferred acquisition costs and other    underwriting expenses		210.5			112.8			83.4			0.6			407.3			208.7			102.1			77.4			0.3			388.5
GAAP underwriting profit (loss)		2.3			29.5			18.0			(0.9	)		48.9			5.1			29.3			(6.5	)		(0.6	)		27.3
Net investment income		41.3			17.4			11.3			2.3			72.3			39.1			17.1			11.3			1.6			69.1
Other income		2.0			2.8			1.2			0.7			6.7			2.3			2.7			2.4			0.7			8.1
Other operating expenses		(2.4	)		(1.8	)		(0.8	)		(4.0	)		(9.0	)		(2.5	)		(1.7	)		(1.7	)		(3.9	)		(9.8	)
Operating income (loss) before income taxes	$	43.2		$	47.9		$	29.7		$	(1.9	)	$	118.9		$	44.0		$	47.4		$	5.5		$	(2.2	)	$	94.7
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		56.8	%		60.2	%		56.3	%	N/M				57.9	%		54.5	%		60.7	%		62.9	%	N/M				57.9	%
Prior accident year unfavorable (favorable)    reserve development, excluding catastrophe    losses		-			-			(7.9	)%	N/M				(1.3	)%		3.8	%		0.2	%		(4.0	)%	N/M				1.3	%
Current accident year catastrophe losses		7.3	%		3.4	%		1.1	%	N/M				5.0	%		4.6	%		2.7	%		12.6	%	N/M				5.5	%
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.1	)%		-			(0.5	)%	N/M				(0.2	)%		(0.1	)%		0.4	%		(5.9	)%	N/M				(1.0	)%
Total loss and LAE ratio		64.0	%		63.6	%		49.0	%	N/M				61.4	%		62.8	%		64.0	%		65.6	%	N/M				63.7	%
Expense ratio		35.4	%		28.2	%		42.0	%	N/M				34.2	%		36.1	%		27.3	%		37.6	%	N/M				33.6	%
Combined ratio		99.4	%		91.8	%		91.0	%	N/M				95.6	%		98.9	%		91.3	%		103.2	%	N/M				97.3	%

5

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CONSOLIDATED
Six Months ended June 30
	2017															2016
	Commercial			Personal												Commercial			Personal
(In millions, except percentage data)	Lines			Lines			Chaucer			Other			Total			Lines			Lines			Chaucer			Other			Total
Gross premiums written	$	1,403.2		$	836.7		$	693.8		$	-		$	2,933.7		$	1,343.0		$	773.4		$	660.6		$	-		$	2,777.0
Net premiums written	$	1,216.9		$	792.6		$	453.0		$	-		$	2,462.5		$	1,184.2		$	732.3		$	449.4		$	-		$	2,365.9
Net premiums earned	$	1,179.5		$	773.1		$	409.9		$	-		$	2,362.5		$	1,146.1		$	723.3		$	427.4		$	-		$	2,296.8
Losses and LAE:
Current accident year, excluding catastrophe    losses		675.1			473.1			219.4			-			1,367.6			633.7			436.9			271.5			-			1,342.1
Prior accident year unfavorable (favorable)    reserve development, excluding catastrophe    losses		(0.1	)		0.1			(17.9	)		0.6			(17.3	)		42.2			0.2			(38.0	)		0.6			5.0
Current accident year catastrophe losses		79.8			53.7			14.9			-			148.4			45.8			20.2			36.2			-			102.2
Prior accident year unfavorable (favorable) catastrophe loss development		(0.8	)		-			(6.4	)		-			(7.2	)		(1.0	)		2.8			(21.8	)		-			(20.0	)
Total losses and LAE		754.0			526.9			210.0			0.6			1,491.5			720.7			460.1			247.9			0.6			1,429.3
Amortization of deferred acquisition costs and other underwriting expenses		425.9			225.1			168.1			1.2			820.3			416.6			205.3			163.5			0.7			786.1
GAAP underwriting profit (loss)		(0.4	)		21.1			31.8			(1.8	)		50.7			8.8			57.9			16.0			(1.3	)		81.4
Net investment income		81.6			34.5			23.7			3.6			143.4			78.5			34.5			22.0			2.4			137.4
Other income		3.9			5.7			2.3			1.4			13.3			4.2			5.5			3.5			1.4			14.6
Other operating expenses		(4.5	)		(3.5	)		(3.2	)		(8.2	)		(19.4	)		(4.8	)		(3.4	)		(2.3	)		(7.8	)		(18.3	)
Operating income (loss) before income taxes	$	80.6		$	57.8		$	54.6		$	(5.0	)	$	188.0		$	86.7		$	94.5		$	39.2		$	(5.3	)	$	215.1
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		57.2	%		61.3	%		53.5	%	N/M				57.8	%		55.2	%		60.4	%		63.5	%	N/M				58.5	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses		-			-			(4.4	)%	N/M				(0.7	)%		3.7	%		-			(8.9	)%	N/M				0.2	%
Current accident year catastrophe losses		6.8	%		6.9	%		3.7	%	N/M				6.3	%		4.0	%		2.8	%		8.5	%	N/M				4.5	%
Prior accident year unfavorable (favorable) catastrophe loss development		(0.1	)%		-			(1.6	)%	N/M				(0.3	)%		(0.1	)%		0.4	%		(5.1	)%	N/M				(0.9	)%
Total loss and LAE ratio		63.9	%		68.2	%		51.2	%	N/M				63.1	%		62.8	%		63.6	%		58.0	%	N/M				62.3	%
Expense ratio		35.9	%		28.5	%		41.0	%	N/M				34.4	%		36.2	%		27.7	%		38.3	%	N/M				33.9	%
Combined ratio		99.8	%		96.7	%		92.2	%	N/M				97.5	%		99.0	%		91.3	%		96.3	%	N/M				96.2	%

6

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
CONSOLIDATED
	Q2			Q3			Q4			Q1			Q2			Jun-YTD			Jun-YTD
(In millions, except percentage data)	2016			2016			2016			2017			2017			2016			2017
Gross premiums written	$	1,402.0		$	1,402.2		$	1,218.2		$	1,454.7		$	1,479.0		$	2,777.0		$	2,933.7
Net premiums written	$	1,221.6		$	1,250.9		$	1,082.0		$	1,186.8		$	1,275.7		$	2,365.9		$	2,462.5
Net premiums earned	$	1,145.5		$	1,160.9		$	1,170.4		$	1,181.3		$	1,181.2		$	2,296.8		$	2,362.5
Losses and LAE:
Current accident year, excluding catastrophe losses		663.7			673.2			684.0			684.4			683.2			1,342.1			1,367.6
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		15.0			(8.1	)		143.4			(2.0	)		(15.3	)		5.0			(17.3	)
Current accident year catastrophe losses		62.3			27.6			30.2			89.5			58.9			102.2			148.4
Prior accident year favorable catastrophe    loss development		(11.3	)		(0.7	)		(14.2	)		(5.4	)		(1.8	)		(20.0	)		(7.2	)
Total losses and LAE		729.7			692.0			843.4			766.5			725.0			1,429.3			1,491.5
Amortization of deferred acquisition costs    and other underwriting expenses		388.5			405.0			421.0			413.0			407.3			786.1			820.3
GAAP underwriting profit (loss)	$	27.3		$	63.9		$	(94.0	)	$	1.8		$	48.9		$	81.4		$	50.7
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		57.9	%		58.0	%		58.3	%		57.9	%		57.9	%		58.5	%		57.8	%
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		1.3	%		(0.7	)%		12.3	%		(0.2	)%		(1.3	)%		0.2	%		(0.7	)%
Current accident year catastrophe losses		5.5	%		2.4	%		2.6	%		7.6	%		5.0	%		4.5	%		6.3	%
Prior accident year favorable catastrophe loss development		(1.0	)%		(0.1	)%		(1.2	)%		(0.5	)%		(0.2	)%		(0.9	)%		(0.3	)%
Total loss and LAE ratio		63.7	%		59.6	%		72.0	%		64.8	%		61.4	%		62.3	%		63.1	%
Expense ratio		33.6	%		34.6	%		35.7	%		34.7	%		34.2	%		33.9	%		34.4	%
Combined ratio		97.3	%		94.2	%		107.7	%		99.5	%		95.6	%		96.2	%		97.5	%
Combined ratio, excluding catastrophe losses		92.8	%		91.9	%		106.3	%		92.4	%		90.8	%		92.6	%		91.5	%
Current accident year combined ratio, excluding catastrophe losses		91.5	%		92.6	%		94.0	%		92.6	%		92.1	%		92.4	%		92.2	%

7

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
COMMERCIAL LINES
Three Months ended June 30
	2017															2016
	Multiple						Workers'									Multiple						Workers'
(In millions, except percentage data)	Peril			Auto			Comp			Other			Total			Peril			Auto			Comp			Other			Total
Net premiums written	$	191.4		$	78.5		$	70.9		$	250.8		$	591.6		$	191.6		$	78.0		$	66.7		$	243.6		$	579.9
Net premiums earned	$	194.5		$	78.2		$	74.7		$	243.8		$	591.2		$	191.6		$	76.3		$	67.9		$	238.9		$	574.7
Losses and LAE:
Current accident year, excluding catastrophe losses		102.9			52.1			46.4			134.4			335.8			89.8			52.7			46.5			123.9			312.9
Prior accident year unfavorable    (favorable) reserve development,    excluding catastrophe losses		-			-			-			-			-			13.9			4.2			(6.5	)		10.5			22.1
Current accident year catastrophe losses		26.6			0.9			-			15.9			43.4			17.6			0.4			-			8.6			26.6
Prior accident year unfavorable    (favorable) catastrophe loss    development		-			-			-			(0.8	)		(0.8	)		(0.1	)		-			-			(0.6	)		(0.7	)
Total losses and LAE		129.5			53.0			46.4			149.5			378.4			121.2			57.3			40.0			142.4			360.9
Amortization of deferred acquisition costs    and other underwriting expenses														210.5															208.7
GAAP underwriting profit														2.3															5.1
Net investment income														41.3															39.1
Other income														2.0															2.3
Other operating expenses														(2.4	)														(2.5	)
Operating income before income taxes													$	43.2														$	44.0
Loss and LAE ratio:
Current accident year, excluding    catastrophe losses		52.9	%		66.6	%		62.1	%		55.1	%		56.8	%		46.9	%		69.1	%		68.6	%		51.9	%		54.5	%
Prior accident year unfavorable    (favorable) reserve development,    excluding catastrophe losses		-			-			-			-			-			7.3	%		5.5	%		(9.6	)%		4.4	%		3.8	%
Current accident year catastrophe losses		13.7	%		1.2	%		-			6.5	%		7.3	%		9.2	%		0.5	%		-			3.6	%		4.6	%
Prior accident year unfavorable    (favorable) catastrophe loss    development		-			-			-			(0.3	)%		(0.1	)%		(0.1	)%		-			-			(0.3	)%		(0.1	)%
Total loss and LAE ratio		66.6	%		67.8	%		62.1	%		61.3	%		64.0	%		63.3	%		75.1	%		59.0	%		59.6	%		62.8	%
Expense ratio														35.4	%														36.1	%
Combined ratio														99.4	%														98.9	%
Change in policies in force		6.2	%		-			11.7	%		6.1	%		6.1	%		5.2	%		(3.2	)%		(3.0	)%		4.1	%		2.6	%
Retention		85.3	%		80.6	%		80.1	%	N/M				83.0	%		85.9	%		79.8	%		79.3	%	N/M				83.5	%

8

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
COMMERCIAL LINES
Six Months ended June 30
	2017															2016
	Multiple						Workers'									Multiple						Workers'
(In millions, except percentage data)	Peril			Auto			Comp			Other			Total			Peril			Auto			Comp			Other			Total
Net premiums written	$	394.4		$	161.5		$	160.1		$	500.9		$	1,216.9		$	389.6		$	157.2		$	148.8		$	488.6		$	1,184.2
Net premiums earned	$	392.4		$	155.5		$	147.5		$	484.1		$	1,179.5		$	379.6		$	152.5		$	134.5		$	479.5		$	1,146.1
Losses and LAE:
Current accident year, excluding    catastrophe losses		216.3			105.8			92.5			260.5			675.1			184.0			106.5			90.7			252.5			633.7
Prior accident year unfavorable    (favorable) reserve development,    excluding catastrophe losses		-			-			-			(0.1	)		(0.1	)		21.4			7.2			(10.9	)		24.5			42.2
Current accident year catastrophe losses		48.1			1.5			-			30.2			79.8			31.4			0.9			-			13.5			45.8
Prior accident year unfavorable    (favorable) catastrophe loss    development		1.2			(0.1	)		-			(1.9	)		(0.8	)		(1.9	)		-			-			0.9			(1.0	)
Total losses and LAE		265.6			107.2			92.5			288.7			754.0			234.9			114.6			79.8			291.4			720.7
Amortization of deferred acquisition costs    and other underwriting expenses														425.9															416.6
GAAP underwriting profit (loss)														(0.4	)														8.8
Net investment income														81.6															78.5
Other income														3.9															4.2
Other operating expenses														(4.5	)														(4.8	)
Operating income before income taxes													$	80.6														$	86.7
Loss and LAE ratio:
Current accident year, excluding    catastrophe losses		55.1	%		68.0	%		62.7	%		53.8	%		57.2	%		48.5	%		69.9	%		67.4	%		52.6	%		55.2	%
Prior accident year unfavorable    (favorable) reserve development,    excluding catastrophe losses		-			-			-			-			-			5.6	%		4.7	%		(8.1	)%		5.1	%		3.7	%
Current accident year catastrophe losses		12.3	%		1.0	%		-			6.2	%		6.8	%		8.3	%		0.6	%		-			2.8	%		4.0	%
Prior accident year unfavorable    (favorable) catastrophe loss    development		0.3	%		(0.1	)%		-			(0.4	)%		(0.1	)%		(0.5	)%		-			-			0.2	%		(0.1	)%
Total loss and LAE ratio		67.7	%		68.9	%		62.7	%		59.6	%		63.9	%		61.9	%		75.2	%		59.3	%		60.7	%		62.8	%
Expense ratio														35.9	%														36.2	%
Combined ratio														99.8	%														99.0	%
Change in policies in force		6.2	%		-			11.7	%		6.1	%		6.1	%		5.2	%		(3.2	)%		(3.0	)%		4.1	%		2.6	%
Retention		86.1	%		81.1	%		81.1	%	N/M				83.9	%		85.9	%		79.8	%		77.8	%	N/M				83.1	%

9

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
COMMERCIAL LINES
	Q2			Q3			Q4			Q1			Q2			Jun-YTD			Jun-YTD
(In millions, except percentage data)	2016			2016			2016			2017			2017			2016			2017
Gross premiums written	$	662.9		$	730.0		$	613.2		$	718.0		$	685.2		$	1,343.0		$	1,403.2
Net premiums written	$	579.9		$	647.3		$	530.0		$	625.3		$	591.6		$	1,184.2		$	1,216.9
Net premiums earned	$	574.7		$	587.2		$	584.7		$	588.3		$	591.2		$	1,146.1		$	1,179.5
Losses and LAE:
Current accident year, excluding catastrophe losses		312.9			336.0			338.4			339.3			335.8			633.7			675.1
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		22.1			19.3			161.5			(0.1	)		-			42.2			(0.1	)
Current accident year catastrophe losses		26.6			16.4			11.6			36.4			43.4			45.8			79.8
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.7	)		1.3			(4.0	)		-			(0.8	)		(1.0	)		(0.8	)
Total losses and LAE		360.9			373.0			507.5			375.6			378.4			720.7			754.0
Amortization of deferred acquisition costs and other    underwriting expenses		208.7			210.6			211.6			215.4			210.5			416.6			425.9
GAAP underwriting profit (loss)	$	5.1		$	3.6		$	(134.4	)	$	(2.7	)	$	2.3		$	8.8		$	(0.4	)
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		54.5	%		57.2	%		57.9	%		57.6	%		56.8	%		55.2	%		57.2	%
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		3.8	%		3.3	%		27.6	%		-			-			3.7	%		-
Current accident year catastrophe losses		4.6	%		2.8	%		2.0	%		6.2	%		7.3	%		4.0	%		6.8	%
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.1	)%		0.2	%		(0.7	)%		-			(0.1	)%		(0.1	)%		(0.1	)%
Total loss and LAE ratio		62.8	%		63.5	%		86.8	%		63.8	%		64.0	%		62.8	%		63.9	%
Expense ratio		36.1	%		35.7	%		36.0	%		36.4	%		35.4	%		36.2	%		35.9	%
Combined ratio		98.9	%		99.2	%		122.8	%		100.2	%		99.4	%		99.0	%		99.8	%
Combined ratio, excluding catastrophe losses		94.4	%		96.2	%		121.5	%		94.0	%		92.2	%		95.1	%		93.1	%
Current accident year combined ratio, excluding catastrophe losses		90.6	%		92.9	%		93.9	%		94.0	%		92.2	%		91.4	%		93.1	%

10

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
PERSONAL LINES
Three Months ended June 30
	2017												2016
(In millions, except percentage data)	Auto			Home			Other			Total			Auto			Home			Other			Total
Net premiums written	$	269.6		$	150.6		$	10.3		$	430.5		$	245.1		$	140.1		$	10.1		$	395.3
Net premiums earned	$	245.1		$	136.6		$	9.6		$	391.3		$	226.4		$	128.6		$	9.7		$	364.7
Losses and LAE:
Current accident year, excluding catastrophe losses		168.2			63.7			3.8			235.7			157.8			59.3			4.1			221.2
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		-			-			-			-			(1.3	)		0.8			1.4			0.9
Current accident year catastrophe losses		1.9			11.3			0.1			13.3			1.1			8.5			0.1			9.7
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.1	)		-			0.1			-			(0.2	)		1.6			0.1			1.5
Total losses and LAE		170.0			75.0			4.0			249.0			157.4			70.2			5.7			233.3
Amortization of deferred acquisition costs and other    underwriting expenses											112.8												102.1
GAAP underwriting profit											29.5												29.3
Net investment income											17.4												17.1
Other income											2.8												2.7
Other operating expenses											(1.8	)											(1.7	)
Operating income before income taxes										$	47.9											$	47.4
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		68.7	%		46.6	%		39.6	%		60.2	%		69.7	%		46.1	%		42.2	%		60.7	%
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		-			-			-			-			(0.6	)%		0.6	%		14.4	%		0.2	%
Current accident year catastrophe losses		0.7	%		8.3	%		1.1	%		3.4	%		0.5	%		6.7	%		1.1	%		2.7	%
Prior accident year unfavorable (favorable)    catastrophe loss development		-			-			1.0	%		-			(0.1	)%		1.2	%		1.0	%		0.4	%
Total loss and LAE ratio		69.4	%		54.9	%		41.7	%		63.6	%		69.5	%		54.6	%		58.7	%		64.0	%
Expense ratio											28.2	%											27.3	%
Combined ratio											91.8	%											91.3	%
Change in policies in force		3.4	%		3.4	%		(11.0	)%		2.9	%		(2.3	)%		(0.9	)%		(12.4	)%		(2.0	)%
Retention		85.6	%		84.6	%	N/M				85.1	%		84.2	%		82.7	%	N/M				83.5	%

11

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
PERSONAL LINES
Six Months ended June 30
	2017												2016
(In millions, except percentage data)	Auto			Home			Other			Total			Auto			Home			Other			Total
Net premiums written	$	509.2		$	265.0		$	18.4		$	792.6		$	467.6		$	246.5		$	18.2		$	732.3
Net premiums earned	$	483.7		$	270.4		$	19.0		$	773.1		$	448.2		$	255.9		$	19.2		$	723.3
Losses and LAE:
Current accident year, excluding catastrophe losses		336.7			129.2			7.2			473.1			317.2			111.7			8.0			436.9
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		-			-			0.1			0.1			(2.1	)		0.8			1.5			0.2
Current accident year catastrophe losses		3.6			49.9			0.2			53.7			1.6			18.4			0.2			20.2
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.3	)		0.2			0.1			-			(0.1	)		2.8			0.1			2.8
Total losses and LAE		340.0			179.3			7.6			526.9			316.6			133.7			9.8			460.1
Amortization of deferred acquisition costs and other    underwriting expenses											225.1												205.3
GAAP underwriting profit											21.1												57.9
Net investment income											34.5												34.5
Other income											5.7												5.5
Other operating expenses											(3.5	)											(3.4	)
Operating income before income taxes										$	57.8											$	94.5
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		69.6	%		47.8	%		37.9	%		61.3	%		70.8	%		43.6	%		41.6	%		60.4	%
Prior accident year unfavorable (favorable) reserve    development, excluding catastrophe losses		-			-			0.5	%		-			(0.5	)%		0.3	%		7.8	%		-
Current accident year catastrophe losses		0.8	%		18.4	%		1.1	%		6.9	%		0.3	%		7.2	%		1.1	%		2.8	%
Prior accident year unfavorable (favorable)    catastrophe loss development		(0.1	)%		0.1	%		0.5	%		-			-			1.1	%		0.5	%		0.4	%
Total loss and LAE ratio		70.3	%		66.3	%		40.0	%		68.2	%		70.6	%		52.2	%		51.0	%		63.6	%
Expense ratio											28.5	%											27.7	%
Combined ratio											96.7	%											91.3	%
Change in policies in force		3.4	%		3.4	%		(11.0	)%		2.9	%		(2.3	)%		(0.9	)%		(12.4	)%		(2.0	)%
Retention		85.7	%		84.1	%	N/M				85.0	%		84.3	%		82.1	%	N/M				83.3	%

12

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
PERSONAL LINES
	Q2			Q3			Q4			Q1			Q2			Jun-YTD			Jun-YTD
(In millions, except percentage data)	2016			2016			2016			2017			2017			2016			2017
Gross premiums written	$	416.6		$	428.7		$	402.5		$	383.2		$	453.5		$	773.4		$	836.7
Net premiums written	$	395.3		$	407.5		$	381.4		$	362.1		$	430.5		$	732.3		$	792.6
Net premiums earned	$	364.7		$	371.5		$	376.7		$	381.8		$	391.3		$	723.3		$	773.1
Losses and LAE:
Current accident year, excluding catastrophe losses		221.2			226.7			220.9			237.4			235.7			436.9			473.1
Prior accident year unfavorable (favorable) reserve development, excluding    catastrophe losses		0.9			(1.1	)		5.2			0.1			-			0.2			0.1
Current accident year catastrophe losses		9.7			10.8			9.7			40.4			13.3			20.2			53.7
Prior accident year unfavorable catastrophe loss development		1.5			1.5			2.0			-			-			2.8			-
Total losses and LAE		233.3			237.9			237.8			277.9			249.0			460.1			526.9
Amortization of deferred acquisition costs and other underwriting expenses		102.1			110.3			116.3			112.3			112.8			205.3			225.1
GAAP underwriting profit (loss)	$	29.3		$	23.3		$	22.6		$	(8.4	)	$	29.5		$	57.9		$	21.1
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		60.7	%		61.1	%		58.7	%		62.2	%		60.2	%		60.4	%		61.3	%
Prior accident year unfavorable (favorable) reserve development, excluding    catastrophe losses		0.2	%		(0.3	)%		1.4	%		-			-			-			-
Current accident year catastrophe losses		2.7	%		2.9	%		2.6	%		10.6	%		3.4	%		2.8	%		6.9	%
Prior accident year unfavorable catastrophe loss development		0.4	%		0.4	%		0.5	%		-			-			0.4	%		-
Total loss and LAE ratio		64.0	%		64.1	%		63.2	%		72.8	%		63.6	%		63.6	%		68.2	%
Expense ratio		27.3	%		29.0	%		30.2	%		28.8	%		28.2	%		27.7	%		28.5	%
Combined ratio		91.3	%		93.1	%		93.4	%		101.6	%		91.8	%		91.3	%		96.7	%
Combined ratio, excluding catastrophe losses		88.2	%		89.8	%		90.3	%		91.0	%		88.4	%		88.1	%		89.8	%
Current accident year combined ratio, excluding catastrophe losses		88.0	%		90.1	%		88.9	%		91.0	%		88.4	%		88.1	%		89.8	%

13

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CHAUCER
Three Months ended June 30
	2017														2016
		Marine,													Marine,
		Aviation													Aviation
(In millions, except percentage data)		& Political		Casualty		Energy		Property		Treaty		Total			& Political		Casualty		Energy		Property		Treaty		Total
Gross premiums written		$	65.4	$	65.4	$	57.6	$	27.7	$	124.2	$	340.3		$	73.2	$	58.0	$	63.1	$	19.6	$	108.6	$	322.5
Net premiums written		$	51.6	$	52.6	$	41.5	$	16.6	$	91.3	$	253.6		$	53.6	$	49.8	$	45.1	$	16.6	$	81.3	$	246.4
Net premiums earned		$	52.5	$	46.6	$	26.1	$	12.5	$	61.0	$	198.7		$	53.4	$	48.9	$	30.6	$	12.4	$	60.8	$	206.1
Losses and LAE:
Current accident year, excluding    catastrophe losses													111.7													129.6
Prior accident year favorable reserve    development, excluding catastrophe    losses													(15.6	)												(8.3	)
Current accident year catastrophe losses													2.2													26.0
Prior accident year favorable catastrophe    loss development													(1.0	)												(12.1	)
Total losses and LAE													97.3													135.2
Amortization of deferred acquisition costs    and other underwriting expenses													83.4													77.4
GAAP underwriting profit (loss)													18.0													(6.5	)
Net investment income													11.3													11.3
Other income													1.2													2.4
Other operating expenses													(0.8	)												(1.7	)
Operating income before income taxes												$	29.7												$	5.5
Loss and LAE ratio:
Current accident year, excluding    catastrophe losses													56.3	%												62.9	%
Prior accident year favorable reserve    development, excluding catastrophe    losses													(7.9	)%												(4.0	)%
Current accident year catastrophe losses													1.1	%												12.6	%
Prior accident year favorable catastrophe    loss development													(0.5	)%												(5.9	)%
Total loss and LAE ratio													49.0	%												65.6	%
Expense ratio													42.0	%												37.6	%
Combined ratio													91.0	%												103.2	%

14

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CHAUCER
Six Months ended June 30
	2017														2016
		Marine,														Marine,
		Aviation														Aviation
(In millions, except percentage data)		& Political		Casualty		Energy		Property		Treaty		Total				& Political		Casualty		Energy		Property		Treaty		Total
Gross premiums written		$	150.5	$	118.8	$	99.2	$	50.9	$	274.4	$	693.8			$	165.3	$	113.4	$	102.9	$	32.4	$	246.6	$	660.6
Net premiums written		$	105.7	$	92.1	$	53.4	$	27.8	$	174.0	$	453.0			$	112.0	$	96.5	$	57.4	$	22.5	$	161.0	$	449.4
Net premiums earned		$	112.7	$	91.2	$	60.1	$	25.1	$	120.8	$	409.9			$	111.3	$	99.4	$	75.6	$	23.6	$	117.5	$	427.4
Losses and LAE:
Current accident year, excluding    catastrophe losses													219.4														271.5
Prior accident year favorable reserve    development, excluding catastrophe    losses													(17.9	)													(38.0	)
Current accident year catastrophe losses													14.9														36.2
Prior accident year favorable catastrophe    loss development													(6.4	)													(21.8	)
Total losses and LAE													210.0														247.9
Amortization of deferred acquisition costs    and other underwriting expenses													168.1														163.5
GAAP underwriting profit													31.8														16.0
Net investment income													23.7														22.0
Other income													2.3														3.5
Other operating expenses													(3.2	)													(2.3	)
Operating income before income taxes												$	54.6													$	39.2
Loss and LAE ratio:
Current accident year, excluding    catastrophe losses													53.5	%													63.5	%
Prior accident year favorable reserve    development, excluding catastrophe    losses													(4.4	)%													(8.9	)%
Current accident year catastrophe losses													3.7	%													8.5	%
Prior accident year favorable catastrophe loss development													(1.6	)%													(5.1	)%
Total loss and LAE ratio													51.2	%													58.0	%
Expense ratio													41.0	%													38.3	%
Combined ratio													92.2	%													96.3	%

15

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
CHAUCER
	Q2			Q3			Q4			Q1			Q2			Jun-YTD			Jun-YTD
(In millions, except percentage data)	2016			2016			2016			2017			2017			2016			2017
Gross premiums written	$	322.5		$	243.5		$	202.5		$	353.5		$	340.3		$	660.6		$	693.8
Net premiums written	$	246.4		$	196.1		$	170.6		$	199.4		$	253.6		$	449.4		$	453.0
Net premiums earned	$	206.1		$	202.2		$	209.0		$	211.2		$	198.7		$	427.4		$	409.9
Losses and LAE:
Current accident year, excluding catastrophe losses		129.6			110.4			124.7			107.7			111.7			271.5			219.4
Prior accident year favorable reserve development, excluding catastrophe losses		(8.3	)		(26.6	)		(30.7	)		(2.3	)		(15.6	)		(38.0	)		(17.9	)
Current accident year catastrophe losses		26.0			0.4			8.9			12.7			2.2			36.2			14.9
Prior accident year favorable catastrophe loss development		(12.1	)		(3.5	)		(12.2	)		(5.4	)		(1.0	)		(21.8	)		(6.4	)
Total losses and LAE		135.2			80.7			90.7			112.7			97.3			247.9			210.0
Amortization of deferred acquisition costs and other underwriting expenses		77.4			83.7			91.8			84.7			83.4			163.5			168.1
GAAP underwriting profit (loss)	$	(6.5	)	$	37.8		$	26.5		$	13.8		$	18.0		$	16.0		$	31.8
Loss and LAE ratio:
Current accident year, excluding catastrophe losses		62.9	%		54.6	%		59.7	%		51.0	%		56.3	%		63.5	%		53.5	%
Prior accident year favorable reserve development, excluding catastrophe losses		(4.0	)%		(13.2	)%		(14.7	)%		(1.1	)%		(7.9	)%		(8.9	)%		(4.4	)%
Current accident year catastrophe losses		12.6	%		0.2	%		4.2	%		6.1	%		1.1	%		8.5	%		3.7	%
Prior accident year favorable catastrophe loss development		(5.9	)%		(1.7	)%		(5.8	)%		(2.6	)%		(0.5	)%		(5.1	)%		(1.6	)%
Total loss and LAE ratio		65.6	%		39.9	%		43.4	%		53.4	%		49.0	%		58.0	%		51.2	%
Expense ratio		37.6	%		41.4	%		43.9	%		40.1	%		42.0	%		38.3	%		41.0	%
Combined ratio		103.2	%		81.3	%		87.3	%		93.5	%		91.0	%		96.3	%		92.2	%
Combined ratio, excluding catastrophe losses		96.5	%		82.8	%		88.9	%		90.0	%		90.4	%		92.9	%		90.1	%
Current accident year combined ratio, excluding catastrophe losses		100.5	%		96.0	%		103.6	%		91.1	%		98.3	%		101.8	%		94.5	%

16

THE HANOVER INSURANCE GROUP
NET INVESTMENT INCOME AND YIELDS
	Q2			Q3			Q4			Q1			Q2			YTD			YTD
(In millions, except yields)	2016			2016			2016			2017			2017			2016			2017
Net Investment Income
Fixed maturities	$	61.3		$	59.8		$	62.9		$	60.9		$	61.4		$	122.4		$	122.3
Equity securities		4.8			4.4			5.1			4.3			5.0			9.1			9.3
Other investments		5.7			6.4			9.0			8.6			8.8			11.3			17.4
Investment expenses		(2.7	)		(2.8	)		(2.8	)		(2.7	)		(2.9	)		(5.4	)		(5.6	)
Total	$	69.1		$	67.8		$	74.2		$	71.1		$	72.3		$	137.4		$	143.4
Pre-tax Yields
Fixed maturities		3.56	%		3.43	%		3.44	%		3.38	%		3.37	%		3.55	%		3.37	%
Total		3.39	%		3.31	%		3.40	%		3.29	%		3.35	%		3.38	%		3.31	%
Pre-tax yields are calculated as annualized net investment income divided by the average of investment balances, excluding unrealized capital gains and losses, at the end of each month during the period.

17

THE HANOVER INSURANCE GROUP
INVESTMENT PORTFOLIO
June 30, 2017
(In millions)
												Change in			Change in
	Weighted								Net			Net			Net
	Average	Amortized		Fair		% of			Unrealized			Unrealized			Unrealized
Investment Type	Quality	Cost or Cost		Value		Total			Gain (Loss)			During Q2			YTD
Fixed maturities:
U.S. Treasury and government agencies	AAA	$	393.3	$	393.8		4.4	%	$	0.5		$	1.3		$	1.9
Foreign government	AA+		224.0		228.4		2.5	%		4.4			(0.7	)		(0.5	)
Municipals:
Taxable	AA		968.4		999.8		11.1	%		31.4			0.8			1.8
Tax-exempt	AA		88.9		90.0		1.0	%		1.1			0.4			1.1
Corporate:
NAIC 1	A		1,744.9		1,782.1		19.7	%		37.2			7.4			10.1
NAIC 2	BBB		1,956.4		1,995.0		22.1	%		38.6			12.2			17.5
NAIC 3 and below	B+		381.7		400.6		4.4	%		18.9			0.8			3.1
Total corporate	BBB+		4,083.0		4,177.7		46.2	%		94.7			20.4			30.7
Asset backed:
Residential mortgage-backed	AAA		976.7		975.3		10.8	%		(1.4	)		2.7			2.6
Commercial mortgage-backed	AAA		574.9		580.7		6.4	%		5.8			3.5			2.1
Asset-backed	AA+		63.6		64.0		0.7	%		0.4			0.3			1.0
Total fixed maturities	A+		7,372.8		7,509.7		83.1	%		136.9			28.7			40.7
Equity securities			490.1		605.5		6.7	%		115.4			7.9			29.4
Other investments			600.4		604.3		6.7	%		3.9			-			-
Total investments			8,463.3		8,719.5		96.5	%		256.2			36.6			70.1
Cash and cash equivalents			317.8		317.8		3.5	%		-			-			-
Total		$	8,781.1	$	9,037.3		100.0	%	$	256.2		$	36.6		$	70.1

18

THE HANOVER INSURANCE GROUP
CREDIT QUALITY AND DURATION OF FIXED MATURITIES
June 30, 2017
(In millions)
CREDIT QUALITY OF FIXED MATURITIES
	Rating Agency	Amortized		Fair		% of Total
NAIC Designation	Equivalent Designation	Cost		Value		Fair Value
1	Aaa/Aa/A	$	5,003.0	$	5,082.8		67.7	%
2	Baa		1,982.1		2,020.3		26.9	%
3	Ba		193.3		203.4		2.7	%
4	B		185.1		192.8		2.6	%
5	Caa and lower		9.0		10.0		0.1	%
6	In or near default		0.3		0.4		-
Total fixed maturities		$	7,372.8	$	7,509.7		100.0	%
DURATION OF FIXED MATURITIES
		Amortized		Fair		% of Total
		Cost		Value		Fair Value
	0-2 Years	$	1,242.9	$	1,270.9		16.9	%
	2-4 Years		2,260.1		2,330.0		31.0	%
	4-6 Years		1,814.1		1,848.8		24.6	%
	6-8 Years		1,719.8		1,720.6		22.9	%
	8-10 Years		257.1		258.6		3.5	%
	10+ Years		78.8		80.8		1.1	%
	Total fixed maturities	$	7,372.8	$	7,509.7		100.0	%
	Weighted Average Duration		4.4

19

THE HANOVER INSURANCE GROUP
TOP 10 CORPORATE AND MUNICIPAL FIXED MATURITY HOLDINGS
June 30, 2017
(In millions, except percentage data)
Issuer	Amortized Cost		Fair Value		As a Percent of Invested Assets		S&P Ratings
US Bancorp	$	27.6	$	28.0		0.31%	A
Wells Fargo		27.1		27.3		0.30%	A
Verizon		26.3		27.3		0.30%	BBB+
Enterprise Holdings		26.1		25.9		0.29%	BBB+
Goldman Sachs		26.0		27.5		0.30%	BBB
Morgan Stanley		25.9		26.2		0.29%	BBB+
Key Bank		24.6		24.9		0.27%	BBB+
AvalonBay Communities		24.5		24.3		0.27%	A-
Anheuser-Busch InBev		24.3		25.0		0.28%	A-
Bank of New York Mellon		24.1		24.3		0.27%	A
Top 10 Corporate and Municipal Fixed	$	256.5	$	260.7		2.88%

20

THE HANOVER INSURANCE GROUP
RECONCILIATION OF OPERATING INCOME TO NET INCOME
	Three Months ended June 30												Six Months ended June 30
	2017						2016						2017						2016
(In millions, except per share data)	$			Per Share (Diluted)			$			Per Share (Diluted)			$			Per Share (Diluted)			$			Per Share (Diluted)
OPERATING INCOME (LOSS)
Commercial Lines	$	43.2					$	44.0					$	80.6					$	86.7
Personal Lines		47.9						47.4						57.8						94.5
Chaucer		29.7						5.5						54.6						39.2
Other		(1.9	)					(2.2	)					(5.0	)					(5.3	)
Total		118.9						94.7						188.0						215.1
Interest expense		(12.2	)					(15.6	)					(24.2	)					(30.3	)
Operating income before income taxes		106.7		$	2.49			79.1		$	1.82			163.8		$	3.82			184.8		$	4.25
Income tax expense on operating income		(34.4	)		(0.80	)		(25.1	)		(0.58	)		(50.7	)		(1.18	)		(59.3	)		(1.36	)
Operating income after income taxes		72.3			1.69			54.0			1.24			113.1			2.64			125.5			2.89
Non-operating items:
Net realized investment gains (losses)		5.9			0.14			(0.7	)		(0.02	)		7.8			0.18			0.8			0.02
Loss from repurchase of debt		-			-			(86.1	)		(1.98	)		-			-			(86.1	)		(1.98	)
Other		(1.6	)		(0.04	)		0.6			0.01			(1.6	)		(0.04	)		1.5			0.02
Income tax benefit on non-operating items		1.8			0.04			34.1			0.79			4.3			0.10			38.3			0.89
Income from continuing operations, net of taxes		78.4			1.83			1.9			0.04			123.6			2.88			80.0			1.84
Discontinued operations, net of taxes		-	��		-			0.1			0.01			-			-			0.2			-
NET INCOME	$	78.4		$	1.83		$	2.0		$	0.05		$	123.6		$	2.88		$	80.2		$	1.84

21

Non-GAAP Financial Measures

The Hanover uses non-GAAP financial measures as important measures of the Company’s operating performance, which we believe provide investors with additional information regarding management’s evaluation of our results of operations and financial performance. The Company's non-GAAP measures include operating income before interest expense and taxes, total operating income after taxes, total operating income after taxes per share, total book value per share, total book value per share excluding net unrealized gains and losses related to investments, net of tax, tangible book value per share and measures of operating income and loss and combined ratios excluding catastrophe losses (catastrophe losses as discussed here and in all other measures include catastrophe loss development) and reserve development. After-tax operating income EPS (sometimes referred to as “after-tax operating income per share”) is a non-GAAP measure. It is defined as net income (loss) excluding the after-tax impact of net realized investment gains (losses), as well as results from discontinued operations for a period divided by the average number of diluted shares of common stock.

Operating income before interest expense and taxes is net income, excluding interest expense on debt, income taxes and net realized investment gains and losses, because fluctuations in these gains and losses are determined by interest rates, financial markets and the timing of sales.  Operating income before interest expense and taxes also excludes net gains and losses on disposals of businesses, discontinued operations, restructuring costs, extraordinary items, the cumulative effect of accounting changes and certain other items. Operating income before interest expense and taxes is the sum of the operating income from:  Commercial Lines, Personal Lines, Chaucer, and Other.  The Hanover believes that measures of operating income before interest expense and taxes provide investors with a valuable measure of the performance of the Company’s ongoing businesses because they highlight net income attributable to the core operations of the business. 

Book value per share is total shareholders’ equity divided by the number of common shares outstanding. Book value per share excluding net unrealized gains and losses related to investments, net of tax is total shareholders’ equity excluding the after-tax effect of unrealized investment gains and losses divided by the number of common shares outstanding.  Tangible book value per share is total shareholders' equity, excluding goodwill and intangible assets, divided by the number of common shares outstanding.

The Hanover also provides measures of operating income and loss ratios that exclude the effects of catastrophe losses.  A catastrophe is a severe loss, resulting from natural or manmade events, including risks such as fire, hurricane, earthquake, windstorm, explosion, terrorism or other similar events. Each catastrophe has unique characteristics. Catastrophes are not predictable as to timing or loss amount in advance. The Hanover believes that providing certain financial metrics and trends excluding the effects of catastrophes is meaningful for investors to understand the variability of periodic earnings and loss ratios.                                               

Prior year reserve development, which can be favorable or unfavorable, represents changes in our estimate of the costs to pay claims from prior years. We believe that a discussion of operating income excluding prior year reserve development is helpful to investors since it provides insight into both our estimate of current year accident results and changes to prior-year reserve estimates.

Operating income before and after interest expense and taxes and measures of operating income that exclude the effects of catastrophe losses or reserve development should not be construed as substitutes for net income determined in accordance with GAAP. A reconciliation of income from continuing operations to operating income before interest expense and taxes and income from continuing operations per share to operating income after taxes per share for the three and six months ended June 30, 2017 and 2016 is set forth on page 21 of this document. The presentation of loss ratios calculated excluding the effects of reserve development and/or catastrophe losses should not be construed as a substitute for loss ratios determined in accordance with GAAP.

22

CORPORATE OFFICES AND							INDUSTRY RATINGS AS OF August 2, 2017				TRANSFER AGENT
PRINCIPAL SUBSIDIARIES
THE HANOVER INSURANCE GROUP, INC.								A.M.	Standard		Computershare Investor Services
440 Lincoln Street							Financial Strength Ratings	Best	& Poor's	Moody's	PO Box 30170
Worcester, MA 01653							The Hanover Insurance				College Station, TX  77842-3170
							Company	A	A	A3	1-800-317-4454
The Hanover Insurance Company							Citizens Insurance Company
440 Lincoln Street							of America	A	A	-
Worcester, MA 01653
											COMMON STOCK
Citizens Insurance Company of America								A.M.	Standard
808 North Highlander Way							Debt Ratings	Best	& Poor's	Moody's	Common stock of The Hanover Insurance Group is traded
Howell, MI 48843							The Hanover Insurance Group, Inc.				on the New York Stock Exchange under the symbol "THG".
							Senior Debt	bbb	BBB	Baa3
Chaucer Holdings Limited							Subordinated Debentures	bb+	BB+	Ba1
Plantation Place											INQUIRIES
30 Fenchurch Street
London											Oksana Lukasheva
EC3M 3AD											Vice President
											Investor Relations
MARKET AND DIVIDEND INFORMATION											(508) 855-2063
											olukasheva@hanover.com
The following tables set forth the high and low closing
sales prices of our common stock and cash dividends
for the periods indicated:											INVESTOR INFORMATION LINE
Quarter Ended	2017										Dial 1-800-407-5222 to receive additional printed information,
	Price Range				Dividends						fax-on-demand services or other prerecorded messages.
	High		Low		Per Share
March 31	$	91.58	$	83.09	$	0.500					Please visit our internet site at http:// www.Hanover.com
June 30	$	91.58	$	80.59	$	0.500
Quarter Ended	2016
	Price Range				Dividends
	High		Low		Per Share
March 31	$	90.68	$	76.90	$	0.460
June 30	$	91.15	$	80.41	$	0.460
September 30	$	84.58	$	74.10	$	0.460
December 31	$	91.66	$	74.88	$	0.500

23