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

Exhibit 99.2

FINANCIAL SUPPLEMENT
THIRD 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
		Q3				Q4				Q1				Q2				Q3				Sep-YTD			Sep-YTD
(In millions, except earnings per share)		2016				2016				2017				2017				2017				2016			2017
PREMIUMS
Gross premiums written	$		1,402.2		$		1,218.2		$		1,454.7		$		1,479.0		$		1,521.5		$		4,179.2	$		4,455.2
Net premiums written			1,250.9				1,082.0				1,186.8				1,275.7				1,322.5				3,616.8			3,785.0
Net premiums earned			1,160.9				1,170.4				1,181.3				1,181.2				1,226.9				3,457.7			3,589.4
EARNINGS
Operating income (loss) before interest and taxes	$		129.8		$		(22.1	)	$		69.1		$		118.9		$		13.1		$		344.9	$		201.1
Operating income (loss) after taxes			78.6				(19.7	)			40.8				72.3				4.7				204.1			117.8
Income (loss) from continuing operations			88.3				(12.2	)			45.2				78.4				12.3				168.3			135.9
Net income (loss)			88.4				(13.5	)			45.2				78.4				11.1				168.6			134.7
PER SHARE DATA (DILUTED)
Operating income (loss) after taxes	$		1.83		$		(0.46	)	$		0.95		$		1.69		$		0.11		$		4.71	$		2.74
Income (loss) from continuing operations			2.06				(0.29	)			1.05				1.83				0.28				3.89			3.17
Net income (loss)			2.06				(0.32	)			1.05				1.83				0.26				3.89			3.14
Weighted average shares outstanding (1)			43.0				42.5				42.9				42.8				42.9				43.3			42.9
BALANCE SHEET
	September 30				December 31					March 31				June 30			September 30
(In millions, except per share data)	2016				2016					2017				2017			2017
Total assets	$		14,363.7		$		14,220.4		$		14,490.8		$		14,792.7		$		15,389.3
Total loss and loss adjustment expense reserves			6,802.3				6,949.4				7,103.0				7,162.4				7,635.4
Total shareholders' equity			3,045.7				2,857.5				2,913.5				2,972.5				2,972.0
Total shareholders' equity, excluding net unrealized appreciation
depreciation on investments, net of tax			2,724.3				2,671.5				2,708.5				2,747.7				2,743.5
U.S. Property and Casualty Companies
Statutory surplus	$		2,218.5		$		2,173.4		$		2,229.5		$		2,006.3		$		2,061.9
Premium to surplus ratio		1.73:1				1.79:1				1.76:1				1.98:1				1.96:1
Book value per share	$		72.08		$		67.40		$		68.44		$		70.18		$		70.10
Book value per share, excluding net unrealized appreciation
depreciation on investments, net of tax	$		64.48		$		63.01		$		63.62		$		64.87		$		64.71
Tangible book value per share (total book value excluding goodwill
and intangibles)	$		65.74		$		61.17		$		62.20		$		63.88		$		63.49
Shares outstanding			42.3				42.4				42.6				42.4				42.4
Total debt/equity			26.2	%			27.5	%			27.0	%			26.5	%			26.5	%
Total debt/total capital			20.8	%			21.6	%			21.3	%			20.9	%			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 September 30										Nine Months ended September 30
(In millions)		2017				2016		% Change				2017				2016		% Change
REVENUES
Premiums earned	$		1,226.9		$		1,160.9		5.7		$		3,589.4		$		3,457.7			3.8
Net investment income			76.6				67.8		13.0				220.0				205.2			7.2
Net realized investment gains			13.4				4.2		219.0				21.2				5.0			324.0
Fees and other income			8.3				8.3	-					21.6				22.9			(5.7	)
Total revenues			1,325.2				1,241.2		6.8				3,852.2				3,690.8			4.4
													��
LOSSES AND EXPENSES
Losses and loss adjustment expenses			878.0				692.0		26.9				2,369.5				2,121.3			11.7
Amortization of deferred acquisition costs			275.1				257.9		6.7				806.1				771.4			4.5
Interest expense			12.1				12.5		(3.2	)			36.3				42.8			(15.2	)
Net loss from repayment of debt			-				-	N/M					-				86.1		N/M
Other operating expenses			151.1				154.7		(2.3	)			461.4				444.1			3.9
Total losses and expenses			1,316.3				1,117.1		17.8				3,673.3				3,465.7			6.0
Income from continuing operations before income taxes			8.9				124.1		(92.8	)			178.9				225.1			(20.5	)
Income tax expense (benefit)			(3.4	)			35.8		(109.5	)			43.0				56.8			(24.3	)
Income from continuing operations			12.3				88.3		(86.1	)			135.9				168.3			(19.3	)
Discontinued operations			(1.2	)			0.1	N/M					(1.2	)			0.3		N/M
Net income	$		11.1		$		88.4		(87.4	)	$		134.7		$		168.6			(20.1	)

3

THE HANOVER INSURANCE GROUP
CONSOLIDATED BALANCE SHEETS
		September 30				December 31
(In millions, except per share data)		2017				2016			% Change
ASSETS
Investments:
Fixed maturities, at fair value (amortized cost of $7,752.4 and $7,235.1)	$		7,890.5		$		7,331.3			7.6
Equity securities, at fair value (cost of $443.1 and $498.4)			566.5				584.4			(3.1	)
Other investments			616.6				533.8			15.5
Total investments			9,073.6				8,449.5			7.4
Cash and cash equivalents			227.2				282.6			(19.6	)
Accrued investment income			64.4				61.7			4.4
Premiums and accounts receivable, net			1,656.8				1,438.1			15.2
Reinsurance recoverable on paid and unpaid losses and unearned premiums			2,979.7				2,611.8			14.1
Deferred acquisition costs			562.5				517.5			8.7
Deferred income taxes			76.3				115.1			(33.7	)
Goodwill			185.3				184.8			0.3
Other assets			486.0				479.8			1.3
Assets of discontinued operations			77.5				79.5			(2.5	)
Total assets	$		15,389.3		$		14,220.4			8.2
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Loss and loss adjustment expense reserves	$		7,635.4		$		6,949.4			9.9
Unearned premiums			2,862.9				2,561.0			11.8
Expenses and taxes payable			676.0				728.0			(7.1	)
Reinsurance premiums payable			366.9				251.9			45.7
Debt			786.8				786.4			0.1
Liabilities of discontinued operations			89.3				86.2			3.6
Total liabilities			12,417.3				11,362.9			9.3
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			1,856.4				1,846.7			0.5
Accumulated other comprehensive income			114.0				62.8			81.5
Retained earnings			1,946.5				1,875.6			3.8
Treasury stock at cost (18.1 and 18.1 million shares)			(945.5	)			(928.2	)		1.9
Total shareholders' equity			2,972.0				2,857.5			4.0
Total liabilities and shareholders' equity	$		15,389.3		$		14,220.4			8.2

4

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CONSOLIDATED
Three Months ended September 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	$		772.8		$		462.0		$		286.7		$		-		$		1,521.5		$		730.0		$		428.7		$		243.5		$		-		$		1,402.2
Net premiums written	$		680.2		$		438.8		$		203.5		$		-		$		1,322.5		$		647.3		$		407.5		$		196.1		$		-		$		1,250.9
Net premiums earned	$		604.0		$		400.4		$		222.5		$		-		$		1,226.9		$		587.2		$		371.5		$		202.2		$		-		$		1,160.9
Losses and LAE:
Current accident year, excluding catastrophe losses			342.9				232.1				116.8				0.1				691.9				336.0				226.7				110.4				0.1				673.2
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				(12.5	)			0.3				(12.2	)			19.3				(1.1	)			(26.6	)			0.3				(8.1	)
Current accident year catastrophe losses			62.5				15.0				124.9				-				202.4				16.4				10.8				0.4				-				27.6
Prior accident year unfavorable (favorable) catastrophe loss development			(0.4	)			-				(7.5	)			-				(7.9	)			1.3				1.5				(3.5	)			-				(0.7	)
Total losses and LAE			405.0				247.1				221.7				0.4				874.2				373.0				237.9				80.7				0.4				692.0
Amortization of deferred acquisition costs and other underwriting expenses			212.7				112.5				88.5				0.6				414.3				210.6				110.3				83.7				0.4				405.0
GAAP underwriting profit (loss)			(13.7	)			40.8				(87.7	)			(1.0	)			(61.6	)			3.6				23.3				37.8				(0.8	)			63.9
Net investment income			42.1				17.8				13.4				3.3				76.6				39.0				17.1				10.3				1.4				67.8
Other income			2.1				2.8				2.7				0.7				8.3				2.2				2.9				2.5				0.7				8.3
Other operating expenses			(2.3	)			(1.7	)			(2.2	)			(4.0	)			(10.2	)			(2.3	)			(1.6	)			(2.2	)			(4.1	)			(10.2	)
Operating income (loss) before income taxes	$		28.2		$		59.7		$		(73.8	)	$		(1.0	)	$		13.1		$		42.5		$		41.7		$		48.4		$		(2.8	)	$		129.8
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			56.8	%			58.0	%			52.4	%		N/M					56.4	%			57.2	%			61.1	%			54.6	%		N/M					58.0	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				(5.6	)%		N/M					(1.0	)%			3.3	%			(0.3	)%			(13.2	)%		N/M					(0.7	)%
Current accident year catastrophe losses			10.4	%			3.7	%			56.2	%		N/M					16.5	%			2.8	%			2.9	%			0.2	%		N/M					2.4	%
Prior accident year unfavorable (favorable) catastrophe loss development			(0.1	)%			-				(3.4	)%		N/M					(0.6	)%			0.2	%			0.4	%			(1.7	)%		N/M					(0.1	)%
Total loss and LAE ratio			67.1	%			61.7	%			99.6	%		N/M					71.3	%			63.5	%			64.1	%			39.9	%		N/M					59.6	%
Expense ratio			35.0	%			27.5	%			39.8	%		N/M					33.5	%			35.7	%			29.0	%			41.4	%		N/M					34.6	%
Combined ratio			102.1	%			89.2	%			139.4	%		N/M					104.8	%			99.2	%			93.1	%			81.3	%		N/M					94.2	%

5

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CONSOLIDATED
Nine Months ended September 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	$		2,176.0		$		1,298.7		$		980.5		$		-		$		4,455.2		$		2,073.0		$		1,202.1		$		904.1		$		-		$		4,179.2
Net premiums written	$		1,897.1		$		1,231.4		$		656.5		$		-		$		3,785.0		$		1,831.5		$		1,139.8		$		645.5		$		-		$		3,616.8
Net premiums earned	$		1,783.5		$		1,173.5		$		632.4		$		-		$		3,589.4		$		1,733.3		$		1,094.8		$		629.6		$		-		$		3,457.7
Losses and LAE:
Current accident year, excluding catastrophe losses			1,018.0				705.2				336.2				0.1				2,059.5				969.7				663.6				381.9				0.1				2,015.3
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			(0.1	)			0.1				(30.4	)			0.9				(29.5	)			61.5				(0.9	)			(64.6	)			0.9				(3.1	)
Current accident year catastrophe losses			142.3				68.7				139.8				-				350.8				62.2				31.0				36.6				-				129.8
Prior accident year unfavorable (favorable) catastrophe loss development			(1.2	)			-				(13.9	)			-				(15.1	)			0.3				4.3				(25.3	)			-				(20.7	)
Total losses and LAE			1,159.0				774.0				431.7				1.0				2,365.7				1,093.7				698.0				328.6				1.0				2,121.3
Amortization of deferred acquisition costs and other underwriting expenses			638.6				337.6				256.6				1.8				1,234.6				627.2				315.6				247.2				1.1				1,191.1
GAAP underwriting profit (loss)			(14.1	)			61.9				(55.9	)			(2.8	)			(10.9	)			12.4				81.2				53.8				(2.1	)			145.3
Net investment income			123.7				52.3				37.1				6.9				220.0				117.5				51.6				32.3				3.8				205.2
Other income			6.0				8.5				5.0				2.1				21.6				6.4				8.4				6.0				2.1				22.9
Other operating expenses			(6.8	)			(5.2	)			(5.4	)			(12.2	)			(29.6	)			(7.1	)			(5.0	)			(4.5	)			(11.9	)			(28.5	)
Operating income (loss) before income taxes	$		108.8		$		117.5		$		(19.2	)	$		(6.0	)	$		201.1		$		129.2		$		136.2		$		87.6		$		(8.1	)	$		344.9
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			57.1	%			60.1	%			53.2	%		N/M					57.3	%			56.0	%			60.6	%			60.7	%		N/M					58.3	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				(4.8	)%		N/M					(0.8	)%			3.5	%			(0.1	)%			(10.3	)%		N/M					(0.1	)%
Current accident year catastrophe losses			8.0	%			5.9	%			22.1	%		N/M					9.8	%			3.6	%			2.8	%			5.8	%		N/M					3.8	%
Prior accident year unfavorable (favorable) catastrophe loss development			(0.1	)%			-				(2.2	)%		N/M					(0.4	)%			-				0.4	%			(4.0	)%		N/M					(0.6	)%
Total loss and LAE ratio			65.0	%			66.0	%			68.3	%		N/M					65.9	%			63.1	%			63.7	%			52.2	%		N/M					61.4	%
Expense ratio			35.6	%			28.2	%			40.6	%		N/M					34.1	%			36.0	%			28.2	%			39.3	%		N/M					34.1	%
Combined ratio			100.6	%			94.2	%			108.9	%		N/M					100.0	%			99.1	%			91.9	%			91.5	%		N/M					95.5	%

6

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
CONSOLIDATED
		Q3				Q4				Q1				Q2				Q3				Sep-YTD				Sep-YTD
(In millions, except percentage data)		2016				2016				2017				2017				2017				2016				2017
Gross premiums written	$		1,402.2		$		1,218.2		$		1,454.7		$		1,479.0		$		1,521.5		$		4,179.2		$		4,455.2
Net premiums written	$		1,250.9		$		1,082.0		$		1,186.8		$		1,275.7		$		1,322.5		$		3,616.8		$		3,785.0
Net premiums earned	$		1,160.9		$		1,170.4		$		1,181.3		$		1,181.2		$		1,226.9		$		3,457.7		$		3,589.4
Losses and LAE:
Current accident year, excluding catastrophe losses			673.2				684.0				684.4				683.2				691.9				2,015.3				2,059.5
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			(8.1	)			143.4				(2.0	)			(15.3	)			(12.2	)			(3.1	)			(29.5	)
Current accident year catastrophe losses			27.6				30.2				89.5				58.9				202.4				129.8				350.8
Prior accident year favorable catastrophe loss development			(0.7	)			(14.2	)			(5.4	)			(1.8	)			(7.9	)			(20.7	)			(15.1	)
Total losses and LAE			692.0				843.4				766.5				725.0				874.2				2,121.3				2,365.7
Amortization of deferred acquisition costs and other underwriting expenses			405.0				421.0				413.0				407.3				414.3				1,191.1				1,234.6
GAAP underwriting profit (loss)	$		63.9		$		(94.0	)	$		1.8		$		48.9		$		(61.6	)	$		145.3		$		(10.9	)
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			58.0	%			58.3	%			57.9	%			57.9	%			56.4	%			58.3	%			57.3	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			(0.7	)%			12.3	%			(0.2	)%			(1.3	)%			(1.0	)%			(0.1	)%			(0.8	)%
Current accident year catastrophe losses			2.4	%			2.6	%			7.6	%			5.0	%			16.5	%			3.8	%			9.8	%
Prior accident year favorable catastrophe loss development			(0.1	)%			(1.2	)%			(0.5	)%			(0.2	)%			(0.6	)%			(0.6	)%			(0.4	)%
Total loss and LAE ratio			59.6	%			72.0	%			64.8	%			61.4	%			71.3	%			61.4	%			65.9	%
Expense ratio			34.6	%			35.7	%			34.7	%			34.2	%			33.5	%			34.1	%			34.1	%
Combined ratio			94.2	%			107.7	%			99.5	%			95.6	%			104.8	%			95.5	%			100.0	%
Combined ratio, excluding catastrophe losses			91.9	%			106.3	%			92.4	%			90.8	%			88.9	%			92.3	%			90.6	%
Current accident year combined ratio, excluding catastrophe losses			92.6	%			94.0	%			92.6	%			92.1	%			89.9	%			92.4	%			91.4	%

7

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
COMMERCIAL LINES
Three Months ended September 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	$		240.2		$		87.9		$		81.6		$		270.5		$		680.2		$		229.3		$		81.7		$		73.6		$		262.7		$		647.3
Net premiums earned	$		204.2		$		78.5		$		75.6		$		245.7		$		604.0		$		195.6		$		76.4		$		69.9		$		245.3		$		587.2
Losses and LAE:
Current accident year, excluding catastrophe losses			107.0				53.4				46.4				136.1				342.9				98.3				54.4				48.0				135.3				336.0
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				-				-				-				9.1				1.9				(3.8	)			12.1				19.3
Current accident year catastrophe losses			18.4				3.8				-				40.3				62.5				11.5				1.7				-				3.2				16.4
Prior accident year unfavorable (favorable) catastrophe loss development			-				-				-				(0.4	)			(0.4	)			1.5				-				-				(0.2	)			1.3
Total losses and LAE			125.4				57.2				46.4				176.0				405.0				120.4				58.0				44.2				150.4				373.0
Amortization of deferred acquisition costs and other underwriting expenses																			212.7																				210.6
GAAP underwriting profit (loss)																			(13.7	)																			3.6
Net investment income																			42.1																				39.0
Other income																			2.1																				2.2
Other operating expenses																			(2.3	)																			(2.3	)
Operating income before income taxes																	$		28.2																		$		42.5
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			52.4	%			68.1	%			61.4	%			55.4	%			56.8	%			50.2	%			71.2	%			68.7	%			55.2	%			57.2	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				-				-				-				4.7	%			2.5	%			(5.4	)%			4.9	%			3.3	%
Current accident year catastrophe losses			9.0	%			4.8	%			-				16.4	%			10.4	%			5.8	%			2.2	%			-				1.3	%			2.8	%
Prior accident year unfavorable (favorable) catastrophe loss development			-				-				-				(0.2	)%			(0.1	)%			0.8	%			-				-				(0.1	)%			0.2	%
Total loss and LAE ratio			61.4	%			72.9	%			61.4	%			71.6	%			67.1	%			61.5	%			75.9	%			63.3	%			61.3	%			63.5	%
Expense ratio																			35.0	%																			35.7	%
Combined ratio																			102.1	%																			99.2	%
Change in policies in force			6.9	%			1.9	%			12.7	%			6.4	%			6.8	%			5.1	%			(3.2	)%			3.0	%			4.9	%			3.7	%
Retention			87.3	%			85.8	%			82.3	%		N/M					86.0	%			88.2	%			84.8	%			85.6	%		N/M					87.0	%

8

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
COMMERCIAL LINES
Nine Months ended September 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	$		634.6		$		249.4		$		241.7		$		771.4		$		1,897.1		$		618.9		$		238.9		$		222.4		$		751.3		$		1,831.5
Net premiums earned	$		596.6		$		234.0		$		223.1		$		729.8		$		1,783.5		$		575.2		$		228.9		$		204.4		$		724.8		$		1,733.3
Losses and LAE:
Current accident year, excluding catastrophe losses			323.3				159.2				138.9				396.6				1,018.0				282.3				160.9				138.7				387.8				969.7
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				-				(0.1	)			(0.1	)			30.5				9.1				(14.7	)			36.6				61.5
Current accident year catastrophe losses			66.5				5.3				-				70.5				142.3				42.9				2.6				-				16.7				62.2
Prior accident year unfavorable (favorable) catastrophe loss development			1.2				(0.1	)			-				(2.3	)			(1.2	)			(0.4	)			-				-				0.7				0.3
Total losses and LAE			391.0				164.4				138.9				464.7				1,159.0				355.3				172.6				124.0				441.8				1,093.7
Amortization of deferred acquisition costs and other underwriting expenses																			638.6																				627.2
GAAP underwriting profit (loss)																			(14.1	)																			12.4
Net investment income																			123.7																				117.5
Other income																			6.0																				6.4
Other operating expenses																			(6.8	)																			(7.1	)
Operating income before income taxes																	$		108.8																		$		129.2
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			54.2	%			68.1	%			62.3	%			54.4	%			57.1	%			49.1	%			70.3	%			67.9	%			53.6	%			56.0	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				-				-				-				5.3	%			4.0	%			(7.2	)%			5.0	%			3.5	%
Current accident year catastrophe losses			11.1	%			2.2	%			-				9.6	%			8.0	%			7.5	%			1.1	%			-				2.3	%			3.6	%
Prior accident year unfavorable (favorable) catastrophe loss development			0.2	%			-				-				(0.3	)%			(0.1	)%			(0.1	)%			-				-				0.1	%			-
Total loss and LAE ratio			65.5	%			70.3	%			62.3	%			63.7	%			65.0	%			61.8	%			75.4	%			60.7	%			61.0	%			63.1	%
Expense ratio																			35.6	%																			36.0	%
Combined ratio																			100.6	%																			99.1	%
Change in policies in force			6.9	%			1.9	%			12.7	%			6.4	%			6.8	%			5.1	%			(3.2	)%			3.0	%			4.9	%			3.7	%
Retention			86.6	%			82.7	%			81.5	%		N/M					84.7	%			86.8	%			81.5	%			80.3	%		N/M					84.5	%

9

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
COMMERCIAL LINES
		Q3				Q4				Q1				Q2				Q3				Sep-YTD				Sep-YTD
(In millions, except percentage data)		2016				2016				2017				2017				2017				2016				2017
Gross premiums written	$		730.0		$		613.2		$		718.0		$		685.2		$		772.8		$		2,073.0		$		2,176.0
Net premiums written	$		647.3		$		530.0		$		625.3		$		591.6		$		680.2		$		1,831.5		$		1,897.1
Net premiums earned	$		587.2		$		584.7		$		588.3		$		591.2		$		604.0		$		1,733.3		$		1,783.5
Losses and LAE:
Current accident year, excluding catastrophe losses			336.0				338.4				339.3				335.8				342.9				969.7				1,018.0
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			19.3				161.5				(0.1	)			-				-				61.5				(0.1	)
Current accident year catastrophe losses			16.4				11.6				36.4				43.4				62.5				62.2				142.3
Prior accident year unfavorable (favorable) catastrophe loss development			1.3				(4.0	)			-				(0.8	)			(0.4	)			0.3				(1.2	)
Total losses and LAE			373.0				507.5				375.6				378.4				405.0				1,093.7				1,159.0
Amortization of deferred acquisition costs and other underwriting expenses			210.6				211.6				215.4				210.5				212.7				627.2				638.6
GAAP underwriting profit (loss)	$		3.6		$		(134.4	)	$		(2.7	)	$		2.3		$		(13.7	)	$		12.4		$		(14.1	)
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			57.2	%			57.9	%			57.6	%			56.8	%			56.8	%			56.0	%			57.1	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			3.3	%			27.6	%			-			-					-				3.5	%			-
Current accident year catastrophe losses			2.8	%			2.0	%			6.2	%			7.3	%			10.4	%			3.6	%			8.0	%
Prior accident year unfavorable (favorable) catastrophe loss development			0.2	%			(0.7	)%			-				(0.1	)%			(0.1	)%			-				(0.1	)%
Total loss and LAE ratio			63.5	%			86.8	%			63.8	%			64.0	%			67.1	%			63.1	%			65.0	%
Expense ratio			35.7	%			36.0	%			36.4	%			35.4	%			35.0	%			36.0	%			35.6	%
Combined ratio			99.2	%			122.8	%			100.2	%			99.4	%			102.1	%			99.1	%			100.6	%
Combined ratio, excluding catastrophe losses			96.2	%			121.5	%			94.0	%			92.2	%			91.8	%			95.5	%			92.7	%
Current accident year combined ratio, excluding catastrophe losses			92.9	%			93.9	%			94.0	%			92.2	%			91.8	%			92.0	%			92.7	%

10

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
PERSONAL LINES
Three Months ended September 30
	2017																2016
(In millions, except percentage data)		Auto				Home				Other				Total				Auto				Home				Other				Total
Net premiums written	$		272.2		$		156.1		$		10.5		$		438.8		$		249.6		$		147.5		$		10.4		$		407.5
Net premiums earned	$		252.2		$		138.6		$		9.6		$		400.4		$		231.7		$		130.5		$		9.3		$		371.5
Losses and LAE:
Current accident year, excluding catastrophe losses			170.1				58.9				3.1				232.1				164.0				60.5				2.2				226.7
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				-				-				(1.3	)			-				0.2				(1.1	)
Current accident year catastrophe losses			1.3				13.5				0.2				15.0				3.7				7.0				0.1				10.8
Prior accident year unfavorable catastrophe loss development			-				-				-				-				-				1.5				-				1.5
Total losses and LAE			171.4				72.4				3.3				247.1				166.4				69.0				2.5				237.9
Amortization of deferred acquisition costs and other underwriting expenses															112.5																110.3
GAAP underwriting profit															40.8																23.3
Net investment income															17.8																17.1
Other income															2.8																2.9
Other operating expenses															(1.7	)															(1.6	)
Operating income before income taxes													$		59.7														$		41.7
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			67.5	%			42.5	%			32.3	%			58.0	%			70.8	%			46.4	%			23.6	%			61.1	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				-				-				(0.6	)%			-				2.2	%			(0.3	)%
Current accident year catastrophe losses			0.5	%			9.7	%			2.1	%			3.7	%			1.6	%			5.4	%			1.1	%			2.9	%
Prior accident year unfavorable catastrophe loss development			-				-				-				-				-				1.1	%			-				0.4	%
Total loss and LAE ratio			68.0	%			52.2	%			34.4	%			61.7	%			71.8	%			52.9	%			26.9	%			64.1	%
Expense ratio															27.5	%															29.0	%
Combined ratio															89.2	%															93.1	%
Change in policies in force			4.0	%			4.0	%			(10.4	)%			3.5	%			(0.6	)%			0.3	%			(11.7	)%			(0.6	)%
Retention			84.8	%			83.6	%		N/M					84.2	%			84.1	%			81.9	%		N/M					83.1	%

11

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
PERSONAL LINES
Nine Months ended September 30
	2017																2016
(In millions, except percentage data)		Auto				Home				Other				Total				Auto				Home				Other				Total
Net premiums written	$		781.4		$		421.1		$		28.9		$		1,231.4		$		717.2		$		394.0		$		28.6		$		1,139.8
Net premiums earned	$		735.9		$		409.0		$		28.6		$		1,173.5		$		679.9		$		386.4		$		28.5		$		1,094.8
Losses and LAE:
Current accident year, excluding catastrophe losses			506.8				188.1				10.3				705.2				481.2				172.2				10.2				663.6
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				0.1				0.1				(3.4	)			0.8				1.7				(0.9	)
Current accident year catastrophe losses			4.9				63.4				0.4				68.7				5.3				25.4				0.3				31.0
Prior accident year unfavorable (favorable) catastrophe loss development			(0.3	)			0.2				0.1				-				(0.1	)			4.3				0.1				4.3
Total losses and LAE			511.4				251.7				10.9				774.0				483.0				202.7				12.3				698.0
Amortization of deferred acquisition costs and other underwriting expenses															337.6																315.6
GAAP underwriting profit															61.9																81.2
Net investment income															52.3																51.6
Other income															8.5																8.4
Other operating expenses															(5.2	)															(5.0	)
Operating income before income taxes													$		117.5														$		136.2
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			68.9	%			45.9	%			36.1	%			60.1	%			70.8	%			44.5	%			35.8	%			60.6	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			-				-				0.3	%			-				(0.5	)%			0.2	%			6.0	%			(0.1	)%
Current accident year catastrophe losses			0.6	%			15.6	%			1.4	%			5.9	%			0.8	%			6.6	%			1.0	%			2.8	%
Prior accident year unfavorable (favorable) catastrophe loss development			-				-				0.3	%			-				-				1.1	%			0.4	%			0.4	%
Total loss and LAE ratio			69.5	%			61.5	%			38.1	%			66.0	%			71.1	%			52.4	%			43.2	%			63.7	%
Expense ratio															28.2	%															28.2	%
Combined ratio															94.2	%															91.9	%
Change in policies in force			4.0	%			4.0	%			(10.4	)%			3.5	%			(0.6	)%			0.3	%			(11.7	)%			(0.6	)%
Retention			85.4	%			83.9	%		N/M					84.7	%			84.3	%			82.0	%		N/M					83.2	%

12

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
PERSONAL LINES
		Q3				Q4				Q1				Q2				Q3				Sep-YTD				Sep-YTD
(In millions, except percentage data)		2016				2016				2017				2017				2017				2016				2017
Gross premiums written	$		428.7		$		402.5		$		383.2		$		453.5		$		462.0		$		1,202.1		$		1,298.7
Net premiums written	$		407.5		$		381.4		$		362.1		$		430.5		$		438.8		$		1,139.8		$		1,231.4
Net premiums earned	$		371.5		$		376.7		$		381.8		$		391.3		$		400.4		$		1,094.8		$		1,173.5
Losses and LAE:
Current accident year, excluding catastrophe losses			226.7				220.9				237.4				235.7				232.1				663.6				705.2
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			(1.1	)			5.2				0.1				-				-				(0.9	)			0.1
Current accident year catastrophe losses			10.8				9.7				40.4				13.3				15.0				31.0				68.7
Prior accident year unfavorable catastrophe loss development			1.5				2.0				-				-				-				4.3				-
Total losses and LAE			237.9				237.8				277.9				249.0				247.1				698.0				774.0
Amortization of deferred acquisition costs and other underwriting expenses			110.3				116.3				112.3				112.8				112.5				315.6				337.6
GAAP underwriting profit (loss)	$		23.3		$		22.6		$		(8.4	)	$		29.5		$		40.8		$		81.2		$		61.9
Loss and LAE ratio:
Current accident year, excluding catastrophe losses			61.1	%			58.7	%			62.2	%			60.2	%			58.0	%			60.6	%			60.1	%
Prior accident year unfavorable (favorable) reserve development, excluding catastrophe losses			(0.3	)%			1.4	%			-			-					-				(0.1	)%			-
Current accident year catastrophe losses			2.9	%			2.6	%			10.6	%			3.4	%			3.7	%			2.8	%			5.9	%
Prior accident year unfavorable catastrophe loss development			0.4	%			0.5	%			-				-				-				0.4	%			-
Total loss and LAE ratio			64.1	%			63.2	%			72.8	%			63.6	%			61.7	%			63.7	%			66.0	%
Expense ratio			29.0	%			30.2	%			28.8	%			28.2	%			27.5	%			28.2	%			28.2	%
Combined ratio			93.1	%			93.4	%			101.6	%			91.8	%			89.2	%			91.9	%			94.2	%
Combined ratio, excluding catastrophe losses			89.8	%			90.3	%			91.0	%			88.4	%			85.5	%			88.7	%			88.3	%
Current accident year combined ratio, excluding catastrophe losses			90.1	%			88.9	%			91.0	%			88.4	%			85.5	%			88.8	%			88.3	%

13

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CHAUCER
Three Months ended September 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	$	76.5	$		67.5	$		28.8	$		21.3	$		92.6		$				286.7			$		81.7	$		62.8	$		28.8	$		11.5	$		58.7		$				243.5
Net premiums written	$	59.5	$		54.3	$		21.6	$		4.7	$		63.4		$				203.5			$		64.9	$		52.2	$		18.8	$		10.2	$		50.0		$				196.1
Net premiums earned	$	59.7	$		50.0	$		26.7	$		8.4	$		77.7		$				222.5			$		61.7	$		45.4	$		25.2	$		11.7	$		58.2		$				202.2
Losses and LAE:
Current accident year, excluding catastrophe losses																			116.8																							110.4
Prior accident year favorable reserve development, excluding catastrophe losses																			(12.5			)																				(26.6			)
Current accident year catastrophe losses																			124.9																							0.4
Prior accident year favorable catastrophe loss development																			(7.5			)																				(3.5			)
Total losses and LAE																			221.7																							80.7
Amortization of deferred acquisition costs and other underwriting expenses																			88.5																							83.7
GAAP underwriting profit (loss)																			(87.7			)																				37.8
Net investment income																			13.4																							10.3
Other income																			2.7																							2.5
Other operating expenses																			(2.2			)																				(2.2			)
Operating income (loss) before income taxes															$				(73.8			)																$				48.4
Loss and LAE ratio:
Current accident year, excluding catastrophe losses																		52.4			%																				54.6			%
Prior accident year favorable reserve development, excluding catastrophe losses																		(5.6			)%																				(13.2			)%
Current accident year catastrophe losses																		56.2			%																				0.2			%
Prior accident year favorable catastrophe loss development																		(3.4			)%																				(1.7			)%
Total loss and LAE ratio																		99.6			%																				39.9			%
Expense ratio																		39.8			%																				41.4			%
Combined ratio																		139.4			%																				81.3			%

14

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING AND OPERATING INCOME INFORMATION AND RATIOS
CHAUCER
Nine Months ended September 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	$	227.0	$		186.3	$		128.0	$		72.2	$		367.0	$		980.5		$	247.0	$		176.2	$		131.7	$		43.9	$		305.3	$		904.1
Net premiums written	$	165.2	$		146.4	$		75.0	$		32.5	$		237.4	$		656.5		$	176.9	$		148.7	$		76.2	$		32.7	$		211.0	$		645.5
Net premiums earned	$	172.4	$		141.2	$		86.8	$		33.5	$		198.5	$		632.4		$	173.0	$		144.8	$		100.8	$		35.3	$		175.7	$		629.6
Losses and LAE:
Current accident year, excluding catastrophe losses																	336.2																		381.9
Prior accident year favorable reserve development, excluding catastrophe losses																	(30.4	)																	(64.6	)
Current accident year catastrophe losses																	139.8																		36.6
Prior accident year favorable catastrophe loss development																	(13.9	)																	(25.3	)
Total losses and LAE																	431.7																		328.6
Amortization of deferred acquisition costs and other underwriting expenses																	256.6																		247.2
GAAP underwriting profit (loss)																	(55.9	)																	53.8
Net investment income																	37.1																		32.3
Other income																	5.0																		6.0
Other operating expenses																	(5.4	)																	(4.5	)
Operating income (loss) before income taxes															$		(19.2	)															$		87.6
Loss and LAE ratio:
Current accident year, excluding catastrophe losses																	53.2	%																	60.7	%
Prior accident year favorable reserve development, excluding catastrophe losses																	(4.8	)%																	(10.3	)%
Current accident year catastrophe losses																	22.1	%																	5.8	%
Prior accident year favorable catastrophe loss development																	(2.2	)%																	(4.0	)%
Total loss and LAE ratio																	68.3	%																	52.2	%
Expense ratio																	40.6	%																	39.3	%
Combined ratio																	108.9	%																	91.5	%

15

THE HANOVER INSURANCE GROUP
GAAP UNDERWRITING INFORMATION AND RELATED RATIOS
	CHAUCER
			Q3				Q4				Q1				Q2				Q3				Sep-YTD				Sep-YTD
	(In millions, except percentage data)		2016				2016				2017				2017				2017				2016				2017
	Gross premiums written	$		243.5		$		202.5		$		353.5		$		340.3		$		286.7		$		904.1		$		980.5
	Net premiums written	$		196.1		$		170.6		$		199.4		$		253.6		$		203.5		$		645.5		$		656.5
	Net premiums earned	$		202.2		$		209.0		$		211.2		$		198.7		$		222.5		$		629.6		$		632.4
	Losses and LAE:
	Current accident year, excluding catastrophe losses			110.4				124.7				107.7				111.7				116.8				381.9				336.2
	Prior accident year favorable reserve development, excluding catastrophe losses			(26.6	)			(30.7	)			(2.3	)			(15.6	)			(12.5	)			(64.6	)			(30.4	)
	Current accident year catastrophe losses			0.4				8.9				12.7				2.2				124.9				36.6				139.8
	Prior accident year favorable catastrophe loss development			(3.5	)			(12.2	)			(5.4	)			(1.0	)			(7.5	)			(25.3	)			(13.9	)
	Total losses and LAE			80.7				90.7				112.7				97.3				221.7				328.6				431.7
	Amortization of deferred acquisition costs and other underwriting expenses			83.7				91.8				84.7				83.4				88.5				247.2				256.6
	GAAP underwriting profit (loss)	$		37.8		$		26.5		$		13.8		$		18.0		$		(87.7	)	$		53.8		$		(55.9	)
	Loss and LAE ratio:
	Current accident year, excluding catastrophe losses			54.6	%			59.7	%			51.0	%			56.3	%			52.4	%			60.7	%			53.2	%
	Prior accident year favorable reserve development, excluding catastrophe losses			(13.2	)%			(14.7	)%			(1.1	)%			(7.9	)%			(5.6	)%			(10.3	)%			(4.8	)%
	Current accident year catastrophe losses			0.2	%			4.2	%			6.1	%			1.1	%			56.2	%			5.8	%			22.1	%
	Prior accident year favorable catastrophe loss development			(1.7	)%			(5.8	)%			(2.6	)%			(0.5	)%			(3.4	)%			(4.0	)%			(2.2	)%
	Total loss and LAE ratio			39.9	%			43.4	%			53.4	%			49.0	%			99.6	%			52.2	%			68.3	%
	Expense ratio			41.4	%			43.9	%			40.1	%			42.0	%			39.8	%			39.3	%			40.6	%
	Combined ratio			81.3	%			87.3	%			93.5	%			91.0	%			139.4	%			91.5	%			108.9	%
	Combined ratio, excluding catastrophe losses			82.8	%			88.9	%			90.0	%			90.4	%			86.6	%			89.7	%			89.0	%
	Current accident year combined ratio, excluding catastrophe losses			96.0	%			103.6	%			91.1	%			98.3	%			92.2	%			100.0	%			93.8	%

16

THE HANOVER INSURANCE GROUP
NET INVESTMENT INCOME AND YIELDS
	Q3			Q4			Q1			Q2			Q3			YTD			YTD
(In millions, except yields)	2016			2016			2017			2017			2017			2016			2017
Net Investment Income
Fixed maturities	$	59.8		$	62.9		$	60.9		$	61.4		$	62.6		$	182.2		$	184.9
Equity securities		4.4			5.1			4.3			5.0			4.1			13.5			13.4
Other investments		6.4			9.0			8.6			8.8			12.6			17.7			30.0
Investment expenses		(2.8	)		(2.8	)		(2.7	)		(2.9	)		(2.7	)		(8.2	)		(8.3	)
Total	$	67.8		$	74.2		$	71.1		$	72.3		$	76.6		$	205.2		$	220.0
Pre-tax Yields
Fixed maturities		3.43	%		3.44	%		3.38	%		3.37	%		3.32	%		3.51	%		3.35	%
Total		3.31	%		3.40	%		3.29	%		3.35	%		3.40	%		3.36	%		3.34	%
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
September 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 Q3			YTD
Fixed maturities:
U.S. Treasury and government agencies	AAA	$	434.3	$	434.1		4.7	%	$	(0.2	)	$	(0.7	)	$	1.2
Foreign government	AA+		241.7		245.0		2.6	%		3.3			(1.1	)		(1.6	)
Municipals:
Taxable	AA		976.4		1,007.3		10.9	%		30.9			(0.5	)		1.3
Tax-exempt	AA		84.7		85.9		0.9	%		1.2			0.1			1.2
Corporate:
NAIC 1	A		1,911.8		1,948.1		20.9	%		36.3			(0.9	)		9.2
NAIC 2	BBB		2,021.3		2,062.5		22.2	%		41.2			2.6			20.1
NAIC 3 and below	B+		397.1		415.9		4.5	%		18.8			(0.1	)		3.0
Total corporate	BBB+		4,330.2		4,426.5		47.6	%		96.3			1.6			32.3
Asset-backed:
Residential mortgage-backed	AAA		1,032.8		1,033.1		11.1	%		0.3			1.7			4.3
Commercial mortgage-backed	AAA		592.0		598.2		6.4	%		6.2			0.4			2.5
Asset-backed	AAA		60.3		60.4		0.6	%		0.1			(0.3	)		0.7
Total fixed maturities	A+		7,752.4		7,890.5		84.8	%		138.1			1.2			41.9
Equity securities			443.1		566.5		6.1	%		123.4			8.0			37.4
Other investments			612.7		616.6		6.6	%		3.9			-			-
Total investments			8,808.2		9,073.6		97.5	%		265.4			9.2			79.3
Cash and cash equivalents			227.2		227.2		2.5	%		-			-			-
Total		$	9,035.4	$	9,300.8		100.0	%	$	265.4		$	9.2		$	79.3

18

THE HANOVER INSURANCE GROUP
CREDIT QUALITY AND DURATION OF FIXED MATURITIES
September 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	$	5,304.0		$	5,382.4		68.2	%
	2	Baa		2,046.9			2,087.8		26.5	%
	3	Ba		206.0			216.5		2.8	%
	4	B		184.4			191.9		2.4	%
	5	Caa and lower		10.8			11.5		0.1	%
	6	In or near default		0.3			0.4		-
Total fixed maturities			$	7,752.4		$	7,890.5		100.0	%
DURATION OF FIXED MATURITIES
			Amortized			Fair		% of Total
			Cost			Value		Fair Value
		0-2 Years	$	1,323.6	$	$	1,352.4		17.1	%
		2-4 Years		2,298.6			2,366.3		30.0	%
		4-6 Years		1,936.8			1,971.5		25.0	%
		6-8 Years		1,836.4			1,839.4		23.3	%
		8-10 Years		270.8			273.2		3.5	%
		10+ Years		86.2			87.7		1.1	%
		Total fixed maturities	$	7,752.4		$	7,890.5		100.0	%
		Weighted Average Duration		4.4

19

THE HANOVER INSURANCE GROUP
TOP 10 CORPORATE AND MUNICIPAL FIXED MATURITY HOLDINGS
September 30,  2017
(In millions, except percentage data)
Issuer	Amortized Cost		Fair Value		As a Percent of  Invested Assets		S&P Ratings
Bank of America	$	30.3	$	31.5		0.34%	BBB+
Wells Fargo		28.4		28.6		0.31%	A
US Bancorp		27.6		28.1		0.30%	A
AT&T		27.0		27.0		0.29%	BBB+
Goldman Sachs		26.5		28.1		0.30%	BBB+
Key Bank		26.3		26.6		0.29%	BBB+
Enterprise Holdings		26.1		26.0		0.28%	BBB+
Morgan Stanley		25.9		26.3		0.28%	BBB+
AvalonBay Communities		25.8		25.8		0.28%	A-
Anheuser-Busch InBev		25.1		25.9		0.28%	A-
Top 10 Corporate and Municipal Fixed	$	269.0	$	273.9		2.95%

20

THE HANOVER INSURANCE GROUP
RECONCILIATION OF OPERATING INCOME TO NET INCOME
	Three Months ended September 30														Nine Months ended September 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	$		28.2					$		42.5					$		108.8					$		129.2
Personal Lines			59.7							41.7							117.5							136.2
Chaucer			(73.8	)						48.4							(19.2	)						87.6
Other			(1.0	)						(2.8	)						(6.0	)						(8.1	)
Total			13.1							129.8							201.1							344.9
Interest expense			(12.1	)						(12.5	)						(36.3	)						(42.8	)
Operating income before income taxes			1.0		$	0.02				117.3		$	2.73				164.8		$	3.84				302.1		$	6.97
Income tax benefit (expense) on operating income			3.7			0.09				(38.7	)		(0.90	)			(47.0	)		(1.10	)			(98.0	)		(2.26	)
Operating income after income taxes			4.7			0.11				78.6			1.83				117.8			2.74				204.1			4.71
Non-operating items:
Net realized investment gains			13.4			0.31				4.2			0.10				21.2			0.50				5.0			0.12
Loss from repurchase of debt			-			-				-			-				-			-				(86.1	)		(1.99	)
Other			(5.5	)		(0.13	)			2.5			0.06				(7.1	)		(0.17	)			4.1			0.09
Income tax benefit (expense) on non-operating items			(0.3	)		(0.01	)			3.0			0.07				4.0			0.10				41.2			0.96
Income from continuing operations, net of taxes			12.3			0.28				88.3			2.06				135.9			3.17				168.3			3.89
Discontinued operations, net of taxes			(1.2	)		(0.02	)			0.1			-				(1.2	)		(0.03	)			0.3			-
NET INCOME	$		11.1		$	0.26		$		88.4		$	2.06		$		134.7		$	3.14		$		168.6		$	3.89

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 November 1, 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
September 30	$	99.63	$	87.90	$	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