Hartford Life Insurance Profit Falls
UPDATE 4/29/2012 - Hartford Financial Services Group Inc. announced that they struck a deal to sell new business in its annuity department as part of its plan to radically overhaul the business. This comes along with a previous announcement to sell a large portion of the their life insurance business as well.
Hartford Life Insurance and Hartford Companies announced that their second quarter net income decreases significantly because of weather related catastrophe claims and asbestos liabilities. The net income for the second quarter was $24 million based on their preliminary announcement earlier this week. They had a net income of $76 million in the second quarter of 2010, so this is a big drop and the effects of excess claims is being felt.
This was a rough storm season in the mid-west and many insurance companies took a hit. Hartford had about $477 million in disaster costs from twelve different events in the second quarter. Chairman and Chief Executive Officer Liam McGee said the results were partly due to these severe catastrophes throughout the US. Hartford fell 70 cents which is about 2.7% to $24.90 in extending trading according to the article "Hartford Profit Falls to $24 Million on Natural Disasters, Asbestos Costs" by Andrew Frye on Bloomberg.com.
The same article goes on to discuss the increase in claims related to mesothelioma, a deadly cancer affecting many Americans. Hartford experienced a $73 million after-tax charge related to a discontinued software project and added $290 million to reserves to cover liability costs associated with asbestos. It also recorded a $74 million after-tax charge when selling Federal Trust Corp.
McGee did go on to say Hartford had strong top line growth through the selling of property and casualty coverage to businesses. Their overall investment portfolio had a net unrealized gain of $800 million by June 30th. The net unrealized loss was about $161 million by March 31st when looking at the 1st quarter earnings statement from earlier this year. There is more detailed information in the Bloomberg article and Hartford life insurance quotes and information can be found on their company website.