Litigation

Will April Showers Bring May Flowers? Hartford "Taking Measures to Stabilize Ratings... Preserve Capital"-CEO

By John Darer

Greetings from London.

The Hartford reported "showers" on Thursday, with a $1.2B loss for Q1 2009.

Today's Hartford Courant, citing The Hartford CEO Ramani Ayer, "The financial markets remain difficult and the outlook for the economy is uncertain"In light of these conditions, even as a well capitalized company, we are taking additional measures" to stabilize ratings and preserve capital".

The Courant says that among those steps, The Hartford is "pursuing options" for its Institutional Markets business, a part of the life operations that sells corporate-owned and bank-owned life insurance. That business also sells structured settlements ? a way that settlements in personal injury lawsuits and other claims are paid.

The company announced sweeping changes which include suspending all new sales starting June 1 in Japan, where it has more than 500,000 policies in force. It has also decided to halt sales in the United Kingdom and won't proceed with plans to launch sales in Germany. In addition, The Hartford will make changes in its U.S. variable annuity products where like other variable annuity writers with GRIPS or guaranteed retirement income protection, it has been battered by contract guarantees that purportedly underestimated the worst case scenario.

Why so vague on the Institutional Market side?  The sooner the company resolves what is happening with Institutional markets the better. Hartford Life Insurance Company has historically been one of the major structured annuity writers.

Full post as published by Structured Settlements 4Real on May 01, 2009 (boomark / email).