HARTFORD EXITS ANNUITIES IN JAPAN AND UK AFTER Q1 CHARGE

US p/c and life group Hartford Financial Services has posted a Q1 net loss of $1.21bn against a year-earlier gain of $145m owing to a $1.5bn charge that the Connecticut-based company recorded after reviewing prospects for future gross profits in its life operations. Hartford revised its estimate, called a DAC unlock, because of the impact of significant equity market declines on the group’s asset and liability balances, including deferred acquisition costs (DAC) and benefits and claim losses and expenses. In response to the developments in its life operations, Hartford said that it plans to cease writing new variable annuity business in Japan and the UK. Hartford’s p/c operations saw net income from ongoing operations sink 64% to $111m, reflecting a doubling of net realised capital losses to $188m and lower investment income from partnerships, alternative investments and lower underwriting income. The combined ratio for ongoing p/c operations, excluding catastrophes, rose to 90% from 87.9%. Ice and wind storms in the eastern US, and other catastrophes, added another 2.6 percentage points to the combined ratio during the 2009 quarter. With the Q1 charge, Hartford said that its 2009 core earnings are now expected to be in a range of 5¢ to 45¢ a share against its previous projection of $5.80 to $6.20 a share.