NU Online News Service, Aug. 7, 2003, 5:06 p.m. EDT – Healthier investment results and strong variable annuity sales helped Hartford Financial Services Group Inc., Hartford, double profits at its life insurance operations during the second quarter.
The company as a whole is reporting $507 million in net income for the second quarter on $4.7 billion in revenue, up from $185 million in net income on $3.9 billion in revenue for the second quarter of 2002.
Last year, huge write-downs and write-offs of investments hit Hartford’s second-quarter earnings hard. The company realized $166 million in investment losses.
This year, the company realized $257 million in investment gains during the second quarter.
The Hartford Life unit is reporting $243 million in net income for the latest quarter on $2 billion in revenue, up from $101 million in net income on $1.7 billion in revenue.
Although life unit premium revenue was up, new life insurance sales fell to $37 million, from $44 million, with a decrease in sales of variable life insurance overwhelming a big increase in sales of universal life insurance.
At the annuity operation, sales of variable annuities soared to $4.2 billion, from $2.3 billion, while sales of fixed annuities fell to $102 million, from $432 million.
Hartford is attributing the slump in fixed annuity sales to a “disciplined approach to rate setting.”
Hartford notes that it will be spending about $27 million to lay off 850 employees. In May, the company said most of the layoffs would come from the property-casualty insurance operations.