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January 30, 2009 at 07:00 PM
U.S. life and health insurers are starting to report just how hard the recession affected their finances in the fourth quarter of 2008.
Here is a look at the latest earnings reports:
Ameriprise Financial Inc., Minneapolis
4 Q 2008 Results
NET INCOME: $369 million loss
NET REALIZED INVESTMENT CHANGE: $420 million loss
PREMIUMS: $282 million
REVENUE: $1.4 billion
4 Q 2007 Results
NET INCOME: $255 million
NET REALIZED INVESTMENT CHANGE: $18 million gain
PREMIUMS: $271 million
REVENUE: $2.3 billion
- Ameriprise “recorded $63 million in expenses for variable annuity death and income benefits, as the decline in equity markets lowered underlying client account values below the guarantee level,” the company says. “The company also had $25 million in pretax expenses related to hedged variable annuity living benefits….
- “Clients’ decreased risk tolerances and preference to hold cash reduced variable annuity sales and drove net inflows in fixed annuities,” Ameriprise reports.
- Ameriprise says its variable annuity hedging program was 95% effective in 2008.
- Total financial advisors increased 6%, to 12,486, due in part to acquisitions.
- Life insurance in-force grew 3%, to $192 billion.
Allstate Corp., Northbrook, Ill.
4 Q 2008 Results
NET INCOME: $1.1 billion loss
REVENUE: $6.6 billion
ALLSTATE FINANCIAL NET INCOME: $1 billion loss
NET REALIZED INVESTMENT CHANGE: $125 million loss
ALLSTATE FINANCIAL PREMIUMS AND DEPOSITS: $1.8 billion
4 Q 2007 Results
NET INCOME: $760 million
REVENUE: $9 billion
ALLSTATE FINANCIAL NET INCOME: $31 million
NET REALIZED INVESTMENT CHANGE: $736 million loss
ALLSTATE FINANCIAL PREMIUMS AND DEPOSITS: $1.6 billion
- “Liquidity was substantially increased to ensure cash was available to meet customers’ needs,” Allstate says.
- Allstate Financial reduced fixed annuity sales in the second half because of the difficulty of earning attractive returns.
- Life insurance mortality was favorable.
Reinsurance Group of America Inc., Chesterfield, Mo.
4 Q 2008 Results
NET INCOME: $9.4 million
NET REALIZED INVESTMENT CHANGE: $244 million loss
REVENUE: $1.4 billion
