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February 13, 2009 at 07:00 PM
Connecticut has given Hartford Financial Services Group Inc. permission to use 2 variations from the usual statutory filing regulatory requirements, the company says.
Hartford Financial, Hartford, disclosed the variations in a Form 10-K report filed Wednesday with the U.S. Securities and Exchange Commission.
Hartford says it was given approval regarding the use of 2 permitted practices in its 2008 statutory financial statements.
One was for statutory accounting for deferred income taxes, and the second was for statutory reserving requirements for variable annuities with guaranteed living benefit riders.
The deferred income taxes can be realized over 3 years instead of 1 year, and the asset recognition is increased to 15%, from 10%, Hartford says.
The VA reserving variation will permit Hartford to perform a stand-alone asset adequacy analysis that will reflect the whole VA contract, Hartford says. The analysis usually reflects only the benefits, expenses and charges associated with the riders for variable annuities with guaranteed living benefits riders.
The permitted practices increased statutory surplus for the life operations by $987 million as of Dec. 31, 2008, Hartford says.
Connecticut was the sole state to vote for a package of capital and surplus rule change proposals developed by the American Council of Life Insurers, Washington, during a recent meeting of the executive committee of the National Association of Insurance Commissioners, Kansas City, Mo. Sixteen insurance commissioners opposed the package.
Since then, several states have issued bulletins permitting some or all of the changes requested by the ACLI.
Consumer advocates are questioning why there is a discrepancy in the way commissioners voted and the bulletins that they are issuing.
Both Robert Hunter, an insurance analyst with the Consumer Federation of America, Washington, and Birny Birnbaum, executive director of the Center for Economic Justice, Austin, Texas, have asked why insurers are getting immediate relief when consumers are not being given immediate relief on issues such as credit scoring.
