State Farm Mutual Automobile Insurance Company has stopped selling annuities from the Phoenix Companies Inc. following Phoenix’s recent financial problems.
A spokesman for State Farm, Bloomington, Ill., says a principal reason for the move was recent financial strength downgrades of Phoenix by rating agencies.
Meanwhile, Phoenix, Hartford, announced its recently reported financial results for 2008 overstated its losses. As a result, Phoenix will delay filing its annual report on Form 10-K.
Phoenix now expects to report a net loss of $378.3 million for the fourth quarter, rather than the $424.3 million loss it had reported in financial statements filed last week. Its net loss for the year would be $726 million rather than the $772 million originally reported, the company says.
Phoenix says the restatement was a result of an error in accounting for income taxes.
The company expects to file its amended 10-K statement with the Securities and Exchange Commission within 15 days, which it notes would be within statutory requirements for delayed statements.