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May 08, 2009 at 08:00 PM
Some of the insurers that released earnings this week reported net losses for the first quarter, but others reported positive net income.
Prudential Financial Inc., Newark, N.J.
1 Q 2009 Results
NET INCOME: $14 million
NET REALIZED FINANCIAL SERVICES INVESTMENT CHANGE: $145 million
REVENUE: $8.6 billion
1 Q 2008 Results
NET INCOME: $60 million
NET REALIZED FINANCIAL SERVICES INVESTMENT CHANGE: $262 million loss
REVENUE: $7.6 billion
- The individual annuities unit is reporting $17 million in adjusted operating income, down from $115 million.
- Individual annuity results include charges of $215 million to strengthen reserves for guaranteed minimum death and income benefits and a $112 million net increase in amortization of deferred policy acquisition costs.
- “Mark-to-market of embedded derivatives and related hedge positions associated with living benefits, after amortization of deferred policy acquisition and other costs, resulted in a net benefit of $261 million to current quarter adjusted operating income,” Prudential says.
American International Group Inc., New York
1 Q 2009 Results
NET INCOME: $5.1 billion loss
REVENUE: $20 billion
LIFE AND RETIREMENT OPERATING INCOME: $1.9 billion loss
LIFE AND RETIREMENT PREMIUM REVENUE: $8.3 billion
1 Q 2008 Results
NET INCOME: $7.7 billion loss
REVENUE: $14 billion
LIFE AND RETIREMENT OPERATING INCOME: $1.8 billion loss
LIFE AND RETIREMENT PREMIUM REVENUE $9.3 billion
- In the domestic retirement operations, “new business has slowed principally due to several distribution partners and plan sponsors suspending or de-emphasizing sales of AIG products pending clarification of the future ownership of these businesses,” AIG says. “Similarly, the sales outlook in Domestic Life Insurance continues to remain challenging due to the current economic environment, current ratings and the negative press surrounding AIG.”
Lincoln National Corp., Radnor, Pa.
1 Q 2009 Results
NET INCOME: $579 million loss
IMPAIRMENT OF INTANGIBLES: $604 million loss
REVENUE: $2.2 billion
1 Q 2008 Results
NET INCOME: $289 million
IMPAIRMENT OF INTANGIBLES: 0
REVENUE: $2.6 billion
- Deposits increased 3%, to $9.1 billion.
- The company retired $500 million in long-term debt and $100 million in commercial paper.
- The intangibles impairment charge is “related to the company’s annuity business,” Lincoln says. “The write-down recognizes the current equity market level and its impact on sales and account values, as well as higher discount rates used in valuing the annuity line of business. The charge will have no material impact on leverage ratios due to recent reductions in outstanding debt obligations and does not affect insurance company capital ratios.”
- Net flows into variable annuities fell to $430 million, from $1.2 billion. Net flows into fixed and indexed annuities increased to about $600 million, from about $300 million.
Principal Financial Group Inc., Des Moines, Iowa
1 Q 2009 Results
NET INCOME: $123 million
NET REALIZED CAPITAL CHANGE: $63 million loss
NET INVESTMENT INCOME: $828 million
REVENUE: $2.2 billion
1 Q 2008 Results
NET INCOME: 178 million
NET REALIZED CAPITAL CHANGE: $126 million loss
NET INVESTMENT INCOME: $960 million
REVENUE: $2.5 billion
- Life and health operating earnings fell to $72 million, from $79 million.
Phoenix Companies Inc., Hartford
1 Q 2009 Results
NET INCOME: $75 million loss
NET REALIZED INVESTMENT CHANGE: $64 million gain
OTHER-THAN-TEMPORARY IMPAIRMENT LOSSES: $38 million loss
REVENUE: $542 million
1 Q 2008 Results
NET INCOME: $14 million loss
