3 Mysteries About the Would-Be Owner of a Big Annuity Business

A list of the leading U.S. issuers of life and annuity business created in 2005 would have looked pretty much like a similar list compiled a century earlier

Established distribution networks, complicated regulations and sheer size built formidable moats around the big gorillas.

Now, however, the Internet, the Great Recession, low interest rates and regulatory change have rearranged the moats.

MetLife Inc. put its individual life and annuity operations in a separate, stand-alone company, Brighthouse Financial Inc. Some other big players have sold or realigned their annuity operations.

Now, Hartford Financial Services Group Inc. has announced plans to sell Talcott Resolution, the unit that holds its runoff annuity business, for $2.05 billion, to an investor group led by Henry Cornell and Cornell Capital L.L.C., by June 30, 2018.

Talcott Resolution oversees three life insurers that were once major sellers of new individual annuities, and which continue to oversee blocks of annuities with a total of about $149 billion in account value: Hartford Life Inc., Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company.

In regulatory filings, Hartford Financial shows that, officially, the investor group consists of three “Hopmeadow” companies: Hopmeadow Acquisition Inc., Hopmeadow Holdings L.P. and Hopmeadow Holdings Group L.L.C.

Representatives from Cornell Capital and the Hopmeadow companies were not immediately available to comment on the deal announcement, and they did not participate in a conference call Hartford Financial held to discuss the impact of the pending deal on Hartford Financial.

(Related: Investor Group Agrees to Acquire Hartford Annuity Business)

Here are five open questions about the deal.

1. What is Hopmeadow?