Posted on 06 Feb 2009
Life and property/casualty insurer Hartford Financial Services Group Inc. lost its Aa3 rating at Moody's Investors Service after posting a second straight quarterly loss. The Connecticut-based insurer's financial-strength rating at the main insurance units was cut to A1.
“The risk of further investment losses and diminished earnings is meaningful in view of unsettled markets and deteriorating economic conditions,” Moody’s said in a statement today.
Chief Executive Officer Ramani Ayer is cutting jobs and seeking government aid to replace capital depleted by investment declines. The company yesterday slashed its dividend 84 percent after posting an $806 million fourth-quarter loss and missing its own capital target.
In Hartford’s life-insurance subsidiary, the risk-based capital ratio, a measure of financial strength, ended the year at about 385 percent, compared with the company’s projection in December of 535 percent. That shortfall came after Hartford’s holding company held on to $1 billion from Allianz SE that it originally intended to transfer to the life-insurance unit. Another $450 million was lost to declines of assets including commercial real estate investments.