"The core businesses of The Hartford performed well in the fourth quarter," said Liam E. McGee, The Hartford's Chairman, President and Chief Executive Officer. "This is our third consecutive quarter of improving core earnings results, demonstrating the underlying strength of The Hartford's franchise."
During the fourth quarter, the company's property and casualty operations continued to see strong current accident year underwriting profitability, driven by disciplined risk selection and light catastrophe losses. In addition, the preliminary results reflect favorable net prior year reserve development of approximately $85 million, after-tax, or $0.20 per diluted share, as reserves developed positively across multiple lines.
The company's life results benefited from improving margins in its more equity-sensitive businesses, driven by rising account values and reduced expense levels. The fourth quarter preliminary estimate of core earnings also includes an after-tax DAC unlock benefit of $110 million, or $0.26 per diluted share, driven primarily by strong equity market returns. This is a preliminary estimate and is subject to change.
The company's preliminary estimate of fourth quarter losses on limited partnerships and other alternative investments is approximately $5 million, after-tax, or $0.01 per diluted share. The better than expected performance was due to strong hedge fund and private equity results and smaller losses on real estate-oriented funds.
The Hartford intends to release its fourth quarter and full year 2009 financial results on Monday, February 8, 2010, following the close of the market. The company's conference call to discuss its fourth quarter and full year 2009 financial results will take place on Tuesday, February 9, 2010, at 9 a.m. EST and will be simultaneously webcast at http://ir.thehartford.com.