I’ll leave the analysis of the full results to others, but the work comp portion of The Hartford’s 2011 financial performance caught my eye.
Of the 61% drop in net income from ’10 to ’11, The Hartford attributed a material portion of that to reserve fund strengthening costs, including $161 million in work comp (just for the 4th quarter). For all other P&C lines during the same time period, The Hartford actually released reserves of $52 million. Ouch.
And the commentary from President and CEO Liam McGee? “…we are evaluating our strategy and business portfolio for opportunities to deliver greater value for shareholders.”
Once upon a time, I was a management consultant and provided strategic advisory services and financial advice to Fortune 100 companies (a couple of them direct competitors of The Hartford). I can’t tell you what’s next, but when a CEO follows up on a strategic business unit loss of that magnitude with a comment like “we’re evaluating our strategy and business portfolio”… well, change is coming.
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