Wednesday, February 8, 2012

The Hartford: 2011 Financial Results

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. 
On Twitter @PRIUM1

No comments:

Post a Comment