Hartford Financial Services Group reported a quarterly profit that was above analysts’ expectations. It was helped by higher underwriting margins but was dragged by the slight drop of premium income in its property and casualty business.
Hartford shares dropped 1 percent in after-hours trading. They closed at $27.21 on the New York Stock Exchange Monday.
Hartford’s core earnings in the property and casualty business that accounts for almost 75 percent of its revenue went up 12 percent to $318 million. Income from premiums earned dropped by 1.7 percent to $2.43 billion.
Hartford has faced stiff competition as there are over 2,000 property and casualty insurance companies in the nation that are competing for the same business. At present, it is the 11th biggest property and casualty insurer in the United States. It has a market share of 2.05 percent according to the National Association of Insurance Commissioners, which is a multi-state insurance regulatory body.
Hartford got a loss in the first quarter due to an after-tax charge of $541 million due to an expansion of its annuities hedging program in Japan. The company has made a warning of the charge earlier this month.
Chief Financial Officer Christopher Swift said that during the quarter, the company executed a large portion of its capital management plan and removed the currency and equity market risk of the Japan variable annuity block with its expended hedging program.
Hartford’s net loss was $241 million compared with net income of $96 million a year ago. Earnings were 92 cents per share, which was above estimates made by analysts. Price increases for the company’s property and casualty business averaged 9 percent.