Hartford Reports Profit Decline as Investment Income Slides

The Hartford Financial Services Group Inc. said profit tumbled in its latest quarter, as the insurer's investment income dropped and personal lines slid.

The Connecticut company offers commercial and personal insurance and financial products, including property and casualty insurance, group benefits and mutual funds.

Like other insurers, Hartford's investment portfolio was hit during the quarter. Insurers earn a substantial chunk of their income by investing customers' premiums until the money is needed to pay claims, and low interest rates have pressured insurers' profitability for many quarters.

In the first quarter, Hartford's net investment income declined 14% to $696 million. The company attributed the decline to lower income from real estate partnerships and losses on hedge funds. Last week, fellow insurer Travelers Co. said its investment income fell 8.1% from a year earlier.

In addition to the investment hit, Hartford's earnings were dragged down by sharply lower personal lines that the company said fell short of expectations. Although homeowners improved, personal automobile loss trends continued to be challenging, the company said. Personal lines fell by more than two-thirds to $23 million. Commercial lines fared better, rising 6.4% to $249 million.

In all, Hartford reported a profit of $323 million, or 79 cents a share, down from $467 million, or $1.08 a year earlier. Excluding certain items, earnings fell to 95 cents from $1.04.

Analysts projected $1.01 in adjusted earnings per share.

Shares in the company, up 5.8% over the past 12 months, were inactive in after-hours trading.

Write to Lisa Beilfuss at [e-mail]

(END) Dow Jones Newswires

April 28, 2016 19:15 ET (23:15 GMT)

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