The Hartford Completes Sales of Retirement Plans, Individual Life and New Annuity Units

January 3, 2013

The Hartford said it has completed the sales of three businesses, closing on agreements for the sale of Retirement Plans to Massachusetts Mutual Life Insurance Co. and Individual Life to The Prudential Insurance Co. of America, as well as its individual annuity new business capabilities to Forethought Financial Group Inc.

The company previously announced the completion of the sale of Woodbury Financial to AIG on Dec. 3, 2012.

“Completing these transactions on favorable financial terms with a significant capital benefit represents an important milestone in the execution of The Hartford’s transformation,” said The Hartford’s Chairman, President and CEO Liam E. McGee. “We will be a more focused, disciplined and efficient company with greater financial flexibility while generating profitable growth and superior financial returns for shareholders.”

The tranactions fulfill a strategy McGee announced in March when the company bent to demands from its biggest shareholder, hedge fund manager John Paulson, and said vowed to sell off most of its life insurance-related operations to focus on its property/casualty side.

The Hartford said it does not expect these transactions in aggregate to have a material impact on GAAP net income. However, due to the timing of the transaction closings, the company said it expects a modest realized capital loss in fourth quarter 2012 and a modest gain in first quarter 2013. The company will realize an estimated net statutory capital benefit from these transactions of approximately $2.2 billion, which is comprised of an increase in U.S. life statutory surplus and a reduction in the U.S. life risk-based capital requirements1. This net statutory capital benefit is almost entirely associated with the sales of Retirement Plans and Individual Life, which closed on Jan. 1 and 2, 2013, respectively, and, as a result, will be realized in first quarter 2013 statutory financial results.