The Hartford 2009 Annual Report Download - page 6

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Life Principal Products
Retail provides variable and fixed individual annuities with living and death benefit guarantees, mutual funds and 529 plans in the
United States. In October 2009, the Company launched a new variable annuity product designed to meet customer needs for growth and
income within the risk tolerances of The Hartford which is replacing its guaranteed minimum withdrawal benefit product.
Individual Life provides variable universal life, universal life, interest sensitive whole life and term life insurance products to affluent,
emerging affluent and business life insurance clients.
Group Benefits provides group life, accident and disability coverage, group retiree health and voluntary benefits to individual members
of employer groups, associations, affinity groups and financial institutions. Group Benefits offers disability underwriting,
administration, claims processing services and reinsurance to other insurers and self-funded employer plans. Policies sold in this
segment are generally term insurance allowing Group Benefits to adjust the rates or terms of its policies in order to minimize the adverse
effect of market trends, declining interest rates, and other factors. Policies are typically sold with one-, two- or three-year rate
guarantees depending upon the product.
Retirement Plans provides retirement products and services, including asset management and plan administration, to small and medium-
size corporations pursuant to Section 401(k) of the Internal Revenue Code of 1986, as amended (“401(k)”). Retirement also provides
retirement products and services, including asset management and plan administration, to municipalities and not-for-profit organizations
pursuant to Section 457 and 403(b) of the Internal Revenue Code of 1986, as amended (“457 and 403(b)”). In 2008, Retirement
completed three acquisitions. Return on assets was lower for Retirement Plans overall in 2009 reflecting in part, a full year of the new
business mix represented by the acquisitions, which includes larger, more institutionally priced plans, predominantly executed on a
mutual fund platform, and the cost of maintaining multiple technology platforms during the integration period.
International, with operations in Japan, Brazil, Ireland, Canada, and the United Kingdom, provides investments, retirement savings and
other insurance and savings products to individuals and groups outside the United States. During the second quarter of 2009, the
Company suspended all new sales in the Japan and European operations. International is currently completing its restructuring of its
operations to maximize profitability and capital efficiency while continuing to focus on risk management and maintaining appropriate
service levels for in-force policies. In the fourth quarter of 2009, International has entered into an agreement to divest its Brazil joint
venture.
Institutional, prior to the fourth quarter of 2009, provided variable private placement life insurance (“PPLI”), structured settlements,
institutional annuities, longevity assurance, income annuities, institutional mutual funds and stable value investment products. In the
fourth quarter of 2009, the Company completed a strategic review of the Institutional business and has decided to exit several businesses
that have been determined to be outside of the Company’ s core business model. Institutional PPLI, mutual funds, income annuities and
certain institutional annuities will continue to be managed for growth. The private placement life insurance industry (including the
corporate-owned and bank-owned life insurance markets) has experienced a slowdown in sales due to, among other things, limited
availability of stable value wrap providers. We believe that the Company's current PPLI assets will experience high persistency, but our
ability to grow this business in the future will be affected by near term market and industry challenges. Structured settlements,
guaranteed investment products, and most institutional annuities will not be actively marketed, however, certain guaranteed investment
products, such as funding agreements, may be offered on a selective basis.
Life Distribution
Retail’ s distribution network includes national and regional broker-dealer organizations, banks and other financial institutions and
independent financial advisors. Life periodically negotiates provisions and terms of its relationships with unaffiliated parties, and there
can be no assurance that such terms will remain acceptable to Life or such third parties. Life’ s primary wholesaler of its individual
annuities is Hartford Life Distributors, LLC, and its affiliate, PLANCO, LLC (collectively “HLD”) which are indirect wholly-owned
subsidiaries of Hartford Life. HLD provides sales support to registered representatives, financial planners and broker-dealers at
brokerage firms and banks across the United States. As part of the Company’ s assessment of its opportunities in the variable annuity
marketplace it significantly scaled back its HLD operations in 2009.
Individual Life’ s distribution network includes national and regional broker-dealer organizations, banks, independent agents,
independent life and property-casualty agents, and Woodbury Financial Services, an indirect, wholly-owned subsidiary retail broker-
dealer. To wholesale Life’ s products, Life has a group of highly qualified life insurance professionals with specialized training in
sophisticated life insurance sales.
Group Benefits distribution network includes an experienced group of Company employees, managed through a regional sales office
system, to distribute its group insurance products and services through a variety of distribution outlets, including brokers, consultants,
third-party administrators and trade associations.
Retirement Plans distribution network includes Company employees with extensive experience selling its products and services through
national and regional broker-dealer firms, banks and other financial institutions.
International’ s distribution network, prior to the second quarter of 2009, included broker-dealer organizations, banks and other financial
institutions and independent financial advisors. International suspended sales in the second quarter of 2009 in Japan and the U.K.