The Hartford 2012 Annual Report Download - page 9

Table of Contents
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Principal Products and Services
Mutual Funds offers mutual funds for retail accounts such as retirement plans and 529 college savings plans and provides investment-management and
administrative services such as product design, implementation and oversight. In 2012, Mutual Funds expanded its relationship with Wellington
Management, which serves as the primary sub-advisor for The Hartford’s 57 retail mutual funds, including equity, fixed-income and asset-allocation funds.
Marketing and Distribution
Mutual Fund sales professionals are segmented into two teams; a retail team and an institutional team. The retail team distributes The Hartford’s open-end
funds and markets 529 college savings plans to national and regional broker-dealer organizations, banks and other financial institutions, independent
financial advisors and registered investment advisors. The institutional team distributes The Hartford’s funds to professional buyers, such as broker-dealers,
consultants, record keepers, and bank trust groups.
Competition
Mutual Funds compete with other mutual fund companies along with investment brokerage companies and differentiate themselves through product solutions,
performance, and service. In this non-proprietary broker sold market, the Company and its competitors compete aggressively for net sales.
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Talcott Resolution's business is comprised of runoff business from the Company's U.S. annuity, international annuity, and institutional and private-
placement life insurance businesses. Talcott Resolution's mission is to pursue opportunities to reduce the size and risk of the annuity book of business while
honoring the Company's obligations to its annuity contractholders. Talcott Resolution manages approximately 1.7 million annuity contracts with account
values of approximately $163 billion as of December 31, 2012.
In 2009, the Company suspended international annuity sales in its Japan and European operations and institutional annuity sales in the United States. In
March 2012, the Company announced its intention to place its U.S. annuity business into runoff and sell its Retirement Plans and Individual Life businesses.
Subsequently, the Company completed the sale of its U.S. individual annuities new business capabilities to Forethought Financial Group and the sale of the
administration and operating assets of its private placement life insurance business to Philadelphia Financial Group, Inc. The Talcott Resolution business
segment also includes our Retirement Plans and Individual Life businesses that were sold in January 2013. For further discussion of these transactions, see
Note 2 - Business Dispositions of the Notes to Consolidated Financial Statements.
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The Hartford establishes and carries as liabilities reserves for its insurance products to estimate for the following:
•a liability for unpaid losses, including those that have been incurred but not yet reported, as well as estimates of all expenses associated with
processing and settling these claims;
•a liability equal to the balance that accrues to the benefit of the life insurance policyholder as of the consolidated financial statement date,
otherwise known as the account value;
•a liability for future policy benefits, representing the present value of future benefits to be paid to or on behalf of policyholders less the present
value of future net premiums;
•fair value reserves for living benefits embedded derivative guarantees; and
•death and living benefit reserves which are computed based on a percentage of revenues less actual claim costs.
Further discussion of The Hartford’s property and casualty insurance product reserves, including asbestos and environmental claims reserves, may be found
in Part II, Item 7, MD&A — Critical Accounting Estimates — Property and Casualty Insurance Product Reserves, Net of Reinsurance. Additional discussion
may be found in the Company’s accounting policies for insurance product reserves within Note 1 of the Notes to Consolidated Financial Statements.
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