November 01, 2008

The company reported a big third-quarter loss late Wednesday and said that it couldn't gauge the amount of extra capital it has because of market volatility. The results left "lingering capital questions," Andrew Kligerman, an analyst at UBS, wrote to clients on Thursday. Hartford got a $2.5 billion investment from German insurance giant Allianz SE But the stock market, measured by the S&P 500 Index has slumped about 10% since then. That's put more pressure on some of Hartford's businesses that rely on equity-market returns and fees from money management. Hartford's third-quarter loss "was dominated by operating and capital volatility in the variable-annuity segment, which has left the company unable to estimate its current capital margin, raising the risk of a further capital raise," Bijan Moazami, an analyst at Friedman, Billings, Ramsey, wrote Thursday. Hartford shares dropped 52% to close at $9.62 on Thursday. Other insurers with big annuity businesses also fell. Prudential Financial Inc. dropped 18% to $28.87 and Lincoln National Corp. lost 14% to $17.71.