The Hartford's core earnings decreased 15% year on year in the first quarter (Q1) of 2016, principally due to decreased investment income from limited partnerships (LPs) and other alternative investments, and lower underwriting results in personal lines.
Investment income from LPs declined to $8m (before tax) in Q1 2016, a drop of 92% from Q1 2015, and of 33% from Q4 2015, largely due to lower income from real estate partnerships and losses on hedge funds.
Net income from the firm's $73.9bn investment portfolio totalled $696m, a 14% decrease from Q1 2015, and broadly the same as Q4 2015.
"The Hartford's commercial lines and group benefits businesses delivered strong underwriting results in the first quarter," said chairman and CEO Christopher Swift. "However, core earnings declined 15% due to a decrease in total net investment income and personal lines results that were below expectations. Although homeowners improved, personal automobile loss trends continued to be challenging."
The Hartford is a property and casualty insurer headquartered in Hartford, Connecticut, that also manages group benefits and mutual funds. It generated revenues of $18.4bn in 2015.