NU Online News Service, Feb. 9, 3:39 p.m.EST

The Hartford Financial Services Group Inc., reversing a loss,reported a fourth-quarter profit on the strength of its investmentportfolio and disciplined underwriting, the company's chiefexecutive said today.

The Hartford, Conn.-based insurer reported fourth-quarter netincome stood at $557 million, or $1.19 a share, an improvement overthe prior year's net loss of $806 million, or negative $2.71 ashare.

For all of 2009, net income showed a loss of $887 million, ornegative $2.93 a share, compared with a net loss of $2.75 billion,or negative $8.99 a share in 2008.

The results were partly due to a 68 percent increase in propertyand casualty business in the quarter, from $297 million to $498million. For the year, net income rose from $189 million to $1.06billion for the segment.

During a conference call with investment analysts, Liam E. McGeesaid, "Our franchise is stable with growing momentum. The Hartfordhas a strong capital foundation. We are decisively facing ourchallenges and our team is focused on delivering superior returnsthrough sustained, profitable growth."

The company results declined with the onset of the recession andthe insurer eventually applied for and secured $3.4 billion fromthe U.S. Treasury's Troubled Asset Relief Program.

Mr. McGee said this was the third consecutive quarter ofimprovement in core earnings reflecting strong execution by itsinvestment team and a rebound in investment income. On the propertyand casualty side, he said the performance reflected solidunderwriting, release of prior year reserves of $128 million and alight catastrophe year.

The company reported p&c operations produced net income of$508 million and an accident year combined ratio, excludingcatastrophes, of 92.6. P&C earnings contributed $1.4 billionincrease in statutory surplus for all of last year.

Small commercial grew 21 percent and middle market businessincreased 7 percent.

The Hartford said written premiums for the company's p&coperations in the quarter were $2.4 billion compared to $2.5billion for the previous year. The company said the decline was dueto the combination of pressures from the economic recession andsoft market conditions.

On the life side, operations showed a profit of $118 millioncompared to net loss of $807 million for the fourth quarter of2008.

As part of its effort to improve the bottom line, over the pastyear the company has reduced its workforce by 10 percent, or 3,000people, he said.

Looking ahead, Mr. McGee said the economy and markets remainuncertain, but a slow, gradual economic recovery is expected. Hesaid underwriting will remain disciplined.

On the growth side, Mr. McGee said its p&c product offeredto AARP members through independent agents will expand from 20states to 41 by the end of this year.

The company's small commercial Spectrum business owners policiesprogram will also be expanded to 13 more states by the spring.