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May 20, 2013

Phoenix's insurance unit posts $39M loss

Contributed photo Phoenix Cos. downtown Hartford headquarters.

The insurance flagship of Hartford's The Phoenix Cos. Inc. suffered a $39 million statutory net loss for the quarter ended March 31 but not before upstreaming millions of dollars in dividends to its struggling parent, the insurer says.

Phoenix Life Insurance's net loss for the period ended March 31 was $38.9 million, overcoming a statutory net gain from operations of $26.2 million, according to the insurer's required filing of unaudited financials with New York state financial regulators.

Phoenix Life's parent is grappling to get around its delayed financial reports for the fourth quarter of 2012 and the first quarter of this year. Phoenix Cos. already has notified investors and securities regulators that it doesn't expect filings for those, as well as this year's second and third quarters, until right before yearend.

Meantime, Phoenix Life said it paid a $20 million dividend to the parent holding company.

Phoenix Life also said it and an affiliate initiated a hedge to protect surplus against the impact of rising interest rates. The hedge also positions parent Phoenix Cos. to exploit tax benefits stemming from expiring capital loss carryforwards maintained at the holding company.

The insurer said the hedge deal cut statutory surplus by $55.2 million and boosted holding company assets through an inter-company tax receivable of $48 million. That receivable is due to be settled in the second quarter, enhancing holding company liquidity and capital flexibility, the company said.

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