Insurance Actionable Intelligence Note

I am a private, entrepreneurial institutional investor with a background in financial engineering, insurance, corporate valuation and real estate. I received an email from a reporter on Friday inquiring into the solvency of insurers, which prompted me to release my timely subscription content regarding the Hartford Insurance Group (HIG) to the public.

I grabbed a substantial bearish position in the Hartford Insurance Group in early October, and released a timely actionable intelligence note on October 17th, followed up by a significant amount of research. Kudos and big ups go out to my research team for doing a phenomenal job crystallizing my strategy. HIG has joined, or is close to joining the increasingly growing 200%+ return on cash investment club.

I picked up on the Hartford after investigating other life insurers, specifically Metropolitan (MET), and found HIG to be the worst of the pack. Please click any and all thumbnails to enlarge to printer quality graphics.

Hartford's yields have spiked into junk territory (pretty much where they belong)	Hartford's CDS spreads have blown by a multiple of 4x to 8x
The Hartford Insurance Group is insolvent, as liabilities currently are the equivalent of more than its tangible assets, and their core investment sector (the financial services industry) adds to those losses literally on a daily basis	This is a graphical depiction of Hartford's own reporting of net outflows - A literal "Run on the Bank" (well, actually insurer).
Previously booked future gains are unraveling rapidly

The general public now has access to the research since the Hartford has pretty much run its course for blog subscribers.

Here is a spreadsheet formally for professional subscribers, detailing the exposure of the top 200 Hartford debt holders that I was able to dig up on short notice - more work definitely needs to be done, along with a target on the top 10. Notice that the top 10 have significant exposure.

	HIG Security Holders
	Holder name	Total Amount Held ($)
1	VANGUARD GROUP INC	261,125
2	TEACHERS INS & ANNU	125,000
3	PRUDENTIAL INSURANCE	69,857
4	JACKSON NATIONAL	65,450
5	NEW YORK LIFE INSURRANCE	64,895
6	AIG ANNUITY INS CO	62,500
7	ALLIANZ LIFE INS CO	61,381
8	CAPITAL RESEARCH AN	58,250
9	SUNAMERICA LIFE INS	53,740
10	NEW JERSEY DIVISION	52,000

Hartford Insurance Group spreads and counterparty/debt holders - pro (149 kB 2008-11-01 09:39:04) This is an Excel 2007 binary document, and either the newest version of excel or equivalent excel reader will be needed to acceess it.

The following are an additional smattering of the stuff my subscribers used to benefit from my research and investment positions, now all free:

10/25/08 Insurance Industry Update - Professional w/inventory addendum (7.5 MB 2008-10-27 03:00:37)

Hartford Insurance Group Forensic Analysis - Pro (619.29 kB 2008-11-06 08:44:34)