In a rare public appearance, The Hartford’s outgoing President and Chief Operating Officer Thomas Marra spoke to 50 or so business leaders in Avon recently, reflecting on his 29 years at the company and calling it “the right time” to leave.
Marra, who recently announced that he would retire in July, said that these were “clearly challenging times” for the 199-year-old insurance company and that his departure is a result of a change in the company’s management structure.
“They are going to streamline the reporting of the organization,” Marra said at the April 3 Business Leaders Networking Breakfast at the Avon Old Farms Inn. “Company heads will now report directly to the CEO.”
Marra spoke for about 20 minutes and did not take questions at the end of his speech or talk about The Hartford’s financial condition. He called this a “quiet period,” before first quarter results become public April 30.
When Marra departs the company in July, he will become the fifth high-ranking executive to leave The Hartford in nearly two years as the company struggles with investment losses and an ailing variable-annuity business.
The Hartford, which has cut hundreds of jobs and reported a $2.7 billion net loss for 2008, got a $2.5 billion capital infusion in October from German insurer Allianz, which now owns about 24 percent of the company.
The Hartford has called Marra’s early retirement a “mutually agreed separation.”
Marra kept his speech light, reflecting on Hartford Life’s growth since it moved its operations to Simsbury in 1986.
“When we moved into the Simsbury office, we were the 45th largest life insurer,” Marra said. “Since then, we’ve grown into the fourth largest life insurer in assets.”
He also praised the corporate culture of The Hartford, saying it is a company that employees “can have pride in.”
“I’m a big believer of the atmosphere there,” Marra said.
Marra gave no indication of what he plans to do after he retires.
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Federal Regulator Proposed
U.S. lawmakers have reintroduced legislation that would establish a federal regulator for insurance companies, a move that has drawn support from the insurance industry and fierce opposition from state insurance regulators.
The bill, introduced by Rep. Melissa Bean, D-Ill., and Rep. Ed Royce, R-Calif., would create an optional federal charter, which would allow insurance providers to choose a state or federal regulator.
The insurance industry, which has long lobbied for a federal regulator, largely applauded the plan.
“We have long supported the availability of a market-based federal charter for insurers and believe it is the best model for modernizing our insurance regulatory structure,” Leigh Ann Pusey, president of the American Insurance Association, said in a written statement.
Past attempts to adopt similar legislation, however, have failed largely because of opposition from states and consumer groups, who say such a move would lead to higher rates and would weaken consumer protection.
“This is not a reform bill, it is a deregulation bill — aimed at stripping the states of insurance oversight authority and denying consumers of the time-tested protections that regulatory power provides,” said Roger Sevigny, president of the National Association of Insurance Commissioners.
In January, state lawmakers asked Connecticut Insurance Commissioner Thomas Sullivan, who is opposed to a federal regulator, if state regulators have enough authority to adequately oversee the insurance industry through the current economic crisis.
Sullivan said they do, noting that state regulation has performed quite well in the current economic crisis since no insurance company has become insolvent.
Critics of state-based regulation, which has been in place for decades, have argued that the freefall of American International Group demonstrates the need for federal oversight.
But state insurance regulators say AIG’s freefall was not a failure of state-based regulation because AIG Financial Products, the business segment that brought the company to its knees, was actually federally regulated.
AIG Financial Products, which has offices in Wilton, was responsible for trading credit default swaps, the unregulated insurance contracts that bet against the repayment of a debt.
They have been an important contributing factor to the financial crisis.
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Greg Bordonaro is a Hartford Business Journal staff writer.
