Big CT insurers show growing profits – but state sees no job gains

Some of the nation’s biggest insurance companies, based in Connecticut, have seen profits jump in 2021. But so far, those gains have not translated into a hiring boom in their home state. .

Despite the strong financial performance of the handful of Fortune 500 insurance companies headquartered in the state, payrolls in the finance and insurance industry declined slightly last year in Connecticut. Some lawmakers say a broader labor shortage is contributing to the trend, but they still see opportunities to create more insurance jobs in Hartford, “the insurance capital of the world,” and across other parts of the state.

“The insurance industry is a major employer in our state, especially in the Hartford area,” said State Rep. Kerry Wood, D-Rocky Hill, co-chair of the state’s insurance and real estate committee. state legislature, in an interview. “Not only do they provide jobs, but they also provide a vital service to many people in the state through comprehensive health coverage. I would consider them an extremely important part of Connecticut’s economy.

Statewide, about 100,000 people worked in finance and insurance in December, down 600 jobs, or 0.6%, from December 2020, according to data released last week by the Department. state work. During the same period, overall employment in Connecticut increased by 3.3%.

“There is a labor shortage in all sectors of our economy. I am extremely concerned about the loss of well-paying, highly-skilled jobs in our state,” Wood said. “However, in sectors like finance and insurance, technology and innovation will replace some of the jobs in these sectors over time.”

Solid results in 2021

On Thursday, The Hartford reported quarterly and annual results that included earnings of about $2.3 billion in 2021, up 37% from 2020. No. 142 on Fortune’s 2021 list of companies listed in Ranked by revenue, The Hartford Financial Services Group specializes in real estate and casualty insurance, group benefits, and mutual funds.

“We begin 2022 competitively positioned with strong momentum and a winning formula to consistently deliver superior risk-adjusted returns,” Hartford CEO and Chairman Christopher Swift said in a statement. “Our businesses complement each other extremely well and together represent a unique portfolio with distinctive advantages.”

Last year, The Hartford rejected several takeover attempts by another major insurer, Chubb. The possibility of The Hartford being subsumed into another company has raised concerns among a number of state lawmakers that a merger could result in significant layoffs.

While that scenario didn’t materialize, the company cut positions as part of its Hartford Next program, which focuses on cost reduction.

The Hartford employs a total of about 18,500 people, including about 6,100 in Connecticut, compared to a workforce of about 13,000 in the state before the Great Recession. This decline was largely due to the sale of businesses.

In response to a Hearst Connecticut Media survey of the number of layoffs made under the program, The Hartford said in a statement that “based on our current estimates, we expect 2.6% of our total workforce in 2019 will be affected by involuntary separations as a result of Hartford Next by December 31, 2022. Hartford Next helps position the organization for long-term sustainability and continued profitable growth.

The company did not specify how many “involuntary separations” involved Connecticut-based employees. The company also said that “we continue to hire across the business as needed and in line with our strategy.”

Also on Thursday, Bloomfield-based pharmacy executive and health insurer Cigna, the 13th company on the Fortune list, reported annual profits of about $5.4 billion, down about $3 billion from to 2020. The difference in net income reflects a tax gain of approximately $3.2 billion the company recorded in 2020 from the sale of its group disability and life insurance businesses.

“We performed well in 2021 as we supported the growing needs of our customers, customers and patients,” Cigna CEO and President David Cordani said in a statement. “2022 will be a year of growth for our entire franchise as we continue to innovate and advance our work to make healthcare more affordable, predictable and simple.”

WR Berkley — the other Fortune 500 insurer headquartered in the state, ranked No. 372 last year — reported fourth-quarter and full-year results last week. It posted a profit of around $1 billion for 2021, nearly double the net result of 2020.

In a press release, the company described the last quarter as “exceptional”, citing growth of more than 26% in net premiums written and an annualized return on equity of approximately 19%.

Berkley is one of the largest underwriters of commercial insurance lines in the United States

Messages left this week with Cigna and WR Berkley asking for their number of Connecticut-based employees and their hiring plans were not returned. Cigna had about 4,500 employees in the Hartford metro before the pandemic.

Other industry powerhouses headquartered in the state include Hartford-based health insurer Aetna, which was acquired for about $70 billion by CVS Health in 2018. CVS Health is expected to release results. quarterly and annual on Wednesday.

Aetna has more than 5,400 Hartford-based employees and about 50 job openings in Hartford, according to data shared this week by the company.

Looking for more job growth

The finance and real estate sector includes employment in banks, which continued to consolidate.

On the insurance side, instead of relying on companies like The Hartford, Cigna and WR Berkley to hire in large numbers, Wood, the lawmaker, said the state could be better served by trying to recruit more insurers. During this year’s session, she wants to advance legislation similar to a bill last year that was considered, but not passed, that would provide incentives such as “tax amnesty” for corporations. insurance companies to base their operations in Connecticut.

Captive insurance companies are wholly-owned subsidiaries that cover the risks specific to their parent organizations.

“They look forward to making Connecticut their home as we continue to be the insurance capital of the world,” Wood said. “We have a unique specialist workforce – actuaries, forensic lawyers, analysts – that can help the captive insurance industry grow and succeed. I hope we pass this bill in the 2022 session.”

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