8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of Earliest Event Reported): October 6, 2008

The Hartford Financial Services Group, Inc.

(Exact name of registrant as specified in its charter)

Delaware	001-13958	13-3317783
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
One Hartford Plaza, Hartford, Connecticut		06155
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: 860-547-5000

Not Applicable
Former name or former address, if changed since last report

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

	Item 1.01 Entry into a Material Definitive Agreement.
	Item 2.02 Results of Operations and Financial Condition.
	Item 3.02 Unregistered Sales of Equity Securities.
	Item 9.01 Financial Statements and Exhibits.
SIGNATURES
Exhibit Index
EX-99.1: PRESS RELEASE

Item 1.01 Entry into a Material Definitive Agreement.

          On October 6, 2008, The Hartford Financial Services Group, Inc. (the “Company”) entered into a Transaction Agreement, dated as of October 6, 2008 (the “Transaction Agreement”), with Allianz SE (“Allianz”) pursuant to which, among other things, the Company agreed to issue and sell in a private placement to Allianz for aggregate cash consideration of $2.5 billion: (i) $1.75 billion of the Company’s 10% Fixed-to-Floating Rate Junior Subordinated Debentures due 2068 (the “Debentures”); (ii) 24,193,548 preferred shares convertible into the Company’s common stock at an issue price of $31.00 per share (the “Common Stock Investment”); and (iii) warrants (the “Warrants”) that are structured to entitle Allianz, upon receipt of necessary regulatory and other approvals, to purchase 69,115,324 shares of Common Stock at an initial exercise price of $25.32 per share.

          Completion of the transaction (the “Closing”) is subject to execution and delivery of an Investment Agreement and Registration Rights Agreement and other customary closing conditions. The closing conditions do not include an “absence of a material adverse change” condition between signing and Closing.

Debentures

          The Debentures will be issued pursuant to a Junior Subordinated Indenture, dated as of June 6, 2008, between the Company and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), as supplemented by a Second Supplemental Indenture between the Company and the Trustee to be entered into at the Closing. The Debentures will rank pari passu with the Company’s 8.125% Fixed-to-Floating Rate Junior Subordinated Debentures due 2068. The Company will also enter into a replacement capital covenant (the “RCC”) at Closing, whereby the Company will agree for the benefit of certain of its debtholders named therein that it will not repay, redeem, defease or repurchase and will cause its subsidiaries not to purchase, as applicable, all or any portion of the Debentures at any time prior to the fortieth anniversary of the issue date, except to the extent that the principal amount repaid or defeased or the applicable redemption or purchase price does not exceed the applicable percentage (as defined in the RCC) of the proceeds from the sale of certain replacement capital securities as set forth in the RCC. The Debentures will not be subject to any transfer restrictions other than those imposed under applicable securities laws.

Common Stock

          Allianz’s Common Stock Investment will initially be in the form of depositary shares (“Depositary Shares”) representing a new series of non-voting preferred stock (the “Preferred Stock”) that will participate on a pari passu basis with dividends paid on the Common Stock and will be convertible into Common Stock upon receipt of certain regulatory approvals.

Warrants

          In connection with its investment, Allianz will receive Warrants that, after all necessary governmental and regulatory approvals and any required approval from the Company’s shareholders have been obtained, will be exercisable to purchase 69,115,324 shares of Common Stock at an initial exercise price of $25.32 per share. Until such approvals have been obtained, the Warrants will be immediately exercisable for Preferred Stock represented by Depositary Shares. The exercise price is subject to adjustment for, among other things, certain anti-dilution events. In addition, if any such required shareholder approval is not obtained within six months, the exercise price of the Warrants will be permanently reduced by 5%. The Warrants have a term of seven years.

          Until the third anniversary of the Closing Date, the Warrants and any Preferred Stock or Common Stock received upon exercise of the Warrants are subject to restrictions on transfer, except for transfers to its affiliates. In addition to the foregoing limitation on transferability, Allianz may not transfer such Warrants or Common Stock except in (x) an underwritten public offering on customary terms and conditions or (y) one or more private transactions, subject in the case of such private transactions, to a right of first refusal on customary terms in favor of

the Company if any such transaction would result in any person or group (within the meaning of the federal securities laws) acquiring 5% or more of the Company’s Common Stock.

Standstill Provisions

          Under the Transaction Agreement, Allianz has agreed to certain standstill provisions for a ten-year period following the date of the Transaction Agreement, including limitations or prohibitions, among other things, on the acquisition of shares of Common Stock that would result in its beneficially owning more than 25% of the outstanding Common Stock, making or proposing a merger or change of control transaction or soliciting proxies, subject in each case to certain exceptions for a change of control and other matters, as specified in the Transaction Agreement.

Registration Rights

          Pursuant to the Transaction Agreement, the Company has also agreed to grant Allianz certain demand registration rights with respect to the shares of the Company’s Common Stock that it acquires upon conversion of the Preferred Stock and pursuant to exercise of the Warrants. Allianz will have the right to demand registration of such shares of Common Stock for resale at any time after the Closing Date on the basis of one occasion every six months, subject to customary blackout and suspension periods. Allianz will also have customary piggyback registration rights.

          A copy of the Company’s press release announcing the transaction is attached as Exhibit 99.1, and the portion thereof under the heading “Terms of Investment” and the legend appearing as the last paragraph of the release are incorporated by reference herein.

Item 2.02 Results of Operations and Financial Condition.

          On October 6, 2008, the Company issued a press release that included certain preliminary estimates of its financial results for the three months ended September 30, 2008. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.

Item 3.02 Unregistered Sales of Equity Securities.

          As described under Item 1.01 above, pursuant to the Transaction Agreement, the Company has agreed to sell to Allianz for cash in a private placement pursuant to Section 4(2) of the Securities Act of 1933, as amended, 24,193,548 shares of Common Stock (which investment will initially take the form of Depositary Shares representing Preferred Stock convertible into Common Stock) at an issue price of $31.00 per share and Warrants that, upon receipt of necessary regulatory and other approvals, will be exercisable to purchase 69,115,324 shares of Common Stock at an initial price of $25.32 per share (or in certain circumstances additional shares of Preferred Stock as described in Item 1.01 above).

Item 9.01 Financial Statements and Exhibits.

          (d) Exhibits

Exhibit No.	Description
99.1	Press Release of The Hartford Financial Services Group, Inc. dated October 6, 2008

3

SIGNATURES

          Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	The Hartford Financial Services Group, Inc.
October 6, 2008	By:	/s/ Ricardo A. Anzaldua
		Name:	Ricardo A. Anzaldua
		Title:	Senior Vice President and Corporate Secretary

Exhibit Index

Exhibit No.	Description
99.1	Press Release of The Hartford Financial Services Group, Inc. dated October 6, 2008

EX-99.1

Exhibit 99.1

NEWS RELEASE

Media Contact(s): Shannon Lapierre 860-547-5624 Shannon.lapierre@thehartford.com	Investor Contact(s): Kim Johnson 860-547-6781 kimberly.johnson@thehartford.com
	JR Reilly 860-547-9140 JR.Reilly@thehartford.com

The Hartford Announces $2.5 Billion Investment By Allianz SE

Also announces:

• Preliminary third-quarter results;

• Reduced dividend; and

• New chief investment officer

Hartford, Conn., — October 6, 2008 — The Hartford Financial Services Group, Inc. (NYSE: HIG) today announced a binding agreement with Allianz SE, which provides for a $2.5 billion capital investment.

“We are pleased that Allianz, one of the world’s leading insurers and financial services providers, will make such a significant investment in The Hartford,” said The Hartford’s chairman and chief executive officer Ramani Ayer. “We are taking decisive action to ensure that The Hartford remains well capitalized for long-term success. This investment strengthens our ability to weather volatile markets and continue to invest and vigorously compete in our businesses. We are dedicated to honoring our commitments to customers.”

“We believe in the fundamental strength of the U.S. economy and its insurance industry and respect The Hartford as a great insurance brand,” said Michael Diekmann, chairman of the Board of Management and chief executive officer of Allianz SE. “We anticipate a favourable return on our investment.”

Terms of the Investment

Allianz will purchase, at $31 per share, $750 million of preferred shares convertible to common stock after receipt of applicable approvals, and $1.75 billion of 10% junior subordinated debentures. The debentures are callable by The Hartford at par beginning ten years after issuance.

2 — The Hartford Announces Investment

Allianz SE will also receive warrants which entitle it to purchase $1.75 billion of common stock at an exercise price of $25.32 per share, subject to shareholder approvals. The warrants expire in seven years.

Preliminary Third Quarter Results

The company expects a net loss for the third quarter in the range of $8.50 to $8.80 per share, including net realized capital losses in the range of $7.05 to $7.25 per share, or approximately $2.1 billion to $2.2 billion. The vast majority of the realized capital losses are impairments on The Hartford’s investment portfolio. About 75 percent of the impairments are related to investments in the financial services sector, which were negatively affected by recent market turmoil.

The company estimates book value per share to be in the range of $55.55 to $55.85, excluding AOCI*, and $41 to $44, including AOCI, at September 30, 2008. Book value per share, including AOCI, reflects estimated net unrealized losses in the range of $3.4 billion to $4.2 billion, after tax and after deferred acquisition costs (DAC).

For the third quarter, the company expects to report core earnings per share* in the range of $1.50 to $1.60 before the effect of a DAC unlock. Core earnings includes estimated current accident year catastrophe effects of $230 million, or $0.77 per share, after tax. The company estimates a charge of approximately $3.05 per share, or $915 million, related to the revision of its estimates of future gross profits, commonly referred to as a “DAC unlock.” The DAC unlock estimate is based on the S&P 500 market level of 1,165 as of September 30, 2008.

Life operations deposits and flows are expected to be within or above previously provided third quarter 2008 guidance ranges, except for U.S. variable annuity deposits, which are slightly below guidance. In property and casualty, the ongoing operations combined ratio, excluding catastrophes and prior year development, is expected to be 91.8 percent for the third quarter of 2008.

* Denotes financial measures not calculated based on generally accepted accounting principles (“non-GAAP”). More information is provided in the discussion of non-GAAP financial measures section below.

Capital

“With this investment by Allianz SE, we project that we will finish the year with a capital margin of about $3.5 billion in excess of our modeled rating agency requirements to maintain AA level ratings,” said Ayer. This estimate assumes year-end market levels are the same as the end of the third quarter, rating agency models remain unchanged and the company’s operations perform as planned for the remainder of the year.

3 — The Hartford Announces Investment

The above figures are preliminary estimates based on information available at this time. The company’s actual financial results for the quarter could differ materially. Please see the notes at the end of this release for further information about the risks and uncertainties that could cause actual results to differ.

Dividend

In conjunction with Allianz’s financial investment and the increase in shares outstanding, The Hartford has reduced its quarterly dividend to $0.32 per share.

Chief Investment Officer Appointment

Effective immediately, Greg McGreevey, who joined the company in August, will assume the position of executive vice president and chief investment officer for The Hartford and president of Hartford Investment Management Company. He succeeds Dave Znamierowski who is leaving the company. Ayer said, “Greg is a seasoned investment professional with a track record of success. He and his team are immersed in our portfolio, evaluating our investments, and setting a course to navigate in this very volatile marketplace.”

“Dave served The Hartford with dedication for the past 12 years. Given the recent unprecedented turmoil in the financial markets and its effect on the company’s investment portfolio, we agreed that it would be best to bring a fresh perspective to our investment operations,” added Ayer.

Goldman, Sachs & Co. served as financial advisor to The Hartford and placement agent with respect to the capital investment by Allianz SE.

About The Hartford

The Hartford, a Fortune 100 company, is one of the nation’s largest financial services companies, with 2007 revenues of $25.9 billion. The Hartford is a leading provider of investment products, life insurance and group benefits; automobile and homeowners products; and business property and casualty insurance. International operations are located in Japan, the United Kingdom, Canada, Brazil and Ireland. The Hartford’s Internet address is www.thehartford.com.

HIG-F

The Hartford uses the non-GAAP financial measure core earnings as an important measure of the company’s operating performance. Because The Hartford’s calculation of core earnings may differ from similar measures used by other companies, investors should be careful when comparing The Hartford’s non-GAAP and other financial measures to those of other companies. The Hartford believes that the measure core earnings provides investors with a valuable measure of the performance of the company’s ongoing businesses because it reveals trends in the company’s insurance and financial services businesses that may be obscured by the net effect of certain realized capital gains and losses. Some realized capital gains and losses are primarily driven by investment decisions and external economic developments, the nature and timing of which are unrelated to the insurance and underwriting aspects of the company’s business. Accordingly, core earnings excludes the effect of all realized gains and losses (net of tax and the effects of deferred policy acquisition costs) that tend to be highly variable from period to period based on capital market conditions. The Hartford believes, however, that some realized capital gains and losses are integrally related to the company’s insurance operations, so core earnings includes net realized gains and losses such as net periodic settlements on credit derivatives and net periodic settlements on the Japan fixed annuity cross-currency swap. These net realized gains and losses are directly related to an offsetting item included in the income

4 — The Hartford Announces Investment

statement such as net investment income. Core earnings is also used by management to assess the company’s operating performance and is one of the measures considered in determining incentive compensation for the company’s managers. Net income is the most directly comparable GAAP measure. Core earnings should not be considered as a substitute for net income and does not reflect the overall profitability of the company’s business. Therefore, The Hartford believes that it is useful for investors to evaluate both net income and core earnings when reviewing the company’s performance. No reconciliation of the estimated third quarter core earnings per share to projected net income is provided because such a reconciliation is not available without unreasonable efforts.

Book value per share excluding accumulated other comprehensive income (“AOCI”) is calculated based upon a non-GAAP financial measure. It is calculated by dividing (a) stockholders’ equity excluding AOCI, net of tax, by (b) common shares outstanding. The Hartford provides book value per share excluding AOCI to enable investors to analyze the amount of the company’s net worth that is primarily attributable to the company’s business operations. The Hartford believes book value per share excluding AOCI is useful to investors because it eliminates the effect of items that can fluctuate significantly from period to period, primarily based on changes in interest rates. Book value per share is the most directly comparable GAAP measure. No reconciliation of the estimated third quarter book value per share, excluding AOCI, to book value per share is provided because such a reconciliation is not available without unreasonable efforts.

Some of the statements in this release should be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These include statements about The Hartford’s future results of operations. The Hartford cautions investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Investors should consider the important risks and uncertainties that may cause actual results to differ.

These important risks and uncertainties include, without limitation, the impact of the current unprecedented volatility in the financial markets on our results and financial condition, particularly if such conditions persist, the impact on the financial markets, and our industry, of current legislative and other initiatives taken or which may be taken in response to the current financial crisis, the impact on our liquidity and our portfolio valuation of potential changes in rating agency requirements and models, variations in our results resulting from the finalization of our financial statements for the third quarter of 2008; the difficulty in predicting the company’s potential exposure for asbestos and environmental claims; the possible occurrence of terrorist attacks; the response of reinsurance companies under reinsurance contracts and the availability, pricing and adequacy of reinsurance to protect the company against losses; changes in financial and capital markets, including changes in interest rates, credit spreads, equity prices and foreign exchange rates; the inability to effectively mitigate the impact of equity market volatility on the company’s financial position and results of operations arising from obligations under annuity product guarantees; the possibility of unfavorable loss development; the incidence and severity of catastrophes, both natural and man-made; stronger than anticipated competitive activity; unfavorable judicial or legislative developments; the potential effect of domestic and foreign regulatory developments, including those which could increase the company’s business costs and required capital levels; the possibility of general economic and business conditions that are less favorable than anticipated; the company’s ability to distribute its products through distribution channels, both current and future; the uncertain effects of emerging claim and coverage issues; a downgrade in the company’s financial strength or credit ratings; the ability of the company’s subsidiaries to pay dividends to the company; the company’s ability to adequately price its property and casualty policies; the ability to recover the company’s systems and information in the event of a disaster or other unanticipated event; potential for difficulties arising from outsourcing relationships; potential changes in Federal or State tax laws, including changes impacting the availability of the separate account dividends received deduction; losses due to defaults by others; the company’s ability to protect its intellectual property and defend against claims of infringement; and other risks and uncertainties discussed in The Hartford’s Quarterly Reports on Form 10-Q, the 2007 Annual Report on Form 10-K and other filings The Hartford makes with the Securities and Exchange Commission. The Hartford assumes no obligation to update this release, which speaks as of the date issued.

The securities referred to above have not been and will not be registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements.