Friday, May 15, 2009
The Treasury Department has agreed to extend billions in bailout funds to six major life insurers.
The deal follows a months-long quest by some in the sector for government help in shoring up capital positions in the wake of major investment losses.
The Hartford Financial Services Group Inc. was the first to disclose that it had been notified by the Treasury Department that it was eligible for $3.4 billion from the Troubled Asset Relief Program, or TARP. Lincoln National, Allstate, Ameriprise Financial, Principal Financial Group and Prudential Financial are the other five.
The Wall Street Journal reports the total capital injection will be less than $22 billion.
Life insurers had worried that their balance sheets had became clogged by illiquid assets and escalating liabilities to policy holders.