Lincoln Financial announced yesterday a fourth quarter net income loss of $514 million compared to a net income of $196 million in 2010, a $710 million swing from black to red.
For the full year, the Radnor PA based insurance and asset management company's net income plunged 64% to $290 million, from $812 million in 2010.
Operating income was up in the fourth quarter 2011 at $303 million compared with $266 million in 2010. Lincoln said the discrepancy between net income and income from operations was the consequence of a $747 million non-cash goodwill impairment charge related to the life insurance and media business.
For the full year, variable annuity deposits were up 6% to $8.7 billion. Retirement Plan Services net flows were at $0.5 billion compared to $0.3 billion in 2010. Life insurance sales were up 10% to $700 million and there was a group protection loss ratio of 72.9% compared to 76.2% in 2010.
In the fourth quarter, individual annuities reported income from operations of $134 million compared to $123 million in 2010 while gross annuity deposits were down 8% to $2.4 billion due to low interest rates rendering fixed annuities less desirable.
Retirement plan services reported income from operations of $35 million, up $2 million from the same period a year ago.
Life insurance sales in fourth quarter increased 11% from the same period last year to $229 million. Sales for the full year increased 10% to $700 million. Lincoln said the results were indicative of a decline of secondary guarantee universal life sales as pricing was altered to downplay single premium policies and shift their focus to other products. Life insurance in force of $580 billion grew 3% and account values of $35 billion increased 5% over the prior year quarter.
