Hartford Financial Services Group will return $48.2 million to workers' compensation policyholders under a consent agreement with Florida regulators.

Hartford will issue that amount in refunds or credits to Florida businesses for what regulators deemed to be excess profits for the 2004, 2005 and 2006 accident years. Hartford will be required to provide the funds within 60 days and provide regulators with documentation.

"During these tough economic times, Florida businesses will receive a very significant and important return of premium," Insurance Commissioner Kevin McCarty said in a statement. "Companies certainly are entitled to earn reasonable profits; but the excess profit law protects Florida business owners from paying more than what is actuarially justified."

The $48.2 million figure represents Hartford's underwriting profit in excess of the amount allowed under Florida law. Florida regulates workers' compensation rates and a state excess profits law stipulates the maximum amount of profit underwriters can generate over a three-year period, according to Hartford.

"Loss prevention efforts, along with the Hartford's strong workers' compensation underwriting and risk selection in the state, resulted in lower claims costs. We can think of no better testimony to the partnership achieved between our agents, policyholders and the Hartford than is reflected in the return of these funds," Jim Ward, regional vice president of the Hartford's Orlando, Fla. regional office, said in a statement.

As part of the agreement, Hartford must certify that it has attempted to locate all policyholders whose refund checks are returned; and if unable to locate those policyholders, the funds must be processed as unclaimed or abandoned property pursuant to Chapter 717, Florida Statutes. Hartford also must pay the Office of Insurance Regulation $5,000 in administrative costs.

Hartford's return of funds will bring to $98.8 million the total amount of refunded excess workers' comp profits in Florida so far this year, according to the Office of Insurance Regulation. More than $29.7 million in excess workers' comp profits were refunded to Florida businesses in 2008.

McCarty rolled back a 6.4% rate increase for workers' compensation insurance rates, reinstating an 18.6% rate cut. McCarty's final order came after Gov. Charlie Crist signed legislation restoring a cap on attorney fees in workers' compensation cases (BestWire, June 3, 2009).

Members of Hartford Insurance Pool have current Best's Financial Strength Ratings of A (Excellent).

The top five workers' comp insurers in Florida in 2008, according to A.M. Best Co. state/line data, were: Liberty Mutual Insurance Cos., with a 21.7% market share; American International Group Inc., 8.3%; Zenith National Insurance Group, 6.7%; FCCI Insurance Group, 5.7%; and Zurich Financial Services NA Group, 5.6%.