The Hartford Announces Settlement with Attorneys General of New York, Connecticut and Illinois.

Concludes market timing and broker compensation matters; company introduces supplemental commission program

HARTFORD, Conn. -- The Hartford Financial Services Group, Inc. (NYSE: HIG) today announced a settlement regarding the New York Attorney General's investigation of market timing within the company's variable annuity products. The company has also settled with the New York, Connecticut and Illinois Attorneys General, resolving matters relating to their investigations of the compensation arrangements between The Hartford and its property-casualty agents and brokers. The State of New York Insurance Department joined in the settlement. The company also announced that other previously disclosed matters that were under investigation by these attorneys general have been concluded.

In addition, The Hartford had previously disclosed an investigation by the staff of the Securities and Exchange Commission into matters related to market timing. In light of the settlement announced today, the Commission's staff informed The Hartford that it has concluded its investigation without recommending any enforcement action.

In settling both the market timing and broker compensation matters, The Hartford has agreed to pay, in total, $115 million. This amount consists of $89 million in restitution ($84 million for market timing and $5 million for broker compensation) and $26 million in penalties. A substantial portion of the cost of the settlement has already been funded by the previously disclosed reserve of $83 million set aside for regulatory matters. The Hartford did not admit or deny any violation of federal or state law as a result of this settlement.

Commenting on the announcement, The Hartford's Chairman and CEO, Ramani Ayer said, "We are pleased to have these matters behind us. Since these investigations began more than three years ago, we have cooperated fully with the attorneys general and other regulators. We have worked assiduously to strengthen and improve our business practices and will continue to do so. We emerge from this period with an unwavering resolve to uphold our longstanding commitment to providing our customers with outstanding products and exemplary service."

RESOLUTION OF MARKET TIMING ISSUES

Of the total settlement, $84 million will be paid into a fund to compensate certain variable annuity contract holders of The Hartford for harm the New York Attorney General found to have resulted from the market timing activities of variable annuity contract holders from 1998 through 2003. The Hartford will retain an independent distribution consultant to develop a distribution plan for this fund that will be subject to the New York Attorney General's approval.

Since the 1990's, The Hartford has introduced a wide range of measures to curtail market timing in its individual variable annuity products. These measures include establishment and enforcement of limitations on trading frequency, implementation of programs designed to monitor and detect excessive trading, and institution of fair-valuation procedures to eliminate international arbitrage opportunities. As a result, The Hartford has in place robust measures designed to address market timing in its funds while continuing to provide investors in these products the ability to manage their investments wisely.

RESOLUTION OF AGENT & BROKER COMPENSATION ISSUES

Of the total settlement amount, $5 million will be paid into a fund to compensate certain commercial property-casualty policyholders related to a limited number of isolated instances of improper quoting between 2001 and 2004.

The attorneys general found that in these instances, certain employees of The Hartford engaged in improper underwriting by providing quotes for commercial insurance that were not based on an adequate assessment of the risk. These activities were not in keeping with The Hartford's standards. Over the last several years, the company has voluntarily strengthened its internal controls, guidelines and training in this area.

NEW SUPPLEMENTAL COMMISSION PROGRAM

The Hartford also agreed that it will forego paying contingent compensation in any line of its property-casualty business in which more than 65% of the U.S. market does not pay contingent compensation.

The Hartford has decided to implement a new program for 2008 to compensate property-casualty agents and brokers for their performance in these lines of insurance and in its other standard commercial lines of insurance. Under this new supplemental commission program, The Hartford will pay a fixed commission, set prior to the sale of a particular insurance policy, that is based among other things on the agent or broker's past performance.

"We value our strong partnerships with independent agents and brokers," said Ramani Ayer. "Our new property-casualty supplemental commission program reflects their feedback for a more predictable compensation package."

On its Website, The Hartford makes available for customers enhanced information about its compensation practices and the nature and range of property-casualty agent and broker compensation. This information will be updated to include a description of the new supplemental commission program.

The Hartford, a Fortune 100 company, is one of the nation's largest diversified financial services companies, with 2006 revenues of $26.5 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, Brazil and the United Kingdom. The Hartford's Internet address is www.thehartford.com.

HIG-C

Some of the statements in this release may be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These include statements about our future results of operations. We caution 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, those discussed in our Quarterly Reports on Form 10-Q, our 2006 Annual Report on Form 10-K and the other filings we make with the Securities and Exchange Commission. We assume no obligation to update this release, which speaks as of the date issued.