TWO MAJOR U.S. insurers, Hartford Financial Services Group (HIG) and Principal Financial Group (PFG), slashed their dividends last week. Hartford's 39.6% reduction, to 32 cents a share from 53 cents, giving the stock a 4.48% yield, had been expected because of a $2.5 billion investment in the company by Allianz SE, a German financial-services firm. The Big Board-listed stock recently traded at 28 and change. MetLife (MET) is said to have approached Hartford about a merger. The Connecticut company expects to suffer a third-quarter deficit of $8.50 to $8.80 a share, mostly from investment losses.

Principal Financial cut its annual dividend in half, to 45 cents a share, for a 2.10% yield. It's priced on the NYSE at a bit above 21. Des Moines-based Principal expects to post third-quarter operating earnings per diluted share of 92 cents to 97 cents, in line with Wall Street estimates, and net of 30 cents to 40 cents, versus analysts' consensus of zero.

However, Canada's largest insurer, Manulife Financial (MFC), said it would not cut its payout. Manulife, which yields 4%, also said it believes concerns about its capital position are grossly exaggerated.