WRAPUP 1-US life insurers dragged down by investments

* Hartford, Prudential have losses; MetLife net falls

* Tough quarter for investments

* Prudential OK'd for Fed commercial paper program

By Lilla Zuill

NEW YORK, Oct 29 (Reuters) - Three of the largest U.S. life insurers on Wednesday posted weaker third-quarter results, hurt by losses on investments.

Hartford Financial Services Group Inc (HIG.N) and Prudential Financial Inc (PRU.N) posted quarterly losses, while profit at MetLife Inc (MET.N) declined.

Like many financial companies, insurers are being hurt as falling stock prices and the seizure of credit markets cause the value of their investments to decline, raising concern they might need more capital. Many have also faced downward pressure on premiums, and increased claims payouts for the busiest U.S. hurricane season since 2005.

"It's not going to be a pretty couple of quarters for any of these companies, but long term it's not like their business model is broken," said Alan Rambaldini, an analyst at Morningstar Inc.

Hartford posted a $2.63 billion loss, or $8.74 per share, reflecting $2.2 billion of realized capital losses.

On a "core" basis, the loss was $422 million, or $1.40 per share, though that was better than the average analyst forecast for a $1.53 per share loss, according to Reuters Estimates.

Chief Executive Ramani Ayer characterized the period as the "most challenging in Harford's history." The 198-year-old insurer, based in Hartford, Connecticut, cut its 2008 profit forecast by more than half, to a range of $4.30 to $4.50 per share.

MetLife said operating profit fell 43 percent to $639 million, or 88 cents per share. Profit was a penny per share below analyst forecasts, but at the midpoint of the range that MetLife forecasted on Oct. 7.

Results reflected a 65 percent decline in operating profit in the annuities business, which was hurt hurt by weakened equity markets and lower investment income. New York-based MetLife said variable investment income was about $120 million below expectations.

Prudential swung to a $108 million net loss, or 23 cents per share. Operating profit excluding items for financial services operations fell 68 percent to $308 million, or 74 cents per share. Analysts expected profit of 78 cents per share.

Results included charges tied to its securities brokerage joint venture with Wachovia Corp WB.N, and $180 million of net realized investment losses.

The Newark, New Jersey-based insurer withdrew its 2008 earnings forecast, citing "current market volatility," after earlier this month suspending stock buybacks. Prudential in July had projected adjusted operating profit of $7.50 to $7.80 per share.