Document
false0000021175Common Stock, Par value $2.50"CNA" 0000021175 2020-08-03 2020-08-03 0000021175 exch:XNYS 2020-08-03 2020-08-03 0000021175 exch:XCHI 2020-08-03 2020-08-03


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) August 3, 2020

CNA FINANCIAL CORPORATION
(Exact name of registrant as specified in its charter)

Delaware
 
1-5823
 
36-6169860
(State or other jurisdiction
 
(Commission
 
(IRS Employer
of incorporation)
 
File Number)
 
Identification No.)

151 N. Franklin
Chicago, IL 60606
(Address of principal executive offices) (Zip Code)
(312) 822-5000
(Registrant's telephone number, including area code)

NOT APPLICABLE
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
 
Trading Symbol(s)
 
Name of each exchange on which registered
Common Stock, Par value $2.50
 
"CNA"
 
New York Stock Exchange
 
 
 
 
Chicago Stock Exchange
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
   





ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.
On August 3, 2020, the registrant issued a press release and posted on its website (www.cna.com) a financial supplement providing information on its results of operations for the second quarter 2020. The press release is furnished as Exhibit 99.1 and the financial supplement is furnished as Exhibit 99.2 to this Form 8-K.
The information under Item 2.02 and in Exhibits 99.1 and 99.2 in this Current Report is being furnished and shall not be deemed “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information under Item 2.02 and in Exhibits 99.1 and 99.2 in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(d) Exhibits:
See Exhibit Index.






EXHIBIT INDEX

Exhibit No.
 
Description
 
CNA Financial Corporation press release, issued August 3, 2020, providing information on the second quarter 2020 results of operations.
 
 
 
 
CNA Financial Corporation financial supplement, posted on its website August 3, 2020, providing supplemental financial information on the second quarter 2020.
 
 
 
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)





SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
CNA Financial Corporation
 
 
(Registrant)
 
 
 
Date:  August 3, 2020
By
/s/ Albert J. Miralles
 
 
(Signature)
 
 
Albert J. Miralles
Executive Vice President and
Chief Financial Officer





cnalogoq12020a02.gif

FOR IMMEDIATE RELEASE
CONTACT:
MEDIA:
 
ANALYSTS:
Brandon Davis, 312-822-5885
 
Al Miralles, 312-822-5605
CNA FINANCIAL ANNOUNCES SECOND QUARTER 2020 RESULTS
•
Q2 NET INCOME OF $151M, $0.55 PER SHARE
•
Q2 CORE INCOME OF $99M, $0.36 PER SHARE
•
Q2 P&C COMBINED RATIO OF 112.3%, UNDERLYING COMBINED RATIO OF 93.4%
•
Q2 NET CATASTROPHE LOSSES OF $301M, OR 17.5 POINTS OF LOSS RATIO
•
CATASTROPHE LOSSES INCLUDE $182M DUE TO COVID-19, $61M FROM CIVIL UNREST AND $58M FROM SEVERE WEATHER RELATED EVENTS
•
QUARTERLY DIVIDEND OF $0.37 PER SHARE
CHICAGO, August 3, 2020 --- CNA Financial Corporation (NYSE: CNA) today announced second quarter 2020 net income of $151 million, or $0.55 per share, and core income of $99 million, or $0.36 per share. Property & Casualty Operations combined ratio for the second quarter was 112.3%. Underwriting results for the second quarter of 2020 include previously announced net catastrophe losses of $301 million pretax, including $182 million related to COVID-19, $61 million related to civil unrest and $58 million related primarily to severe weather related events. The underlying combined ratio of 93.4% reflects a 0.4 point net benefit related to COVID-19 from lower loss frequency as a result of shelter in place restrictions and an adverse impact from a reduction in estimated audit premiums. These items decreased the loss ratio by 0.9 points and increased the expense ratio by 0.5 points. Net investment income was $534 million pretax for the second quarter of 2020, including $84 million from limited partnership and common stock investments, reflecting the equity market rebound during the quarter.
The U.S. P&C segments, excluding third party captives, generated gross written premium growth of 8% and net written premium growth of 4%. Excluding third party captives, gross written premiums grew 7% and net written premiums grew 3% for P&C overall.
Our Life & Group and Corporate & Other segments produced core income (loss) for the second quarter of 2020 of $14 million and $(11) million, respectively.
CNA Financial declared a quarterly dividend of $0.37 per share, payable September 3, 2020 to stockholders of record on August 17, 2020.
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions, except per share data)
2020
 
2019
 
2020
 
2019
Net income
$
151

 
$
278

 
$
90

 
$
620

Core income (a)
99

 
294

 
207

 
612

 
 
 
 
 
 
 
 
Net income per diluted share
$
0.55

 
$
1.02

 
$
0.33

 
$
2.28

Core income per diluted share
0.36

 
1.08

 
0.76

 
2.25

 
June 30, 2020
 
December 31, 2019
Book value per share
$
42.91

 
$
45.00

Book value per share excluding AOCI
 
42.34

 
 
44.81

(a)
Management utilizes the core income (loss) financial measure to monitor the Company's operations. Please refer herein to the Reconciliation of GAAP Measures to Non-GAAP Measures section of this press release for further discussion of this non-GAAP measure.

1

“Notwithstanding our second quarter results being impacted by considerable catastrophe losses from COVID-19 as well as civil unrest and weather related events, our underlying combined ratio improved year over year. As well, we benefited from accelerating P&C rate momentum and stable new business despite the economic disruption," said Dino E. Robusto, Chairman & Chief Executive Officer of CNA Financial Corporation.
Property & Casualty Operations
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Gross written premiums ex. 3rd party captives
$
2,132

 
 
$
2,000

 
 
$
4,239

 
 
$
3,987

 
GWP ex. 3rd party captives change (% year over year)
7

%
 
 
 
 
6

%
 
 
 
Net written premiums
$
1,930

 
 
$
1,874

 
 
$
3,793

 
 
$
3,680

 
NWP change (% year over year)
3

%
 
 
 
 
3

%
 
 
 
Net investment income
$
324

 
 
$
303

 
 
$
442

 
 
$
663

 
Core income
96

 
 
298

 
 
218

 
 
612

 
 
 
 
 
 
 
 
 
 
 
 
 
Loss ratio excluding catastrophes and development
59.5

%
 
60.8

%
 
59.9

%
 
60.7

%
Effect of catastrophe impacts
17.5

 
 
2.2

 
 
10.9

 
 
2.9

 
Effect of development-related items
1.4

 
 
(1.1
)
 
 
0.4

 
 
(0.9
)
 
Loss ratio
78.4

%
 
61.9

%
 
71.2

%
 
62.7

%
 
 
 
 
 
 
 
 
 
 
 
 
Expense ratio
33.6

%
 
33.4

%
 
33.2

%
 
33.7

%
 
 
 
 
 
 
 
 
 
 
 
 
Combined ratio
112.3

%
 
95.7

%
 
104.8

%
 
96.8

%
Combined ratio excluding catastrophes and development
93.4

%
 
94.6

%
 
93.5

%
 
94.8

%
•
The combined ratio excluding catastrophes and development improved 1.2 points as compared with the prior year quarter. In addition to a 0.4 point benefit related to COVID-19, the underlying combined ratio improved 0.8 points over the same period last year including a half point improvement in the loss ratio and a 0.3 point improvement in the expense ratio.
•
The combined ratio increased 16.6 points as compared with the prior year quarter. Net catastrophe losses were $301 million, or 17.5 points of the loss ratio in the second quarter of 2020 compared with $38 million, or 2.2 points of the loss ratio, for the prior year quarter. Catastrophe losses in the second quarter of 2020 include $182 million related to COVID-19; $103 million for Specialty, $43 million for Commercial and $36 million for International. The losses were substantially driven by healthcare professional liability with additional impacts from workers' compensation, management liability, commercial property, trade credit and surety. Due to the recent timing of the event, emergence pattern of claims and long tail nature of certain exposures the losses are substantially classified as incurred but not reported (IBNR) reserves.
•
Unfavorable net prior period development increased the loss ratio by 1.4 points in the quarter compared with 1.1 points of favorable development decreasing the loss ratio in the prior year quarter. Unfavorable net prior period development in the current quarter includes a previously announced $50 million pretax charge for mass tort exposures, primarily due to New York reviver statute-related claims.
•
The U.S. P&C segments, excluding third party captives, generated gross written premium growth of 8% and net written premium growth of 4%. Excluding third party captives, gross written premiums grew 7% and net written premiums grew 3% for P&C overall.

2

Business Operating Highlights
Specialty
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Gross written premiums ex. 3rd party captives
$
811

 
 
$
755

 
 
$
1,552

 
 
$
1,485

 
GWP ex. 3rd party captives change (% year over year)
7

%
 
 
 
 
5

%
 
 
 
Net written premiums
$
742

 
 
$
713

 
 
$
1,436

 
 
$
1,411

 
NWP change (% year over year)
4

%
 
 
 
 
2

%
 
 
 
Core income
$
90

 
 
$
161

 
 
$
186

 
 
$
330

 
 
 
 
 
 
 
 
 
 
 
 
 
Loss ratio excluding catastrophes and development
59.9

%
 
59.9

%
 
59.7

%
 
60.2

%
Effect of catastrophe impacts
15.0

 
 
0.1

 
 
8.2

 
 
1.0

 
Effect of development-related items
(2.9
)
 
 
(2.6
)
 
 
(2.3
)
 
 
(2.9
)
 
Loss ratio
72.0

%
 
57.4

%
 
65.6

%
 
58.3

%
 
 
 
 
 
 
 
 
 
 
 
 
Expense ratio
32.0

%
 
33.1

%
 
32.1

%
 
33.0

%
 
 
 
 
 
 
 
 
 
 
 
 
Combined ratio
104.2

%
 
90.7

%
 
97.9

%
 
91.5

%
Combined ratio excluding catastrophes and development
92.1

%
 
93.2

%
 
92.0

%
 
93.4

%
•
The combined ratio excluding catastrophes and development improved 1.1 points as compared with the prior year quarter due to a 1.1 point improvement in the expense ratio driven by lower underwriting expenses and higher net earned premiums. The underlying loss ratio was consistent with the prior year quarter.
•
The combined ratio increased 13.5 points as compared with the prior year quarter. Net catastrophe losses were $105 million, or 15.0 points of the loss ratio in the second quarter of 2020, nearly all due to COVID-19, compared with $1 million, or 0.1 points of the loss ratio, for the prior year quarter. Favorable net prior period development improved the loss ratio by 2.9 points in the quarter compared with a 2.6 point improvement in the prior year quarter.
•
Gross written premiums, excluding third party captives, grew 7% and net written premiums grew 4% for the second quarter of 2020 driven by strong rate.

3

Commercial
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Gross written premiums ex. 3rd party captives
$
1,044

 
 
$
958

 
 
$
2,103

 
 
$
1,891

 
GWP ex. 3rd party captives change (% year over year)
9

%
 
 
 
 
11

%
 
 
 
Net written premiums
$
949

 
 
$
912

 
 
$
1,899

 
 
$
1,761

 
NWP change (% year over year)
4

%
 
 
 
 
8

%
 
 
 
Core income
$
20

 
 
$
120

 
 
$
44

 
 
$
259

 
 
 
 
 
 
 
 
 
 
 
 
 
Loss ratio excluding catastrophes and development
59.0

%
 
61.7

%
 
60.1

%
 
61.9

%
Effect of catastrophe impacts
19.0

 
 
4.9

 
 
12.8

 
 
5.1

 
Effect of development-related items
6.0

 
 
(0.1
)
 
 
3.0

 
 
(0.3
)
 
Loss ratio
84.0

%
 
66.5

%
 
75.9

%
 
66.7

%
 
 
 
 
 
 
 
 
 
 
 
 
Expense ratio
33.9

%
 
32.6

%
 
33.6

%
 
33.2

%
 
 
 
 
 
 
 
 
 
 
 
 
Combined ratio
118.5

%
 
99.7

%
 
110.1

%
 
100.5

%
Combined ratio excluding catastrophes and development
93.5

%
 
94.9

%
 
94.3

%
 
95.7

%
•
The combined ratio excluding catastrophes and development improved 1.4 points as compared with the prior year quarter which reflects a 0.7 point net benefit related to COVID-19 from lower loss frequency as a result of shelter in place restrictions and an adverse impact from a reduction in estimated audit premiums. These items decreased the loss ratio by 1.8 points and increased the expense ratio by 1.1 points.
•
Excluding the impacts of COVID-19, the underlying combined ratio improved 0.7 points due to the loss ratio.
•
The combined ratio increased 18.8 points as compared with the prior year quarter. Net catastrophe losses were $151 million, or 19.0 points of the loss ratio in the second quarter of 2020 compared with $37 million, or 4.9 points of the loss ratio, for the prior year quarter. Catastrophe losses in the second quarter of 2020 include $43 million related to COVID-19, $61 million related to civil unrest and $47 million related primarily to severe weather related events. Unfavorable net prior period development increased the loss ratio by 6.0 points in the quarter compared with 0.1 points of favorable development decreasing the loss ratio in the prior year quarter.
•
Gross written premiums, excluding third party captives, grew 9% and net written premiums grew 4% for the second quarter of 2020 due to strong rate and higher new business.


4

International
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Gross written premiums
$
277

 
 
$
287

 
 
$
584

 
 
$
611

 
GWP change (% year over year)
(3
)
%
 
 
 
 
(4
)
%
 
 
 
Net written premiums
$
239

 
 
$
249

 
 
$
458

 
 
$
508

 
NWP change (% year over year)
(4
)
%
 
 
 
 
(10
)
%
 
 
 
Core (loss) income
$
(14
)
 
 
$
17

 
 
$
(12
)
 
 
$
23

 
 
 
 
 
 
 
 
 
 
 
 
 
Loss ratio excluding catastrophes and development
59.9

%
 
60.1

%
 
60.1

%
 
58.5

%
Effect of catastrophe impacts
19.9

 
 
0.2

 
 
11.9

 
 
1.3

 
Effect of development-related items
(1.2
)
 
 
(0.1
)
 
 
(0.7
)
 
 
2.7

 
Loss ratio
78.6

%
 
60.2

%
 
71.3

%
 
62.5

%
 
 
 
 
 
 
 
 
 
 
 
 
Expense ratio
36.7

%
 
37.3

%
 
36.1

%
 
37.2

%
 
 
 
 
 
 
 
 
 
 
 
 
Combined ratio
115.3

%
 
97.5

%
 
107.4

%
 
99.7

%
Combined ratio excluding catastrophes and development
96.6

%
 
97.4

%
 
96.2

%
 
95.7

%
•
The combined ratio excluding catastrophes and development improved 0.8 points as compared with the prior year quarter due to a 0.2 point improvement in the underlying loss ratio primarily driven by lower loss frequency from the impact of COVID-19 as well as 0.6 points of improvement in the expense ratio driven by lower acquisition and underwriting expenses.
•
The combined ratio increased 17.8 points for the second quarter of 2020 as compared with the prior year quarter. Net catastrophe losses were $45 million, or 19.9 points of the loss ratio in the second quarter of 2020, predominantly due to COVID-19, compared with less than $1 million, or 0.2 points of the loss ratio, for the prior year quarter. Favorable net prior year development improved the loss ratio by 1.2 points in the quarter compared with a 0.1 point improvement in the prior year quarter.
•
Excluding currency fluctuations, gross written premiums decreased 1% and net written premiums decreased 2% for the second quarter of 2020 driven by the continued impact of the strategic exit from certain Lloyd’s business classes, offset by growth in Europe.

5

Life & Group
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Net investment income
$
206

 
 
$
205

 
 
$
414

 
 
$
409

 
Total operating revenues
332

 
 
335

 
 
667

 
 
670

 
Core income
14

 
 
7

 
 
18

 
 
17

 
Core income of $14 million for the second quarter of 2020 was primarily driven by better than expected persistency.
Corporate & Other
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Net investment income
$
4

 
 
$
7

 
 
$
7

 
 
$
14

 
Interest expense
31

 
 
34

 
 
62

 
 
68

 
Core loss
(11
)
 
 
(11
)
 
 
(29
)
 
 
(17
)
 
Core loss of $11 million for the second quarter of 2020 was consistent with the prior year quarter.
Net Investment Income
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
 
2020
 
2019
 
2020
 
2019
Pretax net investment income
$
534

 
 
$
515

 
 
$
863

 
 
$
1,086

 
Net investment income, after tax
436

 
 
420

 
 
709

 
 
885

 
Pretax net investment income increased $19 million as compared with the prior year quarter. The increase was driven by limited partnership and common stock investments, which returned 5.0%, or $84 million in the second quarter of 2020 compared with 2.1%, or $43 million, in the prior year quarter.

6

About the Company
CNA is one of the largest U.S. commercial property and casualty insurance companies. CNA provides a broad range of standard and specialized property and casualty insurance products and services for businesses and professionals in the U.S., Canada and Europe, backed by more than 120 years of experience and approximately $45 billion of assets.  For more information, please visit CNA at www.cna.com.
Conference Call and Webcast/Presentation Information
A conference call for investors and the professional investment community will be held at 8:00 a.m. (CT) today. On the conference call will be Dino E. Robusto, Chairman and Chief Executive Officer of CNA Financial Corporation, Al Miralles, Executive Vice President and Chief Financial Officer of CNA Financial Corporation and other members of senior management. Participants can access the call by dialing (800) 289-0571, or for international callers, +1 (720) 543-0206. The call will also be broadcast live on the internet and may be accessed from the Investor Relations page of the CNA website (www.cna.com). A presentation will be posted and available on the CNA website and will provide additional insight into the results.
The call is available to the media, but questions will be restricted to investors and the professional investment community. An online replay will be available on CNA's website following the call. Financial supplement information related to the results is available on the investor relations pages of the CNA website or by contacting [email protected].
Definition of Reported Segments
•
Specialty provides management and professional liability and other coverages through property and casualty products and services using a network of brokers, independent agencies and managing general underwriters.
•
Commercial works with a network of brokers and independent agents to market a broad range of property and casualty insurance products and services to small, middle-market and large businesses.
•
International underwrites property and casualty coverages on a global basis through two insurance companies based in the U.K. and Luxembourg, a branch operation in Canada as well as through our Lloyd's Syndicate.
•
Life & Group primarily includes the results of the individual and group long term care businesses that are in run off.
•
Corporate & Other primarily includes certain corporate expenses, including interest on corporate debt, and the results of certain property and casualty business in run-off, including CNA Re and asbestos and environmental pollution (A&EP).
Financial Measures
Management utilizes the following metrics in their evaluation of the Property & Casualty Operations. These ratios are calculated using financial results prepared in accordance with accounting principles generally accepted in the United States of America (GAAP).
•
Loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums.
•
Underlying loss ratio represents the loss ratio excluding catastrophes and development.
•
Expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums.
•
Dividend ratio is the ratio of policyholders' dividends incurred to net earned premiums.
•
Combined ratio is the sum of the loss, expense and dividend ratios.
•
Underlying combined ratio is the sum of the underlying loss, expense and dividend ratios.
•
Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes.
•
Rate represents the average change in price on policies that renew excluding exposure change. For certain products within Small Business, where quantifiable, rate includes the influence of new business as well.
•
Retention represents the percentage of premium dollars renewed in comparison to the expiring premium dollars from policies available to renew.
•
New business represents premiums from policies written with new customers and additional policies written with existing customers.
Gross written premiums ex. 3rd party captives represents gross written premiums excluding business which is mostly ceded to third party captives, including business related to large warranty programs.
The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk.

7

Reconciliation of GAAP Measures to Non-GAAP Measures
This press release also contains financial measures that are not in accordance with GAAP.  Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio. The Company believes the presentation of these measures provides investors with a better understanding of the significant factors that comprise the Company's operating performance. Reconciliations of these measures to the most comparable GAAP measures follow below.
Reconciliation of Net Income to Core Income
Core income (loss) is calculated by excluding from net income (loss) the after-tax effects of net investment gains or losses and any cumulative effects of changes in accounting guidance. The calculation of core income (loss) excludes net investment gains or losses because net investment gains or losses are generally driven by economic factors that are not necessarily reflective of our primary operations. Management monitors core income (loss) for each business segment to assess segment performance. Presentation of consolidated core income (loss) is deemed to be a non-GAAP financial measure.
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
($ millions)
2020
 
2019
 
2020
 
2019
Net income
$
151

 
$
278

 
$
90

 
$
620

Less: Net investment gains (losses)
52

 
(16
)
 
(117
)
 
8

Core income
$
99

 
$
294

 
$
207

 
$
612

Reconciliation of Net Income per Diluted Share to Core Income per Diluted Share
Core income (loss) per diluted share provides management and investors with a valuable measure of the Company's operating performance for the same reasons applicable to its underlying measure, core income (loss). Core income (loss) per diluted share is core income (loss) on a per diluted share basis.
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
 
2020
 
2019
 
2020
 
2019
Net income per diluted share
$
0.55

 
$
1.02

 
$
0.33

 
$
2.28

Less: Net investment gains (losses)
0.19

 
(0.06
)
 
(0.43
)
 
0.03

Core income per diluted share
$
0.36

 
$
1.08

 
$
0.76

 
$
2.25

Reconciliation of Book Value per Share to Book Value per Share Excluding AOCI
Book value per share excluding AOCI allows management and investors to analyze the amount of the Company's net worth primarily attributable to the Company's business operations. The Company believes this measurement is useful as it reduces the effect of items that can fluctuate significantly from period to period, primarily based on changes in interest rates.
 
June 30, 2020
 
December 31, 2019
Book value per share
$
42.91

 
$
45.00

Less: Per share impact of AOCI
0.57

 
0.19

Book value per share excluding AOCI
$
42.34

 
$
44.81


8

Calculation of Return on Equity and Core Return on Equity
Core return on equity provides management and investors with a measure of how effectively the Company is investing the portion of the Company's net worth that is primarily attributable to its business operations.
 
Results for the Three Months Ended June 30
 
Results for the Six Months Ended June 30
 
($ millions)
2020
 
2019
 
2020
 
2019
 
Annualized net income
$
603

 
$
1,114

 
$
179

 
$
1,240

 
Average stockholders' equity including AOCI (a)
11,003

 
11,771

 
11,930

 
11,652

 
Return on equity
5.5

%
9.5

%
1.5

%
10.6

%
 
 
 
 
 
 
 
 
 
Annualized core income
$
394

 
$
1,178

 
$
413

 
$
1,225

 
Average stockholders' equity excluding AOCI (a)
11,461

 
11,873

 
11,827

 
12,031

 
Core return on equity
3.4

%
9.9

%
3.5

%
10.2

%
(a)
Average stockholders' equity is calculated using a simple average of the beginning and ending balances for the period.
For additional information, please refer to CNA's most recent 10-K on file with the Securities and Exchange Commission, as well as the financial supplement, available at www.cna.com.
Forward-Looking Statements
This press release includes statements that relate to anticipated future events (forward-looking statements) rather than actual present conditions or historical events. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and generally include words such as “believes,” “expects,” “intends,” “anticipates,” “estimates” and similar expressions. Forward-looking statements, by their nature, are subject to a variety of inherent risks and uncertainties that could cause actual results to differ materially from the results projected. Many of these risks and uncertainties cannot be controlled by CNA. For a detailed description of these risks and uncertainties please refer to CNA’s filings with the Securities and Exchange Commission, available at www.cna.com.
Any forward-looking statements made in this press release are made by CNA as of the date of this press release. Further, CNA does not have any obligation to update or revise any forward-looking statement contained in this press release, even if CNA’s expectations or any related events, conditions or circumstances change.
Any descriptions of coverage under CNA policies or programs in this press release are provided for convenience only and are not to be relied upon with respect to questions of coverage, exclusions or limitations. With regard to all such matters, the terms and provisions of relevant insurance policies are primary and controlling. In addition, please note that all coverages may not be available in all states.
“CNA" is a registered trademark of CNA Financial Corporation. Certain CNA Financial Corporation subsidiaries use the "CNA" trademark in connection with insurance underwriting and claims activities. Copyright © 2020 CNA. All rights reserved.

# # #

9



cnalogoq12020a02.gif

 
 
 
 
 




CNA Financial Corporation
Supplemental Financial Information


June 30, 2020



This report is for informational purposes only and includes consolidated financial statements and financial exhibits that are unaudited. This report should be read in conjunction with documents filed with the U.S. Securities and Exchange Commission, including the most recent Annual Report on Form 10-K.

 
 
 
 
 



Table of Contents
 
Page
Consolidated Results
 
Statements of Operations
Results of Operations
 
International
Investment Information
 
Other
 
Life & Group Policyholder Reserves




Statements of Operations
Periods ended June 30
Three Months
 
 
Six Months
 
(In millions)
2020
 
2019
 
Change
 
 
2020
 
2019
 
Change
 
Revenues:
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earned premiums
$
1,850

 
$
1,824

 
1

%
 
$
3,719

 
$
3,627

 
3

%
Net investment income
534

 
515

 
4

 
 
863

 
1,086

 
(21
)
 
Net investment gains (losses)
69

 
(18
)
 
 
 
 
(147
)
 
13

 


 
Non-insurance warranty revenue
308

 
285

 
 
 
 
609

 
566

 
 
 
Other revenues
5

 
4

 
 
 
 
13

 
13

 

 
Total revenues
2,766

 
2,610

 
6

 
 
5,057

 
5,305

 
(5
)
 
Claims, Benefits and Expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
Insurance claims and policyholders' benefits
1,642

 
1,352

 
 
 
 
3,067

 
2,709

 


 
Amortization of deferred acquisition costs
342

 
338

 
 
 
 
686

 
680

 


 
Non-insurance warranty expense
285

 
263

 
 
 
 
566

 
523

 
 
 
Other operating expenses
284

 
281

 
 
 
 
583

 
564

 


 
Interest
31

 
34

 
 
 
 
62

 
68

 


 
Total claims, benefits and expenses
2,584

 
2,268

 
(14
)
 
 
4,964

 
4,544

 
(9
)
 
Income (loss) before income tax
182

 
342

 
 
 
 
93

 
761

 


 
Income tax (expense) benefit
(31
)
 
(64
)
 
 
 
 
(3
)
 
(141
)
 


 
Net income (loss)
$
151

 
$
278

 
(46
)
%
 
$
90

 
$
620

 
(85
)
%

1




Components of Income (Loss), Per Share Data and Return on Equity
Periods ended June 30
Three Months
 
 
Six Months
 
(In millions, except per share data)
2020
 
2019
 
 
2020
 
2019
 
Components of Income (Loss)
 
 
 
 
 
 
 
 
 
Core income (loss)
$
99

 
$
294

 
 
$
207

 
$
612

 
Net investment gains (losses)
52

 
(16
)
 
 
(117
)
 
8

 
Net income (loss)
$
151

 
$
278

 
 
$
90

 
$
620

 
 
 
 
 
 
 
 
 
 
 
Diluted Earnings (Loss) Per Common Share
 
 
 
 
 
 
 
 
 
Core income (loss)
$
0.36

 
$
1.08

 
 
$
0.76

 
$
2.25

 
Net investment gains (losses)
0.19

 
(0.06
)
 
 
(0.43
)
 
0.03

 
Diluted earnings (loss) per share
$
0.55

 
$
1.02

 
 
$
0.33


$
2.28

 
 
 
 
 
 
 
 
 
 
 
Weighted Average Outstanding Common Stock and Common Stock Equivalents
 
 
 
 
 
 
 
 
 
Basic
271.5

 
271.6

 
 
271.5

 
271.6

 
Diluted
272.0

 
272.4

 
 
272.3

 
272.5

 
 
 
 
 
 
 
 
 
 
 
Return on Equity
 
 
 
 
 
 
 
 
 
Net income (loss) (1)
5.5

%
9.5

%
 
1.5

%
10.6

%
Core income (loss) (2)
3.4

 
9.9

 
 
3.5

 
10.2

 
(1) Annualized net income (loss) divided by the average stockholders' equity including accumulated other comprehensive income (loss) (AOCI) for the period. Average equity including AOCI is calculated using a simple average of the beginning and ending balances for the period.
(2) Annualized core income (loss) divided by the average stockholders' equity excluding AOCI for the period. Average equity excluding AOCI is calculated using a simple average of the beginning and ending balances for the period.


2




Selected Balance Sheet Data and Statement of Cash Flows Data
(In millions, except per share data)
June 30, 2020
 
December 31, 2019
Total investments
$
47,757

 
$
47,744

Reinsurance receivables, net of allowance for uncollectible receivables
4,435

 
4,179

Total assets
62,095

 
60,612

Insurance reserves
39,862

 
38,614

Debt
2,680

 
2,679

Total liabilities
50,450

 
48,397

Accumulated other comprehensive income (loss) (1)
154

 
51

Total stockholders' equity
11,645

 
12,215

 
 
 
 
Book value per common share
$
42.91

 
$
45.00

Book value per common share excluding AOCI
$
42.34

 
$
44.81

 
 
 
 
Outstanding shares of common stock (in millions of shares)
271.4

 
271.4

 
 
 
 
Statutory capital and surplus - Combined Continental Casualty Companies (2)
$
9,952

 
$
10,787

Three Months Ended June 30
2020
 
2019
Net cash flows provided (used) by operating activities
$
438

 
$
227

Net cash flows provided (used) by investing activities
(612
)
 
(56
)
Net cash flows provided (used) by financing activities
(101
)
 
(123
)
Net cash flows provided (used) by operating, investing and financing activities
$
(275
)
 
$
48

Six Months Ended June 30
2020
 
2019
Net cash flows provided (used) by operating activities
$
650

 
$
514

Net cash flows provided (used) by investing activities
475

 
233

Net cash flows provided (used) by financing activities
(776
)
 
(788
)
Net cash flows provided (used) by operating, investing and financing activities
$
349

 
$
(41
)


(1) As of June 30, 2020 and December 31, 2019, the net unrealized gains on investments included in AOCI were net of after-tax Shadow Adjustments of $2,342 million and $2,198 million. To the extent that unrealized gains on fixed income securities supporting certain products within the Life & Group segment would result in a premium deficiency if realized, an increase in Insurance reserves are recorded, net of tax, as a reduction of net unrealized gains through Other comprehensive income (loss) (Shadow Adjustments).
(2) Statutory capital and surplus as of June 30, 2020 is preliminary.

3




Property & Casualty - Results of Operations
Periods ended June 30
Three Months
 
 
Six Months
 
(In millions)
2020
 
2019
 
Change
 
 
2020
 
2019
 
Change
 
Gross written premiums
$
3,165

 
$
3,035

 
4

%
 
$
6,248

 
$
6,001

 
4

%
Gross written premiums ex. 3rd party captives
2,132

 
2,000

 
7

 
 
4,239

 
3,987

 
6

 
Net written premiums
1,930

 
1,874

 
3

 
 
3,793

 
3,680

 
3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earned premiums
1,724

 
1,694

 
2

 
 
3,466

 
3,368

 
3

 
Net investment income
324

 
303

 
 
 
 
442

 
663

 


 
Non-insurance warranty revenue
308

 
285

 
 
 
 
609

 
566

 
 
 
Other revenues
5

 
3

 
 
 
 
13

 
11

 


 
Total operating revenues
2,361

 
2,285

 
3

 
 
4,530

 
4,608

 
(2
)
 
Insurance claims and policyholders' benefits
1,356

 
1,055

 
 
 
 
2,479

 
2,125

 


 
Amortization of deferred acquisition costs
342

 
338

 
 
 
 
686

 
680

 


 
Non-insurance warranty expense
285

 
263

 
 
 
 
566

 
523

 
 
 
Other insurance related expenses
236

 
229

 
 
 
 
468

 
454

 


 
Other expenses
21

 
22

 
 
 
 
53

 
49

 


 
Total claims, benefits and expenses
2,240

 
1,907

 
(17
)
 
 
4,252

 
3,831

 
(11
)
 
Core income (loss) before income tax
121

 
378

 
 
 
 
278

 
777

 


 
Income tax (expense) benefit on core income (loss)
(25
)
 
(80
)
 
 
 
 
(60
)
 
(165
)
 


 
Core income (loss)
$
96

 
$
298

 
(68
)
%
 
$
218

 
$
612

 
(64
)
%
 
 
 
 
 
 
 
 
 
 
 
 


 
Other Performance Metrics
 
 
 
 
 
 
 
 
 
 
 


 
Underwriting gain (loss)
$
(210
)
 
$
72

 
N/M

%
 
$
(167
)
 
$
109

 
N/M

%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss & LAE ratio
78.4

%
61.9

%
(16.5
)
pts
 
71.2

%
62.7

%
(8.5
)
pts
Expense ratio
33.6

 
33.4

 
(0.2
)
 
 
33.2

 
33.7

 
0.5

 
Dividend ratio
0.3

 
0.4

 
0.1

 
 
0.4

 
0.4

 
—

 
Combined ratio
112.3

%
95.7

%
(16.6
)
pts
 
104.8

%
96.8

%
(8.0
)
pts
Combined ratio excluding catastrophes and development
93.4

%
94.6

%
1.2

pts
 
93.5

%
94.8

%
1.3

pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net accident year catastrophe losses incurred
$
301

 
$
38

 
 
 
 
$
376

 
$
96

 

 
Effect on loss & LAE ratio
17.5

%
2.2

%
(15.3
)
pts
 
10.9

%
2.9

%
(8.0
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net prior year development and other: (favorable) / unfavorable
$
25

 
$
(19
)
 
 
 
 
$
14

 
$
(28
)
 


 
Effect on loss & LAE ratio
1.4

%
(1.1
)
%
(2.5
)
pts
 
0.4

%
(0.9
)
%
(1.3
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rate
11

%
4

%
7

pts
 
10

%
4

%
6

pts
Renewal premium change
9

%
6

%
3

pts
 
9

%
5

%
4

pts
Retention
83

%
84

%
(1
)
pts
 
82

%
84

%
(2
)
pts
New business
$
363

 
$
358

 
1

%
 
$
703

 
$
687

 
2

%


4




Specialty - Results of Operations
Periods ended June 30
Three Months
 
 
Six Months
 
(In millions)
2020
 
2019
 
Change
 
 
2020
 
2019
 
Change
 
Gross written premiums
$
1,762

 
$
1,724

 
2

%
 
$
3,476

 
$
3,425

 
1

%
Gross written premiums ex. 3rd party captives
811

 
755

 
7

 
 
1,552

 
1,485

 
5

 
Net written premiums
742

 
713

 
4

 
 
1,436

 
1,411

 
2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earned premiums
705

 
688

 
2

 
 
1,390

 
1,349

 
3

 
Net investment income
133

 
134

 
 
 
 
189

 
289

 


 
Non-insurance warranty revenue
308

 
285

 
 
 
 
609

 
566

 
 
 
Other revenues
—

 
(1
)
 
 
 
 
1

 
—

 


 
Total operating revenues
1,146

 
1,106

 
4

 
 
2,189

 
2,204

 
(1
)
 
Insurance claims and policyholders' benefits
509

 
396

 
 
 
 
915

 
789

 


 
Amortization of deferred acquisition costs
153

 
152

 
 
 
 
304

 
299

 


 
Non-insurance warranty expense
285

 
263

 
 
 
 
566

 
523

 
 
 
Other insurance related expenses
73

 
76

 
 
 
 
142

 
146

 


 
Other expenses
10

 
12

 
 
 
 
23

 
24

 


 
Total claims, benefits and expenses
1,030

 
899

 
(15
)
 
 
1,950

 
1,781

 
(9
)
 
Core income (loss) before income tax
116

 
207

 
 
 
 
239

 
423

 


 
Income tax (expense) benefit on core income (loss)
(26
)
 
(46
)
 
 
 
 
(53
)
 
(93
)
 


 
Core income (loss)
$
90

 
$
161

 
(44
)
%
 
$
186

 
$
330

 
(44
)
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Performance Metrics
 
 
 
 
 
 
 
 
 
 
 
 
 
Underwriting gain (loss)
$
(30
)
 
$
64

 
(147
)
%
 
$
29

 
$
115

 
(75
)
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss & LAE ratio
72.0

%
57.4

%
(14.6
)
pts
 
65.6

%
58.3

%
(7.3
)
pts
Expense ratio
32.0

 
33.1

 
1.1

 
 
32.1

 
33.0

 
0.9

 
Dividend ratio
0.2

 
0.2

 
—

 
 
0.2

 
0.2

 
—

 
Combined ratio
104.2

%
90.7

%
(13.5
)
pts
 
97.9

%
91.5

%
(6.4
)
pts
Combined ratio excluding catastrophes and development
92.1

%
93.2

%
1.1

pts
 
92.0

%
93.4

%
1.4

pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net accident year catastrophe losses incurred
$
105

 
$
1

 
 
 
 
$
113

 
$
13

 


 
Effect on loss & LAE ratio
15.0

%
0.1

%
(14.9
)
pts
 
8.2

%
1.0

%
(7.2
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net prior year development and other: (favorable) / unfavorable
$
(20
)
 
$
(18
)
 
 
 
 
$
(31
)
 
$
(38
)
 


 
Effect on loss & LAE ratio
(2.9
)
%
(2.6
)
%
0.3

pts
 
(2.3
)
%
(2.9
)
%
(0.6
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rate
12

%
4

%
8

pts
 
10

%
3

%
7

pts
Renewal premium change
11

%
5

%
6

pts
 
10

%
6

%
4

pts
Retention
85

%
89

%
(4
)
pts
 
85

%
89

%
(4
)
pts
New business
$
96

 
$
97

 
(1
)
%
 
$
170

 
$
182

 
(7
)
%

5




Commercial - Results of Operations
Periods ended June 30
Three Months
 
 
Six Months
 
(In millions)
2020
 
2019
 
Change
 
 
2020
 
2019
 
Change
 
Gross written premiums
$
1,126

 
$
1,024

 
10

%
 
$
2,188

 
$
1,965

 
11

%
Gross written premiums ex. 3rd party captives
1,044

 
958

 
9

 
 
2,103

 
1,891

 
11

 
Net written premiums
949

 
912

 
4

 
 
1,899

 
1,761

 
8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earned premiums
795

 
763

 
4

 
 
1,613

 
1,526

 
6

 
Net investment income
177

 
154

 
 
 
 
224

 
344

 


 
Other revenues
5

 
3

 
 
 
 
12

 
10

 


 
Total operating revenues
977

 
920

 
6

 
 
1,849

 
1,880

 
(2
)
 
Insurance claims and policyholders' benefits
671

 
512

 
 
 
 
1,234

 
1,027

 


 
Amortization of deferred acquisition costs
147

 
130

 
 
 
 
291

 
257

 


 
Other insurance related expenses
124

 
119

 
 
 
 
251

 
249

 


 
Other expenses
13

 
7

 
 
 
 
19

 
18

 


 
Total claims, benefits and expenses
955

 
768

 
(24
)
 
 
1,795

 
1,551

 
(16
)
 
Core income (loss) before income tax
22

 
152

 
 
 
 
54

 
329

 


 
Income tax (expense) benefit on core income (loss)
(2
)
 
(32
)
 
 
 
 
(10
)
 
(70
)
 


 
Core income (loss)
$
20

 
$
120

 
(83
)
%
 
$
44

 
$
259

 
(83
)
%
 
 
 
 
 
 
 
 
 
 
 
 


 
Other Performance Metrics
 
 
 
 
 
 
 
 
 
 
 


 
Underwriting gain (loss)
$
(147
)
 
$
2

 
N/M

%
 
$
(163
)
 
$
(7
)
 
N/M

%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss & LAE ratio
84.0

%
66.5

%
(17.5
)
pts
 
75.9

%
66.7

%
(9.2
)
pts
Expense ratio
33.9

 
32.6

 
(1.3
)
 
 
33.6

 
33.2

 
(0.4
)
 
Dividend ratio
0.6

 
0.6

 
—

 
 
0.6

 
0.6

 
—

 
Combined ratio
118.5

%
99.7

%
(18.8
)
pts
 
110.1

%
100.5

%
(9.6
)
pts
Combined ratio excluding catastrophes and development
93.5

%
94.9

%
1.4

pts
 
94.3

%
95.7

%
1.4

pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net accident year catastrophe losses incurred
$
151

 
$
37

 
 
 
 
$
208

 
$
77

 


 
Effect on loss & LAE ratio
19.0

%
4.9

%
(14.1
)
pts
 
12.8

%
5.1

%
(7.7
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net prior year development and other: (favorable) / unfavorable
$
48

 
$
—

 
 
 
 
$
48

 
$
(3
)
 


 
Effect on loss & LAE ratio
6.0

%
(0.1
)
%
(6.1
)
pts
 
3.0

%
(0.3
)
%
(3.3
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rate
9

%
3

%
6

pts
 
9

%
3

%
6

pts
Renewal premium change
8

%
5

%
3

pts
 
8

%
5

%
3

pts
Retention
83

%
87

%
(4
)
pts
 
84

%
86

%
(2
)
pts
New business
$
205

 
$
186

 
10

%
 
$
403

 
$
350

 
15

%

6




International - Results of Operations
Periods ended June 30
Three Months
 
 
Six Months
 
(In millions)
2020
 
2019
 
Change
 
 
2020
 
2019
 
Change
 
Gross written premiums
$
277

 
$
287

 
(3
)
%
 
$
584

 
$
611

 
(4
)
%
Net written premiums
239

 
249

 
(4
)
 
 
458

 
508

 
(10
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net earned premiums
224

 
243

 
(8
)
 
 
463

 
493

 
(6
)
 
Net investment income
14

 
15

 
 
 
 
29

 
30

 


 
Other revenues
—

 
1

 
 
 
 
—

 
1

 


 
Total operating revenues
238

 
259

 
(8
)
 
 
492

 
524

 
(6
)
 
Insurance claims and policyholders' benefits
176

 
147

 
 
 
 
330

 
309

 


 
Amortization of deferred acquisition costs
42

 
56

 
 
 
 
91

 
124

 


 
Other insurance related expenses
39

 
34

 
 
 
 
75

 
59

 


 
Other expenses
(2
)
 
3

 
 
 
 
11

 
7

 


 
Total claims, benefits and expenses
255

 
240

 
(6
)
 
 
507

 
499

 
(2
)
 
Core income (loss) before income tax
(17
)
 
19

 
 
 
 
(15
)
 
25

 


 
Income tax (expense) benefit on core income (loss)
3

 
(2
)
 
 
 
 
3

 
(2
)
 


 
Core income (loss)
$
(14
)
 
$
17

 
(182
)
%
 
$
(12
)
 
$
23

 
(152
)
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Performance Metrics
 
 
 
 
 
 
 
 
 
 
 
 
 
Underwriting gain (loss)
$
(33
)
 
$
6

 
N/M

%
 
$
(33
)
 
$
1

 
N/M

%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss & LAE ratio
78.6

%
60.2

%
(18.4
)
pts
 
71.3

%
62.5

%
(8.8
)
pts
Expense ratio
36.7

 
37.3

 
0.6

 
 
36.1

 
37.2

 
1.1

 
Dividend ratio
—

 
—

 
—

 
 
—

 
—

 
—

 
Combined ratio
115.3

%
97.5

%
(17.8
)
pts
 
107.4

%
99.7

%
(7.7
)
pts
Combined ratio excluding catastrophes and development
96.6

%
97.4

%
0.8

pts
 
96.2

%
95.7

%
(0.5
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net accident year catastrophe losses incurred
$
45

 
$
—

 
 
 
 
$
55

 
$
6

 


 
Effect on loss & LAE ratio
19.9

%
0.2

%
(19.7
)
pts
 
11.9

%
1.3

%
(10.6
)
pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net prior year development and other: (favorable) / unfavorable
$
(3
)
 
$
(1
)
 
 
 
 
$
(3
)
 
$
13

 


 
Effect on loss & LAE ratio
(1.2
)
%
(0.1
)
%
1.1

pts
 
(0.7
)
%
2.7

%
3.4

pts
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Rate
13

%
7

%
6

pts
 
11

%
6

%
5

pts
Renewal premium change
11

%
8

%
3

pts
 
9

%
4

%
5

pts
Retention
74

%
70

%
4

pts
 
72

%
69

%
3

pts
New business
$
62

 
$
75

 
(17
)
%
 
$
130

 
$
155

 
(16
)
%

7




Life & Group - Results of Operations
Periods ended June 30
Three Months
 
 
Six Months
(In millions)
2020
 
2019
 
 
2020
 
2019
Net earned premiums
$
126

 
$
130

 
 
$
253

 
$
260

Net investment income
206

 
205

 
 
414

 
409

Other revenues
—

 
—

 
 
—

 
1

Total operating revenues
332

 
335

 
 
667

 
670

Insurance claims and policyholders' benefits
304

 
309

 
 
620

 
617

Other insurance related expenses
25

 
30

 
 
51

 
58

Other expenses
—

 
2

 
 
3

 
4

Total claims, benefits and expenses
329

 
341

 
 
674

 
679

Core income (loss) before income tax
3

 
(6
)
 
 
(7
)
 
(9
)
Income tax (expense) benefit on core income (loss)
11

 
13

 
 
25

 
26

Core income (loss)
$
14

 
$
7

 
 
$
18

 
$
17



8




Corporate & Other - Results of Operations
Periods ended June 30
Three Months
 
 
Six Months
(In millions)
2020
 
2019
 
 
2020
 
2019
Net earned premiums
$
—

 
$
—

 
 
$
—

 
$
(1
)
Net investment income
4

 
7

 
 
7

 
14

Other revenues
—

 
1

 
 
—

 
1

Total operating revenues
4

 
8

 
 
7

 
14

Insurance claims and policyholders' benefits
(18
)
 
(12
)
 
 
(32
)
 
(33
)
Other insurance related expenses
(1
)
 
(1
)
 
 
(1
)
 
(3
)
Other expenses
34

 
33

 
 
71

 
70

Total claims, benefits and expenses
15

 
20

 
 
38

 
34

Core income (loss) before income tax
(11
)
 
(12
)
 
 
(31
)
 
(20
)
Income tax (expense) benefit on core income (loss)
—

 
1

 
 
2

 
3

Core income (loss)
$
(11
)
 
$
(11
)
 
 
$
(29
)
 
$
(17
)


9




Investment Summary - Consolidated
 
June 30, 2020
 
March 31, 2020

December 31, 2019
(In millions)
Carrying Value
 
Net Unrealized Gains (Losses)
 
Carrying Value
 
Net Unrealized Gains (Losses)
 
Carrying Value
 
Net Unrealized Gains (Losses)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
22,808

 
$
2,537

 
$
20,749

 
$
602

 
$
22,069

 
$
2,260

States, municipalities and political subdivisions:
 
 
 
 
 
 
 
 
 
 
 
Tax-exempt
8,185

 
1,199

 
7,839

 
1,113

 
7,804

 
1,155

Taxable
2,942

 
502

 
2,652

 
421

 
2,848

 
404

Total states, municipalities and political subdivisions
11,127

 
1,701

 
10,491

 
1,534

 
10,652

 
1,559

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
RMBS
3,784

 
167

 
4,397

 
199

 
4,519

 
132

CMBS
2,116

 
(23
)
 
2,090

 
(117
)
 
2,346

 
81

Other ABS
1,959

 
19

 
1,744

 
(124
)
 
1,962

 
37

Total asset-backed
7,859

 
163

 
8,231

 
(42
)
 
8,827

 
250

U.S. Treasury and obligations of government-sponsored enterprises
498

 
7

 
155

 
8

 
145

 
(1
)
Foreign government
483

 
26

 
463

 
11

 
504

 
13

Redeemable preferred stock
—

 
—

 
9

 
—

 
10

 
—

Total fixed maturity securities
42,775

 
4,434

 
40,098

 
2,113

 
42,207

 
4,081

Equities:
 
 
 
 
 
 
 
 
 
 
 
Common stock
154

 
—

 
191

 
—

 
142

 
—

Non-redeemable preferred stock
705

 
—

 
608

 
—

 
723

 
—

Total equities
859

 
—

 
799

 
—

 
865


—

Limited partnership investments
1,558

 
—

 
1,509

 
—

 
1,752

 
—

Other invested assets
65

 
—

 
63

 
—

 
65

 
—

Mortgage loans
1,042

 
—

 
1,021

 
—

 
994

 
—

Short term investments
1,458

 
1

 
596

 
(2
)
 
1,861

 
—

Total investments
$
47,757

 
$
4,435

 
$
44,086


$
2,111


$
47,744


$
4,081

 
 
 
 
 
 
 
 
 
 
 
 
Net receivable/(payable) on investment activity
$
(403
)
 
 
 
$
136

 
 
 
$
37

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effective duration (in years)
6.0

 
 
 
6.0

 
 
 
6.0

 
 
Weighted average rating
A

 
 
 
A

 
 
 
A

 
 
RMBS - Residential mortgage-backed securities
CMBS - Commercial mortgage-backed securities
Other ABS - Other asset-backed securities

10




Investment Summary - Property & Casualty and Corporate & Other
 
June 30, 2020
 
March 31, 2020
 
December 31, 2019
(In millions)
Carrying Value
 
Net Unrealized Gains (Losses)
 
Carrying Value
 
Net Unrealized Gains (Losses)
 
Carrying Value
 
Net Unrealized Gains (Losses)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
14,383

 
$
888

 
$
13,243

 
$
(203
)
 
$
13,925

 
$
738

States, municipalities and political subdivisions:
 
 
 
 
 
 
 
 
 
 
 
Tax-exempt
1,154

 
61

 
683

 
33

 
646

 
37

Taxable
1,030

 
87

 
912

 
74

 
1,077

 
71

Total states, municipalities and political subdivisions
2,184

 
148

 
1,595

 
107

 
1,723

 
108

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
RMBS
3,702

 
162

 
4,312

 
196

 
4,441

 
128

CMBS
2,028

 
(25
)
 
2,005

 
(116
)
 
2,264

 
77

Other ABS
1,783

 
1

 
1,612

 
(122
)
 
1,842

 
29

Total asset-backed
7,513

 
138

 
7,929

 
(42
)
 
8,547

 
234

U.S. Treasury and obligations of government-sponsored enterprises
489

 
7

 
145

 
8

 
143

 
(1
)
Foreign government
477

 
25

 
458

 
11

 
498

 
12

Redeemable preferred stock
—

 
—

 
4

 
—

 
5

 
—

Total fixed maturity securities
25,046

 
1,206

 
23,374

 
(119
)
 
24,841

 
1,091

Equities:
 
 
 
 
 
 
 
 
 
 
 
Common stock
154

 
—

 
191

 
—

 
142

 
—

Non-redeemable preferred stock
168

 
—

 
156

 
—

 
181

 
—

Total equities
322

 
—

 
347

 
—

 
323

 
—

Limited partnership investments
1,558

 
—

 
1,509

 
—

 
1,752

 
—

Other invested assets
65

 
—

 
63

 
—

 
65

 
—

Mortgage loans
761

 
—

 
749

 
—

 
715

 
—

Short term investments
1,397

 
1

 
583

 
(2
)
 
1,774

 
—

Total investments
$
29,149

 
$
1,207

 
$
26,625


$
(121
)

$
29,470


$
1,091

 
 
 
 
 
 
 
 
 
 
 
 
Net receivable/(payable) on investment activity
$
(446
)
 
 
 
$
124

 
 
 
$
17

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effective duration (in years)
4.1

 
 
 
4.1

 
 
 
4.1

 
 
Weighted average rating
A

 
 
 
A-

 
 
 
A-

 
 

11




Investment Summary - Life & Group
 
June 30, 2020
 
March 31, 2020
 
December 31, 2019
(In millions)
Carrying Value
 
Net Unrealized Gains (Losses)
 
Carrying Value
 
Net Unrealized Gains (Losses)
 
Carrying Value
 
Net Unrealized Gains (Losses)
Fixed maturity securities:
 
 
 
 
 
 
 
 
 
 
 
Corporate and other bonds
$
8,425

 
$
1,649

 
$
7,506

 
$
805

 
$
8,144

 
$
1,522

States, municipalities and political subdivisions:
 
 
 
 
 
 
 
 
 
 
 
Tax-exempt
7,031

 
1,138

 
7,156

 
1,080

 
7,158

 
1,118

Taxable
1,912

 
415

 
1,740

 
347

 
1,771

 
333

Total states, municipalities and political subdivisions
8,943

 
1,553

 
8,896

 
1,427

 
8,929

 
1,451

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
RMBS
82

 
5

 
85

 
3

 
78

 
4

CMBS
88

 
2

 
85

 
(1
)
 
82

 
4

Other ABS
176

 
18

 
132

 
(2
)
 
120

 
8

Total asset-backed
346

 
25

 
302

 
—

 
280

 
16

U.S. Treasury and obligations of government-sponsored enterprises
9

 
—

 
10

 
—

 
2

 
—

Foreign government
6

 
1

 
5

 
—

 
6

 
1

Redeemable preferred stock
—

 
—

 
5

 
—

 
5

 
—

Total fixed maturity securities
17,729

 
3,228

 
16,724

 
2,232

 
17,366

 
2,990

Equities:
 
 
 
 
 
 
 
 
 
 
 
Common stock
—

 
—

 
—

 
—

 
—

 
—

Non-redeemable preferred stock
537

 
—

 
452

 
—

 
542

 
—

Total equities
537

 
—

 
452


—


542


—

Limited partnership investments
—

 
—

 
—

 
—

 
—

 
—

Other invested assets
—

 
—

 
—

 
—

 
—

 
—

Mortgage loans
281

 
—

 
272

 
—

 
279

 
—

Short term investments
61

 
—

 
13

 
—

 
87

 
—

Total investments
$
18,608

 
$
3,228

 
$
17,461


$
2,232


$
18,274


$
2,990

 
 
 
 
 
 
 
 
 
 
 
 
Net receivable/(payable) on investment activity
$
43

 
 
 
$
12

 
 
 
$
20

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Effective duration (in years)
8.8

 
 
 
8.7

 
 
 
8.9

 
 
Weighted average rating
A

 
 
 
A

 
 
 
A

 
 

12




Investments - Fixed Maturity Securities by Credit Rating  
June 30, 2020
U.S. Government, Government agencies and Government-sponsored enterprises
 
AAA
 
AA
 
A
 
BBB
 
Non-investment grade
 
Total
(In millions)
Fair Value
 
Net Unrealized Gains (Losses)
 
Fair Value
 
Net Unrealized Gains (Losses)
 
Fair Value
 
Net Unrealized Gains (Losses)
 
Fair Value
 
Net Unrealized Gains (Losses)
 
Fair Value
 
Net Unrealized Gains (Losses)
 
Fair Value
 
Net Unrealized Gains (Losses)
 
Fair Value
 
Net Unrealized Gains (Losses)
Corporate and other bonds
$
—

 
$
—

 
$
49

 
$
2

 
$
485

 
$
55

 
$
5,135

 
$
779

 
$
15,267

 
$
1,740

 
$
1,872

 
$
(39
)
 
$
22,808

 
$
2,537

States, municipalities and political subdivisions:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tax-exempt
—

 
—

 
2,508

 
377

 
3,516

 
532

 
1,910

 
261

 
235

 
29

 
16

 
—

 
8,185

 
1,199

Taxable
—

 
—

 
530

 
39

 
1,609

 
284

 
769

 
177

 
34

 
1

 
—

 
1

 
2,942

 
502

Total states, municipalities and political subdivisions
—

 
—

 
3,038

 
416

 
5,125

 
816

 
2,679

 
438

 
269

 
30

 
16

 
1

 
11,127

 
1,701

Asset-backed:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
RMBS
3,472

 
142

 
6

 
—

 
24

 
1

 
36

 
1

 
12

 
1

 
234

 
22

 
3,784

 
167

CMBS
27

 
—

 
328

 
21

 
741

 
32

 
278

 
(11
)
 
541

 
(41
)
 
201

 
(24
)
 
2,116

 
(23
)
Other ABS
—

 
—

 
43

 
(1
)
 
106

 
3

 
1,045

 
5

 
750

 
10

 
15

 
2

 
1,959

 
19

Total asset-backed
3,499

 
142

 
377

 
20

 
871

 
36

 
1,359

 
(5
)
 
1,303

 
(30
)
 
450

 
—

 
7,859

 
163

U.S. Treasury and obligations of government-sponsored enterprises
498

 
7

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
498

 
7

Foreign government
—

 
—

 
135

 
5

 
236

 
13

 
84

 
6

 
28

 
2

 
—

 
—

 
483

 
26

Redeemable preferred stock
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

 
—

Total fixed maturity securities
$
3,997

 
$
149

 
$
3,599

 
$
443

 
$
6,717

 
$
920

 
$
9,257

 
$
1,218

 
$
16,867

 
$
1,742

 
$
2,338

 
$
(38
)
 
$
42,775

 
$
4,434

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Percentage of total fixed maturity securities
9
%
 
 
 
8
%
 
 
 
16
%
 
 
 
22
%
 
 
 
40
%
 
 
 
5
%
 
 
 
100
%
 
 

13




Components of Net Investment Income
 
Consolidated

 
Periods ended June 30
Three Months
 
Six Months
 
(In millions)
2020
 
2019
 
2020
 
2019
 
    Taxable fixed income securities
$
360

 
$
385

 
$
731

 
$
768

 
    Tax-exempt fixed income securities
80

 
80

 
158

 
162

 
Total fixed income securities
440

 
465

 
889

 
930

 
Limited partnership and common stock investments
84

 
43

 
(41
)
 
139

 
Other, net of investment expense
10

 
7

 
15

 
17

 
Pretax net investment income
$
534

 
$
515

 
$
863

 
$
1,086

 
Fixed income securities, after tax
$
361

 
$
382

 
$
728

 
$
762

 
Net investment income, after tax
436

 
420

 
709

 
885

 
 
 
 
 
 
 
 
 
 
Effective income yield for fixed income securities, pretax
4.6

%
4.8

%
4.6

%
4.8

%
Effective income yield for fixed income securities, after tax
3.8

 
3.9

 
3.8

 
3.9

 
Limited partnership and common stock return
5.0

 
2.1

 
(2.3
)
 
6.8

 
 
Property & Casualty and Corporate & Other
 
Periods ended June 30
Three Months
 
Six Months
 
(In millions)
2020
 
2019
 
2020
 
2019
 
    Taxable fixed income securities
$
225

 
$
254

 
$
459

 
$
507

 
    Tax-exempt fixed income securities
8

 
5

 
13

 
11

 
Total fixed income securities
233

 
259

 
472

 
518

 
Limited partnership and common stock investments
84

 
43

 
(41
)
 
139

 
Other, net of investment expense
11

 
8

 
18

 
20

 
Pretax net investment income
$
328

 
$
310

 
$
449

 
$
677

 
Fixed income securities, after tax
$
187

 
$
206

 
$
376

 
$
411

 
Net investment income, after tax
261

 
246

 
358

 
537

 
 
 
 
 
 
 
 
 
 
Effective income yield for fixed income securities, pretax
4.0

%
4.3

%
4.0

%
4.3

%
Effective income yield for fixed income securities, after tax
3.2

 
3.5

 
3.2

 
3.4

 
 
Life & Group

 
Periods ended June 30
Three Months
 
Six Months
 
(In millions)
2020
 
2019
 
2020
 
2019
 
    Taxable fixed income securities
$
135

 
$
131

 
$
272

 
$
261

 
    Tax-exempt fixed income securities
72

 
75

 
145

 
151

 
Total fixed income securities
207

 
206

 
417

 
412

 
Limited partnership and common stock investments
—

 
—

 
—

 
—

 
Other, net of investment expense
(1
)
 
(1
)
 
(3
)
 
(3
)
 
Pretax net investment income
$
206

 
$
205

 
$
414

 
$
409

 
Fixed income securities, after tax
$
174

 
$
176

 
$
352

 
$
351

 
Net investment income, after tax
175

 
174

 
351

 
348

 
 
 
 
 
 
 
 
 
 
Effective income yield for fixed income securities, pretax
5.5

%
5.6

%
5.6

%
5.6

%
Effective income yield for fixed income securities, after tax
4.7

 
4.8

 
4.7

 
4.8

 

14




Claim & Claim Adjustment Expense Reserve Rollforward
Three months ended June 30, 2020
(In millions)

Specialty
 

Commercial
 
International
 
P&C Operations
 
Life & Group
 
Corporate & Other
 
Total Operations
Claim & claim adjustment expense reserves, beginning of period
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross
$
5,472

 
$
8,704

 
$
1,818

 
$
15,994

 
$
3,712

 
$
2,166

 
$
21,872

Ceded
777

 
813

 
235

 
1,825

 
146

 
1,996

 
3,967

Net
4,695

 
7,891


1,583


14,169


3,566


170


17,905

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net incurred claim & claim adjustment expenses
508

 
666

 
176

 
1,350

 
267

 
1

 
1,618

Net claim & claim adjustment expense payments
(384
)
 
(540
)
 
(126
)
 
(1,050
)
 
(254
)
 
(4
)
 
(1,308
)
Foreign currency translation adjustment and other
—

 
2

 
21

 
23

 
30

 
—

 
53

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Claim & claim adjustment expense reserves, end of period
 
 
 
 
 
 
 
 
 
 
 
 
 
Net
4,819

 
8,019

 
1,654

 
14,492

 
3,609

 
167

 
18,268

Ceded
877

 
811

 
252

 
1,940

 
142

 
1,920

 
4,002

Gross
$
5,696

 
$
8,830

 
$
1,906

 
$
16,432

 
$
3,751

 
$
2,087

 
$
22,270


Six months ended June 30, 2020
(In millions)

Specialty
 

Commercial
 
International
 
P&C Operations
 
Life & Group
 
Corporate & Other
 
Total Operations
Claim & claim adjustment expense reserves, beginning of period
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross
$
5,238

 
$
8,656

 
$
1,876

 
$
15,770

 
$
3,716

 
$
2,234

 
$
21,720

Ceded
562

 
807

 
248

 
1,617

 
159

 
2,059

 
3,835

Net
4,676

 
7,849

 
1,628

 
14,153

 
3,557

 
175

 
17,885

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net incurred claim & claim adjustment expenses
913

 
1,224

 
330

 
2,467

 
547

 
2

 
3,016

Net claim & claim adjustment expense payments
(771
)
 
(1,055
)
 
(258
)
 
(2,084
)
 
(505
)
 
(9
)
 
(2,598
)
Foreign currency translation adjustment and other
1

 
1

 
(46
)
 
(44
)
 
10

 
(1
)
 
(35
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Claim & claim adjustment expense reserves, end of period
 
 
 
 
 
 
 
 
 
 
 
 
 
Net
4,819

 
8,019

 
1,654

 
14,492

 
3,609

 
167

 
18,268

Ceded
877

 
811

 
252

 
1,940

 
142

 
1,920

 
4,002

Gross
$
5,696

 
$
8,830

 
$
1,906

 
$
16,432

 
$
3,751

 
$
2,087

 
$
22,270



15




Life & Group Policyholder Reserves
June 30, 2020
 
 
 
 
 
(In millions)
Claim and claim adjustment expenses
 
Future policy benefits
 
Total
Long term care
$
2,914

 
$
9,543

 
$
12,457

Structured settlement annuities
506

 
—

 
506

Other
13

 
—

 
13

Total
3,433

 
9,543

 
12,976

Shadow adjustments
176

 
2,789

 
2,965

Ceded reserves
142

 
264

 
406

Total gross reserves
$
3,751

 
$
12,596

 
$
16,347

December 31, 2019
 
 
 
 
 
(In millions)
Claim and claim adjustment expenses
 
Future policy benefits
 
Total
Long term care
$
2,863

 
$
9,470

 
$
12,333

Structured settlement annuities
515

 
—

 
515

Other
12

 
—

 
12

Total
3,390

 
9,470

 
12,860

Shadow adjustments
167

 
2,615

 
2,782

Ceded reserves
159

 
226

 
385

Total gross reserves
$
3,716

 
$
12,311

 
$
16,027


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Definitions and Presentation
•
Collectively, CNA Financial Corporation (CNAF) and its subsidiaries are referred to as CNA or the Company.
•
P&C Operations includes Specialty, Commercial and International.
•
Life & Group segment primarily includes the results of long term care businesses that are in run-off.
•
Corporate & Other segment primarily includes certain corporate expenses including interest on corporate debt and the results of certain property and casualty business in run-off, including CNA Re and asbestos and environmental pollution. Intersegment eliminations are also included in this segment.
•
Management uses the core income (loss) financial measure to monitor the Company’s operations. Please refer to Note I to the Consolidated Financial Statements within the December 31, 2019 Form 10-K for further discussion of this non-GAAP financial measure.
•
Management uses underwriting results to monitor insurance operations. Underwriting results are pretax and are calculated as net earned premiums less total insurance expenses, which includes insurance claims and policyholders' benefits, amortization of deferred acquisition costs and other insurance related expenses.
•
In the evaluation of the results of Specialty, Commercial and International, management uses the loss ratio, the expense ratio, the dividend ratio and the combined ratio. These ratios are calculated using financial results prepared in accordance with accounting principles generally accepted in the United States of America. The loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums. The expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums. The dividend ratio is the ratio of policyholders' dividends incurred to net earned premiums. The combined ratio is the sum of the loss, expense and dividend ratios. In addition, management also utilizes renewal premium change, rate, retention and new business in evaluating operating trends. Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes. Rate represents the average change in price on policies that renew excluding exposure change. For certain products within Small Business, where quantifiable, rate includes the influence of new business as well. Exposure represents the measure of risk used in the pricing of the insurance product. Retention represents the percentage of premium dollars renewed in comparison to the expiring premium dollars from policies available to renew. Rate, renewal premium change and retention presented for the prior year is updated to reflect subsequent activity on policies written in the period. New business represents premiums from policies written with new customers and additional policies written with existing customers.
•
This financial supplement may also reference or contain financial measures that are not in accordance with GAAP. Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio. Core income, which is derived from certain income statement amounts, is used by management to monitor performance of the Company's insurance operations. The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk.

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•
Core income (loss) is calculated by excluding from net income (loss) the after-tax effects of net investment gains or losses and any cumulative effects of changes in accounting guidance. The calculation of core income (loss) excludes net investment gains or losses because net investment gains or losses are generally driven by economic factors that are not necessarily reflective of our primary operations. Management monitors core income (loss) for each business segment to assess segment performance. Presentation of consolidated core income (loss) is deemed to be a non-GAAP financial measure. For reconciliations of non-GAAP measures to the most comparable GAAP measures and other information, please refer herein and/or to CNA's most recent 10-K on file with the Securities and Exchange Commission, as well as the press release, available at www.cna.com.
•
Gross written premiums ex. 3rd party captives represents gross written premiums excluding business which is mostly ceded to third party captives, including business related to large warranty programs.
•
Pretax net prior year development and other includes the effects of interest accretion and change in allowance for uncollectible reinsurance and deductible amounts.
•
Net investment income from fixed income securities, as presented, includes both fixed maturity securities and non-redeemable preferred stock.
•
Certain immaterial differences are due to rounding.
•
N/M = Not Meaningful


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