CNA Financial 8K Announces Second Quarter 2024 | CNA 29 Jul 24

CNA Financial Corporation

Supplemental Financial Information

June 30, 2024

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 and Quarterly Reports on Form 10-Q.

Table of Contents

Statements of Operations


Periods ended June 30	Three Months						Six Months
(In millions)	2024		2023		Change		2024		2023		Change
Revenues:
Net earned premiums	$	2,498	$	2,347	6	%	$	4,939	$	4,595	7	%
Net investment income	618		575		7		1,227		1,100		12
Net investment (losses) gains	(10)		(32)				(32)		(67)
Non-insurance warranty revenue	404		407				811		814
Other revenues	9		7				18		14
Total revenues	3,519		3,304		7		6,963		6,456		8
Claims, Benefits and Expenses:
Insurance claims and policyholders’ benefits (re-measurement loss of $(25), $(33), $(40) and $(34))	1,882		1,779				3,689		3,432
Amortization of deferred acquisition costs	435		403				879		782
Non-insurance warranty expense	388		384				782		768
Other operating expenses	378		346				715		683
Interest	34		31				69		59
Total claims, benefits and expenses	3,117		2,943		(6)		6,134		5,724		(7)
Income (loss) before income tax	402		361				829		732
Income tax (expense) benefit	(85)		(78)				(174)		(152)
Net income (loss)	$	317	$	283	12	%	$	655	$	580	13	%

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)	2024			2023			2024			2023
Components of Income (Loss)
Core income (loss)	$	326		$	308		$	681		$	633
Net investment gains (losses)	(9)			(25)			(26)			(53)
Net income (loss)	$	317		$	283		$	655		$	580

Diluted Earnings (Loss) Per Common Share
Core income (loss)	$	1.19		$	1.13		$	2.50		$	2.33
Net investment gains (losses)	(0.02)			(0.09)			(0.10)			(0.20)
Diluted earnings (loss) per share	$	1.17		$	1.04		$	2.40		$	2.13

Weighted Average Outstanding Common Stock and Common Stock Equivalents
Basic	271.6			271.2			271.6			271.2
Diluted	272.6			272.0			272.6			272.1

Return on Equity
Net income (loss) (1)	13.0		%	13.0		%	13.3		%	13.4		%
Core income (loss) (2)	10.6			10.2			10.9			10.4

(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.

Selected Balance Sheet Data and Statements of Cash Flows Data


(In millions, except per share data)	June 30, 2024		December 31, 2023
Total investments	$	46,245	$	46,562
Reinsurance receivables, net of allowance for uncollectible receivables	5,652		5,412
Total assets	65,194		64,711
Insurance reserves	44,594		44,196
Claim and claim adjustment expenses	23,974		23,304
Unearned premiums	7,409		6,933
Future policy benefits	13,211		13,959
Debt	2,971		3,031
Total liabilities	55,320		54,818
Accumulated other comprehensive income (loss) (1)	(2,547)		(2,672)
Total stockholders' equity	9,874		9,893

Book value per common share	$	36.46	$	36.52
Book value per common share excluding AOCI	$	45.86	$	46.39

Outstanding shares of common stock (in millions of shares)	270.8		270.9

Statutory capital and surplus - Combined Continental Casualty Companies (2)	$	11,031	$	10,946


Three Months Ended June 30	2024		2023
Net cash flows provided (used) by operating activities	$	616	$	501
Net cash flows provided (used) by investing activities	40		(909)
Net cash flows provided (used) by financing activities	(689)		280
Net cash flows provided (used) by operating, investing and financing activities	$	(33)	$	(128)


Six Months Ended June 30	2024		2023
Net cash flows provided (used) by operating activities	$	1,120	$	937
Net cash flows provided (used) by investing activities	(209)		(858)
Net cash flows provided (used) by financing activities	(878)		(200)
Net cash flows provided (used) by operating, investing and financing activities	$	33	$	(121)

(1) As of June 30, 2024 and December 31, 2023, AOCI included after-tax cumulative impacts of changes in discount rates used to measure long duration contracts of $255 million and $(359) million.

(2) Statutory capital and surplus as of June 30, 2024 is preliminary.

Property & Casualty - Results of Operations


Periods ended June 30	Three Months								Six Months
(In millions)	2024			2023			Change		2024			2023			Change
Gross written premiums	$	4,072		$	3,909		4	%	$	7,814		$	7,529		4	%
Gross written premiums ex. 3rd party captives	3,203			2,986			7		6,139			5,710			8
Net written premiums	2,674			2,513			6		5,064			4,760			6

Net earned premiums	2,389			2,234			7		4,720			4,367			8
Net investment income	361			332			9		718			633			13
Non-insurance warranty revenue	404			407					811			814
Other revenues	9			7					18			14
Total operating revenues	3,163			2,980			6		6,267			5,828			8
Insurance claims and policyholders' benefits	1,530			1,406					3,033			2,755
Amortization of deferred acquisition costs	435			403					879			782
Non-insurance warranty expense	388			384					782			768
Other insurance related expenses	300			287					558			562
Other expenses	27			17					56			38
Total claims, benefits and expenses	2,680			2,497			(7)		5,308			4,905			(8)
Core income (loss) before income tax	483			483					959			923
Income tax (expense) benefit on core income (loss)	(103)			(109)					(207)			(203)
Core income (loss)	$	380		$	374		2	%	$	752		$	720		4	%

Other Performance Metrics
Underwriting gain (loss)	$	124		$	138		(10)	%	$	250		$	268		(7)	%

Loss & LAE ratio	63.8		%	62.6		%	(1.2)	pts	63.9		%	62.8		%	(1.1)	pts
Expense ratio	30.7			30.9			0.2		30.4			30.8			0.4
Dividend ratio	0.3			0.3			—		0.4			0.3			(0.1)
Combined ratio	94.8		%	93.8		%	(1.0)	pts	94.7		%	93.9		%	(0.8)	pts
Underlying combined ratio	91.6		%	91.1		%	(0.5)	pts	91.4		%	91.0		%	(0.4)	pts

Net accident year catastrophe losses incurred	$	82		$	68				$	170		$	120
Effect on loss & LAE ratio	3.5		%	3.1		%	(0.4)	pts	3.6		%	2.7		%	(0.9)	pts

Development-related items: (favorable) / unfavorable	$	(6)		$	(6)				$	(11)		$	9
Effect on loss & LAE ratio	(0.3)		%	(0.4)		%	(0.1)	pts	(0.3)		%	0.2		%	0.5	pts

Rate	4		%	5		%	(1)	pts	4		%	5		%	(1)	pts
Renewal premium change	5		%	7		%	(2)	pts	5		%	7		%	(2)	pts
Retention	85		%	86		%	(1)	pts	85		%	86		%	(1)	pts
New business	$	595		$	555		7	%	$	1,124		$	1,058		6	%

Specialty - Results of Operations


Periods ended June 30	Three Months								Six Months
(In millions)	2024			2023			Change		2024			2023			Change
Gross written premiums	$	1,728		$	1,769		(2)	%	$	3,410		$	3,549		(4)	%
Gross written premiums ex. 3rd party captives	984			961			2		1,864			1,847			1
Net written premiums	857			825			4		1,649			1,613			2

Net earned premiums	831			812			2		1,645			1,609			2
Net investment income	154			142			8		304			271			12
Non-insurance warranty revenue	404			407					811			814
Other revenues	(1)			—					—			—
Total operating revenues	1,388			1,361			2		2,760			2,694			2
Insurance claims and policyholders' benefits	495			476					974			942
Amortization of deferred acquisition costs	180			168					358			333
Non-insurance warranty expense	388			384					782			768
Other insurance related expenses	96			94					177			180
Other expenses	13			12					28			26
Total claims, benefits and expenses	1,172			1,134			(3)		2,319			2,249			(3)
Core income (loss) before income tax	216			227					441			445
Income tax (expense) benefit on core income (loss)	(47)			(50)					(95)			(97)
Core income (loss)	$	169		$	177		(5)	%	$	346		$	348		(1)	%

Other Performance Metrics
Underwriting gain (loss)	$	60		$	74		(19)	%	$	136		$	154		(12)	%

Loss & LAE ratio	59.2		%	58.3		%	(0.9)	pts	58.9		%	58.3		%	(0.6)	pts
Expense ratio	33.2			32.4			(0.8)		32.5			31.9			(0.6)
Dividend ratio	0.3			0.2			(0.1)		0.3			0.2			(0.1)
Combined ratio	92.7		%	90.9		%	(1.8)	pts	91.7		%	90.4		%	(1.3)	pts
Underlying combined ratio	93.1		%	91.2		%	(1.9)	pts	92.2		%	90.6		%	(1.6)	pts

Net accident year catastrophe losses incurred	$	—		$	—				$	—		$	—
Effect on loss & LAE ratio	—		%	—		%	—	pts	—		%	—		%	—	pts

Development-related items: (favorable) / unfavorable	$	(3)		$	(2)				$	(8)		$	(2)
Effect on loss & LAE ratio	(0.4)		%	(0.3)		%	0.1	pts	(0.5)		%	(0.2)		%	0.3	pts

Rate	—		%	(1)		%	1	pts	1		%	—		%	1	pts
Renewal premium change	1		%	—		%	1	pts	2		%	2		%	—	pts
Retention	90		%	89		%	1	pts	89		%	89		%	—	pts
New business	$	118		$	120		(2)	%	$	212		$	228		(7)	%

Commercial - Results of Operations


Periods ended June 30	Three Months								Six Months
(In millions)	2024			2023			Change		2024			2023			Change
Gross written premiums	$	1,927		$	1,719		12	%	$	3,613		$	3,161		14	%
Gross written premiums ex. 3rd party captives	1,802			1,604			12		3,484			3,044			14
Net written premiums	1,458			1,329			10		2,796			2,517			11

Net earned premiums	1,247			1,120			11		2,449			2,166			13
Net investment income	175			165			6		351			314			12
Other revenues	10			6					18			13
Total operating revenues	1,432			1,291			11		2,818			2,493			13
Insurance claims and policyholders' benefits	851			745					1,686			1,439
Amortization of deferred acquisition costs	199			175					399			344
Other insurance related expenses	158			158					296			300
Other expenses	13			10					25			16
Total claims, benefits and expenses	1,221			1,088			(12)		2,406			2,099			(15)
Core income (loss) before income tax	211			203					412			394
Income tax (expense) benefit on core income (loss)	(44)			(44)					(87)			(84)
Core income (loss)	$	167		$	159		5	%	$	325		$	310		5	%

Other Performance Metrics
Underwriting gain (loss)	$	39		$	42		(7)	%	$	68		$	83		(18)	%

Loss & LAE ratio	68.0		%	66.2		%	(1.8)	pts	68.4		%	65.9		%	(2.5)	pts
Expense ratio	28.5			29.6			1.1		28.4			29.8			1.4
Dividend ratio	0.5			0.5			—		0.5			0.5			—
Combined ratio	97.0		%	96.3		%	(0.7)	pts	97.3		%	96.2		%	(1.1)	pts
Underlying combined ratio	91.0		%	91.6		%	0.6	pts	90.9		%	91.8		%	0.9	pts

Net accident year catastrophe losses incurred	$	76		$	59				$	158		$	103
Effect on loss & LAE ratio	6.1		%	5.2		%	(0.9)	pts	6.4		%	4.7		%	(1.7)	pts

Development-related items: (favorable) / unfavorable	$	—		$	(4)				$	—		$	(4)
Effect on loss & LAE ratio	(0.1)		%	(0.5)		%	(0.4)	pts	—		%	(0.3)		%	(0.3)	pts

Rate	7		%	8		%	(1)	pts	7		%	8		%	(1)	pts
Renewal premium change	7		%	11		%	(4)	pts	8		%	10		%	(2)	pts
Retention	84		%	85		%	(1)	pts	84		%	85		%	(1)	pts
New business	$	405		$	343		18	%	$	772		$	653		18	%

International - Results of Operations


Periods ended June 30	Three Months								Six Months
(In millions)	2024			2023			Change		2024			2023			Change
Gross written premiums	$	417		$	421		(1)	%	$	791		$	819		(3)	%
Net written premiums	359			359			—		619			630			(2)
Net earned premiums	311			302			3		626			592			6
Net investment income	32			25			28		63			48			31
Other revenues	—			1					—			1
Total operating revenues	343			328			5		689			641			7
Insurance claims and policyholders' benefits	184			185					373			374
Amortization of deferred acquisition costs	56			60					122			105
Other insurance related expenses	46			35					85			82
Other expenses	1			(5)					3			(4)
Total claims, benefits and expenses	287			275			(4)		583			557			(5)
Core income (loss) before income tax	56			53					106			84
Income tax (expense) benefit on core income (loss)	(12)			(15)					(25)			(22)
Core income (loss)	$	44		$	38		16	%	$	81		$	62		31	%

Other Performance Metrics
Underwriting gain (loss)	$	25		$	22		14	%	$	46		$	31		48	%

Loss & LAE ratio	59.1		%	61.0		%	1.9	pts	59.6		%	63.1		%	3.5	pts
Expense ratio	32.8			31.2			(1.6)		33.0			31.5			(1.5)
Dividend ratio	—			—			—		—			—			—
Combined ratio	91.9		%	92.2		%	0.3	pts	92.6		%	94.6		%	2.0	pts
Underlying combined ratio	90.9		%	89.1		%	(1.8)	pts	91.1		%	89.2		%	(1.9)	pts

Net accident year catastrophe losses incurred	$	6		$	9				$	12		$	17
Effect on loss & LAE ratio	2.0		%	3.1		%	1.1	pts	2.0		%	2.9		%	0.9	pts

Development-related items: (favorable) / unfavorable	$	(3)		$	—				$	(3)		$	15
Effect on loss & LAE ratio	(1.0)		%	—		%	1.0	pts	(0.5)		%	2.5		%	3.0	pts

Rate	—		%	4		%	(4)	pts	—		%	4		%	(4)	pts
Renewal premium change	2		%	7		%	(5)	pts	3		%	7		%	(4)	pts
Retention	80		%	83		%	(3)	pts	81		%	83		%	(2)	pts
New business	$	72		$	92		(22)	%	$	140		$	177		(21)	%

Life & Group - Results of Operations


Periods ended June 30	Three Months				Six Months
(In millions)	2024		2023		2024		2023
Net earned premiums	$	109	$	113	$	219	$	228
Net investment income	239		229		470		443
Other revenues	—		—		—		—
Total operating revenues	348		342		689		671
Insurance claims and policyholders' benefits	325		344		637		655
Other insurance related expenses	29		31		58		60
Other expenses	1		—		1		1
Total claims, benefits and expenses	355		375		696		716
Core income (loss) before income tax	(7)		(33)		(7)		(45)
Income tax (expense) benefit on core income (loss)	6		13		11		22
Core income (loss)	$	(1)	$	(20)	$	4	$	(23)

Corporate & Other - Results of Operations


Periods ended June 30	Three Months				Six Months
(In millions)	2024		2023		2024		2023
Net earned premiums	$	—	$	—	$	—	$	—
Net investment income	18		14		39		24
Other revenues	—		—		—		—
Total operating revenues	18		14		39		24
Insurance claims and policyholders' benefits	27		29		19		22
Other insurance related expenses	—		—		—		1
Interest expense	35		30		69		58
Other expenses	20		12		42		22

Total claims, benefits and expenses	82		71		130		103
Core income (loss) before income tax	(64)		(57)		(91)		(79)
Income tax (expense) benefit on core income (loss)	11		11		16		15
Core income (loss)	$	(53)	$	(46)	$	(75)	$	(64)

Investment Summary - Consolidated


	June 30, 2024				March 31, 2024				December 31, 2023
(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	$	24,372	$	(1,095)	$	24,329	$	(889)	$	24,268	$	(748)
States, municipalities and political subdivisions:
Tax-exempt	3,333		(33)		3,431		4		3,722		88
Taxable	3,696		(498)		3,857		(442)		3,670		(409)
Total states, municipalities and political subdivisions	7,029		(531)		7,288		(438)		7,392		(321)
Asset-backed:
RMBS	3,115		(487)		3,090		(473)		3,002		(409)
CMBS	1,611		(179)		1,645		(185)		1,631		(223)
Other ABS	3,379		(243)		3,345		(232)		3,268		(243)
Total asset-backed	8,105		(909)		8,080		(890)		7,901		(875)
U.S. Treasury and obligations of government-sponsored enterprises	191		(2)		179		(2)		151		(1)
Foreign government	706		(36)		729		(34)		713		(28)
Redeemable preferred stock	—		—		—		—		—		—
Total fixed maturity securities	40,403		(2,573)		40,605		(2,253)		40,425		(1,973)
Equities:
Common stock	180		—		206		—		191		—
Non-redeemable preferred stock	489		—		485		—		492		—
Total equities	669		—		691		—		683		—
Limited partnership investments:
Hedge funds	347		—		338		—		332		—
Private equity funds	2,020		—		1,936		—		1,842		—
Total limited partnership investments	2,367		—		2,274		—		2,174		—
Other invested assets	73		—		79		—		80		—
Mortgage loans	986		—		1,029		—		1,035		—
Short-term investments	1,747		—		1,996		—		2,165		1
Total investments	$	46,245	$	(2,573)	$	46,674	$	(2,253)	$	46,562	$	(1,972)

Net receivable/(payable) on investment activity	$	(6)			$	(128)			$	36

Effective duration (in years)	6.4				6.4				6.5
Weighted average rating (1)	A				A				A

RMBS - Residential mortgage-backed securities

CMBS - Commercial mortgage-backed securities

Other ABS - Other asset-backed securities

(1) Obligations of the U.S. Government, U.S. Government agencies and U.S. Government-sponsored enterprises were classified as AAA for purposes of calculating the weighted average rating.

Investment Summary - Property & Casualty and Corporate & Other


	June 30, 2024				March 31, 2024				December 31, 2023
(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	$	14,311	$	(779)	$	14,533	$	(750)	$	14,424	$	(756)
States, municipalities and political subdivisions:
Tax-exempt	1,008		(190)		1,074		(184)		1,160		(159)
Taxable	2,133		(428)		2,247		(407)		2,076		(399)
Total states, municipalities and political subdivisions	3,141		(618)		3,321		(591)		3,236		(558)
Asset-backed:
RMBS	3,113		(487)		3,088		(473)		3,000		(409)
CMBS	1,588		(177)		1,623		(182)		1,601		(221)
Other ABS	2,813		(140)		2,766		(145)		2,676		(170)
Total asset-backed	7,514		(804)		7,477		(800)		7,277		(800)
U.S. Treasury and obligations of government-sponsored enterprises	191		(2)		179		(2)		150		(1)
Foreign government	660		(26)		687		(25)		685		(20)
Redeemable preferred stock	—		—		—		—		—		—
Total fixed maturity securities	25,817		(2,229)		26,197		(2,168)		25,772		(2,135)
Equities:
Common stock	180		—		206		—		191		—
Non-redeemable preferred stock	82		—		85		—		82		—
Total equities	262		—		291		—		273		—
Limited partnership investments:
Hedge funds	265		—		187		—		184		—
Private equity funds	1,545		—		1,071		—		1,019		—
Total limited partnership investments	1,810		—		1,258		—		1,203		—
Other invested assets	73		—		79		—		80		—
Mortgage loans	796		—		838		—		842		—
Short-term investments	1,698		—		1,969		—		2,094		1
Total investments	$	30,456	$	(2,229)	$	30,632	$	(2,168)	$	30,264	$	(2,134)

Net receivable/(payable) on investment activity	$	(19)			$	(128)			$	33

Effective duration (in years)	4.4				4.5				4.5
Weighted average rating (1)	A				A				A

(1) Obligations of the U.S. Government, U.S. Government agencies and U.S. Government-sponsored enterprises were classified as AAA for purposes of calculating the weighted average rating.

Investment Summary - Life & Group


	June 30, 2024				March 31, 2024				December 31, 2023
(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	$	10,061	$	(316)	$	9,796	$	(139)	$	9,844	$	8
States, municipalities and political subdivisions:
Tax-exempt	2,325		157		2,357		188		2,562		247
Taxable	1,563		(70)		1,610		(35)		1,594		(10)
Total states, municipalities and political subdivisions	3,888		87		3,967		153		4,156		237
Asset-backed:
RMBS	2		—		2		—		2		—
CMBS	23		(2)		22		(3)		30		(2)
Other ABS	566		(103)		579		(87)		592		(73)
Total asset-backed	591		(105)		603		(90)		624		(75)
U.S. Treasury and obligations of government-sponsored enterprises	—		—		—		—		1		—
Foreign government	46		(10)		42		(9)		28		(8)
Redeemable preferred stock	—		—		—		—		—		—
Total fixed maturity securities	14,586		(344)		14,408		(85)		14,653		162
Equities:
Common stock	—		—		—		—		—		—
Non-redeemable preferred stock	407		—		400		—		410		—
Total equities	407		—		400		—		410		—
Limited partnership investments:
Hedge funds	82		—		151		—		148		—
Private equity funds	475		—		865		—		823		—
Total limited partnership investments	557		—		1,016		—		971		—
Other invested assets	—		—		—		—		—		—
Mortgage loans	190		—		191		—		193		—
Short-term investments	49		—		27		—		71		—
Total investments	$	15,789	$	(344)	$	16,042	$	(85)	$	16,298	$	162

Net receivable/(payable) on investment activity	$	13			$	—			$	3

Effective duration (in years)	9.9				10.0				10.2
Weighted average rating (1)	A-				A-				A-

(1) Obligations of the U.S. Government, U.S. Government agencies and U.S. Government-sponsored enterprises were classified as AAA for purposes of calculating the weighted average rating.

Investments - Fixed Maturity Securities by Credit Rating


June 30, 2024	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	$	—		$	—	$	27		$	(3)	$	723		$	(34)	$	7,403		$	(281)	$	14,561		$	(715)	$	1,658		$	(62)	$	24,372		$	(1,095)
States, municipalities and political subdivisions	—			—		1,136			(59)		4,351			(369)		1,264			(51)		259			(47)		19			(5)		7,029			(531)
Asset-backed:
RMBS	2,650			(372)		447			(118)		8			—		1			—		—			—		9			3		3,115			(487)
CMBS	—			—		617			(23)		596			(78)		177			(25)		164			(27)		57			(26)		1,611			(179)
Other ABS	—			—		453			(18)		268			(62)		1,243			(62)		1,245			(86)		170			(15)		3,379			(243)
Total asset-backed	2,650			(372)		1,517			(159)		872			(140)		1,421			(87)		1,409			(113)		236			(38)		8,105			(909)
U.S. Treasury and obligations of government-sponsored enterprises	191			(2)		—			—		—			—		—			—		—			—		—			—		191			(2)
Foreign government	—			—		206			(4)		377			(16)		38			(7)		85			(9)		—			—		706			(36)
Redeemable preferred stock	—			—		—			—		—			—		—			—		—			—		—			—		—			—
Total fixed maturity securities	$	2,841		$	(374)	$	2,886		$	(225)	$	6,323		$	(559)	$	10,126		$	(426)	$	16,314		$	(884)	$	1,913		$	(105)	$	40,403		$	(2,573)

Percentage of total fixed maturity securities	7		%			7		%			16		%			25		%			40		%			5		%			100		%

Components of Net Investment Income


Periods ended June 30	Consolidated
	Three Months						Six Months
(In millions)	2024			2023			2024			2023
Taxable fixed income securities	$	484		$	444		$	956		$	874
Tax-exempt fixed income securities	36			46			74			95
Total fixed income securities	520			490			1,030			969
Common stock	4			13			18			16
Limited partnerships - hedge funds	10			7			22			21
Limited partnerships - private equity funds	64			48			106			59
Total limited partnership and common stock investments	78			68			146			96
Other, net of investment expense	20			17			51			35
Net investment income	$	618		$	575		$	1,227		$	1,100

Effective income yield for fixed income securities portfolio	4.8		%	4.6		%	4.8		%	4.6		%
Limited partnership and common stock return	3.1			3.1			6.1			4.5


	Property & Casualty and Corporate & Other
Periods ended June 30
	Three Months						Six Months
(In millions)	2024			2023			2024			2023
Taxable fixed income securities	$	301		$	272		$	592		$	533
Tax-exempt fixed income securities	9			11			19			22
Total fixed income securities	310			283			611			555
Common stock	4			13			18			16
Limited partnerships - hedge funds	5			3			12			11
Limited partnerships - private equity funds	36			27			59			33
Total limited partnership and common stock investments	45			43			89			60
Other, net of investment expense	24			20			57			42
Net investment income	$	379		$	346		$	757		$	657

Effective income yield for fixed income securities portfolio	4.4		%	4.2		%	4.3		%	4.1		%


Periods ended June 30	Life & Group
	Three Months						Six Months
(In millions)	2024			2023			2024			2023
Taxable fixed income securities	$	183		$	172		$	364		$	341
Tax-exempt fixed income securities	27			35			55			73
Total fixed income securities	210			207			419			414
Common stock	—			—			—			—
Limited partnerships - hedge funds	5			4			10			10
Limited partnerships - private equity funds	28			21			47			26
Total limited partnership and common stock investments	33			25			57			36
Other, net of investment expense	(4)			(3)			(6)			(7)
Net investment income	$	239		$	229		$	470		$	443

Effective income yield for fixed income securities portfolio	5.6		%	5.5		%	5.6		%	5.5		%

Net Investment Gains (Losses)


Periods ended June 30	Consolidated
	Three Months				Six Months
(In millions)	2024		2023		2024		2023
Fixed maturity securities:
Corporate and other bonds	$	(4)	$	(12)	$	(21)	$	(35)
States, municipalities and political subdivisions	(2)		(3)		(2)		7
Asset-backed	(6)		(12)		(21)		(21)
Total fixed maturity securities	(12)		(27)		(44)		(49)
Non-redeemable preferred stock	1		3		12		(11)
Derivatives, short-term and other	1		(2)		—		(1)
Mortgage loans	—		(6)		—		(6)
Net investment gains (losses)	(10)		(32)		(32)		(67)
Income tax benefit (expense) on net investment gains (losses)	1		7		6		14
Net investment gains (losses), after tax	$	(9)	$	(25)	$	(26)	$	(53)

Claim & Claim Adjustment Expense Reserve Rollforward


Three months ended June 30, 2024 (In millions)	Specialty		Commercial		International		P&C Operations		Life & Group		Corporate & Other		Total Operations
Claim & claim adjustment expense reserves, beginning of period
Gross	$	7,221	$	10,332	$	2,745	$	20,298	$	663	$	2,627	$	23,588
Ceded	1,319		1,117		446		2,882		92		2,267		5,241
Net	5,902		9,215		2,299		17,416		571		360		18,347

Net incurred claim & claim adjustment expenses	492		847		184		1,523		9		40		1,572
Net claim & claim adjustment expense payments	(482)		(629)		(135)		(1,246)		(11)		(29)		(1,286)
Foreign currency translation adjustment and other	—		—		(8)		(8)		(8)		(1)		(17)

Claim & claim adjustment expense reserves, end of period
Net	5,912		9,433		2,340		17,685		561		370		18,616
Ceded	1,407		1,184		443		3,034		90		2,234		5,358
Gross	$	7,319	$	10,617	$	2,783	$	20,719	$	651	$	2,604	$	23,974


Six months ended June 30, 2024 (In millions)	Specialty		Commercial		International		P&C Operations		Life & Group		Corporate & Other		Total Operations
Claim & claim adjustment expense reserves, beginning of period
Gross	$	7,131	$	10,103	$	2,709	$	19,943	$	675	$	2,686	$	23,304
Ceded	1,215		1,082		433		2,730		93		2,318		5,141
Net	5,916		9,021		2,276		17,213		582		368		18,163

Net incurred claim & claim adjustment expenses	969		1,674		373		3,016		18		44		3,078
Net claim & claim adjustment expense payments	(972)		(1,263)		(269)		(2,504)		(22)		(41)		(2,567)
Foreign currency translation adjustment and other	(1)		1		(40)		(40)		(17)		(1)		(58)

Claim & claim adjustment expense reserves, end of period
Net	5,912		9,433		2,340		17,685		561		370		18,616
Ceded	1,407		1,184		443		3,034		90		2,234		5,358
Gross	$	7,319	$	10,617	$	2,783	$	20,719	$	651	$	2,604	$	23,974

Life & Group Policyholder Reserves



Three months ended June 30, 2024 (In millions)	Claim and claim adjustment expenses		Future policy benefits		Total
Beginning of Period	$	571	$	13,513	$	14,084

Incurred claims and policyholders' benefits (1)	9		315		324
Benefit and expense payments	(11)		(271)		(282)
Change in discount rate assumptions and other (AOCI)	(8)		(346)		(354)

End of Period	$	561	$	13,211	13,772



Six months ended June 30, 2024 (In millions)	Claim and claim adjustment expenses		Future policy benefits		Total
Beginning of Period	$	582	$	13,959	$	14,541

Incurred claims and policyholders' benefits (1)	18		621		639
Benefit and expense payments	(22)		(592)		(614)
Change in discount rate assumptions and other (AOCI)	(17)		(777)		(794)

End of Period	$	561	$	13,211	$	13,772

(1) Incurred claims and policyholders' benefits above does not agree to Net incurred claims and benefits as reflected in Note J to the Condensed Consolidated Financial Statements included under Part I, Item 1 of the Quarterly Report on Form 10-Q due to the timing of benefit and expense cash flows in determining Future Policy Benefit reserves, along with the allowable expenses in the reserve.

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 includes the individual and group run-off long-term care businesses as well as structured settlement obligations not funded by annuities related to certain property and casualty claimants.

•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, asbestos and environmental pollution (A&EP), a legacy portfolio of excess workers' compensation (EWC) policies and certain legacy mass tort reserves.

•Management uses the core income (loss) financial measure to monitor the Company’s operations for the Specialty, Commercial and International segments. Core income (loss) is calculated by excluding from net income (loss) the after-tax effects of net investment gains or losses. 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 and management believes some investors may find this measure useful to evaluate the Company's primary operations. Please refer to Note P to the Consolidated Financial Statements within the December 31, 2023 Form 10-K for further discussion regarding how the Company manages its business.

•This financial supplement may also reference or contain financial measures utilized to monitor the Company's investment portfolio that are not in accordance with GAAP. 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.

•For reconciliations of non-GAAP measures to the most comparable GAAP measures and other information, please refer herein and/or to CNA's filings with the Securities and Exchange Commission, available at www.cna.com.

•In evaluating the results of the Specialty, Commercial and International segments, management uses the loss ratio, the underlying loss ratio, the expense ratio, the dividend ratio, the combined ratio and the underlying 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 underlying loss ratio excludes the impact of catastrophe losses and development-related items from the loss ratio. Development-related items represents net prior year loss reserve and premium development, and includes the effects of interest accretion and change in allowance for uncollectible reinsurance and deductible amounts. 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. The underlying combined ratio is the sum of the underlying loss ratio, the expense ratio and the dividend ratio. 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. Exposure represents the measure of risk used in the pricing of the insurance product. The change in exposure represents the change in premium dollars on policies that renew as a result of the change in risk of the policy. Retention represents the percentage of premium dollars renewed, excluding rate and exposure changes, 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.

•Management uses underwriting gain (loss), calculated using GAAP financial results, to monitor insurance operations of our Specialty, Commercial and International segments. Underwriting gain (loss) is pretax and 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.

•Gross written premiums ex. 3rd party captives represents gross written premiums excluding business which is ceded to third party captives, including business related to large warranty programs.

•Statutory capital and surplus represents the excess of an insurance company's admitted assets over its liabilities, including loss reserves, as determined in accordance with statutory accounting practices.

•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

CNA Financial (CNA) 8-KCna Financial Announces Second Quarter 2024