EX-99.2 3 q12024exhibit992.htm EX-99.2 Document


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CNA Financial Corporation
Supplemental Financial Information


March 31, 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

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Statements of Operations
Three months ended March 31
(In millions)20242023Change
Revenues:
Net earned premiums$2,441$2,2489 %
Net investment income60952516 
Net investment (losses) gains(22)(35)
Non-insurance warranty revenue407407
Other revenues97

Total revenues3,444 3,152 9 
Claims, Benefits and Expenses:
Insurance claims and policyholders’ benefits (re-measurement (loss) gain of $(15) and $1)
1,8071,653
Amortization of deferred acquisition costs444379
Non-insurance warranty expense394384
Other operating expenses337337
Interest3528
Total claims, benefits and expenses3,017 2,781 (8)
Income (loss) before income tax427 371 
Income tax (expense) benefit(89)(74)
Net income (loss)$338 $297 14 %


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Components of Income (Loss), Per Share Data and Return on Equity
Three months ended March 31
(In millions, except per share data)20242023
Components of Income (Loss)
Core income (loss)$355 $325 
Net investment gains (losses)(17)(28)
Net income (loss)$338 $297 
Diluted Earnings (Loss) Per Common Share
Core income (loss)$1.30 $1.19 
Net investment gains (losses)(0.06)(0.10)
Diluted earnings (loss) per share$1.24 $1.09 
Weighted Average Outstanding Common Stock and Common Stock Equivalents
Basic271.6 271.3 
Diluted272.7 272.3 
Return on Equity
Net income (loss) (1)
13.8 %13.8 %
Core income (loss) (2)
11.5 10.8 
(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.


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Selected Balance Sheet Data and Statements of Cash Flows Data
(In millions, except per share data)March 31, 2024December 31, 2023
Total investments$46,674 $46,562 
Reinsurance receivables, net of allowance for uncollectible receivables5,574 5,412 
Total assets65,075 64,711 
Insurance reserves44,147 44,196 
Claim and claim adjustment expenses23,588 23,304 
Unearned premiums7,046 6,933 
Future policy benefits13,513 13,959 
Debt3,520 3,031 
Total liabilities55,413 54,818 
Accumulated other comprehensive income (loss) (1)
(2,572)(2,672)
Total stockholders' equity9,662 9,893 
Book value per common share$35.62 $36.52 
Book value per common share excluding AOCI$45.10 $46.39 
Outstanding shares of common stock (in millions of shares)271.3 270.9 
Statutory capital and surplus - Combined Continental Casualty Companies (2)
$10,947 $10,946 
Three Months Ended March 3120242023
Net cash flows provided (used) by operating activities$504 $436 
Net cash flows provided (used) by investing activities(249)51 
Net cash flows provided (used) by financing activities(189)(480)
Net cash flows provided (used) by operating, investing and financing activities$66 $7 
(1) As of March 31, 2024 and December 31, 2023, AOCI included after-tax cumulative impacts of changes in discount rates used to measure long duration contracts of $(18) million and $(359) million.
(2) Statutory capital and surplus as of March 31, 2024 is preliminary.

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Property & Casualty - Results of Operations
Three months ended March 31
(In millions)20242023Change
Gross written premiums$3,742 $3,620 3 %
Gross written premiums ex. 3rd party captives
2,936 2,724 8 
Net written premiums2,390 2,247 6 
Net earned premiums2,331 2,133 9 
Net investment income357 301 19 
Non-insurance warranty revenue407 407 
Other revenues9 7 
Total operating revenues3,104 2,848 9 
Insurance claims and policyholders' benefits1,503 1,349 
Amortization of deferred acquisition costs444 379 
Non-insurance warranty expense394 384 
Other insurance related expenses258 275 
Other expenses29 21 
Total claims, benefits and expenses2,628 2,408 (9)
Core income (loss) before income tax476 440 
Income tax (expense) benefit on core income (loss)(104)(94)
Core income (loss)$372 $346 8 %
Other Performance Metrics
Underwriting gain (loss)$126 $130 (3)%
Loss & LAE ratio64.1 %62.9 %(1.2)pts
Expense ratio30.1 30.7 0.6 
Dividend ratio0.4 0.3 (0.1)
Combined ratio94.6 %93.9 %(0.7)pts
Underlying combined ratio91.0 %90.8 %(0.2)pts
Net accident year catastrophe losses incurred$88 $52 
Effect on loss & LAE ratio3.8 %2.4 %(1.4)pts
Development-related items: (favorable) / unfavorable$(5)$15 
Effect on loss & LAE ratio(0.2)%0.7 %0.9 pts
Rate4 %5 %(1)pts
Renewal premium change6 %7 %(1)pts
Retention85 %86 %(1)pts
New business $529 $503 5 %


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Specialty - Results of Operations
Three months ended March 31
(In millions)20242023Change
Gross written premiums$1,682 $1,780 (6)%
Gross written premiums ex. 3rd party captives
880 886 (1)
Net written premiums792 788 1 
Net earned premiums814 797 2 
Net investment income150 129 16 
Non-insurance warranty revenue407 407 
Other revenues1 — 
Total operating revenues1,372 1,333 3 
Insurance claims and policyholders' benefits479 466 
Amortization of deferred acquisition costs178 165 
Non-insurance warranty expense394 384 
Other insurance related expenses81 86 
Other expenses15 14 
Total claims, benefits and expenses1,147 1,115 (3)
Core income (loss) before income tax225 218 
Income tax (expense) benefit on core income (loss)(48)(47)
Core income (loss)$177 $171 4 %
Other Performance Metrics
Underwriting gain (loss)$76 $80 (5)%
Loss & LAE ratio58.6 %58.4 %(0.2)pts
Expense ratio31.8 31.4 (0.4)
Dividend ratio0.3 0.2 (0.1)
Combined ratio90.7 %90.0 %(0.7)pts
Underlying combined ratio91.3 %90.0 %(1.3)pts
Net accident year catastrophe losses incurred$— $— 
Effect on loss & LAE ratio— %— %— pts
Development-related items: (favorable) / unfavorable$(5)$— 
Effect on loss & LAE ratio(0.6)%— %0.6 pts
Rate2 %2 %— pts
Renewal premium change3 %4 %(1)pts
Retention88 %88 %— pts
New business$94 $108 (13)%

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Commercial - Results of Operations
Three months ended March 31
(In millions)20242023Change
Gross written premiums$1,686 $1,442 17 %
Gross written premiums ex. 3rd party captives
1,682 1,440 17 
Net written premiums1,338 1,188 13 
Net earned premiums1,202 1,046 15 
Net investment income176 149 18 
Other revenues8 7 
Total operating revenues1,386 1,202 15 
Insurance claims and policyholders' benefits835 694 
Amortization of deferred acquisition costs200 169 
Other insurance related expenses138 142 
Other expenses12 6 
Total claims, benefits and expenses1,185 1,011 (17)
Core income (loss) before income tax201 191 
Income tax (expense) benefit on core income (loss)(43)(40)
Core income (loss)$158 $151 5 %
Other Performance Metrics
Underwriting gain (loss)$29 $41 (29)%
Loss & LAE ratio68.8 %65.7 %(3.1)pts
Expense ratio28.2 29.8 1.6 
Dividend ratio0.6 0.5 (0.1)
Combined ratio97.6 %96.0 %(1.6)pts
Underlying combined ratio90.8 %91.8 %1.0 pts
Net accident year catastrophe losses incurred$82 $44 
Effect on loss & LAE ratio6.8 %4.2 %(2.6)pts
Development-related items: (favorable) / unfavorable$— $— 
Effect on loss & LAE ratio— %— %— pts
Rate6 %7 %(1)pts
Renewal premium change8 %9 %(1)pts
Retention85 %86 %(1)pts
New business$367 $310 18 %

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International - Results of Operations
Three months ended March 31
(In millions)20242023Change
Gross written premiums$374 $398 (6)%
Net written premiums260 271 (4)
Net earned premiums315 290 9 
Net investment income31 23 35 
Other revenues— — 
Total operating revenues346 313 11 
Insurance claims and policyholders' benefits189 189 
Amortization of deferred acquisition costs66 45 
Other insurance related expenses39 47 
Other expenses2 1 
Total claims, benefits and expenses296 282 (5)
Core income (loss) before income tax50 31 
Income tax (expense) benefit on core income (loss)(13)(7)
Core income (loss)$37 $24 54 %
Other Performance Metrics
Underwriting gain (loss)$21 $9 133 %
Loss & LAE ratio60.1 %65.4 %5.3 pts
Expense ratio33.2 31.8 (1.4)
Dividend ratio— — — 
Combined ratio93.3 %97.2 %3.9 pts
Underlying combined ratio91.3 %89.3 %(2.0)pts
Net accident year catastrophe losses incurred$6 $8 
Effect on loss & LAE ratio2.0 %2.8 %0.8 pts
Development-related items: (favorable) / unfavorable$— $15 
Effect on loss & LAE ratio— %5.1 %5.1 pts
Rate1 %4 %(3)pts
Renewal premium change3 %8 %(5)pts
Retention82 %83 %(1)pts
New business $68 $85 (20)%

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Life & Group - Results of Operations
Three months ended March 31
(In millions)20242023
Net earned premiums$110 $115 
Net investment income231 214 
Other revenues— — 
Total operating revenues341 329 
Insurance claims and policyholders' benefits312 311 
Other insurance related expenses29 29 
Other expenses— 1 
Total claims, benefits and expenses341 341 
Core income (loss) before income tax— (12)
Income tax (expense) benefit on core income (loss)5 9 
Core income (loss)$5 $(3)

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Corporate & Other - Results of Operations
Three months ended March 31
(In millions)20242023
Net earned premiums$— $— 
Net investment income21 10 
Other revenues— — 
Total operating revenues21 10 
Insurance claims and policyholders' benefits(8)(7)
Other insurance related expenses— 1 
Interest expense34 28 
Other expenses22 10 
Total claims, benefits and expenses48 32 
Core income (loss) before income tax(27)(22)
Income tax (expense) benefit on core income (loss)5 4 
Core income (loss)$(22)$(18)


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Investment Summary - Consolidated
March 31, 2024December 31, 2023
(In millions)Carrying ValueNet Unrealized Gains (Losses)Carrying ValueNet Unrealized Gains (Losses)
Fixed maturity securities:
Corporate and other bonds$24,329 $(889)$24,268 $(748)
States, municipalities and political subdivisions:
Tax-exempt3,4314 3,72288 
Taxable3,857(442)3,670(409)
Total states, municipalities and political subdivisions7,288 (438)7,392 (321)
Asset-backed:
RMBS3,090 (473)3,002 (409)
CMBS1,645 (185)1,631 (223)
Other ABS3,345 (232)3,268 (243)
Total asset-backed8,080 (890)7,901 (875)
U.S. Treasury and obligations of government-sponsored enterprises179 (2)151 (1)
Foreign government729 (34)713 (28)
Redeemable preferred stock— — — — 
Total fixed maturity securities40,605 (2,253)40,425 (1,973)
Equities:
Common stock206 — 191 — 
Non-redeemable preferred stock485 — 492 — 
Total equities691 — 683 — 
Limited partnership investments:
Hedge funds338 — 332 — 
Private equity funds1,936 — 1,842 — 
Total limited partnership investments2,274 — 2,174 — 
Other invested assets79 — 80 — 
Mortgage loans1,029 — 1,035 — 
Short-term investments1,996 — 2,165 1 
Total investments$46,674 $(2,253)$46,562 $(1,972)
Net receivable/(payable) on investment activity$(128)$36 
Effective duration (in years)6.4 6.5 
Weighted average rating (1)
AA
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.

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Investment Summary - Property & Casualty and Corporate & Other
March 31, 2024December 31, 2023
(In millions)Carrying ValueNet Unrealized Gains (Losses)Carrying ValueNet Unrealized Gains (Losses)
Fixed maturity securities:
Corporate and other bonds$14,533 $(750)$14,424 $(756)
States, municipalities and political subdivisions:
Tax-exempt1,074(184)1,160(159)
Taxable2,247(407)2,076(399)
Total states, municipalities and political subdivisions3,321 (591)3,236 (558)
Asset-backed:
RMBS3,088 (473)3,000 (409)
CMBS1,623 (182)1,601 (221)
Other ABS2,766 (145)2,676 (170)
Total asset-backed7,477 (800)7,277 (800)
U.S. Treasury and obligations of government-sponsored enterprises179 (2)150 (1)
Foreign government687 (25)685 (20)
Redeemable preferred stock— — — — 
Total fixed maturity securities26,197 (2,168)25,772 (2,135)
Equities:
Common stock206 — 191 — 
Non-redeemable preferred stock85 — 82 — 
Total equities291 — 273 — 
Limited partnership investments:
Hedge funds187 — 184 — 
Private equity funds1,071 — 1,019 — 
Total limited partnership investments1,258 — 1,203 — 
Other invested assets79 — 80 — 
Mortgage loans838 — 842 — 
Short-term investments1,969 — 2,094 1 
Total investments$30,632 $(2,168)$30,264 $(2,134)
Net receivable/(payable) on investment activity$(128)$33 
Effective duration (in years)4.54.5
Weighted average rating (1)
AA
(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.

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Investment Summary - Life & Group
March 31, 2024December 31, 2023
(In millions)Carrying ValueNet Unrealized Gains (Losses)Carrying ValueNet Unrealized Gains (Losses)
Fixed maturity securities:
Corporate and other bonds$9,796 $(139)$9,844 $8 
States, municipalities and political subdivisions:
Tax-exempt2,3571882,562247
Taxable1,610(35)1,594(10)
Total states, municipalities and political subdivisions3,967 153 4,156 237 
Asset-backed:
RMBS2 — 2 — 
CMBS22 (3)30 (2)
Other ABS579 (87)592 (73)
Total asset-backed603 (90)624 (75)
U.S. Treasury and obligations of government-sponsored enterprises— — 1 — 
Foreign government42 (9)28 (8)
Redeemable preferred stock— — — — 
Total fixed maturity securities14,408 (85)14,653 162 
Equities:
Common stock— — — — 
Non-redeemable preferred stock400 — 410 — 
Total equities400 — 410 — 
Limited partnership investments:
Hedge funds151 — 148 — 
Private equity funds865 — 823 — 
Total limited partnership investments1,016 — 971 — 
Other invested assets— — — — 
Mortgage loans191 — 193 — 
Short-term investments27 — 71 — 
Total investments$16,042 $(85)$16,298 $162 
Net receivable/(payable) on investment activity$— $3 
Effective duration (in years)10.010.2
Weighted average rating (1)
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.

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Investments - Fixed Maturity Securities by Credit Rating
March 31, 2024U.S. Government, Government agencies and Government-sponsored enterprisesAAAAAABBBNon-investment gradeTotal
(In millions)Fair ValueNet Unrealized Gains (Losses)Fair ValueNet Unrealized Gains (Losses)Fair ValueNet Unrealized Gains (Losses)Fair ValueNet Unrealized Gains (Losses)Fair ValueNet Unrealized Gains (Losses)Fair ValueNet Unrealized Gains (Losses)Fair ValueNet Unrealized Gains (Losses)
Corporate and other bonds$— $— $25 $(2)$625 $(32)$7,274 $(197)$14,733 $(618)$1,672 $(40)$24,329 $(889)
States, municipalities and political subdivisions— — 1,152 (39)4,508 (313)1,337 (34)272 (47)19 (5)7,288 (438)
Asset-backed:
RMBS2,683 (353)387 (123)7 — 4 — — — 9 3 3,090 (473)
CMBS— — 632 (21)594 (81)191 (28)188 (33)40 (22)1,645 (185)
Other ABS— — 448 (14)259 (55)1,207 (62)1,251 (88)180 (13)3,345 (232)
Total asset-backed2,683 (353)1,467 (158)860 (136)1,402 (90)1,439 (121)229 (32)8,080 (890)
U.S. Treasury and obligations of government-sponsored enterprises179 (2)— — — — — — — — — — 179 (2)
Foreign government— — 206 (4)391 (15)46 (6)86 (9)— — 729 (34)
Redeemable preferred stock— — — — — — — — — — — — — — 
Total fixed maturity securities$2,862 $(355)$2,850 $(203)$6,384 $(496)$10,059 $(327)$16,530 $(795)$1,920 $(77)$40,605 $(2,253)
Percentage of total fixed maturity securities7 %7 %16 %25 %40 %5 %100 %

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Components of Net Investment Income
Three months ended March 31Consolidated
(In millions)20242023
Taxable fixed income securities$472 $430 
Tax-exempt fixed income securities38 49 
Total fixed income securities 510 479 
Common stock143
Limited partnerships - hedge funds 1214
Limited partnerships - private equity funds 4211
Total limited partnership and common stock investments68 28 
Other, net of investment expense31 18 
Net investment income$609 $525 
Effective income yield for fixed income securities portfolio4.7 %4.6 %
Limited partnership and common stock return2.9 1.3 
Property & Casualty and Corporate & Other
Three months ended March 31
(In millions)20242023
Taxable fixed income securities$291 $261 
Tax-exempt fixed income securities10 11 
Total fixed income securities 301 272 
Common stock143
Limited partnerships - hedge funds78
Limited partnerships - private equity funds236
Total limited partnership and common stock investments44 17 
Other, net of investment expense33 22 
Net investment income$378 $311 
Effective income yield for fixed income securities portfolio4.3 %4.0 %
Three months ended March 31Life & Group
(In millions)20242023
Taxable fixed income securities$181 $169 
Tax-exempt fixed income securities28 38 
Total fixed income securities 209 207 
Common stock— — 
Limited partnerships - hedge funds56 
Limited partnerships - private equity funds195
Total limited partnership and common stock investments24 11 
Other, net of investment expense(2)(4)
Net investment income$231 $214 
Effective income yield for fixed income securities portfolio5.6 %5.5 %

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Net Investment Gains (Losses)
Three months ended March 31Consolidated
(In millions)20242023
Fixed maturity securities:
Corporate and other bonds$(17)$(23)
States, municipalities and political subdivisions— 10 
Asset-backed(15)(9)
Total fixed maturity securities(32)(22)
Non-redeemable preferred stock11 (14)
Derivatives, short-term and other (1)1 
Mortgage loans — — 
Net investment gains (losses)(22)(35)
Income tax benefit (expense) on net investment gains (losses)5 7 
Net investment gains (losses), after tax$(17)$(28)

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Claim & Claim Adjustment Expense Reserve Rollforward
Three months ended March 31, 2024
(In millions)

Specialty
Commercial		InternationalP&C OperationsLife & GroupCorporate & 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 
Ceded1,215 1,082 433 2,730 93 2,318 5,141 
Net5,916 9,021 2,276 17,213 582 368 18,163 
Net incurred claim & claim adjustment expenses477 827 189 1,493 9 4 1,506 
Net claim & claim adjustment expense payments(490)(634)(134)(1,258)(11)(12)(1,281)
Foreign currency translation adjustment and other(1)1 (32)(32)(9)— (41)
Claim & claim adjustment expense reserves, end of period
Net5,902 9,215 2,299 17,416 571 360 18,347 
Ceded1,319 1,117 446 2,882 92 2,267 5,241 
Gross$7,221 $10,332 $2,745 $20,298 $663 $2,627 $23,588 



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Life & Group Policyholder Reserves
March 31, 2024 (In millions)
Claim and claim adjustment expensesFuture policy benefitsTotal
Beginning of Period$582 $13,959 $14,541 
Incurred claims and policyholders' benefits (1)
9306 315 
Benefit and expense payments(11)(321)(332)
Change in discount rate assumptions and other (AOCI)(9)(431)(440)
End of Period$571 $13,513 14,084 
December 31, 2023 (In millions)
Claim and claim adjustment expensesFuture policy benefitsTotal
Beginning of Period$594 $13,480 $14,074 
Incurred claims and policyholders' benefits (1)
29 1,284 1,313 
Benefit and expense payments(50)(1,207)(1,257)
Change in discount rate assumptions and other (AOCI)9402 411 
End of Period$582 $13,959 $14,541 
(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.


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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 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 most recent 10-K on file with the Securities and Exchange Commission, as well as the press release, 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. 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. 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.

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•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


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