Segment Information

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Segment Information

Segment Information

We operate primarily in two industries, property casualty insurance and life insurance. Our chief operating decision maker regularly reviews our reporting segments to make decisions about allocating resources and assessing performance. Our reporting segments are:

• Commercial lines insurance

• Personal lines insurance

• Excess and surplus lines insurance

• Life insurance

• Investments

We report as Other the noninvestment operations of the parent company and its noninsurer subsidiary, CFC Investment Company. We also report as Other the results of our reinsurance assumed operations, known as Cincinnati Re.

Revenues come primarily from unaffiliated customers:

• All four insurance segments record revenues from insurance premiums earned. Life insurance segment revenues also include separate account investment management fees.

• Fee revenues for the commercial and personal insurance segments primarily represent installment fees. Fee revenues for the life insurance segment represent separate account investment management fees.

• Our investments’ revenues consist of pretax net investment income and realized investment gains and losses.

• Other revenues are primarily finance income and, for 2015, earned premiums of Cincinnati Re.

Income or loss before income taxes for each segment is reported based on the nature of that business area’s operations:

• Income before income taxes for the insurance segments is defined as underwriting profit or loss.

◦ For commercial lines, personal lines and excess and surplus lines insurance segments, we calculate underwriting profit or loss as premiums earned and fee revenue minus loss and loss expenses and underwriting expenses incurred.

◦ For the life insurance segment, we calculate underwriting profit or loss as premiums earned and separate account investment management fees, minus contract holders’ benefits and expenses incurred, plus investment interest credited to contract holders.

• Income before income taxes for the investments segment is net investment income plus realized investment gains and losses for investments of the entire company, minus investment interest credited to contract holders of the life insurance segment.

• Loss before income taxes for the Other category is primarily due to interest expense from debt of the parent company, operating expenses of our headquarters and, for 2015, premiums earned minus loss and loss expenses and underwriting expenses of Cincinnati Re.

Identifiable assets are used by each segment in its operations. We do not separately report the identifiable assets for the commercial, personal or excess and surplus lines segments because we do not use that measure to analyze the segments. We include all investment assets, regardless of ownership, in the investments segment.

This table summarizes segment information:

(Dollars in millions)	Years ended December 31,
	2015			2014			2013
Revenues:
Commercial lines insurance
Commercial casualty	$	1,010		$	938		$	856
Commercial property	815			728			623
Commercial auto	561			528			479
Workers' compensation	367			370			365
Other commercial	243			292			313
Commercial lines insurance premiums	2,996			2,856			2,636
Fee revenues	4			4			3
Total commercial lines insurance	3,000			2,860			2,639
Personal lines insurance
Personal auto	506			476			443
Homeowner	463			443			403
Other personal	128			122			115
Personal lines insurance premiums	1,097			1,041			961
Fee revenues	3			2			1
Total personal lines insurance	1,100			1,043			962
Excess and surplus lines insurance	168			148			116
Fee revenues	1			—			—
Total excess and surplus lines insurance	169			148			116
Life insurance premiums	209			198			189
Separate account investment management fees	5			6			4
Total life insurance	214			204			193
Investments
Investment income, net of expenses	572			549			529
Realized investment gains, net	70			133			83
Total investment revenue	642			682			612
Other	17			8			9
Total revenues	$	5,142		$	4,945		$	4,531
Income (loss) before income taxes:
Insurance underwriting results
Commercial lines insurance	$	345		$	146		$	186
Personal lines insurance	(12		)	10			33
Excess and surplus lines insurance	51			30			14
Life insurance	(2		)	(5		)	9
Investments	556			599			532
Other	(57		)	(59		)	(60		)
Total income before income taxes	$	881		$	721		$	714
	December 31,			December 31,
Identifiable assets:	2015			2014
Property casualty insurance	$	2,717		$	2,656
Life insurance	1,325			1,316
Investments	14,485			14,441
Other	361			335
Total	$	18,888		$	18,748