Statutory Accounting Information

12 Months Ended

Dec. 31, 2020

Staturory Accounting Information [Abstract]

Insurance companies’ statutory financial statements are presented on the basis of accounting practices prescribed or permitted by applicable state insurance departments of domicile. Insurance companies use statutory accounting practices (SAP) as recognized by various states. We have adopted the National Association of Insurance Commissioners’ (NAIC) Accounting Practices and Procedures manual, version effective January 1, 2001, and updates through the current year as a component of prescribed or permitted practices by laws of the state of domicile. The primary differences between SAP and GAAP include the valuation of investment gains and losses, expensing of policy acquisition costs, actuarial assumptions for life insurance reserves and deferred income taxes based on differences in statutory and taxable income.

Statutory net income and capital and surplus are determined in accordance with SAP prescribed or permitted by insurance regulatory authorities for five legal entities, our lead insurance subsidiary and its four insurance subsidiaries. Statutory capital and surplus for our insurance subsidiary, The Cincinnati Insurance Company, includes capital and surplus of its four insurance subsidiaries. All capital and surplus amounts exceed statutory risk-based capital requirements. The statutory net income and statutory capital and surplus are presented below:


(Dollars in millions)	Net income						Capital and surplus
	Years ended December 31,						At December 31,
	2020		2019		2018		2020		2019
The Cincinnati Insurance Company	$	466	$	558	$	626	$	5,838	$	5,620
The Cincinnati Casualty Company	14		13		16		456		437
The Cincinnati Indemnity Company	3		3		5		115		111
The Cincinnati Specialty Underwriters Insurance Company	42		62		69		528		526
The Cincinnati Life Insurance Company	27		19		—		241		204