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0000906318-07-000015.txt : 20070207 0000906318-07-000015.hdr.sgml : 20070207 20070207091607 ACCESSION NUMBER: 0000906318-07-000015 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20070205 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Regulation FD Disclosure ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20070207 DATE AS OF CHANGE: 20070207 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CINCINNATI FINANCIAL CORP CENTRAL INDEX KEY: 0000020286 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 310746871 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-04604 FILM NUMBER: 07586326 BUSINESS ADDRESS: STREET 1: 6200 S GILMORE RD CITY: FAIRFIELD STATE: OH ZIP: 45014 BUSINESS PHONE: 5138702000 MAIL ADDRESS: STREET 1: P.O. BOX 145496 CITY: CINCINNATI STATE: OH ZIP: 45250 8-K 1 cinfin8k2507.htm FORM 8-K .


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: February 5, 2007 (Date of earliest event reported)

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

Ohio	0-4604	31-0746871
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

6200 S. Gilmore Road, Fairfield, Ohio		45014-5141
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (513) 870-2000

N/A (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:


¨	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 240.13a-4(c))

Item 2.02 Results of Operations and Financial Condition.

On February 7, 2007, Cincinnati Financial Corporation issued the attached news release titled “Cincinnati Financial 2006 Net Income at $5.30 per Share and Operating Income* at $2.82,” furnished as Exhibit 99.1 hereto and incorporated herein by reference. On February 7, 2007, the company also distributed the attached information titled “Supplemental Financial Data,” furnished as Exhibit 99.2 hereto and incorporated herein by reference. This report should not be deemed an admission as to the materiality of any information contained in the news release or supplemental financial data.

In accordance with general instruction B.2 of Form 8-K, the information furnished in this report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Item 7.01 Regulation FD Disclosure.

On February 5, 2007, Cincinnati Financial Corporation issued the attached news release “Cincinnati Financial Corporation Increases Cash Dividend and Announces Board Actions.” The news release is furnished as Exhibit 99.3 hereto and is incorporated herein by reference. This report should not be deemed an admission as to the materiality of any information contained in the news release.

On February 5, 2007, Cincinnati Financial Corporation issued the attached news release “Cincinnati Financial Corporation's Subsidiaries Announce Appointments.” The news release is furnished as Exhibit 99.4 hereto and is incorporated herein by reference. This report should not be deemed an admission as to the materiality of any information contained in the news release.

The information furnished in Item 7.01 of this report shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, nor shall such information be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended.

Item 9.01 Financial Statements and Exhibits.

(c)

Exhibits

Exhibit 99.1 – News release dated February 7, 2007, “Cincinnati Financial 2006 Net Income at $5.30 per Share and Operating Income* at $2.82”

Exhibit 99.2 – Supplemental Financial Data dated February 7, 2007

Exhibit 99.3 – News release dated February 5, 2007, titled “Cincinnati Financial Corporation Increases Cash Dividend and Announces Board Actions”

Exhibit 99.4 – News release dated February 5, 2007, titled “Cincinnati Financial Corporation's Subsidiaries Announce Appointments”

Signature

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.


	CINCINNATI FINANCIAL CORPORATION



Date: February 7, 2007	/s/ Kenneth W. Stecher
	Kenneth W. Stecher
	Chief Financial Officer, Executive Vice President, Secretary and Treasurer
	(Principal Accounting Officer)

EX-99 2 ex991.htm EXHIBIT 99.1 Converted by EDGARwiz

CINCINNATI FINANCIAL CORPORATION

Mailing Address: P.O. BOX 145496

CINCINNATI, OHIO 45250-5496

(513) 870-2000

Investor Contact: Heather J. Wietzel

513-870-2768

Media Contact: Joan O. Shevchik

513-603-5323

Cincinnati Financial 2006 Net Income at $5.30 per Share and Operating Income* at $2.82

Cincinnati, February 7, 2007 – Cincinnati Financial Corporation (Nasdaq: CINF) today reported:

Fourth-quarter net income of 75 cents per share and operating income of 70 cents per share

Full-year net income of $5.30 per share including $2.35 from first-quarter 2006 sale of Alltel common stock holding.

Record book value of $39.38 per share, up 12.9 percent from year-end 2005.

Property casualty underwriting profits of $181 million tempered by higher catastrophe losses, increased loss severity and less savings from favorable development on prior period losses as well as higher underwriting expenses.

Financial Highlights


(Dollars in millions except share data)	Three months ended December 31,					Twelve months ended December 31,
(Dollars in millions except share data)		2006		2005	Change %		2006		2005	Change %
Revenue Highlights
Earned premiums	$	832	$	803	3.6	$	3,278	$	3,164	3.6
Investment income		145		136	6.7		570		526	8.4
Total revenues		995		967	2.9		4,550		3,767	20.8
Income Statement Data
Net income	$	130	$	183	(28.6)	$	930	$	602	54.5
Net realized investment gains and losses		8		16	(49.7)		434		40	993.0
Operating income*	$	122	$	167	(26.6)	$	496	$	562	(11.8)
Per Share Data (diluted)
Net income	$	0.75	$	1.03	(27.2)	$	5.30	$	3.40	55.9
Net realized investment gains and losses		0.05		0.09	(44.4)		2.48		0.23	978.3
Operating income*	$	0.70	$	0.94	(25.5)	$	2.82	$	3.17	(11.0)

Book value						$	39.38	$	34.88	12.9
Cash dividend declared	$	0.335	$	0.305	9.8	$	1.34	$	1.205	11.2
Weighted average shares outstanding	174,988,162		177,045,508		(1.2)	175,451,341		177,116,126		(0.9)

Insurance Operations Highlights

3.8 percent and 3.3 percent increases in fourth-quarter and full-year property casualty net written premiums.

Strong commercial lines growth with 2006 net written premiums up 6.7 percent and new business written by our agencies up 14.9 percent to a record $324 million.

Second-half 2006 personal lines new business up 17.6 percent. Pricing changes made July 1, 2006, improved ability to market personal lines.

94.5 percent and 94.3 percent fourth-quarter and full-year property casualty combined ratios, in line with previous announcement.

5.5 percentage points from catastrophe losses in the 2006 fourth-quarter and full-year combined ratios. In the comparable 2005 periods, catastrophe losses accounted for 5.6 and 4.1 percentage points of the ratios.

4 cents and 19 cents contribution from the life insurance operations to fourth-quarter and full-year operating income.

Investment and Balance Sheet Highlights

6.7 percent and 8.4 percent growth in fourth-quarter and full-year pretax investment income.

Book value of $39.38 at year-end 2006, up $4.50 from year-end 2005. Invested assets rose on new investments and appreciation in the equity portfolio.

Full-year 2007 Outlook**

Property casualty net written premium growth expected to be in the low single digits in 2007. New agency appointments and new states to help drive long-term growth.

Combined ratio expected to be 97 percent to 99 percent in 2007, assuming catastrophe losses contribute approximately 5.5 percentage points.

Investment income growth target at 6.5 percent to 7.0 percent range for 2007.

The Definitions of Non-GAAP Information and Reconciliation to Comparable GAAP Measures on Page 13 defines and reconciles measures presented in this release that are not based on Generally Accepted Accounting Principles or Statutory Accounting Principles.

Outlook and related assumptions are subject to the risks outlined in the company’s forward-looking information safe-harbor statement (see Page 10).

Current Results and Long-term Position

“We reached record levels of new business and total property casualty insurance premiums in 2006 in the face of growing competition,” said John J. Schiff, Jr., CPCU, chairman and chief executive officer. “Business policyholders continued to respond favorably to their local independent agents’ presentation of the Cincinnati value proposition. In the second half of the year, agents and personal lines policyholders responded to new pricing for Cincinnati’s personal lines products with higher customer retention rates and rising new business. Further, our equity-focused investment strategy led to another year of record investment income and record book value.”

“However, other factors dampen our enthusiasm for those favorable results. Nine catastrophe events, primarily storms affecting our policyholders in the Midwest, led to a record level of catastrophe losses even as the industry experienced a lighter catastrophe year. Loss severity crept upward. And ongoing investment in our people and our infrastructure, including technology and systems to make it easier for agents to do business with our company, contributed to expenses rising more rapidly than premiums,” Schiff noted.

“Finally, this year’s earnings reflected the adoption of stock option expensing, and as anticipated, savings from favorable development on prior period losses was below the unusually high level of the past few years,” Schiff noted.

“We look beyond this year with confidence. We remain committed to providing a stable market for our agents’ high quality business, underwriting this business carefully and producing steady value for our shareholders, as represented by the board of directors’ recent decision to increase our 2007 indicated annual dividend by 6 percent, which would mark the 47^th consecutive year of increase in that measure. Their action reflected our belief that we can achieve above-industry-average growth in written premiums and industry-leading profitability over the long term by building on our proven strategies: strong agency relationships, front-line underwriting, quality claims service, solid reserves, and total return investing,” Schiff said.

New States and New Agency Appointments to Support Continued Growth

Schiff added, “We finished 2006 with more agencies than ever, making 55 new agency appointments during the course of the year. Over the past 10 years, we have selectively added more than 400 highly professional agencies. As part of our plans for 2007, we expect to appoint another 50+ agencies. We are working on plans to enter New Mexico and eastern Washington within the next year and will soon begin the process by preparing policy forms and rates to submit to the departments of insurance in those states.

“Whether appointing new agencies in our current states or moving into new geographic areas, we look for the most professionally managed agencies in each area where we see opportunities to bring Cincinnati’s insurance products and services to families and businesses. Field teams introduce these agencies to the Cincinnati value proposition – customized coverage packages, multi-year commercial policies, superior claims service, our A++ rating from A.M. Best Co. and local field representatives with decision-making authority. Within the five years following an appointment, Cincinnati sets out to earn a prominent position among the carriers serving that agency. We have seen annual premiums from newly appointed agencies rise to an average of approximately $2 million by the fifth year.”

2006 Catastrophe Losses

James E. Benoski, vice chairman, chief insurance officer and president, said, “Again in 2006, policyholders had ample opportunities to benefit from the Cincinnati relationship. In early October, a Midwest storm caused heavy hail damage in central Ohio, resulting in an estimated $38 million of losses for our policyholders. In late-November, another storm across the Midwest resulted in $8 million of fourth-quarter losses.

“Of the more than 12,000 catastrophe claims reported through January 31, 2007, for severe storms during 2006, more than 90 percent are already closed. Our field claims representatives’ prompt responses and personal approach reflect positively on our agents, supporting their marketing efforts,” Benoski noted.

2007 Property Casualty Outlook Update

Kenneth W. Stecher, chief financial officer and executive vice president commented, “While we expect competition to continue accelerating in most property casualty business lines in 2007, we believe that our strong agency relationships will lead to full-year 2007 net written premium growth in the low single digits. That growth rate takes into account an anticipated $22 million increase in reinsurance premiums we pay. Our strong financial position affords us the flexibility to help manage the increase by raising our risk retention to a slightly higher level.”

Stecher added, “If catastrophe losses contribute approximately 5.5 percentage points to the ratio, we would expect the full-year combined ratio to be in the 97 percent to 99 percent range. Several factors support this view. First, the loss and loss expense ratio may move up as pricing becomes even more competitive and loss costs increase.

“Second, we continue to see favorable reserve development attributable to improving loss trends following the re-underwriting of our commercial lines business between 2000 and 2003. As more data that reflects the improved commercial lines risk profile becomes available, we should be able to improve the accuracy of our initial estimates of reserves for incurred by not yet reported claims. Over the next several years, these ongoing improvements in the accuracy of reserve estimates should result in savings from favorable development moving below this year’s level.

“Finally, continued investment in people and technology may contribute to an increase in other underwriting expenses, particularly while premium growth is slowing.”

Investment Strategy Key to Long-term Growth and Stability

“Our buy-and-hold equity investing strategy is key to the company’s long-term growth and stability,” Schiff noted. “We are looking for pretax investment income growth in the range of 6.5 percent to 7.0 percent in 2007, and we continue to invest to further build book value, an important measure of our long-term success.”

Schiff noted, “In 2007, we anticipate allocating a higher proportion of cash available for investment to equity securities. We continue to identify companies with the potential for revenue, earnings and dividend growth, a strong management team and favorable outlook. These equities offer a steadily increasing flow of dividend income along with the potential for capital appreciation.”

Stecher added, “When allocating available cash for investment between fixed-maturity securities, equities and share repurchase, we are mindful of rating agency capitalization measures. We believe that our strong capitalization and high insurer financial strength ratings give our agents a distinct advantage marketing to value-oriented clients.”

Property Casualty Insurance Operations


(Dollars in millions)	Three months ended December 31,							Twelve months ended December 31,
(Dollars in millions)		2006			2005		Change %		2006			2005		Change %
Written premiums	$	755		$	727		3.8	$	3,178		$	3,076		3.3

Earned premiums	$	802		$	775		3.5	$	3,164		$	3,058		3.5

Loss and loss expenses excluding catastrophes		458			373		22.6		1,833			1,685		8.8
Catastrophe loss and loss expenses		44			44		1.1		175			127		37.9
Commission expenses		144			142		1.6		596			592		0.7
Underwriting expenses		108			93		14.6		363			319		13.9
Policyholder dividends		4			(2)		300.9		16			5		208.1
Underwriting profit	$	44		$	125		(64.6)	$	181		$	330		(45.2)

Ratios as a percent of earned premiums:
Loss and loss expenses excluding catastrophes		57.1	%		48.2	%			58.0	%		55.1	%
Catastrophe loss and loss expenses		5.5			5.6				5.5			4.1
Loss and loss expenses		62.6	%		53.8	%			63.5	%		59.2	%
Commission expenses		18.0			18.3				18.8			19.4
Underwriting expenses		13.3			12.1				11.5			10.4
Policyholder dividends		0.6			(0.3)				0.5			0.2
Combined ratio		94.5	%		83.9	%			94.3	%		89.2	%

3.8 percent rise in fourth-quarter property casualty net written premiums, with a 3.3 percent full-year increase.

$88 million in fourth-quarter new business written directly by agencies, up 6.3 percent. Full-year new business rose 13.5 percent to $357 million.

1,066 agency relationships with 1,289 reporting locations marketing our insurance products at year-end 2006, up from 1,024 agency relationships with 1,252 locations at year-end 2005.

94.3 percent full-year 2006 property casualty combined ratio. The ratio rose 5.1 percentage points largely because of softer pricing, higher catastrophe losses, increased loss severity, less savings from favorable development on prior period losses and higher expenses.

$44 million in fourth-quarter 2006 catastrophe losses, reflecting $46 million from severe storms during the period and $2 million of savings from development on prior period storms. $175 million in full-year 2006 catastrophe losses contributed 5.5 percentage points to the combined ratio.

Catastrophe Loss and Loss Expenses Incurred


(In millions, net of reinsurance)			Twelve months ended December 31, 2006
		Region		Commercial		Personal
Dates	Cause of loss	Region		lines		lines		Total
Mar. 11-13	Wind, hail	Midwest, Mid-Atlantic	$	29	$	8	$	37
Apr. 2-3	Wind, hail	Midwest		12		5		17
Apr. 6-8	Wind, hail	South		13		24		37
Apr. 13-15	Wind, hail	South		4		6		10
Jun. 18-22	Wind, hail, flood	South		3		2		5
Jul. 19-21	Wind, hail, flood	South		4		1		5
Aug. 23-25	Wind, hail, flood	Midwest		5		2		7
Oct. 2-4	Wind, hail, flood	Midwest		7		31		38
Nov. 30 - Dec. 3	Wind, hail, ice, snow	Midwest, South		4		4		8
Other 2006 and development on 2005 and prior catastrophes				8		3		11
Totals			$	89	$	86	$	175

Fourth-quarter 2006 net savings from favorable development on prior period reserves improved the combined ratio by 10.0 percentage points. In last year’s fourth quarter, savings improved the ratio by 10.3 percentage points.

Full-year 2006 net savings from favorable development improved the combined ratio by 3.7 percentage points. In 2005, savings improved the ratio by 5.2 percentage points.

2007 property casualty reinsurance program finalized. Program updated to maintain balance between the cost of the programs and the level of risk retained. Estimated incremental premium increase of $22 million primarily due to higher rates.

2007 Reinsurance Programs


Treaties	Retention Summary	Comments
Property catastrophe treaty	For any one event: · Retain 100% of first $45 million in losses · Retain 5% of losses between $45 million and $200 million · Retain 14% of losses between $200 million and $300 million · Retain 18% of losses between $300 million and $500 million	· After reinsurance, our maximum exposure to a catastrophic event that caused $500 million in covered losses would be $103 million compared with $68 million in 2006. The largest catastrophe loss in our history was $87 million before reinsurance.
Property and casualty per risk treaties	For a single loss: · Retain 100% of first $4 million in losses · Retain 0% of losses between $4 million and $25 million · Obtain facultative reinsurance for losses above $25 million	· No changes in 2007
Casualty third excess treaty	· $25 million excess of $25 million	· No changes in 2007
Casualty fourth excess treaty	· $20 million excess of $50 million	· No changes in 2007

Commercial Lines Insurance Operations


(Dollars in millions)	Three months ended December 31,							Twelve months ended December 31,
(Dollars in millions)		2006			2005		Change %		2006			2005		Change %
Written premiums	$	589		$	548		7.5	$	2,442		$	2,290		6.7

Earned premiums	$	619		$	576		7.4	$	2,402		$	2,254		6.6

Loss and loss expenses excluding catastrophes		357			280		27.1		1,377			1,222		12.7
Catastrophe loss and loss expenses		11			14		(18.0)		89			76		16.6
Commission expenses		113			114		(0.4)		444			438		1.4
Underwriting expenses		79			67		16.4		268			228		17.8
Policyholder dividends		4			(2)		300.9		16			5		208.1
Underwriting profit	$	55		$	103		(46.4)	$	208		$	285		(27.0)

Ratios as a percent of earned premiums:
Loss and loss expenses excluding catastrophes		57.6	%		48.7	%			57.3	%		54.2	%
Catastrophe loss and loss expenses		1.9			2.4				3.7			3.4
Loss and loss expenses		59.5	%		51.1	%			61.0	%		57.6	%
Commission expenses		18.3			19.7				18.5			19.5
Underwriting expenses		12.6			11.7				11.1			10.1
Policyholder dividends		0.7			(0.4)				0.7			0.2
Combined ratio		91.1	%		82.1	%			91.3	%		87.4	%

7.5 percent growth in fourth-quarter commercial lines net written premiums, with a 6.7 percent full-year increase.

$80 million in new commercial lines business written directly by agencies in fourth-quarter 2006, up 4.9 percent. Full-year new commercial lines business rose 14.9 percent to record $324 million.

91.3 percent full-year 2006 commercial lines combined ratio. The ratio rose 3.9 percentage points largely because of softer pricing, increasing loss severity, less savings from favorable development on prior period reserves and adoption of stock option expensing.

Fourth-quarter 2006 net savings from favorable development on prior period reserves improved the commercial lines combined ratio by 10.0 percentage points. In last year’s fourth quarter, savings improved the ratio by 9.6 percentage points.

Full-year 2006 net savings from favorable development improved the commercial lines combined ratio by 4.1 percentage points. In 2005, savings improved the ratio by 5.6 percentage points.

1.0 percentage-point decrease in full-year commercial lines commission expense ratio, primarily due to lower profit-sharing commissions on lower overall underwriting profits.

1.0 percentage-point increase in full-year commercial lines non-commission expense ratio, excluding policyholder dividends. Higher staffing expense was the primary reason for the increase, with stock option expense contributing 0.5 percentage-points to the ratio. Higher technology expense also contributed to the increase.

Commercial casualty, commercial property and workers’ compensation – three of the company’s four largest commercial business lines – reported strong net written premium growth in 2006. Healthy new business and policy retention rates offset pricing pressures due to competitive market conditions. As expected, the fourth of the largest business lines – commercial auto – saw net written premiums decline slightly due to pricing.

Continued strong commercial lines profitability although softer pricing, increased loss severity and changes in reserve development also affected comparisons for some business lines. For the second consecutive quarter, the commercial auto and workers’ compensation business lines experienced higher-than-anticipated new large losses. In the fourth quarter, new large losses in the commercial casualty business line also were higher than anticipated.

2007 plans include integration with agency management systems for WinCPP®, the company’s online, real-time commercial lines rate quoting system used by all agencies. Plans also include roll-out of Businessowner (BOP) and Dentist’s Package Policy (DBOP) capabilities in 12 additional states for e-CLAS™, the company’s Web-based policy processing system currently used in seven states representing 44 percent of BOP and DBOP premiums.

Personal Lines Insurance Operations


(Dollars in millions)	Three months ended December 31,							Twelve months ended December 31,
(Dollars in millions)	2006			2005			Change %		2006			2005		Change %
Written premiums	$	166		$	179		(7.4)	$	736		$	786		(6.4)

Earned premiums	$	183		$	199		(8.0)	$	762		$	804		(5.3)

Loss and loss expenses excluding catastrophes		101			93		9.3		456			463		(1.5)
Catastrophe loss and loss expenses		33			30		10.2		86			51		69.8
Commission expenses		31			28		9.6		152			154		(1.6)
Underwriting expenses		29			26		10.0		95			91		4.2
Underwriting profit (loss)	$	(11)		$	22		(150.2)	$	(27)		$	45		(160.0)

Ratios as a percent of earned premiums:
Loss and loss expenses excluding catastrophes		55.5	%		46.8	%			59.9	%		57.6	%
Catastrophe loss and loss expenses		17.9			14.9				11.3			6.3
Loss and loss expenses		73.4	%		61.7	%			71.2	%		63.9	%
Commission expenses		16.9			14.2				19.9			19.2
Underwriting expenses		15.7			13.1				12.5			11.3
Combined ratio		106.0	%		89.0	%			103.6	%		94.4	%

7.4 percent decrease in fourth-quarter personal lines net written premiums, with a 6.4 percent full-year decrease, in part due to reduced pricing effective July 2006.

17.6 percent increase in new personal lines business written directly by agencies for the second half of 2006, following the pricing changes that improved agents’ ability to market personal lines. With pricing reduced to better compete in the current market, agents had more opportunity to sell service and value, contributing to improved policy retention and new business growth.

Fourth-quarter 2006 personal lines new business rose 21.3 percent to $9 million. Second-half new business growth offset the decline in the first half of 2006, leading to 1.6 percent full-year new business growth.

103.6 percent 2006 personal lines combined ratio. The 9.2 percentage-point increase reflected a 5.0 percentage point rise in catastrophe losses. Other factors included the decline in earned premiums, less savings from favorable development on prior period reserves, the third-quarter 2006 uptick in loss severity and higher expenses.

Fourth-quarter 2006 net savings from favorable development on prior period reserves improved the personal lines combined ratio by 9.6 percentage points. In last year’s fourth quarter, savings improved the ratio by 12.5 percentage points.

Full-year 2006 net savings from favorable development improved the personal lines combined ratio by 2.4 percentage points. In 2005, savings improved the ratio by 4.3 percentage points.

0.7 percentage-point increase in full-year personal lines commission expense ratio, primarily because of higher contingent commissions due to accrual and allocation adjustments.

1.2 percentage point increase in personal lines non-commission expense ratio. Higher staffing expense contributed to the increase, with stock option expense adding 0.5 percentage-points to the ratio. Higher technology expense was the other significant factor in the increase.

82 percent of agencies writing personal lines policies now use Diamond, the company’s personal lines policy processing system. Approximately 90 percent of total 2006 personal lines earned premium volume was written in the 13 active Diamond states. Agents in Pennsylvania and Virginia will begin using Diamond early this year, with several other states planned for later in 2007.

Personal auto – the company’s largest personal business line – reported another full year of healthy profitability despite a fourth-quarter uptick in the loss ratio.

Homeowner results reflected higher catastrophe losses as well as industrywide trends of higher material costs, increased insured property values and rising deductibles. Loss severity returned to a more normal level after rising in the third quarter.

Life Insurance Operations


(In millions)	Three months ended December 31,					Twelve months ended December 31,
(In millions)	2006		2005		Change %	2006		2005		Change %
Written premiums	$	41	$	43	(5.1)	$	161	$	205	(21.3)

Earned premiums	$	31	$	28	10.5	$	115	$	106	7.9
Investment income, net of expenses		27		26	4.0		108		99	8.4
Other income		1		1	(2.3)		3		4	(0.2)
Total revenues, excluding realized investment gains and losses		59		55	7.2		226		209	8.0
Policyholder benefits		30		25	22.9		122		102	20.1
Expenses		18		15	17.7		51		52	(1.8)
Total benefits and expenses		48		40	20.9		173		154	12.6
Net income before income tax and realized investment gains and losses		11		15	(29.5)		53		55	(5.0)
Income tax		4		6	(36.0)		19		19	(1.9)
Net income before realized investment gains and losses	$	7	$	9	(25.5)	$	34	$	36	(6.6)

$161 million in full-year 2006 total life insurance segment net written premiums, compared with $205 million in 2005. Written premiums include life insurance, annuity and accident and health premiums.

12.7 percent increase to $127 million in statutory written premiums for term and other life insurance products in 2006. Since late 2005, the company has de-emphasized annuities because of an unfavorable interest rate environment. Statutory written annuity premiums decreased to $30 million in 2006 from $88 million in 2005.

27.2 percent rise in 2006 term life insurance written premiums reflecting competitive advantages of offering competitive, up-to-date products, providing close personal attention and exhibiting financial strength and stability.

10.6 percent rise in face amount of life policies in force to $56.871 billion at year-end 2006, from $51.493 billion at year-end 2005.

$19 million increase in full-year 2006 benefits and expenses compared with 2005, principally due to reserve and mortality expense increases associated with growth and aging of life insurance in force. Mortality experience remained within pricing guidelines. Adoption of stock option expensing contributed approximately $1 million to operating expenses.

2007 plans include enhancement of term and other life insurance products, including an expanded worksite product portfolio, and introduction of two new universal and whole life products. The priority continues to be expansion within the insurance agencies currently marketing our property casualty insurance products.

Investment Operations


(In millions)		Three months ended December 31,					Twelve months ended December 31,
(In millions)		2006		2005	Change %		2006		2005	Change %
Investment income:
Interest	$	75	$	72	3.9	$	300	$	280	7.1
Dividends		68		63	7.4		262		244	7.5
Other		4		2	133.2		15		8	90.0
Investment expenses		(2)		(1)	(34.2)		(7)		(6)	(19.3)
Total net investment income		145		136	6.7		570		526	8.4
Investment interest credited to contract holders		(14)		(13)	(4.8)		(54)		(51)	(5.7)
Net realized investment gains and losses:
Realized investment gains and losses		11		28	(60.9)		678		69	883.0
Change in valuation of embedded derivatives		2		(5)	131.0		7		(7)	200.7
Other-than-temporary impairment charges		0		0	(100.0)		(1)		(1)	41.7
Net realized investment gains (losses)		13		23	(46.6)		684		61	1,026.0
Investment operations income	$	144	$	146	(1.5)	$	1,200	$	536	124.0

6.7 percent increase in fourth-quarter pretax net investment income with 8.4 percent increase for the year. Fifth Third Bancorp, the company’s largest equity holding, contributed 43.8 percent of 2006 full-year dividend income.

Growth in investment income reflected new investments, higher interest income from the growing fixed-maturity portfolio and increased dividend income from the common stock portfolio. In addition, proceeds from the sale of the Alltel Corporation holding used to make the applicable tax payments in 2006 were invested in short-term instruments that generated approximately $5 million in interest income in 2006.

$16 million annually in additional investment income expected during 2007 from dividend increases announced during 2006 by Fifth Third and another 37 of the 50 common stock holdings in the equity portfolio.

$684 million in full-year 2006 net realized investment gains (pretax), including $647 million from the first-quarter sale of the company’s holdings of Alltel common stock.

Balance Sheet


(Dollars in millions except share data)							At December 31,
(Dollars in millions except share data)								2006			2005
Balance sheet data
Invested assets							$	13,759		$	12,702
Total assets								17,222			16,003
Short-term debt								49			0
Long-term debt								791			791
Shareholders' equity								6,808			6,086
Book value per share								39.38			34.88
Debt-to-capital ratio								11.0	%		11.5	%

	Three months ended Dec. 31,						Twelve months ended Dec. 31,
		2006			2005			2006			2005
Performance measures
Comprehensive income	$	416		$	137		$	1,025		$	99
Return on equity		7.9	%		12.1	%		14.4	%		9.8	%
Return on equity based on comprehensive income		25.1			9.1			15.9			1.6

Book value of $39.38 at year-end 2006, up $4.50 from year-end 2005 level. Invested assets rose from year-end 2005 because of new investments and appreciation in the equity portfolio. Equity portfolio returned 16.1 percent in 2006 compared with a 15.8 percent return for the Standard & Poor’s 500 Index.

$4.723 billion in statutory surplus for the property casualty insurance group at year-end 2006, up from $4.194 billion at year-end 2005. The ratio of common stock to statutory surplus for the property casualty insurance group portfolio was 97.3 percent at year-end 2006, compared with 97.0 percent at year-end 2005.

31.5 percent ratio of investment securities held at the holding-company level to total holding-company-only assets at year-end 2006, comfortably within management’s below-40 percent target.

504,221 shares repurchased in fourth quarter. Full-year 2006 repurchases totaled 2,646,787 shares for a total cost of $118 million.

Cincinnati Financial Corporation offers property and casualty insurance, its main business, through The Cincinnati Insurance Company, The Cincinnati Indemnity Company and The Cincinnati Casualty Company. The Cincinnati Life Insurance Company markets life and disability income insurance and annuities. CFC Investment Company offers commercial leasing and financing services. CinFin Capital Management Company provides asset management services to institutions, corporations and individuals. For additional information about the company, please visit www.cinfin.com.

For additional information or to register for this morning’s conference call webcast, please visit www.cinfin.com/investors.

This is our “Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995. Our business is subject to certain risks and uncertainties that may cause actual results to differ materially from those suggested by the forward-looking statements in this report. Some of those risks and uncertainties are discussed in our 2005 Annual Report on Form 10-K, Item 1A, Risk Factors, Page 21. Although we often review or update our forward-looking statements when events warrant, we caution our readers that we undertake no obligation to do so.

Factors that could cause or contribute to such differences include, but are not limited to:

Unusually high levels of catastrophe losses due to risk concentrations, changes in weather patterns, environmental events, terrorism incidents or other causes

Increased frequency and/or severity of claims

Inaccurate estimates or assumptions used for critical accounting estimates

Events or actions, including unauthorized intentional circumvention of controls, that reduce the company’s future ability to maintain effective internal control over financial reporting under the Sarbanes-Oxley Act of 2002

Events or conditions that could weaken or harm the company’s relationships with its independent agencies and hamper opportunities to add new agencies, resulting in limitations on the company’s opportunities for growth, such as:

○

Downgrade of the company’s financial strength ratings,

○

Concerns that doing business with the company is too difficult or

○

Perceptions that the company’s level of service, particularly claims service, is no longer a distinguishing characteristic in the marketplace

Delays or inadequacies in the development, implementation, performance and benefits of technology projects and enhancements

Ability to obtain adequate reinsurance on acceptable terms, amount of reinsurance purchased, financial strength of reinsurers and the potential for non-payment or delay in payment by reinsurers

Increased competition that could result in a significant reduction in the company’s premium growth rate

Underwriting and pricing methods adopted by competitors that could allow them to identify and flexibly price risks, which could decrease our competitive advantages

Actions of insurance departments, state attorneys general or other regulatory agencies that:

○

Restrict our ability to exit or reduce writings of unprofitable coverages or lines of business

○

Place the insurance industry under greater regulatory scrutiny or result in new statutes, rules and regulations

○

Increase our expenses

○

Add assessments for guaranty funds, other insurance related assessments or mandatory reinsurance arrangements; or that impair our ability to recover such assessments through future surcharges or other rate changes

○

Limit our ability to set fair, adequate and reasonable rates

○

Place us at a disadvantage in the marketplace or

○

Restrict our ability to execute our business model, including the way we compensate agents

Sustained decline in overall stock market values negatively affecting the company’s equity portfolio and book value; in particular a sustained decline in the market value of Fifth Third Bancorp (NASDAQ:FITB) shares, a significant equity holding

Recession or other economic conditions or regulatory, accounting or tax changes resulting in lower demand for insurance products

Events that lead to a significant decline in the value of a particular security and impairment of the asset

Prolonged low interest rate environment or other factors that limit the company’s ability to generate growth in investment income or interest-rate fluctuations that result in declining values of fixed-maturity investments

Adverse outcomes from litigation or administrative proceedings

Investment activities or market value fluctuations that trigger restrictions applicable to the parent company under the Investment Company Act of 1940

Events, such as an avian flu epidemic, natural catastrophe or construction delays, that could hamper our ability to assemble our workforce at our headquarters location

Further, the company’s insurance businesses are subject to the effects of changing social, economic and regulatory environments. Public and regulatory initiatives have included efforts to adversely influence and restrict premium rates, restrict the ability to cancel policies, impose underwriting standards and expand overall regulation. The company also is subject to public and regulatory initiatives that can affect the market value for its common stock, such as recent measures affecting corporate financial reporting and governance. The ultimate changes and eventual effects, if any, of these initiatives are uncertain.

Cincinnati Financial Corporation

Consolidated Balance Sheets


(Dollars in millions except per share data)		December 31,		December 31,
(Dollars in millions except per share data)		2006		2005
		(unaudited)
ASSETS
Investments
Fixed maturities, at fair value (amortized cost: 2006—$5,739; 2005—$5,387)	$	5,805	$	5,476
Equity securities, at fair value (cost: 2006—$2,621; 2005—$2,128)		7,799		7,106
Short-term investments, at fair value (amortized cost: 2006—$95; 2005—$75)		95		75
Other invested assets		60		45
Cash and cash equivalents		202		119
Investment income receivable		121		117
Finance receivable		108		105
Premiums receivable		1,128		1,116
Reinsurance receivable		683		681
Prepaid reinsurance premiums		13		14
Deferred policy acquisition costs		453		429
Land, building and equipment, net, for company use (accumulated depreciation: 2006—$261; 2005—$232)		193		168
Other assets		58		66
Separate accounts		504		486
Total assets	$	17,222	$	16,003

LIABILITIES
Insurance reserves
Loss and loss expense reserves	$	3,896	$	3,661
Life policy reserves		1,409		1,343
Unearned premiums		1,579		1,559
Other liabilities		533		455
Deferred income tax		1,653		1,622
Notes payable		49		0
6.125% senior notes due 2034		371		371
6.9% senior debentures due 2028		28		28
6.92% senior debenture due 2028		392		392
Separate accounts		504		486
Total liabilities		10,414		9,917

SHAREHOLDERS' EQUITY
Common stock, par value-$2 per share; authorized: 2006-500 million shares, 2005- 500 million shares; issued: 2006-196 million shares, 2005-194 million shares		391		389
Paid-in capital		1,015		969
Retained earnings		2,786		2,088
Accumulated other comprehensive income		3,379		3,284
Treasury stock at cost (2006—23 million shares, 2005—20 million shares)		(763)		(644)
Total shareholders' equity		6,808		6,086
Total liabilities and shareholders' equity	$	17,222	$	16,003

Cincinnati Financial Corporation

Consolidated Statements of Income


(In millions except per share data)		Three months ended December 31,			Twelve months ended December 31,
(In millions except per share data)		2006		2005		2006		2005
		(unaudited)				(unaudited)
REVENUES
Earned premiums
Property casualty	$	802	$	775	$	3,163	$	3,058
Life		31		28		115		106
Investment income, net of expenses		145		136		570		526
Realized investment gains and losses		12		23		684		61
Other income		5		5		18		16
Total revenues		995		967		4,550		3,767

BENEFITS AND EXPENSES
Insurance losses and policyholder benefits		532		442		2,128		1,911
Commissions		153		151		630		627
Other operating expenses		100		76		354		302
Taxes, licenses and fees		19		19		77		72
Increase in deferred policy acquisition costs		5		5		(21)		(19)
Interest expense		14		13		53		51
Total benefits and expenses		823		706		3,221		2,944

INCOME BEFORE INCOME TAXES		172		261		1,329		823

PROVISION (BENEFIT) FOR INCOME TAXES
Current		41		61		404		188
Deferred		1		17		(5)		33
Total provision for income taxes		42		78		399		221

NET INCOME	$	130	$	183	$	930	$	602

PER COMMON SHARE
Net income—basic	$	0.75	$	1.04	$	5.36	$	3.44
Net income—diluted	$	0.75	$	1.03	$	5.30	$	3.40

Since 1996, Cincinnati Financial has disclosed the estimated impact of stock options on net income and earnings per share in a Note to the Financial Statements. For the fourth-quarter and year ended December 31, 2005, diluted net income would have been reduced by approximately 2 cents and 8 cents per share, if option expense, calculated using the binomial option-pricing model, were included as an expense.

***

Definitions of Non-GAAP Information and
Reconciliation to Comparable GAAP Measures

(See attached tables for 2006 and 2005 data; prior-period reconciliations available at www.cinfin.com/investors.)

Cincinnati Financial Corporation prepares its public financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP). Statutory data is prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners’ (NAIC) Accounting Practices and Procedures Manual and therefore is not reconciled to GAAP data.

Management uses certain non-GAAP and non-statutory financial measures to evaluate its primary business areas – property casualty insurance, life insurance and investments – when analyzing both GAAP and certain non-GAAP measures may improve understanding of trends in the underlying business, helping avoid incorrect or misleading assumptions and conclusions about the success or failure of company strategies. Management adjustments to GAAP measures generally: apply to non-recurring events that are unrelated to business performance and distort short-term results; involve values that fluctuate based on events outside of management’s control; or relate to accounting refinements that affect comparability between periods, creating a need to analyze data on the same basis.

Operating income: Operating income is calculated by excluding net realized investment gains and losses (defined as realized investment gains and losses after applicable federal and state income taxes) from net income. Management evaluates operating income to measure the success of pricing, rate and underwriting strategies. While realized investment gains (or losses) are integral to the company’s insurance operations over the long term, the determination to realize investment gains or losses in any period may be subject to management’s discretion and is independent of the insurance underwriting process. Also, under applicable GAAP accounting requirements, gains and losses can be recognized from certain changes in market values of securities and embedded derivatives without actual realization. Management believes that the level of realized investment gain s or losses for any particular period, while it may be material, may not fully indicate the performance of ongoing underlying business operations in that period.

For these reasons, many investors and shareholders consider operating income to be one of the more meaningful measures for evaluating insurance company performance. Equity analysts who report on the insurance industry and the company generally focus on this metric in their analyses. The company presents operating income so that all investors have what management believes to be a useful supplement to GAAP information.

Statutory accounting rules: For public reporting, insurance companies prepare financial statements in accordance with GAAP. However, insurers also must calculate certain data according to statutory accounting rules as defined in the NAIC’s Accounting Practices and Procedures Manual, which may be, and has been, modified by various state insurance departments. Statutory data is publicly available, and various organizations use it to calculate aggregate industry data, study industry trends and compare insurance companies.

Written premium: Under statutory accounting rules, property casualty written premium is the amount recorded for policies issued and recognized on an annualized basis at the effective date of the policy. Management analyzes trends in written premium to assess business efforts. Earned premium, used in both statutory and GAAP accounting, is calculated ratably over the policy term. The difference between written and earned premium is unearned premium.

Written premium adjustment – statutory basis only: In 2002, the company refined its estimation process for matching property casualty written premiums to policy effective dates, which added $117 million to 2002 written premiums. To better assess ongoing business trends, management may exclude this adjustment when analyzing trends in written premiums and statutory ratios that make use of written premiums.

Codification: Adoption of Codification of Statutory Accounting Principles was required for Ohio-based insurance companies effective January 1, 2001. The adoption of Codification changed the manner in which the company recognized statutory property casualty written premiums. As a result, 2001 statutory written premiums included $402 million to account for unbooked premiums related to policies with effective dates prior to January 1, 2001. To better assess ongoing business trends, management excludes this $402 million when analyzing written premiums and statutory ratios that make use of written premiums.

Life insurance gross written premiums: In analyzing the life insurance company’s gross written premiums, management excludes five larger, single-pay life insurance policies (bank-owned life insurance or BOLIs) written in 2004, 2002, 2000 and 1999 to focus on the trend in premiums written through the independent agency distribution channel.

One-time charges or adjustments: Management analyzes earnings and profitability excluding the impact of one-time items.

○

In 2003, as the result of a settlement negotiated with a vendor, pretax results included the recovery of $23 million of the $39 million one-time, pretax charge incurred in 2000.

○

In 2000, the company recorded a one-time charge of $39 million, pre-tax, to write down previously capitalized costs related to the development of software to process property casualty policies.

○

In 2000, the company earned $5 million in interest in the first quarter from a $303 million single-premium BOLI policy that was booked at the end of 1999 and segregated as a separate account effective April 1, 2000. Investment income and realized investment gains and losses from separate accounts generally accrue directly to the contract holder and, therefore, are not included in the company’s consolidated financials.


Cincinnati Financial Corporation
Quarterly Net Income Reconciliation

(In millions except per share data)	Three months ended																Six months ended				Nine months ended				Twelve months ended
	12/31/06		9/30/06		6/30/06		3/31/06		12/31/05		9/30/05		6/30/05		3/31/05		6/30/06		6/30/05		9/30/06		9/30/05		12/31/06		12/31/05

Net income	$	130	$	115	$	132	$	552	$	183	$	117	$	158	$	144	$	684	$	302	$	800	$	419	$	930	$	602
One-time item		0		0		0		0		0		0		0		0		0		0		0		0		0		0
Net income before one-time item		130		115		132		552		183		117		158		144		684		302		800		419		930		602
Net realized investment gains and losses		8		0		6		421		16		10		8		6		426		14		427		24		434		40
Operating income before one-time item		122		115		126		131		167		107		150		138		258		288		373		395		496		562
Less catastrophe losses		(29)		(18)		(41)		(26)		(28)		(43)		(9)		(2)		(67)		(11)		(85)		(54)		(113)		(82)
Operating income before catastrophe losses and one-time item	$	151	$	133	$	167	$	157	$	195	$	150	$	159	$	140	$	325	$	299	$	458	$	449	$	609	$	644

Diluted per share data
Net income	$	0.75	$	0.66	$	0.76	$	3.13	$	1.03	$	0.66	$	0.89	$	0.81	$	3.90	$	1.70	$	2.13	$	2.37	$	5.30	$	3.40
One-time item		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00
Net income before one-time item		0.75		0.66		0.76		3.13		1.03		0.66		0.89		0.81		3.90		1.70		2.13		2.37		5.30		3.40
Net realized investment gains and losses		0.05		0.00		0.04		2.39		0.09		0.05		0.05		0.03		2.43		0.08		2.43		0.14		2.48		0.23
Operating income before one-time item		0.70		0.66		0.72		0.74		0.94		0.61		0.84		0.78		1.47		1.62		4.56		2.23		2.82		3.17
Less catastrophe losses		(0.16)		(0.10)		(0.24)		(0.14)		(0.16)		(0.24)		(0.05)		(0.01)		(0.38)		(0.06)		(0.48)		(0.30)		(0.65)		(0.46)
Operating income before catastrophe losses and one-time item	$	0.86	$	0.76	$	0.96	$	0.88	$	1.10	$	0.85	$	0.89	$	0.79	$	1.85	$	1.68	$	5.04	$	2.53	$	3.47	$	3.63

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.


Cincinnati Insurance Group
Quarterly Property Casualty Data - Consolidated

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Premiums
Adjusted written premiums (statutory)	$	785		$	787		$	804		$	796		$	765		$	764		$	780		$	787		$	1,600		$	1,567		$	2,387		$	2,332		$	3,172		$	3,097
Written premium adjustment – statutory only		(30)			(7)			10			33			(38)			(3)			10			10			43			20			36			17			6			(21)
Reported written premiums (statutory)*	$	755		$	780		$	814		$	829		$	727		$	761		$	790		$	797		$	1,643		$	1,587		$	2,423		$	2,349		$	3,178		$	3,076
Unearned premiums change		13			11			(21)			(51)			48			4			(25)			(44)			(72)			(73)			(60)			(66)			(66)			(19)
Earned premiums	$	802		$	791		$	793		$	778		$	775		$	765		$	765		$	753		$	1,571		$	1,518		$	2,362		$	2,283		$	3,164		$	3,058

Statutory combined ratio
Reported statutory combined ratio*		95.9	%		96.4			93.7	%		89.6	%		85.8	%		96.6	%		86.6	%		87.3	%		91.7	%		86.9	%		93.2	%		90.1	%		93.9	%		89.0	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory combined ratio		95.9	%		96.4	%		93.7	%		89.6	%		85.8	%		96.6	%		86.6	%		87.3	%		91.7	%		86.9	%		93.2	%		90.1	%		93.9	%		89.0	%
Less catastrophe losses		5.5			3.5			8.0			5.0			5.6			8.6			2.0			0.3			6.5			1.1			5.5			3.6			5.5			4.1
Adjusted statutory combined ratio excluding catastrophe losses		90.4	%		92.9	%		85.7	%		84.6	%		80.2	%		88.0	%		84.6	%		87.0	%		85.2	%		85.8	%		87.7	%		86.5	%		88.4	%		84.9	%

Reported commission expense ratio*		19.9	%		19.3	%		17.6	%		18.1	%		20.4	%		20.3	%		19.3	%		16.8	%		17.9	%		18.0	%		18.3	%		18.8	%		18.7	%		19.2	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted commission expense ratio		19.9	%		19.3	%		17.6	%		18.1	%		20.4	%		20.3	%		19.3	%		16.8	%		17.9	%		18.0	%		18.3	%		18.8	%		18.7	%		19.2	%

Reported other expense ratio*		13.4	%		11.9	%		10.8	%		10.8	%		11.6	%		10.8	%		10.3	%		9.8	%		10.8	%		10.0	%		11.2	%		10.2	%		11.7	%		10.5	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted other expense ratio		13.4	%		11.9	%		10.8	%		10.8	%		11.6	%		10.8	%		10.3	%		9.8	%		10.8	%		10.0	%		11.2	%		10.2	%		11.7	%		10.5	%

Reported statutory expense ratio*		33.3	%		31.2	%		28.4	%		28.9	%		32.0	%		31.1	%		29.6	%		26.6	%		28.7	%		28.0	%		29.5	%		29.0	%		30.4	%		29.7	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory expense ratio		33.3	%		31.2	%		28.4	%		28.9	%		32.0	%		31.1	%		29.6	%		26.6	%		28.7	%		28.0	%		29.5	%		29.0	%		30.4	%		29.7	%

GAAP combined ratio
GAAP combined ratio		94.5	%		96.1	%		94.5	%		92.0	%		83.9	%		96.6	%		87.5	%		88.9	%		93.3	%		88.2	%		94.2	%		91.0	%		94.3	%		89.2	%
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
GAAP combined ratio before one-time item		94.5	%		96.1	%		94.5	%		92.0	%		83.9	%		96.6	%		87.5	%		88.9	%		93.3	%		88.2	%		94.2	%		91.0	%		94.3	%		89.2	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts
may not equal the full year as each is computed independently.
nm - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.


Cincinnati Insurance Group
Quarterly Property Casualty Data - Commercial Lines

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Premiums
Adjusted written premiums (statutory)	$	618		$	589		$	593		$	635		$	584		$	547		$	557		$	617		$	1,228		$	1,174		$	1,817		$	1,721		$	2,435		$	2,306
Written premium adjustment -- statutory only		(29)			(7)			10			33			(36)			(1)			9			12			43			21			36			20			7			(16)
Reported written premiums (statutory)*	$	589		$	582		$	603		$	668		$	548		$	546		$	566		$	629		$	1,271		$	1,195		$	1,853		$	1,741		$	2,442		$	2,290
Unearned premiums change		30			20			(4)			(86)			28			18			(3)			(78)			(90)			(81)			(69)			(63)			(40)			(36)
Earned premiums	$	619		$	602		$	599		$	582		$	576		$	564		$	563		$	551		$	1,181		$	1,114		$	1,783		$	1,678		$	2,402		$	2,254

Statutory combined ratio
Reported statutory combined ratio*		92.4	%		94.1			89.6	%		87.5	%		84.3	%		95.5	%		83.9	%		85.5	%		88.6	%		84.6	%		90.3	%		88.1	%		90.8	%		87.1	%
Written premium adjustment -- statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory combined ratio		92.4	%		94.1	%		89.6	%		87.5	%		84.3	%		95.5	%		83.9	%		85.5	%		88.6	%		84.6	%		90.3	%		88.1	%		90.8	%		87.1	%
Less catastrophe losses		1.9			2.3			5.6			5.1			2.4			9.5			0.4			1.1			5.3			0.8			4.3			3.6			3.7			3.4
Adjusted statutory combined ratio excluding catastrophe losses		90.5	%		91.8	%		84.0	%		82.4	%		81.9	%		86.0	%		83.5	%		84.4	%		83.3	%		83.8	%		86.0	%		84.5	%		87.1	%		83.7	%

GAAP combined ratio
GAAP combined ratio		91.1	%		93.4	%		90.3	%		90.5	%		82.1	%		95.2	%		84.8	%		87.5	%		90.4	%		86.1	%		91.4	%		89.2	%		91.3	%		87.4	%
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
GAAP combined ratio before one-time item		91.1	%		93.4	%		90.3	%		90.5	%		82.1	%		95.2	%		84.8	%		87.5	%		90.4	%		86.1	%		91.4	%		89.2	%		91.3	%		87.4	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.
nm - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.


Cincinnati Insurance Group
Quarterly Property Casualty Data - Personal Lines

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Premiums
Adjusted written premiums (statutory)	$	167		$	198		$	211		$	161		$	181		$	217		$	223		$	170		$	372		$	393		$	570		$	611		$	737		$	791
Written premium adjustment -- statutory only		(1)			0			0			0			(2)			(2)			1			(2)			0			(1)			0			(3)			(1)			(5)
Reported written premiums (statutory)*	$	166		$	198		$	211		$	161		$	179		$	215		$	224		$	168		$	372		$	392		$	570		$	608		$	736		$	786
Unearned premiums change		(17)			(9)			(17)			35			20			(14)			(22)			34			18			8			9			(3)			(26)			17
Earned premiums	$	183		$	189		$	194		$	196		$	199		$	201		$	202		$	202		$	390		$	404		$	579		$	605		$	762		$	804

Statutory combined ratio
Reported statutory combined ratio*		107.7	%		104.0	%		106.4	%		98.1	%		90.1	%		99.9	%		93.6	%		94.0	%		101.6	%		93.7	%		102.3	%		95.7	%		103.6	%		94.3	%
Written premium adjustment -- statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory combined ratio		107.7	%		104.0	%		106.4	%		98.1	%		90.1	%		99.9	%		93.6	%		94.0	%		101.6	%		93.7	%		102.3	%		95.7	%		103.6	%		94.3	%
Less catastrophe losses		17.9			7.0			15.6			5.0			14.9			6.3			6.2			2.0			10.3			2.1			9.2			3.5			11.3			6.3
Adjusted statutory combined ratio excluding catastrophe losses		89.8	%		97.0	%		90.8	%		93.1	%		75.2	%		93.6	%		87.4	%		96.0	%		91.3	%		91.6	%		93.1	%		92.2	%		92.3	%		88.0	%

GAAP combined ratio
GAAP combined ratio		106.0	%		104.4	%		107.6	%		96.4	%		89.0	%		100.5	%		95.3	%		92.7	%		102.0	%		94.0	%		102.8	%		96.1	%		103.6	%		94.4	%
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
GAAP combined ratio before one-time item		106.0	%		104.4	%		107.6	%		96.4	%		89.0	%		100.5	%		95.3	%		92.7	%		102.0	%		94.0	%		102.8	%		96.1	%		103.6	%		94.4	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.
nm - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.

EX-99 3 ex992.htm EXHIBIT 99.2 Cincinnati Financial Corporation


Cincinnati Financial Corporation
Supplemental Financial Data
December 31, 2006
Fourth Quarter


		6200 South Gilmore Road
		Fairfield, Ohio 45014-5141
		www.cinfin.com/investors


Investor Contact:		Media Contact:		Shareholder Contact:
Heather J. Wietzel		Joan O. Shevchik		Jerry L. Litton
513-870-2768		513-603-5323		513-870-2639


Cincinnati Financial Corporation
		A.M. Best	Fitch	Moody’s	Standard & Poor’s

Corporate Debt		aa-	A+	A2	A

The Cincinnati Insurance Companies

		A.M. Best	Fitch	Moody’s	Standard & Poor’s

Property Casualty Group		A++	--	Aa3	AA-
The Cincinnati Insurance Company		A++	AA	Aa3	AA-
The Cincinnati Indemnity Company		A++	AA	Aa3	AA-
The Cincinnati Casualty Company		A++	AA	Aa3	AA-

The Cincinnati Life Insurance Company		A+	AA	--	AA-


	Ratings are as of February 7, 2007, under continuing review and subject to change and/or affirmation. For the latest ratings, select the Ratings tab on www.cinfin.com/investors.

	The consolidated financial statements and financial exhibits that follow are unaudited. These consolidated financial statements and exhibits should be read in conjunction with the consolidated financial statements and notes included in the Annual Report on Form 10-K for 2005. The results of operations for interim periods should not be considered indicative of results to be expected for the full year. Certain 2006 interim period data has been updated to correct rounding differences.


	Cincinnati Financial Corporation
	Supplemental Financial Data
	Fourth Quarter 2006
		Page	Status
	Definitions of Non-GAAP Information and Reconciliation to Comparable GAAP Measures	3	2/7/2007

Consolidated
	Quick Reference	4	2/7/2007
	Consolidated Statements of Income	5	2/7/2007
	CFC and Subsidiary Consolidation – Twelve Months Ended December 31, 2006	6	2/7/2007
	CFC and Subsidiary Consolidation – Twelve Months Ended December 31, 2005	7	2/7/2007
	CFC and Subsidiary Consolidation – Three Months Ended December 31, 2006	8	2/7/2007
	CFC and Subsidiary Consolidation – Three Months Ended December 31, 2005	9	2/7/2007
	Consolidated Balance Sheets	10	2/7/2007
	10-Year Net Income Reconciliation	11	2/7/2007
	Quarterly Net Income Reconciliation	12	2/7/2007
	Top Holdings -- Common Stocks	13	2/7/2007

Property Casualty Insurance Operations
	GAAP Statements of Income	14	2/7/2007
	Statutory Statements of Income	15	2/7/2007
	Statutory Quarterly Analysis – Consolidated	16	2/7/2007
	Statutory Quarterly Analysis – Commercial Lines	17	2/7/2007
	Statutory Quarterly Analysis – Personal Lines	18	2/7/2007
	Direct Written Premiums by Line of Business and State	19	2/7/2007
	Quarterly Property Casualty Data – Commercial Lines of Business	20	2/7/2007
	Quarterly Property Casualty Data – Personal Lines of Business	21	2/7/2007

Reconciliation Data
	10-Year Property Casualty Data – Consolidated	22	2/7/2007
	6-Year Property Casualty Data – Commercial Lines	23	2/7/2007
	6-Year Property Casualty Data – Personal Lines	24	2/7/2007
	Quarterly Property Casualty Data – Consolidated	25	2/7/2007
	Quarterly Property Casualty Data – Commercial Lines	26	2/7/2007
	Quarterly Property Casualty Data – Personal Lines	27	2/7/2007

Life Insurance Operations
	GAAP Statements of Income	28	2/7/2007
	Statutory Statements of Income	29	2/7/2007
	Expenses as a Percentage of Premium	30	2/7/2007

2006 Fourth-Quarter Supplement

Definitions of Non-GAAP Information and
Reconciliation to Comparable GAAP Measures

Operating income: Operating income is calculated by excluding net realized investment gains and losses (defined as realized investment gains and losses after applicable federal and state income taxes) from net income. Management evaluates operating income to measure the success of pricing, rate and underwriting strategies. While realized investment gains (or losses) are integral to the company’s insurance operations over the long term, the determination to realize investment gains or losses in any period may be subject to management’s discretion and is independent of the insurance underwriting process. Also, under applicable GAAP accounting requirements, gains and losses can be recognized from certain changes in market values of securities and embedded derivatives without actual realization. Management believes that the level of realized investment gains or losses for any particular period, while it may be material, may not fully indicate the performance of ongoing underlying business operations in that period.

One-time charges or adjustments: Management analyzes earnings and profitability excluding the impact of one-time items.

○

In 2003, as the result of a settlement negotiated with a vendor, pretax results included the recovery of $23 million of the $39 million one-time, pretax charge incurred in 2000.

○

In 2000, the company recorded a one-time charge of $39 million, pre-tax, to write down previously capitalized costs related to the development of software to process property casualty policies.

○

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation
Quick Reference - Fourth Quarter 2006
(all data shown is for the three months ended or as of December 31, 2006)

(Based on reported data - see Pages 25-27 for adjusted data)

(Dollars in millions except share data)
Revenues:				Benefits and expenses:

Commercial lines net written premiums	$	589		Commercial lines loss and loss expenses	$	368
Year-over-year percentage change		7.5	%	Year-over-year percentage change		25.4	%
Personal lines net written premiums	$	166		Personal lines loss and loss expenses	$	134
Year-over-year percentage change		(7.4)	%	Year-over-year percentage change		10.4	%
Property casualty net written premiums	$	755		Property casualty loss and loss expenses	$	502
Year-over-year percentage change		3.8	%	Year-over-year percentage change		20.4	%
Commercial lines net earned premiums	$	619		Life and accident and health losses and policy benefits	$	30
Year-over-year percentage change		7.4	%	Year-over-year percentage change		22.9	%
Personal lines net earned premiums	$	183		Operating expenses	$	277
Year-over-year percentage change		(8.0)	%	Year-over-year percentage change		9.8	%
Property casualty net earned premiums	$	802		Interest expenses	$	14
Year-over-year percentage change		3.5	%	Year-over-year percentage change		10.4	%
Life and accident and health net earned premiums	$	31		Total expenses	$	823
Year-over-year percentage change		10.5	%	Year-over-year percentage change		16.6	%
Investment income	$	145		Income before income taxes	$	172
Year-over-year percentage change		6.7	%	Year-over-year percentage change		(34.1)	%
Realized gains on investments	$	12		Total income tax	$	42
Year-over-year percentage change		(46.6)	%	Year-over-year percentage change		(46.9)	%
Other income	$	5		Effective tax rate		24.2	%
Year-over-year percentage change		1.6	%
Total revenues	$	995		Ratios:
Year-over-year percentage change		2.9	%
				Commercial lines GAAP combined ratio		91.1	%
Income:				Personal lines GAAP combined ratio		106.0	%
				Property casualty GAAP combined ratio		94.5	%
Operating income	$	122
Year-over-year percentage change		(26.6)	%	Commercial lines STAT combined ratio		92.4	%
Net realized investment gains and losses	$	8		Personal lines STAT combined ratio		107.7	%
Year-over-year percentage change		(49.7)	%	Property casualty STAT combined ratio		95.9	%
Net income	$	130
Year-over-year percentage change		(28.6)	%	Return on equity based upon net income		7.9	%
				Return on equity based upon operating income		25.1	%
Per share: (diluted)
				Balance Sheet:
Operating income	$	0.70
Year-over-year percentage change		(25.5)	%	Fixed maturity investments	$	5,805
Net realized investment gains and losses	$	0.05		Equity securities		7,799
Year-over-year percentage change		(44.4)	%	Other invested assets		155
Net income	$	0.75		Total invested assets	$	13,759
Year-over-year percentage change		(27.2)	%
Book value	$	39.38		Property casualty and life loss and loss expense reserves	$	3,860
Year-over-year percentage change		12.9	%	Total debt		840
Weighted average shares – diluted	174,988,162			Shareholders equity		6,808
Year-over-year percentage change		(1.2)	%

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation
Consolidated Statements of Income

	For the Three Months Ended December 31,								For the Twelve Months Ended December 31,
		2006		2005		Change	% Change		2006		2005		Change	% Change
Revenues:
Premiums earned:
Property casualty	$	844,769,727	$	818,784,983	$	25,984,744	3.17	$	3,320,696,134	$	3,237,013,369	$	83,682,765	2.59
Life		43,271,070		40,421,077		2,849,993	7.05		152,590,039		143,808,461		8,781,578	6.11
Accident health		1,703,987		1,617,668		86,319	5.34		6,652,508		6,347,605		304,903	4.80
Premiums ceded		(57,316,655)		(57,661,923)		345,268	0.60		(202,091,894)		(223,269,321)		21,177,427	9.49
Total premiums earned		832,428,129		803,161,805		29,266,324	3.64		3,277,846,787		3,163,900,114		113,946,673	3.60
Investment income		145,070,825		135,899,274		9,171,551	6.75		570,103,128		525,984,174		44,118,954	8.39
Realized gain on investments		12,324,061		23,074,192		(10,750,131)	(46.59)		683,701,293		60,715,922		622,985,371	1,026.07
Other income		4,682,861		4,608,019		74,842	1.62		18,461,940		16,722,246		1,739,694	10.40
Total revenues	$	994,505,876	$	966,743,290	$	27,762,586	2.87	$	4,550,113,148	$	3,767,322,456	$	782,790,692	20.78

Benefits & expenses:
Losses & policy benefits	$	550,901,417	$	448,396,645	$	102,504,772	22.86	$	2,245,203,172	$	2,076,864,037	$	168,339,135	8.11
Reinsurance recoveries		(18,732,359)		(6,977,995)		(11,754,364)	(168.45)		(117,399,472)		(165,516,591)		48,117,119	29.07
Commissions		152,523,580		150,815,496		1,708,084	1.13		630,269,528		627,048,255		3,221,273	0.51
Other operating expenses		95,572,467		76,263,586		19,308,881	25.32		338,085,073		289,555,517		48,529,556	16.76
Interest expense		13,804,440		12,500,619		1,303,821	10.43		53,116,383		51,484,731		1,631,652	3.17
Taxes, licenses & fees		18,740,629		19,473,480		(732,851)	(3.76)		76,742,883		71,538,216		5,204,667	7.28
Incr deferred acq expense		5,382,897		4,829,527		553,370	(11.46)		(21,359,500)		(18,748,605)		(2,610,895)	(13.93)
Other expenses		4,244,124		377,634		3,866,490	1,023.87		16,342,089		12,319,865		4,022,224	32.65
Total expenses	$	822,437,195	$	705,678,992	$	116,758,203	16.55	$	3,221,000,156	$	2,944,545,425	$	276,454,731	9.39
Income before income taxes	$	172,068,681	$	261,064,298	$	(88,995,617)	(34.09)	$	1,329,112,992	$	822,777,031	$	506,335,961	61.54

Provision for income taxes:
Current operating income	$	36,443,952	$	54,468,304	$	(18,024,352)	(33.09)	$	155,204,170	$	166,470,189	$	11,266,019)	(6.77)
Realized investments gains and losses		4,310,014		7,136,284		(2,826,270)	(39.60)		249,202,156		20,964,114		228,238,042	1,088.71
Deferred		895,839		16,787,609		(15,891,770)	(94.66)		(5,497,770)		33,372,538		(38,870,308)	(116.47)
Total income taxes	$	41,649,805	$	78,392,197	$	(36,742,392)	(46.87)	$	398,908,556	$	220,806,841	$	178,101,715	80.66

Net income	$	130,418,876	$	182,672,101	$	(52,253,225)	(28.60)	$	930,204,436	$	601,970,190	$	328,234,246	54.53
Comprehensive net income	$	416,378,747	$	137,022,076	$	279,356,671	203.88	$	1,025,818,263	$	98,196,296	$	927,621,967	944.66

Operating income	$	122,404,829	$	166,734,193	$	(44,329,364)	(26.59)	$	495,705,299	$	562,218,382	$	(66,513,083)	(11.83)
Net realized investments gains and losses	$	8,014,047	$	15,937,908	$	(7,923,861)	(49.72)	$	434,499,137	$	39,751,808	$	394,747,329	993.03

Net income per share:
Operating income	$	0.71	$	0.95	$	(0.24)	25.26	$	2.86	$	3.21	$	(0.35)	(10.90)
Net realized investments gains and losses		0.04		0.09		(0.05)	(55.56)		2.50		0.23		2.27	986.96
Net income per share (basic)	$	0.75	$	1.04	$	(0.29)	27.88	$	5.36	$	3.44	$	1.92	55.81
Operating income	$	0.70	$	0.94	$	(0.24)	(25.53)	$	2.82	$	3.17	$	(0.35)	(11.04)
Net realized investments gains and losses		0.05		0.09		(0.04)	(44.44)		2.48		0.23		2.25	978.26
Net income per share (diluted)	$	0.75	$	1.03	$	(0.28)	(27.18)	$	5.30	$	3.40	$	1.90	55.88
Dividends per share:
Paid	$	0.335	$	0.305	$	0.03	9.84	$	1,310	$	1,162	$	0.148	12.74
Declared	$	0.335	$	0.305	$	0.03	9.84	$	1,340	$	1,205	$	0.135	11.20
Number of shares:
Weighted avg - basic		173,030,127		174,671,340		(1,641,213)	(0.94)		173,423,395		175,062,669		(1,639,274)	(0.94)
Weighted avg - diluted		174,988,162		177,045,508		(2,057,346)	(1.16)		175,451,341		177,116,126		(1,664,785)	(0.94)

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation and Subsidiaries
Consolidated Statements of Income for the Twelve Months Ended December 31, 2006

		Total		CFC		CIC GROUP		CLIC		CFC-I		CINFIN		ELIM
Revenues:
Premiums earned:
Property casualty	$	3,320,696,134	$	0	$	3,321,610,148	$	0	$	0	$	0	$	(914,014)
Life		152,590,039		0		0		152,590,039		0		0		0
Accident health		6,652,508		0		0		6,652,508		0		0		0
Premiums ceded		(202,091,894)		0		(157,587,693)		(44,504,201)		0		0		0
Total earned premium		3,277,846,787		0		3,164,022,455		114,738,346		0		0		(914,014)
Investment income		570,103,128		97,437,082		367,304,753		107,656,860		62,400		209,379		(2,567,346)
Realized gain on investments		683,701,293		410,338,912		225,846,088		44,861,000		(324,417)		5,697		2,974,013
Other income		18,461,940		10,098,558		3,266,830		3,552,294		11,131,714		2,374,373		(11,961,829)
Total revenues	$	4,550,113,148	$	517,874,552	$	3,760,440,126	$	270,808,500	$	10,869,697	$	2,589,449	$	(12,469,176)

Benefits & expenses:
Losses & policy benefits	$	2,245,203,172	$	0	$	2,085,421,315	$	161,984,990	$	0	$	0	$	(2,203,133)
Reinsurance recoveries		(117,399,472)		0		(77,446,382)		(39,953,090)		0		0		0
Commissions		630,269,528		0		596,188,393		34,081,135		0		0		0
Other operating expenses		338,085,073		19,609,842		292,709,156		31,977,077		5,416,146		626,085		(12,253,233)
Interest expense		53,116,383		50,612,821		888,930		98,000		2,715,584		0		(1,198,952)
Taxes, licenses & fees		76,742,883		1,152,118		72,695,021		3,080,836		(232,648)		47,556		0
Incr deferred acq expenses		(21,359,500)		0		(3,642,356)		(17,717,144)		0		0		0
Other expenses		16,342,089		0		16,341,980		109		0		0		0
Total expenses	$	3,221,000,156	$	71,374,781	$	2,983,156,057	$	173,551,913	$	7,899,082	$	673,641	$	(15,655,318)

Income before income taxes	$	1,329,112,992	$	446,499,771	$	777,284,069	$	97,256,587	$	2,970,615	$	1,915,808	$	3,186,142

Provision for income taxes:
Current operating income	$	155,204,170	$	(178,058)	$	147,254,816	$	6,273,558	$	1,232,459	$	621,395	$	-
Capital gains/losses		249,202,156		153,102,119		80,218,693		15,879,350		0		1,994		0
Deferred		(5,497,770)		(10,819,456)		(8,069,068)		12,406,344		(137,973)		7,233		1,115,150
Total income tax	$	398,908,556	$	142,104,605	$	219,404,441	$	34,559,252	$	1,094,486	$	630,622	$	1,115,150

Net income - current year	$	930,204,436	$	304,395,166	$	557,879,628	$	62,697,335	$	1,876,129	$	1,285,186	$	2,070,992

Net income - prior year	$	601,970,190	$	36,770,595	$	511,573,782	$	47,282,395	$	3,072,943	$	1,206,078	$	2,064,397

Change in net income		54.5%		727.8%		9.1%		32.6%		-38.9%		6.6%

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation and Subsidiaries
Consolidated Statements of Income for the Twelve Months Ended December 31, 2005

		Total		CFC		CIC GROUP		CLIC		CFC-I		CINFIN		ELIM
Revenues:
Premiums earned:
Property casualty	$	3,237,013,369	$	0	$	3,237,519,279	$	0	$	0	$	0	$	(505,910)
Life		143,808,461		0		0		143,808,461		0		0		0
Accident health		6,347,605		0		0		6,347,605		0		0		0
Premiums ceded		(223,269,321)		0		(179,470,542)		(43,798,779)		0		0		0
Total earned premium		3,163,900,114		0		3,058,048,737		106,357,287		0		0		(505,910)
Investment income		525,984,174		89,320,917		337,906,534		99,323,763		816,858		145,299		(1,529,197)
Realized gain on investments		60,715,922		2,139,719		39,965,940		17,188,854		0		(78,963)		1,500,372
Other income		16,722,246		9,843,807		3,100,348		3,561,244		9,913,081		2,251,646		(11,947,880)
Total revenues	$	3,767,322,456	$	101,304,443	$	3,439,021,559	$	226,431,148	$	10,729,939	$	2,317,982	$	(12,482,615)

Benefits & expenses:
Losses & policy benefits	$	2,076,864,037	$	0	$	1,937,904,906	$	141,170,430	$	0	$	0	$	(2,211,299)
Reinsurance recoveries		(165,516,591)		0		(125,974,401)		(39,542,190)		0		0		0
Commissions		627,048,255		0		592,329,261		34,718,994		0		0		0
Other operating expenses		289,555,517		18,826,237		249,373,992		28,592,514		4,088,594		463,774		(11,789,594)
Interest expense		51,484,731		51,606,330		0		0		1,536,119		0		(1,657,718)
Taxes, licenses & fees		71,538,216		919,910		66,678,800		3,205,175		697,083		37,248		0
Incr deferred acq expenses		(18,748,605)		0		(4,700,131)		(14,048,474)		0		0		0
Other expenses		12,319,865		0		12,319,757		108		0		0		0
Total expenses	$	2,944,545,425	$	71,352,477	$	2,727,932,184	$	154,096,557	$	6,321,796	$	501,022	$	(15,658,611)

Income before income taxes	$	822,777,031	$	29,951,966	$	711,089,375	$	72,334,591	$	4,408,143	$	1,816,960	$	3,175,996

Provision for income taxes:
Current operating income	$	166,470,189	$	(27,417,773)	$	178,744,156	$	12,721,453	$	1,793,487	$	628,866	$	-
Capital gains/losses		20,964,114		987,574		13,988,078		6,016,099		0		(27,637)		0
Deferred		33,372,538		19,611,570		6,783,359		6,314,644		(458,287)		9,653		1,111,599
Total income tax	$	220,806,841	$	(6,818,629)	$	199,515,593	$	25,052,196	$	1,335,200	$	610,882	$	1,111,599

Net income - current year	$	601,970,190	$	36,770,595	$	511,573,782	$	47,282,395	$	3,072,943	$	1,206,078	$	2,064,397

Net income - prior year	$	584,021,320	$	81,024,634	$	550,420,421	$	38,180,265	$	1,548,487	$	1,227,691	$	(88,380,178)

Change in net income		3.1%		-54.6%		-7.1%		23.8%		98.4%		-1.8%

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation and Subsidiaries
Consolidated Statements of Income for the Three Months Ended December 31, 2006

		Total		CFC		CIC GROUP		CLIC		CFC-I		CINFIN		ELIM
Revenues:
Premiums earned:
Property casualty	$	844,769,727	$	0	$	845,479,506	$	0	$	0	$	0	$	(709,779)
Life		43,271,070		0		0		43,271,070		0		0		0
Accident health		1,703,987		0		0		1,703,987		0		0		0
Premiums ceded		(57,316,655)		0		(43,501,451)		(13,815,204)		0		0		0
Total earned premium		832,428,129		0		801,978,055		31,159,853		0		0		(709,779)
Investment income		145,070,824		24,550,476		93,654,263		27,053,035		15,600		57,244		(259,793)
Realized gain on investments		12,324,061		1,862,472		7,323,470		2,533,775		217,084		(8,277)		395,537
Other income		4,682,860		2,536,489		723,643		992,375		2,806,674		621,838		(2,998,158)
Total revenues	$	994,505,874	$	28,949,437	$	903,679,431	$	61,739,038	$	3,039,358	$	670,805	$	(3,572,193)

Benefits & expenses:
Losses & policy benefits	$	550,901,417	$	0	$	507,755,637	$	43,696,578	$	0	$	0	$	(550,798)
Reinsurance recoveries		(18,732,359)		0		(5,484,567)		(13,247,792)		0		0		0
Commissions		152,523,580		0		144,113,098		8,410,482		0		0		0
Other operating expenses		95,572,467		4,960,848		80,278,976		12,192,870		1,461,656		230,387		(3,552,270)
Interest expense		13,804,440		12,460,505		496,480		98,000		754,228		0		(4,773)
Taxes, licenses & fees		18,740,630		284,596		17,498,941		935,887		9,316		11,889		0
Incr deferred acq expenses		5,382,898		0		8,862,341		(3,479,444)		0		0		0
Other expenses		4,244,123		0		4,244,123		1		0		0		0
Total expenses	$	822,437,196	$	17,705,949	$	757,765,029	$	48,606,582	$	2,225,200	$	242,276	$	(4,107,841)

Income before income taxes	$	172,068,678	$	11,243,488	$	145,914,402	$	13,132,456	$	814,158	$	428,529	$	535,648

Provision for income taxes:
Current operating income	$	36,443,952	$	3,406,871	$	31,617,921	$	953,701	$	322,879	$	142,580	$	-
Capital gains/losses		4,310,014		661,562		2,703,528		947,821		0		(2,897)		0
Deferred		895,839		(5,331,071)		3,407,423		2,628,721		4,088		(799)		187,477
Total income tax	$	41,649,805	$	(1,262,638)	$	37,728,872	$	4,530,243	$	326,967	$	138,884	$	187,477

Net income - current year	$	130,418,873	$	12,506,126	$	108,185,530	$	8,602,213	$	487,191	$	289,645	$	348,171

Net income - prior year	$	182,672,096	$	9,037,150	$	156,687,048	$	15,812,588	$	421,720	$	298,051	$	415,539

Change in net income		-28.6%		38.4%		-31.0%		-45.6%		15.5%		-2.8%

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation and Subsidiaries
Consolidated Statements of Income for the Three Months Ended December 31, 2005

		Total		CFC		CIC GROUP		CLIC		CFC-I		CINFIN		ELIM
Revenues:
Premiums earned:
Property casualty	$	818,784,982	$	0	$	818,847,338	$	0	$	0	$	0	$	(62,356)
Life		40,421,076		0		0		40,421,076		0		0		0
Accident health		1,617,668		0		0		1,617,668		0		0		0
Premiums ceded		(57,661,922)		0		(43,810,668)		(13,851,254)		0		0		0
Total earned premium		803,161,804		0		775,036,670		28,187,490		0		0		(62,356)
Investment income		135,899,272		25,026,626		87,474,802		26,013,305		18,665		47,970		(2,682,096)
Realized gain on investments		23,074,193		1,296,380		11,828,897		9,832,034		0		315		116,567
Other income		4,608,018		525,388		651,450		1,015,456		2,638,547		562,192		(785,015)
Total revenues	$	966,743,287	$	26,848,394	$	874,991,819	$	65,048,285	$	2,657,212	$	610,477	$	(3,412,900)

Benefits & expenses:
Losses & policy benefits	$	448,396,642	$	0	$	436,006,402	$	12,945,476	$	0	$	0	$	(555,236)
Reinsurance recoveries		(6,977,992)		0		(18,802,810)		11,824,818		0		0		0
Commissions		150,815,497		0		141,873,514		8,941,983		0		0		0
Other operating expenses		76,263,586		3,123,394		63,922,981		10,732,035		1,236,646		145,601		(2,897,071)
Interest expense		12,500,619		12,603,698		0		0		496,806		0		(599,885)
Taxes, licenses & fees		19,473,481		1,498,619		17,660,389		32,729		272,244		9,500		0
Incr deferred acq expenses		4,829,527		0		9,111,122		(4,281,595)		0		0		0
Other expenses		377,634		0		377,634		0		0		0		0
Total expenses	$	705,678,994	$	17,225,711	$	650,149,232	$	40,195,446	$	2,005,696	$	155,101	$	(4,052,192)

Income before income taxes	$	261,064,293	$	9,622,683	$	224,842,587	$	24,852,839	$	651,516	$	455,376	$	639,292

Provision for income taxes:
Current operating income	$	54,468,303	$	(13,445,362)	$	63,736,999	$	3,623,075	$	405,488	$	148,103	$	-
Capital gains/losses		7,136,284		379,862		3,313,516		3,441,212		0		1,694		0
Deferred		16,787,610		13,651,033		1,105,024		1,975,964		(175,692)		7,528		223,753
Total income tax	$	78,392,197	$	585,533	$	68,155,539	$	9,040,251	$	229,796	$	157,325	$	223,753

Net income - current year	$	182,672,096	$	9,037,150	$	156,687,048	$	15,812,588	$	421,720	$	298,051	$	415,539

Net income - prior year	$	192,446,086	$	12,997,334	$	163,551,413	$	14,214,169	$	760,129	$	333,062	$	589,979

Change in net income		-5.1%		-30.5%		-4.2%		11.2%		-44.5%		-10.5%

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation
Consolidated Balance Sheets

(Dollars in millions except per share data)		December 31,		December 31,
		2006		2005
		(unaudited)
Assets
Investments
Fixed maturities, at fair value (amortized cost: 2006—$5,739; 2005—$5,387)	$	5,805	$	5,476
Equity securities, at fair value (cost: 2006—$2,621; 2005—$2,128)		7,799		7,106
Short-term investments, at fair value (amortized cost: 2006—$95; 2005—$75)		95		75
Other invested assets		60		45
Cash and cash equivalents		202		119
Investment income receivable		121		117
Finance receivable		108		105
Premiums receivable		1,128		1,116
Reinsurance receivable		683		681
Prepaid reinsurance premiums		13		14
Deferred policy acquisition costs		453		429
Property and equipment, net, for company use (accumulated depreciation: 2006—$261; 2005—$232)		193		168
Other assets		58		66
Separate accounts		504		486
Total assets	$	17,222	$	16,003

Liabilities
Insurance reserves
Losses and loss expense	$	3,896	$	3,661
Life policy reserves		1,409		1,343
Unearned premiums		1,579		1,559
Other liabilities		533		455
Deferred income tax		1,653		1,622
Notes payable		49		0
6.125% senior debenture due 2034		371		371
6.90% senior debenture due 2028		28		28
6.92% senior debenture due 2028		392		392
Separate accounts		504		486
Total liabilities		10,414		9,917

Shareholders' equity
Common stock, par value-$2 per share; authorized: 2006-500 million shares, 2005- 500 million shares; issued: 2006-196 million shares, 2005-194 million shares		391		389
Paid-in capital		1,015		969
Retained earnings		2,786		2,088
Accumulated other comprehensive income		3,379		3,284
Treasury stock at cost (2006—23 million shares, 2005—20 million shares)		(763)		(644)
Total shareholders' equity		6,808		6,086
Total liabilities and shareholders' equity	$	17,222	$	16,003

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation
10-Year Net Income Reconciliation

(Dollars in millions except per share data)	Years ended December 31,
	2006			2005			2004			2003			2002			2001			2000			1999			1998			1997

Net income	$	930		$	602		$	584		$	374		$	238		$	193		$	118		$	255		$	242		$	299
One-time item		0			0			0			15			0			0			(25)			0			0			0
Net income before one-time item		930			602			584			359			238			193			143			255			242			299
Net realized investment gains and losses		434			40			60			(27)			(62)			(17)			(2)			0			43			45
Operating income before one-time item		496			562			524			386			300			210			145			255			199			254
Less catastrophe losses		(113)			(82)			(96)			(63)			(57)			(42)			(33)			(24)			(61)			(17)
Operating income before catastrophe losses and one-time item	$	609		$	644		$	620		$	449		$	357		$	252		$	178		$	279		$	260		$	271

Diluted per share data
Net income	$	5.30		$	3.40		$	3.28		$	2.10		$	1.32		$	1.07		$	0.67		$	1.37		$	1.28		$	1.61
One-time item		0.00			0.00			0.00			0.09			0.00			0.00			(0.14)			0.00			0.00			0.00
Net income before one-time item		5.30			3.40			3.28			2.01			1.32			1.07			0.81			1.37			1.28			1.61
Net realized investment gains and losses		2.48			0.23			0.34			(0.15)			(0.35)			(0.10)			(0.01)			0.00			0.23			0.26
Operating income before one-time item		2.82			3.17			2.94			2.16			1.67			1.17			0.82			1.37			1.05			1.35
Less catastrophe losses		(0.65)			(0.46)			(0.54)			(0.35)			(0.31)			(0.23)			(0.18)			(0.13)			(0.32)			(0.13)
Operating income before catastrophe losses and one-time item	$	3.47		$	3.63		$	3.48		$	2.51		$	1.98		$	1.40		$	1.00		$	1.50		$	1.37		$	1.49

Return on equity
Return on average equity		14.4	%		9.8	%		9.4	%		6.3	%		4.1	%		3.2	%		2.1	%		4.6	%		4.7	%		7.6	%
One-time item		0.0			0.0			0.0			(0.3)			0.0			0.0			0.4			0.0			0.0			0.0
Return on average equity before one-time item		14.4	%		9.8	%		9.4	%		6.0	%		4.1	%		3.2	%		2.5	%		4.6	%		4.7	%		7.6	%

Return on equity based on comprehensive income
ROE based on comprehensive income		15.9	%		1.6	%		4.6	%		13.8	%		(4.0)	%		2.5	%		13.1	%		1.9	%		19.6	%		42.6	%
One-time item		0.0			0.0			0.0			(0.3)			0.0			0.0			0.4			0.0			0.0			0.0
ROE based on comprehensive income before one-time item		15.9	%		1.6	%		4.6	%		13.5	%		(4.0)	%		2.5	%		13.5	%		1.9	%		19.6	%		42.6	%

Investment income, net of expenses	$	570		$	526		$	492		$	465		$	445		$	421		$	415		$	387		$	368		$	349
BOLI		0			0			0			0			0			0			(5)			0			0			0
Investment income before BOLI	$	570		$	526		$	492		$	465		$	445		$	421		$	410		$	387		$	368		$	349

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation
Quarterly Net Income Reconciliation

(In millions except per share data)	Three months ended																Six months ended				Nine months ended				Twelve months ended
	12/31/06		9/30/06		6/30/06		3/31/06		12/31/05		9/30/05		6/30/05		3/31/05		6/30/06		6/30/05		9/30/06		9/30/05		12/31/06		12/31/05

Net income	$	130	$	115	$	132	$	552	$	183	$	117	$	158	$	144	$	684	$	302	$	800	$	419	$	930	$	602
One-time item		0		0		0		0		0		0		0		0		0		0		0		0		0		0
Net income before one-time item		130		115		132		552		183		117		158		144		684		302		800		419		930		602
Net realized investment gains and losses		8		0		6		421		16		10		8		6		426		14		427		24		434		40
Operating income before one-time item		122		115		126		131		167		107		150		138		258		288		373		395		496		562
Less catastrophe losses		(29)		(18)		(41)		(26)		(28)		(43)		(9)		(2)		(67)		(11)		(85)		(54)		(113)		(82)
Operating income before catastrophe losses and one-time item	$	151	$	133	$	167	$	157	$	195	$	150	$	159	$	140	$	325	$	299	$	458	$	449	$	609	$	644

Diluted per share data
Net income	$	0.75	$	0.66	$	0.76	$	3.13	$	1.03	$	0.66	$	0.89	$	0.81	$	3.90	$	1.70	$	2.13	$	2.37	$	5.30	$	3.40
One-time item		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00		0.00
Net income before one-time item		0.75		0.66		0.76		3.13		1.03		0.66		0.89		0.81		3.90		1.70		2.13		2.37		5.30		3.40
Net realized investment gains and losses		0.05		0.00		0.04		2.39		0.09		0.05		0.05		0.03		2.43		0.08		2.43		0.14		2.48		0.23
Operating income before one-time item		0.70		0.66		0.72		0.74		0.94		0.61		0.84		0.78		1.47		1.62		4.56		2.23		2.82		3.17
Less catastrophe losses		(0.16)		(0.10)		(0.24)		(0.14)		(0.16)		(0.24)		(0.05)		(0.01)		(0.38)		(0.06)		(0.48)		(0.30)		(0.65)		(0.46)
Operating income before catastrophe losses and one-time item	$	0.86	$	0.76	$	0.96	$	0.88	$	1.10	$	0.85	$	0.89	$	0.79	$	1.85	$	1.68	$	5.04	$	2.53	$	3.47	$	3.63

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.

2006 Fourth-Quarter Supplement


Cincinnati Financial Corporation
Top Holdings – Common Stocks

(Dollars in millions)	As of and for the year ended December 31, 2006
	Actual cost		Fair value		Percent of fair value		Earned dividend income


Fifth Third Bancorp	$	283	$	2,979	39.4	%	$	115
Exxon Mobil Corporation		133		687	9.1			11
The Procter & Gamble Company		192		469	6.2			8
National City Corporation		171		358	4.7			15
PNC Financial Services Group, Inc.		62		348	4.6			10
AllianceBernstein Holding L.P.		60		266	3.5			12
U.S. Bancorp		150		251	3.3			9
Johnson & Johnson		194		238	3.1			5
Wyeth		62		225	3.0			4
Wells Fargo & Company		96		193	2.5			6
Piedmont Natural Gas Company, Inc.		64		151	2.0			5
Sky Financial Group, Inc.		91		133	1.8			4
FirstMerit Corporation		55		129	1.7			6
All other common stock holdings		789		1,137	15.1			31
Total	$	2,402	$	7,564	100.0	%	$	241

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
GAAP Statements of Income

		For the Three Months Ended December 31,							For the Twelve Months Ended December 31,
		2006		2005		Change	% Change		2006		2005		Change	% Change
Revenues:
Premiums earned:
Property casualty	$	845,479,506	$	818,847,338	$	26,632,168	3.25	$	3,321,610,148	$	3,237,519,279	$	84,090,869	2.60
Life		0		0		0	NA		0		0		0	NA
Accident health		0		0		0	NA		0		0		0	NA
Premiums ceded		(43,501,451)		(43,810,668)		309,217	0.71		(157,587,693)		(179,470,542)		21,882,849	12.19
Total premiums earned		801,978,055		775,036,670		26,941,385	3.48		3,164,022,455		3,058,048,737		105,973,718	3.47
Investment income		93,654,263		87,474,802		6,179,461	7.06		367,304,753		337,906,534		29,398,219	8.70
Realized gain on investments		7,323,470		11,828,897		(4,505,427)	(38.09)		225,846,088		39,965,940		185,880,148	465.10
Other income		723,643		651,450		72,193	11.08		3,266,830		3,100,348		166,482	5.37
Total revenues	$	903,679,431	$	874,991,819	$	28,687,612	3.28	$	3,760,440,126	$	3,439,021,559	$	321,418,567	9.35

Benefits & expenses:
Losses & policy benefits	$	507,755,637	$	436,006,402	$	71,749,235	16.46	$	2,085,421,315	$	1,937,904,906	$	147,516,409	7.61
Reinsurance recoveries		(5,484,567)		(18,802,810)		13,318,243	70.83		(77,446,382)		(125,974,401)		48,528,019	38.52
Commissions		144,113,098		141,873,514		2,239,584	1.58		596,188,393		592,329,261		3,859,132	0.65
Other operating expenses		80,278,976		63,922,981		16,355,995	25.59		292,709,156		249,373,992		43,335,164	17.38
Interest expense		496,480		0		496,480	NA		888,930		0		888,930	NA
Taxes, licenses & fees		17,498,941		17,660,389		(161,448)	(0.91)		72,695,021		66,678,800		6,016,221	9.02
Incr deferred acq expense		8,862,341		9,111,122		(248,781)	(2.73)		(3,642,356)		(4,700,131)		1,057,775	22.51
Other expenses		4,244,123		377,634		3,866,489	1,023.87		16,341,980		12,319,757		4,022,223	32.65
Total expenses	$	757,765,029	$	650,149,232	$	107,615,797	16.55	$	2,983,156,057	$	2,727,932,184	$	255,223,873	9.36
Income before income taxes	$	145,914,402	$	224,842,587	$	(78,928,185)	(35.10)	$	777,284,069	$	711,089,375	$	66,194,694	9.31

Provision for income taxes:
Current operating income	$	31,617,921	$	63,736,999	$	(32,119,078)	(50.39)	$	147,254,816	$	178,744,156	$	(31,489,340)	(17.62)
Current realized investments gains and losses		2,703,528		3,313,516		(609,988)	(18.41)		80,218,693		13,988,078		66,230,615	473.48
Deferred		3,407,423		1,105,024		2,302,399	208.36		(8,069,068)		6,783,359		(14,852,427)	(218.95)
Total income taxes	$	37,728,872	$	68,155,539	$	(30,426,667)	(44.64)	$	219,404,441	$	199,515,593	$	19,888,848	9.97

Net income	$	108,185,530	$	156,687,048	$	(48,501,518)	(30.95)	$	557,879,628	$	511,573,782	$	46,305,846	9.05

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Statutory Statements of Income

		For the Three Months Ended December 31,					For the Twelve Months Ended December 31,
		2006		2005	% Change		2006		2005	% Change
Underwriting income
Net premiums written	$	755,245,797	$	727,352,851	3.83	$	3,178,105,582	$	3,076,183,237	3.31
Unearned premiums increase		(46,732,257)		(47,683,819)			14,083,124		18,134,500
Earned premiums		801,978,054		775,036,669	3.48		3,164,022,457		3,058,048,736	3.47

Losses incurred	$	379,133,413	$	347,956,479	8.96	$	1,640,711,403	$	1,505,591,684	8.97
Allocated loss expenses incurred		71,979,236		24,759,130	190.72		183,420,723		140,414,792	30.63
Unallocated loss expenses incurred		51,158,422		44,487,984	14.99		183,842,807		165,924,030	10.80
Other underwriting expenses incurred		246,289,916		229,664,309	7.24		948,113,154		904,044,693	4.87
Workers compensation dividend incurred		5,135,756		2,929,147	75.33		17,343,175		10,419,002	66.46

Total underwriting deductions	$	753,696,744	$	649,797,049	15.99	$	2,973,431,262	$	2,726,394,200	9.06
Net underwriting gain (loss)	$	48,281,310	$	125,239,621	(61.45)	$	190,591,195	$	331,654,536	(42.53)

Investment income
Gross investment income earned	$	94,867,708	$	88,574,194	7.11	$	371,912,860	$	342,027,603	8.74
Net investment income earned		93,654,263		87,474,802	7.06		367,304,753		337,906,533	8.70
Net realized capital gains		4,677,265		5,480,142	(14.65)		146,526,143		37,239,021	293.47
Net investment gains (excl. subs)	$	98,331,529	$	92,954,945	5.78	$	513,830,897	$	375,145,555	36.97
Dividend from subsidiary		12,000,000					26,000,000
Net investment gains	$	110,331,529	$	92,954,945	18.69	$	539,830,897	$	375,145,555	43.90


Other income	$	618,259	$	(192,707)	N/A	$	2,488,123	$	(2,195,078)	N/A

Net income before federal income taxes	$	159,231,098	$	218,001,858	(26.96)	$	732,910,214	$	704,605,013	4.02
Federal and foreign income taxes incurred	$	30,398,414	$	46,998,734	(35.32)	$	143,561,772	$	172,680,453	(16.86)
Net income (statutory)	$	128,832,684	$	171,003,124	(24.66)	$	589,348,442	$	531,924,560	10.80

* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate
regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group - Consolidated
Statutory Quarterly Analysis
(Based on reported data – see Page 25 for adjusted data)

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06		12/31/05
Net premiums written	$	755		$	780		$	814		$	829		$	727		$	761		$	791		$	797		$	1,643		$	1,588		$	2,423		$	2,349		$	3,178		$	3,076
Net premiums earned	$	802		$	791		$	793		$	778		$	775		$	765		$	765		$	753		$	1,571		$	1,518		$	2,362		$	2,283		$	3,164		$	3,058

Losses paid	$	375		$	366		$	379		$	346		$	378		$	348		$	336		$	345		$	727			681		$	1,094		$	1,029		$	1,469		$	1,407
Loss reserve change		4			66			60			42			(30)			72			23			33			101			57			167			129			172			99
Total losses incurred	$	379		$	433		$	439		$	388		$	348		$	420		$	359		$	378		$	828		$	738		$	1,261		$	1,158		$	1,641		$	1,506
Allocated loss expense paid		37			33			31			27			32			30			29			25			59			54			91			84			127			116
Allocated loss expense reserve change		35			8			7			6			(7)			10			11			11			13			21			20			31			56			24
Total allocated loss expense incurred	$	72		$	41		$	38		$	33		$	25		$	40		$	40		$	36		$	72		$	75		$	111		$	115		$	183		$	140
Unallocated loss expense paid		49			39			39			40			46			38			37			34			78			71			117			108			167			155
Unallocated loss expense reserve change		2			4			3			10			(2)			3			0			10			12			10			15			13			17			11
Total unallocated loss expense incurred	$	51		$	43		$	42		$	50		$	44		$	41		$	37		$	44		$	90		$	81		$	132		$	121		$	184		$	166
Underwriting expenses incurred		251			243			232			240			233			237			234			212			471			446			715			682			965			914
Underwriting profit (loss)	$	49		$	31		$	42		$	67		$	125		$	27		$	95		$	83		$	110		$	178		$	143		$	207		$	191		$	332

Loss Detail
Losses $1 million or more	$	63		$	61		$	46		$	32		$	38		$	27		$	28		$	43		$	79		$	70		$	139		$	98		$	203		$	137
Losses $250 thousand to $1 million		43			49			48			38			36			35			37			32			86			69			135			104			178			139
Development and case reserve increases of $250,000 or more		64			49			52			49			54			38			40			36			102			76			151			115			215			168
Large losses subtotal	$	170		$	159		$	146		$	119		$	128		$	100		$	105		$	111		$	267		$	215		$	425		$	317		$	596		$	444
IBNR incurred		(57)			11			(5)			6			(58)			20			13			13			1			27			11			47			(47)			(11)
Catastrophe losses incurred		44			27			64			40			44			66			14			2			103			17			131			83			175			127
Remaining incurred		222			235			234			223			234			233			226			252			457			478			694			711			917			946
Total losses incurred	$	379		$	432		$	439		$	388		$	348		$	419		$	358		$	378		$	828		$	737		$	1,261		$	1,158		$	1,641		$	1,506

Ratio Data
Loss ratio		47.2	%		54.8	%		55.4	%		50.0	%		44.9	%		54.9	%		46.9	%		50.3	%		52.7	%		48.6	%		53.4	%		50.7	%		51.9			49.2	%
Allocated loss expense ratio		9.0			5.0			4.8			4.3			3.2			5.3			5.2			4.7			4.6			5.0			4.7			5.1			5.8			4.6
Unallocated loss expense ratio		6.4			5.4			5.1			6.4			5.7			5.3			4.8			5.8			5.7			5.3			5.6			5.3			5.8			5.4
Net underwriting expense ratio		33.3			31.2			28.4			28.9			32.0			31.1			29.6			26.6			28.7			28.0			29.5			29.0			30.4			29.7
Statutory combined ratio		95.9	%		96.4	%		93.7	%		89.6	%		85.8	%		96.6	%		86.5	%		87.4	%		91.7	%		86.9	%		93.2	%		90.1	%		93.9			88.9	%
Statutory combined ratio excluding catastrophes		90.4	%		92.9	%		85.7	%		84.6	%		80.2	%		88.0	%		84.6	%		87.1	%		85.1	%		85.8	%		87.7	%		86.5	%		88.4			84.9	%

Loss Ratio
Losses $1 million or more		7.9	%		7.6	%		6.0	%		4.2	%		5.0	%		3.6	%		3.6	%		5.7	%		5.1	%		4.7	%		5.9	%		4.3	%		6.4	%		4.5	%
Losses $250 thousand to $1 million		5.3			6.2			6.0			4.9			4.5			4.6			4.8			4.3			5.5			4.5			5.7			4.5			5.6			4.5
Development and case reserve increases of $250,000 or more		8.0			6.3			7.4			6.4			6.9			5.1			5.2			4.7			6.9			5.0			6.4			5.0			6.8			5.5
Large losses subtotal		21.2	%		20.1	%		19.4	%		15.5	%		16.4	%		13.3	%		13.6	%		14.7	%		17.5	%		14.2	%		18.0	%		13.8	%		18.8	%		14.5	%
IBNR incurred		(7.2)			1.3			1.3			0.8			(7.4)			2.5			1.8			1.8			1.1			1.8			0.5			2.0			(1.4)			(0.4)
Total catastrophe losses incurred		5.5			3.5			8.0			5.0			5.6			8.6			1.9			0.3			6.5			1.1			5.5			3.6			5.5			4.1
Remaining incurred		27.7			29.9			26.7			28.6			30.3			30.6			29.6			33.5			27.6			31.5			29.4			31.2			29.0			31.0
Total loss ratio		47.2	%		54.8	%		55.4	%		49.9	%		44.9	%		55.0	%		46.9	%		50.3	%		52.7	%		48.6	%		53.4	%		50.6	%		51.9	%		49.2	%

Loss Claim Count
Losses $1 million or more		33			32			26			14			24			21			17			15			40			32			72			53			105			77
Losses $250 thousand to $1 million		97			103			88			95			92			81			93			73			183			166			286			247			383			339
Development and case reserve increases of $250,000 or more		94			104			85			85			100			72			61			67			170			128			274			200			368			300
Large losses total		224			239			199			194			216			174			171			155			393			326			632			500			856			716
Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.
NM – Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed by the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group - Commercial Lines
Statutory Quarterly Analysis
(Based on reported data - see Page 26 for adjusted data)
(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06		12/31/05
Net premiums written	$	589		$	582		$	603		$	668		$	548		$	546		$	567		$	629		$	1,271		$	1,195		$	1,853		$	1,741		$	2,442		$	2,290
Net premiums earned	$	619		$	602		$	599		$	582		$	576		$	564		$	563		$	551		$	1,181		$	1,114		$	1,783		$	1,678		$	2,402		$	2,254

Losses paid	$	256		$	247		$	251		$	234		$	256		$	228		$	214		$	219		$	485		$	434		$	732		$	662		$	988		$	918
Loss reserve change		5			63			53			53			(19)			67			32			51			105			84			168			151			174			132
Total losses incurred	$	261		$	310		$	304		$	287		$	237		$	295		$	246		$	270		$	590		$	518		$	900		$	813		$	1,162		$	1,050
Allocated loss expense paid		33			30			28			24			28			27			26			22			52			48			81			75			114			103
Allocated loss expense reserve change		37			7			6			5			(1)			9			10			10			12			20			19			29			56			28
Total allocated loss expense incurred	$	70		$	37		$	34		$	29		$	27		$	36		$	36		$	32		$	64		$	68		$	100		$	104		$	170		$	131
Unallocated loss expense paid		34			27			27			28			31			26			25			22			54			48			81			73			116			105
Unallocated loss expense reserve change		3			3			3			10			(1)			3			1			10			13			11			15			13			18			12
Total unallocated loss expense incurred	$	37		$	30		$	30		$	38		$	30		$	29		$	26		$	32		$	67		$	59		$	96		$	86		$	134		$	117
Underwriting expenses incurred		194			185			172			179			182			173			165			156			349			321			536			493			727			675
Underwriting profit (loss)	$	57		$	40		$	59		$	49		$	100		$	31		$	90		$	61		$	111		$	148		$	151		$	182		$	209		$	281

Loss Detail
Losses $1 million or more	$	59		$	51		$	40		$	30		$	31		$	24		$	26		$	43		$	70		$	68		$	121		$	93		$	180		$	124
Losses $250 thousand to $1 million		35			37			39			28			28			26			29			22			67			51			104			77			139			105
Development and case reserve increases of $250,000 or more		58			45			45			44			47			35			38			29			90			67			135			103			193			149
Large losses subtotal	$	152		$	133		$	124		$	102		$	106		$	85		$	93		$	94		$	227		$	186		$	360		$	273		$	512		$	378
IBNR incurred		(45)			10			(6)			6			(36)			17			12			12			0			24			10			41			(36)			6
Catastrophe losses incurred		11			14			34			30			14			53			2			6			63			9			77			62			89			76
Remaining incurred		143			153			152			149			153			139			139			159			300			298			453			437			597			590
Total losses incurred	$	261		$	310		$	304		$	287		$	237		$	294		$	246		$	271		$	590		$	517		$	900		$	813		$	1,162		$	1,050

Ratio Data
Loss ratio		42.2	%		51.5	%		50.7	%		49.2	%		41.1	%		52.4	%		43.8	%		49.1	%		50.0	%		46.5	%		50.5	%		48.4	%		48.4	%		46.6	%
Allocated loss expense ratio		11.3			6.0			5.7			5.1			4.7			6.5			6.4			5.8			5.4			6.1			5.6			6.2			7.1			5.8
Unallocated loss expense ratio		6.0			5.0			4.9			6.5			5.3			5.1			4.6			5.9			5.7			5.2			5.4			5.2			5.5			5.2
Net underwriting expense ratio		32.9			31.6			28.3			26.8			33.2			31.6			29.1			24.7			27.5			26.8			28.8			28.3			29.8			29.5
Statutory combined ratio		92.4	%		94.1	%		89.6	%		87.6	%		84.3	%		95.6	%		83.9	%		85.5	%		88.6	%		84.6	%		90.3	%		88.1	%		90.8	%		87.1	%
Statutory combined ratio excluding catastrophes		90.5	%		91.7	%		84.0	%		82.5	%		81.9	%		86.0	%		83.5	%		84.4	%		83.3	%		83.8	%		86.0	%		84.5	%		87.1	%		83.7	%

Loss Ratio
Losses $1 million or more		9.6	%		8.5	%		6.6	%		5.2	%		5.4	%		4.3	%		4.5	%		7.8	%		5.9	%		6.1	%		6.8	%		5.5	%		7.5	%		5.5	%
Losses $250 thousand to $1 million		5.6			6.1			6.5			4.8			4.8			4.7			5.2			3.9			5.7			4.5			5.8			4.6			5.8			4.7
Development and case reserve increases of $250,000 or more		9.4			7.5			7.6			7.6			8.1			6.3			6.8			5.3			7.6			6.0			7.6			6.1			8.0			6.6
Large losses subtotal		24.6	%		22.1	%		20.7	%		17.6	%		18.3	%		15.3	%		16.5	%		17.0	%		19.2	%		16.6	%		20.2	%		16.2	%		21.3	%		16.8	%
IBNR incurred		(7.3)			1.7			(1.0)			1.0			(6.1)			2.9			2.2			2.2			0.0			2.2			0.6			2.4			(1.5)			0.2
Total catastrophe losses incurred		1.9			2.3			5.6			5.1			2.4			9.5			0.4			1.1			5.3			0.8			4.3			3.7			3.7			3.4
Remaining incurred		23.0			25.4			25.4			25.6			26.5			24.7			24.7			28.8			25.5			26.8			25.4			26.1			24.9			26.2
Total loss ratio		42.2	%		51.5	%		50.7	%		49.3	%		41.1	%		52.4	%		43.8	%		49.1	%		50.0	%		46.4	%		50.5	%		48.4	%		48.4	%		46.6	%
Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.
NM - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group - Personal Lines
Statutory Quarterly Analysis
(Based on reported data - see Page 27 for adjusted data)

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06		12/31/05
Net premiums written	$	166		$	198		$	211		$	161		$	179		$	215		$	224		$	168		$	372		$	393		$	570		$	608		$	736		$	786
Net premiums earned	$	183		$	189		$	194		$	196		$	199		$	201		$	202		$	202		$	390		$	404		$	579		$	605		$	762		$	804

Losses paid	$	119		$	119		$	128		$	112		$	122		$	120		$	122		$	126		$	242		$	247		$	362		$	367		$	481		$	489
Loss reserve change		(1)			3			7			(11)			(11)			5			(9)			(18)			(4)			(27)			(1)			(22)			(2)			(33)
Total losses incurred	$	118		$	122		$	135		$	101		$	111		$	125		$	113		$	108		$	238		$	220		$	361		$	345		$	479		$	456
Allocated loss expense paid		4			3			3			3			4			3			3			3			7			6			10			9			13			13
Allocated loss expense reserve change		(2)			1			1			1			(6)			1			1			1			1			1			1			2			0			(4)
Total allocated loss expense incurred	$	2		$	4		$	4		$	4		$	(2)		$	4		$	4		$	4		$	8		$	7		$	11		$	11		$	13		$	9
Unallocated loss expense paid		15			12			12			12			15			12			12			12			24			23			36			35			51			50
Unallocated loss expense reserve change		(1)			1			0			0			(1)			0			(1)			0			(1)			(1)			0			0			(1)			(1)
Total unallocated loss expense incurred	$	14		$	13		$	12		$	12		$	14		$	12		$	11		$	12		$	23		$	22		$	36		$	35		$	50		$	49
Underwriting expenses incurred		57			58			60			61			51			64			69			56			122			125			179			189			238			239
Underwriting profit (loss)	$	(8)		$	(8)		$	(17)		$	18		$	25		$	(4)		$	5		$	22		$	(1)		$	30		$	(8)		$	25		$	(18)		$	51

Loss Detail
Losses $1 million or more	$	4		$	10		$	6		$	2		$	7		$	3		$	2		$	0		$	9		$	2		$	18		$	5		$	23		$	13
Losses $250 thousand to $1 million		8			12			9			10			8			9			8			10			19			18			31			27			39			34
Development and case reserve increases of $250,000 or more		6			4			7			5			7			3			2			7			12			9			16			12			22			19
Large losses subtotal	$	18		$	26		$	22		$	17		$	22		$	15		$	12		$	17		$	40		$	29		$	65		$	44		$	84		$	66
IBNR incurred		(12)			1			1			0			(22)			3			1			1			1			3			1			6			(11)			(17)
Catastrophe losses incurred		33			13			30			10			30			13			12			(4)			40			8			54			21			86			51
Remaining incurred		79			82			82			74			81			94			87			93			157			180			241			274			320			356
Total losses incurred	$	118		$	122		$	135		$	101		$	111		$	125		$	112		$	107		$	238		$	220		$	361		$	345		$	479		$	456

Ratio Data
Loss ratio		64.4	%		65.1	%		70.0	%		52.2	%		55.9	%		62.2	%		55.6	%		53.3	%		61.1	%		54.4	%		62.4	%		57.0	%		62.9	%		56.7	%
Allocated loss expense ratio		1.2			1.9			2.1			1.7			(1.2)			2.0			1.8			1.8			1.9			1.8			2.0			1.9			1.7			1.1
Unallocated loss expense ratio		7.8			6.6			5.8			6.2			7.0			6.1			5.5			5.7			6.0			5.6			6.1			5.8			6.6			6.1
Net underwriting expense ratio		34.3			30.4			28.5			38.0			28.4			29.7			30.7			33.2			32.6			31.8			31.8			31.0			32.4			30.4
Statutory combined ratio		107.7	%		104.0	%		106.4	%		98.1	%		90.1	%		100.0	%		93.6	%		94.0	%		101.6	%		93.6	%		102.3	%		95.7	%		103.6	%		94.3	%
Statutory combined ratio excluding catastrophes		89.8	%		96.9	%		90.8	%		93.1	%		75.2	%		93.6	%		87.4	%		96.0	%		91.3	%		91.5	%		93.1	%		92.2	%		92.3	%		88.0	%

Loss Ratio
Losses $1 million or more		2.2	%		5.0	%		3.5	%		1.2	%		3.6	%		1.5	%		1.1	%		0.0	%		2.3	%		0.6	%		3.2	%		0.9	%		3.0	%		1.6	%
Losses $250 thousand to $1 million		4.5			6.4			4.4			5.3			3.9			4.3			3.7			5.2			4.9			4.4			5.4			4.4			5.2			4.3
Development and case reserve increases of $250,000 or more		3.4			2.1			3.5			2.7			3.5			1.7			1.0			3.2			3.1			2.1			2.8			2.0			2.9			2.4
Large losses subtotal		10.1	%		13.5	%		11.4	%		9.2	%		11.0	%		7.5	%		5.8	%		8.4	%		10.3	%		7.1	%		11.4	%		7.3	%		11.1	%		8.3	%
IBNR incurred		(6.8)			0.1			0.7			0.0			(11.2)			1.4			0.6			0.7			0.3			0.7			0.3			0.9			(1.5)			(2.1)
Total catastrophe losses incurred		17.9			7.1			15.6			5.0			14.9			6.2			6.2			(2.0)			10.3			2.1			9.2			3.5			11.3			6.3
Remaining incurred		43.2			44.4			42.3			38.0			41.2			46.9			42.9			46.2			40.2			44.5			41.5			45.3			42.0			44.3
Total loss ratio		64.4	%		65.1	%		70.0	%		52.2	%		55.9	%		62.0	%		55.5	%		53.3	%		61.1	%		54.4	%		62.4	%		57.0	%		62.9	%		56.8	%
Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.
NM – Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed by the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Direct Written Premiums by Line of Business for the Twelve Months Ended December 31, 2006
(Dollars in millions)
																					12/31/2006		12/31/2005
		Comm		Comm	Comm			Workers'	Specialty		Surety &			Mach. &	Pers		Home		Other		Agency		Agency		Change
State		Casualty		Prop	Auto			Comp	Packages		Exec Risk			Equip	Auto		Owner		Personal		Direct		Direct		%

AL	$	20.1	$	14.1	$	8.3	$	1.4	$	7.0	$	1.6	$	0.6	$	15.6	$	21.1	$	4.4	$	94.2	$	91.7	2.7
AZ		12.5		5.5		9.3		0.5		1.0		0.6		0.5		0.0		0.1		0.1		30.1		26.5	13.6
AR		11.3		9.9		6.6		5.7		3.7		1.1		0.4		2.8		3.0		0.8		45.3		44.9	1.0
DE		0.8		0.4		0.7		1.6		0.0		0.1		0.0		0.0		0.0		0.1		3.7		0.9	293.7
FL		38.1		23.4		13.2		3.4		4.0		2.4		0.7		12.6		20.0		3.7		121.5		106.7	13.8
GA		27.4		20.3		18.7		12.2		6.2		6.8		0.7		31.7		26.7		6.5		157.2		144.8	8.6
ID		7.2		3.5		4.6		0.0		0.9		0.6		0.2		0.0		0.0		0.0		17.0		14.6	16.5
IL		82.3		47.2		34.6		64.2		13.0		8.2		2.9		25.8		19.2		5.9		303.3		300.6	0.9
IN		51.2		39.4		26.9		32.0		7.8		6.8		2.2		29.7		27.0		6.9		229.9		230.0	0.0
IA		21.5		15.0		9.9		23.2		4.3		2.5		1.3		4.8		4.5		2.1		89.1		88.4	0.7
KS		6.9		7.3		4.7		6.2		2.8		1.3		0.4		5.2		6.4		1.2		42.4		40.9	3.7
KY		21.1		18.4		14.8		4.1		4.9		2.9		0.9		20.5		14.7		3.9		106.2		107.8	(1.5)
MD		14.3		5.9		10.8		11.5		1.0		1.5		0.3		0.0		1.3		0.5		47.1		40.3	16.8
MI		43.2		27.1		19.6		21.4		13.0		5.4		1.8		14.3		17.0		3.5		166.3		172.3	(3.5)
MN		27.7		15.9		10.1		7.7		3.7		2.3		1.2		7.3		5.7		2.9		84.5		85.6	(1.3)
MO		26.0		18.9		12.6		17.5		5.2		2.0		1.1		3.2		4.9		1.0		92.4		84.3	9.6
MT		13.2		6.7		7.1		0.0		0.8		0.3		0.3		0.1		0.1		0.0		28.6		26.1	9.6
NE		7.7		5.6		3.8		9.0		1.6		0.9		0.5		1.4		1.3		0.2		32.0		33.4	(4.2)
NH		2.9		2.0		1.4		2.4		0.8		0.5		0.2		0.9		0.7		0.3		12.1		11.5	5.0
NY		26.7		6.8		9.6		2.5		1.1		3.3		0.4		0.0		0.0		0.0		50.4		43.8	14.9
NC		42.1		28.9		25.0		26.7		11.6		8.0		1.4		1.3		1.6		2.7		149.3		133.0	12.2
ND		3.9		3.2		2.5		0.0		0.8		0.6		0.2		0.7		0.6		0.1		12.6		14.0	(9.9)
OH		168.8		101.0		80.1		(0.3)		20.8		25.5		4.7		143.8		93.6		30.3		668.3		692.5	(3.5)
PA		48.8		29.8		30.7		53.8		9.3		6.7		1.7		8.4		6.3		3.1		198.6		195.1	1.8
SC		14.6		9.1		9.4		4.6		2.3		3.1		0.3		0.0		0.0		0.3		43.7		41.4	5.5
SD		4.5		2.7		2.0		3.8		0.5		0.4		0.1		0.0		0.0		0.2		14.2		12.2	16.5
TN		25.7		17.2		16.3		12.6		8.3		4.4		1.0		8.0		8.2		2.6		104.3		98.1	6.4
UT		8.9		3.4		4.1		0.1		0.4		1.3		0.3		0.0		0.0		0.0		18.5		13.0	42.5
VT		5.2		3.7		3.0		7.0		1.0		0.7		0.2		0.9		0.9		0.2		22.8		21.9	4.3
VA		37.3		25.7		24.4		22.7		5.0		5.2		1.1		10.6		8.4		2.9		143.3		132.6	8.0
WV		9.3		6.0		6.5		0.0		2.3		0.7		0.4		0.0		0.9		0.2		26.3		24.3	8.2
WI		31.1		18.2		13.8		25.3		4.7		2.4		1.6		10.5		8.1		3.3		119.0		121.2	(1.7)
All Other		5.7		3.4		3.3		4.9		0.2		1.3		0.2		0.0		0.1		0.2		19.3		15.3	24.7

Total Agency Direct	$	868.0	$	545.6	$	448.4	$	387.7	$	150.0	$	111.4	$	29.8	$	360.1	$	302.4	$	90.1	$	3,293.5	$	3,209.8	2.6
Other Direct		1.2		1.9		0.8		9.4		0.3		0.0		0.0		1.0		2.3		1.8		18.6		21.5	(13.8)
Total Direct	$	869.2	$	547.5	$	449.2	$	397.1	$	150.3	$	111.4	$	29.8	$	361.1	$	304.7	$	91.9	$	3,312.1	$	3,231.3	2.5

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Quarterly Property Casualty Data - By Commercial Lines of Business

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Commercial casualty:
Written premiums	$	204		$	196		$	209		$	228		$	189		$	183		$	193		$	217		$	437		$	409		$	634		$	593		$	838		$	779
Earned premiums		219			207			208			197			195			193			192			183			405			375			613			566		S	831			759
Loss and loss expense ratio		58.8	%		49.4	%		51.8	%		51.3	%		5.1	%		49.3	%		54.3	%		51.2	%		51.6	%		53.0	%		50.8	%		51.8	%		53.0	%		39.8	%
Less catastrophe loss ratio		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Loss and loss expense excluding catastrophe loss ratio		58.8	%		49.4	%		51.8	%		51.3	%		5.1	%		49.3	%		54.3	%		51.2	%		51.6	%		53.0	%		50.8	%		51.8	%		53.0	%		39.8	%

Commercial property:
Written premiums	$	124		$	126		$	122		$	134		$	115		$	113		$	122		$	126		$	256		$	248		$	381		$	361		$	505		$	476
Earned premiums		123			123			123			121			120			113			118			116			244			234			367		$	347			491			467
Loss and loss expense ratio		47.0	%		54.9	%		55.8	%		72.6	%		52.8	%		94.3	%		42.4	%		68.8	%		64.2	%		55.5	%		61.0	%		68.2	%		57.5	%		64.2	%
Less catastrophe loss ratio		7.1			9.9			15.9			22.7			11.2			44.0			1.2			4.0			19.3			2.6			16.1			16.1			13.9			14.9
Loss and loss expense excluding catastrophe loss ratio		39.9	%		45.0	%		39.9	%		49.9	%		41.6	%		50.3	%		41.2	%		64.8	%		44.9	%		52.9	%		44.9	%		52.1	%		43.6	%		49.3	%

Commercial auto:
Written premiums	$	105		$	105		$	115		$	126		$	107		$	107		$	111		$	122		$	240		$	233		$	345		$	341		$	450		$	448
Earned premiums		116			113			112			112			117			115			112			113			224			225			337			340			453			457
Loss and loss expense ratio		58.5	%		72.8	%		57.0	%		57.7	%		61.5	%		60.6	%		60.2	%		57.9	%		57.4	%		59.0	%		62.5	%		59.6	%		61.5	%		60.1	%
Less catastrophe loss ratio		0.6			(0.5)			3.1			0.6			0.0			0.2			0.3			0.0			1.9			0.1			1.0			0.2			0.9			0.1
Loss and loss expense excluding catastrophe loss ratio		57.9	%		73.3	%		53.9	%		57.1	%		61.5	%		60.4	%		59.9	%		57.9	%		55.5	%		58.9	%		61.5	%		59.4	%		60.6	%		60.0	%

Workers' compensation:
Written premiums	$	91		$	85		$	91		$	111		$	80		$	75		$	83		$	100		$	203		$	183		$	288		$	258		$	379		$	338
Earned premiums		95			93			90			88			85			82			82			79			178			161			271			244			366			328
Loss and loss expense ratio		89.3	%		90.3	%		83.1	%		78.6	%		134.2	%		74.0	%		77.0	%		76.5	%		80.8	%		76.8	%		84.1	%		75.9	%		85.4	%		90.9	%
Less catastrophe loss ratio		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Loss and loss expense excluding catastrophe loss ratio		89.3	%		90.3	%		83.1	%		78.6	%		134.2	%		74.0	%		77.0	%		76.5	%		80.8	%		76.8	%		84.1	%		75.9	%		85.4	%		90.9	%

Specialty packages:
Written premiums	$	35		$	35		$	34		$	40		$	32		$	35		$	34		$	37		$	74		$	71		$	109		$	105		$	144		$	138
Earned premiums		35			35			35			36			34			34			34			34			71			68			106			103			141			137
Loss and loss expense ratio		44.9	%		74.2	%		82.1	%		64.3	%		53.4	%		69.9	%		57.2	%		87.8	%		73.1	%		72.4	%		73.5	%		71.5	%		66.3	%		67.0	%
Less catastrophe loss ratio		5.8			7.1			29.2			3.6			4.6			9.9			1.8			4.4			16.2			3.1			13.3			5.3			11.4			5.2
Loss and loss expenses excluding catastrophe loss ratio		39.1	%		67.1	%		52.9	%		60.7	%		48.8	%		60.0	%		55.4	%		83.4	%		56.9	%		69.3	%		60.2	%		66.2	%		54.9	%		61.8	%

Surety and executive risk:
Written premiums	$	23		$	28		$	24		$	22		$	21		$	25		$	18		$	20		$	46		$	38		$	74		$	63		$	97		$	85
Earned premiums		24			24			24			21			21			21			19			19			45			38			69			59			93			80
Loss and loss expense ratio		36.3	%		47.3	%		89.6	%		26.5	%		69.2	%		31.5	%		7.4	%		26.4	%		60.1	%		16.9	%		55.6	%		22.0	%		50.7	%		34.2	%
Less catastrophe loss ratio		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Loss and loss expense excluding catastrophe loss ratio		36.3	%		47.3	%		89.6	%		26.5	%		69.2	%		31.5	%		7.4	%		26.4	%		60.1	%		16.9	%		55.6	%		22.0	%		50.7	%		34.2	%

Machinery and equipment:
Written premiums	$	7		$	7		$	8		$	7		$	6		$	7		$	6		$	7		$	15		$	13		$	22		$	20		$	29		$	26
Earned premiums		7			7			7			7			6			7			6			7			14			13			20			19			27			26
Loss and loss expense ratio		62.4	%		45.2	%		27.0	%		32.2	%		31.6	%		21.5	%		24.1	%		12.3	%		29.6	%		18.1	%		34.8	%		19.3	%		42.0	%		22.4	%
Less catastrophe loss ratio		(0.5)			2.1			0.0			0.0			(0.1)			0.2			0.0			(0.6)			0.1			(0.2)			0.8			0.0			0.4			(0.1)
Loss and loss expense excluding catastrophe loss ratio		62.9	%		43.1	%		27.0	%		32.2	%		31.7	%		21.3	%		24.1	%		12.9	%		29.5	%		18.3	%		34.0	%		19.3	%		41.6	%		22.5	%
												&nbs p;

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not equal the full year as each is computed
independently.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Quarterly Property Casualty Data - By Personal Lines of Business

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Personal auto:
Written premiums	$	79		$	96		$	104		$	79		$	89		$	112		$	119		$	89		$	184		$	208		$	279		$	321		$	359		$	409
Earned premiums		91			95			98			101			104			107			110			111			199			221			294			329			385			433
Loss and loss expense ratio		74.3	%		60.6	%		65.8	%		60.1	%		54.0	%		65.0	%		59.9	%		60.4	%		62.9	%		60.1	%		62.2	%		61.7	%		65.0	%		59.9	%
Less catastrophe loss ratio		5.7			1.4			3.6			0.8			0.6			0.4			1.1			0.2			2.2			0.6			2.0			0.5			2.8			0.6
Loss and loss expense excluding catastrophe loss ratio		68.6	%		59.2	%		62.2	%		59.3	%		53.4	%		64.6	%		58.8	%		60.2	%		60.7	%		59.5	%		60.2	%		61.2	%		62.2	%		59.3	%

Homeowner:
Written premiums	$	66		$	79		$	83		$	62		$	67		$	80		$	81		$	59		$	144		$	140		$	224		$	219		$	290		$	288
Earned premiums		70			72			74			73			71			72			70			69			146			139			219			209			289			282
Loss and loss expense ratio		80.8	%		93.9	%		93.1	%		64.0	%		83.4	%		78.0	%		75.8	%		64.6	%		78.6	%		70.2	%		83.7	%		72.9	%		83.0	%		75.6	%
Less catastrophe loss ratio		36.0			15.0			33.1			11.1			43.2			15.2			14.6			(6.1)			22.1			4.3			19.8			8.0			23.7			16.9
Loss and loss expense excluding catastrophe loss ratio		44.8	%		78.9	%		60.0	%		52.9	%		40.2	%		62.8	%		61.2	%		70.7	%		56.5	%		65.9	%		63.9	%		64.9	%		59.3	%		58.7	%

Other personal:
Written premiums	$	21		$	23		$	24		$	20		$	21		$	23		$	24		$	20		$	44		$	45		$	67		$	68		$	87		$	89
Earned premiums		22			22			22			22			22			22			22			22			45			45			66			67			88			89
Loss and loss expense ratio		45.6	%		63.3	%		80.9	%		47.4	%		37.0	%		58.0	%		38.3	%		49.5	%		64.2	%		41.7	%		63.9	%		47.1	%		59.4	%		44.6	%
Less Catastrophe loss ratio		9.9			5.2			10.8			3.8			2.0			5.0			1.0			3.9			7.4			2.5			6.6			3.3			7.4			3.0
Loss and loss expense excluding catastrophe loss ratio		35.7	%		58.1	%		70.1	%		43.6	%		35.0	%		53.0	%		37.3	%		45.6	%		56.8	%		39.2	%		57.3	%		43.8	%		52.0	%		41.6	%


Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.

2006 Fourth-Quarter Supplement

< TD valign=bottom width=36.267> < TD valign=bottom width=18.133> < TD valign=bottom width=36.267> < TD valign=bottom width=36.267> < TD valign=bottom width=18.133> < TD valign=bottom width=18.133> < TD valign=bottom width=18.133> < TD valign=bottom width=36.267> < TD valign=bottom width=36.267>


Cincinnati Insurance Group
10-Year Property Casualty Data - Consolidated

(Dollars in millions)	Years ended December 31,
	2006			2005			2004			2003			2002			2001			2000			1999			1998			1997
Premiums
Adjusted written premiums (statutory)*	$	3,172		$	3,097		$	3,026		$	2,789		$	2,496		$	2,188		$	1,936		$	1,681		$	1,558		$	1,472
Codification		0			0			0			0			0			402			(55)			0			0			0
Written premium adjustment -- statutory only		6			(21)			(29)			26			117			0			0			0			0			0
Reported written premiums (statutory)**		3,178			3,076			2,997			2,815			2,613			2,590			1,881			1,681			1,558			1,472
Unearned premiums change		(14)			(18)			(78)			(162)			(222)			(517)			(53)			(23)			(15)			(18)
Earned premiums (GAAP)	$	3,164		$	3,058		$	2,919		$	2,653		$	2,391		$	2,073		$	1,828		$	1,658		$	1,543		$	1,454

Year-over-year growth rate:
Adjusted written premiums (statutory)		2.4	%		2.3	%		8.5	%		11.7	%		14.0	%		13.0	%		15.2	%		7.9	%		5.8	%		6.4	%
Written premiums (statutory)		3.3	%		2.6	%		6.5	%		7.7	%		0.9	%		37.7	%		11.9	%		7.9	%		5.8	%		6.4	%
Earned premiums		3.5	%		4.8	%		10.0	%		11.0	%		15.3	%		13.4	%		10.3	%		7.5	%		6.1	%		6.4	%

Statutory combined ratio
Reported statutory combined ratio*		93.9	%		89.0			89.4	%		94.2	%		98.4	%		99.5	%		112.5	%		100.4	%		104.2	%		98.3	%
Codification		0.0			0.0			0.0			0.0			0.0			4.1			(0.9)			0.0			0.0			0.0
Written premium adjustment -- statutory only		nm			nm			nm			nm			1.2			0.0			0.0			0.0			0.0			0.0
One-time item		0.0			0.0			0.0			0.8			0.0			0.0			(1.7)			0.0			0.0			0.0
Statutory combined ratio (adjusted)		93.9	%		89.0	%		89.4	%		95.0	%		99.6	%		103.6	%		109.9	%		100.4	%		104.2	%		98.3	%
Less catastrophe losses		5.5			4.1			5.1			3.6			3.6			3.1			2.7			2.5			6.1
Statutory combined ratio excluding catastrophe losses (adjusted)		88.4	%		84.9	%		84.3	%		91.4	%		96.0	%		100.5	%		107.2	%		97.9	%		98.1	%

Reported commission expense ratio*		18.7	%		19.3	%		19.2	%		17.6	%		15.9	%		13.9	%		17.4	%		17.4	%		17.6	%
Codification		0.0			0.0			0.0			0.0			0.0			2.6			(0.5)			0.0			0.0
Written premium adjustment -- statutory only		nm			nm			nm			nm			0.8			0.0			0.0			0.0			0.0
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Commission expense ratio (adjusted)		18.7	%		19.3	%		19.2	%		17.6	%		16.7	%		16.5	%		16.9	%		17.4	%		17.6	%

Reported other expense ratio*		11.7	%		10.5	%		10.1	%		8.9	%		9.6	%		8.7	%		12.6	%		11.4	%		11.9	%
Codification		0.0			0.0			0.0			0.0			0.0			1.5			(0.4)			0.0			0.0
Written premium adjustment -- statutory only		nm			nm			nm			nm			0.4			0.0			0.0			0.0			0.0
One-time item		0.0			0.0			0.0			0.8			0.0			0.0			(1.7)			0.0			0.0
Other expense ratio (adjusted)		11.7	%		10.5	%		10.1	%		9.7	%		10.0	%		10.2	%		10.5	%		11.4	%		11.9	%

Reported statutory expense ratio*		30.4	%		29.8	%		29.3	%		26.5	%		25.5	%		22.6	%		30.0	%		28.8	%		29.5	%
Codification		0.0			0.0			0.0			0.0			0.0			4.1			(0.9)			0.0			0.0
Written premium adjustment -- statutory only		nm			nm			nm			nm			1.2			0.0			0.0			0.0			0.0
One-time item		0.0			0.0			0.0			0.8			0.0			0.0			(1.7)			0.0			0.0
Statutory expense ratio (adjusted)		30.4	%		29.8	%		29.3	%		27.3	%		26.7	%		26.7	%		27.4	%		28.8	%		29.5	%

GAAP combined ratio
GAAP combined ratio		94.3	%		89.2	%		89.8	%		94.7	%		99.7	%		104.9	%		112.8	%		100.2	%		104.3	%		98.4	%
One-time item		0.0			0.0			0.0			0.8			0.0			0.0			(2.1)			0.0			0.0			0.0
GAAP combined ratio before one-time item		94.3	%		89.2	%		89.8	%		95.5	%		99.7	%		104.9	%		110.7	%		100.2	%		104.3	%		98.4	%

Written premiums to surplus
Adjusted premiums to statutory surplus ratio		0.672			0.739			0.721			1.002			1.067			0.864
Written premium adjustment		0.001			(0.005)			(0.007)			0.010			0.050			0.159
Reported premiums to statutory surplus ratio		0.673			0.734			0.714			1.012			1.117			1.023

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.
nm – Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed by the appropriate regulatory bodies.
** Prior to 2001, property casualty premiums were recognized as they were billed throughout the policy period. Effective January 1, 2001, written premiums have been recognized on an annualized basis at the effective date of the policy. Written premiums for 2000 were reclassified to conform with the 2001 presentation; information was not readily available to reclassify earlier year statutory data. The growth rates in written premiums between 1999 and 2000 are overstated because 1999 premiums are showed on a billed basis.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
6-Year Property Casualty Data - Commercial Lines

(Dollars in millions)	Years ended December 31,
	2006			2005			2004			2003			2002			2001
Premiums
Adjusted written premiums (statutory)*	$	2,435		$	2,306		$	2,209		$	2,009		$	1,795		$	1,551
Codification		0			0			0			0			0			276
Written premium adjustment – statutory only		7			(16)			(23)			22			110			0
Reported written premiums (statutory)	$	2,442		$	2,290		$	2,186		$	2,031		$	1,905		$	1,827
Unearned premiums change		(40)			(36)			(60)			(123)			(184)			(374)
Earned premiums (GAAP)	$	2,402		$	2,254		$	2,126		$	1,908		$	1,721		$	1,453

Year-over-year growth rate:
Adjusted written premiums (statutory)		5.6	%		4.4	%		10.0	%		11.9	%		15.8	%		16.9	%
Written premiums (statutory)		6.7	%		4.8	%		7.6	%		6.6	%		4.2	%		43.3	%
Earned premiums		6.6	%		6.0	%		11.4	%		10.8	%		18.6	%		17.9	%

Statutory combined ratio
Reported statutory combined ratio*		90.8	%		87.1			83.7	%		90.9	%		95.3	%		96.7	%
Codification		0.0			0.0			0.0			0.0			0.0			4.0
Written premium adjustment – statutory only		nm			nm			nm			nm			1.5			0.0
One-time item		0.0			0.0			0.0			0.7			0.0			0.0
Statutory combined ratio (adjusted)		90.8	%		87.1	%		83.7	%		91.6	%		96.8	%		100.7	%
Less catastrophe losses		3.7			3.4			3.4			2.2			2.3			1.9
Statutory combined ratio excluding catastrophe losses (adjusted)		87.1	%		83.7	%		80.3	%		89.4	%		94.5	%		98.8	%

GAAP combined ratio
GAAP combined ratio		91.3	%		87.4	%		84.1	%		91.3	%		96.6	%		101.7	%
One-time item		0.0			0.0			0.0			0.8			0.0			0.0
GAAP combined ratio before one-time item		91.3	%		87.4	%		84.1	%		92.1	%		96.6	%		101.7	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.
nm – Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed by the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
6-Year Property Casualty Data - Personal Lines

(Dollars in millions)	Years ended December 31,
	2006			2005			2004			2003			2002			2001
Premiums
Adjusted written premiums (statutory)*	$	737		$	791		$	817		$	780		$	701		$	637
Codification		0			0			0			0			0			126
Written premium adjustment – statutory only		(1)			(5)			(6)			4			7			0
Reported written premiums (statutory)	$	736		$	786		$	811		$	784		$	708		$	763
Unearned premiums change		26			18			(18)			(39)			(38)			(143)
Earned premiums (GAAP)	$	762		$	804		$	793		$	745		$	670		$	620

Year-over-year growth rate:
Adjusted written premiums (statutory)		(6.8)	%		(3.2)	%		4.7	%		12.0	%		9.8	%		4.6	%
Written premiums (statutory)		(6.4)	%		(3.1)	%		3.4	%		10.8	%		(7.2)	%		26.1	%
Earned premiums		(5.3)	%		1.4	%		6.4	%		11.2	%		8.1	%		4.0	%

Statutory combined ratio
Reported statutory combined ratio*		103.6	%		94.3			104.6	%		102.9	%		106.5	%		105.9	%
Codification		0.0			0.0			0.0			0.0			0.0			4.6
Written premium adjustment – statutory only		nm			nm			nm			nm			0.3			0.0
One-time item		0.0			0.0			0.0			1.0			0.0			0.0
Statutory combined ratio (adjusted)		103.6	%		94.3	%		104.6	%		103.9	%		106.8	%		110.5	%
Less catastrophe losses		11.3			6.3			9.7			7.3			7.1			5.8
Statutory combined ratio excluding catastrophe losses (adjusted)		92.3	%		88.0	%		94.9	%		96.6	%		99.7	%		104.7	%

GAAP combined ratio
GAAP combined ratio		103.6	%		94.4	%		105.0	%		103.6	%		107.6	%		112.4	%
One-time item		0.0			0.0			0.0			1.1			0.0			0.0
GAAP combined ratio before one-time item		103.6	%		94.4	%		105.0	%		104.7	%		107.6	%		112.4	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts.
NM – Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed by the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Quarterly Property Casualty Data - Consolidated

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Premiums
Adjusted written premiums (statutory)	$	785		$	787		$	804		$	796		$	765		$	764		$	780		$	787		$	1,600		$	1,567		$	2,387		$	2,332		$	3,172		$	3,097
Written premium adjustment – statutory only		(30)			(7)			10			33			(38)			(3)			10			10			43			20			36			17			6			(21)
Reported written premiums (statutory)*	$	755		$	780		$	814		$	829		$	727		$	761		$	790		$	797		$	1,643		$	1,587		$	2,423		$	2,349		$	3,178		$	3,076
Unearned premiums change		13			11			(21)			(51)			48			4			(25)			(44)			(72)			(73)			(60)			(66)			(66)			(19)
Earned premiums	$	802		$	791		$	793		$	778		$	775		$	765		$	765		$	753		$	1,571		$	1,518		$	2,362		$	2,283		$	3,164		$	3,058

Statutory combined ratio
Reported statutory combined ratio*		95.9	%		96.4			93.7	%		89.6	%		85.8	%		96.6	%		86.6	%		87.3	%		91.7	%		86.9	%		93.2	%		90.1	%		93.9	%		89.0	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory combined ratio		95.9	%		96.4	%		93.7	%		89.6	%		85.8	%		96.6	%		86.6	%		87.3	%		91.7	%		86.9	%		93.2	%		90.1	%		93.9	%		89.0	%
Less catastrophe losses		5.5			3.5			8.0			5.0			5.6			8.6			2.0			0.3			6.5			1.1			5.5			3.6			5.5			4.1
Adjusted statutory combined ratio excluding catastrophe losses		90.4	%		92.9	%		85.7	%		84.6	%		80.2	%		88.0	%		84.6	%		87.0	%		85.2	%		85.8	%		87.7	%		86.5	%		88.4	%		84.9	%

Reported commission expense ratio*		19.9	%		19.3	%		17.6	%		18.1	%		20.4	%		20.3	%		19.3	%		16.8	%		17.9	%		18.0	%		18.3	%		18.8	%		18.7	%		19.2	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted commission expense ratio		19.9	%		19.3	%		17.6	%		18.1	%		20.4	%		20.3	%		19.3	%		16.8	%		17.9	%		18.0	%		18.3	%		18.8	%		18.7	%		19.2	%

Reported other expense ratio*		13.4	%		11.9	%		10.8	%		10.8	%		11.6	%		10.8	%		10.3	%		9.8	%		10.8	%		10.0	%		11.2	%		10.2	%		11.7	%		10.5	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted other expense ratio		13.4	%		11.9	%		10.8	%		10.8	%		11.6	%		10.8	%		10.3	%		9.8	%		10.8	%		10.0	%		11.2	%		10.2	%		11.7	%		10.5	%

Reported statutory expense ratio*		33.3	%		31.2	%		28.4	%		28.9	%		32.0	%		31.1	%		29.6	%		26.6	%		28.7	%		28.0	%		29.5	%		29.0	%		30.4	%		29.7	%
Written premium adjustment – statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory expense ratio		33.3	%		31.2	%		28.4	%		28.9	%		32.0	%		31.1	%		29.6	%		26.6	%		28.7	%		28.0	%		29.5	%		29.0	%		30.4	%		29.7	%

GAAP combined ratio
GAAP combined ratio		94.5	%		96.1	%		94.5	%		92.0	%		83.9	%		96.6	%		87.5	%		88.9	%		93.3	%		88.2	%		94.2	%		91.0	%		94.3	%		89.2	%
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
GAAP combined ratio before one-time item		94.5	%		96.1	%		94.5	%		92.0	%		83.9	%		96.6	%		87.5	%		88.9	%		93.3	%		88.2	%		94.2	%		91.0	%		94.3	%		89.2	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts
may not equal the full year as each is computed independently.
nm - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Quarterly Property Casualty Data - Commercial Lines

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Premiums
Adjusted written premiums (statutory)	$	618		$	589		$	593		$	635		$	584		$	547		$	557		$	617		$	1,228		$	1,174		$	1,817		$	1,721		$	2,435		$	2,306
Written premium adjustment -- statutory only		(29)			(7)			10			33			(36)			(1)			9			12			43			21			36			20			7			(16)
Reported written premiums (statutory)*	$	589		$	582		$	603		$	668		$	548		$	546		$	566		$	629		$	1,271		$	1,195		$	1,853		$	1,741		$	2,442		$	2,290
Unearned premiums change		30			20			(4)			(86)			28			18			(3)			(78)			(90)			(81)			(69)			(63)			(40)			(36)
Earned premiums	$	619		$	602		$	599		$	582		$	576		$	564		$	563		$	551		$	1,181		$	1,114		$	1,783		$	1,678		$	2,402		$	2,254

Statutory combined ratio
Reported statutory combined ratio*		92.4	%		94.1			89.6	%		87.5	%		84.3	%		95.5	%		83.9	%		85.5	%		88.6	%		84.6	%		90.3	%		88.1	%		90.8	%		87.1	%
Written premium adjustment -- statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory combined ratio		92.4	%		94.1	%		89.6	%		87.5	%		84.3	%		95.5	%		83.9	%		85.5	%		88.6	%		84.6	%		90.3	%		88.1	%		90.8	%		87.1	%
Less catastrophe losses		1.9			2.3			5.6			5.1			2.4			9.5			0.4			1.1			5.3			0.8			4.3			3.6			3.7			3.4
Adjusted statutory combined ratio excluding catastrophe losses		90.5	%		91.8	%		84.0	%		82.4	%		81.9	%		86.0	%		83.5	%		84.4	%		83.3	%		83.8	%		86.0	%		84.5	%		87.1	%		83.7	%

GAAP combined ratio
GAAP combined ratio		91.1	%		93.4	%		90.3	%		90.5	%		82.1	%		95.2	%		84.8	%		87.5	%		90.4	%		86.1	%		91.4	%		89.2	%		91.3	%		87.4	%
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
GAAP combined ratio before one-time item		91.1	%		93.4	%		90.3	%		90.5	%		82.1	%		95.2	%		84.8	%		87.5	%		90.4	%		86.1	%		91.4	%		89.2	%		91.3	%		87.4	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.
nm - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


Cincinnati Insurance Group
Quarterly Property Casualty Data - Personal Lines

(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
	12/31/06			9/30/06			6/30/06			3/31/06			12/31/05			9/30/05			6/30/05			3/31/05			6/30/06			6/30/05			9/30/06			9/30/05			12/31/06			12/31/05
Premiums
Adjusted written premiums (statutory)	$	167		$	198		$	211		$	161		$	181		$	217		$	223		$	170		$	372		$	393		$	570		$	611		$	737		$	791
Written premium adjustment -- statutory only		(1)			0			0			0			(2)			(2)			1			(2)			0			(1)			0			(3)			(1)			(5)
Reported written premiums (statutory)*	$	166		$	198		$	211		$	161		$	179		$	215		$	224		$	168		$	372		$	392		$	570		$	608		$	736		$	786
Unearned premiums change		(17)			(9)			(17)			35			20			(14)			(22)			34			18			8			9			(3)			(26)			17
Earned premiums	$	183		$	189		$	194		$	196		$	199		$	201		$	202		$	202		$	390		$	404		$	579		$	605		$	762		$	804

Statutory combined ratio
Reported statutory combined ratio*		107.7	%		104.0	%		106.4	%		98.1	%		90.1	%		99.9	%		93.6	%		94.0	%		101.6	%		93.7	%		102.3	%		95.7	%		103.6	%		94.3	%
Written premium adjustment -- statutory only		nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm			nm
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
Adjusted statutory combined ratio		107.7	%		104.0	%		106.4	%		98.1	%		90.1	%		99.9	%		93.6	%		94.0	%		101.6	%		93.7	%		102.3	%		95.7	%		103.6	%		94.3	%
Less catastrophe losses		17.9			7.0			15.6			5.0			14.9			6.3			6.2			2.0			10.3			2.1			9.2			3.5			11.3			6.3
Adjusted statutory combined ratio excluding catastrophe losses		89.8	%		97.0	%		90.8	%		93.1	%		75.2	%		93.6	%		87.4	%		96.0	%		91.3	%		91.6	%		93.1	%		92.2	%		92.3	%		88.0	%

GAAP combined ratio
GAAP combined ratio		106.0	%		104.4	%		107.6	%		96.4	%		89.0	%		100.5	%		95.3	%		92.7	%		102.0	%		94.0	%		102.8	%		96.1	%		103.6	%		94.4	%
One-time item		0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0			0.0
GAAP combined ratio before one-time item		106.0	%		104.4	%		107.6	%		96.4	%		89.0	%		100.5	%		95.3	%		92.7	%		102.0	%		94.0	%		102.8	%		96.1	%		103.6	%		94.4	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
equal the full year as each is computed independently.
nm - Not meaningful
* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


The Cincinnati Life Insurance Company
GAAP Statements of Income

		For the three months ended December 31,							For the twelve months ended December 31,
		2006		2005		Change	%Change		2006		2005		Change	% Change
Revenues:
Premiums earned:
Property casualty	$	0	$	0	$	0	NA	$	0	$	0	$	0	NA
Life		43,271,070		40,421,077		2,849,993	7.05		152,590,039		143,808,461		8,781,578	6.11
Accident health		1,703,987		1,617,668		86,319	5.34		6,652,508		6,347,605		304,903	4.80
Premiums ceded		(13,815,204)		(13,851,254)		36,050	0.26		(44,504,201)		(43,798,779)		(705,422)	(1.61)
Total premiums earned		31,159,853		28,187,491		2,972,362	10.54		114,738,346		106,357,287		8,381,059	7.88
Investment income		27,053,035		26,013,305		1,039,730	4.00		107,656,860		99,323,763		8,333,097	8.39
Realized investment gains and losses		2,533,775		9,832,034		(7,298,259)	(74.23)		44,861,000		17,188,854		27,672,146	160.99
Other income		992,375		1,015,456		(23,081)	(2.27)		3,552,294		3,561,244		(8,950)	(0.25)
Total revenues	$	61,739,038	$	65,048,286	$	(3,309,248)	(5.09)	$	270,808,500	$	226,431,148	$	44,377,352	19.60


Benefits & expenses:
Losses & policy benefits	$	43,696,578	$	12,945,476	$	30,751,102	237.54	$	161,984,990	$	141,170,430	$	20,814,560	14.74
Reinsurance recoveries		(13,247,792)		11,824,818		(25,072,610)	(212.03)		(39,953,090)		(39,542,190)		(410,900)	(1.04)
Commissions		8,410,482		8,941,982		(531,500)	(5.94)		34,081,135		34,718,994		(637,859)	(1.84)
Other operating expenses		12,192,870		10,732,035		1,460,835	13.61		31,977,077		28,592,514		3,384,563	11.84
Interest expense		98,000		0		98,000	NA		98,000		0		98,000	NA
Taxes, licenses & fees		935,887		32,729		903,158	2,759.50		3,080,836		3,205,175		(124,339)	(3.88)
Incr deferred acq expense		(3,479,444)		(4,281,595)		802,151	18.73		(17,717,144)		(14,048,474)		(3,668,670)	(26.11)
Other expenses		1		0		1	NA		109		108		1	0.93
Total expenses	$	48,606,582	$	40,195,445	$	8,411,137	20.93	$	173,551,913	$	154,096,557	$	19,455,356	12.63


Income before income taxes	$	13,132,456	$	24,852,841	$	(11,720,385)	(47.16)	$	97,256,587	$	72,334,591	$	24,921,996	34.45

Provision for income taxes:
Current	$	953,701	$	3,623,075	$	(2,669,374)	(73.68)	$	6,273,558	$	12,721,453	$	(6,447,895)	(50.69)
Current capital gains/losses		947,821		3,441,212		(2,493,391)	(72.46)		15,879,350		6,016,099		9,863,251	163.95
Deferred		2,628,721		1,975,964		652,757	33.03		12,406,344		6,314,644		6,091,700	96.47
Total income taxes	$	4,530,243	$	9,040,251	$	(4,510,008)	(49.89)	$	34,559,252	$	25,052,196	$	9,507,056	37.95

Net income	$	8,602,213	$	15,812,590	$	(7,210,377)	(45.60)	$	62,697,335	$	47,282,395	$	15,414,940	32.60

2006 Fourth-Quarter Supplement


The Cincinnati Life Insurance Company
Statutory Statements of Income

		For the three months ended December 31,					For the twelve months ended December 31,
		2006		2005	% Change		2006		2005	% Change

Net premiums written	$	38,109,979	$	40,102,013	(4.97)	$	153,442,227	$	193,851,091	(20.85)
Net investment income		27,053,035		26,013,305	4.00		107,656,860		99,323,763	8.39
Amortization of interest maintenance reserve		59,928		867,345	(93.09)		160,205		3,969,372	(95.96)
Commissions and expense allowances on reinsurance ceded		2,482,659		2,710,463	(8.40)		8,261,423		11,472,367	(27.99)
Income from fees associated with Separate Accounts		992,375		1,015,456	(2.27)		3,552,294		3,561,244	(0.25)
Total revenues	$	68,697,977	$	70,708,582	(2.84)	$	273,073,009	$	312,177,838	(12.53)

Death benefits and matured endowments		8,866,654		6,791,497	30.56	$	38,964,236		32,409,589	20.22
Annuity benefits		8,580,838		5,013,543	71.15		35,200,488		21,805,168	61.43
Disability benefits and benefits under accident and health contracts		415,184		491,221	(15.48)		1,630,523		1,537,587	6.04
Surrender benefits and group conversions		5,991,218		4,068,367	47.26		22,251,863		18,979,141	17.24
Interest and adjustments on deposit-type contract funds		2,380,022		2,762,911	(13.86)		9,394,586		10,249,422	(8.34)
Increase in aggregate reserves for life and accident and health contracts		23,436,742		27,180,937	(13.78)		95,336,456		142,678,482	(33.18)
Payments on supplementary contracts with life contingencies		77,083		75,111	2.63		308,744		295,735	4.40
Total benefit expenses	$	49,747,741	$	46,383,589	7.25	$	203,086,897	$	227,955,124	(10.91)

Commissions	$	8,344,872	$	8,458,360	(1.34)	$	33,700,524	$	34,235,371	(1.56)
General insurance expenses and taxes		11,073,587		9,135,840	21.21		35,288,388		33,177,815	6.36
Increase in loading on deferred and uncollected premiums		200,324		(107,202)	286.87		(4,278,539)		(4,680,691)	8.59
Net transfers to or (from) Separate Accounts		0		(413,267)	N/A		(211,220)		(413,267)	48.89
Other deductions		0		0	N/A		109		108	0.63
Total operating expenses	$	19,618,783	$	17,073,731	12.19	$	64,499,261	$	62,319,336	3.50

Federal and Foreign Income Taxes Incurred		950,983		2,717,237	(65.00)		5,973,699		11,990,488	(50.18)

Net gain from operations before realized capital gains or (losses)	$	(1,619,530)	$	4,534,025	(135.72)	$	(486,849)	$	9,912,889	(104.91)

Net realized gains or (losses) net of capital gains tax		1,306,320		10,768,634	(87.87)		28,946,326		11,089,183	161.03

Net Income (Statutory)	$	(313,210)	$	15,302,659	(102.05)	$	28,459,477	$	21,002,073	35.51

* Statutory data prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners and filed with the appropriate regulatory bodies.

2006 Fourth-Quarter Supplement


The Cincinnati Life Insurance Company
Expenses as a Percentage of Premium

	(Dollars in millions)	Three months ended																								Six months ended						Nine months ended						Twelve months ended
		12/31/06			09/30/06			06/30/06			03/31/06			12/31/05			09/30/05			06/30/05			3/31/05			6/30/06			06/30/05			09/30/06			09/30/05			12/31/06			12/31/05
	Gross Written Premiums	$	54		$	50		$	51		$	50		$	57		$	66		$	64		$	62		$	101		$	126		$	152		$	192		$	206		$	249
	Bank Owned Life Insurance (BOLI) Adjustment		0			0			0			0			0			0			0			0			0			0			0			0			0			0
	Adjusted Gross Written Premiums	$	54		$	50		$	51		$	50		$	57		$	66		$	64		$	62		$	101		$	126		$	152		$	192		$	206		$	249

	Insurance Expense	$	10		$	7		$	7		$	7		$	8		$	7		$	7		$	7		$	14		$	14		$	21		$	21		$	31		$	29

	Expense Ratio		17.8	%		14.7	%		13.5	%		14.5	%		14.4	%		10.3	%		10.7	%		10.9	%		14.0	%		10.8	%		14.0	%		10.8	%		15.0	%		11.7	%
	Expense Ratio based on Adjusted Gross Written Premium		17.8	%		14.7	%		13.5	%		14.5	%		14.4	%		10.3	%		10.7	%		10.9	%		14.0	%		10.8	%		14.0	%		10.8	%		15.0	%		11.7	%



	(Dollars in millions)	Years ended December 31,
		2006			2005			2004			2003			2002			2001			2000
	Gross Written Premiums	$	206		$	249		$	230		$	173		$	244		$	122		$	157
	Bank Owned Life Insurance (BOLI) Adjustment		0			0			(10)			0			(34)			0			(20)
	Adjusted Gross Written Premiums	$	206		$	249		$	220		$	173		$	210		$	122		$	137

	Insurance Expense	$	31		$	29		$	25		$	25		$	27		$	25		$	20

	Expense Ratio		15.0	%		11.7	%		11.1	%		14.8	%		10.9	%		20.6	%		12.9	%
	Expense Ratio based on Adjusted Gross Written Premium		15.0	%		11.7	%		11.6	%		14.8	%		12.6	%		20.6	%		14.8	%


	Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on whole dollar amounts. The sum of quarterly amounts may not
	equal the full year as each is computed independently.

2006 Fourth-Quarter Supplement

EX-99 4 ex993.htm EXHIBIT 99.3 .

CINCINNATI FINANCIAL CORPORATION

Mailing Address: P.O. BOX 145496

CINCINNATI, OHIO 45250-5496

(513) 870-2000

Investor Contact: Heather J. Wietzel

(513) 870-2768

Media Contact: Joan O. Shevchik

(513) 603-5323

Cincinnati Financial Corporation Increases Cash Dividend and Announces Board Actions

· Sets stage for 47th consecutive year of higher dividends with 6% increase in indicated annual dividend rate

· Confirms slate of nominees for election by shareholders on May 5

· Affirms codes of conduct and ethics and committee charters and updates governance guidelines

Cincinnati, February 5, 2007 -- Cincinnati Financial Corporation (Nasdaq: CINF) today announced that the board of directors voted at its regular meeting on February 2, 2007, to increase the regular quarterly cash dividend 6 percent to 35.5 cents per share, payable April 16, 2007, to shareholders of record on March 23, 2007. At the new level, the indicated annual dividend is $1.42 per share. Cash dividends declared in 2006 were $1.34 per share.

Chairman and Chief Executive Officer John J. Schiff, Jr., CPCU, commented, “Careful attention to property casualty underwriting and our total-return investment strategy has helped us maintain a strong financial position and achieve industry-leading results over the long-term. Today’s action signals the board’s continuing confidence in our long-term outlook.

Cincinnati Financial's common stock total return to shareholders over the five years ended December 31, 2006, was 49.4 percent compared with a 35.0 percent total return for the Standard & Poor's 500 Index.

The company also announced that the board confirmed the slate of nominees for election at the company's annual meeting of shareholders on May 5, 2007. Directors standing for re-election for three-year terms to expire in 2010 are: Dirk J. Debbink, Douglas S. Skidmore and newly appointed director Gregory T. Bier, CPA (retired). As previously announced, Michael Brown and John M. Shepherd, current directors, will not stand for re-election due to the company’s guidelines on director age. The board determined that 10 of the current 15 members meet the applicable criteria for independence.

The board also approved the code of ethics for senior financial officers, the code of conduct for all company associates and board committee charters, which are reviewed annually by the respective committees as stipulated in the governance guidelines. Further, the board formalized several current company practices with updates to the corporate governance guidelines on board membership criteria, director elections and stock ownership guidelines for directors and officers.

“Cincinnati Financial’s management and directors purposefully align business decisions with our mission, which includes fulfilling the company’s obligations to its independent agents, policyholders and shareholders as well as associates, suppliers and communities it serves. We work diligently to meet those obligations and to act with integrity,” said Schiff.

Cincinnati Financial plans to report fourth-quarter and year-end 2006 results on Wednesday, February 7. A conference call to discuss the results will be held at 11:00 a.m. EST on that day. Details regarding the Internet broadcast of the conference call are available on www.cinfin.com/investors, as are the code of ethics, code of conduct, board committee charters and corporate governance guidelines.

Factors that could cause or contribute to such differences include, but are not limited to:

Unusually high levels of catastrophe losses due to risk concentrations, changes in weather patterns, environmental events, terrorism incidents or other causes

Increased frequency and/or severity of claims

Inaccurate estimates or assumptions used for critical accounting estimates

○

Downgrade of the company’s financial strength ratings,

○

Concerns that doing business with the company is too difficult

○

Perceptions that the company’s level of service, particularly claims service, is no longer a distinguishing characteristic in the marketplace or

○

Regulations or laws that change industry or company practices for our agents

Delays or inadequacies in the development, implementation, performance and benefits of technology projects and enhancements

Ability to obtain adequate reinsurance on acceptable terms, amount of reinsurance purchased, financial strength of reinsurers and the potential for non-payment or delay in payment by reinsurers

Increased competition that could result in a significant reduction in the company’s premium growth rate

Underwriting and pricing methods adopted by competitors that could allow them to identify and flexibly price risks, which could decrease our competitive advantages

Actions of insurance departments, state attorneys general or other regulatory agencies that:

○

Restrict our ability to exit or reduce writings of unprofitable coverages or lines of business

○

Place the insurance industry under greater regulatory scrutiny or result in new statutes, rules and regulations

○

Increase our expenses

○

Limit our ability to set fair, adequate and reasonable rates

○

Place us at a disadvantage in the marketplace or

○

Restrict our ability to execute our business model, including the way we compensate agents

Recession or other economic conditions or regulatory, accounting or tax changes resulting in lower demand for insurance products

Events that lead to a significant decline in the value of a particular security and impairment of the asset

Adverse outcomes from litigation or administrative proceedings

Investment activities or market value fluctuations that trigger restrictions applicable to the parent company under the Investment Company Act of 1940

Events, such as an avian flu epidemic, natural catastrophe or construction delays, that could hamper our ability to assemble our workforce at our headquarters location

* * *

EX-99 5 ex994.htm EXHIBIT 99.4 .

CINCINNATI FINANCIAL CORPORATION

Mailing Address: P.O. BOX 145496

CINCINNATI, OHIO 45250-5496

(513) 870-2000

Investor Contact: Heather J. Wietzel

(513) 870-2768

Media Contact: Joan O. Shevchik

(513) 603-5323

Cincinnati Financial Corporation’s Subsidiaries Announce Appointments

Directors, Officers and Counsel

Cincinnati, February 5, 2007 – Cincinnati Financial Corporation (Nasdaq:CINF) – Cincinnati Financial Corporation announced today that the boards of its subsidiary companies appointed directors, officers and counsel at their regular meetings on February 2, 2007.

Gregory T. Bier, CPA (retired), who joined the Cincinnati Financial Corporation board of directors in November 2006, was additionally appointed to boards of all insurance subsidiaries.

Boards of subsidiary companies made the following promotions and new or additional appointments of officers and counsel:

Property Casualty Insurance Subsidiaries:

The Cincinnati Insurance Company

The Cincinnati Casualty Company

The Cincinnati Indemnity Company

Michael R. Abrams, Vice President – Investments

W. Dane Donham, AIM, Vice President – Commercial Lines

David T. Groff, CPCU, FCAS, Vice President – Staff Underwriting

Robyn C. Muhlberg, Vice President – Information Technology

Ronald L. Robinson, Vice President – Field Claims

Michael B. Wedig, CPA, Vice President – Corporate Accounting

Jack Morgan, CFE, Assistant Vice President – Special Investigations

Martin D. Skidmore, Assistant Vice President – Headquarters Claims

Douglas W. Stang, FCAS, MAAA, Assistant Vice President – Staff Underwriting

James E. Streicher, CPCU, AIM, ARe, Assistant Vice President – Personal Lines

William H. Thomas, AIM, CPCU, Assistant Vice President – Commercial Lines

Anthony W. Dunn, CPA, CPCU, Secretary – Internal Audit

David F. Hartkemeier, Secretary – Bond & Executive Risk

Hollis A. Jones, AIM, Secretary – Investments

Michael W. Klenk, Secretary – Data Entry

Doris J. Kuhling, CPCU, AIM, Secretary – Headquarters Claims

Timothy D. Morris, CPCU, APA, Secretary – Premium Audit

Beth A. Scalf, Secretary – Corporate Accounting

Michael J. Donges, CPCU, Assistant Secretary – Web Content Management

Derek J. Rice, AIM, Assistant Secretary – Education & Training

Michael S. Stumpfl, ARM, CSP, Assistant Secretary – Loss Control

Geraldine Brown, Assistant Treasurer – Agency Accounting

Bernard F. Kistler, CPCU, Associate Counsel

Alan E. Mazur, Associate Counsel

The Cincinnati Life Insurance Company:

Michael R. Abrams*

Robyn C. Muhlberg*

Michael B. Wedig*

Anthony W. Dunn*

Hollis A. Jones*

Roger A. Brown, FSA, MAAA, Assistant Secretary – Actuarial

Bernard F. Kistler*

Alan E. Mazur*

*Title as listed above

CinFin Capital Management Company:

Hollis A. Jones*

*Title as listed above

***