XML 27 R17.htm IDEA: XBRL DOCUMENT v3.22.2
Business Segments
 6 Months Ended
Jun. 30, 2022
Segment Reporting [Abstract]  
Business Segments Business Segments
The Company's property and casualty commercial insurance operations are managed and reported in three business segments: Specialty, Commercial and International. These three segments are collectively referred to as Property & Casualty Operations. The Company's operations outside of Property & Casualty Operations are managed and reported in two segments: Life & Group and Corporate & Other.
The accounting policies of the segments are the same as those described in Note A to the Consolidated Financial Statements within CNAF's Annual Report on Form 10-K for the year ended December 31, 2021. The Company manages most of its assets on a legal entity basis, while segment operations are generally conducted across legal entities. As such, only Insurance and Reinsurance receivables, Insurance reserves, Deferred acquisition costs, Goodwill and Deferred non-insurance warranty acquisition expense and revenue are readily identifiable for individual segments. Distinct investment portfolios are not maintained for every individual segment; accordingly, allocation of assets to each segment is not performed. Therefore, a significant portion of Net investment income and Net investment gains or losses are allocated primarily based on each segment's net carried insurance reserves, as adjusted. All significant intersegment income and expense have been eliminated. Income taxes have been allocated on the basis of the taxable income of the segments.
In the following tables, certain financial measures are presented to provide information used by management to monitor the Company's operating performance. Management utilizes these financial measures to monitor the Company's insurance operations and investment portfolio.
The performance of the Company's insurance operations is monitored by management through core income (loss), which is derived from certain income statement amounts. The Company's investment portfolio is monitored by management through analysis of various factors including unrealized gains and losses on securities, portfolio duration and exposure to market and credit risk.
Core income (loss) is calculated by excluding from net income (loss) the after-tax effects of net investment gains or losses and any cumulative effects of changes in accounting guidance. The calculation of core income (loss) excludes net investment gains or losses because net investment gains or losses are generally driven by economic factors that are not necessarily reflective of our primary operations.
The Company's results of operations and selected balance sheet items by segment are presented in the following tables.
Three months ended June 30, 2022
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$794 $974 $269 $118 $— $— $2,155 
Net investment income100 113 14 201 4 — 432 
Non-insurance warranty revenue392 — — — — — 392 
Other revenues— 4 1 1 1 (1)6 
Total operating revenues1,286 1,091 284 320 5 (1)2,985 
Claims, benefits and expenses      
Net incurred claims and benefits456 610 160 293 57 — 1,576 
Policyholders’ dividends2 5 — — — — 7 
Amortization of deferred acquisition costs162 156 56 — — — 374 
Non-insurance warranty expense367 — — — — — 367 
Other insurance related expenses81 134 30 29 1 — 275 
Other expenses12 11 13 2 45 (1)82 
Total claims, benefits and expenses1,080 916 259 324 103 (1)2,681 
Core income (loss) before income tax206 175 25 (4)(98)— 304 
Income tax (expense) benefit on core income (loss)(45)(37)(7)10 20 — (59)
Core income (loss) $161 $138 $18 $6 $(78)$— 245 
Net investment gains (losses)(59)
Income tax (expense) benefit on net investment gains (losses)19 
Net investment gains (losses), after tax(40)
Net income (loss)$205 
Three months ended June 30, 2021
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$762 $881 $266 $126 $— $— $2,035 
Net investment income134 174 14 265 4 — 591 
Non-insurance warranty revenue359 — — — — — 359 
Other revenues— 5 1 (1)2 (1)6 
Total operating revenues1,255 1,060 281 390 6 (1)2,991 
Claims, benefits and expenses    
Net incurred claims and benefits439 588 159 322 31 — 1,539 
Policyholders’ dividends1 6 — — — — 7 
Amortization of deferred acquisition costs159 148 50 — — — 357 
Non-insurance warranty expense332 — — — — — 332 
Other insurance related expenses71 136 39 25 — — 271 
Other expenses12 11 (3)2 40 (1)61 
Total claims, benefits and expenses1,014 889 245 349 71 (1)2,567 
Core income (loss) before income tax241 171 36 41 (65)— 424 
Income tax (expense) benefit on core income (loss)(53)(34)(10)2 12 — (83)
Core income (loss)$188 $137 $26 $43 $(53)$— 341 
Net investment gains (losses)38 
Income tax (expense) benefit on net investment gains (losses)(11)
Net investment gains (losses), after tax27 
Net income (loss)$368 
Six months ended June 30, 2022
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$1,566 $1,878 $533 $238 $(1)$— $4,214 
Net investment income203 231 28 413 5 — 880 
Non-insurance warranty revenue774 — — — — — 774 
Other revenues1 12 — — 3 (3)13 
Total operating revenues2,544 2,121 561 651 7 (3)5,881 
Claims, benefits and expenses      
Net incurred claims and benefits901 1,183 318 574 49 — 3,025 
Policyholders’ dividends3 10 — — — — 13 
Amortization of deferred acquisition costs319 304 95 — — — 718 
Non-insurance warranty expense721 — — — — — 721 
Other insurance related expenses162 264 77 60 3 — 566 
Other expenses25 18 14 5 86 (3)145 
Total claims, benefits and expenses2,131 1,779 504 639 138 (3)5,188 
Core income (loss) before income tax413 342 57 12 (131)— 693 
Income tax (expense) benefit on core income (loss)(89)(72)(13)17 25 — (132)
Core income (loss) $324 $270 $44 $29 $(106)$— 561 
Net investment gains (losses)(70)
Income tax (expense) benefit on net investment gains (losses)27 
Net investment gains (losses), after tax(43)
Net income (loss)$518 

June 30, 2022
(In millions)      
Reinsurance receivables$1,502 $964 $365 $458 $2,485 $— $5,774 
Insurance receivables1,097 1,751 389 3 (2)— 3,238 
Deferred acquisition costs375 314 103 — — — 792 
Goodwill117 — 28 — — — 145 
Deferred non-insurance warranty acquisition expense3,593 — — — — — 3,593 
Insurance reserves 
Claim and claim adjustment expenses6,861 8,954 2,307 3,670 2,767 — 24,559 
Unearned premiums3,093 2,428 650 118 — — 6,289 
Future policy benefits— — — 10,926 — — 10,926 
Deferred non-insurance warranty revenue4,638 — — — — — 4,638 
Six months ended June 30, 2021
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$1,497 $1,736 $518 $246 $— $— $3,997 
Net investment income251 322 28 484 10 — 1,095 
Non-insurance warranty revenue697 — — — — — 697 
Other revenues— 10 1 — 3 (3)11 
Total operating revenues2,445 2,068 547 730 13 (3)5,800 
Claims, benefits and expenses    
Net incurred claims and benefits866 1,227 314 603 29 — 3,039 
Policyholders’ dividends2 11 — — — — 13 
Amortization of deferred acquisition costs313 301 102 — — — 716 
Non-insurance warranty expense643 — — — — — 643 
Other insurance related expenses141 251 74 50 10 — 526 
Other expenses23 20 (8)4 82 (3)118 
Total claims, benefits and expenses1,988 1,810 482 657 121 (3)5,055 
Core income (loss) before income tax457 258 65 73 (108)— 745 
Income tax (expense) benefit on core income (loss)(99)(52)(15)6 19 — (141)
Core income (loss)$358 $206 $50 $79 $(89)$— 604 
Net investment gains (losses)95 
Income tax (expense) benefit on net investment gains (losses)(19)
Net investment gains (losses), after tax76 
Net income (loss)$680 

December 31, 2021
(In millions)
Reinsurance receivables$1,200 $923 $381 $401 $2,579 $— $5,484 
Insurance receivables1,136 1,488 340 6 4 — 2,974 
Deferred acquisition costs363 278 96 — — — 737 
Goodwill117 — 31 — — — 148 
Deferred non-insurance warranty acquisition expense3,476 — — — — — 3,476 
Insurance reserves 
Claim and claim adjustment expenses6,433 8,890 2,280 3,754 2,817 — 24,174 
Unearned premiums3,001 2,066 585 109 — — 5,761 
Future policy benefits— — — 13,236 — — 13,236 
Deferred non-insurance warranty revenue4,503 — — — — — 4,503 
The following table presents operating revenues by line of business for each reportable segment.
Periods ended June 30Three MonthsSix Months
(In millions)2022202120222021
Specialty
Management & Professional Liability$680 $693 $1,353 $1,360 
Surety162 155 310 297 
Warranty & Alternative Risks444 407 881 788 
Specialty revenues1,286 1,255 2,544 2,445 
Commercial
Middle Market374 381 736 756 
Construction350 324 674 633 
Small Business143 143 281 269 
Other Commercial224 212 430 410 
Commercial revenues1,091 1,060 2,121 2,068 
International
Canada91 87 179 166 
Europe118 115 238 226 
Hardy75 79 144 155 
International revenues284 281 561 547 
Life & Group revenues320 390 651 730 
Corporate & Other revenues 5 6 7 13 
Eliminations(1)(1)(3)(3)
Total operating revenues2,985 2,991 5,881 5,800 
Net investment gains (losses)(59)38 (70)95 
Total revenues$2,926 $3,029 $5,811 $5,895