XML 27 R17.htm IDEA: XBRL DOCUMENT v3.22.2.2
Business Segments
 9 Months Ended
Sep. 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 September 30, 2022
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$810 $1,023 $270 $118 $— $— $2,221 
Net investment income102 112 16 187 5 — 422 
Non-insurance warranty revenue399 — — — — — 399 
Other revenues(1)13 — — 1 (2)11 
Total operating revenues1,310 1,148 286 305 6 (2)3,053 
Claims, benefits and expenses      
Net incurred claims and benefits459 733 169 310 (13)— 1,658 
Policyholders’ dividends2 5 — — — — 7 
Amortization of deferred acquisition costs169 163 51 — — — 383 
Non-insurance warranty expense371 — — — — — 371 
Other insurance related expenses88 145 35 29 1 (1)297 
Other expenses15 3 11 2 47 (1)77 
Total claims, benefits and expenses1,104 1,049 266 341 35 (2)2,793 
Core income (loss) before income tax206 99 20 (36)(29)— 260 
Income tax (expense) benefit on core income (loss)(45)(19)(1)14 4 — (47)
Core income (loss) $161 $80 $19 $(22)$(25)$— 213 
Net investment gains (losses)(96)
Income tax (expense) benefit on net investment gains (losses)11 
Net investment gains (losses), after tax(85)
Net income (loss)$128 
Three months ended September 30, 2021
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$773 $893 $271 $123 $— $(1)$2,059 
Net investment income116 141 14 240 2 — 513 
Non-insurance warranty revenue357 — — — — — 357 
Other revenues1 7 — (1)2 (1)8 
Total operating revenues1,247 1,041 285 362 4 (2)2,937 
Claims, benefits and expenses    
Net incurred claims and benefits446 720 171 296 (6)— 1,627 
Policyholders’ dividends— 5 — — — — 5 
Amortization of deferred acquisition costs165 148 55 — — — 368 
Non-insurance warranty expense330 — — — — — 330 
Other insurance related expenses71 125 32 27 (1)(1)253 
Other expenses13 8 4 1 37 (1)62 
Total claims, benefits and expenses1,025 1,006 262 324 30 (2)2,645 
Core income (loss) before income tax222 35 23 38 (26)— 292 
Income tax (expense) benefit on core income (loss)(49)(8)(6)3 5 — (55)
Core income (loss)$173 $27 $17 $41 $(21)$— 237 
Net investment gains (losses)22 
Income tax (expense) benefit on net investment gains (losses)(3)
Net investment gains (losses), after tax19 
Net income (loss)$256 
Nine months ended September 30, 2022
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$2,376 $2,901 $803 $356 $(1)$— $6,435 
Net investment income305 343 44 600 10 — 1,302 
Non-insurance warranty revenue1,173 — — — — — 1,173 
Other revenues— 25 — — 4 (5)24 
Total operating revenues3,854 3,269 847 956 13 (5)8,934 
Claims, benefits and expenses      
Net incurred claims and benefits1,360 1,916 487 884 36 — 4,683 
Policyholders’ dividends5 15 — — — — 20 
Amortization of deferred acquisition costs488 467 146 — — — 1,101 
Non-insurance warranty expense1,092 — — — — — 1,092 
Other insurance related expenses250 409 112 89 4 (1)863 
Other expenses40 21 25 7 133 (4)222 
Total claims, benefits and expenses3,235 2,828 770 980 173 (5)7,981 
Core income (loss) before income tax619 441 77 (24)(160)— 953 
Income tax (expense) benefit on core income (loss)(134)(91)(14)31 29 — (179)
Core income (loss) $485 $350 $63 $7 $(131)$— 774 
Net investment gains (losses)(166)
Income tax (expense) benefit on net investment gains (losses)38 
Net investment gains (losses), after tax(128)
Net income (loss)$646 

September 30, 2022
(In millions)      
Reinsurance receivables$1,511 $952 $385 $453 $2,420 $— $5,721 
Insurance receivables1,061 1,640 309 4 — — 3,014 
Deferred acquisition costs379 315 93 — — — 787 
Goodwill117 — 25 — — — 142 
Deferred non-insurance warranty acquisition expense3,653 — — — — — 3,653 
Insurance reserves 
Claim and claim adjustment expenses6,925 9,172 2,262 3,645 2,696 — 24,700 
Unearned premiums3,144 2,364 576 111 — — 6,195 
Future policy benefits— — — 10,454 — — 10,454 
Deferred non-insurance warranty revenue4,706 — — — — — 4,706 
Nine months ended September 30, 2021
Specialty
Commercial		InternationalLife &
Group		Corporate
& Other		  
(In millions)EliminationsTotal
Operating revenues 
Net earned premiums$2,270 $2,629 $789 $369 $— $(1)$6,056 
Net investment income367 463 42 724 12 — 1,608 
Non-insurance warranty revenue1,054 — — — — — 1,054 
Other revenues1 17 1 (1)5 (4)19 
Total operating revenues3,692 3,109 832 1,092 17 (5)8,737 
Claims, benefits and expenses    
Net incurred claims and benefits1,312 1,947 485 899 23 — 4,666 
Policyholders’ dividends2 16 — — — — 18 
Amortization of deferred acquisition costs478 449 157 — — — 1,084 
Non-insurance warranty expense973 — — — — — 973 
Other insurance related expenses212 376 106 77 9 (1)779 
Other expenses36 28 (4)5 119 (4)180 
Total claims, benefits and expenses3,013 2,816 744 981 151 (5)7,700 
Core income (loss) before income tax679 293 88 111 (134)— 1,037 
Income tax (expense) benefit on core income (loss)(148)(60)(21)9 24 — (196)
Core income (loss)$531 $233 $67 $120 $(110)$— 841 
Net investment gains (losses)117 
Income tax (expense) benefit on net investment gains (losses)(22)
Net investment gains (losses), after tax95 
Net income (loss)$936 

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 September 30Three MonthsNine Months
(In millions)2022202120222021
Specialty
Management & Professional Liability$688 $684 $2,041 $2,044 
Surety171 157 481 454 
Warranty & Alternative Risks451 406 1,332 1,194 
Specialty revenues1,310 1,247 3,854 3,692 
Commercial
Middle Market397 363 1,133 1,119 
Construction372 345 1,046 978 
Small Business149 144 430 413 
Other Commercial230 189 660 599 
Commercial revenues1,148 1,041 3,269 3,109 
International
Canada93 87 272 253 
Europe112 123 350 349 
Hardy81 75 225 230 
International revenues286 285 847 832 
Life & Group revenues305 362 956 1,092 
Corporate & Other revenues 6 4 13 17 
Eliminations(2)(2)(5)(5)
Total operating revenues3,053 2,937 8,934 8,737 
Net investment gains (losses)(96)22 (166)117 
Total revenues$2,957 $2,959 $8,768 $8,854