CNA Financial Corporation Q1 FY2026 earnings call

Core income was $225 million in the first quarter. P&C expense ratio was 29.9%, down 0.3 points from prior year. Net investment income was $610 million, up slightly from prior year quarter. Balance sheet remained very strong with stockholders' equity excluding AOCI at $12.2 billion. Operating cash flow was $393 million. Announced regular quarterly dividend of $0.48 per share.

For the Commercial segment, the all-in combined ratio was 103.5% compared to 101.1% in the prior year quarter. Catastrophe impacts were $93 million or 6.4 points on the combined ratio. Unfavorable prior period development of $56 million added 4.0 points to the combined ratio. The underlying combined ratio was 93.1% compared to 91.0% in the prior year quarter. The underlying loss ratio increased to 65.8%, from 63.4% in the fourth quarter and 62.9% in the prior year quarter. Net written premium declined 1% and new business growth was flat. Retention was 81%. Rate change was 2%. For the Specialty segment, the all-in combined ratio was 102.7% compared to 95.1% in the prior year quarter. Prior period development was unfavorable by $50 million or 5.9 points of the combined ratio. The underlying combined ratio was 96.8% compared to 93.8% in the prior year quarter. The underlying loss ratio was 62.8%, up from 60.6% in the fourth quarter and 60.1% in the prior year quarter. Net written premium declined 1% in the quarter. New business was up 13% and retention was 86%. Rate remained consistent at 3%. For the International segment, the all-in combined ratio was 95.9% with 1.2 points of catastrophe losses. The underlying combined ratio was 94.7%. The underlying loss ratio was 59.8% compared to 58.5% in the prior year quarter. Net written premium grew 16% in the quarter, or 7% excluding currency fluctuation. New business grew 2% and retention was 85%. Rates were down 4%.

Expect income from fixed income and other investments to be about $575 million in the second quarter. For full year, expect income from fixed income and other investments to be about $2,300 million, a 2% increase compared to 2025. May see similar volatility in limited partnership and common stock portfolio results in near term due to public equity market volatility.

Social inflation not abating, continued impacts of increased attorney involvement and lengthening development patterns reflected in reserves and loss ratio. Significant variation by segment and class of business due to competitive environment. Rate and premium change varying by segment, with some segments facing competitive headwinds.