Item 1. Financial Statements (unaudited)

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Item 1. Financial Statements (unaudited)

Cincinnati Financial Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

(Dollars in millions, except per share data)June 30,December 31,
20242023
Assets
Investments
Fixed maturities, at fair value (amortized cost: 2024—$15,109; 2023—$14,361)$14,409$13,791
Equity securities, at fair value (cost: 2024—$4,278; 2023—$4,282)11,63410,989
Other invested assets641577
Total investments26,68425,357
Cash and cash equivalents771907
Investment income receivable201192
Finance receivable111108
Premiums receivable3,0912,592
Reinsurance recoverable546651
Prepaid reinsurance premiums12155
Deferred policy acquisition costs1,2291,093
Land, building and equipment, net, for company use (accumulated depreciation: 2024—$337; 2023—$337)213208
Other assets887681
Separate accounts948925
Total assets$34,802$32,769
Liabilities
Insurance reserves
Loss and loss expense reserves$9,555$9,050
Life policy and investment contract reserves2,9663,068
Unearned premiums4,8264,119
Other liabilities1,3911,311
Deferred income tax1,4651,324
Note payable2525
Long-term debt and lease obligations849849
Separate accounts948925
Total liabilities22,02520,671
Commitments and contingent liabilities (Note 12)
Shareholders' Equity
Common stock, par value—$2 per share; (authorized: 2024 and 2023—500 million shares; issued: 2024 and 2023—198.3 million shares)397397
Paid-in capital1,4661,437
Retained earnings13,89713,084
Accumulated other comprehensive loss(470)(435)
Treasury stock at cost (2024—42.1 million shares and 2023—41.3 million shares)(2,513)(2,385)
Total shareholders' equity12,77712,098
Total liabilities and shareholders' equity$34,802$32,769

Accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

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Cincinnati Financial Corporation and Subsidiaries

Condensed Consolidated Statements of Income

(Dollars in millions, except per share data)Three months ended June 30,Six months ended June 30,
2024202320242023
Revenues
Earned premiums$2,156$1,943$4,227$3,861
Investment income, net of expenses242220487430
Investment gains and losses, net137434749540
Fee revenues56910
Other revenues4275
Total revenues2,5442,6055,4794,846
Benefits and Expenses
Insurance losses and contract holders' benefits1,4801,3402,8292,738
Underwriting, acquisition and insurance expenses6555791,2711,135
Interest expense14132727
Other operating expenses971312
Total benefits and expenses2,1581,9394,1403,912
Income Before Income Taxes3866661,339934
Provision for Income Taxes
Current615112267
Deferred1381150108
Total provision for income taxes74132272175
Net Income$312$534$1,067$759
Per Common Share
Net income — basic$1.99$3.40$6.82$4.83
Net income — diluted1.983.386.774.80

Accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

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Cincinnati Financial Corporation and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Net Income$312$534$1,067$759
Other Comprehensive Income (Loss)
Change in unrealized gains and losses on investments, net of tax (benefit) of $(17), $(32), $(28) and $3, respectively(58)(122)(102)6
Amortization of pension actuarial loss (gain) and prior service cost, net of tax (benefit) of $0, $(1), $0 and $(2), respectively1—1(5)
Change in life policy reserves, reinsurance recoverable and other, net of tax (benefit) of $8, $6, $18 and $(3), respectively292366(13)
Other comprehensive loss(28)(99)(35)(12)
Comprehensive Income$284$435$1,032$747

Accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

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Cincinnati Financial Corporation and Subsidiaries

Condensed Consolidated Statements of Shareholders' Equity

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Common Stock
Beginning of period$397$397$397$397
Share-based awards————
End of period397397397397
Paid-In Capital
Beginning of period1,4461,3981,4371,392
Share-based awards6——(6)
Share-based compensation12102622
Other2232
End of period1,4661,4101,4661,410
Retained Earnings
Beginning of period13,71211,81813,08411,711
Net income3125341,067759
Dividends declared(127)(117)(254)(235)
End of period13,89712,23513,89712,235
Accumulated Other Comprehensive Loss
Beginning of period(442)(527)(435)(614)
Other comprehensive loss(28)(99)(35)(12)
End of period(470)(626)(470)(626)
Treasury Stock
Beginning of period(2,459)(2,345)(2,385)(2,324)
Share-based awards4—127
Shares acquired - share repurchase authorization(46)(42)(121)(67)
Shares acquired - share-based compensation plans(12)—(19)(3)
Other—1—1
End of period(2,513)(2,386)(2,513)(2,386)
Total Shareholders' Equity$12,777$11,030$12,777$11,030
(In millions, except per common share)
Common Stock - Shares Outstanding
Beginning of period156.5157.2157.0157.1
Share-based awards0.1—0.40.3
Shares acquired - share repurchase authorization(0.4)(0.4)(1.1)(0.6)
Shares acquired - share-based compensation plans——(0.1)—
End of period156.2156.8156.2156.8
Dividends declared per common share$0.81$0.75$1.62$1.50

Accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

Cincinnati Financial Corporation Second-Quarter 2024 10-Q

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Cincinnati Financial Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Dollars in millions)Six months ended June 30,
20242023
Cash Flows From Operating Activities
Net income$1,067$759
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and other7674
Investment gains and losses, net(744)(526)
Interest credited to contract holders2221
Deferred income tax expense150108
Changes in:
Premiums and reinsurance receivable(464)(504)
Deferred policy acquisition costs(136)(96)
Other assets(16)(17)
Loss and loss expense reserves505473
Life policy and investment contract reserves3456
Unearned premiums707533
Other liabilities(34)(27)
Current income tax receivable/payable(72)(29)
Net cash provided by operating activities1,095825
Cash Flows From Investing Activities
Sale, call or maturity of fixed maturities852581
Sale of equity securities3474
Purchase of fixed maturities(1,623)(1,313)
Purchase of equity securities(256)(97)
Changes in finance receivables(4)(6)
Investment in building and equipment(12)(8)
Change in other invested assets, net(44)(81)
Net cash used in investing activities(740)(920)
Cash Flows From Financing Activities
Payment of cash dividends to shareholders(241)(223)
Shares acquired - share repurchase authorization(121)(66)
Changes in note payable—(25)
Proceeds from stock options exercised46
Contract holders' funds deposited3945
Contract holders' funds withdrawn(105)(113)
Other(67)(45)
Net cash used in financing activities(491)(421)
Net change in cash and cash equivalents(136)(516)
Cash and cash equivalents at beginning of year9071,264
Cash and cash equivalents at end of period$771$748
Supplemental Disclosures of Cash Flow Information:
Interest paid$27$27
Income taxes paid17479
Noncash Activities
Equipment acquired under finance lease obligations$9$4
Share-based compensation3313
Other assets and other liabilities21765

Accompanying Notes are an integral part of these Condensed Consolidated Financial Statements.

Cincinnati Financial Corporation Second-Quarter 2024 10-Q

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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

NOTE 1 — Accounting Policies

The condensed consolidated financial statements include the accounts of Cincinnati Financial Corporation and its consolidated subsidiaries, each of which is wholly owned. These statements are presented in conformity with accounting principles generally accepted in the United States of America (GAAP). All intercompany balances and transactions have been eliminated in consolidation.

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect amounts reported in the financial statements and accompanying notes. Our actual results could differ from those estimates. Certain financial information that is normally included in annual financial statements prepared in accordance with GAAP, but that is not required for interim reporting purposes, has been condensed or omitted.

Our June 30, 2024, condensed consolidated financial statements are unaudited. We believe that we have made all adjustments, consisting only of normal recurring accruals, that are necessary for fair presentation. These condensed consolidated financial statements should be read in conjunction with our consolidated financial statements included in our 2023 Annual Report on Form 10-K. The results of operations for interim periods do not necessarily indicate results to be expected for the full year.

Pending Accounting Updates

ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures

In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. ASU 2023-07 enhances reportable segment disclosures by requiring entities to disclose significant segment expenses that are regularly provided to the chief operating decision maker (CODM) and included within the reported measure of profit or loss. This ASU also requires disclosure of the title and position of the CODM as well as a description of how the reported measure of profit or loss is used to assess segment performance and allocate resources. The effective date of ASU 2023-07 is for annual reporting periods beginning after December 15, 2023, and interim reporting periods within annual periods beginning after December 15, 2024, and should be applied retrospectively to all prior periods presented. The ASU has not yet been adopted and will not have a material impact on our company’s consolidated financial position, results of operations or cash flows, but the ASU will require additional disclosures in our annual and interim financial statements.

ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. ASU 2023-09 enhances the transparency and decision usefulness of income tax disclosures by requiring entities to disclose specific categories within their rate reconciliation as well as additional items within those categories above a prescribed threshold. This ASU also requires disclosure of the amount of income taxes paid (net of refunds received) disaggregated by federal, state and foreign taxes as well as additional items within those categories above a prescribed threshold. The effective date of ASU 2023-09 is for annual reporting periods beginning after December 15, 2024, and should be applied prospectively with retrospective application permitted. The ASU has not yet been adopted and will not have a material impact on our company’s consolidated financial position, results of operations or cash flows, but the ASU will require additional disclosures in our annual financial statements.

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NOTE 2 – Investments

The following table provides amortized cost, gross unrealized gains, gross unrealized losses and fair value for our fixed-maturity securities:

(Dollars in millions)Amortized costGross unrealizedFair value
At June 30, 2024gainslosses
Fixed-maturity securities:
Corporate$8,151$49$475$7,725
States, municipalities and political subdivisions4,867172734,611
Government-sponsored enterprises1,611151,607
Asset-backed257—10247
United States government190—4186
Foreign government33——33
Total$15,109$67$767$14,409
At December 31, 2023
Fixed-maturity securities:
Corporate$7,836$70$454$7,452
States, municipalities and political subdivisions4,867442084,703
Government-sponsored enterprises1,227361,224
Asset-backed203—16187
United States government203—3200
Foreign government25——25
Total$14,361$117$687$13,791

The increase in net unrealized investment losses in our fixed-maturity portfolio at June 30, 2024, is primarily due to an increase in U.S. Treasury yields. Our asset-backed securities had an average rating of Aa3/AA- at both June 30, 2024, and December 31, 2023.

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The table below provides fair values and gross unrealized losses by investment category and by the duration of the securities' continuous unrealized loss positions:

(Dollars in millions)Less than 12 months12 months or moreTotal
At June 30, 2024Fair valueUnrealized lossesFair valueUnrealized lossesFair valueUnrealized losses
Fixed-maturity securities:
Corporate$1,004$17$5,413$458$6,417$475
States, municipalities and political subdivisions1,390202,0902533,480273
Government-sponsored enterprises819224231,0615
Asset-backed54—1191017310
United States government78—10141794
Foreign government25—7—32—
Total$3,370$39$7,972$728$11,342$767
At December 31, 2023
Fixed-maturity securities:
Corporate$379$13$5,560$441$5,939$454
States, municipalities and political subdivisions31321,9322062,245208
Government-sponsored enterprises652311337656
Asset-backed5—1721617716
United States government32—12931613
Foreign government3—6—9—
Total$1,384$18$7,912$669$9,296$687

Contractual maturity dates for fixed-maturities securities were:

(Dollars in millions)Amortized costFair value% of fair value
At June 30, 2024
Maturity dates:
Due in one year or less$1,181$1,1718.1%
Due after one year through five years4,2434,11828.6
Due after five years through ten years3,5443,39923.6
Due after ten years6,1415,72139.7
Total$15,109$14,409100.0%

Actual maturities may differ from contractual maturities when there is a right to call or prepay obligations with or without call or prepayment penalties.

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The following table provides investment income and investment gains and losses, net:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Investment income:
Interest$173$147$342$287
Dividends6970141136
Other461113
Total246223494436
Less investment expenses4376
Total$242$220$487$430
Investment gains and losses, net:
Equity securities:
Investment gains and losses on securities sold, net$7$—$4$(4)
Unrealized gains and losses on securities still held, net142459747568
Subtotal149459751564
Fixed-maturity securities:
Gross realized gains4—41
Gross realized losses(6)—(7)(1)
Change in allowance for credit losses, net(16)(3)(25)(3)
Write-down of impaired securities with intent to sell—(4)—(4)
Subtotal(18)(7)(28)(7)
Other6(18)26(17)
Total$137$434$749$540

The fair value of our equity portfolio was $11.634 billion and $10.989 billion at June 30, 2024, and December 31, 2023, respectively. Microsoft Corporation (Nasdaq:MSFT), an equity holding, was our largest single investment holding with a fair value of $1.001 billion and $842 million, which was 8.9% and 7.9% of our publicly traded common equities portfolio and 3.8% and 3.4% of the total investment portfolio at June 30, 2024, and December 31, 2023, respectively.

The allowance for credit losses on fixed-maturity securities was $43 million and $18 million at June 30, 2024, and December 31, 2023, respectively.

There were 3,784 and 2,840 fixed-maturity securities in a total unrealized loss position of $767 million and $687 million at June 30, 2024, and December 31, 2023, respectively. Of those totals, 16 and 20 fixed-maturity securities had fair values below 70% of amortized cost at June 30, 2024, and December 31, 2023, respectively.

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NOTE 3 – Fair Value Measurements

In accordance with accounting guidance for fair value measurements and disclosures, we categorized our financial instruments, based on the priority of the observable and market-based data for the valuation technique used, into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices with readily available independent data in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable market inputs (Level 3). When various inputs for measurement fall within different levels of the fair value hierarchy, the lowest observable input that has a significant impact on fair value measurement is used. Our valuation techniques have not changed from those used at December 31, 2023, and ultimately management determines fair value. See our 2023 Annual Report on Form 10-K, Item 8, Note 3, Fair Value Measurements, Page 139, for information on characteristics and valuation techniques used in determining fair value.

Fair Value Disclosures for Assets

The following tables illustrate the fair value hierarchy for those assets measured at fair value on a recurring basis at June 30, 2024, and December 31, 2023. We do not have any liabilities carried at fair value.

(Dollars in millions)Level 1Level 2Level 3Total
At June 30, 2024
Fixed maturities, available for sale:
Corporate$—$7,725$—$7,725
States, municipalities and political subdivisions—4,611—4,611
Government-sponsored enterprises—1,607—1,607
Asset-backed—247—247
United States government186——186
Foreign government—33—33
Subtotal18614,223—14,409
Common equities11,283——11,283
Nonredeemable preferred equities—351—351
Separate accounts taxable fixed maturities—882—882
Top Hat savings plan mutual funds and common equity (included in Other assets)77——77
Total$11,546$15,456$—$27,002
At December 31, 2023
Fixed maturities, available for sale:
Corporate$—$7,452$—$7,452
States, municipalities and political subdivisions—4,703—4,703
Government-sponsored enterprises—1,224—1,224
Asset-backed—187—187
United States government200——200
Foreign government—25—25
Subtotal20013,591—13,791
Common equities10,641——10,641
Nonredeemable preferred equities—348—348
Separate accounts taxable fixed maturities—854—854
Top Hat savings plan mutual funds and common equity (included in Other assets)67——67
Total$10,908$14,793$—$25,701

We also held Level 1 cash and cash equivalents of $771 million and $907 million at June 30, 2024, and December 31, 2023, respectively.

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Fair Value Disclosures for Assets and Liabilities Not Carried at Fair Value

The disclosures below are presented to provide information about the effects of current market conditions on financial instruments that are not reported at fair value in our condensed consolidated financial statements.

This table summarizes the book value and principal amounts of our long-term debt:

(Dollars in millions)Book valuePrincipal amount
Interest rateYear of issueJune 30,December 31,June 30,December 31,
2024202320242023
6.900%1998Senior debentures, due 2028$27$27$28$28
6.920%2005Senior debentures, due 2028391391391391
6.125%2004Senior notes, due 2034372372374374
Total$790$790$793$793

The following table shows fair values of our note payable and long-term debt:

(Dollars in millions)Level 1Level 2Level 3Total
At June 30, 2024
Note payable$—$25$—$25
6.900% senior debentures, due 2028—29—29
6.920% senior debentures, due 2028—414—414
6.125% senior notes, due 2034—390—390
Total$—$858$—$858
At December 31, 2023
Note payable$—$25$—$25
6.900% senior debentures, due 2028—29—29
6.920% senior debentures, due 2028—420—420
6.125% senior notes, due 2034—394—394
Total$—$868$—$868

The following table shows the fair value of our life policy loans included in other invested assets and the fair values of our deferred annuities and structured settlements included in life policy and investment contract reserves:

(Dollars in millions)Level 1Level 2Level 3Total
At June 30, 2024
Life policy loans$—$—$40$40
Deferred annuities——574574
Structured settlements—131—131
Total$—$131$574$705
At December 31, 2023
Life policy loans$—$—$39$39
Deferred annuities——603603
Structured settlements—141—141
Total$—$141$603$744

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Outstanding principal and interest for these life policy loans totaled $35 million and $33 million at June 30, 2024, and December 31, 2023, respectively.

Recorded reserves for the deferred annuities were $618 million and $656 million at June 30, 2024, and December 31, 2023, respectively. Recorded reserves for the structured settlements were $119 million and $123 million at June 30, 2024, and December 31, 2023, respectively.

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NOTE 4 – Property Casualty Loss and Loss Expenses

This table summarizes activity for our consolidated property casualty loss and loss expense reserves:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Gross loss and loss expense reserves, beginning of period$9,178$8,626$8,975$8,336
Less reinsurance recoverable332424362405
Net loss and loss expense reserves, beginning of period8,8468,2028,6137,931
Net incurred loss and loss expenses related to:
Current accident year1,4521,3632,8222,739
Prior accident years(40)(101)(140)(160)
Total incurred1,4121,2622,6822,579
Net paid loss and loss expenses related to:
Current accident year483502688689
Prior accident years5845791,4161,438
Total paid1,0671,0812,1042,127
Net loss and loss expense reserves, end of period9,1918,3839,1918,383
Plus reinsurance recoverable303424303424
Gross loss and loss expense reserves, end of period$9,494$8,807$9,494$8,807

We use actuarial methods, models and judgment to estimate, as of a financial statement date, the property casualty loss and loss expense reserves required to pay for and settle all outstanding insured claims, including incurred but not reported (IBNR) claims, as of that date. The actuarial estimate is subject to review and adjustment by an inter-departmental committee that includes actuarial, claims, underwriting, loss prevention and accounting management. This committee is familiar with relevant company and industry business, claims and underwriting trends, as well as general economic and legal trends that could affect future loss and loss expense payments. The amount we will actually have to pay for claims can be highly uncertain. This uncertainty, together with the size of our reserves, makes the loss and loss expense reserves our most significant estimate. The reserve for loss and loss expenses in the condensed consolidated balance sheets also included $61 million and $66 million at June 30, 2024, and 2023, respectively, for certain life and health loss and loss expense reserves.

We experienced $40 million of favorable development on prior accident years, including $29 million of favorable development in commercial lines, $6 million of unfavorable development in personal lines and $3 million of unfavorable development in excess and surplus lines for the three months ended June 30, 2024. Within commercial lines, we recognized favorable reserve development of $28 million for the workers' compensation line and $21 million for the commercial property line due to reduced uncertainty of prior accident year loss and loss adjustment expense for these lines. This was partially offset by unfavorable reserve development of $28 million for the commercial casualty line. Within personal lines, we recognized unfavorable reserve development of $12 million for the personal auto line.

We experienced $140 million of favorable development on prior accident years, including $67 million of favorable development in commercial lines, $27 million of favorable development in personal lines and no net development in excess and surplus lines for the six months ended June 30, 2024. Within commercial lines, we recognized favorable reserve development of $44 million for the commercial property line, $40 million for the workers' compensation line and $11 million for the commercial auto line due to reduced uncertainty of prior accident year loss and loss adjustment expense for these lines. This was partially offset by unfavorable reserve development of $29 million for the commercial casualty line. Within personal lines, we recognized favorable reserve development of $27 million for the homeowner line.

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We experienced $101 million of favorable development on prior accident years, including $59 million of favorable development in commercial lines, $15 million of favorable development in personal lines and $5 million of favorable development in excess and surplus lines for the three months ended June 30, 2023. Within commercial lines, we recognized favorable reserve development of $34 million for the commercial casualty line and $11 million for the workers' compensation line due to reduced uncertainty of prior accident year loss and loss adjustment expense for these lines.

We experienced $160 million of favorable development on prior accident years, including $91 million of favorable development in commercial lines, $46 million of favorable development in personal lines and $14 million of favorable development in excess and surplus lines for the six months ended June 30, 2023. Within commercial lines, we recognized favorable reserve development of $36 million for the commercial casualty line, $26 million for the workers' compensation line and $25 million for the commercial property line due to reduced uncertainty of prior accident year loss and loss adjustment expense for these lines. Within personal lines, we recognized favorable reserve development of $35 million for the homeowner line and $12 million for the personal auto line.

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NOTE 5 – Life Policy and Investment Contract Reserves

We establish the reserves for traditional life policies including term, whole life and other products based on the present value of future benefits and claim expenses less the present value of future net premiums. Net premium is the portion of gross premium required to provide for all benefits and claim expenses. We estimate future benefits and claim expenses and net premium using certain cash flow assumptions including mortality, morbidity and lapse rates as well as a discount rate assumption. The cash flow assumptions are established based on our current expectations and are reviewed annually to determine any necessary updates. These assumptions are also updated on an interim basis if evidence suggests that they should be revised. We use both our own experience and industry experience, adjusted for historical trends, in arriving at our cash flow assumptions. The discount rate assumption is based on upper-medium grade fixed-income instrument yields (market value discount rates) and is updated quarterly. Certain assumptions, including the mortality, lapse and long-term interest rate reversion targets, were updated in the second quarter of 2024 as part of our annual assumption unlocking. Changes in the inputs, judgments and assumptions during the period and the related measurement impact on the liability are reflected in the below tables.

We establish reserves for our universal life, deferred annuity and other investment contracts equal to the cumulative account balances, which include premium deposits plus credited interest less charges and withdrawals. Some of our universal life policies contain no-lapse guarantee provisions. For these policies, we establish a reserve in addition to the account balance, based on expected no-lapse guarantee benefits and expected policy assessments.

The following table summarizes our life policy and investment contract reserves and provides a reconciliation of the balances described in the below tables to those in the condensed consolidated balance sheets:

(Dollars in millions)June 30, 2024December 31, 2023
Life policy reserves:
Term$1,035$1,066
Whole life404434
Other9997
Subtotal1,5381,597
Investment contract reserves:
Deferred annuities618656
Universal life584585
Structured settlements119123
Other107107
Subtotal1,4281,471
Total life policy and investment contract reserves$2,966$3,068

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The balances and changes in the term and whole life policy reserves included in life policy and investment contract reserves is as follows:

(Dollars in millions)Three months ended June 30,
20242023
TermWhole lifeTermWhole life
Present value of expected net premiums:
Balance, beginning of period$1,660$219$1,699$217
Beginning balance at original discount rate1,7102251,715220
Effect of changes in cash flow assumptions(12)1(5)(6)
Effect of actual variances from expected experience(10)(3)(9)—
Adjusted beginning of period balance1,6882231,701214
Issuances4164010
Interest accrual183172
Net premiums collected(46)(7)(46)(7)
Ending balance at original discount rate1,7012251,712219
Effect of changes in discount rate assumptions(81)(10)(48)(7)
Balance, end of period1,6202151,664212
Present value of expected future policy benefits:
Balance, beginning of period2,6986372,691644
Beginning balance at original discount rate2,7806332,712614
Effect of changes in cash flow assumptions(29)25(10)
Effect of actual variances from expected experience(14)(4)(11)—
Adjusted beginning of period balance2,7376312,706604
Issuances4174011
Interest accrual318307
Benefits paid(37)(10)(39)(7)
Ending balance at original discount rate2,7726362,737615
Effect of changes in discount rate assumptions(138)(17)(75)18
Balance, end of period2,6346192,662633
Net liability for future policy benefits:
Present value of expected future policy benefits less expected net premiums1,014404998421
Impact of flooring at cohort level21—17—
Net life policy reserves1,0354041,015421
Less reinsurance recoverable at original discount rate(95)(24)(100)(25)
Less effect of discount rate assumption changes on reinsurance recoverable(7)(4)(8)(5)
Net life policy reserves, after reinsurance recoverable$933$376$907$391
Weighted-average duration of the net life policy reserves in years11151216

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(Dollars in millions)Six months ended June 30,
20242023
TermWhole lifeTermWhole life
Present value of expected net premiums:
Balance, beginning of period$1,700$223$1,643$208
Beginning balance at original discount rate1,7122251,708217
Effect of changes in cash flow assumptions(12)1(5)(6)
Effect of actual variances from expected experience(19)(3)(12)1
Adjusted beginning of period balance1,6812231,691212
Issuances76117817
Interest accrual365354
Net premiums collected(92)(14)(92)(14)
Ending balance at original discount rate1,7012251,712219
Effect of changes in discount rate assumptions(81)(10)(48)(7)
Balance, end of period1,6202151,664212
Present value of expected future policy benefits:
Balance, beginning of period2,7516572,584614
Beginning balance at original discount rate2,7656282,692607
Effect of changes in cash flow assumptions(29)25(10)
Effect of actual variances from expected experience(28)(4)(13)1
Adjusted beginning of period balance2,7086262,684598
Issuances76127817
Interest accrual62166015
Benefits paid(74)(18)(85)(15)
Ending balance at original discount rate2,7726362,737615
Effect of changes in discount rate assumptions(138)(17)(75)18
Balance, end of period2,6346192,662633
Net liability for future policy benefits:
Present value of expected future policy benefits less expected net premiums1,014404998421
Impact of flooring at cohort level21—17—
Net life policy reserves1,0354041,015421
Less reinsurance recoverable at original discount rate(95)(24)(100)(25)
Less effect of discount rate assumption changes on reinsurance recoverable(7)(4)(8)(5)
Net life policy reserves, after reinsurance recoverable$933$376$907$391
Weighted-average duration of the net life policy reserves in years11151216

The total impact of flooring at cohort level in the above tables includes the effect of discount rate assumption changes of $3 million at both June 30, 2024 and 2023.

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The following table shows the amount of undiscounted and discounted expected future benefit payments and expected gross premiums for our term and whole life policies:

(Dollars in millions)At June 30,
20242023
UndiscountedDiscountedUndiscountedDiscounted
Term
Expected future benefit payments$4,819$2,634$4,738$2,662
Expected future gross premiums4,5132,5974,3452,583
Whole life
Expected future benefit payments$1,680$619$1,610$633
Expected future gross premiums675401641390

The following table shows the amount of revenue and interest recognized in the condensed consolidated statements of income related to our term and whole life policies:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Gross premiums
Term$75$73$149$146
Whole life13132625
Total$88$86$175$171
Interest accretion
Term$13$12$26$24
Whole life551111
Total$18$17$37$35

Adverse development that resulted in an immediate charge to income due to net premiums exceeding gross premiums was immaterial for the six months ended June 30, 2024, and 2023.

The following table shows the weighted-average interest rate for our term and whole life products:

At June 30,
20242023
Term
Interest accretion rate5.22%5.29%
Current discount rate5.245.11
Whole life
Interest accretion rate5.90%5.93%
Current discount rate5.675.22

The discount rate assumption was developed by calculating forward rates from market yield curves of upper-medium grade fixed-income instruments.

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The following table shows the balances and changes in policyholders' account balances included in investment contract reserves:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Deferred annuityUniversal lifeDeferred annuityUniversal lifeDeferred annuityUniversal lifeDeferred annuityUniversal life
Balance, beginning of period$631$456$711$458$656$457$734$457
Premiums received10915919192520
Policy charges—(10)—(10)—(20)—(20)
Surrenders and withdrawals(26)(3)(32)(4)(63)(7)(68)(7)
Benefit payments(2)(1)(3)(2)(5)(3)(6)(4)
Interest credited555511101110
Balance, end of period$618$456$696$456$618$456$696$456
Weighted average crediting rate3.59%4.33%3.41%4.29%3.59%4.33%3.41%4.29%
Net amount at risk$—$3,892$—$4,030$—$3,892$—$4,030
Cash surrender value612425691423612425691423

The net amount at risk above represents the guaranteed benefit amount in excess of the current account balances.

The following table shows the balance of account values by range of guaranteed minimum crediting rates, in basis points, and the related range of the difference between rates being credited to policyholders and the respective guaranteed minimums for our deferred annuity and universal life contracts:

(Dollars in millions)At guaranteed minimum1 to 50 basis points above51-150 basis points aboveGreater than 150 basis pointsTotal
At June 30, 2024
Deferred annuity
1.00-3.00%$4$324$14$228$570
3.01-4.00%48———48
Total$52$324$14$228$618
Universal life
1.00-3.00%$—$60$59$4$123
3.01-4.00%495——54
Greater than 4.00%279———279
Total$328$65$59$4$456
At June 30, 2023
Deferred annuity
1.00-3.00%$5$400$17$224$646
3.01-4.00%50———50
Total$55$400$17$224$696
Universal life
1.00-3.00%$61$—$56$3$120
3.01-4.00%53———53
Greater than 4.00%283———283
Total$397$—$56$3$456

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The following table shows the balances and changes in the other additional liability related to the no-lapse guarantees contained within our universal life contracts:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Balance, beginning of period$129$125$128$121
Balance, beginning of period before shadow reserve adjustments130127129123
Effect of changes in cash flow assumptions(2)(5)(2)(5)
Effect of actual variances from expected experience———(1)
Adjusted beginning of period balance128122127117
Interest accrual1122
Excess death benefits(1)(2)(3)(2)
Attributed assessments3366
Effect of changes in interest rate assumptions(1)—(2)1
Balance, end of period before shadow reserve adjustments130124130124
Shadow reserve adjustments(2)(2)(2)(2)
Balance, end of period128122128122
Less reinsurance recoverable, end of period6767
Net other additional liability, after reinsurance recoverable$134$129$134$129
Weighted-average duration of the other additional liability in years29322932

The following table shows balances and changes in separate accounts balances during the period:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Balance, beginning of period$927$899$925$892
Interest credited before policy charges11102120
Benefit payments(3)(1)(3)(3)
Other13352
Balance, end of period$948$911$948$911
Cash surrender value$932$906$932$906

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NOTE 6 – Deferred Policy Acquisition Costs

Expenses directly related to successfully acquired insurance policies – primarily commissions, premium taxes and underwriting costs – are deferred and amortized over the terms of the policies. We update our acquisition cost assumptions periodically to reflect actual experience. For property casualty, we evaluate the costs for recoverability. No premium deficiencies were recorded in the condensed consolidated statements of income, as the sum of the anticipated loss and loss expenses, policyholder dividends and unamortized deferred acquisition expenses did not exceed the related unearned premiums and anticipated investment income.

The table below shows the deferred policy acquisition costs and asset reconciliation.

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Property casualty:
Deferred policy acquisition costs asset, beginning of period$796$714$749$682
Capitalized deferred policy acquisition costs475407882779
Amortized deferred policy acquisition costs(393)(350)(753)(690)
Deferred policy acquisition costs asset, end of period$878$771$878$771
Life:
Deferred policy acquisition costs asset, beginning of period$347$334$344$331
Capitalized deferred policy acquisition costs12112222
Amortized deferred policy acquisition costs(8)(7)(15)(15)
Deferred policy acquisition costs asset, end of period$351$338$351$338
Consolidated:
Deferred policy acquisition costs asset, beginning of period$1,143$1,048$1,093$1,013
Capitalized deferred policy acquisition costs487418904801
Amortized deferred policy acquisition costs(401)(357)(768)(705)
Deferred policy acquisition costs asset, end of period$1,229$1,109$1,229$1,109

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The table below shows the life deferred policy acquisition costs asset by product:

(Dollars in millions)
Three months ended June 30, 2024TermWhole lifeDeferred annuityUniversal lifeTotal
Balance, beginning of period$238$49$8$52$347
Capitalized deferred policy acquisition costs821112
Amortized deferred policy acquisition costs(5)(1)(1)(1)(8)
Balance, end of period$241$50$8$52$351
Three months ended June 30, 2023
Balance, beginning of period$231$44$7$52$334
Capitalized deferred policy acquisition costs721111
Amortized deferred policy acquisition costs(5)(1)—(1)(7)
Balance, end of period$233$45$8$52$338
(Dollars in millions)
Six months ended June 30, 2024TermWhole lifeDeferred annuityUniversal lifeTotal
Balance, beginning of period$236$48$8$52$344
Capitalized deferred policy acquisition costs1641122
Amortized deferred policy acquisition costs(11)(2)(1)(1)(15)
Balance, end of period$241$50$8$52$351
Six months ended June 30, 2023
Balance, beginning of period$228$43$7$53$331
Capitalized deferred policy acquisition costs1641122
Amortized deferred policy acquisition costs(11)(2)—(2)(15)
Balance, end of period$233$45$8$52$338

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NOTE 7 – Accumulated Other Comprehensive Income

Accumulated other comprehensive income (AOCI) includes changes in unrealized gains and losses on investments, changes in pension obligations and changes in life policy reserves, reinsurance recoverable and other as follows:

(Dollars in millions)Three months ended June 30,
20242023
Before taxIncome taxNetBefore taxIncome taxNet
Investments:
AOCI, beginning of period$(625)$(134)$(491)$(684)$(147)$(537)
OCI before investment gains and losses, net, recognized in net income(93)(21)(72)(158)(34)(124)
Investment gains and losses, net, recognized in net income18414422
OCI(75)(17)(58)(154)(32)(122)
AOCI, end of period$(700)$(151)$(549)$(838)$(179)$(659)
Pension obligations:
AOCI, beginning of period$30$8$22$30$8$22
OCI excluding amortization recognized in net income——————
Amortization recognized in net income1—1(1)(1)—
OCI1—1(1)(1)—
AOCI, end of period$31$8$23$29$7$22
Life policy reserves, reinsurance recoverable and other:
AOCI, beginning of period$34$7$27$(16)$(4)$(12)
OCI before investment gains and losses, net, recognized in net income3782929623
Investment gains and losses, net, recognized in net income——————
OCI3782929623
AOCI, end of period$71$15$56$13$2$11
Summary of AOCI:
AOCI, beginning of period$(561)$(119)$(442)$(670)$(143)$(527)
Investments OCI(75)(17)(58)(154)(32)(122)
Pension obligations OCI1—1(1)(1)—
Life policy reserves, reinsurance recoverable and other OCI3782929623
Total OCI(37)(9)(28)(126)(27)(99)
AOCI, end of period$(598)$(128)$(470)$(796)$(170)$(626)

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(Dollars in millions)Six months ended June 30,
20242023
Before taxIncome taxNetBefore taxIncome taxNet
Investments:
AOCI, beginning of period$(570)$(123)$(447)$(847)$(182)$(665)
OCI before investment gains and losses, net, recognized in net income(158)(34)(124)514
Investment gains and losses, net, recognized in net income28622422
OCI(130)(28)(102)936
AOCI, end of period$(700)$(151)$(549)$(838)$(179)$(659)
Pension obligations:
AOCI, beginning of period$30$8$22$36$9$27
OCI excluding amortization recognized in net income———(5)(1)(4)
Amortization recognized in net income1—1(2)(1)(1)
OCI1—1(7)(2)(5)
AOCI, end of period$31$8$23$29$7$22
Life policy reserves, reinsurance recoverable and other:
AOCI, beginning of period$(13)$(3)$(10)$29$5$24
OCI before investment gains and losses, net, recognized in net income841866(16)(3)(13)
Investment gains and losses, net, recognized in net income——————
OCI841866(16)(3)(13)
AOCI, end of period$71$15$56$13$2$11
Summary of AOCI:
AOCI, beginning of period$(553)$(118)$(435)$(782)$(168)$(614)
Investments OCI(130)(28)(102)936
Pension obligations OCI1—1(7)(2)(5)
Life policy reserves, reinsurance recoverable and other OCI841866(16)(3)(13)
Total OCI(45)(10)(35)(14)(2)(12)
AOCI, end of period$(598)$(128)$(470)$(796)$(170)$(626)

Investment gains and losses, net, and other investment gains and losses, net, are recorded in the investment gains and losses, net, line item in the condensed consolidated statements of income. Amortization of pension obligations is recorded in the insurance losses and contract holders' benefits and underwriting, acquisition and insurance expenses line items in the condensed consolidated statements of income.

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NOTE 8 – Reinsurance

Primary components of our property casualty reinsurance assumed operations include involuntary and voluntary assumed as well as contracts from our reinsurance assumed operations, known as Cincinnati Re. Primary components of our ceded reinsurance include a property per risk treaty, property excess treaty, casualty per occurrence treaty, casualty excess treaty, property catastrophe treaty and retrocessions on our reinsurance assumed operations. Management’s decisions about the appropriate level of risk retention are affected by various factors, including changes in our underwriting practices, capacity to retain risks and reinsurance market conditions.

The table below summarizes our consolidated property casualty insurance net written premiums, earned premiums and incurred loss and loss expenses:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Direct written premiums$2,362$2,071$4,487$3,930
Assumed written premiums236194475438
Ceded written premiums(139)(115)(255)(199)
Net written premiums$2,459$2,150$4,707$4,169
Direct earned premiums$2,015$1,806$3,949$3,566
Assumed earned premiums155134307293
Ceded earned premiums(95)(77)(189)(155)
Earned premiums$2,075$1,863$4,067$3,704
Direct incurred loss and loss expenses$1,352$1,265$2,545$2,564
Assumed incurred loss and loss expenses6358139134
Ceded incurred loss and loss expenses(3)(61)(2)(119)
Incurred loss and loss expenses$1,412$1,262$2,682$2,579

Our life insurance company purchases reinsurance for protection of a portion of the risks that are written. Primary components of our life reinsurance program include individual mortality coverage, aggregate catastrophe and accidental death coverage in excess of certain deductibles.

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The table below summarizes our consolidated life insurance earned premiums and contract holders' benefits incurred:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Direct earned premiums$101$100$200$196
Ceded earned premiums(20)(20)(40)(39)
Earned premiums$81$80$160$157
Direct contract holders' benefits incurred$76$100$170$197
Ceded contract holders' benefits incurred(8)(22)(23)(38)
Contract holders' benefits incurred$68$78$147$159

The ceded benefits incurred can vary depending on the type of life insurance policy held and the year the policy was issued.

The allowance for uncollectible property casualty premiums was $18 million and $16 million at June 30, 2024, and December 31, 2023, respectively. The allowances for credit losses on other premiums receivable and reinsurance recoverable assets were immaterial at June 30, 2024, and December 31, 2023.

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NOTE 9 – Income Taxes

The differences between the 21% statutory federal income tax rate and our effective income tax rate were as follows:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Tax at statutory rate:$8121.0%$14021.0%$28121.0%$19621.0%
Increase (decrease) resulting from:
Tax-exempt income from municipal bonds(6)(1.6)(5)(0.8)(11)(0.8)(10)(1.1)
Dividend received exclusion(5)(1.3)(6)(0.9)(10)(0.7)(11)(1.2)
Other41.130.5120.8——
Provision for income taxes$7419.2%$13219.8%$27220.3%$17518.7%

The provision for federal income taxes is based upon filing a consolidated income tax return for the company and its domestic subsidiaries.

We continue to believe that after considering all positive and negative evidence of taxable income in the carryback and carryforward periods as permitted by law, it is more likely than not that all of the deferred tax assets on our U.S. domestic operations and those related to Cincinnati Global Underwriting Ltd.SM (Cincinnati Global) will be realized. As a result, we have no valuation allowance for our U.S. domestic operations or Cincinnati Global at both June 30, 2024, and December 31, 2023.

Cincinnati Global

Cincinnati Global had no operating loss carryforwards in the United States and $85 million and $100 million in the United Kingdom at June 30, 2024, and December 31, 2023, respectively. These Cincinnati Global losses can only be utilized within the Cincinnati Global group.

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NOTE 10 – Net Income Per Common Share

Basic earnings per share are computed based on the weighted average number of common shares outstanding. Diluted earnings per share are computed based on the weighted average number of common and dilutive potential common shares outstanding using the treasury stock method. The table shows calculations for basic and diluted earnings per share:

(In millions, except per share data)Three months ended June 30,Six months ended June 30,
2024202320242023
Numerator:
Net income—basic and diluted$312$534$1,067$759
Denominator:
Basic weighted-average common shares outstanding156.3157.0156.6157.1
Effect of share-based awards:
Stock options0.70.60.70.8
Nonvested shares0.50.40.40.4
Diluted weighted-average shares157.5158.0157.7158.3
Earnings per share:
Basic$1.99$3.40$6.82$4.83
Diluted$1.98$3.38$6.77$4.80
Number of anti-dilutive share-based awards1.21.51.31.5

The source of dilution of our common shares are certain equity-based awards. See our 2023 Annual Report on Form 10-K, Item 8, Note 17, Share-Based Associate Compensation Plans, Page 177, for information about share-based awards. The above table shows the number of anti-dilutive share-based awards for the three and six months ended June 30, 2024 and 2023.

NOTE 11 – Employee Retirement Benefits

The following summarizes the components of net periodic benefit for our qualified and supplemental pension plans:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Service cost$2$2$3$3
Non-service (benefit) costs:
Interest cost3366
Expected return on plan assets(6)(5)(11)(10)
Amortization of actuarial loss (gain) and prior service cost1(1)1(2)
Other———(5)
Total non-service benefit(2)(3)(4)(11)
Net periodic benefit$—$(1)$(1)$(8)

See our 2023 Annual Report on Form 10-K, Item 8, Note 13, Employee Retirement Benefits, Page 170, for information on our retirement benefits. The net periodic benefit is allocated in the same proportion primarily to the underwriting, acquisition and insurance expenses line item with the remainder allocated to the insurance losses and contract holders' benefits line item on the condensed consolidated statements of income for both 2024 and 2023.

We made matching contributions totaling $7 million and $6 million to our 401(k) and Top Hat savings plans during the second quarter of 2024 and 2023, respectively, and contributions of $16 million and $14 million for the first half of 2024 and 2023, respectively.

We made no contributions to our qualified pension plan during the first six months of 2024.

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NOTE 12 – Commitments and Contingent Liabilities

The company, through its insurance subsidiaries, is involved in claims litigation arising in the ordinary course of conducting its business, both as a liability insurer defending or providing indemnity for third-party claims brought against insureds and as an insurer defending coverage claims brought against it. The company accounts for such activity through the establishment of unpaid loss and loss expense reserves. Subject to the uncertainties discussed in Note 4, Property Casualty Loss and Loss Expenses, and in the discussion in the balance of this Note, we believe that the ultimate liability, if any, with respect to such ordinary-course claims litigation, after consideration of provisions made for potential losses, costs of defense, and reinsurance recoveries, is immaterial to our consolidated financial position, results of operations and cash flows.

Beginning in April 2020, like many companies in the property casualty insurance industry, the company’s property casualty subsidiaries were named as defendants in lawsuits seeking insurance coverage under commercial property insurance policies issued by the company for alleged losses resulting from the shutdown or suspension of their businesses due to the COVID-19 pandemic. Although the allegations vary, the plaintiffs generally seek a declaration of insurance coverage, damages for breach of contract in unspecified amounts for claim denials, interest and attorney fees. Some of the lawsuits also allege that the insurance claims were denied in bad faith or otherwise in violation of state laws and seek extra-contractual or punitive damages.

The company denies the allegations in these lawsuits and continues to vigorously defend them. The company maintains that it has no coverage obligations with respect to these lawsuits for business income allegedly lost by the plaintiffs due to the COVID-19 pandemic based on the terms of the applicable insurance policies. Although the policy terms vary, in general, the claims at issue in these lawsuits were denied because the policyholder identified no direct physical loss or damage to property at the insured premises, and the governmental orders that led to the complete or partial shutdown of the business were not due to the existence of any direct physical loss or damage to property in the immediate vicinity of the insured premises and did not prohibit access to the insured premises, as required by the terms of the insurance policies. Depending on the individual policy, additional policy terms and conditions may also prohibit coverage, such as exclusions for pollutants, ordinance or law, loss of use, and acts or decisions. The company’s standard commercial property insurance policies generally did not contain a specific virus exclusion.

In addition to the inherent difficulty in predicting litigation outcomes, the COVID-19 pandemic business income coverage lawsuits present a number of uncertainties and contingencies that are not yet known, including how many policyholders will ultimately file claims, the extent to which any class may be certified, and the size and scope of any such classes. The legal theories advanced by plaintiffs vary by case as do the state laws that govern the policy interpretation. Most of these lawsuits have been dismissed, both by courts and by plaintiffs, but some have been appealed and a few others remain pending in trial courts. Appellate decisions issued to date generally have been favorable for the insurance industry, and the company has received numerous favorable rulings on appeal with no adverse appellate rulings to date. Some cases remain to be decided and in some jurisdictions, cases have been stayed pending appellate decisions in their state or federal circuit. Accordingly, little discovery has occurred on pending cases. In addition, business income calculations depend upon a wide range of factors that are particular to the circumstances of each individual policyholder and, here, virtually none of the plaintiffs have submitted proofs of loss or otherwise quantified or factually supported any allegedly covered loss. Moreover, the company’s experience shows that demands for damages often bear little relation to a reasonable estimate of potential loss. Accordingly, management cannot now reasonably estimate the possible loss or range of loss, if any. Nonetheless, given the number of claims and potential claims, the indeterminate amounts sought, and the inherent unpredictability of litigation, it is possible that adverse outcomes, if any, in the aggregate could have a material adverse effect on the company’s consolidated financial position, results of operations and cash flows.

The company and its subsidiaries also are occasionally involved in other legal and regulatory proceedings, some of which assert claims for substantial amounts. These actions include, among others, putative class actions seeking certification of state or national classes. Such proceedings have alleged, for example, improper depreciation of labor costs in repair estimates. The company’s insurance subsidiaries also are occasionally parties to individual actions in which extra-contractual damages, punitive damages or penalties are sought, such as claims alleging bad faith handling of insurance claims or writing unauthorized coverage or claims alleging discrimination by former or current associates.

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On a quarterly basis, we review these outstanding matters. Under current accounting guidance, we establish accruals when it is probable that a covered loss has been incurred and we can reasonably estimate its potential exposure. The company accounts for such probable and estimable losses, if any, through the establishment of legal expense reserves. Based on our quarterly review, we believe that our accruals for probable and estimable losses are reasonable and that the amounts accrued do not have a material effect on our consolidated financial position, results of operations and cash flows. However, if any one or more of these matters results in a judgment against us or settlement for an amount that is significantly greater than the amount accrued, the resulting liability could have a material effect on the company’s consolidated financial position, results of operations and cash flows. Based on our most recent review, our estimate for any other matters for which the risk of loss is not probable, but more than remote, is immaterial.

NOTE 13 – Segment Information

We operate primarily in two industries, property casualty insurance and life insurance. Our CODM regularly reviews our reporting segments to make decisions about allocating resources and assessing performance. Our reporting segments are:

  • Commercial lines insurance

  • Personal lines insurance

  • Excess and surplus lines insurance

  • Life insurance

  • Investments

We report as Other the noninvestment operations of the parent company and its noninsurer subsidiary, CFC Investment Company. We also report as Other the underwriting results of Cincinnati Re and Cincinnati Global. See our 2023 Annual Report on Form 10-K, Item 8, Note 18, Segment Information, Page 180, for a description of revenue, income or loss before income taxes and identifiable assets for each of the five segments.

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Segment information is summarized in the following table:

(Dollars in millions)Three months ended June 30,Six months ended June 30,
2024202320242023
Revenues:
Commercial lines insurance
Commercial casualty$372$373$737$750
Commercial property348312684611
Commercial auto228214448428
Workers' compensation5972120146
Other commercial10095200187
Commercial lines insurance premiums1,1071,0662,1892,122
Fee revenues1122
Total commercial lines insurance1,1081,0672,1912,124
Personal lines insurance
Personal auto224173432339
Homeowner326251629484
Other personal8169158134
Personal lines insurance premiums6314931,219957
Fee revenues1122
Total personal lines insurance6324941,221959
Excess and surplus lines insurance151132290259
Fee revenues1121
Total excess and surplus lines insurance152133292260
Life insurance premiums8180160157
Fee revenues2335
Total life insurance8383163162
Investments
Investment income, net of expenses242220487430
Investment gains and losses, net137434749540
Total investment revenue3796541,236970
Other
Premiums186172369366
Other4275
Total other revenues190174376371
Total revenues$2,544$2,605$5,479$4,846
Income (loss) before income taxes:
Insurance underwriting results
Commercial lines insurance$10$33$49$31
Personal lines insurance(42)(36)(5)(93)
Excess and surplus lines insurance8112024
Life insurance22133221
Investments3486241,174910
Other40216941
Total income before income taxes$386$666$1,339$934
Identifiable assets:June 30, 2024December 31, 2023
Property casualty insurance$5,864$5,294
Life insurance1,6001,562
Investments26,28524,999
Other1,053914
Total$34,802$32,769

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