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,
	2026		2025
Assets
Investments
Fixed maturities, at fair value (amortized cost: 2026—$19,280; 2025—$18,304)	$	18,954	$	18,123
Equity securities, at fair value (cost: 2026—$4,287; 2025—$4,155)	13,194		12,694
Short-term investments, at fair value (amortized cost: 2026—$143; 2025—$148)	142		148
Other invested assets	863		818
Total investments	33,153		31,783
Cash and cash equivalents	1,750		1,431

Investment income receivable	252		235
Finance receivable	143		146
Premiums receivable	3,546		3,142
Reinsurance recoverable	633		655
Prepaid reinsurance premiums	124		71
Deferred policy acquisition costs	1,442		1,344
Land, building and equipment, net, for company use (accumulated depreciation: 2026—$376; 2025—$367)	211		219
Other assets	981		995
Separate accounts	996		981
Total assets	$	43,231	$	41,002

Liabilities
Insurance reserves
Loss and loss expense reserves	$	12,479	$	11,507
Life policy and investment contract reserves	2,986		2,992
Unearned premiums	5,724		5,254
Other liabilities	1,638		1,638
Deferred income tax	1,861		1,833
Note payable	17		25
Long-term debt and lease obligations	859		861
Separate accounts	996		981
Total liabilities	26,560		25,091

Commitments and contingent liabilities (Note 12)

Shareholders' Equity
Common stock, par value—$2 per share; (authorized: 2026 and 2025—500 million shares; issued: 2026 and 2025—198.3 million shares)	397		397
Paid-in capital	1,582		1,561
Retained earnings	17,958		16,719
Accumulated other comprehensive loss	(135)		(34)
Treasury stock at cost (2026—44.9 million shares and 2025—42.9 million shares)	(3,131)		(2,732)
Total shareholders' equity	16,671		15,911
Total liabilities and shareholders' equity	$	43,231	$	41,002

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

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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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,
	2026		2025		2026		2025
Revenues
Earned premiums	$	2,635	$	2,480	$	5,239	$	4,824
Investment income, net of expenses	319		285		637		565
Investment gains and losses, net	1,308		473		1,238		406
Fee revenues	5		5		10		10
Other revenues	7		5		13		9
Total revenues	4,274		3,248		7,137		5,814
Benefits and Expenses
Insurance losses and contract holders' benefits	1,887		1,660		3,638		3,628
Underwriting, acquisition and insurance expenses	786		709		1,550		1,411
Interest expense	14		14		27		27
Other operating expenses	11		10		20		21
Total benefits and expenses	2,698		2,393		5,235		5,087
Income Before Income Taxes	1,576		855		1,902		727
Provision for Income Taxes
Current	182		81		316		39
Deferred	139		89		57		93
Total provision for income taxes	321		170		373		132
Net Income	$	1,255	$	685	$	1,529	$	595
Per Common Share
Net income — basic	$	8.14	$	4.38	$	9.88	$	3.81
Net income — diluted	8.05		4.34		9.78		3.77

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

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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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,
	2026		2025		2026		2025
Net Income	$	1,255	$	685	$	1,529	$	595
Other Comprehensive Income (loss)
Change in unrealized gains and losses on investments, net of tax (benefit) of $16, $6, $(30) and $20, respectively	58		22		(116)		75
Amortization of pension actuarial gain and prior service cost, net of tax (benefit) of $0, $0, $0 and $0, respectively	(1)		(1)		(2)		(2)
Change in life policy reserves, reinsurance recoverable and other, net of tax (benefit) of $(3), $0, $3 and $(3), respectively	(7)		1		17		(13)
Other comprehensive income (loss)	50		22		(101)		60
Comprehensive Income	$	1,305	$	707	$	1,428	$	655

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

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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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,
	2026		2025		2026		2025
Common Stock
Beginning of period	$	397	$	397	$	397	$	397
Share-based awards	—		—		—		—
End of period	397		397		397		397

Paid-In Capital
Beginning of period	1,561		1,511		1,561		1,502
Share-based awards	7		4		(10)		(3)
Share-based compensation	12		10		27		25
Other	2		3		4		4
End of period	1,582		1,528		1,582		1,528

Retained Earnings
Beginning of period	16,848		14,644		16,719		14,869


Net income	1,255		685		1,529		595
Dividends declared	(145)		(136)		(290)		(271)
End of period	17,958		15,193		17,958		15,193

Accumulated Other Comprehensive Loss
Beginning of period	(185)		(271)		(34)		(309)


Other comprehensive income (loss)	50		22		(101)		60
End of period	(135)		(249)		(135)		(249)

Treasury Stock
Beginning of period	(2,907)		(2,563)		(2,732)		(2,524)
Share-based awards	6		4		16		10
Shares acquired - share repurchase authorization	(215)		—		(394)		(42)
Shares acquired - share-based compensation plans	(13)		(10)		(19)		(13)
Other	(2)		1		(2)		1
End of period	(3,131)		(2,568)		(3,131)		(2,568)

Total Shareholders' Equity	$	16,671	$	14,301	$	16,671	$	14,301

(In millions, except per common share)
Common Stock - Shares Outstanding
Beginning of period	154.6		156.3		155.4		156.4
Share-based awards	0.2		0.1		0.5		0.3
Shares acquired - share repurchase authorization	(1.3)		—		(2.4)		(0.3)
Shares acquired - share-based compensation plans	(0.1)		(0.1)		(0.1)		(0.1)

End of period	153.4		156.3		153.4		156.3

Dividends declared per common share	$	0.94	$	0.87	$	1.88	$	1.74

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

Cincinnati Financial Corporation Second-Quarter 2026 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,
	2026		2025
Cash Flows From Operating Activities
Net income	$	1,529	$	595
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, amortization and other	82		93
Investment gains and losses, net	(1,231)		(392)

Interest credited to contract holders	21		22
Deferred income tax expense	57		93
Changes in:

Premiums and reinsurance receivable	(435)		(737)
Deferred policy acquisition costs	(98)		(125)
Other assets	(20)		(65)
Loss and loss expense reserves	972		1,069
Life policy and investment contract reserves	40		8
Unearned premiums	470		631
Other liabilities	(62)		(54)
Current income tax receivable/payable	31		(87)
Net cash provided by operating activities	1,356		1,051
Cash Flows From Investing Activities
Sale, call or maturity of fixed maturities	1,644		1,348

Sale of equity securities	1,195		34
Purchase of fixed maturities	(2,584)		(2,060)
Purchase of equity securities	(463)		(95)

Change in short-term investments, net	9		201
Changes in finance receivables	1		(3)

Investment in building and equipment	(4)		(7)
Change in other invested assets, net	(48)		(32)
Net cash used in investing activities	(250)		(614)
Cash Flows From Financing Activities
Payment of cash dividends to shareholders	(276)		(258)
Shares acquired - share repurchase authorization	(395)		(42)
Changes in note payable	(8)		—
Proceeds from stock options exercised	10		6
Contract holders' funds deposited	33		31
Contract holders' funds withdrawn	(76)		(80)
Other	(75)		(82)
Net cash used in financing activities	(787)		(425)
Net change in cash and cash equivalents	319		12
Cash and cash equivalents at beginning of year	1,431		983
Cash and cash equivalents at end of period	$	1,750	$	995
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	26	$	27
Income taxes paid	249		97
Noncash Activities

Equipment acquired under finance lease obligations	$	7	$	12
Share-based compensation	48		26
Other assets and other liabilities	66		254

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

Cincinnati Financial Corporation Second-Quarter 2026 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, 2026, 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 2025 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 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. ASU 2024-03 requires increased quantitative disclosure of certain categories of expenses contained within relevant expense captions. The effective date of ASU 2024-03 is for annual periods beginning after December 15, 2026, and interim reporting periods within annual periods beginning after December 15, 2027. The ASU should be applied prospectively with retrospective application and early adoption 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 and interim financial statements.

ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software

In September 2025, the FASB issued ASU 2025-06, Intangibles – Goodwill and Other – Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software. ASU 2025-06 modernizes the accounting for internal-use software costs by eliminating references to prescriptive and sequential software development stages and updating the cost capitalization criteria. The effective date of ASU 2025-06 is for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods, with early adoption 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.

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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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 and short-term investments:


(Dollars in millions)	Amortized cost			Gross unrealized					Fair value
At June 30, 2026			gains			losses
Fixed-maturity:
Corporate	$	10,592		$	105		$	241	$	10,456
States, municipalities and political subdivisions	5,023			41			182		4,882
Government-sponsored enterprises	2,512			—			41		2,471
Asset-backed	812			6			10		808
United States government	321			—			4		317
Foreign government	20			—			—		20

Total fixed-maturity	19,280			152			478		18,954




Short-term	143			—			1		142
Total fixed-maturity and short-term investments	$	19,423		$	152		$	479	$	19,096
At December 31, 2025
Fixed-maturity:
Corporate	$	9,750		$	164		$	203	$	9,711
States, municipalities and political subdivisions	5,065			35			181		4,919
Government-sponsored enterprises	2,360			3			4		2,359
Asset-backed	793			12			8		797
United States government	312			2			1		313
Foreign government	24			—			—		24

Total fixed-maturity	18,304			216			397		18,123
Short-term	148			—			—		148




Total fixed-maturity and short-term investments	$	18,452		$	216		$	397	$	18,271

The increase in net unrealized investment losses in our fixed-maturity portfolio at June 30, 2026, is primarily due to an increase in U.S. Treasury yields partially offset by a slight tightening of corporate credit spreads. Our asset-backed securities had an average rating of Aa2/AA at both June 30, 2026 and December 31, 2025.

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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


(Dollars in millions)	Less than 12 months				12 months or more				Total
At June 30, 2026	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses
Fixed-maturity:
Corporate	$	3,194	$	42	$	2,580	$	199	$	5,774	$	241
States, municipalities and political subdivisions	316		2		2,063		180		2,379		182
Government-sponsored enterprises	2,152		38		193		3		2,345		41
Asset-backed	202		3		184		7		386		10
United States government	276		3		20		1		296		4
Foreign government	14		—		—		—		14		—
Total fixed-maturity	6,154		88		5,040		390		11,194		478
Short-term	142		1		—		—		142		1





Total fixed-maturity and short-term investments	$	6,296	$	89	$	5,040	$	390	$	11,336	$	479
At December 31, 2025
Fixed-maturity:
Corporate	$	849	$	15	$	2,926	$	188	$	3,775	$	203
States, municipalities and political subdivisions	204		2		2,346		179		2,550		181
Government-sponsored enterprises	983		3		195		1		1,178		4
Asset-backed	101		2		184		6		285		8
United States government	69		—		20		1		89		1

Total fixed-maturity	$	2,206	$	22	$	5,671	$	375	$	7,877	$	397

Contractual maturity dates for our fixed-maturity and short-term investments were:


(Dollars in millions)	Amortized cost		Fair value		% of fair value
At June 30, 2026
Maturity dates:
Due in one year or less	$	857	$	852	4.4	%
Due after one year through five years	3,308		3,299		17.3
Due after five years through ten years	5,156		5,132		26.9
Due after ten years	10,102		9,813		51.4
Total	$	19,423	$	19,096	100.0	%

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

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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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,
	2026		2025		2026		2025
Investment income:
Interest	$	244	$	214	$	479	$	424
Dividends	72		70		148		137
Other	8		5		20		12
Total	324		289		647		573
Less investment expenses	5		4		10		8
Total	$	319	$	285	$	637	$	565

Investment gains and losses, net:
Equity securities:
Investment gains and losses on securities sold, net	$	183	$	(1)	$	223	$	(3)
Unrealized gains and losses on securities still held, net	1,117		481		1,006		411
Subtotal	1,300		480		1,229		408
Fixed-maturity securities:
Gross realized gains	7		1		9		1
Gross realized losses	(1)		—		(2)		—
Change in allowance for credit losses, net	(1)		(13)		(2)		(15)

Subtotal	5		(12)		5		(14)

Other	3		5		4		12

Total	$	1,308	$	473	$	1,238	$	406

The fair value of our equity portfolio was $13.194 billion and $12.694 billion at June 30, 2026, and December 31, 2025, respectively. Apple Inc. (Nasdaq:AAPL), an equity holding, was our largest single investment holding with fair values of $1.004 billion and $958 million, which was 7.8% and 7.7% of our publicly traded common equities portfolio and 3.1% and 3.1% of the total investment portfolio at June 30, 2026, and December 31, 2025.

The allowance for credit losses on fixed-maturity securities was $55 million and $54 million at June 30, 2026, and December 31, 2025, respectively. Reductions in the allowance for credit losses for securities sold were immaterial for the three months ended June 30, 2026. Reductions in the allowance for credit losses for securities sold were $1 million for the six months ended June 30, 2026. Reductions in the allowance for credit losses for securities sold were $1 million for both the three and six months ended June 30, 2025.

There were 2,880 and 2,597 fixed-maturity investments in a total unrealized loss position of $479 million and $397 million at June 30, 2026, and December 31, 2025, respectively. Of those totals, 14 and 13 fixed-maturity securities had fair values below 70% of amortized cost at June 30, 2026, and December 31, 2025, respectively.

Cincinnati Financial Corporation Second-Quarter 2026 10-Q

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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, 2025, and ultimately management determines fair value. See our 2025 Annual Report on Form 10-K, Item 8, Note 3, Fair Value Measurements, Page 134, 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, 2026, and December 31, 2025. We do not have any liabilities carried at fair value.


(Dollars in millions)	Level 1		Level 2		Level 3		Total
At June 30, 2026
Fixed maturities, available for sale:
Corporate	$	—	$	10,456	$	—	$	10,456
States, municipalities and political subdivisions	—		4,882		—		4,882
Government-sponsored enterprises	—		2,471		—		2,471
Asset-backed	—		808		—		808
United States government	317		—		—		317
Foreign government	—		20		—		20


Subtotal	317		18,637		—		18,954
Common equities	12,883		—		—		12,883
Nonredeemable preferred equities	—		311		—		311
Separate accounts taxable fixed maturities	100		850		—		950
Short-term investments	142		—		—		142
Top Hat savings plan mutual funds and common equity (included in Other assets)	112		—		—		112
Total	$	13,554	$	19,798	$	—	$	33,352

At December 31, 2025
Fixed maturities, available for sale:
Corporate	$	—	$	9,711	$	—	$	9,711
States, municipalities and political subdivisions	—		4,919		—		4,919
Government-sponsored enterprises	—		2,359		—		2,359
Asset-backed	—		797		—		797
United States government	313		—		—		313
Foreign government	—		24		—		24

Subtotal	313		17,810		—		18,123
Common equities	12,373		—		—		12,373
Nonredeemable preferred equities	—		321		—		321
Separate accounts taxable fixed maturities	35		872		—		907
Short-term investments	148		—		—		148
Top Hat savings plan mutual funds and common equity (included in Other assets)	102		—		—		102
Total	$	12,971	$	19,003	$	—	$	31,974

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We also held Level 1 cash and cash equivalents of $1.750 billion and $1.431 billion at June 30, 2026, and December 31, 2025, respectively.

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 value				Principal amount
Interest rate	Year of issue		June 30,		December 31,		June 30,		December 31,
		2026	2025		2026		2025
6.900%	1998	Senior debentures, due 2028	$	27	$	27	$	28	$	28
6.920%	2005	Senior debentures, due 2028	391		391		391		391
6.125%	2004	Senior notes, due 2034	373		372		374		374
Total			$	791	$	790	$	793	$	793

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


(Dollars in millions)	Level 1		Level 2		Level 3		Total
At June 30, 2026
Note payable	$	—	$	17	$	—	$	17
6.900% senior debentures, due 2028	—		29		—		29
6.920% senior debentures, due 2028	—		408		—		408
6.125% senior notes, due 2034	—		393		—		393
Total	$	—	$	847	$	—	$	847

At December 31, 2025
Note payable	$	—	$	25	$	—	$	25
6.900% senior debentures, due 2028	—		29		—		29
6.920% senior debentures, due 2028	—		416		—		416
6.125% senior notes, due 2034	—		404		—		404
Total	$	—	$	874	$	—	$	874

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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 1		Level 2		Level 3		Total
At June 30, 2026
Life policy loans	$	—	$	—	$	43	$	43

Deferred annuities	$	—	$	—	$	519	$	519
Structured settlements	—		117		—		117
Total	$	—	$	117	$	519	$	636

At December 31, 2025
Life policy loans	$	—	$	—	$	43	$	43

Deferred annuities	$	—	$	—	$	530	$	530
Structured settlements	—		123		—		123
Total	$	—	$	123	$	530	$	653

Outstanding principal and interest for these life policy loans totaled $39 million and $38 million at June 30, 2026, and December 31, 2025, respectively.

Recorded reserves for the deferred annuities were $540 million and $554 million at June 30, 2026, and December 31, 2025, respectively. Recorded reserves for the structured settlements were $107 million and $111 million at June 30, 2026, and December 31, 2025, 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,
	2026		2025		2026		2025
Gross loss and loss expense reserves, beginning of period	$	11,884	$	10,707	$	11,450	$	9,937
Less reinsurance recoverable	406		551		438		269
Net loss and loss expense reserves, beginning of period	11,478		10,156		11,012		9,668





Net incurred loss and loss expenses related to:
Current accident year	1,850		1,650		3,598		3,628
Prior accident years	(42)		(63)		(123)		(154)
Total incurred	1,808		1,587		3,475		3,474
Net paid loss and loss expenses related to:
Current accident year	612		591		846		1,184
Prior accident years	681		655		1,648		1,461
Total paid	1,293		1,246		2,494		2,645
Net loss and loss expense reserves, end of period	11,993		10,497		11,993		10,497
Plus reinsurance recoverable	413		504		413		504
Gross loss and loss expense reserves, end of period	$	12,406	$	11,001	$	12,406	$	11,001

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 $73 million and $71 million at June 30, 2026, and 2025, respectively, for certain life and health loss and loss expense reserves.

We experienced $42 million of favorable development on prior accident years, including $17 million of favorable development in commercial lines, $11 million of favorable development in personal lines and $6 million of favorable development in excess and surplus lines for the three months ended June 30, 2026. Within commercial lines, we recognized favorable reserve development of $19 million for the commercial property line and $15 million for the workers' compensation 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 $14 million for the commercial casualty line.

We experienced $123 million of favorable development on prior accident years, including $70 million of favorable development in commercial lines, $18 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, 2026. Within commercial lines, we recognized favorable reserve development of $50 million for the commercial property line and $24 million for the workers' compensation 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 $11 million for the commercial casualty line. Within personal lines, we recognized favorable reserve development of $19 million for the homeowner line.

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We experienced $63 million of favorable development on prior accident years, including $42 million of favorable development in commercial lines, $19 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, 2025. Within commercial lines, we recognized favorable reserve development of $40 million for the commercial property line and $17 million for the workers' compensation 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 $18 million for the commercial auto line. Within personal lines, we recognized favorable reserve development of $25 million for the homeowner line.

We experienced $154 million of favorable development on prior accident years, including $85 million of favorable development in commercial lines, $38 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, 2025. Within commercial lines, we recognized favorable reserve development of $75 million for the commercial property line and $28 million for the workers' compensation 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 $24 million for the commercial auto line. Within personal lines, we recognized favorable reserve development of $44 million for the homeowner 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, typically in the second quarter, 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. 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, 2026		December 31, 2025
Life policy reserves:
Term	$	1,116	$	1,103
Whole life	425		426
Other	102		100
Subtotal	1,643		1,629
Investment contract reserves:
Deferred annuities	540		554
Universal life	586		589
Structured settlements	107		111
Other	110		109
Subtotal	1,343		1,363
Total life policy and investment contract reserves	$	2,986	$	2,992

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

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(Dollars in millions)	Three months ended June 30,
	2026				2025
	Term		Whole life		Term		Whole life
Present value of expected net premiums:
Balance, beginning of period	$	1,688	$	221	$	1,659	$	220
Beginning balance at original discount rate	1,749		227		1,719		227
Effect of changes in cash flow assumptions	21		(5)		(4)		—
Effect of actual variances from expected experience	(4)		—		5		(1)
Adjusted beginning of period balance	1,766		222		1,720		226
Issuances	40		4		41		4
Interest accrual	20		3		19		2
Net premiums collected	(50)		(7)		(49)		(6)
Ending balance at original discount rate	1,776		222		1,731		226
Effect of changes in discount rate assumptions	(57)		(6)		(53)		(6)
Balance, end of period	1,719		216		1,678		220

Present value of expected future policy benefits:
Balance, beginning of period	2,760		640		2,703		631
Beginning balance at original discount rate	2,877		666		2,812		648
Effect of changes in cash flow assumptions	36		(8)		(12)		—
Effect of actual variances from expected experience	(9)		—		8		(1)
Adjusted beginning of period balance	2,904		658		2,808		647
Issuances	39		4		40		4
Interest accrual	34		9		32		8
Benefits paid	(46)		(9)		(59)		(8)
Ending balance at original discount rate	2,931		662		2,821		651
Effect of changes in discount rate assumptions	(108)		(21)		(101)		(17)
Balance, end of period	2,823		641		2,720		634

Net liability for future policy benefits:
Present value of expected future policy benefits less expected net premiums	1,104		425		1,042		414
Impact of flooring at cohort level	12		—		19		—
Net life policy reserves	1,116		425		1,061		414
Less reinsurance recoverable at original discount rate	(70)		(24)		(68)		(25)
Less effect of discount rate assumption changes on reinsurance recoverable	(4)		(3)		(7)		(3)
Net life policy reserves, after reinsurance recoverable	$	1,042	$	398	$	986	$	386

Weighted-average duration of the net life policy reserves in years	11		14		11		15

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(Dollars in millions)	Six months ended June 30,
	2026				2025
	Term		Whole life		Term		Whole life
Present value of expected net premiums:
Balance, beginning of period	$	1,709	$	225	$	1,638	$	218
Beginning balance at original discount rate	1,743		228		1,719		228
Effect of changes in cash flow assumptions	21		(5)		(4)		—
Effect of actual variances from expected experience	(10)		—		(3)		(1)
Adjusted beginning of period balance	1,754		223		1,712		227
Issuances	79		8		76		7
Interest accrual	39		5		38		5
Net premiums collected	(96)		(14)		(95)		(13)
Ending balance at original discount rate	1,776		222		1,731		226
Effect of changes in discount rate assumptions	(57)		(6)		(53)		(6)
Balance, end of period	1,719		216		1,678		220

Present value of expected future policy benefits:
Balance, beginning of period	2,794		650		2,668		623
Beginning balance at original discount rate	2,863		662		2,812		646
Effect of changes in cash flow assumptions	36		(8)		(12)		—
Effect of actual variances from expected experience	(16)		—		(6)		(1)
Adjusted beginning of period balance	2,883		654		2,794		645
Issuances	78		8		76		7
Interest accrual	66		17		64		17
Benefits paid	(96)		(17)		(113)		(18)
Ending balance at original discount rate	2,931		662		2,821		651
Effect of changes in discount rate assumptions	(108)		(21)		(101)		(17)
Balance, end of period	2,823		641		2,720		634

Net liability for future policy benefits:
Present value of expected future policy benefits less expected net premiums	1,104		425		1,042		414
Impact of flooring at cohort level	12		—		19		—
Net life policy reserves	1,116		425		1,061		414
Less reinsurance recoverable at original discount rate	(70)		(24)		(68)		(25)
Less effect of discount rate assumption changes on reinsurance recoverable	(4)		(3)		(7)		(3)
Net life policy reserves, after reinsurance recoverable	$	1,042	$	398	$	986	$	386

Weighted-average duration of the net life policy reserves in years	11		14		11		15

The total impact of flooring at cohort level in the above tables includes the effect of discount rate assumption changes of $1 million and $2 million at June 30, 2026 and 2025, respectively.

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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,
	2026				2025
	Undiscounted		Discounted		Undiscounted		Discounted
Term
Expected future benefit payments	$	5,183	$	2,823	$	4,947	$	2,720
Expected future gross premiums	4,782		2,782		4,632		2,697
Whole life
Expected future benefit payments	$	1,765	$	641	$	1,709	$	634
Expected future gross premiums	710		423		688		415

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,
	2026		2025		2026		2025
Gross premiums
Term	$	80	$	77	$	157	$	151
Whole life	14		14		28		27

Total	$	94	$	91	$	185	$	178
Interest accretion
Term	$	14	$	13	$	27	$	26
Whole life	6		6		12		12

Total	$	20	$	19	$	39	$	38

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, 2026, and 2025.

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


	At June 30,
	2026		2025
Term
Interest accretion rate	5.30	%	5.22	%
Current discount rate	5.32		4.93
Whole life
Interest accretion rate	5.85	%	5.86	%
Current discount rate	5.78		5.68

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,
	2026						2025						2026						2025
	Deferred annuity			Universal life			Deferred annuity			Universal life			Deferred annuity			Universal life			Deferred annuity			Universal life
Balance, beginning of period	$	546		$	449		$	582		$	457		$	554		$	451		$	595		$	456
Premiums received	8			9			8			9			14			18			12			19
Policy charges	—			(10)			—			(10)			—			(20)			—			(20)
Surrenders and withdrawals	(15)			(4)			(18)			(3)			(30)			(9)			(35)			(6)
Benefit payments	(4)			(2)			(3)			(4)			(8)			(3)			(8)			(5)
Interest credited	5			5			6			5			10			10			11			10

Balance, end of period	$	540		$	447		$	575		$	454		$	540		$	447		$	575		$	454

Weighted average crediting rate	3.79		%	4.42		%	3.71		%	4.43		%	3.79		%	4.42		%	3.71		%	4.43		%
Net amount at risk	$	—		$	3,610		$	—		$	3,746		$	—		$	3,610		$	—		$	3,746
Cash surrender value	533			422			568			426			533			422			568			426

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 minimum		1 to 50 basis points above		51-150 basis points above		Greater than 150 basis points		Total
At June 30, 2026
Deferred annuity
1.00-3.00%	$	235	$	2	$	18	$	242	$	497
3.01-4.00%	43		—		—		—		43

Total	$	278	$	2	$	18	$	242	$	540
Universal life
1.00-3.00%	$	—	$	53	$	57	$	18	$	128
3.01-4.00%	51		—		5		—		56
Greater than 4.00%	263		—		—		—		263
Total	$	314	$	53	$	62	$	18	$	447

At June 30, 2025
Deferred annuity
1.00-3.00%	$	9	$	269	$	14	$	237	$	529
3.01-4.00%	46		—		—		—		46

Total	$	55	$	269	$	14	$	237	$	575
Universal life
1.00-3.00%	$	—	$	55	$	56	$	15	$	126
3.01-4.00%	51		—		4		—		55
Greater than 4.00%	273		—		—		—		273
Total	$	324	$	55	$	60	$	15	$	454

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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,
	2026		2025		2026		2025
Balance, beginning of period	$	141	$	130	$	138	$	130

Balance, beginning of period before shadow reserve adjustments	142		131		138		131
Effect of changes in cash flow assumptions	(5)		—		(5)		—
Effect of actual variances from expected experience	—		—		1		2
Adjusted beginning of period balance	137		131		134		133
Interest accrual	2		1		3		2
Excess death benefits	(2)		(2)		(4)		(9)
Attributed assessments	3		3		6		6

Effect of changes in interest rate assumptions	—		—		1		1
Balance, end of period before shadow reserve adjustments	140		133		140		133
Shadow reserve adjustments	(1)		(1)		(1)		(1)
Balance, end of period	139		132		139		132
Less reinsurance recoverable, end of period	7		6		7		6

Net other additional liability, after reinsurance recoverable	$	146	$	138	$	146	$	138

Weighted-average duration of the other additional liability in years	25		26		25		26

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


(Dollars in millions)	Three months ended June 30,				Six months ended June 30,
	2026		2025		2026		2025
Balance, beginning of period	$	988	$	959	$	981	$	952
Interest credited before policy charges	13		11		24		22

Benefit payments	(6)		—		(7)		(8)




Other	1		21		(2)		25
Balance, end of period	$	996	$	991	$	996	$	991

Cash surrender value	$	990	$	959	$	990	$	959

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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,
	2026		2025		2026		2025
Property casualty:
Deferred policy acquisition costs asset, beginning of period	$	1,011	$	937	$	974	$	886
Capitalized deferred policy acquisition costs	534		513		1,046		998
Amortized deferred policy acquisition costs	(480)		(445)		(955)		(879)
Deferred policy acquisition costs asset, end of period	$	1,065	$	1,005	$	1,065	$	1,005

Life:
Deferred policy acquisition costs asset, beginning of period	$	373	$	360	$	370	$	356
Capitalized deferred policy acquisition costs	12		10		23		22
Amortized deferred policy acquisition costs	(8)		(8)		(16)		(16)

Deferred policy acquisition costs asset, end of period	$	377	$	362	$	377	$	362

Consolidated:
Deferred policy acquisition costs asset, beginning of period	$	1,384	$	1,297	$	1,344	$	1,242
Capitalized deferred policy acquisition costs	546		523		1,069		1,020
Amortized deferred policy acquisition costs	(488)		(453)		(971)		(895)

Deferred policy acquisition costs asset, end of period	$	1,442	$	1,367	$	1,442	$	1,367

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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, 2026	Term		Whole life		Deferred annuity		Universal life		Total
Balance, beginning of period	$	260	$	56	$	8	$	49	$	373
Capitalized deferred policy acquisition costs	10		1		1		—		12
Amortized deferred policy acquisition costs	(6)		(1)		(1)		—		(8)
Balance, end of period	$	264	$	56	$	8	$	49	$	377

Three months ended June 30, 2025
Balance, beginning of period	$	248	$	53	$	8	$	51	$	360
Capitalized deferred policy acquisition costs	9		1		—		—		10
Amortized deferred policy acquisition costs	(6)		(1)		(1)		—		(8)
Balance, end of period	$	251	$	53	$	7	$	51	$	362


(Dollars in millions)
Six months ended June 30, 2026	Term		Whole life		Deferred annuity		Universal life		Total
Balance, beginning of period	$	257	$	55	$	8	$	50	$	370
Capitalized deferred policy acquisition costs	19		3		1		—		23
Amortized deferred policy acquisition costs	(12)		(2)		(1)		(1)		(16)
Balance, end of period	$	264	$	56	$	8	$	49	$	377

Six months ended June 30, 2025
Balance, beginning of period	$	245	$	52	$	8	$	51	$	356
Capitalized deferred policy acquisition costs	18		3		—		1		22
Amortized deferred policy acquisition costs	(12)		(2)		(1)		(1)		(16)
Balance, end of period	$	251	$	53	$	7	$	51	$	362

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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,
	2026						2025
	Before tax		Income tax		Net		Before tax		Income tax		Net
Investments:
AOCI, beginning of period	$	(401)	$	(86)	$	(315)	$	(486)	$	(105)	$	(381)


OCI before investment gains and losses, net, recognized in net income	79		17		62		16		3		13
Investment gains and losses, net, recognized in net income	(5)		(1)		(4)		12		3		9
OCI	74		16		58		28		6		22
AOCI, end of period	$	(327)	$	(70)	$	(257)	$	(458)	$	(99)	$	(359)

Pension obligations:
AOCI, beginning of period	$	84	$	19	$	65	$	74	$	17	$	57
OCI excluding amortization recognized in net income	—		—		—		—		—		—
Amortization recognized in net income	(1)		—		(1)		(1)		—		(1)
OCI	(1)		—		(1)		(1)		—		(1)
AOCI, end of period	$	83	$	19	$	64	$	73	$	17	$	56

Life policy reserves, reinsurance recoverable and other:
AOCI, beginning of period	$	82	$	17	$	65	$	68	$	15	$	53


OCI before investment gains and losses, net, recognized in net income	(10)		(3)		(7)		1		—		1
Investment gains and losses, net, recognized in net income	—		—		—		—		—		—
OCI	(10)		(3)		(7)		1		—		1
AOCI, end of period	$	72	$	14	$	58	$	69	$	15	$	54

Summary of AOCI:
AOCI, beginning of period	$	(235)	$	(50)	$	(185)	$	(344)	$	(73)	$	(271)


Investments OCI	74		16		58		28		6		22
Pension obligations OCI	(1)		—		(1)		(1)		—		(1)
Life policy reserves, reinsurance recoverable and other OCI	(10)		(3)		(7)		1		—		1
Total OCI	63		13		50		28		6		22
AOCI, end of period	$	(172)	$	(37)	$	(135)	$	(316)	$	(67)	$	(249)

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(Dollars in millions)	Six months ended June 30,
	2026						2025
	Before tax		Income tax		Net		Before tax		Income tax		Net
Investments:
AOCI, beginning of period	$	(181)	$	(40)	$	(141)	$	(553)	$	(119)	$	(434)


OCI before investment gains and losses, net, recognized in net income	(141)		(29)		(112)		81		17		64
Investment gains and losses, net, recognized in net income	(5)		(1)		(4)		14		3		11
OCI	(146)		(30)		(116)		95		20		75
AOCI, end of period	$	(327)	$	(70)	$	(257)	$	(458)	$	(99)	$	(359)

Pension obligations:
AOCI, beginning of period	$	85	$	19	$	66	$	75	$	17	$	58
OCI excluding amortization recognized in net income	—		—		—		—		—		—
Amortization recognized in net income	(2)		—		(2)		(2)		—		(2)
OCI	(2)		—		(2)		(2)		—		(2)
AOCI, end of period	$	83	$	19	$	64	$	73	$	17	$	56

Life policy reserves, reinsurance recoverable and other:
AOCI, beginning of period	$	52	$	11	$	41	$	85	$	18	$	67


OCI before investment gains and losses, net, recognized in net income	20		3		17		(16)		(3)		(13)
Investment gains and losses, net, recognized in net income	—		—		—		—		—		—
OCI	20		3		17		(16)		(3)		(13)
AOCI, end of period	$	72	$	14	$	58	$	69	$	15	$	54

Summary of AOCI:
AOCI, beginning of period	$	(44)	$	(10)	$	(34)	$	(393)	$	(84)	$	(309)


Investments OCI	(146)		(30)		(116)		95		20		75
Pension obligations OCI	(2)		—		(2)		(2)		—		(2)
Life policy reserves, reinsurance recoverable and other OCI	20		3		17		(16)		(3)		(13)
Total OCI	(128)		(27)		(101)		77		17		60
AOCI, end of period	$	(172)	$	(37)	$	(135)	$	(316)	$	(67)	$	(249)

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 treaties and catastrophe bonds 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,
	2026		2025		2026		2025
Direct written premiums	$	2,739	$	2,672	$	5,246	$	5,060
Assumed written premiums	216		196		497		499
Ceded written premiums	(130)		(135)		(250)		(331)
Net written premiums	$	2,825	$	2,733	$	5,493	$	5,228

Direct earned premiums	$	2,479	$	2,333	$	4,927	$	4,580
Assumed earned premiums	170		162		337		352
Ceded earned premiums	(101)		(98)		(197)		(271)
Earned premiums	$	2,548	$	2,397	$	5,067	$	4,661

Direct incurred loss and loss expenses	$	1,759	$	1,508	$	3,354	$	3,657
Assumed incurred loss and loss expenses	84		91		165		327
Ceded incurred loss and loss expenses	(35)		(12)		(44)		(510)
Incurred loss and loss expenses	$	1,808	$	1,587	$	3,475	$	3,474

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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 and accidental death coverage in excess of certain deductibles.

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,
	2026		2025		2026		2025
Direct earned premiums	$	107	$	104	$	212	$	203

Ceded earned premiums	(20)		(21)		(40)		(40)
Earned premiums	$	87	$	83	$	172	$	163

Direct contract holders' benefits incurred	$	96	$	104	$	195	$	198

Ceded contract holders' benefits incurred	(17)		(31)		(32)		(44)
Contract holders' benefits incurred	$	79	$	73	$	163	$	154

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 receivable was $18 million at both June 30, 2026, and December 31, 2025. The allowances for credit losses on other premiums receivable and reinsurance recoverable assets were immaterial at June 30, 2026, and December 31, 2025.

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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,
	2026				2025				2026				2025
Tax at statutory rate:	$	331	21.0	%	$	180	21.0	%	$	399	21.0	%	$	153	21.0	%
Increase (decrease) resulting from:
Nontaxable or nondeductible items
Tax-exempt income from municipal bonds	(6)		(0.4)		(6)		(0.7)		(12)		(0.6)		(11)		(1.5)
Dividend received exclusion	(6)		(0.4)		(6)		(0.7)		(12)		(0.6)		(11)		(1.5)
Other nontaxable or nondeductible items	—		—		—		—		(1)		(0.1)		2		0.3
Other	2		0.2		2		0.3		(1)		(0.1)		(1)		(0.1)
Provision for income taxes	$	321	20.4	%	$	170	19.9	%	$	373	19.6	%	$	132	18.2	%

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, 2026, and December 31, 2025.

Cincinnati Global

Cincinnati Global had no operating loss carryforwards in the United States and $26 million and $50 million in the United Kingdom at June 30, 2026, and December 31, 2025, 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,
	2026			2025			2026			2025
Numerator:
Net income—basic and diluted		$	1,255		$	685		$	1,529		$	595
Denominator:
Basic weighted-average common shares outstanding		154.1			156.3			154.7			156.4
Effect of share-based awards:
Stock options		1.1			0.9			1.1			1.0
Nonvested shares		0.5			0.6			0.5			0.4
Diluted weighted-average shares		155.7			157.8			156.3			157.8
Earnings per share:
Basic		$	8.14		$	4.38		$	9.88		$	3.81
Diluted		$	8.05		$	4.34		$	9.78		$	3.77
Number of anti-dilutive share-based awards		0.3			0.3			0.5			0.4

The source of dilution of our common shares are certain equity-based awards. See our 2025 Annual Report on Form 10-K, Item 8, Note 17, Share-Based Associate Compensation Plans, Page 169, 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, 2026 and 2025.

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,
	2026		2025		2026		2025
Service cost	$	1	$	1	$	2	$	2
Non-service (benefit) costs:
Interest cost	3		3		7		7
Expected return on plan assets	(6)		(5)		(12)		(11)
Amortization of actuarial gain and prior service cost	(1)		(1)		(2)		(2)

Total non-service benefit	(4)		(3)		(7)		(6)
Net periodic benefit	$	(3)	$	(2)	$	(5)	$	(4)

See our 2025 Annual Report on Form 10-K, Item 8, Note 13, Employee Retirement Benefits, Page 163, 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 2026 and 2025.

We made matching contributions totaling $9 million and $8 million to our 401(k) and Top Hat savings plans during the second quarter of 2026 and 2025, respectively, and contributions of $17 million and $19 million for the first half of 2026 and 2025, respectively.

We made no contributions to our qualified pension plan during the first six months of 2026.

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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 third-party claims brought against insureds and as an insurer defending against coverage claims. 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.

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. 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.

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 chief operating decision maker (CODM) is the chief executive officer who regularly reviews our reporting segments to make decisions about allocating resources and assessing performance. Our five 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 2025 Annual Report on Form 10-K, Item 8, Note 18, Segment Information, Page 172, for a description of revenue, income or loss before income taxes, including its components, 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,
	2026		2025		2026		2025

Commercial lines insurance





Commercial lines insurance premiums	$	1,251	$	1,212	$	2,492	$	2,391
Fee revenues	1		—		2		2
Total commercial lines insurance revenues	1,252		1,212		2,494		2,393
Loss and loss expenses	910		767		1,757		1,502
Underwriting expenses	391		358		768		707
Total commercial lines income (loss) before income taxes	(49)		87		(31)		184

Personal lines insurance



Personal lines insurance premiums	880		804		1,753		1,502
Fee revenues	1		2		3		3
Total personal lines insurance revenues	881		806		1,756		1,505
Loss and loss expenses	638		598		1,245		1,444
Underwriting expenses	242		222		480		432
Total personal lines income (loss) before income taxes	1		(14)		31		(371)

Excess and surplus lines insurance
Excess and surplus lines insurance premiums	189		174		369		336
Fee revenues	1		1		2		2
Total excess and surplus lines insurance revenues	190		175		371		338
Loss and loss expenses	118		110		228		209
Underwriting expenses	53		49		103		93
Total excess and surplus lines income before income taxes	19		16		40		36

Life insurance
Life insurance premiums	87		83		172		163
Fee revenues	2		2		3		3
Total life insurance revenues	89		85		175		166
Contract holders' benefits incurred	79		73		163		154
Investment interest credited to contract holders	(33)		(31)		(65)		(63)
Underwriting expenses incurred	25		24		48		47
Total life insurance income before income taxes	18		19		29		28

Investments
Investment income, net of expenses	319		285		637		565
Investment gains and losses, net	1,308		473		1,238		406
Total investment revenue	1,627		758		1,875		971
Investment interest credited to contract holders	33		31		65		63
Total investment income before income taxes	1,594		727		1,810		908

Reconciliation to condensed consolidated income before income taxes
Total segment revenues	4,039		3,036		6,671		5,373
Other earned premiums	228		207		453		432
Other revenues	7		5		13		9
Total revenues	4,274		3,248		7,137		5,814
Total segment benefits and expenses	2,456		2,201		4,792		4,588
Other loss and loss expenses	142		112		245		319
Other underwriting expenses	75		56		151		132
Other benefits and expenses	25		24		47		48
Total benefits and expenses	2,698		2,393		5,235		5,087
Total income before income taxes	$	1,576	$	855	$	1,902	$	727

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Identifiable assets by segment are summarized in the following table:


(Dollars in millions)	June 30,		December 31,
	2026		2025
Identifiable assets:
Property casualty insurance	$	7,542	$	6,916
Life insurance	1,744		1,695
Investments	32,544		31,199
Other	1,401		1,192
Total	$	43,231	$	41,002

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