Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Management’s discussion and analysis of financial condition and results of operations (“MD&A”) should be read in conjunction with our Consolidated Condensed Financial Statements included under Item 1 of this Report and the Consolidated Financial Statements, Risk Factors, and MD&A included in our Annual Report on Form 10-K for the year ended December 31, 2021. This MD&A is comprised of the following sections:

			Page No.
Overview			39
Results of Operations			40
Consolidated Financial Results			40
CNA Financial			40
Boardwalk Pipelines			50
Loews Hotels & Co			53
Corporate			54
Liquidity and Capital Resources			55
Parent Company			55
Subsidiaries			55
Investments			56
Critical Accounting Estimates			60
Accounting Standards Update			60
Forward-Looking Statements			61

OVERVIEW

Loews Corporation is a holding company and has four reportable segments comprised of three individual consolidated operating subsidiaries, CNA Financial Corporation (“CNA”), Boardwalk Pipeline Partners, LP (“Boardwalk Pipelines”) and Loews Hotels Holding Corporation (“Loews Hotels & Co”); and the Corporate segment. The Corporate segment is primarily comprised of Loews Corporation, excluding its operating subsidiaries, the consolidated operations of Altium Packaging LLC (“Altium Packaging”) through March 31, 2021 and the equity method of accounting for Altium Packaging subsequent to its deconsolidation on April 1, 2021. For information regarding the deconsolidation of Altium Packaging see Note 2 of the Consolidated Financial Statements in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.

Unless the context otherwise requires, the term “Company” means Loews Corporation including its consolidated subsidiaries, the terms “Parent Company,” “we,” “our,” “us” or like terms mean Loews Corporation excluding its subsidiaries, the term “Net income (loss) attributable to Loews Corporation” means Net income (loss) attributable to Loews Corporation shareholders and the term “subsidiaries” means Loews Corporation’s consolidated subsidiaries.

We rely upon our invested cash balances and distributions from our subsidiaries to generate the funds necessary to meet our obligations and to declare and pay any dividends to our shareholders. The ability of our subsidiaries to pay dividends is subject to, among other things, the availability of sufficient earnings and funds in such subsidiaries, applicable state laws, including in the case of the insurance subsidiaries of CNA, laws and rules governing the payment of dividends by regulated insurance companies (see Note 14 of the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2021) and compliance with covenants in their respective loan agreements. Claims of creditors of our subsidiaries will generally have priority as to the assets of such subsidiaries over our claims and those of our creditors and shareholders. We are not responsible for the liabilities and obligations of our subsidiaries and there are no Parent Company guarantees.

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RESULTS OF OPERATIONS

Consolidated Financial Results

The following table summarizes net income (loss) attributable to Loews Corporation by segment and net income (loss) per share attributable to Loews Corporation for the three and nine months ended September 30, 2022 and 2021:

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions, except per share data)
CNA Financial			$	115					$	229		$	579					$	838
Boardwalk Pipelines			34						38			164						170
Loews Hotels & Co			25						13			84						(51)
Corporate			(44)						(60)			(179)						278
Net income attributable to Loews Corporation			$	130					$	220		$	648					$	1,235
Basic net income per share			$	0.54					$	0.86		$	2.65					$	4.71
Diluted net income per share			$	0.54					$	0.85		$	2.64					$	4.70

Net income attributable to Loews Corporation for the three months ended September 30, 2022 was $130 million, or $0.54 per share, compared to $220 million, or $0.85 per share in the comparable 2021 period. Net income attributable to Loews Corporation for the nine months ended September 30, 2022 was $648 million, or $2.64 per share, compared to $1.2 billion, or $4.70 per share in the comparable 2021 period.

Net income attributable to Loews Corporation in the third quarter of 2022 as compared to the comparable 2021 period included higher underwriting income and increased net investment income from fixed income securities at CNA and improved results at Loews Hotels & Co offset by losses from limited partnership and common stock investments and net investment losses from sales of fixed income securities at CNA.

The Corporate segment included a gain of $438 million (after tax) related to the sale of 47% of Altium Packaging and its deconsolidation in the nine months ended September 30, 2021. Excluding this significant transaction, the drivers of the decrease in net income attributable to Loews Corporation for the nine months ended September 30, 2022 as compared to the comparable 2021 period are consistent with the three-month discussion above.

CNA Financial

The following table summarizes the results of operations for CNA for the three and nine months ended September 30, 2022 and 2021 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report. For further discussion of Net investment income and Investment gains (losses), see the Investments section of this MD&A.

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			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Revenues:
Insurance premiums			$	2,221					$	2,059		$	6,435					$	6,056
Net investment income			422						513			1,302						1,608
Investment gains (losses)			(96)						22			(166)						117
Non-insurance warranty revenue			399						357			1,173						1,054
Other revenues			11						8			24						19
Total			2,957						2,959			8,768						8,854
Expenses:
Insurance claims and policyholders’ benefits			1,665						1,632			4,703						4,684
Amortization of deferred acquisition costs			383						368			1,101						1,084
Non-insurance warranty expense			371						330			1,092						973
Other operating expenses			346						287			1,001						874
Interest			28						28			84						85
Total			2,793						2,645			7,981						7,700
Income before income tax			164						314			787						1,154
Income tax expense			(36)						(59)			(141)						(219)
Net income			128						255			646						935
Amounts attributable to noncontrolling interests			(13)						(26)			(67)						(97)
Net income attributable to Loews Corporation			$	115					$	229		$	579					$	838

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $114 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and investment losses for the three months ended September 30, 2022 as compared with investment gains in the comparable 2021 period. Lower net investment income was driven by unfavorable limited partnership and common stock results and lower investment results were driven by net losses on fixed maturity securities. These decreases to net income were partially offset by improved underwriting results and higher net investment income from fixed income securities for the three months ended September 30, 2022 as compared with the comparable 2021 period. Catastrophe losses were $114 million ($80 million after tax and noncontrolling interests) for the three months ended September 30, 2022 as compared with $178 million ($125 million after tax and noncontrolling interests) in the comparable 2021 period. Catastrophe losses for the three months ended September 30, 2022 were driven by severe weather related events, including $87 million for Hurricane Ian. Catastrophe losses for the three months ended September 30, 2021 included $114 million for Hurricane Ida.

Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $259 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and investment losses for the nine months ended September 30, 2022 as compared with investment gains in the comparable 2021 period. Lower net investment income was driven by unfavorable limited partnership and common stock results and lower investment results were driven by the unfavorable change in fair value of non-redeemable preferred stock and net losses on fixed maturity securities. These decreases to net income were partially offset by improved underwriting results and higher net investment income from fixed income securities for the nine months ended September 30, 2022 as compared with the comparable 2021 period. Catastrophe losses were $171 million ($121 million after tax and noncontrolling interests) for the nine months ended September 30, 2022 as compared with $357 million ($251 million after tax and noncontrolling interests) in the comparable 2021 period. Catastrophe losses for the nine months ended September 30, 2022 were driven by severe weather related events, including $87 million for Hurricane Ian. Catastrophe losses for the nine months ended September 30, 2021 were driven by severe weather related events, primarily Hurricane Ida and Winter Storms Uri and Viola.

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CNA’s Property & Casualty and Other Insurance Operations

CNA’s commercial property and casualty insurance operations (“Property & Casualty Operations”) include its Specialty, Commercial and International lines of business. CNA’s Other Insurance Operations outside of Property & Casualty Operations include its long term care business that is in run-off, certain corporate expenses, including interest on CNA’s corporate debt, and the results of certain property and casualty businesses in run-off, including CNA Re, asbestos and environmental pollution (“A&EP”), a legacy portfolio of excess workers’ compensation (“EWC”) policies and certain legacy mass tort reserves. We believe the presentation of CNA as one reportable segment is appropriate in accordance with applicable accounting standards on segment reporting. However, for purposes of this discussion and analysis of the results of operations, we provide greater detail with respect to CNA’s Property & Casualty Operations and Other Insurance Operations to enhance the reader’s understanding and to provide further transparency into key drivers of CNA’s financial results.

In assessing its insurance operations, CNA utilizes the core income (loss) financial measure. Core income (loss) is calculated by excluding from net income (loss), investment gains or losses and any cumulative effects of changes in accounting guidance. In addition, core income (loss) excludes the effects of noncontrolling interests. The calculation of core income (loss) excludes investment gains or losses because investment gains or losses are generally driven by economic factors that are not necessarily reflective of CNA’s primary insurance operations. Core income (loss) is deemed to be a non-GAAP financial measure and management believes some investors may find this measure useful to evaluate CNA’s insurance operations. Please see the non-GAAP reconciliation of core income (loss) to net income (loss) that follows in this MD&A.

Property & Casualty Operations

In evaluating the results of Property & Casualty Operations, CNA utilizes the loss ratio, the loss ratio excluding catastrophes and development, the expense ratio, the dividend ratio, the combined ratio and the combined ratio excluding catastrophes and development. These ratios are calculated using GAAP financial results. The loss ratio is the percentage of net incurred claim and claim adjustment expenses to net earned premiums. The loss ratio excluding catastrophes and development excludes catastrophes losses and changes in estimates of claim and claim adjustment expense reserves, net of reinsurance, for prior years from the loss ratio. The expense ratio is the percentage of insurance underwriting and acquisition expenses, including the amortization of deferred acquisition costs, to net earned premiums. The dividend ratio is the ratio of policyholders’ dividends incurred to net earned premiums. The combined ratio is the sum of the loss, expense and dividend ratios. The combined ratio excluding catastrophes and development is the sum of the loss ratio excluding catastrophes and development, the expense ratio and the dividend ratio. In addition, renewal premium change, rate, retention and new business are also utilized in evaluating operating trends. Renewal premium change represents the estimated change in average premium on policies that renew, including rate and exposure changes. Rate represents the average change in price on policies that renew excluding exposure change. For certain products within Small Business, where quantifiable, rate includes the influence of new business as well. Exposure represents the measure of risk used in the pricing of the insurance product. Retention represents the percentage of premium dollars renewed, excluding rate and exposure changes, in comparison to the expiring premium dollars from policies available to renew. Renewal premium change, rate and retention presented for the prior period are updated to reflect subsequent activity on policies written in the period. New business represents premiums from policies written with new customers and additional policies written with existing customers. Gross written premiums, excluding third-party captives, excludes business which is ceded to third-party captives, including business related to large warranty programs.

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The following tables summarize the results of CNA’s Property & Casualty Operations for the three and nine months ended September 30, 2022 and 2021.

Three Months Ended September 30, 2022			Specialty						Commercial						International						Total
(In millions, except %)
Gross written premiums			$	1,890					$	1,187					$	288					$	3,365
Gross written premiums excluding third-party captives			958						1,184						288						2,430
Net written premiums			840						962						258						2,060
Net earned premiums			810						1,023						270						2,103
Net investment income			102						112						16						230
Core income			161						80						19						260
Other performance metrics:
Loss ratio excluding catastrophes and development			58.4		%				61.5		%				58.6		%				59.9		%
Effect of catastrophe impacts			0.2						10.0						4.1						5.5
Effect of development-related items			(1.9)																		(0.8)
Loss ratio			56.7		%				71.5		%				62.7		%				64.6		%
Expense ratio			31.7						29.9						31.7						30.8
Dividend ratio			0.3						0.5												0.4
Combined ratio			88.7		%				101.9		%				94.4		%				95.8		%
Combined ratio excluding catastrophes and development			90.4		%				91.9		%				90.3		%				91.1		%
Rate			5		%				4		%				6		%				5		%
Renewal premium change			6						8						12						8
Retention			87						84						82						85
New business			$	130					$	246					$	79					$	455

Three Months Ended September 30, 2021
Gross written premiums			$	1,953					$	1,010					$	276					$	3,239
Gross written premiums excluding third-party captives			943						1,005						276						2,224
Net written premiums			822						831						256						1,909
Net earned premiums			773						893						271						1,937
Net investment income			116						141						14						271
Core income			173						27						17						217
Other performance metrics:
Loss ratio excluding catastrophes and development			59.1		%				61.5		%				58.9		%				60.2		%
Effect of catastrophe impacts			0.4						18.6						3.4						9.2
Effect of development-related items			(1.8)						0.5						1.1						(0.3)
Loss ratio			57.7		%				80.6		%				63.4		%				69.1		%
Expense ratio			30.6						30.4						32.1						30.7
Dividend ratio			(0.1)						0.6												0.2
Combined ratio			88.2		%				111.6		%				95.5		%				100.0		%
Combined ratio excluding catastrophes and development			89.6		%				92.5		%				91.0		%				91.1		%
Rate			10		%				6		%				13		%				8		%
Renewal premium change			11						9						13						10
Retention			80						83						79						81
New business			$	147					$	204					$	54					$	405

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Nine Months Ended September 30, 2022			Specialty						Commercial						International						Total
(In millions, except %)
Gross written premiums			$	5,640					$	3,824					$	1,033					$	10,497
Gross written premiums excluding third-party captives			2,816						3,711						1,033						7,560
Net written premiums			2,443						3,097						839						6,379
Net earned premiums			2,376						2,901						803						6,080
Net investment income			305						343						44						692
Core income			485						350						63						898
Other performance metrics:
Loss ratio excluding catastrophes and development			58.6		%				61.5		%				58.6		%				60.0		%
Effect of catastrophe impacts			0.1						5.0						2.7						2.8
Effect of development-related items			(1.4)						(0.5)						(0.6)						(0.9)
Loss ratio			57.3		%				66.0		%				60.7		%				61.9		%
Expense ratio			31.0						30.1						32.1						30.8
Dividend ratio			0.2						0.5												0.3
Combined ratio			88.5		%				96.6		%				92.8		%				93.0		%
Combined ratio excluding catastrophes and development			89.8		%				92.1		%				90.7		%				91.1		%
Rate			7		%				5		%				7		%				6		%
Renewal premium change			8						8						11						8
Retention			86						86						79						85
New business			$	407					$	754					$	245					$	1,406

Nine Months Ended September 30, 2021
Gross written premiums			$	5,650					$	3,284					$	958					$	9,892
Gross written premiums excluding third-party captives			2,656						3,176						958						6,790
Net written premiums			2,350						2,622						783						5,755
Net earned premiums			2,270						2,629						789						5,688
Net investment income			367						463						42						872
Core income			531						233						67						831
Other performance metrics:
Loss ratio excluding catastrophes and development			59.1		%				60.8		%				59.2		%				59.9		%
Effect of catastrophe impacts			0.4						12.6						2.0						6.3
Effect of development-related items			(1.7)						0.6						0.3						(0.4)
Loss ratio			57.8		%				74.0		%				61.5		%				65.8		%
Expense ratio			30.4						31.4						33.3						31.3
Dividend ratio			0.1						0.6												0.3
Combined ratio			88.3		%				106.0		%				94.8		%				97.4		%
Combined ratio excluding catastrophes and development			89.6		%				92.8		%				92.5		%				91.5		%
Rate			11		%				8		%				14		%				10		%
Renewal premium change			12						11						13						11
Retention			84						82						77						82
New business			$	370					$	615					$	204					$	1,189

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Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Gross written premiums, excluding third-party captives, for Specialty increased $15 million for the three months ended September 30, 2022 as compared with the comparable 2021 period driven by retention and rate. Net written premiums for Specialty increased $18 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. The increase in net earned premiums for the three months ended September 30, 2022 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $177 million for the three months ended September 30, 2022 as compared with the comparable 2021 period driven by higher new business and rate. Net written premiums for Commercial increased $131 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. The increase in net earned premiums for the three months ended September 30, 2022 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $12 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. Excluding the effect of foreign currency exchange rates, gross written premiums increased $31 million driven by higher new business and rate. Net written premiums for International increased $2 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. Excluding the effect of foreign currency exchange rates, net written premiums increased $19 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. Net earned premiums for the three months ended September 30, 2022 were consistent with the comparable 2021 period for International.

Core income for Property & Casualty Operations increased $43 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to improved underwriting results and higher net investment income from fixed income securities partially offset by lower net investment income from limited partnerships and common stock results.

Total catastrophe losses were $114 million for the three months ended September 30, 2022 as compared with $178 million for the comparable 2021 period. For the three months ended September 30, 2022 and 2021, Specialty had catastrophe losses of $1 million and $3 million, Commercial had catastrophe losses of $103 million and $166 million and International had catastrophe losses of $10 million and $9 million.

Favorable net prior year loss reserve development of $17 million and $10 million was recorded for the three months ended September 30, 2022 and 2021. For the three months ended September 30, 2022 and 2021, Specialty recorded favorable net prior year loss reserve development of $15 million in each period, Commercial recorded favorable net prior year loss reserve development of $2 million and unfavorable net prior year loss reserve development of $2 million and International recorded no net prior year loss reserve development and unfavorable net prior year loss reserve development of $3 million. Further information on net prior year loss reserve development is included in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 0.5 points for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a 1.1 point increase in the expense ratio largely offset by a 1.0 point improvement in the loss ratio. The increase in the expense ratio was largely due to higher underwriting expenses driven by investments in technology and talent. The improvement in the loss ratio was primarily driven by improved current accident year underwriting results.

Commercial’s combined ratio improved 9.7 points for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a 9.1 point improvement in the loss ratio and a 0.5 point improvement in the expense ratio. The improvement in the loss ratio was primarily driven by lower catastrophe losses which were 10.0 points of the loss ratio for the three months ended September 30, 2022, as compared with 18.6 points of the loss ratio in the comparable 2021 period. The improvement in the expense ratio of 0.5 points was driven by higher net earned premiums and lower acquisition costs partially offset by an increase in underwriting expenses.

International’s combined ratio improved 1.1 points for the three months ended September 30, 2022 as compared with the comparable 2021 period due to a 0.7 point improvement in the loss ratio and a 0.4 point improvement in the expense ratio. The improvement in the loss ratio was primarily due to improved non-catastrophe underwriting results. Catastrophe losses were 4.1 points of the loss ratio for the three months ended September 30, 2022, as compared with 3.4 points of the loss ratio in the comparable 2021 period. The improvement in the expense ratio of 0.4 points was primarily driven by lower acquisition costs partially offset by an increase in underwriting expenses.

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Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Gross written premiums, excluding third-party captives, for Specialty increased $160 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period driven by retention and higher new business. Net written premiums for Specialty increased $93 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. The increase in net earned premiums for the nine months ended September 30, 2022 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $540 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period driven by higher new business and retention. Net written premiums for Commercial increased $475 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. The prior period included a one-time written premium catch-up resulting from the addition of a quota share treaty to CNA’s property reinsurance program. Excluding the impact of the prior period written premium catch-up, net written premiums increased $363 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. The increase in net earned premiums for the nine months ended September 30, 2022 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $75 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. Excluding the effect of foreign currency exchange rates, gross written premiums increased $121 million driven by higher new business and retention. Net written premiums for International increased $56 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. Excluding the effect of foreign currency exchange rates, net written premiums increased $97 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. The increase in net earned premiums for the nine months ended September 30, 2022 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $67 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to improved underwriting results and higher net investment income from fixed income securities partially offset by lower net investment income from limited partnership and common stock results.

Total catastrophe losses were $171 million for the nine months ended September 30, 2022 as compared with $357 million for the comparable 2021 period. For the nine months ended September 30, 2022 and 2021, Specialty had catastrophe losses of $2 million and $9 million, Commercial had catastrophe losses of $148 million and $332 million and International had catastrophe losses of $21 million and $16 million.

Favorable net prior year loss reserve development of $66 million and $36 million was recorded for the nine months ended September 30, 2022 and 2021. For the nine months ended September 30, 2022 and 2021, Specialty recorded favorable net prior year loss reserve development of $35 million and $40 million, Commercial recorded favorable net prior year loss reserve development of $26 million and unfavorable net prior year loss reserve development of $2 million and International recorded favorable net prior year loss reserve development of $5 million and unfavorable net prior year loss reserve development of $2 million. Further information on net prior year loss reserve development is included in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 0.2 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a 0.6 point increase in the expense ratio largely offset by a 0.5 point improvement in the loss ratio. The increase in the expense ratio was largely due to higher underwriting expenses driven by investments in technology and talent. The improvement in the loss ratio was primarily driven by improved current accident year underwriting results. Catastrophe losses were 0.1 point of the loss ratio for the nine months ended September 30, 2022, as compared with 0.4 points of the loss ratio in the comparable 2021 period.

Commercial’s combined ratio improved 9.4 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to an 8.0 point improvement in the loss ratio and a 1.3 point improvement in the expense ratio. The improvement in the loss ratio was driven by lower catastrophe losses which were 5.0 points of the loss ratio for the nine months ended September 30, 2022, as compared with 12.6 points of the loss ratio in the comparable 2021 period, and favorable net prior year loss reserve development. The combined ratio excluding catastrophes and development improved 0.7 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period. The improvement in the expense ratio of 1.3 points was driven by higher net earned premiums and lower acquisition costs partially offset by an increase in underwriting expenses. The loss ratio excluding catastrophes and development increased 0.7 points primarily driven by a shift in mix of business associated with the property quota share treaty purchased during June of 2021. Property coverages, which have a lower underlying loss ratio than most other commercial coverages, now represent a smaller proportion of net earned premiums.

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International’s combined ratio improved 2.0 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period due to a 1.2 point improvement in the expense ratio and a 0.8 point improvement in the loss ratio. The improvement in the expense ratio was primarily driven by lower acquisition costs. The improvement in the loss ratio was driven by improved non-catastrophe underwriting results, partially offset by higher net catastrophe losses. Catastrophe losses were 2.7 points of the loss ratio for the nine months ended September 30, 2022, as compared with 2.0 points of the loss ratio in the comparable 2021 period.

Other Insurance Operations

The following table summarizes the results of CNA’s Other Insurance Operations for the three and nine months ended September 30, 2022 and 2021.

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Net earned premiums			$	118					$	123		$	356					$	369
Net investment income			192						242			610						736
Core income (loss)			(47)						20			(124)						10

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Core results for Other Insurance Operations decreased $67 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a $54 million pretax decline in net investment income from limited partnerships. Results for the three months ended September 30, 2022 and 2021 included no unlocking event for future policy benefit reserves as a result of the gross premium valuation (“GPV”). Core loss for the three months ended September 30, 2022 included a $25 million pretax favorable impact from the reduction in long term care claim reserves resulting from the annual claim reserve review in the third quarter of 2022. The favorable impact was driven by a $107 million release of all remaining incurred but not reported (“IBNR”) reserves established during 2020 and 2021 in response to the COVID-19 pandemic partially offset by an $82 million unfavorable impact from higher claim severity, including utilization and cost of care inflation, than anticipated in the reserve estimates. The annual structured settlement claim reserve review resulted in a $5 million pretax favorable impact from the reduction in reserves due to discount rate assumption changes. Core income for the three months ended September 30, 2021 included a $40 million pretax favorable impact from the reduction in long term care claim reserves resulting from the annual claim reserve reviews in the third quarter of 2021.

Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Core results for Other Insurance Operations decreased $134 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, the drivers of which were generally consistent with the three month discussion above. In addition, core results for the nine months ended September 30, 2022 included higher net prior year loss reserve development associated with legacy mass tort abuse claims and an increase in expenses as a result of continued investments in technology infrastructure and security as compared with the comparable 2021 period. These results were partially offset by the prior period recognition of a $12 million loss resulting from the legacy excess workers’ compensation loss portfolio transfer (“EWC LPT”). Net prior year loss reserve development is further discussed in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1.

Life & Group Policyholder Reserves

Annually, in the third quarter, CNA assesses the adequacy of its long term care future policy benefit reserves by performing a GPV to determine if there is a premium deficiency. See the Insurance Reserves section of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021 for further information on the reserving process.

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The September 30, 2022 GPV indicated that the recorded reserves included a margin of approximately $125 million. A summary of the changes in the estimated reserve margin is presented in the table below:

(In millions)
Long term care active life reserve - change in estimated reserve margin
September 30, 2021 estimated margin			$	72
Changes in underlying economic assumptions (a)			(130)
Changes in underlying morbidity assumptions			(30)
Changes in underlying persistency assumptions			40
Changes in underlying premium rate action assumptions			190
Changes in underlying expense and other assumptions			(17)
September 30, 2022 Estimated Margin			$	125

(a)			Economic assumptions include the impact of interest rates and cost of care inflation.

The increase in the margin in 2022 was primarily driven by changes in discount rate assumptions due to higher near term expected reinvestment rates and higher than previously estimated rate increases on active rate increase programs. These favorable drivers were partially offset by changes in cost of care inflation assumptions.

CNA has determined that additional future policy benefit reserves for profits followed by losses are not currently required based on the most recent projection.

The table below summarizes the estimated pretax impact on CNA’s results of operations from various hypothetical revisions to its future policy benefit reserve assumptions. The annual GPV process involves updating all assumptions to management’s then current best estimate, and historically all significant assumptions have been revised each year. In the table below, CNA has assumed that revisions to such assumptions would occur in each policy type, age and duration within each policy group. The impact of each sensitivity is discrete and does not reflect the impact one factor may have on another or the mitigating impact from CNA’s actions, which may include additional future premium rate increases. Although such hypothetical revisions are not currently required or anticipated, CNA believes they could occur based on past variances in experience and its expectations of the ranges of future experience that could reasonably occur. Any required increase in the recorded reserves resulting from a hypothetical revision in the table below would first reduce the margin in the carried reserves before it would affect results from operations. Any actual adjustment would be dependent on the specific policies affected and, therefore, may differ from the estimates summarized below. The estimated impacts to results of operations in the table below are after consideration of the existing margin.

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September 30, 2022			Estimated Reduction to Pretax Income
(In millions)
Hypothetical revisions
Morbidity: (a)
2.5% increase in morbidity			$	200
5% increase in morbidity			500
Persistency:
5% decrease in active life mortality and lapse			$	100
10% decrease in active life mortality and lapse			300
Discount rates:
25 basis point decline in new money interest rates			$	—
50 basis point decline in new money interest rates			100

(a)			Represents a sensitivity in future paid claims.

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Non-GAAP Reconciliation of Core Income to Net Income

The following table reconciles core income to net income attributable to Loews Corporation for the three and nine months ended September 30, 2022 and 2021:

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Core income (loss):
Property & Casualty Operations			$	260					$	217		$	898					$	831
Other Insurance Operations			(47)						20			(124)						10
Total core income			213						237			774						841
Investment gains (losses)			(84)						18			(127)						94
Consolidating adjustments including noncontrolling interests			(14)						(26)			(68)						(97)
Net income attributable to Loews Corporation			$	115					$	229		$	579					$	838

Boardwalk Pipelines

A significant portion of Boardwalk Pipelines’ revenues is fee-based, being derived from capacity reservation charges under firm agreements with customers, which do not vary significantly period to period, but are impacted by longer term trends in its business such as changes in pricing on contract renewals and other factors. Boardwalk Pipelines’ operating costs and expenses do not vary significantly based upon the amount of products transported, with the exception of costs recorded in fuel and transportation expense, which are netted with fuel retained on our Consolidated Condensed Statements of Operations. For further information on Boardwalk Pipelines’ revenue recognition policies see Note 1 of the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2021.

Boardwalk Pipelines’ operations and maintenance expenses are impacted by its compliance with the requirements of, among other regulations, the Pipeline and Hazardous Materials Safety Administration Mega Rule (“Mega Rule”), as further discussed in Results of Operations of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021.

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The following table summarizes the results of operations for Boardwalk Pipelines for the three and nine months ended September 30, 2022 and 2021, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report. Boardwalk Pipelines also utilizes earnings before interest, income tax expense, depreciation and amortization (“EBITDA”), a non-GAAP measure, as a financial measure to assess its operating and financial performance and return on invested capital. Management believes some investors may find this measure useful in evaluating Boardwalk Pipelines’ performance.

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Revenues:
Operating revenues and other			$	339					$	307		$	1,045					$	991
Total			339						307			1,045						991
Expenses:
Operating and other:
Operating costs and expenses			147						123			401						364
Depreciation and amortization			103						92			297						277
Interest			42						40			126						121
Total			292						255			824						762
Income before income tax			47						52			221						229
Income tax expense			(13)						(14)			(57)						(59)
Net income attributable to Loews Corporation			$	34					$	38		$	164					$	170
EBITDA			$	192					$	184		$	644					$	627

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $4 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. EBITDA increased $8 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. The decrease in net income as compared with the increase in EBITDA is primarily due to the increase in depreciation and amortization expense and interest expense as discussed below.

Total revenues increased $32 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. Including the items in fuel and transportation expense, operating revenues increased $28 million, primarily driven by an increase in transportation revenues of $25 million due to recently completed growth projects, higher utilization-based revenues and re-contracting at higher rates. In addition, storage and parking and lending revenues increased $5 million due to favorable market conditions.

Operating costs and expenses increased $24 million for the three months ended September 30, 2022 as compared with the comparable 2021 period. Excluding items offset with operating revenues, operating costs and expenses increased $20 million, primarily due to increased costs from maintenance projects associated with compliance with the requirements of the Mega Rule and asset impairment charges resulting from an increase in the estimate of existing asset retirement obligations related to retired assets.

Depreciation and amortization expenses increased $11 million for the three months ended September 30, 2022 as compared with the comparable 2021 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expenses increased $2 million for the three months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to higher average outstanding long-term debt.

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Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $6 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. EBITDA increased $17 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. The decrease in net income as compared with the increase in EBITDA is primarily due to the increase in depreciation and amortization expense and interest expense as discussed below.

Total revenues increased $54 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. Including the items in fuel and transportation expense, operating revenues increased $50 million, primarily driven by an increase in transportation revenues of $41 million due to recently completed growth projects, re-contracting at higher rates and higher utilization-based revenues. In addition, storage and parking and lending revenues increased $11 million due to favorable market conditions.

Operating costs and expenses increased $37 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period. Excluding items offset with operating revenues, operating costs and expenses increased $33 million, primarily due to increased costs from maintenance projects associated with compliance with the requirements of the Mega Rule and asset impairment charges resulting from an increase in the estimate of existing asset retirement obligations related to retired assets.

Depreciation and amortization expenses increased $20 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expense increased $5 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to higher average outstanding long-term debt.

Non-GAAP Reconciliation of Net Income attributable to Loews Corporation to EBITDA

The following table for Boardwalk Pipelines presents a reconciliation of net income attributable to Loews Corporation to EBITDA for the three and nine months ended September 30, 2022 and 2021:

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Net income attributable to Loews Corporation			$	34					$	38		$	164					$	170
Income tax expense			13						14			57						59
Depreciation and amortization			103						92			297						277
Interest			42						40			126						121
EBITDA			$	192					$	184		$	644					$	627

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Loews Hotels & Co

The following table summarizes the results of operations for Loews Hotels & Co for the three and nine months ended September 30, 2022 and 2021, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Revenues:
Operating revenue			$	149					$	107		$	440					$	222
Revenues related to reimbursable expenses			31						27			92						67
Total			180						134			532						289
Expenses:
Operating and other:
Operating			128						93			359						231
Asset impairment			8									22
Reimbursable expenses			31						27			92						67
Depreciation and amortization expense			16						15			47						47
Equity income from joint ventures			(36)						(26)			(115)						(17)
Interest			(1)						8			7						25
Total			146						117			412						353
Income (loss) before income tax			34						17			120						(64)
Income tax (expense) benefit			(9)						(4)			(36)						13
Net income (loss) attributable to Loews Corporation			$	25					$	13		$	84					$	(51)

Net income (loss) attributable to Loews Corporation improved by $12 million and $135 million for the three and nine months ended September 30, 2022 as compared to the comparable prior year periods.

Loews Hotels & Co’s results significantly improved for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods as overall travel demand and resulting business levels were considerably higher in 2022. Travel has significantly rebounded from the impacts of the COVID-19 pandemic, causing overall occupancy rates to improve.

Operating revenues improved by $42 million and $218 million and operating expenses increased by $35 million and $128 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods. The increase in operating revenues was driven by stronger occupancy levels and higher average daily rates at many hotels in 2022 as compared to 2021. Operating expenses have likewise increased to support the higher demand levels and resumption of additional pre-pandemic services.

Equity income from joint ventures improved $10 million and $98 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods. The increase in equity income from joint ventures was driven by stronger occupancy levels and higher average daily rates at many joint venture hotels, particularly at the Universal Orlando Resort, during 2022 as compared to 2021. Operating expenses have likewise increased to support the higher demand levels and resumption of additional pre-pandemic services at those joint venture hotels. Additionally, improvement in the 2022 nine months period also resulted from having all 9,000 rooms available at the Universal Orlando Resort for the entire 2022 period whereas certain properties were not available for periods of 2021.

The three and nine months ended September 30, 2022 include impairment charges of $8 million and $22 million to reduce the carrying value of an asset to its estimated fair value.

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Interest expense decreased $9 million and $18 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods due primarily to the increase in fair value of an interest rate cap of $7 million and $11 million that was executed in the first quarter of 2022, higher capitalized interest on a project under development, and lower average debt balances.

Corporate

Corporate operations consist primarily of investment income, interest expense and administrative costs at the Parent Company. Investment income includes earnings on cash and short term investments held at the Parent Company to meet current and future liquidity needs, as well as results of the trading portfolio held at the Parent Company. Corporate also includes the consolidated operations of Altium Packaging through March 31, 2021 and the equity method of accounting for Altium Packaging subsequent to its deconsolidation on April 1, 2021.

The following table summarizes the results of operations for Corporate for the three and nine months ended September 30, 2022 and 2021 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report:

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Revenues:
Net investment income (loss)			$	(19)					$	(30)		$	(100)					$	40
Investment gains																		540
Operating revenues and other			4						1			6						282
Total			(15)						(29)			(94)						862
Expenses:
Operating and other			17						27			62						365
Interest			23						23			67						93
Total			40						50			129						458
Income (loss) before income tax			(55)						(79)			(223)						404
Income tax (expense) benefit			11						19			44						(126)
Net income (loss) attributable to Loews Corporation			$	(44)					$	(60)		$	(179)					$	278

Net investment loss for the Parent Company decreased $11 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to improved results from short term investments in the Parent Company trading portfolio. Net investment loss was $100 million for the nine months ended September 30, 2022 as compared with net investment income of $40 million in the comparable 2021 period primarily due to the decline in fair value of equity based investments.

Investment gains of $540 million for the nine months ended September 30, 2021 were primarily due to a gain of $555 million ($438 million after tax) on the sale of 47% of Altium Packaging and its deconsolidation on April 1, 2021.

Operating revenues and other for the nine months ended September 30, 2021 include $280 million of consolidated operating revenues for Altium Packaging through March 31, 2021.

Operating and other expenses decreased $10 million for the three months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to lower corporate expenses at the Parent Company. Operating and other expenses decreased $303 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to $279 million of operating expenses for Altium Packaging through March 31, 2021 prior to its deconsolidation and use of the equity method for Altium Packaging since its deconsolidation. In addition, there were lower corporate expenses at the Parent Company for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

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Interest expenses decreased $26 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period due to consolidated interest expenses for Altium Packaging through March 31, 2021, which included a charge of approximately $14 million to write off debt issuance costs for the early retirement of debt.

Income tax expense of $126 million for the nine months ended September 30, 2021 includes the recognition of $117 million of taxes on the investment gain and the recognition of a $40 million deferred tax liability, both of which are related to the sale of 47% of Altium Packaging.

LIQUIDITY AND CAPITAL RESOURCES

Parent Company

Parent Company cash and investments, net of receivables and payables, totaled $3.2 billion at September 30, 2022 as compared to $3.4 billion at December 31, 2021. During the nine months ended September 30, 2022, we received $778 million in cash dividends from CNA, including a special cash dividend of $486 million. Cash outflows during the nine months ended September 30, 2022 included the payment of $611 million to fund treasury stock purchases, $46 million of cash dividends to our shareholders, $26 million to purchase common shares of CNA and equity contributions of $33 million to Loews Hotels & Co and $79 million to Altium Packaging. As a holding company we depend on dividends from our subsidiaries and returns on our investment portfolio to fund our obligations. We also have an effective shelf registration statement on file with the Securities and Exchange Commission (“SEC”) registering the future sale of an unspecified amount of our debt, equity or hybrid securities from time to time. We are not responsible for the liabilities and obligations of our subsidiaries and there are no Parent Company guarantees.

Depending on market and other conditions, we may purchase our shares and shares of our subsidiaries outstanding common stock in the open market, in privately negotiated transactions or otherwise. During the nine months ended September 30, 2022, we purchased 10.5 million shares of Loews Corporation common stock and 0.7 million shares of CNA’s common stock. As of October 28, 2022, we had purchased an additional 0.7 million shares of Loews Corporation common stock in 2022 at an additional aggregate cost of $38 million. As of October 28, 2022, there were 237,427,052 shares of Loews Corporation common stock outstanding.

Future uses of our cash may include investing in our subsidiaries, new acquisitions, dividends and/or repurchases of our and our subsidiaries’ outstanding common stock. The declaration and payment of future dividends to holders of our common stock will be at the discretion of our Board of Directors and will depend on many factors, including our earnings, financial condition and business needs.

Subsidiaries

CNA’s cash provided by operating activities was $2.0 billion for the nine months ended September 30, 2022 and $1.4 billion for the comparable 2021 period. The increase in cash provided by operating activities was driven by the prior year payment of the EWC LPT premium.

CNA paid cash dividends of $3.20 per share on its common stock, including a special cash dividend of $2.00 per share, during the nine months ended September 30, 2022. On October 28, 2022, CNA’s Board of Directors declared a quarterly cash dividend of $0.40 per share payable December 1, 2022 to shareholders of record on November 15, 2022. CNA’s declaration and payment of future dividends is at the discretion of its Board of Directors and will depend on many factors, including CNA’s earnings, financial condition, business needs and regulatory constraints. CNA believes that its present cash flows from operating, investing and financing activities are sufficient to fund its current and expected working capital and debt obligation needs and does not expect this to change in the near term.

Dividends to CNA from Continental Casualty Company (“CCC”), a subsidiary of CNA, are subject to the insurance holding company laws of the State of Illinois, the domiciliary state of CCC. Under these laws, ordinary dividends, or dividends that do not require prior approval by the Illinois Department of Insurance (the “Department”), are determined based on the greater of the prior year’s statutory net income or 10% of statutory surplus as of the end of the prior year, as well as the timing and amount of dividends paid in the preceding 12 months. Additionally, ordinary dividends may only be paid from earned surplus, which is calculated by removing unrealized gains from unassigned surplus. As of September 30, 2022, CCC was in a positive earned surplus position. CCC paid dividends of $845 million and $600 million during the nine months ended September 30, 2022 and 2021. The actual level of dividends paid in any year is determined after an assessment of available dividend capacity, holding company liquidity and cash needs as well as the impact the dividends will have on the statutory surplus of the applicable insurance company.

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CNA has an effective shelf registration statement on file with the SEC under which it may publicly issue an unspecified amount of debt, equity or hybrid securities from time to time.

Boardwalk Pipelines’ cash provided by operating activities increased $55 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to the timing of gas transportation receivables and the impacts of higher natural gas prices on fuel tracker activities.

For the nine months ended September 30, 2022 and 2021, Boardwalk Pipelines’ capital expenditures were $208 million and $239 million, consisting of growth capital expenditures of $122 million and $130 million and maintenance capital expenditures of $79 million and $89 million. During the nine months ended September 30, 2022, Boardwalk Pipelines also spent $7 million on natural gas to be used in its integrated natural gas pipeline system. During the nine months ended September 30, 2021, Boardwalk Pipelines acquired certain natural gas pipeline assets for approximately $20 million.

Boardwalk Pipelines anticipates that its existing capital resources, including its cash on hand, revolving credit facility and cash flows from operating activities, will be adequate to fund its operations and capital expenditures for 2022 and to retire the outstanding $300 million aggregate principal amount of its 3.4% senior notes due in February of 2023 (“2023 Notes”). Boardwalk Pipelines also has an effective shelf registration statement on file with the SEC under which it may publicly issue $1.0 billion of debt securities, warrants or rights from time to time. In February of 2022, Boardwalk Pipelines completed a public offering of $500 million aggregate principal amount of its 3.6% senior notes due September 1, 2032, which utilized $500 million of capacity under its shelf registration statement. Boardwalk Pipelines used the proceeds to retire the outstanding $300 million aggregate principal amount of its 4.0% senior notes due June 2022 in March of 2022, to fund growth capital expenditures and for general corporate purposes. In September of 2022, Boardwalk Pipelines notified the holders of the 2023 Notes that it intends to retire the 2023 Notes on November 1, 2022, at a redemption price of 100% of the principal amount plus any unpaid and accrued interest. Boardwalk Pipelines will fund the retirement of the 2023 Notes from available cash.

In June of 2022, Boardwalk Pipelines’ revolving credit facility was amended to, among other things, extend the maturity date by one year to May 27, 2027, while preserving the two one-year extensions that can be exercised at Boardwalk Pipelines’ election and complete a full transition to interest rates based on the term Secured Overnight Financing Rate (“SOFR”). As of September 30, 2022, Boardwalk Pipelines had no outstanding borrowings and all of the $1.0 billion available borrowing capacity under its revolving credit facility.

As of September 30, 2022, Loews Hotels & Co has a $13 million loan that matures within twelve months, which it currently intends to pay off in the fourth quarter of 2022. Loews Hotels & Co, through its subsidiaries, has loans maturing beyond twelve months which it will work to refinance prior to maturity. Extending any indebtedness, including loans of unconsolidated joint venture partnerships, may require Loews Hotels & Co to make principal pay downs, establish restricted cash reserves or provide guaranties of the subsidiary’s debt. Through the date of this Report, none of Loews Hotels & Co’s subsidiaries are in default on any of their loans.

In October of 2022, Loews Hotels & Co contributed $34 million as an initial investment in two joint venture development projects expected to open in 2025. These projects are currently estimated to require an aggregate investment of approximately $200 million in capital contributions from Loews Hotels & Co. Based on the timing of capital calls relative to the seasonality of Loews Hotels & Co’s business, capital contributions from Loews Corporation to Loews Hotels & Co may be required.

Through October 28, 2022, Loews Hotels & Co received capital contributions of $33 million from Loews Corporation to fund development projects during 2022.

In August of 2022, we made a cash contribution of $79 million to our equity method investee, Altium Packaging. These funds and a pro rata contribution from our joint venture partner were used by Altium Packaging for acquisitions which expand its offerings and increase its bottle manufacturing capabilities throughout key industries and geographies.

INVESTMENTS

Investment activities of our non-insurance subsidiaries primarily consist of investments in fixed income securities, including short term investments. The Parent Company portfolio also includes equity securities, including short sales and derivative instruments, and investments in limited partnerships. Certain of these types of Parent Company investments generally have greater volatility, less liquidity and greater risk than fixed income investments and are included within Results of Operations – Corporate.

The Parent Company enters into short sales and invests in certain derivative instruments that are used for asset and liability management activities, income enhancements to its portfolio management strategy and to benefit from anticipated

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future movements in the underlying markets. If such movements do not occur as anticipated, then significant losses may occur. Monitoring procedures include senior management review of daily reports of existing positions and valuation fluctuations to seek to ensure that open positions are consistent with the portfolio strategy.

Credit exposure associated with non-performance by counterparties to derivative instruments is generally limited to the uncollateralized change in fair value of the derivative instruments recognized in the Consolidated Condensed Balance Sheets. The risk of non-performance is mitigated by monitoring the creditworthiness of counterparties and diversifying derivatives by using multiple counterparties. Collateral is occasionally required from derivative investment counterparties depending on the amount of the exposure and the credit rating of the counterparty.

Insurance

CNA maintains a large portfolio of fixed maturity and equity securities, including large amounts of corporate and government issued debt securities, residential and commercial mortgage-backed securities, other asset-backed securities and investments in limited partnerships which pursue a variety of long and short investment strategies across a broad array of asset classes. CNA’s investment portfolio supports its obligation to pay future insurance claims and provides investment returns which are an important part of CNA’s overall profitability.

Net Investment Income

The significant components of CNA’s net investment income are presented in the following table. Fixed income securities, as presented, include both fixed maturity securities and non-redeemable preferred stock.

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Fixed income securities:
Taxable fixed income securities			$	410					$	360		$	1,163					$	1,075
Tax-exempt fixed income securities			55						77			194						236
Total fixed income securities			465						437			1,357						1,311
Limited partnership and common stock investments			(44)						77			(51)						294
Other, net of investment expense			1						(1)			(4)						3
Net investment income			$	422					$	513		$	1,302					$	1,608

Effective income yield for the fixed income securities portfolio			4.4		%				4.3		%	4.3		%				4.3		%
Limited partnership and common stock return			(2.1)%						3.8		%	(2.4)%						16.4		%

CNA’s net investment income decreased $91 million and $306 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods, driven by unfavorable limited partnership and common stock results, partially offset by higher income from fixed income securities.

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Investment Gains (Losses)

The components of CNA’s investment gains (losses) are presented in the following table:

			Three Months Ended									Nine Months Ended
			September 30,									September 30,
			2022						2021			2022						2021
(In millions)
Investment gains (losses):
Fixed maturity securities: (a)
Corporate and other bonds			$	(41)					$	36		$	(68)					$	115
States, municipalities and political subdivisions			6						1			28
Asset-backed			(17)						(15)			(29)						(24)
Total fixed maturity securities			(52)						22			(69)						91
Non-redeemable preferred stock			(2)						(2)			(111)						17
Derivatives, short term and other			(42)						2			14						9
Total investment gains (losses)			(96)						22			(166)						117
Income tax (expense) benefit			12						(4)			39						(23)
Amounts attributable to noncontrolling interests			8						(2)			12						(10)
Investment gains (losses) attributable to Loews Corporation			$	(76)					$	16		$	(115)					$	84

(a)			Excludes the loss in the third quarter of 2022 on the assets supporting the funds withheld liability, which is reflected in the Derivatives, short term and other line.

CNA’s pretax investment results decreased $118 million for the three months ended September 30, 2022 as compared with the comparable 2021 period, driven by the net losses on fixed maturity securities in the three months ended September 30, 2022 as compared to net gains in the comparable 2021 period.

Additionally, Derivatives, short term and other for the three months ended September 30, 2022 includes a $35 million non-economic net loss related to the expected novation of a coinsurance agreement on CNA’s legacy annuity business in its Other Insurance Operations and the associated funds withheld embedded derivative.

CNA’s pretax investment results decreased $283 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, driven by the unfavorable change in fair value of non-redeemable preferred stock and net losses on fixed maturity securities in the nine months ended September 30, 2022 as compared to net gains in the comparable 2021 period.

Further information on CNA’s investment gains and losses is set forth in Note 2 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Portfolio Quality

The following table presents the estimated fair value and net unrealized gains (losses) of CNA’s fixed maturity securities by rating distribution:

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			September 30, 2022												December 31, 2021
			Estimated Fair Value						Net Unrealized Gains (Losses)						Estimated Fair Value						Net Unrealized Gains (Losses)
(In millions)
U.S. Government, Government agencies and Government-sponsored enterprises			$	2,452					$	(357)					$	2,600					$	42
AAA			2,374						(250)						3,784						360
AA			6,387						(792)						7,665						823
A			8,739						(667)						9,511						1,087
BBB			15,267						(1,776)						18,458						2,043
Non-investment grade			2,032						(234)						2,362						91
Total			$	37,251					$	(4,076)					$	44,380					$	4,446

As of September 30, 2022 and December 31, 2021, 1% of CNA’s fixed maturity portfolio was rated internally. AAA rated securities included $0.4 billion and $1.7 billion of pre-refunded municipal bonds as of September 30, 2022 and December 31, 2021.

The following table presents CNA’s available-for-sale fixed maturity securities in a gross unrealized loss position by ratings distribution:

September 30, 2022			Estimated Fair Value						Gross Unrealized Losses
(In millions)
U.S. Government, Government agencies and Government-sponsored enterprises			$	2,360					$	360
AAA			1,566						318
AA			4,430						917
A			6,548						838
BBB			13,394						1,902
Non-investment grade			1,646						248
Total			$	29,944					$	4,583

The following table presents the maturity profile for these available-for-sale fixed maturity securities. Securities not due to mature on a single date are allocated based on weighted average life:

September 30, 2022			Estimated Fair Value						Gross Unrealized Losses
(In millions)
Due in one year or less			$	699					$	11
Due after one year through five years			7,492						541
Due after five years through ten years			10,701						1,705
Due after ten years			11,052						2,326
Total			$	29,944					$	4,583

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Duration

A primary objective in the management of CNA’s investment portfolio is to optimize return relative to the corresponding liabilities and respective liquidity needs. CNA’s views on the current interest rate environment, tax regulations, asset class valuations, specific security issuer and broader industry segment conditions as well as domestic and global economic conditions, are some of the factors that enter into an investment decision. CNA also continually monitors exposure to issuers of securities held and broader industry sector exposures and may from time to time adjust such exposures based on its views of a specific issuer or industry sector.

A further consideration in the management of CNA’s investment portfolio is the characteristics of the corresponding liabilities and the ability to align the duration of the portfolio to those liabilities and to meet future liquidity needs, minimize interest rate risk and maintain a level of income sufficient to support the underlying insurance liabilities. For portfolios where future liability cash flows are determinable and typically long term in nature, CNA segregates investments for asset/liability management purposes. The segregated investments support the long term care and structured settlement liabilities in Other Insurance Operations.

The effective durations of CNA’s fixed income securities and short term investments are presented in the following table. Amounts presented are net of payable and receivable amounts for securities purchased and sold, but not yet settled.

			September 30, 2022												December 31, 2021
			Estimated Fair Value						Effective Duration (Years)						Estimated Fair Value						Effective Duration (Years)
(In millions of dollars)
Investments supporting Other Insurance Operations			$	14,253					9.8						$	18,458					9.2
Other investments			24,739						4.8						28,915						4.9
Total			$	38,992					6.7						$	47,373					6.6

The effective duration of investments supporting Other Insurance Operations liabilities at September 30, 2022 lengthened as compared with December 31, 2021, reflecting strategic repositioning to capitalize on higher rates and reduce reinvestment risk.

CNA’s investment portfolio is periodically analyzed for changes in duration and related price risk. Certain securities have duration characteristics that are variable based on market interest rates, credit spreads and other factors that may drive variability in the amount and timing of cash flows. Additionally, CNA periodically reviews the sensitivity of the portfolio to the level of foreign exchange rates and other factors that contribute to market price changes. A summary of these risks and specific analysis on changes is included in the Quantitative and Qualitative Disclosures about Market Risk included under Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2021.

CRITICAL ACCOUNTING ESTIMATES

Certain accounting policies require us to make estimates and judgments that affect the amounts reflected in the Consolidated Condensed Financial Statements. Such estimates and judgments necessarily involve varying, and possibly significant, degrees of uncertainty. Accordingly, certain amounts currently recorded or disclosed in the financial statements will likely be adjusted in the future based on new available information and changes in other facts and circumstances. See the Critical Accounting Estimates and the Insurance Reserves sections of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021 for further information.

ACCOUNTING STANDARDS UPDATE

In August 2018, the Financial Accounting Standards Board issued Accounting Standards Update 2018-12, “Financial Services - Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts.” The updated accounting guidance requires changes to the measurement and disclosure of long-duration contracts. For the Company, this includes CNA’s long term care and fully-ceded single premium immediate annuity business.

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The most significant impact will be the effect of updating the discount rate assumption quarterly to reflect an upper-medium grade fixed-income instrument yield, rather than the expected investment portfolio yield. This will be partially offset by the de-recognition of Shadow Adjustments associated with long-duration contracts. The net impact of these changes is expected to be a decrease of approximately $2.1 billion (after tax and noncontrolling interests) in Accumulated other comprehensive income as of the transition date of January 1, 2021. To illustrate the sensitivity of this adjustment, had the interest rates in effect as of September 30, 2022 been used in the calculation, the transition impact to AOCI would have been approximately zero.

The requirement to review, and update if there is a change, cash flow assumptions at least annually is expected to change the pattern of earnings being recognized. Under current accounting guidance, the third quarter 2022 gross premium valuation assessment indicated a pretax reserve margin of $125 million, with no unlocking event. However under the new guidance, the effect of changes in cash flow assumptions from the assessment would be recorded in results of operations (except for discount rate changes which would be recorded quarterly through AOCI).

For a discussion of accounting standards updates that have been adopted or will be adopted in the future, please read Note 1 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

FORWARD-LOOKING STATEMENTS

Investors are cautioned that certain statements contained in this Report as well as in other of our and our subsidiaries’ SEC filings and periodic press releases and certain oral statements made by us and our subsidiaries and our and their officials during presentations may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”). Forward-looking statements include, without limitation, any statement that does not directly relate to any historical or current fact and may project, indicate or imply future results, events, performance or achievements. Such statements may contain the words “expect,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “will be,” “will continue,” “will likely result,” and similar expressions. In addition, any statement concerning future financial performance (including future revenues, earnings or growth rates), ongoing business strategies or prospects, and possible actions taken by us or our subsidiaries are also forward-looking statements as defined by the Act. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to a variety of risks and uncertainties, many of which are beyond our control, that could cause actual results to differ materially from those anticipated or projected.

Developments in any of the risks or uncertainties facing us or our subsidiaries, including those described under Part I, Item 1A, Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2021 and in our and our subsidiaries’ other filings with the SEC, could cause our and our subsidiaries’ results to differ materially from results that have been or may be anticipated or projected. Given these risks and uncertainties, investors should not place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date they are made and we and our subsidiaries expressly disclaim any obligation or undertaking to update these statements to reflect any change in expectations or beliefs or any change in events, conditions or circumstances on which any forward-looking statement is based.