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, 2022. This MD&A is comprised of the following sections:

			Page No.
Overview			44
Results of Operations			45
Consolidated Financial Results			45
CNA Financial			46
Boardwalk Pipelines			53
Loews Hotels & Co			55
Corporate			57
Liquidity and Capital Resources			57
Parent Company			57
Subsidiaries			58
Investments			59
Critical Accounting Estimates			65
Accounting Standards Update			66
Forward-Looking Statements			66

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, and the equity method of accounting for Altium Packaging LLC (“Altium Packaging”).

Unless the context otherwise requires, as used herein, 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, 2022) 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 the basic and diluted net income per share attributable to Loews Corporation for the three and six months ended June 30, 2023 and 2022:

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions, except per share data)
CNA Financial (a)			$	255					$	170		$	523					$	435
Boardwalk Pipelines			57						39			143						130
Loews Hotels & Co			74						44			98						59
Corporate			(26)						(86)			(29)						(135)
Net income attributable to Loews Corporation			$	360					$	167		$	735					$	489
Basic and diluted net income per share			$	1.58					$	0.68		$	3.19					$	1.98

(a)			As of January 1, 2023, Accounting Standards Update (“ASU”) 2018-12, “Financial Services – Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts,” (“ASU 2018-12”) was adopted using the modified retrospective method applied as of the transition date of January 1, 2021. Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance. For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Net income attributable to Loews Corporation for the three months ended June 30, 2023 was $360 million, or $1.58 per share, compared to $167 million, or $0.68 per share in the comparable 2022 period. Net income attributable to Loews Corporation for the six months ended June 30, 2023 was $735 million, or $3.19 per share, compared to $489 million, or $1.98 per share in the comparable 2022 period.

The increase in net income attributable to Loews Corporation in the second quarter of 2023 as compared to the comparable 2022 period was driven by higher income from consolidated subsidiaries and higher net investment income at the Parent Company. CNA’s results improved due to higher net investment income and improved underlying underwriting income, partially offset by higher catastrophe losses and lower favorable property & casualty net prior year loss reserve development. Boardwalk Pipelines produced higher revenues, partially offset by an increase in maintenance costs. Loews Hotels & Co results include a gain related to the acquisition of an additional equity interest and consolidation of a previously unconsolidated joint venture property.

The drivers of the increase in net income for the six months ended June 30, 2023 as compared to the comparable 2022 period are consistent with the three-month discussion above.

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CNA Financial

The following table summarizes the results of operations for CNA for the three and six months ended June 30, 2023 and 2022 as presented in Note 13 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.

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022 (a)			2023						2022 (a)
(In millions)
Revenues:
Insurance premiums			$	2,347					$	2,155		$	4,595					$	4,214
Net investment income			575						432			1,100						880
Investment losses			(32)						(59)			(67)						(70)
Non-insurance warranty revenue			407						392			814						774
Other revenues			7						6			14						13
Total			3,304						2,926			6,456						5,811
Expenses:
Insurance claims and policyholders’ benefits			1,779						1,601			3,432						3,079
Amortization of deferred acquisition costs			403						374			782						718
Non-insurance warranty expense			384						367			768						721
Other operating expenses			346						329			683						655
Interest			31						28			59						56
Total			2,943						2,699			5,724						5,229
Income before income tax			361						227			732						582
Income tax expense			(78)						(37)			(152)						(97)
Net income			283						190			580						485
Amounts attributable to noncontrolling interests			(28)						(20)			(57)						(50)
Net income attributable to Loews Corporation			$	255					$	170		$	523					$	435

(a)			As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021. Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance. For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation increased $85 million for the three months ended June 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income from limited partnership and common stock returns and fixed income securities, lower investment losses driven by the favorable relative change in fair value of non-redeemable preferred stock, improved underlying underwriting income and lower unfavorable net prior year loss reserve development. These increases to net income were offset by higher catastrophe losses for the three months ended June 30, 2023 as compared with the comparable 2022 period. Catastrophe losses were $68 million ($48 million after tax and noncontrolling interests) for the three months ended June 30, 2023 as compared with $37 million ($26 million after tax and noncontrolling interests) in the comparable 2022 period.

Six Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation increased $88 million for the six months ended June 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income from limited partnership and common

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stock returns and fixed income securities and improved underlying underwriting income. These increases to net income were partially offset by higher catastrophe losses and increased unfavorable net prior year loss reserve development for the six months ended June 30, 2023 as compared with the comparable 2022 period. Catastrophe losses were $120 million ($85 million after tax and noncontrolling interests) for the six months ended June 30, 2023 as compared with $57 million ($40 million after tax and noncontrolling interests) in the comparable 2022 period.

Results for the three and six months ended June 30, 2023 were impacted by unfavorable net pension costs related to CNA’s legacy United States of America (“U.S.”) pension plan, primarily due to higher interest cost on projected benefit obligations as a result of an increase in discount rates year over year, as well as a lower expected return on plan assets as a result of a lower plan asset base given actual asset returns in 2022. A portion of this additional cost has resulted in an unfavorable impact on the expense ratio for the three and six months ended June 30, 2023.

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 investment gains or losses from net income (loss). 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 net income (loss) to core 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 underlying loss ratio, the expense ratio, the dividend ratio, the combined ratio and the underlying combined ratio. 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 underlying loss ratio excludes the impact of catastrophe losses and development-related items from the loss ratio. Development-related items represent net prior year loss reserve and premium development, and includes the effects of interest accretion and change in allowance for uncollectible reinsurance and deductible amounts. 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 underlying combined ratio is the sum of the underlying loss ratio, 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. The change in exposure represents the change in premium dollars on policies that renew as a result of the change in risk of the policy. 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. 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. CNA uses underwriting gain (loss), calculated using GAAP financial results, to monitor insurance operations. Underwriting gain (loss) is pretax and is calculated as net earned premiums less total insurance expenses, which includes insurance claims and policyholders’ benefits, amortization of deferred acquisition costs and other insurance related expenses. Underlying underwriting gain (loss) represents underwriting results excluding catastrophe losses and development-related items.

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The following tables summarize the results of CNA’s Property & Casualty Operations for the three and six months ended June 30, 2023 and 2022.

Three Months Ended June 30, 2023			Specialty						Commercial						International						Total
(In millions, except %)
Gross written premiums			$	1,769					$	1,719					$	421					$	3,909
Gross written premiums excluding third-party captives			961						1,604						421						2,986
Net written premiums			825						1,329						359						2,513
Net earned premiums			812						1,120						302						2,234
Underwriting gain			74						42						22						138
Net investment income			142						165						25						332
Core income			177						159						38						374
Other performance metrics:
Loss ratio excluding catastrophes and development			58.6		%				61.5		%				57.9		%				59.9		%
Effect of catastrophe impacts									5.2						3.1						3.1
Effect of development-related items			(0.3)						(0.5)												(0.4)
Loss ratio			58.3		%				66.2		%				61.0		%				62.6		%
Expense ratio			32.4						29.6						31.2						30.9
Dividend ratio			0.2						0.5												0.3
Combined ratio			90.9		%				96.3		%				92.2		%				93.8		%
Combined ratio excluding catastrophes and development			91.2		%				91.6		%				89.1		%				91.1		%
Rate			(1)%						8		%				4		%				5		%
Renewal premium change									11						7						7
Retention			89						85						83						86
New business			$	120					$	343					$	92					$	555

Three Months Ended June 30, 2022
Gross written premiums			$	1,904					$	1,429					$	382					$	3,715
Gross written premiums excluding third-party captives			973						1,321						382						2,676
Net written premiums			832						1,134						330						2,296
Net earned premiums			794						974						269						2,037
Underwriting gain			93						69						23						185
Net investment income			100						113						14						227
Core income			161						138						18						317
Other performance metrics:
Loss ratio excluding catastrophes and development			58.6		%				61.5		%				58.5		%				60.0		%
Effect of catastrophe impacts			0.1						3.0						2.8						1.8
Effect of development-related items			(1.2)						(1.8)						(1.8)						(1.6)
Loss ratio			57.5		%				62.7		%				59.5		%				60.2		%
Expense ratio			30.4						30.0						32.1						30.5
Dividend ratio			0.2						0.5												0.3
Combined ratio			88.1		%				93.2		%				91.6		%				91.0		%
Combined ratio excluding catastrophes and development			89.2		%				92.0		%				90.6		%				90.8		%
Rate			7		%				5		%				6		%				6		%
Renewal premium change			9						7						10						8
Retention			85						87						84						86
New business			$	132					$	280					$	88					$	500

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Six Months Ended June 30, 2023			Specialty						Commercial						International						Total
(In millions, except %)
Gross written premiums			$	3,549					$	3,161					$	819					$	7,529
Gross written premiums excluding third-party captives			1,847						3,044						819						5,710
Net written premiums			1,613						2,517						630						4,760
Net earned premiums			1,609						2,166						592						4,367
Underwriting gain			154						83						31						268
Net investment income			271						314						48						633
Core income			348						310						62						720
Other performance metrics:
Loss ratio excluding catastrophes and development			58.5		%				61.5		%				57.7		%				59.9		%
Effect of catastrophe impacts									4.7						2.9						2.7
Effect of development-related items			(0.2)						(0.3)						2.5						0.2
Loss ratio			58.3		%				65.9		%				63.1		%				62.8		%
Expense ratio			31.9						29.8						31.5						30.8
Dividend ratio			0.2						0.5												0.3
Combined ratio			90.4		%				96.2		%				94.6		%				93.9		%
Combined ratio excluding catastrophes and development			90.6		%				91.8		%				89.2		%				91.0		%
Rate									8		%				4		%				5		%
Renewal premium change			2		%				10						7						7
Retention			89						85						83						86
New business			$	228					$	653					$	177					$	1,058

Six Months Ended June 30, 2022
Gross written premiums			$	3,750					$	2,637					$	745					$	7,132
Gross written premiums excluding third-party captives			1,858						2,527						745						5,130
Net written premiums			1,603						2,135						581						4,319
Net earned premiums			1,566						1,878						533						3,977
Underwriting gain			181						117						43						341
Net investment income			203						231						28						462
Core income			324						270						44						638
Other performance metrics:
Loss ratio excluding catastrophes and development			58.7		%				61.5		%				58.6		%				60.0		%
Effect of catastrophe impacts			0.1						2.4						2.0						1.4
Effect of development-related items			(1.3)						(0.9)						(1.0)						(1.0)
Loss ratio			57.5		%				63.0		%				59.6		%				60.4		%
Expense ratio			30.7						30.3						32.4						30.7
Dividend ratio			0.2						0.5												0.3
Combined ratio			88.4		%				93.8		%				92.0		%				91.4		%
Combined ratio excluding catastrophes and development			89.6		%				92.3		%				91.0		%				91.0		%
Rate			8		%				5		%				8		%				6		%
Renewal premium change			9						8						10						9
Retention			85						86						79						84
New business			$	277					$	508					$	166					$	951

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Three Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Gross written premiums, excluding third-party captives, for Specialty decreased $12 million for the three months ended June 30, 2023 as compared with the comparable 2022 period driven by lower new business and rate. Net written premiums for Specialty decreased $7 million for the three months ended June 30, 2023 as compared with the comparable 2022 period. The increase in net earned premiums for the three months ended June 30, 2023 was consistent with the trend in net written premiums in recent quarters for Specialty.

Gross written premiums for Commercial increased $290 million for the three months ended June 30, 2023 as compared with the comparable 2022 period driven by favorable renewal premium change and higher new business. Net written premiums for Commercial increased $195 million for the three months ended June 30, 2023 as compared with the comparable 2022 period. The increase in net earned premiums for the three months ended June 30, 2023 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $39 million, or $44 million excluding the effect of foreign currency exchange rates, for the three months ended June 30, 2023 as compared with the comparable 2022 period driven by favorable renewal premium change. Net written premiums for International increased $29 million, or $31 million excluding the effect of foreign currency exchange rates, for the three months ended June 30, 2023 as compared with the comparable 2022 period. The increase in net earned premiums for the three months ended June 30, 2023 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $57 million for the three months ended June 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income and improved underlying underwriting results, partially offset by higher catastrophe losses and lower favorable net prior year loss reserve development.

Total catastrophe losses for Property & Casualty Operations were $68 million for the three months ended June 30, 2023 as compared with $37 million for the comparable 2022 period. For the three months ended June 30, 2023 and 2022, Specialty had no catastrophe losses and catastrophe losses of $1 million, Commercial had catastrophe losses of $59 million and $29 million and International had catastrophe losses of $9 million and $7 million.

Favorable net prior year loss reserve development for Property & Casualty Operations of $17 million and $37 million was recorded for the three months ended June 30, 2023 and 2022. For the three months ended June 30, 2023 and 2022, Specialty recorded favorable net prior year loss reserve development of $4 million and $10 million, Commercial recorded favorable net prior year loss reserve development of $13 million and $22 million and International recorded no net prior year loss reserve development and favorable net prior year loss reserve development of $5 million. Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 2.8 points for the three months ended June 30, 2023 as compared with the comparable 2022 period due to a 2.0 point increase in the expense ratio and a 0.8 point increase in the loss ratio. The increase in the expense ratio was primarily driven by higher employee related and acquisition costs. The increase in the loss ratio was primarily driven by lower favorable net prior year loss reserve development.

Commercial’s combined ratio increased 3.1 points for the three months ended June 30, 2023 as compared with the comparable 2022 period due to a 3.5 point increase in the loss ratio, partially offset by a 0.4 point improvement in the expense ratio. The increase in the loss ratio was driven by higher catastrophe losses, which were 5.2 points of the loss ratio for the three months ended June 30, 2023, as compared with 3.0 points of the loss ratio in the comparable 2022 period, and lower favorable net prior year loss reserve development. The improvement in the expense ratio was driven by higher net earned premiums, partially offset by higher employee related costs.

International’s combined ratio increased 0.6 points for the three months ended June 30, 2023 as compared with the comparable 2022 period due to a 1.5 point increase in the loss ratio, partially offset by a 0.9 point improvement in the expense ratio. The increase in the loss ratio was driven by no net prior period loss reserve development recorded for the three months ended June 30, 2023 as compared with $5 million of favorable net prior year loss reserve in the comparable 2022 period. Catastrophe losses were 3.1 points of the loss ratio for the three months ended June 30, 2023, as compared with 2.8 points of the loss ratio in the comparable 2022 period. The improvement in the expense ratio was primarily driven by higher net earned premiums and lower acquisition costs partially offset by higher employee related costs.

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Six Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Gross written premiums, excluding third-party captives, for Specialty decreased $11 million for the six months ended June 30, 2023 as compared with the comparable 2022 period driven by lower new business and rate. Net written premiums for Specialty increased $10 million for the six months ended June 30, 2023 as compared with the comparable 2022 period. The increase in net earned premiums for the six months ended June 30, 2023 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $524 million for the six months ended June 30, 2023 as compared with the comparable 2022 period driven by favorable renewal premium change and higher new business. Net written premiums for Commercial increased $382 million for the six months ended June 30, 2023 as compared with the comparable 2022 period. The increase in net earned premiums for the six months ended June 30, 2023 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $74 million for the six months ended June 30, 2023 as compared with the comparable 2022 period. Excluding the effect of foreign currency exchange rates, gross written premiums increased $99 million driven by favorable renewal premium change. Net written premiums for International increased $49 million for the six months ended June 30, 2023 as compared with the comparable 2022 period. Excluding the effect of foreign currency exchange rates, net written premiums increased $66 million for the six months ended June 30, 2023 as compared with the comparable 2022 period. The increase in net earned premiums for the six months ended June 30, 2023 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $82 million for the six months ended June 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income and improved underlying underwriting results, partially offset by higher catastrophe losses and lower favorable net prior year loss reserve development.

Total catastrophe losses for Property & Casualty Operations were $120 million for the six months ended June 30, 2023 as compared with $57 million for the comparable 2022 period. For the six months ended June 30, 2023 and 2022, Specialty had no catastrophe losses and catastrophe losses of $1 million, Commercial had catastrophe losses of $103 million and $45 million and International had catastrophe losses of $17 million and $11 million.

Favorable net prior year loss reserve development for Property & Casualty Operations of $4 million and $49 million was recorded for the six months ended June 30, 2023 and 2022. For the six months ended June 30, 2023 and 2022, Specialty recorded favorable net prior year loss reserve development of $4 million and $20 million, Commercial recorded favorable net prior year loss reserve development of $15 million and $24 million and International recorded unfavorable net prior year loss reserve development of $15 million and favorable net prior year loss reserve development of $5 million. Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 2.0 points for the six months ended June 30, 2023 as compared with the comparable 2022 period due to a 1.2 point increase in the expense ratio and a 0.8 point increase in the loss ratio. The increase in the expense ratio was primarily driven by higher employee related costs. The increase in the loss ratio was primarily driven by lower favorable net prior year loss reserve development.

Commercial’s combined ratio increased 2.4 points for the six months ended June 30, 2023 as compared with the comparable 2022 period due to a 2.9 point increase in the loss ratio, partially offset by a 0.5 point improvement in the expense ratio. The increase in the loss ratio was driven by higher catastrophe losses, which were 4.7 points of the loss ratio for the six months ended June 30, 2023, as compared with 2.4 points of the loss ratio in the comparable 2022 period, and lower favorable net prior year loss reserve development. The improvement in the expense ratio was driven by higher net earned premiums, partially offset by higher employee related costs.

International’s combined ratio increased 2.6 points for the six months ended June 30, 2023 as compared with the comparable 2022 period due to a 3.5 point increase in the loss ratio, partially offset by a 0.9 point improvement in the expense ratio. The increase in the loss ratio was driven by unfavorable net prior period loss reserve development and higher catastrophe losses. Catastrophe losses were 2.9 points of the loss ratio for the six months ended June 30, 2023, as compared with 2.0 points of the loss ratio in the comparable 2022 period. The improvement in the expense ratio was driven by higher net earned premiums.

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Other Insurance Operations

The following table summarizes the results of CNA’s Other Insurance Operations for the three and six months ended June 30, 2023 and 2022.

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Net earned premiums			$	113					$	118		$	228					$	238
Net investment income			243						205			467						418
Core loss (a)			(66)						(87)			(87)						(110)

(a)			As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021. Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance. Core loss for Other Insurance Operations for the three and six months ended June 30, 2022 was adjusted by $(15) million and $(33) million as a result of adopting the standard. For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Core results for Other Insurance Operations improved $21 million for the three months ended June 30, 2023 as compared with the comparable 2022 period primarily driven by lower net prior year loss reserve development and higher net investment income, partially offset by long term care policy buyouts. Policy buyouts generally result in an unfavorable impact on core loss, as the cash payments are linked to higher statutory reserve levels. Core loss for the three months ended June 30, 2023 includes a $28 million charge related to unfavorable net prior year loss reserve development largely associated with legacy mass tort claims as compared with a $51 million charge related to unfavorable net prior year loss reserve development for the comparable 2022 period. Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Six Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Core results for Other Insurance Operations improved $23 million for the six months ended June 30, 2023 as compared with the comparable 2022 period primarily driven by lower net prior year loss reserve development associated with legacy mass tort claims and higher net investment income, partially offset by long term care policy buyouts. Excluding the impacts of long term care policy buyouts, underwriting results are generally in line with expectations. CNA expects to continue offering policy buyouts for the remainder of 2023 and into future years. Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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Non-GAAP Reconciliation of Net Income Attributable to Loews Corporation to Core Income

The following table reconciles net income attributable to Loews Corporation to core income for the three and six months ended June 30, 2023 and 2022:

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Net income attributable to Loews Corporation (a)			$	255					$	170		$	523					$	435
Investment losses			25						40			53						43
Consolidating adjustments including noncontrolling interests (a)			28						20			57						50
Total core income			$	308					$	230		$	633					$	528
Core income (loss):
Property & Casualty Operations			$	374					$	317		$	720					$	638
Other Insurance Operations (a)			(66)						(87)			(87)						(110)
Total core income			$	308					$	230		$	633					$	528

(a)			As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021. Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance. Core loss for Other Insurance Operations for the three and six months ended June 30, 2022 was adjusted by $(15) million and $(33) million as a result of adopting the standard. For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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, 2022. 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”) and Boardwalk Pipelines’ efforts to monitor, control and reduce emissions, 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, 2022.

The following table summarizes the results of operations for Boardwalk Pipelines for the three and six months ended June 30, 2023 and 2022, as presented in Note 13 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report. Boardwalk Pipelines also utilizes a non-GAAP measure, earnings before interest, income tax expense, depreciation and amortization (“EBITDA”) 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.

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			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Revenues:
Operating revenues and other			$	361					$	325		$	756					$	706
Interest income			4									6
Total			365						325			762						706
Expenses:
Operating and other:
Operating costs and expenses			148						132			289						254
Depreciation and amortization			102						99			203						194
Interest			39						42			78						84
Total			289						273			570						532
Income before income tax			76						52			192						174
Income tax expense			(19)						(13)			(49)						(44)
Net income attributable to Loews Corporation			$	57					$	39		$	143					$	130
EBITDA			$	213					$	193		$	467					$	452

Three Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation and EBITDA increased $18 million and $20 million for the three months ended June 30, 2023 as compared with the comparable 2022 period.

Total revenues increased $40 million for the three months ended June 30, 2023 as compared with the comparable 2022 period, due to higher operating revenues. Including fuel and transportation expenses, operating revenues increased $39 million, primarily driven by an increase in transportation revenues of $27 million due to re-contracting at higher rates, higher utilization-based revenues and recently completed growth projects as well as a $10 million increase in storage and parking and lending revenues due to favorable market conditions.

Operating costs and expenses increased $16 million for the three months ended June 30, 2023 as compared with the comparable 2022 period. Excluding expenses offset with operating revenues, operating costs and expenses increased $19 million, primarily due to increased costs from maintenance projects associated with the requirements of the Mega Rule and higher employee-related and outside services costs.

Depreciation and amortization expenses increased $3 million for the three months ended June 30, 2023 as compared with the comparable 2022 period due to a change in the estimated life of certain assets.

Interest expenses decreased $3 million for the three months ended June 30, 2023 as compared with the comparable 2022 period, primarily due to lower average outstanding long-term debt.

Six Months Ended June 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation and EBITDA increased $13 million and $15 million for the six months ended June 30, 2023 as compared with the comparable 2022 period.

Total revenues increased $56 million for the six months ended June 30, 2023 as compared with the comparable 2022 period. This increase was primarily due to operating revenues, which increased $50 million, primarily driven by an increase in transportation revenues of $47 million due to re-contracting at higher rates and recently completed growth projects, as well as a $13 million increase in storage and parking and lending revenues due to favorable market conditions, partially offset by lower product sales of $8 million. In addition, interest income increased $6 million for the six months ended June 30, 2023 as compared with the comparable 2022 period.

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Operating costs and expenses increased $35 million for the six months ended June 30, 2023 as compared with the comparable 2022 period, primarily due to higher costs from increased maintenance projects associated with the requirements of the Mega Rule and higher employee-related, materials and supplies and outside services costs.

Depreciation and amortization expenses increased $9 million for the six months ended June 30, 2023 as compared with the comparable 2022 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expenses decreased $6 million for the six months ended June 30, 2023 as compared with the comparable 2022 period, primarily due to lower average outstanding long-term debt.

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

The following table reconciles net income attributable to Loews Corporation to EBITDA for the three and six months ended June 30, 2023 and 2022:

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Net income attributable to Loews Corporation			$	57					$	39		$	143					$	130
Interest			35						42			72						84
Income tax expense			19						13			49						44
Depreciation and amortization			102						99			203						194
EBITDA			$	213					$	193		$	467					$	452

Loews Hotels & Co

The following table summarizes the results of operations for Loews Hotels & Co for the three and six months ended June 30, 2023 and 2022, as presented in Note 13 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Revenues:
Operating revenue			$	182					$	168		$	337					$	291
Gain on acquisition of a joint venture			46									46
Revenues related to reimbursable expenses			26						32			63						61
Total			254						200			446						352
Expenses:
Operating and other:
Operating			142						123			272						231
Asset impairments			9						14			9						14
Reimbursable expenses			26						32			63						61
Depreciation and amortization expense			17						16			33						31
Equity income from joint ventures			(41)						(53)			(72)						(79)
Interest									4			6						8
Total			153						136			311						266
Income before income tax			101						64			135						86
Income tax expense			(27)						(20)			(37)						(27)
Net income attributable to Loews Corporation			$	74					$	44		$	98					$	59

Net income attributable to Loews Corporation increased by $30 million and $39 million for the three and six months ended June 30, 2023 as compared with the comparable 2022 periods primarily due to the reasons discussed below.

Operating revenues improved by $14 million and $46 million and operating expenses increased by $19 million and $41 million for the three and six months ended June 30, 2023 as compared with the comparable 2022 periods. The increase in operating revenues was driven by slightly higher occupancy levels at many owned hotels in 2023 as compared with the comparable 2022 periods along with consolidating the results of a property in the three months ended June 30, 2023 that was previously accounted for under the equity method. Occupancy levels in the first quarter of 2022 were negatively impacted by COVID variants and experienced improvement in the first quarter of 2023. The increase in operating expenses was largely due to increased staffing costs.

During the second quarter of 2023, Loews Hotels & Co recorded a gain of $46 million ($36 million after tax) related to the acquisition of an additional equity interest and consolidation of a previously unconsolidated joint venture property.

Equity income from joint ventures decreased $12 million and $7 million for the three and six months ended June 30, 2023 as compared with the comparable 2022 periods. Occupancy levels at joint venture properties decreased slightly in the second quarter of 2023 compared to the comparable prior year period while average daily rates increased nominally. In addition, occupancy levels in the first quarter of 2022 were negatively impacted by COVID variants and experienced improvement in the first quarter of 2023. Expenses at joint venture properties have increased in 2023 compared to 2022, largely due to increased staffing costs and higher interest costs.

The three and six months ended June 30, 2023 and 2022 include impairment charges of $9 million and $14 million to reduce the carrying value of assets to their estimated fair value.

Interest expense decreased $4 million and $2 million for the three and six months ended June 30, 2023 as compared with the comparable 2022 periods due primarily to the increase in capitalized interest on projects under development and the favorable impact of interest rate caps.

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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 equity method of accounting for Altium Packaging.

The following table summarizes the results of operations for Corporate for the three and six months ended June 30, 2023 and 2022 as presented in Note 13 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report:

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Revenues:
Net investment income (loss)			$	11					$	(65)		$	53					$	(81)
Operating revenues and other									2									2
Total			11						(63)			53						(79)
Expenses:
Operating and other			18						21			37						42
Equity method loss			2						2			5						3
Interest			21						22			43						44
Total			41						45			85						89
Loss before income tax			(30)						(108)			(32)						(168)
Income tax (expense) benefit			4						22			3						33
Net loss attributable to Loews Corporation			$	(26)					$	(86)		$	(29)					$	(135)

Net investment income for the Parent Company was $11 million and $53 million for the three and six months ended June 30, 2023 as compared with net investment losses of $65 million and $81 million in the comparable 2022 periods, primarily due to improved results from short term investments and the favorable change in the fair value of equity based investments in the trading portfolio.

The Company expects to record approximately $50 million in Operating and other expenses in the second half of 2023 to recognize unrealized losses which are included in AOCI due to the planned termination of a non-contributory defined benefit plan.

LIQUIDITY AND CAPITAL RESOURCES

Parent Company

Parent Company cash and investments, net of receivables and payables, totaled $2.5 billion at June 30, 2023 as compared to $3.2 billion at December 31, 2022. During the six months ended June 30, 2023, we received $498 million in cash dividends from CNA, including a special cash dividend of $293 million. Cash outflows during the six months ended June 30, 2023 included the payment of $593 million to fund treasury stock purchases, $500 million to retire at maturity the outstanding aggregate principal amount of our 2.6% senior notes, $29 million of cash dividends to our shareholders, $3 million to purchase common shares of CNA and an equity contribution of $30 million to Loews Hotels & Co. 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”) under which we may publicly issue 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 shares of our and our subsidiaries outstanding common stock in the open market, in privately negotiated transactions or otherwise. During the six months ended June 30, 2023, we

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purchased 10.0 million shares of Loews Corporation common stock and 0.1 million shares of CNA’s common stock. As of July 28, 2023, there were 225,508,650 shares of Loews Corporation common stock outstanding.

Future uses of our cash may include investing in our subsidiaries, new acquisitions, dividends and/or purchases 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 $937 million for the six months ended June 30, 2023 and $1.3 billion for the comparable 2022 period. The decrease in cash provided by operating activities was driven by higher net claim payments, which includes long term care policy buyouts, and lower distributions from limited partnerships, partially offset by an increase in premiums collected.

CNA paid cash dividends of $2.04 per share on its common stock, including a special cash dividend of $1.20 per share, during the six months ended June 30, 2023. On July 28, 2023, CNA’s Board of Directors declared a quarterly cash dividend of $0.42 per share payable August 31, 2023 to shareholders of record on August 14, 2023. 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 June 30, 2023, CCC was in a positive earned surplus position. CCC paid dividends of $660 million and $690 million during the six months ended June 30, 2023 and 2022. 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.

In May of 2023, CNA completed a public offering of $400 million aggregate principal amount of its 5.5% senior notes due June 15, 2033.

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 $31 million for the six months ended June 30, 2023 as compared with the comparable 2022 period, primarily due to changes in net income adjusted for depreciation and amortization and other non-cash operating activities and the impacts of lower natural gas prices on Boardwalk Pipelines’ imbalance activities.

For the six months ended June 30, 2023 and 2022, Boardwalk Pipelines’ capital expenditures were $151 million and $122 million, consisting of growth capital expenditures of $95 million and $76 million and maintenance capital expenditures of $56 million and $39 million. During the six months ended June 30, 2022, Boardwalk Pipelines also spent $7 million on natural gas to be used in its integrated natural gas pipeline system.

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 2023. Boardwalk Pipelines also has an effective shelf registration statement on file with the SEC under which it has $500 million of remaining capacity available to publicly issue debt securities, warrants or rights. As of June 30, 2023, Boardwalk Pipelines had available the entire $1.0 billion of borrowing capacity under its revolving credit facility. In June of 2023, Boardwalk Pipelines’ amended its revolving credit facility to extend the maturity date by one year to May 26, 2028. For further information, see Note 8 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

As of June 30, 2023, Loews Hotels & Co, through its subsidiaries, had $164 million in mortgage loans that mature within twelve months. Each loan has an extension option which Loews Hotels & Co currently plans to exercise before maturity. Extending any indebtedness, including loans of unconsolidated joint venture partnerships, may require Loews Hotels & Co

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to make principal pay downs, establish restricted cash reserves or provide guaranties of the subsidiary’s debt. Through the date of this Report, all Loews Hotels & Co’s subsidiaries are in compliance with their debt covenants.

Through July 28, 2023, Loews Hotels & Co received capital contributions of $30 million from Loews Corporation to fund development projects during 2023.

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. 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 future movements in the underlying markets. If such movements do not occur as anticipated, 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									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Fixed income securities:
Taxable fixed income securities			$	444					$	385		$	874					$	753
Tax-exempt fixed income securities			46						66			95						139
Total fixed income securities			490						451			969						892
Limited partnership and common stock investments			68						(15)			96						(7)
Other, net of investment expense			17						(4)			35						(5)
Net investment income			$	575					$	432		$	1,100					$	880

Effective income yield for the fixed income securities portfolio			4.6		%				4.3		%	4.6		%				4.3		%
Limited partnership and common stock return			3.1		%				(0.7)		%	4.5		%				(0.3)		%

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CNA’s net investment income increased $143 million and $220 million for the three and six months ended June 30, 2023 as compared with the comparable 2022 periods, driven by higher limited partnership and common stock returns and higher income from fixed income securities and other.

Investment Gains (Losses)

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

			Three Months Ended									Six Months Ended
			June 30,									June 30,
			2023						2022			2023						2022
(In millions)
Investment gains (losses):
Fixed maturity securities:
Corporate and other bonds			$	(12)					$	(30)		$	(35)					$	(27)
States, municipalities and political subdivisions			(3)						19			7						22
Asset-backed			(12)						(4)			(21)						(12)
Total fixed maturity securities			(27)						(15)			(49)						(17)
Non-redeemable preferred stock			3						(71)			(11)						(109)
Derivatives, short term and other			(8)						27			(7)						56
Total investment losses			(32)						(59)			(67)						(70)
Income tax benefit			7						19			14						27
Amounts attributable to noncontrolling interests			2						4			5						4
Investment losses attributable to Loews Corporation			$	(23)					$	(36)		$	(48)					$	(39)

CNA’s pretax investment results improved $27 million and $3 million for the three and six months ended June 30, 2023 as compared with the comparable 2022 periods, driven by the favorable relative change in fair value of non-redeemable preferred stock in the three and six months ended June 30, 2023 as compared to the comparable 2022 periods, partially offset by higher net losses on disposals of fixed maturity securities. The three and six months ended June 30, 2022 also included gains on a funds withheld embedded derivative which related to a coinsurance agreement on CNA’s legacy annuity business that was novated in the fourth quarter of 2022.

Further information on CNA’s investment gains and losses is set forth in Note 3 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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			June 30, 2023												December 31, 2022
			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			$	2,530					$	(333)					$	2,419					$	(336)
AAA			2,492						(205)						2,398						(208)
AA			6,385						(588)						6,342						(663)
A			9,579						(463)						9,043						(531)
BBB			16,061						(1,310)						15,651						(1,447)
Non-investment grade			1,681						(189)						1,774						(219)
Total			$	38,728					$	(3,088)					$	37,627					$	(3,404)

As of June 30, 2023 and December 31, 2022, 1% of CNA’s fixed maturity portfolio was rated internally. AAA rated securities included $0.3 billion of pre-funded municipal bonds as of June 30, 2023 and December 31, 2022.

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

June 30, 2023			Estimated Fair Value						Gross Unrealized Losses
(In millions)
U.S. Government, Government agencies and Government-sponsored enterprises			$	2,479					$	334
AAA			1,662						283
AA			4,404						746
A			6,937						703
BBB			12,960						1,513
Non-investment grade			1,170						207
Total			$	29,612					$	3,786

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:

June 30, 2023			Estimated Fair Value						Gross Unrealized Losses
(In millions)
Due in one year or less			$	841					$	20
Due after one year through five years			8,895						669
Due after five years through ten years			9,866						1,397
Due after ten years			10,010						1,700
Total			$	29,612					$	3,786

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Commercial Real Estate

CNA’s investment portfolio has exposure to the commercial real estate sector primarily through its fixed maturity securities and mortgage loan portfolios. The performance of these assets is dependent on a number of factors, including the performance of the underlying collateral (which is influenced by cash flows from underlying property leases), changes in the fair value of collateral, refinancing risk, and the creditworthiness of tenants of credit tenant loan properties (where lease payments directly service the loan).

Within CNA’s fixed maturity securities portfolio, its exposure is primarily through the commercial mortgage-backed securities portfolio and the corporate and other bonds portfolio, which contains obligations of real estate investment trust (“REIT”) issuers. Commercial mortgage-backed securities include both single asset, single borrower collateral that is securitized independently and conduit collateral that is securitized in diversified pools.

The following tables present the estimated fair value and net unrealized gains (losses) of CNA’s commercial mortgage-backed securities by property type and by ratings distribution:

June 30, 2023			Estimated Fair Value						Net Unrealized Gains (Losses)
(In millions)
Commercial mortgage-backed:
Single asset, single borrower:
Office			$	289					$	(77)
Retail			278						(38)
Lodging			218						(20)
Industrial			90						(6)
Multifamily			51						(4)
Total single asset, single borrower			926						(145)
Conduits (multi property, multi borrower pools)			657						(108)
Total commercial mortgage-backed			$	1,583					$	(253)

June 30, 2023			Estimated Fair Value						Net Unrealized Gains (Losses)
(In millions)
Commercial mortgage backed:
AAA			$	425					$	(35)
AA			620						(107)
A			209						(35)
BBB			256						(56)
Non-investment grade			73						(20)
Total commercial mortgage-backed			$	1,583					$	(253)

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The following tables present the estimated fair value and net unrealized gains (losses) of the REIT issuer exposure within CNA’s corporate and other bonds portfolio by property type and by ratings distribution:

June 30, 2023			Estimated Fair Value						Net Unrealized Gains (Losses)
(In millions)
Corporate and other bonds - REITs:
Retail			$	455					$	(48)
Office			255						(30)
Industrial			86						(5)
Other (a)			416						(39)
Total corporate and other bonds - REITs			$	1,212					$	(122)

(a)			Other includes a diversified mix of property type strategies including self-storage, healthcare and apartments.

June 30, 2023			Estimated Fair Value						Net Unrealized Gains (Losses)
(In millions)
Corporate and other bonds - REITs:
AA			$	11					$	(1)
A			249						(13)
BBB			936						(106)
Non-investment grade			16						(2)
Total corporate and other bonds - REITs			$	1,212					$	(122)

Mortgage loans are commercial in nature and are carried at unpaid principal balance, net of unamortized fees and an allowance for expected credit losses. The allowance for expected credit losses is developed by assessing the credit quality of pools of mortgage loans in good standing using debt service coverage ratios (“DSCR”) and loan-to-value ratios (“LTV”). This assessment utilizes historical credit loss experience adjusted to reflect current conditions and reasonable and supportable forecasts. As of June 30, 2023 the allowance for expected credit losses on CNA’s mortgage portfolio was $30 million, or 2.9% of its amortized cost basis.

The following table presents the amortized cost basis of mortgage loans by property type:

June 30, 2023			Amortized Cost						Percentage of Total
(In millions, except %)
Mortgage loans:
Retail			$	470					44		%
Office			255						25
Industrial			131						13
Other			183						18
Total mortgage loans			1,039						100		%
Less: Allowance for expected credit losses			(30)
Total mortgage loans - net of allowance			$	1,009

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In addition to the mortgage loan portfolio, CNA invests in securitized credit tenant loans and ground lease financings that are classified as fixed maturity securities, all of which are investment grade quality. As of June 30, 2023, these holdings had an estimated fair value of $474 million and net unrealized losses of $92 million.

CNA owns other fixed maturity securities which have exposure to cell towers, data centers and other collateral types that could be viewed as having real estate characteristics. CNA views these securities to have risks more similar to operating enterprises that do not share the same risks as the broader commercial real estate market.

CNA does not hold any direct investments in commercial real estate. Additionally, CNA does not have significant exposure through its limited partnership portfolio to funds whose primary strategy is real estate focused.

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.

			June 30, 2023												December 31, 2022
			Estimated Fair Value						Effective Duration (Years)						Estimated Fair Value						Effective Duration (Years)
(In millions of dollars)
Investments supporting Other Insurance Operations			$	14,691					9.9						$	14,511					9.9
Other investments			26,480						4.6						25,445						4.7
Total			$	41,171					6.5						$	39,956					6.6

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, 2022.

CATASTROPHES AND RELATED REINSURANCE

Various events can cause catastrophe losses. These events can be natural or man-made, including hurricanes, tornadoes, windstorms, earthquakes, hail, severe winter weather, fires, floods, riots, strikes, civil unrest, cyber attacks, pandemics and acts of terrorism that produce unusually large aggregate losses.

Catastrophes are an inherent risk of the property and casualty insurance business and have contributed to material period-to-period fluctuations in CNA’s results of operations and/or equity. CNA uses various analyses and methods, including using one of the industry standard natural catastrophe models to estimate hurricane and earthquake losses at various return periods, to inform underwriting and reinsurance decisions designed to manage its exposure to catastrophic events. CNA generally seeks to manage its exposure through the purchase of catastrophe reinsurance and utilizes various reinsurance

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programs to mitigate catastrophe losses including excess-of-loss occurrence and aggregate treaties covering property and workers’ compensation, a property quota share treaty and the Terrorism Risk Insurance Program Reauthorization Act of 2019 (“TRIPRA”), as well as individual risk agreements that reinsure from losses from specific classes or lines of business. CNA conducts an ongoing review of its risk and catastrophe reinsurance coverages and from time to time makes changes as it deems appropriate. In the second quarter of 2023, CNA renewed its excess-of-loss property catastrophe reinsurance as described below.

Group North American Property Treaty

CNA purchased corporate catastrophe excess-of-loss treaty reinsurance covering its U.S. states and territories and Canadian property exposures underwritten in its North American and European companies. Exposures underwritten through Hardy are excluded and covered under a separate treaty. The treaty has a term of June 1, 2023 to June 1, 2024 and provides coverage for the accumulation of covered losses from catastrophe occurrences above CNA’s per occurrence retention of $235 million up to $1.1 billion for all losses other than earthquakes. Earthquakes are covered up to $1.2 billion. Losses stemming from terrorism events are covered unless they are due to a nuclear, biological or chemical attack. All layers of the treaty provide for one full reinstatement.

Group Workers’ Compensation Treaty

CNA also purchased corporate Workers’ Compensation catastrophe excess-of-loss treaty reinsurance for the period January 1, 2023 to January 1, 2024 providing $275 million of coverage for the accumulation of covered losses related to natural catastrophes above CNA’s per occurrence retention of $25 million. The treaty also provides $600 million of coverage for the accumulation of covered losses related to terrorism events above CNA’s per occurrence retention of $25 million. Of this $600 million in Terrorism coverage, $200 million is provided for nuclear, biological, chemical and radiation events. One full reinstatement is available for the first $275 million above the retention, regardless of the covered peril.

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 for accounting estimates related to Reinsurance and Insurance Receivables, Valuation of Investments and Impairment of Securities, and the Insurance Reserves sections of our MD&A in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022 for further information.

The information presented below restates in their entirety, as a result of the adoption of ASU 2018-12 and its impact on long term care reserves, the accounting estimates related to Insurance Reserves and Long Term Care Reserves included in the Critical Accounting Estimates section of our MD&A in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022. Further information on the long term care reserving process under the new guidance is included in Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Insurance Reserves

Insurance reserves are established for both short and long-duration insurance contracts. Short-duration contracts are primarily related to property and casualty insurance policies where the reserving process is based on actuarial estimates of the amount of loss, including amounts for known and unknown claims. Long-duration contracts are primarily related to long term care policies and the reserves are recorded as Future policy benefits reserves as discussed below. The reserve for unearned premiums represents the portion of premiums written related to the unexpired terms of coverage. The reserving process is discussed in further detail in the Insurance Reserves section of our MD&A in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022.

Long Term Care Reserves

Future policy benefits reserves for long term care policies are based on certain assumptions, including morbidity, persistency (inclusive of mortality), future premium rate increases and expenses. The adequacy of the reserves is contingent upon actual experience and future expectations related to these key assumptions. If actual or expected future experience differs from these assumptions, the reserves may not be adequate, requiring an increase to reserves. The reserves are

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discounted using upper-medium grade fixed income instrument yields as of each reporting date. In addition, regulatory approval may not be received for the level of premium rate increases requested.

Changes to reserves could materially adversely impact our results of operations, financial condition and equity.

ACCOUNTING STANDARDS UPDATE

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-12. 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 business in Other Insurance Operations.

Prior period amounts in the financial statements have been adjusted to reflect application of ASU 2018-12. Net income attributable to Loews Corporation for the third quarter of 2022 decreased $152 million from what was previously reported under legacy accounting guidance, primarily related to CNA’s third quarter 2022 annual review of cash flow reserving assumptions. Under legacy accounting guidance, the third quarter 2022 gross premium valuation assessment indicated a pretax margin of $125 million and no unlocking event occurred. Under the new guidance favorable changes to the upper-medium grade fixed income instrument discount rate were recorded through Accumulated other comprehensive income quarterly, while the net unfavorable impact of increased cost of care inflation offset by favorable premium rate action assumptions was recorded in income. Excluding the third quarter of 2022, net income attributable to Loews Corporation did not change materially from what was reported prior to adoption of ASU 2018-12.

For a discussion of accounting standards updates that have been adopted, 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, 2022 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.