CNA expects underwriting loss as COVID-19 claims mount
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CNA Financial Corp. expects to report a $210 million underwriting loss when it publishes its second-quarter results next month, but a rebound in investment markets and other investment gains will keep the insurer in the black for the quarter, CNA said Wednesday.
CNA expects pretax second-quarter catastrophe losses of $301 million, based on $182 million in losses related to the COVID-19 pandemic, $61 million related to civil unrest, and $58 million from severe weather events.
The pandemic-related losses “are substantially driven by health care professional liability with additional impacts from workers compensation, management liability, commercial property, trade credit, and surety,” the insurer said in a statement.
In addition to catastrophe losses, CNA expects to recognize $50 million in unfavorable prior-year liability development, primarily due to New York’s reviver statute-related claims. In 2019, New York passed a law relaxing statute of limitations rules for child sexual abuse claims.
The insurer expects to post net income of $151 million for the second quarter, compared with $278 million for the same period in 2019.
The results will benefit from “the favorable impact from limited partnerships, common stock and nonredeemable preferred stock investments” and a rebound in equity markets, the statement said.
CNA is scheduled to publish its second-quarter results on Aug. 3.
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