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CNA Financial Corp. on Monday reported $387 million in net income for the fourth quarter of 2020, a nearly 30% increase from the year-earlier period, citing improved underwriting results, a low catastrophe quarter and strong investment performance.
The Chicago-based insurer’s full-year net income, however, fell to $690 million, from $1 billion in 2019.
“The shortfall from the prior year was primarily attributed to the impact of the elevated pre-tax catastrophe losses of $550 million, which included our reserve charge for the pandemic of $195 million … as compared to $179 million of catastrophe losses in 2019,” said Dino Robusto, chairman and CEO, said an earnings call.
In its property/casualty operations, the insurer reported $1.95 billion in net written premiums in the fourth quarter of 2020, a 12% increase over the same period in 2019. The combined ratio for P/C for the quarter was 93.5%, a 2.1 point improvement.
Full-year net written premiums increased to $7.57 billion from $7.13 billion in 2019, and the insurer “achieved rate increases of 11% for the full year, more than double our 2019 rate increases, and new business was up 6% for the year,” Mr. Robusto said.
However, the combined ratio for P/C for 2020 was 100.9%, a deterioration from 96.7% in 2019, due to catastrophe losses.
In the specialty segment, the insurer reported net written premiums of $809 million for the fourth quarter, a 15% improvement over the fourth quarter of 2019. The combined ratio was 89.4%, a slight decline from 88.2% for the last quarter of 2019. The segment’s full-year net written premiums improved to $3.04 billion in 2020, compared with $2.85 billion in 2019.
In the commercial segment, CNA’s net written premiums for the fourth quarter totaled $862 million, an 11% increase over the same quarter in 2019, and the combined ratio in the segment improved to 96.2%, from 100.6%. Full-year net written premiums in commercial improved 8% to $3.57 billion in 2020, but the combined ratio worsened to 106.9%, from 100.8% in 2019.
The insurer will “continue to leverage this hardening market to build margin,” Mr. Robusto said.
“As I have said before, we are going to continue to be prudent on how we act on any margins due to the global pandemic’s disruptive impact obfuscating claims trends,” he said.
More insurance and workers compensation news on the coronavirus crisis here.
CNA Financial Corp. on Monday reported a net loss of $61 million in the first quarter of 2020 compared with a $342 million profit in the same quarter of last year as coronavirus-related market turmoil hit the insurer’s investments.