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Sep 30, 2022
Cincinnati Financial Q3 2022 Earnings Report
Cincinnati Financial reported a net loss due to a reduction in the fair value of equity securities, while investment income continued to contribute to a positive operating profit.
Key Takeaways
Cincinnati Financial Corporation reported a net loss of $418 million for the third quarter of 2022, compared to a net income of $153 million in the same period last year. The decrease was primarily due to a $557 million after-tax reduction in the fair value of equity securities. Non-GAAP operating income also decreased by 45% to $114 million.
Third-quarter net loss was $418 million, or $2.64 per share, compared to net income of $153 million, or 94 cents per share, in the third quarter of 2021.
Non-GAAP operating income decreased by 45% to $114 million, or 73 cents per share.
Book value per share was $60.01 at September 30, 2022, down $21.71 since year-end.
The property casualty combined ratio increased to 103.9% for the third quarter of 2022, up from 92.6% in the third quarter of 2021.
Cincinnati Financial
Cincinnati Financial
Cincinnati Financial Revenue by Segment
Revenue by Segment
Commercial Lines Revenue
CapyFin.comPersonal Lines Revenue
CapyFin.comE&S Lines Revenue
CapyFin.com Forward Guidance
Cincinnati Financial's management expressed confidence in their ongoing ability to produce value for shareholders, citing their multi-pronged strategy and dedicated associates working with independent agents to grow the insurance business profitably.
Positive Outlook
- Talented and dedicated associates are working vigorously with the independent agents.
- Drive our multi-pronged strategy to continue growing our insurance business profitably.
- Sophisticated pricing models give us a robust view of the many factors impacting our business.
- Underwriters are focused on risk selection and pricing discipline for new or renewal business.
- Continued strong net written premium growth of 14% on both a quarterly and nine-month basis.
Challenges Ahead
- Company reported a net loss of $418 million for the third quarter of 2022.
- Losses from Hurricane Ian pushed our third-quarter combined ratio to 103.9%.
- Combined ratios before catastrophes rose compared to 2021’s excellent results.
- Personal auto is one line of business where we see the need for rate increases nearly across the board.
- Inflation levels our industry hasn’t experienced in decades, combined with increasingly distracted drivers, continue to push both severity and frequency of claims higher.
Revenue & Expenses
Visualization of income flow from segment revenue to net income