CNA Q1 results hit by CAC divestment and cats
CNA Financial posted a vastly depleted net profit in its first quarter results largely on the back of an estimated after-tax impairment loss of $214 million relating to its sale of its run-off annuity and pension deposit business Continental Assurance Company (CAC).
The eighth largest commercial insurance writer in the US made a net profit of just $13 million in the quarter compared with $250 million the year before. Its net operating income for the period was $190 million, a 26 percent drop on the $257 million it made in the in the prior year quarter.
It said this decrease was due to lower net investment income, higher catastrophe losses and lower favourable net prior year development. After-tax catastrophe losses were $48 million for the quarter, primarily due to US winter weather-related events, as compared with $25 million for the same period in 2013. These unfavourable items were partially offset by improved non-catastrophe current accident year underwriting results.
Its combined ratio for its property & casualty operations for the first quarter was 101.6 percent almost identical to a year ago. Its net written premiums were also almost flat at $1.76 billion compared with $1.77 billion a year earlier.
“We continued to make steady improvements in our core businesses in the first quarter,” said Thomas Motamed, chairman and chief executive of CNA Financial. “We remain focused on the disciplined execution of our business strategy and are confident in our ultimate success.”
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