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CNA Financial CFO attributes sizable reserve releases to 'consistency of improvement'

Written by Jasir Jawaid

CNA Financial Corp. saw favorable reserve development in the third quarter following reserve studies the company conducts in the normal course of business, CFO Donald Mense said on a Nov. 2 earnings conference call.

For its P&C operations, the company reported that the combined ratio benefited from 10.7 percentage points of reserve development, coming in at 85.7% for the quarter versus 96.1% a year ago. Excluding the impact of catastrophes and reserve development, the combined ratio stood at 95.5%. In the specialty segment, the combined ratio improved to 74.4% from 80.8% thanks to 18.6 points of reserve development. The commercial segment saw combined ratio of 95.8% compared to 110.7% in the 2014 third quarter. The international segment saw 15.9 percentage point of reserve development in the quarter, resulting in a combined ratio of 90.4%.

"We had no asterisks from any business that we looked at," Mense said during the call's question-and-answer session.

In the specialty arm, CNA saw positive results in surety and the professional and management liability book. The company did not have "bad news" in the commercial segment and the international arm performed well too, he said.

"So, just really [it was] consistency of improvement across everywhere," Mense concluded.

This article was published by S&P Global Market Intelligence on the S&P Capital IQ Pro platform.


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