Cincinnati Financial Corporation has announced its financial results for the second quarter of 2024 reporting a net income of $312mn, 42% lower when compared to the $534mn reported in the same period last year.
The $222mn decrease in Q2 2024 net income was primarily due to the after-tax net effect of a $235 million decrease in net investment gains that was partially offset by a $17 million increase in after-tax investment income.
The insurer also reported that a $112mn second-quarter 2024 after-tax increase in the fair value of equity securities still held.
Non-GAAP operating income increased 7% in Q2 2024, to $204mn, compared with $191mn in Q2 203. The insurer also saw a 11% increase in earned premiums, to $2.15mn, in the same period, which compared to $1.9mn reported in last year’s second quarter.
Net written premiums also saw growth in this year’s second quarter, to $2.6mn from $2.1mn in Q2 2023. This growth includes price increases, premium growth initiatives and a higher level of insured exposures.
Cincinnati’s property casualty new business written premiums were $407mn in Q2 2024, up 34%. The insurer noted that agencies appointed since the beginning of 2023 contributed $33 million or 8% of total new business written premiums.
There were 177 new agency appointments in the first six months of 2024, including 60 that market only our personal lines products.
Property casualty combined ratio increased in the quarter to 98.5%, from 97.6% for the second quarter of 2023.
The insurer’s life insurance subsidiary saw a net income of $24mn in Q2 2024, up $3 million, and including a 26% increase in non-GAAP operating income compared with Q2 2023, and 2%, growth in Q2 2024 term life insurance earned premiums.
Stephen M. Spray, president and chief executive officer, commented: “Contributions from both our underwriting and investment operations helped us record strong non-GAAP operating income results, with year-over-year growth of 7% for the second quarter and 43% for the first six months of 2024. Notably, our life insurance subsidiary increased their contribution to non-GAAP operating income by 26% for the quarter.
“Turning to our property casualty insurance operations, our second-quarter combined ratio of 98.5% was up less than a point from last-year’s second quarter. On a six-month basis that ratio improved 3.1 points to 96.1%, compared to 99.2% for the same period of 2023.
“Current property casualty accident year results before catastrophe losses improving by 2.2 points for the quarter and 0.7 points for the first half give us even more reason for optimism as we look ahead to the end of the year.”
He added: “The confidence we have in our pricing segmentation and risk selection, as well as our strong relationships with our premier independent agents, supports our belief that we are responsibly balancing growth and profitability.
“Second-quarter property casualty new business written premiums topped $400 million for the first time in any single quarter, growing 34% compared with last year. Total property casualty net written premiums saw double-digit growth for the first six months, increasing 13% compared with the first half of 2023 as pricing increases, higher levels of insured exposures and agency appointments accelerate.
“Renewal pricing remained robust with commercial, personal and excess & surplus lines seeing average renewal pricing increases in the high-single-digit percent range.”
“Our diversification efforts also continue to contribute to the recent stability we’ve achieved in our operating performance. Cincinnati Global Underwriting Ltd.SM and Cincinnati Re® both delivered excellent second-quarter results with combined ratios of 63.2% and 70.1%, respectively.”
