COVID-19 significantly affected CNA Financial Corp.'s insurance results, resulting in net loss losses of $ 301 million in the second quarter, the Chicago-based insurer reported Monday.
CNA posted a net profit of $ 151 million, down nearly 46% from the second quarter of last year. However, the company saw a slightly lower loss rate due to restrictions on on-site protection, an uptick in the written contribution in the company's property / damages segment and stronger net investments.
"The second quarter has been a challenging one as the pandemic continues to affect us all," Dino Robusto, President and CEO, said in an earnings interview on Monday.
In mid-July, CNA predicted its underwriting performance in a statement and announced that its responsibilities in health care, as well as employee compensation, administrative responsibilities, commercial property, trade credit and security, had been hit hard by the pandemic.
The insurer received $ 1
The estimated figure for pandemic-related disaster losses "reflects our best estimate of the ultimate insurance losses, including expected legal costs," Robusto said.
CNA's forecasts also included workers' compensation legislation for COVID-19 and health care laws that have been enacted in some states, he said.
In addition to the pandemic-related effects, CNA experienced increasing difficulty developments in several product lines, including aging services and primary and surplus liability, Robusto said, but retention increased during the quarter.
The insurance company's property / damages the total ratio decreased to 112.3% during the second quarter compared to 95.7% during the same period last year. However, the CNA's P / C net premiums increased by 3% to $ 1.93 billion. The insurance company's net written premiums increased by 4% to $ 742 million in specialty and 4% to $ 949 million in commercial.
The specialty segment experienced net disaster losses of $ 105 million – almost all due to COVID-19 – compared to $ 1 million for the second quarter of 2019. Commercial experience of net disaster losses of $ 151 million, up from $ 37 million in the previous year.
CNA's net investment increased to $ 534 million, from $ 515 million in the second quarter of last year, which the insurer said reflected the recovery in the stock market during the quarter.
"I think the uncertainty surrounding COVID has just affected the overall perception that we will need a tougher market probably faster and longer," Robusto said. "The good news is that I am even more bullish that the hardening market conditions will last until 2021. The performance during the second quarter showed that we are well positioned to take full advantage of the hardening market."
More insurance and workers' compensation news about the coronavirus crisis here .