The total number of shares to be available under the 2016 Plan is 10 million shares of the company’s $2.00 par value common stock. Approximately 4 million of the originally authorized 7 million shares under the 2012 Plan and 500,000 of the originally authorized 10 million shares under the 2006 Plan remain available to grant to associates. The 2006 Plan is set to expire on May 5, 2016; however, any awards granted prior to that date may extend beyond it.

The board of directors wishes to continue extending equity ownership beyond the company’s executives to all levels of associates, potentially including hourly associates. To best serve shareholders for the long term, the board seeks to align the interests of associates with the interests of shareholders.

Historically, stock-based awards have translated into ownership as most associates generally hold their shares, funding the option purchases without cashing in a portion of the grant. The company’s associates have a direct stake in building future success for your company. Although the company does not have access to information about broker accounts, we estimate that approximately 80 percent of our associates hold shares of Cincinnati Financial Corporation.

We believe that, had the 2016 Plan been in effect in fiscal year 2015, the amount of awards granted under the 2016 Plan in 2015 would not have been materially different than the amounts granted under the existing 2012 and 2006 Plans, as displayed in the table below:

2016 Plan Description

The 2016 Plan provides for grants of various types of stock-based awards to associates of the company and its subsidiaries who are selected by the Committee of the board of directors. Awards in any form other than stock options would be counted against the 10 million share limit as three shares for every one share granted. The 2016 Plan is presented in Appendix B, beginning on Page 70.

The awards to be made in the future to participants will be decided at that time and cannot be determined at this time. The actual awards depend on a number of factors, including the company’s performance, an individual’s potential contribution to the business, compensation practices at the time, retention considerations and the company’s stock price.

Eligibility.All associates of the company and its subsidiaries are eligible to receive awards under the 2016 Plan. Approximately 4,500 associates currently would be eligible under the 2016 Plan.

Plan Administration. The 2016 Plan is an unfunded plan and will be administered by the Committee, which must include at least two directors who are “nonemployee directors” within the meaning of SEC Rule 16b-3 and who are “outside directors” for purposes of Section 162(m) of the Internal Revenue Code.

Performance Goals. Under Section 162(m) of the Internal Revenue Code, compensation in excess of $1 million paid in any year to any “covered employee” (as defined by Section 162(m)) is deductible by the company if it is based on the achievement of pre-established performance goals and meets certain other requirements of the rules. The Committee has adopted performance goals under which awards under the 2016 Plan for covered employees could be performance based and therefore could be fully deductible and not subject to the limitations of Section 162(m). The performance goals for performance awards of stock-based incentive compensation under the

2016 Plan (whether such awards take the form of stock, stock units, or equivalents or cash) made (or paid) to any eligible associate would consist of objective tests derived from one or more of the following: earnings per share, total shareholder return, operating income, net income, adjusted net earnings, cash flow, return on equity, return on capital, combined ratio, premium growth, investment performance and/or value creation ratio. The specific performance goal and applicable performance targets and payout opportunities are set forth in each grant agreement, along with other terms and conditions. The Committee sets the performance targets within the first 90 days of the calendar year to which the goals apply. Performance goals may be measured solely on a corporate, subsidiary or business unit basis, or a combination thereof. Further, performance goals may reflect absolute company performance or a relative comparison of company performance to the performance of a peer group or other external measure of the selected performance goals.

Types of Awards. The 2016 Plan provides for stock incentives of several types, including stock options, stock appreciation rights, restricted stock, restricted stock units and other stock-based awards. Awards of all types may be made subject to performance goals established by the Committee.

Stock options granted under the 2016 Plan may either be incentive stock options qualifying under Section 422 of the Internal Revenue Code or nonqualified options, both exercisable for the company’s $2.00 par value common stock. At the time of grant, the Committee determines the exercise price for options granted under the 2016 Plan, which may not be less than fair market value of the company’s common stock at that date. As of February 29, 2016, the Nasdaq Global Select Market’s closing price for the company’s stock was $63.14.

The Committee also determines the term of each option, which may not exceed 10 years from the date of grant. Options become exercisable in accordance with a vesting schedule established by the Committee at the time of grant. Depending on the type of option, the Committee may permit an option to be exercised by the participant either for a cash payment or the delivery of shares of the company’s common stock held by the participant, potentially including shares acquired upon exercise of the option.

As under the company’s prior stock plans, the aggregate fair market value cannot exceed $100,000, determined at the time of grant, for the shares of common stock an associate may acquire through incentive stock options that become exercisable for the first time during any calendar year. Additionally, the Committee may not grant an amount of stock options to any one plan participant during any single calendar year that may be converted into more than 100,000 shares of common stock. At its sole discretion, the Committee may provide, at the time of grant, that the shares to be issued upon an option’s exercise be in the form of restricted stock or other similar securities, or the Committee may reserve the right to so provide after the time of grant.

In general, if a plan participant’s employment is terminated, other than for death, disability, retirement or specified actions initiated by the company, all of the participant’s unexerciseable options are forfeited and all exercisable options also will be forfeited unless exercised before the participants termination date.

Shares of restricted common stock also may be awarded. The restricted stock vests and becomes transferable upon the satisfaction of conditions set forth in the restricted stock award agreement. Restricted stock awards may be forfeited if, for example, the recipient’s employment terminates before the award vests. Except as specified in the restricted stock award agreement, the holder of a restricted stock award has all the rights of a holder of common stock, including the right to receive dividends on the restricted shares.

Restricted stock units representing the right to receive common stock, cash, or both (as the Committee determines) also may be awarded. Restricted stock units vest upon the satisfaction of conditions specified in the award agreements. Restricted stock units may be forfeited if, for example, the recipient’s employment terminates before the award vests. Except as specified, the holder of a restricted stock unit or award has none of the rights of a holder of common stock unless and until shares of common stock are actually delivered in satisfaction of such units. The Committee may not grant more than 100,000 common shares worth of restricted stock and restricted stock units to any one plan participant during any single calendar year.

Stock appreciation rights (or SARs) may be granted either singly or in combination with underlying stock options. SARs entitle the holder upon exercise to receive an amount in any combination of cash or shares of common stock (as the Committee determines) equal in value to the excess of the fair market value of the shares covered by such right over the grant price. The grant price for SARs may not be less than the fair market value of the common stock on the date of grant.

The 2016 Plan also provides for other potential awards that may be denominated in, valued by reference to, or otherwise based on or related to, common stock. The Committee specifies the terms of grant, purchase, exercise, exchange or conversion of other stock-based awards. These awards may include, for example, performance shares that entitle the recipient to receive, upon satisfaction of performance goals or other conditions, a specified number of shares of common stock or the cash equivalent thereof. Where the value of such stock-based award is based on the difference between the fair market value of the shares covered by such award and the exercise price, the grant price for such award may not be less than the fair market value on the date of grant. The Committee may not grant more than 100,000 common shares worth of SARs and other stock-based compensation to any one plan participant during any single calendar year.

Performance-based awards may be issued to participants for no cash consideration or for such minimum consideration as may be required by applicable law, either alone or in addition to other awards granted under the plan. The Committee determines the performance goals and associated performance targets to be achieved during any performance period under the 2016 Plan and the length of the performance period. Performance awards are generally paid only after the end of the relevant performance period. Performance awards may be paid in cash, shares of common stock, other property or any combination thereof, as the Committee determines, in its sole discretion, at the time of payment. Performance awards may be paid in a lump sum or in installments following the close of the performance period.

Acceleration of Awards Provisions. In the event an associate’s employment is terminated within 12 months after the effective date of and due to a change in control as defined in the 2016 Plan, all stock options and SARs held by the associate as of the date of termination would become fully vested and immediately exercisable; the restrictions applicable to outstanding restricted stock, restricted stock units, and other stock-based awards would lapse; and the awards would become free of all restrictions and fully vested.

Amendment and Termination. The board of directors can amend the 2016 Plan to meet changes in law or regulations or for any other purpose that at the time may be permitted by law, except that the total number of shares to be issued through the plan may not increase and the board may not decrease the participant’s exercise price of stock options, SARs or other stock-based awards to an amount less than the fair market value on the date of the grant. Additionally, the Committee may not cancel any issued stock option, SAR or other stock-based award and replace it with a lower grant price, cash or other awards, without shareholder approval.

Proceeds. The proceeds from the sale to participants of common stock upon the exercise of any and all stock options and any other stock-based compensation issued under the 2016 Plan constitute general funds of the company and may be used by it for any purpose.

Clawback. Any awards granted under the 2016 Plan will be subject to reduction, cancellation, forfeiture or recoupment to the extent required by applicable laws, regulations, stock exchange listing rules, company policies or to the extent otherwise provided in an award agreement at the time of grant.

Accounting and Federal Income Tax

The board of directors recognizes that shareholders are interested in the impact of stock option expense on net income. Since 1996, following Financial Accounting Standards Board (FASB) accounting standards, the company has clearly disclosed the estimated impact of stock options on net income and earnings per share in a Note to the Financial Statements and fully complied with amended requirements for disclosures in quarterly financial statements. The company has adopted FASB Accounting Standards Codification (ASC) 718, Compensation – Stock Compensation, which calls for stock option expense to be included as a component of net income.

Corporate Federal Income Tax. To the extent that a participant recognizes ordinary income in the circumstances described below, the company is entitled to a corresponding deduction provided that, among other things: (i) the income meets the test of reasonableness, is an ordinary and necessary business expense and is not an “excess parachute payment” within the meaning of Section 280G of the Internal Revenue Code and is not disallowed by the $1 million limitation under Section 162(m) of the Internal Revenue Code on compensation paid to specified executive officers and (ii) any applicable reporting obligations are satisfied. Section 162(m) of the Internal Revenue Code limits the federal income tax deduction for compensation paid to the chief executive officer and the four other most highly compensated executive officers of a publicly held corporation (covered employees) to $1 million per fiscal year, with exceptions for certain performance-based compensation made under qualifying, shareholder-approved plans. Our intention in designing the 2016 Plan is that all stock option awards, as well as restricted stock awards, performance awards and other stock unit awards granted subject to performance goals, can constitute performance-based compensation for purposes of Section 162(m).

Participant Federal Income Tax. In general, an optionee recognizes no income at the time a nonqualified option is granted; at the time of exercise of a nonqualified option, the optionee recognizes ordinary income for the difference between the purchase price paid for the shares and the fair market value of the nonrestricted shares on the date of exercise; and at the time of sale of shares acquired through the exercise of a nonqualified option, any appreciation (or depreciation) in the value of the shares after the date of exercise is treated as either short-term or long-term capital gain (or loss) depending on how long the participant has held the shares.

An optionee generally recognizes no income upon the grant or qualifying exercise of an incentive stock option. However, for purposes of calculating the optionee’s alternative minimum tax, if any, the difference between the fair market value of the shares at exercise and the purchase price constitutes an item of adjustment. If the optionee makes no disqualifying disposition, shares acquired through exercise of an incentive option within two years after the grant date or within one year after the transfer of the shares to the optionee, then any proceeds from selling the shares in excess of the purchase price are taxed to the optionee as long-term capital gain and any loss sustained is a long-term capital loss. If shares acquired upon the exercise of an incentive stock option are disposed of prior to the expiration holding period described above, the optionee generally recognizes ordinary income in the year of disposition in an amount equal to any excess of the fair market value over the purchase price at the time of exercise (or, if less, the amount realized on the disposition of the shares in a sale or exchange). Any further gain or loss realized by the optionee generally is taxed as short-term or long-term gain or loss, depending on the holding period.

A participant recognizes no income in connection with the grant of a SAR. When the SAR is exercised, the participant normally is required to include as taxable ordinary income in the year of exercise the total amount of any cash plus the fair market value of any nonrestricted shares received2017 Annual Shareholder Meeting pursuant to the exercise.

A recipient of a restricted common stock award generally is subject to tax at ordinary income rates on the fair market valuecompensation disclosure rules of the restricted shares reduced by any amountSEC, including the recipient pays forCompensation Discussion and Analysis, the shares, at such time as2016 Summary Compensation Table and the shares are no longer subject to a substantial risk of forfeiture or restrictions on transfer for purposes of Section 83 of the Internal Revenue Code. However, a recipient who so elects under Section 83(b) of the Internal Revenue Code within 30 days of the date of receipt of the shares has taxable ordinary income on the date of receipt equal to the excess of the fair market value of the shares (determined without regard to the risk of forfeiture or restrictions on transfer) over any purchase price paid for the shares. If a Section 83(b) election has not been made, any dividends received with respect to restricted shares that are subject at that time to a substantial risk of forfeitureother related tables and restrictions on transfer generally are treated as taxable ordinary income to the recipient.

Generally, a participant recognizes no income in connection with the grant of a restricted stock unit or any performance-based award. Subject to the specific terms of the award, when the award is paid to the participant, the participant normally is required to include as taxable ordinary income in the year of payment the total amount of any cash plus the fair market value of any nonrestricted shares of common stock, actually or constructively received.

Summary

By adding the proposed 2016 Plan to the shares remaining in the current 2012 Plan and 2006 Plan, your company can continue offering a mix of stock-based incentives. The 2016 Plan would continue to accommodate performance-based awards, provide opportunities to optimize the company’s tax deductions and encourage associates to be vested owners whose interests are aligned with those of other shareholders.

Generally the Committee expects that when the company’s performance adds or preserves more value for shareholders than its peers, that compensation for the named executive officers, including the chief executive officer, will be higher than when the company’s performance lags its peers. Accordingly, the primary performance metrics for both annual and long-term performance-based compensation are calibrated to the company’s performance compared with the companies in the peer group. At the same time, the Committee expects compensation to directionally correlate with the company’s actual performance for these metrics, particularly when considered over the long term. The following graph illustrates the directional relationships between company performance, based on the two primary performance metrics used in our performance-based awards and the compensation of our chief executive officer for each of the three years ending 2015.

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2016.

CEO Pay for Performance

 

CEO Pay for Performance		2013			2014			2015
SCT Total Compensation	$	3,501,957		$	2,623,807		$	2,163,984
Realized Compensation(1)	$	2,971,137		$	2,434,715		$	1,936,016
1-Year VCR		16.1%			12.6%			3.4%
3-Year Total Shareholder Return(2)		88.6%			90.6%			69.1%

CEO Pay for Performance	2014				2015				2016
SCT Total Compensation	$	2,623,807			$	2,163,984			$	4,249,903
Realized Total Compensation(1)	$	2,434,715			$	1,936,016			$	3,711,998
1-Year VCR	12.6		%		3.4		%		14.5		%
3-Year TSR(2)	90.6		%		69.1		%		60.6		%

(1)	Realized compensation is the sum of salary and annual incentive cash compensation reported in the Summary Compensation Table for the year plus the value realized from the exercise of stock options and vesting of time-vesting or performance-based restricted stock units, if any, reported in the Option Exercises and Stock Vested table for the yearyear.

(2)	3-Year Total Shareholder Return is total shareholder return for the 3-year performance period ending December 31 of a given year, as calculated by and displayed on Bloomberg LP.

Over the last three years, compensation for our chief executive officer varied in line with overall company performance, even as the Committee adjusted base annual salary and targets for performance-based compensation. Payouts of annual incentive and long-term performance-based awards throughout the period also directly align with company performance.

	Annual Incentive Compensation (VCR)		Long-Term Performance-Equity Compensation (3-Year Total Shareholder Return)
	Performance Relative to Peer Companies	Performance Level Earned	Performance Relative to Peer Companies	Performance Level Earned	Performance Relative to Peer Companies	Performance Level Earned
2016	> 9 Peers*	Maximum	> 5 Peers	Target
2015	> 4 Peers	ThreshholdThreshold	> 4 Peers	ThreshholdThreshold
2014	> 6 Peers	Target	> 6 Peers	Target

2013	>9 Peers
*	Maximum	> 10 Peers	MaximumFor the annual performance period ending December 31, 2016, the company's VCR exceeded that of eight Peer Group companies and achievement of the additional performance goals for net written premium growth and combined ratio added one additional peer placement. For annual performance periods ending December 31, 2015 and 2014, annual incentive compensation payouts were determined by the company's performance based on the single performance metric of relative VCR.

Our performance over the last three years ranked slightly belowexceeded the median of the 10nine companies of our peer group as measured by three-year total shareholder return. As suggested by the Three-Year Relative Pay for Performance graph below, total realizable compensation^†2 for our chief executive officer and the other named executive officers over the same period remains comparatively low, ranking near the 25^th percentile, largely reflecting the size of several of the companies included in the peer group. Because we do not benchmark executive compensation to the peer group, our performance is judged against those companies with whom we compete every day for each insurance policy we write, regardless of the size of those companies.

²Three-year total realizable compensation is the sum of the following components of compensation as reported and calculated by Equilar: salary paid, discretionary cash bonus, nonequity incentive compensation paid, amounts realized from the exercise of stock options or vesting of stock awards, the intrinsic value of exercisable “in the money” stock options and the grant date fair value of time vesting and target-level performance-based restricted stock or restricted stock unit awards, for the three years ending December 31, 2015, the most recent year for which such data is available.

†

Three-year total realizable compensation is the sum of the following components of compensation as reported and calculated by Equilar: salary paid, discretionary cash bonus, nonequity incentive compensation paid, amounts realized from the exercise of stock options or vesting of stock awards, the intrinsic value of exercisable “in the money” stock options and the grant date fair value of time vesting and target-level performance-based restricted stock or restricted stock unit awards, for the three years ending December 31, 2014, the most recent year for which such data is available.

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Three-Year Relative Pay for Performance

(2013-2015) 

 

(2014-2016)

Results of 20152016 Advisory Vote to Approve Executive Compensation

At the 20152016 Annual Meeting of Shareholders, nearly 98more than 97 percent of the votes cast were in favor of this proposal. The Committee believed this favorable outcome demonstrated support of its decisions and our overall executive compensation program. SubsequentOur annual discussions with investors representing approximately 30 percent of the shares outstanding confirmedconfirm this belief. All of the shareholders contacted during our annual investor engagement efforts in 2016 favorably commented on the company’s executive compensation program, criteria for performance-based awards and overall level of pay. As a result, theThe Committee made no material changes in the structure of our compensation program in 2015.2016 as a result of feedback from investors, but it did introduce additional performance objectives to the annual incentive compensation awards to add emphasis and weight to key operational metrics (see Page 46). At the 20162017 Annual Meeting of Shareholders, we will again hold an advisory vote to approve executive compensation (see Page 39)37). The Committee will continue to consider the results of these annual advisory votes and feedback from investor outreach in its deliberations about our executive compensation program.

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program.

Executive Compensation Practices

The committeeCommittee applies certain fundamentals that are key characteristics of our overall compensation program, including:

We Do	We Don’t
Link Pay to Performance –- The majority of pay awarded by the Committee to each executive officer each year is tied to achievement of short- and long-term performance objectives and changes in the market value of the company’s common stock.	Use Employment Contracts –- We employ all of our executive officers at will.
Review Data Sheets –- Each year the Committee reviews data recounting the compensation history for each executive officer. For the named executive officers, the Committee additionally reviews compensation and performance data for the companies in the peer group before making executive compensation decisions.	Pay Dividends or Dividend Equivalents –- We do not pay dividends or dividend equivalents on unvested stock awards.
Mitigate Excessive Risk –- Compensation earned from performance-based awards is capped and is subject to clawback policies and provisions. Company-level performance objectives relative to peers minimizes the ability of any single individual or business unit to control its own performance-based compensation. The Committee’s authority to exercise negative discretion and eliminate payment of any award also is a powerful risk control.	Reprice or Exchange Stock Options –- We do not reprice or exchange stock options. We consider stock options to be performance-based compensation that links the financial success of our associates to shareholders. Since shareholders cannot reprice or exchange their shares, neither do we.
Use Double-Trigger Change in Control Provisions –- Both our annual incentive and stock-based compensation plans include double-trigger change in control provisions.	Include Stock-Based Awards in Calculations for Pension or Other Retirement Benefits –- Our pension is calculated based on salary only, and our matches to 401(k) and Top Hat Savings Plan contributions are limited to cash compensation.
Perform Compensation Risk Assessments –- Our chief risk officer performs this assessment each year, and it is considered by the Committee as part of its decision making process.	Allow Hedging Transactions by Executive Officers or Directors –- Our Securities Trading Policy prohibits transactions such as short sales, prepaid forward sales contracts or other hedging transactions that we believe decouple the director’s or officer’s interests from those shared by our shareholders generally.
Track Compliance Withwith Ownership Guidelines –- All of our directors and executive officers satisfyare in compliance with our published stock ownership guidelines.

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Components of Compensation

Components of Compensation

Total direct compensation (TDC) is the compensation annually determined or awarded each year by the Committee. TDC generally is the sum of three components: base annual salary, target levels of annual incentive cash compensation and long-term equity compensation comprised of target levels of performance-based and service-based equity compensation. As illustrated in the following charts, in 2015, 702016, approximately 71 percent of TDC awarded to the chief executive officer and 6160 percent of the TDC awarded to the other named executive officers was considered performance-based and not guaranteed.

Base Annual Salary

We use base annual salary to attract executive talent and to provide adequate and stable compensation. The Committee reviews and sets base annual salaries for the named executive officers each year. In determining base annual salary, the Committee considers:

·

The officer’s role and responsibilities,

·

Fairness, as compared with officers with similar responsibilities, experience and performance,

·

Current compensation level, and

·

Individual performance.

The officer’s role and responsibilities,

Fairness, as compared with officers with similar responsibilities, experience and performance,

Current compensation level, and

Individual performance.

Base annual salaries may be adjusted to reflect annual merit increases, if any; promotions or changes in role or responsibilities; and market adjustments.

The base annual salaries for the named executive officers were adjusted in February 20152016 to recognize the strong individual contribution of each officer to the company’s strong performance in the prior year. On average, base annual salary for the group increased approximately 2.22.6 percent. On an individual basis, each named executive officer’s salary was adjusted as follows:

·

For Mr. Johnston, an increase of 2.0 percent to $945,540;

·

For Mr. Scherer, an increase of 2.0 percent to $866,745;

·

For Mr. Sewell, an increase of 2.0 percent to $772,191;

·

For Mr. Hollenbeck, an increase of 2.5 percent to $636,525; and

·

For Mr. Stoneburner, an increase of 2.5 percent to $636,525.

For Mr. Johnston, an increase of 2.0 percent to $964,451;

For Mr. Scherer, an increase of 3.0 percent to $892,747;

For Mr. Sewell, an increase of 2.0 percent to $787,635;

For Mr. Hollenbeck, an increase of 2.0 percent to $649,256; and

For Mr. Stoneburner, an increase of 4.0 percent to $661,986.

Annual Incentive Compensation

We pay annual incentive compensation to encourage achievement of key short-term performance objectives believed to be important for achievement of longer-term strategic goals. Under the shareholder-approved Annual Incentive Compensation Plan of 2009, as amended (2009 Annual Incentive Plan), each executive officer is eligible to annually receive an award of up to $3 million in cash based on achievement of specific performance-based criteria.

The 2009 Annual Incentive Plan offers a wide range of performance objectives from which the Committee may choose. The specific performance objectives, hurdles and targets for each year are contained in the award agreements delivered to the individual officer. The 2009 Annual Incentive Plan also features a

forfeiture and recoupment provision to enable the company to recover

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payments under this plan when circumstances warrant. Awards of incentive compensation tie vesting of a portion of annual cash compensation to performance goals and can qualify as performance-based, tax-deductible executive compensation.

Since

Performance Objectives.

From 2009 through 2015, the performance objectiveCommittee used for annual incentive compensation awards is our one-year value creation ratio (VCR) relative to our peer group.group as the single performance objective for our annual incentive compensation awards. We believe this measure captures the contribution of our insurance operations, the success of our investment strategy and the importance we place on paying cash dividends to shareholders. The value creation ratio is a two-part metric: i)1) our rate of growth in book value per share, plus ii)2) the ratio of dividends declared per share to beginning book value per share. For the period 2013 through 2017, we are targeting an annual value creation ratio averaging 10 percent to 13 percent as our primary performance goal.

For awards granted in 2016, the Committee used a multi-metric formula that retained the relative VCR performance objective as the the primary performance metric for annual incentive compensation and added two more performance objectives: 1) revenue as measured by property casualty net written premium growth (premium growth goal), and 2) underwriting profitability as measured by the combined ratio (combined ratio goal). The Committee added these performance objectives to emphasize the importance of consistent profitable premium growth by increasing the influence of these annual operating measures on the determination of annual incentive compensation award payout levels. When both operating goals of premium growth and combined ratio are achieved, the company's relative placement among the peer group companies may be improved by up to three placements to determine the final award placement. For the named executive officers, the maximum effect of the addition of these two performance objectives is capped at one additional payout level, for example from a threshold to a target level payout, but not from a threshold to a maximum level payout.

Setting Target Amounts.

Target amounts for annual incentive compensation are set by the Committee as a percentage of the named executive officer’s salary. TheIn 2016, the percentage of salary ranged from 65 percent to 100110 percent based on the named executive officer’s tier. Assignment to a particular tier was based on level of responsibility. In 2015,2016, Mr. Johnston was assigned to the chief executive officer’s tier for which the target level award was 100110 percent of base annual salary. All of the otherThe remaining named executive officers were assigned to Tier I for which target level awards were 65 percent of base annual salary.

Determining Final Award Placement

Determination of the final award placement is a three-step process:

Step 1 - The Committee determines the company's baseline award placement among the peer group companies based on relative VCR. As in prior years, when the company's VCR exceeds the VCR of one or more of the companies in the peer group, the company's baseline award placement increases by one for each peer group company exceeded.

Step 2 - The Committee determines whether the company achieved the pre-established premium growth goal. For 2016, the growth goal was 2.0 percent or more. If the company does not achieve the growth goal, then the final award placement is the baseline award placement determined in Step 1. If the growth goal is achieved, then the final award placement is determined by Step 3.

Step 3 - The Committee determines the achievement of the final award placement based on achievement of the combined ratio goal. The combined ratio goal for 2016 awards is as follows:

◦	When the combined ratio is 95.0 percent or better, the company's baseline award placement improves by one placement.

◦	When the combined ratio is 93.0 percent or better, the company's baseline award placement improves by two placements.

◦	When the combined ratio is 91.0 percent or better, the company's baseline award placement improves by three placements.

If the company does not achieve the combined ratio goal, then the final award placement is the baseline award placement determined in Step 1.

Setting Performance Hurdles

Performance hurdles for threshold, target and maximum awards were set at the 30^th, 50^th and 75^th percentiles, respectively, of the peer group. Stated another way, the company’s value creation ratiofinal award placement must exceed that of three of the 10nine peer companies to achieve the threshold hurdle, must equal or exceed five peer companies to achieve the target hurdle and must equal or exceed eightseven peer companies to achieve the maximum hurdle. Achievement of threshold, target and maximum performance hurdles earns award payouts of 30 percent, 100 percent and 200 percent, respectively, of target.

Calculating the Annual Incentive Award Earned

Step 1: Determining the Baseline Award Placement Using Relative VCR

As shown in the following chart, for 2016, the company achieved a value creation ratio of 14.5 percent, and exceeded the value creation ratio achieved by eight of the nine peer companies. This established the baseline award placement of exceeding eight of nine companies.

Step 2: Determining Achievement of Premium Growth Goal

The premium growth goal for awards granted in 2016 was 2.0 percent or more. The company reported property casualty net written premium growth of 5.0 percent, satisfying the premium growth goal.

Step 3: Determining Achievement of Combined Ratio Goal

The company reported a property casualty combined ratio of 94.8 percent, satisfying the combined ratio goal, improving its relative placement by one placement, resulting in a final award placement that exceeds all nine of the peer group companies.

The final award placement that exceeds nine of the peer group companies satisfies the performance hurdle for a maximum award payout of 200 percent of target.

The following formula is used to calculate the annual incentive award earned:

Base Annual Salary X Tier Target % X Performance Factor (0 –- 200%)

As shown in the following chart, for 2015, the company achieved a value creation ratio of 3.4 percent and exceeded the value creation ratio achieved by four of the 10 peer companies, qualifying for threshold-level payouts of 30 percent of target.

 

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The following table shows how the formula was applied and the actual amounts awarded for 2015.

Name	Base Annual Salary ($)	Tier Target % of Base Annual Salary	2015 Performance Factor (Threshold) (%)	2015 Annual Incentive Cash Compensation ($)
Steven J. Johnston	945,540	100	30	283,662
Jacob F. Scherer, Jr.	866,745	65	30	169,015
Michael J. Sewell	772,191	65	30	150,577
Martin F. Hollenbeck	636,525	65	30	124,122
Charles P. Stoneburner II	636,525	65	30	124,122

2016.

Name	Base Annual Salary ($)	Tier Target % of Base Annual Salary	2016 Performance Factor (Maximum) (%)	2016 Annual Incentive Cash Compensation ($)
Steven J. Johnston	964,451	110	200	2,121,792
Jacob F. Scherer, Jr.	892,747	65	200	1,160,572
Michael J. Sewell	787,635	65	200	1,023,925
Martin F. Hollenbeck	649,256	65	200	844,032
Charles P. Stoneburner II	661,986	65	200	860,582

Long-Term Stock-Based Compensation

General

We award stock-based compensation not only to reward service to the company, but also to provide incentive for individuals to remain in the employ of the company and help it prosper. We believe people tend to value and protect most that which they have paid for, generally by investing their time, effort or personal funds. Over the long run, we believe shareholders are better served when associates at all levels have a significant component of their financial net worth invested in the company. For that reason, we grant awards of stock-based compensation not only to our directors and to named executive officers, but also generally to full-time salaried associates of the company who are in good standing. We believe this approach encourages associates at all levels to make decisions in the best interest of the company as a whole, linking their personal financial success with the company’s success. Although we do not have access to information about broker accounts, we estimate that approximately 80 percent of our current associates hold shares of Cincinnati Financial Corporation. Stock ownership guidelines applicable to all directors and officers help the Committee monitor ownership for all directors and officers. Our Director and Officer Stock Ownership Guidelines can be found atcinfin.com/investors.

Stock-based awards granted to all associates in 2015February 2016, totaled less than 1 percent of total shares outstanding. In 2015,2016, approximately 1817 percent of all stock-based awards were granted to the company’s executive officers, including the named executive officers, and approximately 8283 percent were granted to more than 3,000 other company associates. All stock-based awards are granted at 100 percent of fair value on the date of grant.

Types of Stock-Based Awards

The Committee grants three types of stock-based awards to the named executive officers: nonqualified stock options, performance-based restricted stock units (PSUs) and service-vesting restricted stock units (RSUs). The Committee finds these awards effective because stock options have value only if there is a corresponding increase in value recognized by shareholders, while PSUs focus executives on the sustained long-term performance of the company regardless of short-term stock price fluctuations. RSUs further emphasize the long-term focus and strengthensstrengthen the alignment of financial interests shared by executives and shareholders. Both stock options and PSUs can qualify as performance-based, tax-deductible executive compensation. The named executive officers also are eligible to receive shares under the Holiday Stock Plan. We do not pay dividends or dividend equivalents on unvested stock-based awards.

Stock Options – - For the named executive officers, the Committee uses nonqualified stock options that vest and become exercisable in equal amounts over the three years following the grant date. We consider stock options to be performance-based compensation, because the associate recognizes value only if the market value of our stock appreciates over time. Stock options tie the compensation realized from such awards, if any, to changes in the stock price experienced by shareholders generally. When the stock price does not increase, the stock options do not have value. We do not, and have not, backdated, repriced or exchanged stock options.

PSUs – - For the named executive officers, the Committee uses PSUs that cliff vest after three years if performance targets are achieved. PSUs tie vesting of a portion of stock-based compensation to performance goals, and the three-year performance period for awards of PSUs reinforces the company’s long-term focus and matches the period after which stock option awards are fully vested

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and exercisable. If performance hurdles are achieved and an award of PSUs vests, the award is paid in shares of common stock, one share for each restricted stock unit. For PSUs, the Committee expects to set targets that it considers achievable, but that require some stretch, based on market conditions and the current insurance industry environment at the time of grant.

Since November 2008, the performance objective for PSUs has been three-year total shareholder return relative to the companies in the peer group. The Committee selected this measure because total shareholder return combines share price appreciation and dividends paid. It measures the total return achieved for the shareholder and the relative position reflects the market perception of overall performance relative to the peer group.

RSUs– - For the named executive officers, the Committee uses RSUs that ratably vest in thirds over three years. The Committee added RSUs as a regular component of compensation for the named executive officers beginning in 2015 to place greater emphasis on long-term compensation and strengthen the alignment of executive officer and shareholder financial interests.

Setting Target Amounts for Stock-Based Awards

Target amounts for performance-based stock compensation (nonqualified stock options and PSUs) are set by the Committee as a percentage of the named executive officer’s salary. For 2015,2016, the percentage of salary ranged from 97.5 percent to 150 percent based on the named executive officer’s tier. Assignment to a particular tier was based on level of responsibility. In 2015,2016, Mr. Johnston was assigned to the chief executive officer’s tier for which the target level award was 150 percent of base annual salary. All of the otherThe remaining named executive officers were assigned to Tier I for which target level awards were 97.5 percent of base annual salary. The target dollar amount is then allocated between stock options and PSUs, and the target dollar amount for each is then divided by the fair value of the company’s stock on the date of grant to determine the target number of shares for each award. For 2015,2016, the target value for stock awards was allocated 50 percent to PSUs and 50 percent to stock options. The following formula is

was used to calculate the number of shares underlying each grant of performance-based stock compensation.

Base Annual Salary X Tier Target % X Award Allocation %	=	Target # of Shares Underlying Award
Grant Date Fair Value

The Committee historically used the grant date fair value as the demonimator in the above calculation to determine the number of shares for both nonqualified stock options and PSUs. This methodology produces an equal number of shares allocated to each type of award and helps to conserve the number of shares available for grant under the shareholder approved plans.

Similarly, the Committee sets amounts for RSUs as a percentage of the named executive officer’s salary. For 2015,2016, the percentage of salary for each named executive officer was 510 percent. The following formula is used to calculate the number of shares underlying each grant of RSUs:

Base Annual Salary X 5%10%	=	# of Shares Underlying Award
Grant Date Fair Value

The Committee believes that its method for determining the number of shares for each stock-based award helps to conserve the number of shares available for grant under the shareholder approved plans.

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2015

2016 Stock-Based Grants

At its meeting on February 13, 2015,12, 2016, the Committee granted the following stock-based awards to the named executive officers:

Name	# Nonqualified Stock Options	# PSUs	# RSUs
Steven J. Johnston	13,573	13,573	905
Jacob F. Scherer, Jr.	8,087	8,087	830
Michael J. Sewell	7,205	7,205	739
Martin F. Hollenbeck	5,939	5,939	610
Charles P. Stoneburner II	5,939	5,939	610

Name	# Nonqualified Stock Options	# PSUs	# RSUs
Steven J. Johnston	11,768	11,768	1,569
Jacob F. Scherer, Jr.	7,081	7,081	1,453
Michael J. Sewell	6,247	6,247	1,282
Martin F. Hollenbeck	5,150	5,150	1,057
Charles P. Stoneburner II	5,251	5,251	1,077

For the PSUs granted in 2015,2016, performance hurdles for threshold, target and maximum awards were set at the 30^th, 50^th and 75^th percentiles, respectively, of the peer group. Stated another way, the company’s three-year total shareholder return must exceed that of three of the 10nine peer companies to achieve the threshold hurdle, must equal or exceed that of five peer companies to achieve the target hurdle and must equal or exceed that of eightseven peer companies to achieve the maximum hurdle. Beginning with PSUs granted in 2013, the Committee broadened the range of potential award payouts to match those of annual incentive compensation awards. For PSUs granted in 2015,2016, achievement of threshold, target and maximum performance hurdles earns award payouts of 30 percent, 100 percent and 200 percent, respectively, of target. Over time, the Committee intends that the expanded range will result in delivery of a higher proportion of compensation through long-term performance-based compensation awards.

The following formula describes how the Committee calculates the number of shares earned:

Target # of Shares Underlying Award X Performance Factor (0 –- 200%)

The performance period for the PSUs awarded in 20152016 is the three calendar years ending December 31, 2017.2018. The PSUs will vest and become payable on March 1, 2018,2019, if the company achieves one of the performance hurdles described in the preceding paragraph.

Compensation Realized From PSUs Granted in Prior Years

The company’s three-year TSR for the three-year performance period ended December 31, 2015,2016, was 69.07%,60.6 percent, exceeding that metric for fourfive of the 10nine companies in the peer group and earning payout at the thresholdtarget level of 30100 percent of the target number of shares.

Name	Performance Period	Target PSUs (#)	Achievement Level	PSUs Vested (#)	Value of PSUs Vested ($) (1)
Steven J. Johnston	2013-2015	13,088	Threshold	3,927	232,361
	2012-2014	13,472	Target	13,472	698,254
	2011-2013	6,443	Maximum	8,054	421,788
Jacob F. Scherer, Jr.	2013-2015	8,998	Threshold	2,700	159,759
	2012-2014	10,262	Target	10,262	531,879
	2011-2013	4,799	Maximum	5,999	314,167
Michael J. Sewell	2013-2015	8,016	Threshold	2,405	142,304
	2012-2014	9,578	Target	9,578	496,427
	2011-2013	5,011	Maximum	6,264	328,046
Martin F. Hollenbeck	2013-2015	6,544	Threshold	1,964	116,210
	2012-2014	7,731	Target	7,731	400,698
	2011-2013	3,311	Maximum	4,139	216,759
Charles P. Stoneburner II	2013-2015	6,544	Threshold	1,964	116,210
	2012-2014	7,526	Target	7,526	390,073
	2011-2013	3,349	Maximum	4,187	219,273

	Name	Performance Period	Target PSUs (#)		Achievement Level	PSUs Vested (#)		Value of PSUs Vested ($) (1)
	Steven J. Johnston	2014-2016	12,873		Target	12,873		975,130
		2013-2015	13,088		Threshold	3,927		232,361
		2012-2014	13,472		Target	13,472		698,254
	Jacob F. Scherer, Jr.	2014-2016	8,850		Target	8,850		670,388
		2013-2015	8,998		Threshold	2,700		159,759
		2012-2014	10,262		Target	10,262		531,879
	Michael J. Sewell	2014-2016	7,885		Target	7,885		597,289
		2013-2015	8,016		Threshold	2,405		142,304
		2012-2014	9,578		Target	9,578		496,427
	Martin F. Hollenbeck	2014-2016	6,468		Target	6,468		489,951
		2013-2015	6,544		Threshold	1,964		116,210
		2012-2014	7,731		Target	7,731		400,698
	Charles P. Stoneburner II	2014-2016	6,468		Target	6,468		489,951
		2013-2015	6,544		Threshold	1,964		116,210
		2012-2014	7,526		Target	7,526		390,073

(1)	Based on the closing price on Nasdaq as of the last trading day of the performance period as follows:

$59.17 for the performance period ending December 31, 2015

$51.83 for the performance period ending December 31, 2014

$52.37 for the performance period ending December 31, 2013

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$75.75 for the performance period ending December 31, 2016

$59.17 for the performance period ending December 31, 2015

$51.83 for the performance period ending December 31, 2014

Other Stock-Based Compensation

The named executive officers are eligible to receive stock bonuses under the company’s broad-based Holiday Stock Plan, which annually awards one share of common stock to each full-timefull‑time associate in good standing for each year of service, up to a maximum of 10 shares. This plan, in effect since 1976, encourages stock ownership at all levels of the company.

Policy on Hedging and Pledging of Company Stock

Hedging – - All of our officers and directors and certain associates identified by management as having regular access to potentially material, nonpublic information are prohibited from engaging in any form of hedging or monetization transactions involving the company’s stock. Such transactions can decouple the officer’s or director’s interest from the interests of shareholders generally and can limit the officer’s or director’s ability to control the timing of stock transactions to avoid times when in possession of material nonpublic information.

Pledging – - We enjoy a strong culture of ownership, linking the long-term financial prospects for our associates to the long-term financial prospects for our shareholders generally through broad-based grants of equity compensation awards. Some of our associates, including some executive officers, choose to build their ownership in the company by pledging shares they own to collateralize loans from banks or brokers to exercise employee stock options. Some directors, officers and associates choose to hold their shares of stock in street name in accounts with banks or brokers as a matter of convenience. Depending on individual circumstances and decisions, these accounts can be subject to margin or collateral requirements.

Accordingly, we permit our directors, officers and associates to pledge shares of company stock that they own. The board expects directors and executive officers to exercise good judgment when making decisions about their holdings and transactions involving company stock, including pledging. The board anticipates that the level of share pledging by directors and executive officers will decrease over time. In 2015,2016, the level of shares pledged by our directors and executive officers as a group remained about the same as 20142015 levels.

A majority, 1617 of our 28current 27 directors and executive officers, do not pledge any shares. Another group of 10eight have pledged shares totaling less than 0.3 percent of the shares outstanding. The remaining two directors with pledged shares are members of one of the company’s founding families, with reported holdings of company stock that sufficiently outnumber the approximately 1.3 percent of shares outstanding that they hold in accounts and are available as collateral. Neither our chief executive officer nor our chief financial officer have pledged shares of company stock.

Stock-Based Award Grant Practices

In awarding stock options and other forms of stock-based compensation, the Committee follows certain general precepts:

TimingTiming.. Since 2010, the Committee established its February meeting as the date for granting stock-based compensation to company associates each year. This meeting is purposely scheduled to occur shortly after the company announces its financial results for the preceding quarter and year, and therefore occurs when it does not expect to be in possession of material nonpublic information. The Committee makes its grants of restricted stock to directors under the Directors’ Stock Plan of 2009 at its first regularly scheduled meeting of the year. The Committee believes the consistency of this practice since adoption of the first Director Stock Plan in 2003these practices eliminates concerns over timing. When grants are made at any other time of the year, the Committee ensures that such grants are grantedmade outside of any regular trading blackout associated with the company’s disclosure of financial results and when the company is not otherwise in possession of material nonpublic information.

Option Exercise PricePrice.. All stock-based compensation is granted at fair market value on the date of grant. ForUnder all stock-based awards since 2007 under the 2012 Stock Compensation Plan and the 2006 Stock Compensation Plan,compensation plans, fair market value is defined as the average of the high and low sale price on Nasdaq on the grant date. Unless a future date is specified, the grant date is the date of the Committee meeting at which the grant is made. Fair market value for awards under the 2009 Director Stock Plan and the Holiday Stock Plan is the average of the high and low sale price

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on Nasdaq on the grant date. The Committee does not delegate timing or pricing of these stock-based awards to management.

Retirement Benefits

Defined Benefit Plans

In 2015,2016, Messrs. Scherer and Stoneburner were participants in The Cincinnati Financial Corporation Retirement Plan (Retirement Plan), our tax-qualified defined benefit pension plan. There are no special or enhanced pension formulas for the named executive officers, compared with other plan participants. The plan was frozen and closed to new participants in mid-2008.

These two named executive officers also participate in The Cincinnati Financial Corporation Supplemental Retirement Plan (SERP). The SERP is unfunded and subject to forfeiture in the event of bankruptcy.

The SERP is a nontax-qualified defined benefit plan maintained by the company to pay eligible associates the difference between the amount payable under the tax-qualified plan and the amount they would have received without the tax-qualified plan’s limit due to Section 401(a)(17) and Section 415 of the Internal Revenue Code. Accordingly, the SERP definitions for service, normal retirement and annual earnings are the same as those for the Retirement Plan except the SERP’s definition of annual earnings is not limited.

For information about accumulated benefits under these plans and detailed information about the plans, see the 20152016 Pension Benefits table and the discussion following, beginning on Page 60.

67.

Defined Contribution Plans

The named executive officers can participate in a tax-qualified 401(k) savings plan as well as the Cincinnati Financial Corporation Top Hat Savings Plan, a nonqualified deferred compensation plan for a select group of management or certain highly compensated associates. The company matches contributions to the 401(k) plan made by associates who are not members of the Retirement Plan, including Messrs. Johnston, Sewell and Hollenbeck, up to a maximum of 6 percent of the associate’s annual cash compensation (salary and annual incentive compensation). The company also matches contributions by Messrs. Johnston, Sewell and Hollenbeck to the Top Hat Savings Plan of up to 6 percent of their annual cash compensation that exceeds the maximum recognizable compensation under Section 401(a)(17) of the Internal Revenue Code, which for 20152016 was $265,000.

For information about the amount of company matching contributions and specific information about the defined contribution plans, see the 20152016 Nonqualified Deferred Compensation table and the discussion following, beginning on Page 62.

69.

In 2008, the company transitioned away from providing associates with a defined benefit pension plan, instead choosing to assist associates to buildwith building savings for retirement by providing a company match of associate contributions to a tax-qualified 401(k) plan. This change was primarily in response to requests from associates who wanted control over their retirement benefit accounts. Participation in the defined benefit pension plan terminated for associates under the age of 40, and they transitioned to the new tax-qualified 401(k) plan with a company matching contribution. None of the named executive officers were under age 40 at the time of the transition. Associates age 40 and over as of August 31, 2008, were given a one-time election to remain in the defined benefit pension plan or to leave the plan and participate in the 401(k) plan with a company match. Those associates leaving the pension plan received distributions of their accumulated pension benefit from the defined benefit plan that they could choose to receive in cash, roll over to the company’s 401(k) plan or roll over to an Individual Retirement Account. Mr. Hollenbeck elected to leave the defined benefit plan in connection with the 2008 transition. Messrs. Johnston and Sewell, hired after entry to the pension plan was closed, also participate in the 401(k) plan with the company match. Messrs. Scherer and Stoneburner elected to remain in the pension plan.

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Perquisites and Other Personal Benefits

Perquisites and other personal benefits are intended to support our corporate objectives or the performance of an individual’s responsibilities. Perquisites and personal benefits are offered to the named executive officers on the same basis as to other company officers and may include personal umbrella liability insurance coverage, life insurance, executive tax services, use of a company car, safe driver award, executive health exams, club dues and limited spouse travel and meals associated with certain business functions. The Committee believes that the level of perquisites and personal benefits we offer our officers is de minimis, totaling no more than $12,629$17,987 for any named executive officer in 2015.

How We Make Compensation Decisions

2016.

How We Make Compensation Decisions

Annual Compensation Setting Process

The Committee evaluates and sets compensation for the named executive officers annually. In doing so, it considers:

·

Its judgment about the effectiveness of the executive compensation program generally;

·

The effect of any changes to the program;

·

The result of the most recent shareholder advisory vote to approve executive compensation and feedback about the executive compensation program received from shareholders during annual outreach calls;

·

The compensation risk assessment conducted by the company’s chief risk officer;

·

Current and historical compensation and performance data supplied by the chief executive officer for each named executive officer, excluding himself;

·

Reports generated through Equilar on the amounts and components of compensation paid to the named executive officers of the companies in the peer group;

·

Each officer’s individual performance, experience, expertise and functional responsibilities; and

·

Company performance, both financial and nonfinancial.

Its judgment about the effectiveness of the executive compensation program generally;

The effect of any changes to the program;

The result of the most recent shareholder advisory vote to approve executive compensation and feedback about the executive compensation program received from shareholders during annual outreach calls;

The compensation risk assessment conducted by the company’s chief risk officer;

Current and historical compensation and performance data supplied by the chief executive officer for each named executive officer, excluding himself;

Reports generated through Equilar on the amounts and components of compensation paid to the named executive officers of the companies in the peer group;

Reports generated through Equilar on the financial performance of the companies in the peer group;

Each officer’s individual performance, experience, expertise and functional responsibilities; and

Company performance, both financial and nonfinancial.

The Committee meets in February each year to set base annual salaries, grant stock-based and incentive cash compensation awards and consider the payment of any performance-based compensation earned upon satisfaction of performance goals established in prior years’ award grants. The Committee also may meet during the year to set or adjust compensation appropriately if management changes or new executive officers join the company.

company or to consider potential prospective changes to the structure of the executive compensation program.

Compensation Risk Considerations

The Committee is responsible for overseeing the risk associated with the company’s compensation program. The company’s compensation plans and executive compensation program are designed with features intended to mitigate risk without diminishing the incentive nature of the compensation. We believe our compensation plans and programs encourage and reward prudent business judgment and appropriate risk taking, and do not create risks that are reasonably likely to have a material adverse impact on the company.

In 2015,2016, the Committee considered the annual compensation risk assessment conducted by the chief risk officer. For the executive compensation program, the risk assessment identified the component parts of the program and the information and process used by the committeeCommittee to set the level of compensation for each. Independence and qualifications of committee members and rigor of the committee’s oversight and administration of the executive compensation program also were examined.

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The table below summarizes the risk mitigation factors identified in the 2015annual compensation risk assessment.

Base Annual Salary Risk Mitigation Factors

Base annual salary is set each year.

Base annual salary levels are modest.

Base annual salary adjustments require approval of the Committee.

Annual Incentive Risk Mitigation Factors

Performance objectives Awards are based upon multi-metric performance objectives. The primary performance objective is relative to peer companies.

The two other performance objectives are publicly reported in the company's periodic reports. Achievement is determined by company performance, not individual performance.

Annual Robust processes require the Committee to certify performance achievement and authorize payment. Maximum payout of annual incentive compensation is subject to clawback provisions.

Performance objectives and targets are easily calculable and clearly disclosed to investors.

capped. The Committee may exercise negative discretion to reduce or eliminate awards when appropriate. Annual incentive compensation is subject to clawback provisions. Performance objectives and targets are easily calculable and clearly disclosed to investors.

Robust processes require the Committee to certify performance and authorize payment.

Long-Term Stock-Based Compensation Risk Mitigation Factors

The company has stock ownership guidelines applicable to the named executive officers.

Exercising stock options requires investment of the associate’s personal assets.

Performance objectives are relative to peer companies.

Achievement of performance for PSUs is determined by company performance, not individual performance.

Robust processes require the Committee to certify performance achievement and authorize payment. Maximum payout of performance-based restricted stock units is capped. Stock-based compensation is subject to clawback provisions.

Performance objectives and targets are easily calculable and clearly disclosed to investors.

The Committee may exercise negative discretion to reduce or eliminate awards when appropriate.

Robust processes require the Committee to certify performance achievement and authorize payment.

Benchmarking and Peer Group

We believe that it is important to link performance-based compensation to company performance compared with peers. Accordingly, the performance targets for our annual incentive compensation and PSUs are relative targets compared with our peer group. We also believe that linking the level of performance-based awards to a percentage of base annual salary that is paid out according to a predetermined formula based upon achievement of performance goals for all of our executive officers unites the personal financial interests of the executive team, focusing its attention on achievement of performance goals designed to increase shareholder value over the long term.

We do not use the peer group to benchmark executive compensation. We use the peer group to compare our performance to those companies against whom we compete each day, irrespective of the size of any peer company. As reported by Equilar, total direct compensation of $26,990,615 paid to our named executive officers as a group in 2014, the last year for which peer data is available, was approximately 50 percent of the average total compensation of $53,181,623 paid by companies in the peer group to their named executive officers as a group in the same year.

We believe that increasing compensation for our named executive officers to achieve a benchmark at or above the median of our peers would serve only to increase compensation expense without a corresponding benefit to shareholders that we cannot otherwise achieve with our current structure and approach to executive compensation. Our approach is to consider competitive compensation practices and relevant factors to influence appropriate changes to our executive compensation structure and levels over time. This approach provides us with flexibility in maintaining and enhancing our executive officers’ focus, motivation and enthusiasm for our future while controlling overall compensation expense. We believe our levels of compensation are competitively reasonable and appropriate for our business needs and circumstances.

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For similar reasons,

We do use the peer group to compare our performance to those companies against whom we do not benchmarkcompete each day, irrespective of the size of any peer company. We believe that it is important to link performance-based compensation to company performance compared with peers. Accordingly, the primary performance targets for our annual incentive compensation and PSUs are relative targets compared with our peer group. We also believe that linking the level of individual namedperformance-based awards to a percentage of base annual salary that is paid out according to a predetermined formula based upon achievement of performance goals for all of our executive officers with executives carrying similar titles across a peer group. unites the personal financial interests of the executive team, focusing its attention on achievement of performance goals designed to increase shareholder value over the long term.

The Committee reviews performance and compensation data of the peer group to gain a sense of whether we are providing generally competitive compensation for our named executive officers individually and as a group. Since 2012, ourBecause one of the companies in the 10 member peer group has consisted of 10 publicly traded companies:

used by the committee since 2012 was acquired by a non-U.S. insurer in early 2016, the Committee decreased the peer group to the remaining nine companies beginning with performance year 2016. The nine peer companies are:

The Allstate Corporation The Chubb Corporation Hanover Insurance Group Inc. Hartford Financial Services Group Inc. Markel Corporation	Selective Insurance Group Inc.	State Auto Financial Corporation The Travelers Companies Inc. United Fire Group Inc. W.R. Berkley Corporation

These 10nine U.S.-domiciled companies were selected because they generally market their products through the same types of independent insurance agencies that represent our company, and they provide both commercial lines and personal lines of insurance, as we do. We also included companies in the peer group that historically have followed an equity investment strategy similar to ours, or that offer life insurance products or surplus lines coverages.

Comparative performance and compensation data reviewed by the Committee suggests that the company’s executive compensation is not excessive as compared with performance and compensation levels of the peer group. As reported by Equilar, total direct compensation of $7,613,448 awarded to our named executive officers as a group in 2015, the last year for which peer data is available, was approximately 37 percent of the average total direct compensation of $20,768,233 awarded by companies in the peer group to their named executive officers as a group in the same year. The following table ranks the company and the 10nine companies in the peer group according to market capitalization at December 31, 2015,2016, and ranks three-year value creation ratio, three-year total shareholder returns as of December 31, 2015,2016, as reported by Bloomberg LP, and compensation data compiled by Equilar from our peers’ 2015the 2016 proxy statements filed by the peer group, the most recent year for which such data is available.

	Rank	Market Capitalization
Rank	Market Capitalization	Three-Year Value Creation Ratio	Three-Year Total Shareholder Return	Total Direct Compensation (from 20152016 Proxy Statements)
	1	Travelers	W.R. Berkley	United Fire	Travelers
2	Allstate	Selective	Selective	W.R. Berkley
3	Hartford	Cincinnati	W.R. Berkley	Hartford
4	Markel	Travelers	Hanover	Allstate
5	Cincinnati	United Fire	Cincinnati	Selective
6	W.R. Berkley	Markel	Markel	Hanover
7	Hanover	Hanover	Travelers	Markel
8	2	Chubb	Cincinnati	Hartford	W.R. Berkley
	3Selective	Allstate	SelectiveAllstate	Markel	Hartford	Cincinnati
	4	Hartford	Chubb9	United Fire	AllstateState Auto
	5	Markel	United Fire	Chubb	Chubb
	6	Cincinnati	Travelers	Selective	Markel
	7	W.R. Berkley	W.R. Berkley	Cincinnati	Hanover
	8	HanoverHartford	State Auto	Travelers	Selective
	9	Selective	Hanover	Allstate	Cincinnati
	10	United Fire	Allstate	W.R.Berkley	State Auto
	11	State Auto	Hartford	State Auto	United Fire

Compensation Consultants

The Committee does not employ compensation consultants for recommendations concerning executive compensation. Our targeted executive compensation levels arehistorically have been low compared with peers, in line with our tradition of keeping overall expenses low. Our compensation programs are not complex and, because we do not benchmark compensation to peers, the Committee does not believe it requires the services of a compensation consultant to assist with either administration of current plans or the determination of appropriate levels of compensation. The Committee will continue to monitor our compensation structure to ensure that the compensation it wishes to deliver to the executive team is delivered as appropriate, considering overall company and individual performance. The Committee does review and consider peer group performance and compensation data collected from the Equilar service and publicly available proxy statements and Form 10-K filings.

Tax Considerations

Section 162(m) limits to $1 million per year the federal income tax deduction to public corporations for compensation paid in any fiscal year to any individual who is identified as a named executive officer as of the end of the fiscal year in accordance with the Exchange Act. This limitation does not apply to qualifying “performance-based compensation”.compensation.” The Committee intends for our annual incentive compensation awards and PSUs (which permit the Committee to exercise negative

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discretion to reduce or eliminate payment of awards) to qualify for the performance-based compensation exception to the $1 million limitation. In addition, stock options are considered performance-based compensation that can qualify for the exception.

The Committee believes that our shareholders are best served by not restricting its discretion and flexibility in making compensation decisions about performance-based and nonperformance-based compensation, although some of these decisions may from time to time result in certain nondeductible compensation expenses. Accordingly, the Committee may from time to timeoccasionally approve compensation for certain named executive officers that is not fully deductible and reserves the right to do so in the future, in appropriate circumstances.

In 2015, nonperformance-based Moreover, despite the Committee's efforts to structure performance-based compensation for each of the named executive officers fell below the $1 millionin a manner intended to be exempt from Section 162(m) cap and is believedtherefore not subject to its deduction limits, because of ambiguities and uncertainties as to the application and interpretation of Section 162(m) and the regulations issued thereunder, no assurance can be fully deductible.

given that compensation the Committee intends to satisfy the requirements for exemption from Section 162(m) in fact will.

The Committee generally does not favor the payment of tax gross-ups. Except in limited circumstances, such as a retirement gift of nominal value or relocation assistance on the same basis offered to all retiring or relocating associates, the Committee has not authorized payment of tax gross-ups to executive officers.

Employment Agreements, Change in Control Provisions and

Post-Retirement Benefits

We do not have employment agreements with any of our named executive officers that specify a term of employment or guarantee minimum levels of bonuses or stock-based awards. All of our named executive officers are at-will employees. Our long-standing corporate perspective has been that employment contracts do not provide the company with any significant advantage. We believe our corporate culture, current compensation practices and levels of stock ownership by our executive officers have resulted in stability in our current 15-member13-member group of executive officers, who average 2623 years with the company.

In 2011, in connection with hiring Mr. Sewell as our chief financial officer, the Committee authorized a deferred compensation agreement between the company and Mr. Sewell designed to approximate the value of retirement benefits that he would forego at his former employer. Mr. Sewell is fully vested in

amounts payable under the agreement. No amounts are payable under the agreement until Mr. Sewell reaches the age of 58.

Change in control provisions are included in our 2016, 2012 and 2006 Stock Compensation Plans and our 2009 Annual Incentive Plan, and those provisions apply to all associates receiving awards under the plans, not just to executive officers. The change in control provisions in these plans contain a “double trigger”,trigger,” which requires both a change in control event, as defined in the plans, and termination of the associate’s employment due to the change in control within a specified time period. The double trigger ensures that we will become obligated to accelerate vesting of prior awards only if the associate is actually or constructively discharged because of the change in control event.

We occasionally provide post-retirement benefits to long-tenured, executive-officer-level associates who provide services to the company after retirement from their executive positions. These post-retirement benefits are intended to compensate the associate for ongoing services associated with maintaining continuity of relationships and providing guidance to their successors and other associates. In 2015,2016, we paid $34,036$12,398 for executive communicationaccounting and financial reporting consulting services to a retired executive officer.

Page 55

Summary Compensation Table

Name and Principal Position	Year	Salary ($)	Bonus ($) (1)	Stock Awards ($) (2) (4)	Option Awards ($) (3)	Nonequity Incentive Plan Compen- sation ($)	Change in Pension Value and Nonqualified Deferred Compensation Earnings ($) (5)		All Other Compensation ($) (8)(9)		Total Compensation ($)
Steven J. Johnston	2015	941,975	-	665,213	151,834	283,662	-		121,300		2,163,984
Chief Executive Officer	2014	922,846	-	473,132	131,132	927,000	-		169,697	0	2,623,807
and President	2013	884,615	-	586,858	126,852	1,800,000	-		103,632	0	3,501,957
Cincinnati Financial Corporation
Jacob F. Scherer, Jr.	2015	863,477	-	410,863	90,465	169,015	721,831	(6)	13,842		2,269,493
Chief Insurance Officer and	2014	845,942	-	325,573	90,151	552,338	766,538	(6)	24,761		2,605,303
Executive Vice President	2013	813,462	-	403,799	87,210	1,072,500	576,577	(6)	17,882		2,971,429
The Cincinnati Insurance Company
Michael J. Sewell	2015	769,279	-	365,735	80,599	150,577	-		86,508		1,452,698
Chief Financial Officer,	2014	753,658	-	289,770	80,321	492,083	-		113,129		1,728,961
Senior Vice President and Treasurer Cincinnati Financial Corporation	2013	729,615	-	400,591	77,693	955,500	-		83,302		2,246,701
Martin F. Hollenbeck	2015	633,539	-	301,914	66,437	124,122	-		71,004		1,197,016
Chief Investment Officer and Senior Vice President Cincinnati Financial Corporation	2014 2013	617,769 594,615	- -	238,082 293,810	65,887 63,426	403,650 780,000	- -		95,751 69,042		1,421,139 1,800,893
Charles P. Stoneburner II	2015	633,539	-	301,914	66,437	124,122	607,422	(7)	9,175		1,742,609
Senior Vice President	2014	617,769	-	238,082	65,887	403,650	635,249	(7)	14,064		1,974,701
The Cincinnati Insurance Company	2013	592,308	-	293,810	63,426	780,000	288,465	(7)	9,124		2,027,133

Name and Principal Position	Year	Salary ($)		Bonus ($) (1)	Stock Awards ($) (2)(4)		Option Awards ($) (3)		Non- equity Incentive Plan Compen- sation ($)		Change in Pension Value and Nonqualified Deferred Compen- sation Earnings ($) (5)				All Other Compen- sation ($) (8)(9)				Total Compen- sation ($)
Steven J. Johnston   Chief Executive Officer and President Cincinnati Financial Corporation	2016	960,814		—	917,696		155,459		2,121,792		—				94,142				4,249,903
	2015	941,975		—	665,213		151,834		283,662		—				121,300		—		2,163,984
	2014	922,846		—	473,132		131,132		927,000		—				169,697		—		2,623,807
Jacob F. Scherer, Jr.   Chief Insurance Officer and Executive Vice President The Cincinnati Insurance Company	2016	887,747		—	581,968		93,542		1,160,572		575,137		(6	)	19,200				3,318,166
	2015	863,477		—	410,863		90,465		169,015		721,831		(6	)	13,842				2,269,493
	2014	845,942		—	325,573		90,151		552,338		766,538		(6	)	24,761				2,605,303
Michael J. Sewell   Chief Financial Officer, Senior Vice President and Treasurer Cincinnati Financial Corporation	2016	784,665		—	513,159		82,525		1,023,925		—				71,520				2,475,794
	2015	769,279		—	365,735		80,599		150,577		—				86,508				1,452,698
	2014	753,658		—	289,770		80,321		492,083		—				113,129				1,728,961
Martin F. Hollenbeck Chief Investment Officer and Senior Vice President Cincinnati Financial Corporation	2016	646,808		—	423,473		68,033		844,032		—				59,884				2,042,230
	2015	633,539		—	301,914		66,437		124,122		—				71,004				1,197,016
	2014	617,769		—	238,082		65,887		403,650		—				95,751				1,421,139
Charles P. Stoneburner II  Senior Vice President The Cincinnati Insurance Company	2016	657,090		—	431,722		69,367		860,582		444,699		(7	)	13,533				2,476,993
	2015	633,539		—	301,914		66,437		124,122		607,422		(7	)	9,175				1,742,609
	2014	617,769		—	238,082		65,887		403,650		635,249		(7	)	14,064				1,974,701

(1)	Since 2010, the Committee has eliminated discretionary cash bonuses as a regular component of compensation for the named executive officers.

(2)

Amounts shown in the Stock Awards column reflect values for grants of PSUs, RSUs and Holiday Stock awards. PSUs are intended to be performance-based compensation for purposes of Section 162(m) and reflect the full grant date fair values in accordance with FASB ASC 718. Amounts for PSUs are computed using a Monte Carlo valuation on the date of grant. Amounts for RSUs reflect the full grant date fair value in accordance with FASB ASC 718. These amounts do not represent the actual value that may be realized by the named executive officers. For assumptions used in determining the values for awards of PSUs and RSUs, see our 20152016 Annual Report on Form 10-K, Part II, Item 8, Note 17, Page 152.160. Awards under the Holiday Stock Plan are valued at fair market value on the date of grant. The per share fair market values were $71.55, $59.81 $51.20 and $50.84$51.20 for the grant dates of November 11, 2016, November 13, 2015 and November 14, 2014, and November 15, 2013, respectively. There were no forfeitures of Holiday Stock or PSU or RSU awards by the named executive officers in 2016, 2015 2014 or 2013.2014.

(3)

Amounts in the Option Awards column reflect the value of awards for grants of nonqualified stock options. These nonqualified stock options are intended to be performance-based compensation for purposes of Section 162(m) and reflect the full grant date fair values in accordance with FASB ASC 718. These amounts do not represent the actual value, if any, that may be realized by the named executive officers. For assumptions used in calculation of option awards, see our 20152016 Annual Report on Form 10-K, Part II, Item 8, Note 17, Page 152.160. There were no forfeitures of option awards by the named executive officers in 2016, 2015 2014 or 2013.2014.

(4)	Maximum values of PSUs granted in 20152016 are: $1,241,387$1,652,933 for Mr. Johnston; $739,637$994,597 for Mr. Scherer; $658,969$877,453 for Mr. Sewell, and $543,181 each$723,369 for Messrs.Mr. Hollenbeck and $737,555 for Mr. Stoneburner.

Maximum values of PSUs granted in 2015 are: $1,241,387 for Mr. Johnston; $739,637 for Mr. Scherer; $658,969 for Mr. Sewell and $543,181 each for Messrs. Hollenbeck and Stoneburner.

Maximum values of PSUs granted in 2014 are: $945,651 for Mr. Johnston; $650,121 for Mr. Scherer; $579,232 for Mr. Sewell and $475,139 each for Messrs. Hollenbeck and Stoneburner.

Maximum values of PSUs granted in 2014 are: $945,651 for Mr. Johnston; $650,121 for Mr. Scherer; $579,232 for Mr. Sewell and $475,139 each for Messrs. Hollenbeck and Stoneburner.

Maximum values of PSUs granted in 2013 are: $1,173,208 for Mr. Johnston; $806,581 for Mr. Scherer; $718,554 for Mr. Sewell; and $586,604 each for Messrs. Hollenbeck and Stoneburner.

(5)

No above-market or preferential earnings were paid on deferred compensation. The amounts shown in this column represent the aggregate change in actuarial present value of accumulated pension benefits for those named executive officers participating in the company’s Retirement Plan and SERP for each of the years presented, using the same pension plan measurement date and assumptions used for financial reporting purposes. In addition to one year of service credit under the Retirement Plan and the SERP for Messrs. Scherer and Stoneburner, the changes in plan balances are primarily due to fluctuations in the applicable interest rate and discount rate used to actuarially calculate the accumulated benefit in each plan.

SERP for Messrs. Scherer and Stoneburner, the changes in plan balances are primarily due to fluctuations in the applicable interest rate and discount rate used to actuarially calculate the accumulated benefit in each plan.

(6)

For Mr. Scherer, in 2016 an increase of $169,439 in the Retirement Plan and an increase of $405,698 in the SERP; in 2015 an increase of $145,399 in the Retirement Plan and an increase of $576,432 in the SERP. InSERP; and in 2014 an increase of $206,948 in the Retirement Plan and an increase of $559,590 in the SERP as the company adjusted the lump sum factor in the calculation to reflect a projected rate at normal age of retirement and applied a discount rate to more fully capture all assumptions used in the company’s GAAP financial statements. In 2013,

(7)

For Mr. Stoneburner, in 2016 an increase of $129,381$165,781 in the Retirement Plan and an increase of $447,196$278,918 in the SERP. Had the discount rate and adjusted lump sum factor been applied to the calculations for 2013, the aggregate change in actuarial present value of accumulated retirement benefits for Mr. Scherer would have produced an increase in the Retirement Plan of $15,962 and an increase in the SERP of $204,237.

(7)

For Mr. Stoneburner,SERP; in 2015 an increase of $156,971 in the Retirement Plan and an increase of $450,451 in the SERP; and in 2014 an increase of $226,921 in the Retirement Plan and an increase of $408,328 in the SERP; and in 2013, an increase of $61,612 in the Retirement Plan and an increase of $226,853 in the SERP.

(8)

For Messrs. Johnston, Sewell, Hollenbeck and Stoneburner, includes perquisites in an aggregate amount less than $10,000 for one or more of the types described in Perquisites and Other Personal Benefits, Page 52.

(8)

For Mr. Scherer,Johnston, includes perquisites in the amount of $12,629,$17,099, which includes the incremental additional cost of $2,971$13,573 for spouse travel and meals for business events to which spouses are invited, club dues of $6,670, premiums paid for a personal

Page 56

umbrella liability insurance policy, in the amount of $1,861, executive tax services,club dues, personal use of a company car, a safe driver award and an executive health examination.

For Mr. Scherer, includes perquisites in the amount of $17,987, which includes the incremental additional cost of $7,862 for spouse travel and meals for business events to which spouses are invited, club dues of $6,735, premiums paid for a personal umbrella liability insurance policy, executive tax services, personal use of a company car, a safe driver award and an executive health examination.

For Mr. Sewell, includes perquisites in the amount of $13,397, which includes the incremental additional cost of $6,412 for spouse travel and meals for business events to which spouses are invited, premiums paid for a personal umbrella liability insurance policy in the amount of $2,156, executive tax services in the amount of $1,950, personal use of a company car valued at $2,621 and a safe driver award.

For Mr. Hollenbeck, includes perquisites in the amount of $12,395, which includes the incremental additional cost of $6,919 for spouse travel and meals for business events to which spouses are invited, premiums paid for a personal umbrella liability insurance policy in the amount of $1,293, personal use of a company car valued at $2,996, executive tax services, a safe driver award and an executive health examination.

For Mr. Stoneburner, includes perquisites in the amount of $11,664, which includes the incremental additional cost of $6,614 for spouse travel and meals for business events to which spouses are invited, executive tax services in the amount of $3,525, premiums paid for a personal umbrella liability policy, personal use of a company car, a safe driver award and an executive health examination.

(9)	Includes matching contributions to the company’s 401(k) and Top Hat Savings Plans in the amounts of $112,139$74,669 for Mr. Johnston, $75,682$56,115 for Mr. Sewell and $62,231$46,256 for Mr. Hollenbeck.

2015

2016 Grant of Plan-Based Awards (1)

Name	Grant Date		Estimated Possible Payouts Under Nonequity Incentive Plan Awards			Estimated Possible Payouts Under Equity Incentive Plan Awards			All Other Stock Awards: Number of Shares of Stock or Units (2)	All Other Option Awards: Number of Securities Under- lying Options	Exercise or Base Price of Option Awards	Grant Date Fair Value of Stock and Option Awards
			Threshold ($)	Target ($)	Maximum ($)	Threshold (#)	Target (#)	Maximum  (#)	(#)	(#)	($/Sh)	($)
Steven J. Johnston	2/13/2015	**								13,573	52.25	151,834
	2/13/2015	*	283,662	945,540	1,891,080
	2/13/2015	**				4,072	13,573	27,146				620,693
	2/13/2015	**							905			44,101
	11/13/2015	***							7			419
Jacob F. Scherer, Jr.	2/13/2015	**								8,087	52.25	90,465
	2/13/2015	*	169,015	563,384	1,126,768
	2/13/2015	**				2,427	8,087	16,174				369,819
	2/13/2015	**							830			40,446
	11/13/2015	***							10			598
Michael J. Sewell	2/13/2015	**								7,205	52.25	80,599
	2/13/2015	*	150,577	501,924	1,003,848
	2/13/2015	**				2,162	7,205	14,410				329,485
	2/13/2015	**							739			36,011
	11/13/2015	***							4			239
Martin F. Hollenbeck	2/13/2015	**								5,939	52.25	66,437
	2/13/2015	*	124,122	413,741	827,482
	2/13/2015	**				1,782	5,939	11,878				271,590
	2/13/2015	**							610			29,725
	11/13/2015	***							10			598
Charles P. Stoneburner  II	2/13/2015	**								5,939	52.25	66,437
	2/13/2015	*	124,122	413,741	827,482
	2/13/2015	**				1,782	5,939	11,878				271,590
	2/13/2015	**							610			29,725
	11/13/2015	***							10			598

Name	Grant Date		Estimated Possible Payouts Under Nonequity Incentive Plan Awards						Estimated Possible Payouts Under Equity Incentive Plan Awards						All Other Stock Awards: Number of Shares of Stock or Units (2)		All Other Option Awards: Number of Securities Under-lying Options		Exercise or Base Price of Option Awards		Grant Date Fair Value of Stock and Option Awards
			Threshold ($)		Target ($)		Maximum ($)		Threshold (#)		Target (#)		Maximum (#)		(#)		(#)		($/Sh)		($)
Mr. Johnston	2/12/2016	**															11,768		61.47		155,459
	2/12/2016	*	318,269		1,060,896		2,121,792
	2/12/2016	**							3,531		11,768		23,536								826,467
	2/12/2016	**													1,569						90,657
	11/11/2016	***													8						572
Mr. Scherer	2/12/2016	**															7,081		61.47		93,542
	2/12/2016	*	174,086		580,286		1,160,572
	2/12/2016	**							2,125		7,081		14,162								497,299
	2/12/2016	**													1,453						83,954
	11/11/2016	***													10						715
Mr. Sewell	2/12/2016	**															6,247		61.47		82,525
	2/12/2016	*	153,589		511,963		1,023,925
	2/12/2016	**							1,875		6,247		12,494								438,727
	2/12/2016	**													1,282						74,074
	11/11/2016	***													5						358
Mr. Hollenbeck	2/12/2016	**															5,150		61.47		68,033
	2/12/2016	*	126,605		422,016		844,032
	2/12/2016	**							1,545		5,150		10,300								361,685
	2/12/2016	**													1,057						61,073
	11/11/2016	***													10						715
Mr. Stoneburner	2/12/2016	**															5,251		61.47		69,367
	2/12/2016	*	129,087		430,291		860,582
	2/12/2016	**							1,576		5,251		10,502								368,778
	2/12/2016	**													1,077						62,229
	11/11/2016	***													10						715

*	Cincinnati Financial Corporation 2009 Incentive Compensation Plan

**	Cincinnati Financial Corporation 2012 Stock Compensation Plan

***	Holiday Stock Plan. See Long-Term Stock-Based Compensation, Page 47,49, for information about awards of shares under the Holiday Stock Plan.

(1)	No material modifications or repricing occurred with respect to any outstanding option or other stock-based award in 2015.2016.

(2)	The grant date fair value of shares awarded under the Holiday Stock Plan is 100 percent of the average of the high and low sales price on Nasdaq on the date of grant, which was $59.81$71.55 on November 13, 2015.11, 2016.

Total compensation for 2016 shown in the Summary Compensation Table, excluding attributions of compensation related to retirement plans, generally increased from 2015 levels because of achievement of maximum payouts of annual incentive compensation awards, rather than threshold payouts of annual incentive compensation received for 2015.

Total compensation for 2015 shown in the Summary Compensation Table, excluding attributions of compensation related to retirement plans, generally decreased from 2014 levels because of achievement of threshold payments of annual incentive compensation awards, rather than target payouts of annual compensation received for 2014.

Total compensation for 2014 shown in the Summary Compensation Table, excluding attributions of compensation related to retirement plans, generally decreased from 2013 levels because of a lower grant date fair value per share for stock-based compensation and achievement of target payouts of annual incentive compensation awards, rather than maximum payouts of annual incentive compensation received for 2013.

2014.

Amounts shown in the Salary column do not exactly match the base annual salaries set by the Committee for the year because of the timing of adjustments to base annual salary made in the respective years. The history of changes to base annual salaries for the named executive officers for the reported years is set forth below:

In February 2016, the Committee adjusted base salaries to $964,451 for Mr. Johnston; to $892,747 for Mr. Scherer; to $787,635 for Mr. Sewell; to $649,256 for Mr. Hollenbeck and to $661,986 for Mr. Stoneburner.

In February 2015, the Committee adjusted base salaries to $945,540 for Mr. Johnston; to $866,745 for Mr. Scherer; to $772,191 for Mr. Sewell; to $636,525 for Mr. Hollenbeck and to $636,525 for Mr. Stoneburner.

Page 57

In February 2014, the Committee adjusted base annual salaries to $927,000 for Mr. Johnston; to $849,750 for Mr. Scherer; to $757,050 for Mr. Sewell; to $621,000 for Mr. Hollenbeck and to $621,000 for Mr. Stoneburner.

In February 2013, the Committee adjusted base annual salaries to $900,000 for Mr. Johnston; to $825,000 for Mr. Scherer; to $735,000 for Mr. Sewell; to $600,000 for Mr. Hollenbeck and to $600,000 for Mr. Stoneburner.

Amounts shown in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column of the Summary Compensation Table represent the annual incremental changes in the present values of benefits under the company’s defined benefit and SERP plans. Changes in the balances of the Top Hat accounts of named executive officers due to their contributions and investment performance during the year are included in the All Other Compensation column of the Summary Compensation Table. For information about these plans, see Retirement Benefits, Page 51.

Page 58

53.

Outstanding Equity Awards at 20152016 Year End

	Option Awards    (1)					Stock Awards
Name	Number of Securities Underlying Unexercised Options Exercisable (#)	Number of Securities Underlying Unexercised Options Unexercisable (#)	Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($)	Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested (#) (2)	Market Value of Shares or Units of Stock That Have Not Vested ($)		Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (2)(3)	Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Steven J. Johnston	8,000			26.59	11/14/2018
	10,234			26.58	2/19/2020
	7,991			34.04	2/18/2021
	4,893			31.62	5/2/2021
	13,472			35.63	2/17/2022
	8,725	4,363		44.70	2/15/2023
									13,088	780,830
	4,291	8,582		46.81	2/14/2024
									12,873	768,003
		13,573		52.25	2/13/2025
									13,573	809,765
						905	53,992
Jacob F. Scherer, Jr.	7,500			44.79	1/31/2017
	8,000			37.59	2/18/2018
	8,933			34.04	2/18/2021
	664			31.62	5/2/2021
	10,262			35.63	2/17/2022
	5,999	2,999		44.70	2/15/2023
									8,998	536,821
	2,950	5,900		46.81	2/14/2024
									8,850	527,991
		8,087		52.25	2/13/2025
									8,087	482,470
						830	49,518
Michael J. Sewell	10,021			30.27	5/31/2021
	9,578			35.63	2/17/2022
						1,028	61,330
	5,344	2,672		44.70	2/15/2023
									8,016	478,235
	2,629	5,256		46.81	2/14/2024
									7,885	470,419
		7,205		52.25	2/13/2025
									7,205	429,850
						739	44,089
Martin F. Hollenbeck	2,000			44.79	1/31/2017
	2,250			37.59	2/18/2018
	6,621			34.04	2/18/2021
	7,731			35.63	2/17/2022
	4,363	2,181		44.70	2/15/2023
									6,544	390,415
	2,156	4,312		46.81	2/14/2024
									6,468	385,881
		5,939		52.25	2/13/2025
									5,939	354,321
						610	36,393
Charles P. Stoneburner  II	2,000			44.79	1/31/2017
	8,577			26.58	2/19/2020
	6,698			34.04	2/18/2021
	7,526			35.63	2/17/2022
	4,363	2,181		44.70	2/15/2023
									6,544	390,415
	2,156	4,312		46.81	2/14/2024
									6,468	385,881
		5,939		52.25	2/13/2025
									5,939	354,321
						610	36,393

	Option Awards (1)								Stock Awards
Name	Number of Securities Underlying Unexercised Options Exercisable (#)		Number of Securities Underlying Unexercised Options Unexercis- able (#)		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($)		Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested (#) (3)		Market Value of Shares or Units of Stock That Have Not Vested ($)			Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (2)(3)(4)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Mr. Johnston	10,234					26.58		2/19/2020
	7,991					34.04		2/18/2021
	4,893					31.62		5/2/2021
	13,472					35.63		2/17/2022
	13,088					44.70		2/15/2023
														12,873		975,258
	8,582		4,291			46.81		2/14/2024
														13,573		1,028,290
	4,525		9,048			52.25		2/13/2025
									603		45,683			11,768		891,544
	—		11,768			61.47		2/12/2026
									1,569		118,867
Mr. Scherer	8,000					37.59		2/18/2018
	8,933					34.04		2/18/2021
	664					31.62		5/2/2021
	10,262					35.63		2/17/2022
	8,998					44.70		2/15/2023
														8,850		670,476
	5,900		2,950			46.81		2/14/2024
														8,087		612,671
	2,696		5,391			52.25		2/13/2025
									553		41,895			7,081		536,457
			7,081			61.47		2/12/2026
									1,453		110,079
Mr. Sewell	9,578					35.63		2/17/2022
	8,016					44.70		2/15/2023
														7,885		597,368
	5,257		2,628			46.81		2/14/2024
														7,205		545,851
	2,402		4,803			52.25		2/13/2025
									492		37,274			6,247		473,273
	—		6,247			61.47		2/12/2026
									1,282		97,124

	Option Awards (1)								Stock Awards
Name	Number of Securities Underlying Unexercised Options Exercisable (#)		Number of Securities Underlying Unexercised Options Unexercis- able (#)		Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#)	Option Exercise Price ($)		Option Expiration Date	Number of Shares or Units of Stock That Have Not Vested (#) (3)		Market Value of Shares or Units of Stock That Have Not Vested ($)			Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) (2)(3)(4)		Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)
Mr. Hollenbeck	6,621					34.04		2/18/2021
	7,731					35.63		2/17/2022
	6,544					44.70		2/15/2023
														6,468		490,016
	4,312		2,156			46.81		2/14/2024
														5,939		449,939
	1,980		3,959			52.25		2/13/2025
									406		30,759			5,150		390,164
	—		5,150			61.47		2/12/2026
									1,057		80,078
Mr. Stoneburner	8,577					26.58		2/19/2020
	6,698					34.04		2/18/2021
	7,526					35.63		2/17/2022
	6,544		—			44.70		2/15/2023
	4,312		2,156			46.81		2/14/2024						6,468		490,016
	1,980		3,959			52.25		2/13/2025						5,939		449,939
									406		30,759
	—		5,251			61.47		2/12/2026						5,251		397,816
									1,077		81,594

(1)	One-third of each option award vests and becomes exercisable on the first, second and third anniversaries of the grant, provided the associate remains continuously employed with the company or its subsidiaries. The vesting date of each option is listed in the table below:

Page 59

Grant Date					Vesting Dates			Expiration Date
1/31/2007	1/31/2008	1/31/2009	1/31/2010	1/31/2017
Grant Date	Vesting Dates			Expiration Date
2/18/2008	2/18/2009	2/18/2010	2/18/2011	2/18/2018
7/1/2008	7/1/2009	7/1/2010	7/1/2011	7/1/2018
11/14/2008	11/14/2009	11/14/2010	11/14/2011	11/14/2018
2/19/2010	2/19/2011	2/19/2012	2/19/2013	2/19/2020
2/18/2011	2/18//2012	2/18//2013	2/18//2014	2/18//2021
5/2/2011	5/2/2012	5/2/2013	5/2/2014	5/2/2021
5/31/2011	5/31/2012	5/31/2013	5/31/2014	5/31/2021
2/17/2012	2/17/2013	2/17/2014	2/17/2015	2/17/2022
2/15/2013	2/15/2014	2/15/2015	2/15/2016	2/15/2023
2/14/2014	2/14/2015	2/14/2016	2/14/2017	2/14/2024
2/13/2015	2/13/2016	2/13/2017	2/13/2018	2/13/2025
2/12/2016	2/12/2017	2/12/2018	2/12/2019	2/12/2026

(2)	PSUs granted on February 14, 2014, will vestvested on March 1, 2017, ifat the target payout level based upon the achievement company-level performance targets are achieved.objectives.

(3)	One-third of the RSUs granted on February 13, 2015, vested on March 1, 2016.2016, another one-third vested on March 1, 2017, and the final one-third is scheduled to vest on March 1, 2018. PSUs granted on February 13, 2015, will vest on March 1, 2018, if the company-level performance targets are achieved.

2015

(4)	One-third of the RSUs granted on February 12, 2016, vested on March 1, 2017, another one-third is scheduled to vest on March 1, 2018, and the final one-third is scheduled to vest on March 1, 2019. PSUs granted on February 12, 2016, will vest on March 1, 2019, if the company-level performance targets are achieved.

2016 Option Exercises and Stock Vested

	Option Awards		Stock Awards
Name	Number of Shares Acquired on Exercise (#)	Value Realized on Exercise ($)	Number of Shares Acquired on Vesting (#)	Value Realized on Vesting ($)
Steven J. Johnston	-	-	13,472	710,379
Jacob F. Scherer, Jr.	15,000	231,150	10,262	541,115
Michael J. Sewell	-	-	9,578	505,048
Martin F. Hollenbeck	4,000	37,560	7,731	407,656
Charles P. Stoneburner II	4,000	63,880	7,526	396,846

2015

	Option Awards				Stock Awards
Name	Number of Shares Acquired on Exercise (#)		Value Realized on Exercise ($)		Number of Shares Acquired on Vesting (#)		Value Realized on Vesting ($)
Mr. Johnston	8,000		359,920		4,229		269,472
Mr. Scherer	7,500		241,575		2,977		189,694
Mr. Sewell	10,021		384,506		3,680		232,670
Mr. Hollenbeck	4,250		119,330		2,168		138,145
Mr. Stoneburner	2,000		55,200		2,168		138,145

2016 Pension Benefits

Name	Plan Name	Number of Years Credited Service (#)	Present Value of Accumulated Benefit  ($) (1)
Steven J. Johnston (2)	Qualified Pension Plan	n/a	-
	Supplemental Retirement Plan	n/a	-
Jacob F. Scherer, Jr. (3)	Qualified Pension Plan	32	1,171,207
	Supplemental Retirement Plan	32	2,457,520
Michael J. Sewell (2)	Qualified Pension Plan	n/a	-
	Supplemental Retirement Plan	n/a	-
Martin F. Hollenbeck (2)	Qualified Pension Plan	n/a	-
	Supplemental Retirement Plan	n/a	-
Charles P. Stoneburner II (3)	Qualified Pension Plan	35	1,298,900
	Supplemental Retirement Plan	35	1,630,271

Name	Plan Name	Number of Years Credited Service (#)	Present Value of Accumulated Benefit ($) (1)
Mr. Johnston (2)	Qualified Pension Plan	n/a	—
	Supplemental Retirement Plan	n/a	—
Mr. Scherer (3)	Qualified Pension Plan	33	1,340,646
	Supplemental Retirement Plan	33	2,863,218
Mr. Sewell (2)	Qualified Pension Plan	n/a	—
	Supplemental Retirement Plan	n/a	—
Mr. Hollenbeck (2)	Qualified Pension Plan	n/a	—
	Supplemental Retirement Plan	n/a	—
Mr. Stoneburner (3)	Qualified Pension Plan	36	1,464,681
	Supplemental Retirement Plan	36	1,909,189

(1)

Amounts listed in the “Present Value of Accumulated Benefit” column were calculated as of December 31, 2015,2016, using the same actuarial assumptions used by the company for GAAP financial reporting purposes and assuming that benefits commence at age 65. The assumptions include a lump-sum factor of 1.51.25 percent for both plans and a discount rate of 4.554.30 percent in the Qualified Pension Plan and 4.304.10 percent in the Supplemental Retirement Plan.

(2)	Messrs. Johnston and Sewell joined the company after entry into the qualified pension plan was closed. Mr. Hollenbeck elected to leave the retirement plans in 2008 in connection with changes to the plans.

(3)	At December 31, 2015,2016, Messrs. Scherer and Stoneburner had reached the early retirement age under both plans.

Tax-qualified defined benefit pension planplan.. The Cincinnati Financial Corporation Retirement Plan (Retirement Plan) is a tax-qualified defined benefit pension plan available to all full-time associates ages 40 and over on August 31, 2008, who elected to remain in the plan effective September 1, 2008. Members who were actively employed by the company on June 30, 2008, became fully vested in their accrued benefit. The Retirement Plan is closed to new members. Members of the Retirement Plan earn one year of service for each calendar year in which they work at least 1,000 hours. Members also earn service for time that they are paid, or entitled to be paid, but do not actually work. These times include vacation, holidays, illness, military duty and some periods of disability. Generally, the maximum amount of service that may be earned under the Retirement Plan is 40 years. The only exception is that 50 years of service may be earned by members who were employees of our former subsidiary, Inter-Ocean Insurance Company on or before February 23, 1973. There are no deductions for Social Security or other offset amounts.

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The Retirement Plan defines earnings for any given plan year as the base rate of salary in effect on the last day of the plan year, subject to the maximum recognizable compensation under Section 401(a)(17) of the Internal Revenue Code. Bonuses, stock-based awards and other forms of compensation do not contribute to earnings under the Retirement Plan.

Normal retirement age as defined in the Retirement Plan is age 65. The normal retirement pension is computed as a single life annuity. The normal monthly benefit payment is the greatest of the following three calculated amounts:

The first calculated amount is the sum of:

1.	0.45 percent of the member’s average monthly earnings plus 1.35 percent of the member’s average monthly earnings up to $2,916.67; multiplied by years of service up to 15 years, plus

2.	0.6 percent of the members’member's average monthly earnings plus 1.8 percent of the member’s average monthly earnings up to $2,916.67; multiplied by years of service between 16 and 40.

The second calculated amount is the sum of:

1.	0.9 percent of the member’s final average earnings; multiplied by years of service up to 15 years, plus

2.	1.2 percent of the member’s final average earnings; multiplied by years of service between 16 and 40.

The third calculated amount applies only to employees originally hired by our former subsidiary, Inter-Ocean Insurance Company, and is calculated as 1.0 percent of the member’s final average earnings multiplied by years of service not in excess of 50 years.

The normal form of benefit payment under the terms of the Retirement Plan is a single life annuity for unmarried members and a joint and 50 percent survivor annuity for married members. The plan permits members to elect to receive payment of benefits in the following forms:

·

Single life only

·

Single life only with 60-month or 120-month guarantee

·

Joint and 50 percent contingent annuity

·

Joint and 66.67 percent contingent annuity

·

Joint and 75 percent contingent annuity

·

Joint and 100 percent contingent annuity

·

Lump sum

Single life only

Single life only with 60-month or 120-month guarantee

Joint and 50 percent contingent annuity

Joint and 66.67 percent contingent annuity

Joint and 75 percent contingent annuity

Joint and 100 percent contingent annuity

Lump sum

Alternative forms of benefit payment are offered to provide plan members some flexibility in retirement income and estate planning by giving them the option of electing monthly benefits with or without a survivor’s benefit. Generally, the single life annuity alternative provides the largest monthly benefit but does not provide a survivor’s benefit. All other payment forms are the actuarial equivalent of a single life annuity. Alternatives other than the single life annuity provide slightly lower monthly benefits to the plan member, depending on such factors as presence of survivor’s benefit, the member’s age and any contingent annuitant’s age. The lump sum payment permits plan members to roll the present value of their benefit into an Individual Retirement Account and defer income taxes until the member withdraws funds from that account.

Supplemental retirement plan. The second retirement plan in which some named executive officers participate is the Cincinnati Financial Corporation Supplemental Retirement Plan (SERP). The SERP is unfunded and subject to forfeiture in the event of bankruptcy.

The SERP is a nontax-qualified defined benefit plan maintained by the company to pay eligible associates the difference between the amount payable under the tax-qualified defined benefit plan and the amount they would have received without the tax-qualified plan’s limit due to Section 401(a)(17) and Section 415 of the Internal Revenue Code. Accordingly, the SERP definitions for service, normal retirement age and annual earnings are the same as those for the Retirement Plan except the SERP’s definition of annual earnings is not limited.

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The normal retirement benefit under the SERP for the participating named executive officers will be equal to the excess of the member’s monthly benefit under the Retirement Plan as of the member’s retirement date, without regard to the limit on earnings under Section 401(a)(17) of the Internal Revenue Code and without regard to any limit on benefits under Section 415 of the Internal Revenue Code. The pension benefit under the SERP is payable only in the form of a single lump sum.

Both retirement plans permit early retirement, provided the member has at least five years of service. Benefits for early retirement are calculated by adjusting for life expectancy and reducing the benefit payable at age 65 by 0.5 percent per month for each month prior to age 65 that the member elects to begin receiving pension benefits. For example, a member who elects to retire at age 60 would receive 70 percent (60 months X 0.5 percent = 30 percent reduction) of the life-expectancy adjusted benefit payable at age 65.

Actuarial work related to both the Retirement Plan and SERP is performed by Willis Towers Watson, which provides human resource strategy, design and management; actuarial and management consulting to the financial services industry; and reinsurance intermediary services. The Committee engaged Willis Towers Watson to provide actuarial and consultative services related to the design of the company’s retirement and employee benefit plans.

2015

2016 Nonqualified Deferred Compensation Plan (1) (2)

Name	Aggregate Balance at 2014 Year-End	Executive Contributions in 2015	Registrant Contributions in 2015	Aggregate Earnings in 2015	Aggregate Balance at 2015 Year-End
	($)	($) (3)	($) (4)	($)	($) (5)
Steven J. Johnston	3,630,059	103,582	96,239	725,494	4,555,374
Jacob F. Scherer, Jr.	1,348,393	431,739	-	(60,757)	1,719,375
Michael J. Sewell	1,138,458	322,945	59,782	143,552	1,664,737
Martin F. Hollenbeck	721,830	46,331	46,331	35,147	849,639
Charles P. Stoneburner II	248	-	-	8	256

Name	Aggregate Balance at 2015 Year-End		Executive Contributions in 2016		Registrant Contributions in 2016		Aggregate Earnings in 2016		Aggregate Balance at 2016 Year-End
	($)		($) (3)		($) (4)		($) (6)		($) (5)
Mr. Johnston	4,555,374		74,669		58,769		1,458,439		6,147,250
Mr. Scherer	1,719,375		—		—		173,106		1,892,481
Mr. Sewell	1,664,737		67,462		40,215		260,799		2,033,212
Mr. Hollenbeck	849,639		30,356		30,356		127,477		1,037,827
Mr. Stoneburner	256		—		—		10		266

(1)	Prior to 2009 the company did not contribute to the Top Hat Savings Plan.

(2)	No withdrawals or distributions occurred in 2015.2016.

(3)	The named executive officers’ contributions shown in this column are also reported in the Summary Compensation Table in the salary column, and included in the amounts shown for total compensation.

(4)	The amounts shown in this column reflect the company’s match of the eligible named executive officer’s contributions, up to 6 percent of the portion of their cash compensation that exceeds $260,000.$265,000.

(5)	Of the amounts shown in this column, $2,706,343;$2,781,012; $675,084; $871,370; $191,855$938,832; $222,211 and $0 for Messrs. Johnston, Scherer, Sewell, Hollenbeck and Stoneburner respectively, were reported in the Summary Compensation Table in prior years.

(6)	Aggregate earnings in 2016 for Messrs. Johnston, Sewell and Hollenbeck were benefitted by significant investment allocations of their plan balances and contributions to the company's stock which delivered total shareholder return of 31.5 percent for the year ended December 31, 2016.

Defined contribution plans. The company sponsors a tax-qualified 401(k) savings plan for all associates as well as the Cincinnati Financial Corporation Top Hat Savings Plan, a deferred compensation plan for a select group of management or certain highly compensated associates. Fidelity Management Trust Company is the third-party administrator of the company’s defined contribution plans. The company made no cash contributions to the 401(k) or Top Hat plans until September 2008. In connection with Retirement Plan changes effective September 1, 2008, the company began to match contributions to the 401(k) plan made by associates who are not members of the Retirement Plan, up to a maximum of 6 percent of the associate’s annual cash compensation (salary and annual incentive compensation award). Participants in the Top Hat Savings Plan do not receive a matching contribution from the company unless their compensation level exceeds the maximum recognizable compensation under Section 401(a)(17) of the Internal Revenue Code, which for 20152016 was $265,000. Contributions made by associates immediately vest, while company matching contributions vest after three years of service. Messrs. Johnston, Sewell and Hollenbeck participate in these defined contribution plans and receive company matches of contributions made in each up to the 6 percent maximum. Messrs. Scherer and Stoneburner also participate in these plans, but they do not receive the company match because they are participants in the defined benefit Retirement Plan and SERP.

Compensation payable to the named executive officers may be deferred pursuant to the Top Hat Savings Plan. Under the Top Hat Savings Plan, highly compensated individuals as defined by the plan, including the named executive officers, may elect to defer a percentage of salary, any discretionary bonus and any annual incentive compensation, less the required withholdings.

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Deferral elections are made before the plan year for which compensation is to be deferred and are effective for the entire year. These elections generally may not be modified or terminated for that year. Compensation deferred by the named executive officer is credited to the individual’s deferred compensation account maintained by the company.

Beginning in 2008, in connection with the company’s redesign of our retirement benefit plans, we amended the Top Hat Savings Plan to eliminate the prior cap on the amount of salary that may be deferred and to permit company matching contributions for certain officers who have contributed to and received the maximum company match allowable in their 401(k) accounts, yet due to tax law limitations, are unable to receive a matching contribution for the compensation that exceeds the limit imposed on tax-qualified 401(k) plans. We do not otherwise contribute to or match contributions to this plan. Participants are prohibited from borrowing or pledging amounts credited to their accounts. Under the defined contribution plans, individuals choose one or more of several specified investment alternatives, including an alternative for Cincinnati Financial Corporation common stock. Earnings credited to the participant’s account are calculated based on the performance of the applicable investment choice(s) selected by the participant. We do not guarantee any level of return on contributions to the Top Hat Savings Plan.

Distributions from the Top Hat Savings Plan are made as soon as legally and administratively feasible after retirement, other separation from service or death, or pursuant to a qualified domestic relations order. Distributions to the named executive officers due to retirement or other separation of service are not permitted until the earlier of 180 days after employment terminates or death. Other than distributions pursuant to qualified domestic relations orders, distributions are made in the form of either a single lump-sum payment or monthly installments of not less than 12 months or more than 120 months, depending upon the participant’s prior election. To the extent that a participant chooses to have earnings credited based on the Cincinnati Financial Corporation common stock election, the participant may choose to receive any benefit payments in the form of stock. All other distributions are made in cash.

Potential Payments Upon Termination or Change of Control

We do not have employment contracts or severance plans applicable to any of our named executive officers. Assuming a termination of employment on December 31, 2015,2016, amounts the named executive officer would receive are governed by the terms of our qualified and nonqualified defined benefit and defined contribution plans, the 2006 and 2012 Stock Compensation Plansour various stock compensation plans and the 2009 Annual Incentive Compensation Plan. Generally, upon termination of employment for any reason, the named executive officer would be entitled to receive the balance of the Top Hat Savings Plan account disclosed in the Aggregated Balance at 20152016 Year-End column of the 20152016 Nonqualified Deferred Compensation Plan table. Additionally, individual named executive officers would be entitled to receive the amounts set forth in the table below, depending on age and the nature of the termination.

Potential Payments Upon Termination

Name		Top Hat Savings Plan	Retirement Plan	SERP	Stock-Based Awards			Annual Incentive Compensation
					Retirement	Retirement with Disability	Change in Control	Retirement	Retirement with Disability	Change in Control
		($)	($)	($)	($)	($)	($)	($)	($)	($)
Steven J. Johnston	(1)	4,555,374	-	-	-	3,756,000	3,756,000	-	945,540	945,540
Jacob F. Scherer, Jr.	(2)	1,719,375	1,277,718	2,668,806	-	1,879,234	1,879,234	-	563,384	563,384
Michael J. Sewell	(1)	1,664,737	-	-	-	1,735,044	1,735,044	-	501,924	501,924
Martin F. Hollenbeck	(3)	849,639	-	-	-	1,373,158	1,373,158	-	413,741	413,741
Charles P. Stoneburner II	(2)	256	1,416,588	1,769,888	1,066,066	1,373,158	1,373,158	124,122	413,741	413,741

Name		Top Hat Savings Plan		Retirement Plan		SERP		Stock-Based Awards						Annual Incentive Compensation
								Retirement		Retirement with Disability		Change in Control		Retirement		Retirement with Disability		Change in Control
		($)		($)		($)		($)		($)		($)		($)		($)		($)
Mr. Johnston	(1)	6,147,250		—		—		—		3,918,797		3,918,797		—		2,121,792		2,121,792
Mr. Scherer	(2)	1,892,481		1,345,156		2,918,718		—		2,518,598		2,518,598		—		1,160,572		1,160,572
Mr. Sewell	(1)	2,033,212		—		—		—		2,237,375		2,237,375		—		1,023,925		1,023,925
Mr. Hollenbeck	(3)	1,037,827		—		—		—		1,841,057		1,841,057		—		844,032		844,032
Mr. Stoneburner	(2)	266		1,486,338		1,933,958		1,739,328		1,851,665		1,851,665		860,582		860,582		860,582

(1)

Messrs. Johnston and Sewell were hired after entry into the defined benefit pension plan was closed and, therefore, were never members of the pension plan or the SERP. If either retired due to a disability or terminated employment because of change of control, he would receive accelerated vesting of certain outstanding stock-based awards under the 2006 and 2012 Stock Compensation Plans, plus target levels of any outstanding annual incentive compensation award.

(2)

Messrs. Scherer and Stoneburner are eligible for early retirement under the defined benefit pension plan and SERP. If either retired due to a disability or terminated employment because of change of control, he would receive accelerated vesting at target levels of certain outstanding stock-based awards under the 2006 and 2012 Stock Compensation Plans and outstanding awards of annual incentive compensation under the 2009 Annual Incentive Plan. For any other termination of employment, Mr. Scherer would not receive accelerated vesting of such awards because he has not attained age 65 and has not been

Page 63

employed with the company for 35 years. Because Mr. Stoneburner has been employed by the company for overmore than 35 years, for purposes of plan awards any other termination of employment would be treated as a retirement and Mr. Stoneburner would receive accelerated vesting of certain outstanding stock-based awards under the 2006 and 2012 Stock Compensation Plans and outstanding annual incentive compensation awards under the 2009 Annual Incentive Plan at levels determined by company performance. The amount shown for Mr. Stoneburner includes thresholdmaximum and target values of performanceannual incentive compensation and stock based awards, forrespectively, performance periods ending December 31, 2015,2016, and target levels for performance-based stock awards with performance periods ending after December 31, 2015.2016.

(3)

Mr. Hollenbeck elected to leave the defined benefit plan in 2008, in connection with the company’s restructuring of its retirement benefits. If he retired due to a disability or terminated employment because of change of control, he would receive accelerated vesting of certain outstanding stock-based awards under the 2006 and 2012 Stock Compensation Plans and outstanding annual incentive compensation awards at levels determined by company performance. For any other termination of employment, he would not receive accelerated vesting of such awards because he has not attained age 65 and has not been employed with the company for 35 years.

2015

2016 Director Compensation (1)

Name	Fees Earned or Paid in Cash ($)	Stock Awards ($) (3)(4)	Option Awards ($) (5)	Non-Equity Incentive Plan Compen- sation ($)	Change in Pension Value and Non- qualified Deferred Compensation Earnings ($) (6)	All Other Compensation ($) (7)		Total ($)
William F. Bahl	159,000	100,021	-	-	-	6,119		265,140
Gregory T. Bier	109,000	100,021	-	-	-	4,620		213,641
Linda Clement-Holmes	70,000	70,009	-	-	-	1,380		141,389
Dirk J. Debbink	71,500	71,507	-	-	-	5,327		148,335
Kenneth C. Lichtendahl	70,000	70,009	-	-	-	1,539		141,548
W. Rodney McMullen	120,500	100,021	-	-	-	4,790		225,311
David P. Osborn	101,500	100,021	-	-	-	5,467		206,989
Gretchen W. Price	86,000	76,001	-	-	-	5,311		167,312
John J. Schiff, Jr. (2)	-	598	-	-	543,881	62,046		606,525
Thomas R. Schiff	97,000	97,026	-	-	-	4,046		198,072
Douglas S. Skidmore	70,000	70,009	-	-	-	5,332		145,341
Kenneth W. Stecher (2)	-	315,981	70,855	132,376	1,060,724	559,118		2,139,054
John F. Steele, Jr.	86,500	86,541	-	-	-	5,058		178,099
Larry R. Webb	104,500	100,021	-	-	-	12,882		217,403

Name	Fees Earned or Paid in Cash ($)		Stock Awards ($) (3)(4)		Option Awards ($) (5)		Non-equity Incentive Plan Compen- sation ($)		Change in Pension Value and Non-qualified Deferred Compen- sation Earnings ($) (6)		All Other Compen- sation ($) (7)			Total ($)
William F. Bahl	162,000		100,018		—		—		—		14,054			276,072
Gregory T. Bier	112,000		100,018		—		—		—		11,366			223,384
Linda Clement-Holmes	74,500		74,553		—		—		—		2,196			151,249
Dirk J. Debbink	76,000		76,042		—		—		—		12,195			164,237
Kenneth C. Lichtendahl	74,500		74,553		—		—		—		11,681			160,734
W. Rodney McMullen	123,500		100,018		—		—		—		12,195			235,713
David P. Osborn	104,500		100,018		—		—		—		12,074			216,592
Gretchen W. Price	92,000		82,001		—		—		—		1,066			175,067
John J. Schiff, Jr. (2)	—		715		—		—		79,235		41,285			121,235
Thomas R. Schiff	98,500		98,529		—		—		—		1,568			198,597
Douglas S. Skidmore	73,000		73,063		—		—		—		12,618			158,681
Kenneth W. Stecher (2)	—		439,345		72,551		900,154		449,591		568,063			2,429,704
John F. Steele, Jr.	88,000		88,030		—		—		—		11,751			187,781
Larry R. Webb	107,500		100,018		—		—		—		19,919			227,437

(1)	Mr. Johnston is a director and the chief executive officer and president of the company. Compensation for Mr. Johnston is shown in the Summary Compensation Table and supporting disclosure beginning on Page 56.60. Mr. Johnston receives no additional compensation for his service as a director.

(2)

Mr. J. Schiff, Jr. is a director and an employee of the company and until January 27, 2017, also is thewas a director and chairman of the executive Committees and an employeecommittees of the company’s insurance subsidiaries. Mr. Stecher is chairman of the board and until January 31, 2017, an executive officer of the company. In 2016, Messrs. Schiff and Stecher receivereceived no additional compensation for their service as directors.

(3)

Stock awards for nonemployee directors under the Directors Stock Plan of 2009 were valued at full fair market value determined by the average of the high and low sales price on Nasdaq on January 28, 2016,26, 2017, the date of grant, times the number of shares awarded. The per share fair market value on January 28, 2016,26, 2017, was $55.475.$70.94 . The number of shares granted to directors reported in this column were: 1,8031,410 to Mr. Bahl; 1,8031,410 to Mr. Bier; 1,2621,051 to Ms. Clement-Holmes; 1,2891,072 to Mr. Debbink; 1,2621,051 to Mr. Lichtendahl; 1,8031,410 to Mr. McMullen; 1,8031,410 to Mr. Osborn; 1,3701,156 to Ms. Price; 1,7491,389 to Mr. T. Schiff; 1,2621,030 to Mr. Skidmore; 1,5601,241 to Mr. SteeleSteele; and 1,8031,410 to Mr. Webb

(4)

The amount included in the Stock Awards column for Mr. Stecher reflects the value of PSUs, RSUs and Holiday Stock awards, if any. The amount shown for PSUs reflects the full grant date fair value in accordance with FASB ASC 718 using a Monte Carlo valuation on the date of grant. Amounts for RSUs reflect the full grant date fair value in accordance with FASB ASC 718. These amounts do not represent the actual value that may be realized by Mr. Stecher. For assumptions used in determining these values, see our 20152016 Annual Report on Form 10-K, Part II, Item 8, Note 17, Page 152.160. The maximum attainable value from the PSUs awarded to Mr. Stecher is $579,308.$771,406. Mr. J. Schiff, Jr. declined any award of RSUs or PSUs in 2015.2016. Awards under the Holiday Stock Plan are valued at full market value, determined by the average of the high and low sales price on Nasdaq on the date of grant, multiplied by the number of shares. On November 13, 2015,11, 2016, Messrs. J. Schiff, Jr. and Stecher were each granted 10 shares under this plan with a per share grant date fair market value of $59.81.$71.55. Nonemployee directors are not eligible to receive RSUs, PSUs or shares under the Holiday Stock Plan.

(5)

The amount in the Option Awards column reflects the value of grants of nonqualified stock options. The amount shown for nonqualified stock options reflects the full grant date fair value in accordance with FASB ASC 718. For assumptions used in calculation of option awards, see our 20152016 Annual Report on Form 10-K, Part II, Item 8, Note 17, Page 152.160. This amount does not represent the actual value, if any, that may be realized by Mr. Stecher. Mr. J. Schiff, Jr. declined any award of nonqualified stock options in 2015.2016. Nonemployee directors are not eligible to receive stock options under current company stock compensation plans.

Page 64

(6)

No preferential earnings were paid on deferred compensation in 2015.2016. Amounts in this column reflect changes in values of the actuarially calculated accumulated benefit for Mr. Stecher in the Retirement Plan and for Messrs. Stecher and J. Schiff, Jr. in the company’s SERP. In 2015,2016, Mr. Stecher’s accumulated benefits in the Retirement Plan and SERP increased $308,267$143,487 and $752,457,$306,104, respectively. Mr. Schiff’s accumulated benefit in the SERP increased $543,881.$79,235.

(7)	For Mr. J. Schiff, Jr., includes salary of $55,769.$37,500.

For Mr. Stecher, includes salary of $549,485.

For Mdmes. Price and Clement-Holmes and Messrs. Bahl, Bier, Debbink, Lichtendahl, McMullen, Osborn, J. Schiff, Jr., T. Schiff, Skidmore, Stecher and Steele, amounts shown in this column reflect perquisites in an aggregate amount less than $10,000 for one or more of the types described in Perquisites and Other Personal Benefits, Page 52.

For Mr. Webb, includes perquisites in an aggregate amount of $12,607, which amount includes the incremental additional cost of $3,063 for spouse travel and meals for business events to which spouses are invited and premiums of $9,544 paid for a personal umbrella liability insurance policy.

For Mr. Stecher, includes salary of $560,475.

For Mdmes. Price and Clement-Holmes and Messrs. J. Schiff, Jr., T. Schiff, and Stecher, amounts shown in this column reflect perquisites in an aggregate amount less than $10,000 for one or more of the types described in Perquisites and Other Personal Benefits, Page 54.

For Mr. Bahl, includes perquisites in an aggregate amount of $13,779, which includes the incremental additional cost of $11,263 for spouse travel and meals for business events to which spouses are invited and $2,516 for premiums paid for a personal umbrella liability policy.

For Mr. Bier, includes perquisites in an aggregate amount of $11,091, which includes the incremental additional cost of $9,802 for spouse travel and meals for business events to which spouses are invited and $1,289 for premiums paid for a personal umbrella liability policy.

For Mr. Debbink, includes perquisites in an aggregate amount of $11,920, which includes the incremental additional cost of $10,163 for spouse travel and meals for business events to which spouses are invited and $1,757 for premiums paid for a personal umbrella liability policy.

For Mr. Lichtendahl, includes perquisites in an aggregate amount of $11,579, which includes the incremental additional cost of $10,208 for spouse travel and meals for business events to which spouses are invited and $1,371 for premiums paid for a personal umbrella liability policy.

For Mr. McMullen, includes perquisites in an aggregate amount of $11,920, which includes the incremental additional cost of $10,503 for spouse travel and meals for business events to which spouses are invited and $1,417 for premiums paid for a personal umbrella liability policy.

For Mr. Osborn, includes perquisites in an aggregate amount of $11,972, which includes the incremental additional cost of $10,320 for spouse travel and meals for business events to which spouses are invited and $1,652 for premiums paid for a personal umbrella liability policy.

For Mr. Skidmore, includes perquisites in an aggregate amount of $12,343, which includes the incremental additional cost of $10,847 for spouse travel and meals for business events to which spouses are invited and $1,496 for premiums paid for a personal umbrella liability policy.

For Mr. Steele, includes perquisites in an aggregate amount of $11,476, which includes the incremental additional cost of $9,687 for spouse travel and meals for business events to which spouses are invited and $1,789 for premiums paid for a personal umbrella liability policy.

For Mr. Webb, includes perquisites in an aggregate amount of $19,644, which includes the incremental additional cost of $10,195 for spouse travel and meals for business events to which spouses are invited and $9,449 for premiums paid for a personal umbrella liability policy.

In 2015,2016, nonemployee directors were compensated for their board service as follows:

Annual Cash Retainer	$40,000
Annual Stock Retainer	$40,000
Lead Director Annual Cash Retainer	$25,000
Independent Committee Chair Cash Retainer	$10,000
Meeting Fees –- Cash	$4,500 per board meeting
	$1,500 per committee meeting (except investment committee)
	$6,000 per investment committee meeting
	$7,500 maximum per day
Meeting Fees –- Stock	Matches cash meeting fees up to maximum of $60,000 per year

The Committee grants the stock awards for each director’s prior year’s board service under the 2009 Stock Plan at its first scheduled meeting each calendar year. See Stock-Based Award Grant Practices, Page 50.53. Amounts shown in the Stock Awards column reflect grants awarded under the 2009 Stock Plan at the Committee’s meeting on January 28, 2016,26, 2017, for board service in 2015.

2016.

At its meeting on January 26, 2017, the Committee approved an annual cash retainer for position of nonexecutive chairman of the board of $50,000.

The company also provides outside directors with life insurance, personal umbrella liability insurance and spouse travel and meals for certain business events. See Perquisites and Other Personal Benefits, Page 52,54, for details about these benefits. Amounts contained in the All Other Compensation column reflect the aggregate cost of these individual benefits.

The company does not provide outside directors with retirement benefits, benefits under health and welfare plans or compensation in any form not described above, nor does it have any agreement with any director to make charitable donations in the director’s name.

Page 65

Conclusion

Shareholder Proposals for Next Year

Any qualified shareholder who wishes to present a proposal for action at the 20172018 Annual Meeting of Shareholders must submit the proposal to Cincinnati Financial Corporation, Attn: Lisa A. Love, Corporate Secretary, P.O. Box 145496, Cincinnati, Ohio 45250-5496, on or before November 18, 2016,16, 2017, to be included in our proxy statement for the 20172018 Annual Meeting of Shareholders. Any such proposal must conform to the rules and regulations of the SEC and otherwise be in accordance with other federal laws as well as the laws of the State of Ohio. If the date of the 20172018 Annual Meeting of Shareholders is not within 30 days of April 30, 2017,May 6, 2018, the deadline will be a reasonable time before we begin to print and mail the proxy materials for the 20172018 annual meeting. In addition, the proxy solicited by the board for the 20172018 annual meeting will confer discretionary authority on the persons named in such proxy to vote on any shareholder proposal presented at that meeting if we receive notice of such proposal later than February 1, 2017,January 31, 2018, without the matter having been discussed in such proxy.

Any qualified shareholder who wishes to present a proposal for action or for nomination of a candidate for election to our board of directors at the 20172018 Annual Meeting of Shareholders (other than any proposal made pursuant to Rule 14a-8 under the Securities and Exchange Act of 1934) must deliver a notice of the proposal, in the form required by Section 6 of our Code of Regulations, to our corporate secretary on or before March 1, 2017,7, 2018, but not before January 21, 2017,26, 2018, or the shareholder’s proposal will not be permitted to be brought before the 20172018 Annual Meeting of Shareholders.

Cost of Solicitation

Proxies may be solicited by our directors, officers or other employees, either in person or by mail, telephone or email. The cost of soliciting proxies will be borne by the company. We have contracted with Alliance Advisors LLC to provide Internetinternet and telephone voting service for our direct shareholders of record. We ask banks, brokerage houses, other custodians, nominees and fiduciaries to forward copies of the proxy materials to beneficial owners of shares or to request authority for the execution of proxies; and we have agreed to reimburse reasonable out-of-pocket expenses incurred. We have retained the services of Alliance Advisors LLC, a proxy solicitation firm, to assist us in soliciting proxies for the 20162017 Annual Meeting of Shareholders. The cost of such services is estimated at $12,500 plus out-of-pocket expenses.

Other Business

Management does not know of any other matter or business that may be brought before the meeting; but if any other matter or business properly comes before the meeting, it is intended that a vote will be cast pursuant to the accompanying proxy in accordance with the judgment of the person or persons voting the same.

/S/ Lisa A. Love

Lisa A. Love, Esq.

Senior Vice President, General Counsel and Corporate Secretary

March 16, 2016

22, 2017

Cincinnati Financial Corporation

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Appendix A

Definitions of Non-GAAP Information and Reconciliation to Comparable GAAP Measures

(See attached tables for reconciliations; prior-period reconciliations available atcinfin.com/investors.)

Cincinnati Financial Corporation prepares its public financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP). Statutory data is prepared in accordance with statutory accounting rules as defined by the National Association of Insurance Commissioners’ (NAIC) Accounting Practices and Procedures Manual, and therefore is not reconciled to GAAP data.

Management uses certain non-GAAP and nonstatutorynon-statutory financial measures to evaluate its primary business areas –- property casualty insurance, life insurance and investments. Management uses these measures when analyzing both GAAP and non-GAAP measures to improve its understanding of trends in the underlying business and to help avoid incorrect or misleading assumptions and conclusions about the success or failure of company strategies. Management adjustments to GAAP measures generally: apply to nonrecurringnon-recurring events that are unrelated to business performance and distort short-term results; involve values that fluctuate based on events outside of management’s control; supplement reporting segment disclosures with disclosures for a subsidiary company or for a combination of subsidiaries or reporting segments; or relate to accounting refinements that affect comparability between periods, creating a need to analyze data on the same basis.

	·	Operating income: Operating income is calculated by excluding net realized investment gains and losses (defined as realized investment gains and losses after applicable federal and state income taxes) from net income. Management evaluates operating income to measure the success of pricing, rate and underwriting strategies. While realized investment gains (or losses) are integral to the company’s insurance operations over the long term, the determination to realize investment gains or losses in any period may be subject to management’s discretion and is independent of the insurance underwriting process. Also, under applicable GAAP accounting requirements, gains and losses can be recognized from certain changes in market values of securities without actual realization. Management believes that the level of realized investment gains or losses for any particular period, while it may be material, may not fully indicate the performance of ongoing underlying business operations in that period.

Operating income: Operating income is calculated by excluding net realized investment gains and losses (defined as realized investment gains and losses after applicable federal and state income taxes) from net income. Management evaluates operating income to measure the success of pricing, rate and underwriting strategies. While realized investment gains (or losses) are integral to the company’s insurance operations over the long term, the determination to realize investment gains or losses in any period may be subject to management’s discretion and is independent of the insurance underwriting process. Also, under applicable GAAP accounting requirements, gains and losses can be recognized from certain changes in market values of securities without actual realization. Management believes that the level of realized investment gains or losses for any particular period, while it may be material, may not fully indicate the performance of ongoing underlying business operations in that period.

For these reasons, many investors and shareholders consider operating income to be one of the more meaningful measures for evaluating insurance company performance. Equity analysts who report on the insurance industry and the company generally focus on this metric in their analyses. The company presents operating income so that all investors have what management believes to be a useful supplement to GAAP information.

·

Value creation ratio: This is a measure of shareholder value creation that management believes captures the contribution of the company’s insurance operations, the success of its investment strategy and the importance placed on paying cash dividends to shareholders. The value creation ratio measure is made up of two primary components: (1) rate of growth in book value per share plus (2) the ratio of dividends declared per share to beginning book value per share. Management believes this non-GAAP measure is a useful supplement to GAAP information, providing a meaningful measure of long-term progress in creating shareholder value. It is intended to be all-inclusive regarding changes in book value per share, and uses originally reported book value per share in cases where book value per share has been adjusted, such as adoption of Accounting Standards Updates with a cumulative effect of a change in accounting.

·

Statutory accounting rules: For public reporting, insurance companies prepare financial statements in accordance with GAAP. However, insurers also must calculate certain data according to statutory accounting rules as defined in the NAIC’s Accounting Practices and Procedures Manual, which may be, and has been, modified by various state insurance departments. Statutory data is publicly available, and various organizations use it to calculate aggregate industry data, study industry trends and compare insurance companies.

·

Written premium: Under statutory accounting rules, property casualty written premium is the amount recorded for policies issued and recognized on an annualized basis at the effective date

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Value creation ratio: This is a measure of shareholder value creation that management believes captures the contribution of the company’s insurance operations, the success of its investment strategy and the importance placed on paying cash dividends to shareholders. The value creation ratio measure is made up of two primary components: (1) rate of growth in book value per share plus (2) the ratio of dividends declared per share to beginning book value per share. Management believes this non-GAAP measure is a useful supplement to GAAP information, providing a meaningful measure of long-term progress in creating shareholder value. It is intended to be all-inclusive regarding changes in book value per share, and uses originally reported book value per share in cases where book value per share has been adjusted, such as adoption of Accounting Standards Updates with a cumulative effect of a change in accounting.

of the policy. Management analyzes trends in written premium to assess business efforts. Earned premium, used in both statutory and GAAP accounting, is calculated ratably over the policy term. The difference between written and earned premium is unearned premium.

Consolidated property casualty insurance results: To supplement reporting segment disclosures related to our property casualty insurance operations, we also evaluate results for those operations on a basis that includes results for our property casualty insurance and brokerage services subsidiaries. That is the total of our commercial lines, personal lines and our excess and surplus lines segment plus our reinsurance assumed operations.

Life insurance subsidiary results: To supplement life insurance reporting segment disclosures related to our life insurance operation, we also evaluate results for that operation on a basis that includes life insurance subsidiary investment income, or investment income plus net realized investment gains, that are also included in our investments reporting segment. We recognize that assets under management, capital appreciation and investment income are integral to evaluating the success of the life insurance segment because of the long duration of life products.

Statutory accounting rules: For public reporting, insurance companies prepare financial statements in accordance with GAAP. However, insurers also must calculate certain data according to statutory accounting rules as defined in the NAIC’s Accounting Practices and Procedures Manual, which may be, and has been, modified by various state insurance departments. Statutory data is publicly available, and various organizations use it to calculate aggregate industry data, study industry trends and compare insurance companies.

Written premium: Under statutory accounting rules, property casualty written premium is the amount recorded for policies issued and recognized on an annualized basis at the effective date of the policy. Management analyzes trends in written premium to assess business efforts. Earned premium, used in both statutory and GAAP accounting, is calculated ratably over the policy term. The difference between written and earned premium is unearned premium.

Cincinnati Financial Corporation

Balance Sheet Reconciliation

(Dollars are per share)										Twelve months ended December 31,
										2015				2014
Value creation ratio:
End of period book value										$	39.20			$	40.14
Less beginning of period book value											40.14				37.21
Change in book value											(0.94	)			2.93
Dividend declared to shareholders											2.30				1.76
Total value creation										$	1.36			$	4.69
Value creation ratio from change in book value*											(2.3	)%			7.9	%
Value creation ratio from dividends declared to shareholders**											5.7				4.7
Value creation ratio											3.4	%			12.6	%

*

Change in book value divided by the beginning of period book value

**

Dividend declared to shareholders divided by beginning of period book value

(Dollars are per share)						Twelve months ended December 31,
						2016				2015
Value creation ratio:
End of period book value						$	42.95			$	39.20
Less beginning of period book value						39.20				40.14
Change in book value						3.75				(0.94		)
Dividend declared to shareholders						1.92				2.30
Total value creation						$	5.67			$	1.36
Value creation ratio from change in book value*						9.6		%		(2.3		)%
Value creation ratio from dividends declared to    shareholders**						4.9				5.7
Value creation ratio						14.5		%		3.4		%
* Change in book value divided by the beginning of period book value
** Dividend declared to shareholders divided by beginning of period book value

Net Income Reconciliation

(Dollars in millions except per share data)										Twelve months ended December 31,
										2015				2014
Net income										$	634			$	525
Realized investment gains and losses, net											45				85
Operating income											589				440
Less catastrophe losses											(105	)			(133	)
Operating income before catastrophe losses										$	694			$	573
Diluted per share data:
Net income										$	3.83			$	3.18
Realized investment gains and losses, net											0.27				0.52
Operating income											3.56				2.66
Less catastrophe losses											(0.63	)			(0.81	)
Operating income before catastrophe losses										$	4.19			$	3.47

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Cincinnati Financial Corporation

(Dollars in millions except per share data)						Twelve months ended December 31,
						2016				2015
Net income						$	591			$	634
Less:
Realized investment gains and losses, net						124				70
Income tax on realized investment gains and losses						(44		)		(25		)
Realized investment gains and losses, after-tax						80				45
Operating income						$	511			$	589
Diluted per share data:
Net income						$	3.55			$	3.83
Less:
Realized investment gains and losses, net						0.74				0.42
Income tax on realized investment gains and losses						(0.26		)		(0.15		)
Realized investment gains and losses, after-tax						0.48				0.27
Operating income						$	3.07			$	3.56

Life Insurance Reconciliation

(Dollars in millions)						Twelve months ended December 31,
						2016				2015
Net income of life insurance subsidiary						$	48			$	41
Realized investment gains, net						8				1
Income tax on realized investment gains						3				1
Operating income						43				41
Investment income, net of expenses						(155		)		(150		)
Investment income credited to contract holders'						90				86
Income tax on investment income and investment income credited to contract holders'						23				21
Life insurance segment profit (loss)						$	1			$	(2	)

Property Casualty Operations Reconciliation

(Dollars in millions)		Twelve months ended December 31, 2015
		Consolidated*				Commercial				Personal				E&S
Premiums:
Written premiums		$	4,361			$	3,025			$	1,128			$	175
Unearned premiums change			(90	)			(29	)			(31	)			(7	)
Earned premiums		$	4,271			$	2,996			$	1,097			$	168
Statutory ratios:
Combined ratio			90.6	%			88.3	%			100.0	%			71.9	%
Contribution from catastrophe losses			3.7				3.1				6.2				0.4
Combined ratio excluding catastrophe losses			86.9	%			85.2	%			93.8	%			71.5	%
Commission expense ratio			18.5	%			18.3	%			17.7	%			27.2	%
Other underwriting expense ratio			11.9				13.0				10.4				2.8
Total expense ratio			30.4	%			31.3	%			28.1	%			30.0	%
GAAP ratios:
Combined ratio			91.1	%			88.6	%			101.3	%			70.0	%
Contribution from catastrophe losses			3.7				3.1				6.2				0.4
Prior accident years before catastrophe losses			(3.9	)			(4.7	)			0.8				(20.6	)
Current accident year combined ratio before catastrophe losses			91.3	%			90.2	%			94.3	%			90.2	%

Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on dollar amounts in thousands.

*Consolidated property casualty data includes results from our Cincinnati Re^SM operations.

(Dollars in millions)	Twelve months ended December 31, 2016
	Consolidated					Commercial					Personal						E&S				Cincinnati Re
Premiums:
Written premiums		$	4,580				$	3,122				$	1,198				$	189				$	71
Unearned premiums change		(98		)			(33		)			(37		)			(6		)			(22		)
Earned premiums		$	4,482				$	3,089				$	1,161				$	183				$	49
Statutory ratios:
Combined ratio		94.5		%			93.9		%			100.8		%			68.1		%			79.6		%
Contribution from catastrophe losses		7.5					7.1					9.4					1.5					6.8
Combined ratio excluding catastrophe losses		87.0		%			86.8		%			91.4		%			66.6		%			72.8		%
Commission expense ratio		18.4		%			18.1		%			17.7		%			27.1		%			21.1		%
Other underwriting expense ratio		12.3					13.4					10.7					3.4					8.1
Total expense ratio		30.7		%			31.5		%			28.4		%			30.5		%			29.2		%
GAAP ratios:
Combined ratio		94.8		%			94.2		%			101.4		%			67.0		%			82.5		%
Contribution from catastrophe losses		7.5					7.1					9.4					1.5					6.8
Prior accident years before catastrophe losses		(3.5		)			(4.0		)			0.0					(18.3		)			(3.2		)
Current accident year combined ratio before      catastrophe losses		90.8		%			91.1		%			92.0		%			83.8		%			78.9		%
Dollar amounts shown are rounded to millions; certain amounts may not add due to rounding. Ratios are calculated based on dollar amounts in thousands.

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82

Appendix B

Cincinnati Financial Corporation 2016 Stock Compensation Plan

1.

Purpose.The purpose of the Plan is to support the Company’s ongoing efforts to attract, develop, retain and motivate Associates and to provide them with incentives that are directly linked to the profitability of the Company’s businesses and to increases in shareholder value.

2.

Definitions. For purposes of the Plan, the following terms are defined as set forth below:

a.

“Associate” means employee of the Company or its operating subsidiaries and affiliates.

b.

“Award” means a grant under the Plan of Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, or Other Stock-Based Awards.

c.

“Board” means the Board of Directors of the Company.

d.

“Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto.

e.

“Commission” means the Securities and Exchange Commission or any successor agency.

f.

“Committee” means the compensation committee of the Board or a subcommittee thereof, any successor thereto or such other committee or subcommittee as may be designated by the Board to administer the Plan, which, in any case, shall include as members at least two “nonemployees” within the meaning of Rule 16b-3 of the SEC, two “outside directors” for purposes of Code Section 162(m), and which is otherwise in compliance with any other requirements of applicable laws or regulations or the requirements of The Nasdaq Global Select Market.

g.

“Common Stock” or “Stock” means the common stock of the Company.

h.

“Company” means Cincinnati Financial Corporation, a corporation organized under the laws of the State of Ohio, or any successor thereto.

i.

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor thereto.

j.

“Fair Market Value” means, as of any given date, the mean between the highest and lowest reported sales prices of the Common Stock on The Nasdaq Global Select Market, or, if no such sale of Common Stock is reported on such date, the fair market value of the Stock as determined by the Committee in good faith.

k.

“Incentive Stock Option” means any Stock Option that complies with Section 422 (or any amended or successor provision) of the Code.

l.

“Nonqualified Stock Option” means any Stock Option that is not an Incentive Stock Option.

m.

“Other Stock-Based Award” means an Award made pursuant to Section 6(a)(v).

n.

“Participant” means any eligible Associate as set forth in Section 4 to whom an Award is granted.

o.

“Performance Cycle” means the period selected by the Committee during which the performance of the Company or of any subsidiary, affiliate or of unit thereof or any individual is measured for the purpose of determining the extent to which an Award subject to Performance Goals has been earned.

p.

“Performance Goals” mean the objectives for the Company or any subsidiary or affiliate or any unit thereof or any individual that may be established by the Committee for a Performance Cycle with respect to any performance-based Awards contingently awarded under the Plan. The Performance Goals for Awards that are intended to constitute “performance-based” compensation within the meaning of Section 162(m) (or any amended or successor provision) of the Code shall be derived from one or more of the following criteria: earnings per share, total shareholder return, operating income, net income, adjusted net earnings, cash flow, return on equity, return on capital, the combined ratio, premium growth, investment performance, and/or value creation ratio.

q.

“Plan” means this Cincinnati Financial Corporation 2016 Stock Compensation Plan, as amended from time to time.

Page 70

r.

“Restricted Period” means the period during which an Award may not be sold, assigned, transferred, pledged or otherwise encumbered.

s.

“Restricted Stock” means an Award of shares of Common Stock pursuant to Section 6(a)(iii).

t.

“Restricted Stock Unit” means an Award described in Section 6(a)(iv).

u.

“Spread Value” means, with respect to a share of Common Stock subject to an Award, an amount equal to the excess of the Fair Market Value, on the date such value is determined, over the Award’s exercise or grant price, if any.

v.

“Stock Appreciation Right” or “SAR” means a right granted pursuant to Section 6(a)(ii).

w.

“Stock Option” means an Incentive Stock Option or a Nonqualified Stock Option granted pursuant to Section 6(a)(i).

x.

“Value Creation Ratio” means the total of 1) rate of growth in book value per share plus 2) the ratio of dividends declared per share to beginning book value per share.

3.

Administration. The Plan shall be administered by the Committee, which shall have the power to interpret the Plan and to adopt such rules and guidelines for carrying out the Plan as it may deem appropriate. The Committee shall have the authority to adopt such modifications, procedures and sub-plans as may be necessary or desirable to comply with all applicable laws, regulations, and accounting principles. Subject to the terms of the Plan, the Committee shall have the authority to determine those Associates who shall receive Awards and the amount, type and terms of each Award, and to establish and administer any Performance Goals applicable to such Awards. The Committee may delegate its authority and power under the Plan to one or more officers of the Company, subject to guidelines prescribed by the Committee, but only with respect to Participants who are not subject to either Section 16 of the Exchange Act or Section 162(m) (or any amended or successor provision) of the Code. Any determination made by the Committee or by one or more officers pursuant to delegated authority in accordance with the provisions of the Plan with respect to any Award shall be made in the sole discretion of the Committee or such delegate, and all decisions made by the Committee or any appropriately designated officer pursuant to the provisions of the Plan shall be final, binding and conclusive on all persons, including the Company and Plan Participants.

4.

Eligibility. All Associates of the Company and its subsidiaries and affiliates are eligible to be granted Awards under the Plan. No Associate shall have at any time the right to receive an Award, or having previously received an Award, to receive any further Awards.

5.

Common Stock Subject to the Plan.

a.

Common Stock Available. The total number of shares of Common Stock reserved and available for distribution pursuant to Awards granted under the Plan shall be 10,000,000; provided, however, that any shares of Common Stock issued to Participants pursuant to Awards in any form other than Stock Options shall be counted against such 10,000,000-share limit as three shares for every one share of Common Stock actually issued. Each Stock Appreciation Right Award granted under the Plan that may be settled in shares of Common Stock shall be counted in full (i.e., to the extent of the face number of shares originally granted) against the maximum number of shares of Common Stock available for award under the Plan, regardless of the actual number of shares of Common Stock that are actually issued to the Participant upon settlement of the Stock Appreciation Right. Shares issued under the Plan may be either authorized but unissued shares or treasury shares, as designated by the Committee. To the extent any Award under this Plan terminates, expires or is forfeited without a distribution being made to the Participant in the form of Common Stock, the shares subject to such Award that were not so issued, if any, shall again become available for distribution in connection with Awards under the Plan. Any shares of Common Stock that are used by a Participant as full or partial payment of withholding or other taxes or as payment for the exercise or conversion price of an Award under the Plan shall not be available for subsequent distribution in connection with Awards under the Plan.

b.

Adjustments for Certain Corporate Transactions.In the event of any merger, share exchange, reorganization, consolidation, recapitalization, reclassification, distribution, stock

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dividend, stock split, reverse stock split, split-up, spin-off, issuance of rights or warrants or other similar transaction or event affecting the Common Stock after adoption of the Plan, the Committee is authorized to make such adjustments or substitutions with respect to the Plan and to Awards granted hereunder as it deems appropriate to reflect the occurrence of such event, including, but not limited to, adjustments (A) to the aggregate number and kind of securities reserved for issuance under the Plan, (B) to the Award limits set forth in Section 6, (C) to the Performance Goals or Performance Cycles of any outstanding Performance-Based Awards, and (D) to the number and kind of securities subject to outstanding Awards and, if applicable, the grant or exercise price or Spread Value of outstanding Awards. In connection with any of the events described in this Section 5(b), the Committee is also authorized to provide for the payment of any outstanding Awards in cash, including, but not limited to, payment of cash in lieu of any fractional Awards. In the event of any conflict between this Section 5(b) and other provisions of the Plan, the provisions of this section shall control.

6.

Awards.

a.

General. The types of Awards that may be granted under the Plan are set forth below. Awards may be granted singly, in combination or in tandem with other Awards.

i.

Stock Options.A Stock Option represents the right to purchase a share of stock at a predetermined grant price. Stock Options granted under the Plan may be in the form of Incentive Stock Options or Nonqualified Stock Options, as specified in the Award agreement. The term of each Stock Option shall be set forth in the Award agreement, but no Stock Option shall be exercisable more than 10 years after the grant date. The grant price per share of Common Stock purchasable under a Stock Option shall not be less than 100 percent of the Fair Market Value on the date of grant. Subject to the applicable Award agreement, Stock Options may be exercised, in whole or in part, by giving written notice of exercise specifying the number of shares to be purchased. Such notice shall be accompanied by payment in full of the purchase price by certified or bank check or such other instrument as the Company may accept (including a copy of instructions to a broker or bank acceptable to the Company to deliver promptly to the Company an amount sufficient to pay the purchase price). Unless otherwise determined by the Committee, payment in full or in part may also be made in the form of Common Stock already owned by the Participant valued at Fair Market Value. Except for a beneficiary designation as permitted by the terms of the applicable Award agreement or as designated by a Participant by will or as prescribed by the laws of descent and distribution, Stock Options may not be sold, assigned, transferred, pledged or otherwise encumbered.

ii.

Stock Appreciation Rights. A SAR represents the right to receive a payment, in cash, shares of Common Stock, or both (as determined by the Committee), with a value equal to the Spread Value on the date the SAR is exercised. The grant price of a SAR shall be set forth in the applicable Award agreement and shall not be less than 100 percent of the Fair Market Value on the date of grant. Subject to the terms of the applicable Award agreement, a SAR shall be exercisable, in whole or in part, by giving written notice of exercise to the Company in the manner prescribed in the applicable Award agreement. Except for a beneficiary designation as permitted by the terms of the applicable Award agreement or as designated by a Participant by will or prescribed by the laws of descent and distribution, SARs may not be sold, assigned, transferred, pledged or otherwise encumbered.

iii.

Restricted Stock. Shares of Restricted Stock are shares of Common Stock that are awarded to a Participant and that during the Restricted Period may be forfeitable to the Company upon such conditions as may be set forth in the applicable Award agreement. Except for a beneficiary designation as permitted by the terms of the applicable Award agreement or as designated by a Participant by will or prescribed by the laws of descent and distribution, Restricted Stock may not be sold, assigned, transferred, pledged or otherwise encumbered during the Restricted Period. Except as provided above or in the applicable Award agreement, a Participant shall have with respect to such Restricted Stock all the rights of a holder of Common Stock during the Restricted Period.

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iv.

Restricted Stock Units. Restricted Stock Units represent the right to receive shares of Common Stock, cash, or both (as determined by the Committee) upon satisfaction of such conditions as may be set forth in the applicable Award agreement. Except for a beneficiary designation as permitted by the terms of the applicable Award agreement or as designated by a Participant by will or prescribed by the laws of descent and distribution, Restricted Stock Units may not be sold, assigned, transferred, pledged or otherwise encumbered during the Restricted Period. Except as provided in the applicable Award agreement, a Participant shall have with respect to such Restricted Stock Units none of the rights of a holder of Common Stock unless and until shares of Common Stock are actually delivered in satisfaction of the conditions underlying such Restricted Stock Units.

v.

Other Stock-Based Awards.Other Stock-Based Awards are Awards, other than Stock Options, SARs, Restricted Stock, or Restricted Stock Units that are denominated in, valued in whole or in part by reference to, or otherwise based on or related to, Common Stock. The grant, purchase, exercise, exchange or conversion of Other Stock-Based Awards granted under this subsection (v) shall be on such terms and conditions and by such methods as shall be specified by the Committee. Where the value of an Other Stock-Based Award is based on the Spread Value, the grant price for such an Award shall not be less than 100 percent of the Fair Market Value on the date of grant.

b.

Performance-Based Awards. Any Awards granted pursuant to the Plan may be in the form of performance-based Awards through the application of Performance Goals and Performance Cycles.

c.

Award Limitations.Awards granted under the Plan which are intended to qualify as performance-based compensation under Section 162(m) of the Code shall be subject to the following limitations:

i.

Stock Options. No Participant shall be granted Stock Options on more than 100,000 shares of Common Stock during any single calendar year.

ii.

Incentive Stock Options.The aggregate Fair Market Value (at the grant date) of the Common Stock with respect to which Incentive Stock Options are first exercisable by any Participant in any one calendar year shall not exceed $100,000.

iii.

Restricted Stock and Restricted Stock Units.No Participant shall be granted Restricted Stock and/or Restricted Stock Units in a total amount exceeding 100,000 shares of Common Stock during any single calendar year.

iv.

Stock Appreciation Rights and Other Stock-Based Awards. No Participant shall be granted Stock Appreciation Rights and/or Other Stock-Based Awards in a total amount exceeding 100,000 shares of Common Stock during any single calendar year.

7.

Change in Control.Unless otherwise expressly provided in an applicable Award agreement and notwithstanding any other provision of the Plan to the contrary, if a Participant’s employment with the Company is terminated by action of the employing entity within 12 months after the effective date of a Change in Control, then all Stock Options and Stock Appreciation Rights held by such Participant as of the date of termination shall become fully vested and exercisable, and the restrictions and other conditions applicable to any Restricted Stock, Restricted Stock Units, or Other Stock-Based Awards held by such Participant as of the date of termination, including vesting requirements, shall lapse, and such Awards shall become free of all restrictions and fully vested. For this purpose, a “Change in Control” means the event which shall be deemed to have occurred after the date this Plan is adopted by the Company’s shareholders if either (i), any person, entity or group becomes a beneficial owner, directly or indirectly, of securities of the Company representing 20 percent or more of the combined voting power of the Company’s then outstanding securities; or (ii) as a result of, or in connection with, or within two years following, a tender or exchange offer for the voting stock of the Company, a merger or other business combination to which the Company is a party, the sale or other disposition of all or substantially all of the assets of the Company, a reorganization of the Company, or a proxy contest in

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connection with the election of members of the Board of Directors, the persons who were directors of the Company immediately prior to any such transactions cease to constitute a majority of the Board of Directors or of the board of directors of any successor to the Company (except for resignation due to death, disability or normal retirement). For purposes of the definition in the preceding sentence, any terms that are defined by rules promulgated by the SEC shall have the meanings specified in such definitions from time to time.

8.

Clawback and Forfeiture.Any awards granted under the Plan may be subject to reduction, cancellation, forfeiture or recoupment to the extent required by applicable laws, regulations, stock exchange rules, Company policies or to the extent otherwise provided in an Award agreement at the time of grant.

9.

Plan Amendment and Termination. The Board may amend or terminate the Plan at any time, provided that no amendment shall be made without shareholder approval if such approval is required under applicable law, regulation, or stock exchange rule, or if such amendment would (i) decrease the grant or exercise price of any Stock Option, SAR or Other Stock-Based Award to less than the Fair Market Value on the date of grant, or (ii) increase the total number of shares of Common Stock that may be distributed under the Plan. The Committee may not, without shareholder approval, cancel any Stock Option, SAR or Other Stock-Based Award and substitute it with a lower grant price, cash or other awards. Except as set forth in any Award agreement or as necessary to comply with applicable law or avoid adverse tax consequences to some or all Plan Participants, no amendment or termination of the Plan may materially and adversely affect any outstanding Award under the Plan without the Award recipient’s consent.

10.

Payments and Payment Deferrals.Payment of Awards may be in the form of cash, Common Stock, other Awards or combinations thereof as the Committee shall determine, and with such restrictions as it may impose. The Committee, either at the time of grant or by subsequent amendment, may require or permit deferral of the payment of Awards under such rules and procedures as it may establish. It also may provide that deferred settlements include the payment or crediting of interest or other earnings on the deferred amounts, or the payment or crediting of dividend equivalents where the deferred amounts are denominated in Common Stock equivalents.

11.

Award Agreements.Each Award under the Plan shall be evidenced by a written agreement in a form prescribed by the Committee that sets forth the terms, conditions and limitations for each Award. Such terms may include, but are not limited to, the term of the Award, vesting and forfeiture provisions, and the provisions applicable in the event the Participant’s employment terminates. The Committee may amend an Award agreement, provided that, except as set forth in any Award agreement or as necessary to comply with applicable law or avoid adverse tax consequences to some or all Plan Participants, no such amendment may materially and adversely affect an Award without the Participant’s consent.

12.

Unfunded Status of Plan.It is presently intended that the Plan constitute an “unfunded” plan for incentive and deferred compensation. The Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments; provided, however, that, unless the Committee otherwise determines, the existence of such trusts or other arrangements is consistent with the “unfunded” status of the Plan.

13.

General Provisions.

a.

Investment Representations.The Committee may require each person acquiring shares of Common Stock pursuant to an Award to represent to and agree with the Company in writing that such person is acquiring the shares for investment and not with a view to the distribution thereof. The certificates for such shares may include any legend that the Committee deems appropriate to reflect any restrictions on transfer.

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b.

Not an Employment Obligation.Neither the adoption of the Plan nor the granting of Awards under the Plan shall confer upon any Associate any right to continued employment nor shall they interfere in any way with the right of the Company, a subsidiary or an affiliate to terminate the employment of any Associate at any time.

c.

Income Tax Withholding.No later than the date as of which an amount first becomes includable in the gross income of the Participant for income tax purposes with respect to any Award under the Plan, the Participant shall pay to the Company, or make arrangements satisfactory to the Company for the payment of, any federal, state, local or foreign taxes of any kind that are required by law or applicable regulation to be withheld with respect to such amount. Unless otherwise determined by the Committee and except in the case of Incentive Stock Options, withholding obligations arising from an Award may be settled with Common Stock, including Common Stock that is part of, or is received upon exercise or conversion of, the Award that gives rise to the withholding requirement. The obligations of the Company under the Plan shall be conditional on such payment or arrangements, and the Company, its subsidiaries and its affiliates shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due to the Participant. The Committee may establish such procedures as it deems appropriate, including the making of irrevocable elections, for the settling of withholding obligations with Common Stock.

d.

Governing Law.The Plan and all Awards made and actions taken thereunder shall be governed by and construed in accordance with the laws of the State of Ohio, excluding any conflicts or choice of law, rule or principle that might otherwise refer construction or interpretation of the Plan to the substantive law of another jurisdiction. Unless otherwise provided in an Award, recipients of an Award under the Plan are deemed to submit to the exclusive jurisdiction and venue of the federal or state courts of Ohio to resolve any and all issues that may arise out of or relate to the Plan or any related Award.

e.

Severability.If any provision of the Plan is held invalid or unenforceable, the invalidity or unenforceability shall not affect the remaining parts of the Plan, and the Plan shall be enforced and construed as if such provision had not been included.

f.

Successors and Assigns.All obligations of the Company under the Plan with respect to Awards granted hereunder shall be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.

g.

Effective Date; Plan Expiration.If approved by the Company shareholders, the Plan shall become effective on April 30, 2016. Except as otherwise provided by the Board, no Awards shall be made after April 29, 2026, provided that any Awards granted prior to that date may extend beyond it, and provided further that the Performance Goals shall be subject to approval of the Company’s shareholders at least once every five years as prescribed by Code Section 162(m).

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Contact Information

You may direct communications to Cincinnati Financial Corporation’s Senior Vice President, General Counsel and Corporate Secretary Lisa A. Love, Esq. for sharing with the appropriate individual(s). Or, you may directly access services:Investors:Investor Relations responds to investor inquiries about the company and its performance. Dennis E. McDaniel, CPA, CMA, CFM, CPCU – Vice President, Investor Relations Officer  513-870-2768 orinvestor_inquiries@cinfin.com

Shareholders:Shareholder Services administers the company’s stock compensation plans and fulfills requests for shareholder materials.

Molly A. Grimm, CEP – Assistant Vice President, Shareholder Services  513-870-2639 orshareholder_inquiries@cinfin.comAmerican Stock Transfer & Trust Company LLC provides the company’s stock transfer and recordkeeping services, including assisting registered shareholders with updating account information or enrolling in shareholder plans. 6201 15^th Avenue, Brooklyn, NY 11219  866-638-6443 orinfo@amstock.com

Media:Corporate Communications assists media representatives seeking information or comment from the company or its subsidiaries. Betsy E. Ertel, CPCU, AIM, API – Vice President, Corporate Communications  513-603-5323 ormedia_inquiries@cinfin.com

CINCINNATI FINANCIAL CORPORATION

The Cincinnati Insurance Company  The Cincinnati Casualty Company  The Cincinnati Indemnity Company  The Cincinnati Life Insurance Company 

The Cincinnati Specialty Underwriters Insurance Company  CSU Producer Resources Inc.  CFC Investment Company  Mailing Address P.O. Box 145496 

Cincinnati, Ohio 45250-5496 Street Address 6200 South Gilmore Road Fairfield, Ohio 45014-5141 Phone: 888-242-8811 or 513-870-2000  Email:cfc_corporate@cinfin.com  Web:cinfin.com

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