CINF - Earnings call transcript Q3 2019 | Cincinnati Financial Corporation

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Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Third Quarter 2019 Earnings Conference Call. [Operator Instructions].

I would now like to hand the conference over to your speaker for today, Mr. Dennis McDaniel with Investor Relations Officer. Thank you, sir. ahead. go Please

Dennis McDaniel

our far Dennis joining is Conference quarter Cincinnati Thank portfolio. release Results Financial. Late the to financial the our Hello. copies including package, on McDaniel our for on news menu information a the us we Earnings Quarterly To our along Third in you with yesterday, supplemental This issued at results, Quarter of documents, the these on Call. route of end The our visit shortest investment link navigation please investor find any left. website, cinfin.com/investors. is XXXX

call, may hear in Board, from the Theresa and Senior Chief and this Steve questions. by Mullen; some time, Officer, Chairman ask with participating Marty Ken Hoffer. their Insurance's Marty Stecher; room be Steve then Spray; Chief Mike Chief Officer, Johnston, investors Sewell. others including After Hollenbeck; At Corporate that On President Investment Finance, you'll may Insurance first President Financial prepared Officer, responses and call Executive of made Officer, Claims Cincinnati the us, Officer; remarks, of the Chief from Vice Chief on and

be SEC. note a accounting release. With risks forward-looking of of some is reconciliation statutory please matters Also, the reconciled therefore, non-GAAP provided with accordance filings today we direct and data the accounting uncertainties, GAAP. Statutory news not These our various is with and was our the and to First, forward prepared release are respect and to looking. statements rules, to to with measures news risks that certain these involve discussed uncertainties. to attention your in

to it turn I'll -- call over Now Steve. to

Steven Johnston

hear us our and for joining more quarter Dennis. thank results. Good today morning, Thank about you, third you to

strategy growing operating insurance winning overtime. performance results it business believe our profitably steady and on reflect was our our dedication well. making and to improving Our We we're progress executing strong, again

XXXX was quarter very Net good. the of third income for

this the operating from first an results XX% value our was not Non-GAAP underwriting to each total. of represented in did a Although, property of the for segment in performed of it was an casualty changes months Every quarter year. and see XX% of X our the both fair securities well, and profit nice up year operating and our it income third for X months equity X/X year. of of the when match first the the units up ago business is impressive nearly

on X.X combined it property points Our and XX.X% was better basis. ratio quarter improved X.X third a XXXX points percentage ago, casualty year-to-date a year than

in continue see diversify and benefits We line work to from risk by recent years geography. to product

we pleased are when of also are with profit from opportunities profitable better increasing risks, accounts on confidence less us unsatisfactory. retaining to and results decline profitable ongoing business. segmentation getting gives That We more margins pricing determine

We a of understand to independent also value representing we their as and from premium earn communicate us having produce benefit insurance revenues how to outstanding agents, the they for more larger company. clients, to continue business. share They their

and increases casualty net rose new premiums Our X%, price growth renewal written healthy premiums. consolidated property written in including business

on ago estimated combined The segment's points a second the was than X.X ratio of year for were similar lines low third basis. X.X percentage average percentage and third XXXX points increases the year-to-date The the commercial lines to quarter quarter. a quarter price commercial single-digit increases better better

and lines underwriting similar continued We're rate well-positioned profit, future. experience to the lines XXXX. increases consecutive are growth quarters quarter with we to the average personal for segment the of personal by also believe profitable two Our encouraged second in

the very written XX% perform year-to-date continues third quarter Cincinnati planned very growth as perform Re combined ratio lines a to Our and net surplus for profitable excess XX%. well, and following ratio ratio segment in experienced first premium with a effects acquisition. below to the the purchase the of has an combined favorable continues XXs, few quarter Cincinnati a some of including post-acquisition in accounting including combined and low periods low XXs. Global

subsidiary quarter grow on third term its insurance premiums with up XX% to insurance continued life life basis. business an Our earned

as was year, as insurance diversification income valuable not and to Life Cincinnati While provides net strong our contribution as earnings. risks our last

importantly, for add all to agents Cincinnati More solutions clients, the umbrella. appreciate insurance the life ability their under

quarters grow also performance outperformed S&P year has continues outstanding. our to the to first investment Our portfolio and income the be XXX. X Investment during of equity continues this

with our quarter resulted long-term results markets and I'll our of performance, operating XX.X%, targeted as net a creation XX%. Improving boosting contribution was primary income months ago. X-month for operations The measure measure of annual up of wrap measured points year average X.X%, X.X well the gains of investment percentage from first up to our third VCR from XXXX, in ratio. securities above before favorable financial the X the value a XX% X.X% to

VCR, our overtime. to the risk due its important shareholders healthy supported of effects. believe short-term variability our appreciation We for market long-term creating potential portfolio understand for While value we is equity for

Officer, financial will insights areas on results. Financial share important our Now Mike Chief other Sewell, of our

Michael Sewell

to Steve, us you for joining thanks you, all today. of Thank and

growth many of Our our was purchases quarter have holdings. XX% rates investment the of during dividend X% income for stocks third our for increased Net rose effects. up of equity XXXX again, income Dividend pretax as before from tax Interest same income totaled was X.XX% third the portfolio the quarter the a third down from from quarter, basis The XX ago. million. for quarter our $XX the year. bond last portfolio declined average from quarter yield of points year third slightly

net bonds in We million. quarter third $XXX continue invest to purchases with of

$XX taxable XX-Q, continue $XX our same tax-exempt effects. income XX for portfolio. XXXX points changes the favorable portfolios. lower for purchased in before yield were for basis million included gain of average of portfolio million pretax our both As and valuation That bond period net and for than Investment we The for bonds our again portfolio and bond so $XXX total stock quarter XXXX, third pressured. the roughly equity to interest was the overall be the in was reported may tax million

including $X.X billion income X% months equity strong million Cash generated net billion, in XXXX, of activities We $XXX X Cash $XX value million catastrophe up $XXX million, after for losses. the growth. investment our this appreciated operating remained $X.X ended fueled first the flow flow more and or from paying quarter of in with even portfolio. year

aid the Another investments important controls area our in expense strategic for management growth with is balancing profitable business. of to

matched underwriting years was casualty property XXXX XXXX through quarter. average of higher last quarter points on it third year's But ratio X.X percentage basis, than expense a the full X-month XXXX. third The

carefully a target we for in net the of consistent approach half is actuarially reserves. of and Regarding range the reserving, loss We loss aim doing as expense net amounts so upper imperative. estimated

experienced X.X we of development prior amount percentage net During accident a the our satisfactory on property combined years. Favorable points. reserve ratio third benefit favorable quarter XXXX, casualty the by development quarter for

lines to accident and all control do changes XXXX, establish weather, it XX% a included inflation and social Regardless years. the accident for accident matters, or for XXXX year-to-date, On from root by year adequate accident year prior loss we trends best XX% other and cause basis particular reserves. our year, is of XXXX XX% for of

total reserves since that casualty XX%. the we have million or commercial $XXX example, by increased disclosed end XXXX, loss For our we've of

The or IBNR of total that up component is $XXX XX%. million

exposure one to up is premiums, earned estimate annualized insured period, change in same way the only X%. the During

up the reserves earned XX% component are auto, For are commercial loss with up total IBNR up premiums while XX%. XXX%,

managing company. critical to the capital, Turning for another function

Our approach remains stable.

Our financial as is flexibility. our is financial strength excellent

the investment Property value increase a for per high, noninsurance reduced of by losses share. book increased third book share. investment $X.XX, the per The $X.XX. Life operations As contributed third equity a was the and book items, losses and with quarter underwriting $X.XX casualty fixed by to in represent value contributions net usual, insurance to record of creation per life value summary by Investment book per I'll to value and of book gains portfolio income, than ratio. $XX.XX and quarter end by the added my main during share income $X.XX. we increased drivers portfolio $X.XX a increased prepared other Net share value effect shareholders. gains $X.XX. remarks They insurance declared $X.XX. our dividends the for value Net

call the back Steve. to turn I'll Now over

Steven Johnston

Thanks, Mike.

last the head momentum value far look year, the the opportunity far maintaining track also to right We're As shareholder We the XXXX. year. appreciate we've confident to forward in into with quarter of of to the many this created future. that person we're questions your during into deliver remainder respond was the on committed to so and the in we of Financial Cincinnati you meeting to

Marty reminder, Marty As Hollenbeck, Mike a Spray, Steve me Stecher. Theresa today are and Mullen, Hoffer and Ken with

the Katherine, please questions. open call for

Operator

Instructions]. [Operator

Crédit of line the from comes question Mike first Suisse. with Zaremski Your

Michael Zaremski

auto, any increase casualty be are you year-over-year, competitors, inflation I XXX%. know look seeing your larger If levels loss question. losses they are of view you And Thanks that. the more loss maybe pricing, also don't the close for versus commercial does your be that it's addressing but higher ratio think, First commercial Does paid could -- for to seem indicate incurred to trend discussion. wrong I just year-over-year or the at that year-to-date in trends? there. they're rise they I guys that trend? some you getting said potentially out a I they on changes, seeing comment could in ones, Are an seeing your pointed that have and so

Steven Johnston

season. that And Mike. be the does to earning Thanks, of this question Okay. seem

incurred look ratios, mentioned, the But year the of than paid-to-incurred you bit year. the actually was last at paid one lowest we paid higher is to had. as As year a paid this incurred -- the we that last

it all more I down, over conference addressed I XXXX position Mike And our as pointed So lines term, over back out time. very his consistently auto in we think if long call. commercial really the and at look it in break we going reserving think casualty, XXXX, the to we've

inflation total. We look at in

of a of So have be a very actuarial team. social with basket any use a up very come we that, other kind inflation the would sophisticated They or techniques talented to estimate. of inflation and part

multiple but years they effects. the that only makes regression them the accident And regression inflation over an of use explicit estimation also calendar years the years, regresses the a of that One years. that not calendar method over is development

if that component it, great it. significantly. incurred has both over thought a pointed are for than the been most IBNR like, up so the earned while or up a more proxy people, that time claims Within The we you auto, case which been was and does the total has increasing those exposure. we of for of IBNR was for on put it Mike was I And job provision that our estimating, and on the development XXX%. estimate have actually claims department reported that about And think an much XX%; losses, important reserve out up casualty the IBNR period that our increase, premium that

that within there's not incurred So of but IBNR, pure for bit reported good pure IBNR, a claims. --

And done we've of how in think so terms of our don't a really not time good we in And of in lot has those we've matter The I prudent IBNR be reporting. history And the put but a yet. increase good we position. over a a described that total know the I over company, think job would just of incurred about in inflationary no effects, think really the period this of being really ones that reserve. I had estimating them, us

position all years I best are our had we think to developed in just now. in really our a a our in we've estimate reserves XX think that for and it's of good now favorably, manifested business right lines row

So reserving of your the think. That's that's part I part of question, it.

think years. an prior on want that's of to you paying to it because important adverse for don't part that be And development I have

of we're our we current in reserves. So in a terms good feel position

risk it, we getting and really we we're we loss in I the segmenting, in might here the a of and really side On rate. where each to rate, own not of doing same. throw that that contribution But its treating trends on think throw again, differentiating, of between we when treating We're terms the pricing merits. we're Spray cost risk estimate And Steve the segmentation in too. where contribute every ask I bit the think

are position our casualty. feel about good so And commercial we -- we in

If loss you we're of ratio just take add overall year, or it XX% and x-cap, and the XXX. to the calendar either accident under year expense ratio commercial our

property reserve the we're on a or in And so and the the on on too. both spot underwriting good and feel we side, pricing side

Michael Zaremski

is in coming releases. this earnings loss is Okay. because I reserve that's beneficiary are line -- I top helpful. previous I've ask parts, Great the of number to guess, from and down -- and think, the But deteriorating. And moving it's to workers there's underlying just quarter comps a and mostly tried a ratio the meaningful lot

are mostly reserve to years? on pricing? come causing helpful. trend older accident decreases much to or it years or Any of be frequency color out. that both And is due so other the Is in recent what's more mostly the severity better, is hand, So releases and it accident would

Steven Johnston

Steve again. is This Johnston Sure.

the whenever said, as underneath, The every our look on workers actuals Steve development. we happening set a for On the reserves with it's we and then expectation claims Spray terms is, settlement the on compensation been we reserving -- what and our to inflation contribute will our I'll department, coming around our in the basically side. certain the have in the But what's real in, we think that, the in department, underwriting with all touch we pricing is here department. reserving that effort these, the assumptions particularly of side, on been I reserve set team just can practices And pricing data at. touch said area company

favorable the been be. turning for just it's points out approach lines. you but to to a a want the careful those So sure reserving the terms be with have careful I'm And comp, pricing. the of eye the might in expectation. to of you a might to to know on comment favorable all keep in time there any actuals And workers that been what you take we have to longtail line, setting we matter in you Steve, again, be prudent of And of put expectations. have trends lot an comparing over

Stephen Spray

Yes, Mike. Steve Spray.

states compounding completely it's the team total effect. having a quarters. pricing, tell concur the On discussions Steve, I across to are you, prior NCCI with in But similar it's the here. had we've I rate effort a will few base been declines

we're only renewal agents rate. reps, field it on right of comp be are lines our risk in X But needs discipline business, much work selection all Of book. lines, is our sure making on getting our it have liability work business that to with professional risk a I Professional lines, comp really liability. smaller underwriters shows that new off pricing where Our our and working compensation pricing, the segment. the selections commercial in we and lines, the workers the is of think in

we no specifically the Just overall we about still looking that as workers there. and use base the talked our the that from the are analytics under -- the of at We rate have declines. but the tools Steve feel segmentation, the about accident year it's book compensation, results doubt and pressure good pricing of business,

Michael Zaremski

lastly that's lines excess helpful. Great Okay. just on surplus the and segments. And

was growth is maybe time, us I something one or remind could you this If too? it there acquisition that know Is that's sustainable? -- is Lloyd's segment in a there

Steven Johnston

that that E&S in the on CSU. CSU CGE, Lloyd's we is sustainable. that our I -- The feel feel the company, impact have would Yes. acquisition growth the any I say that not there would

the we've a on The as our there what's submission make in I considerably. pricing consistent it's pricing, improving it and in great going and note just and and been showing -- they would conditions marketplace. up well. got terms, the are stable have in E&S is is the counts their company appetite, experience underwriting Mike too I the that team, think

extremely still is proposition for agents attractive. Our our value

because I the of agencies and as of about the think we us our our company, in have with that I've more well. past E&S turning and to more proposition talked and value

growth we have the only So about but not we our trajectory too. profitability there feel good that

Michael Zaremski

answer. the ask you I I And don't could guess have best sometimes I just

insurance -- in company. a E&S fit usually the doesn't company just an So commercial traditional like

why have unique -- able have are to Is are the commercial or insurer? what you -- an E&S you analytics company, how something since to traditional a you are capabilities of So there? there more

Steven Johnston

Yes.

it, risk casualty is well, about little think not albeit is might tougher, we've -- I XX% be So all market. tremendous on admitted -- we've the to book, inherently for be of that business, it's of The built right? of traditional a team eligible a underwriting. going that just majority it the expertise E&S really one, for amount a

tab As feel doesn't a conditions would in might end proper borrowed an terms so the market. and admitted can that or you the get and the E&S example, have up it market pricing, that

outperforming and consistent in appetite industry in I we pricing. Where and why the the think on before, are our been we've the conditions differences, knitting, terms, E&S operation has like is entire And the our we to I to team market, wholesale and underwriters, our for broader agent said and their stuck policyholders go go a carriers. to retail the the value the different. is E&S The traditional proposition market is community our their then to route agents have E&S for the wholesale and the

We've have the our agents own our formed decision-makers of our our employees are underwriters direct the access brokerage, in to brokerage, company. E&S

is, thing now with operation. local agents, more our Cincinnati that well. on bear of think importantly, But them. all Insurance we E&S claims the of confidence our we big resources company other as business use The gave there's because I company several our a Most E&S to

our nonadmitted. agents brokerage market that of profit sharing commission lean both relationship E&S And mean. well include we on that run premium company Cincinnati admitted that, claims the top handle agents. a to our business the can have We So the of local and company and the arrangements. our Insurance with into return our losses will We more the from as overall as adjuster

they send some other better is business might. So us they that maybe feel we're E&S aligned agents perform with than our but to going

Operator

question Paul from Sandler Newsome line of next O'Neill. Your with the comes

Paul Newsome

on quarter. the Congrats

that's been stronger the has second. think weren't of you far the it the be why up third But insurance know most that, seeing commercial is I the same role? incrementally might of was comes case you that terribly maybe answer could I about not said dynamic But other but maybe, the increases could in companies that you quite the I more talk really the reported flat, so and in you that you're price One things just bad. think, quarter the with seeing what this call as maybe some not BCF

Stephen Spray

is this Paul, Steve Well, Spray.

to that. try me Let tackle

E&S. commercial, try to from and me personal tackle Let

all think great quarters. have to change we've rate We we're full tell the several the doing segmentation. on story. really that And retaining net a last focused had with we average our profitable level have we're that trying most focused What the over segments. reported But the I that have on We're working a doesn't we underwriting agents consistent margin. opportunity better really job feel At is to the business, in business execute. an

really larger drive look needed for that retention a good less And on are rate us. to apt is We spreads really that that's as feel our there business focused getting on we profit well.

or So our it retaining with results. comfortable we're We're business of and profitable more -- losing are we're market, in that our we rate It's either you're that. mix, it's -- seeing think some I of more and getting that to business. the changing

Now I'm talking on The going lines. story same commercial is there in that's personal primarily, is what about lines.

You can our see it results. in auto

auto the well. we've we're homeowner and in seeing personal continue that number going everybody on And improve in get reporting, results, volatility the as That home. certainly our It's on that's good sophistication to continue better going seen We and evolve. book to variability is well. pricing to and that as But there auto, as both on seeing is to some you're continues better.

we'll long, continue And the runaway it's everybody serve needed. a we is we homeowner, on think the is environment there positive news feel in and that and like rate we'll well and good we're

the low with of while. gotten profit for rate quarter continued Our over E&S levels a quarter company They've quarter has they've get over low rate quite single-digit that even to generated. single-digit

way look we that way at way up with agents, we and work So the really day-to-day at the our sums we look rate, the execution, Paul.

Steven Johnston

just And said. XXX% -- Paul, Steve I I agree add everything with this might just Steve. with is -- X,

casualty, a same and range in of scripts second commercial been the put out. talk that on release on a then the average. or points than the gaining higher the comment still Q in is little we we casualty we more it's a segmentation that about bit more little But the commercial about are put that and distribution the in that average bit With it's Steve's quarter it to press

Paul Newsome

of market. industry. and business as some on on segment your most seems in of notable commercial auto the are the the business home to the with you be people focusing what's Could -- as well -- perception your on That the happening your across

Stephen Spray

Sure. Yes. time. I now, role the leading I'm I real when to prior was lines. lived commercial Paul. this in And

we We I So is I And goes, auto This of starting serious this measure to it our focused just saw the mentioned urgency and taking a I close on is why again, speak and can from and with commercial back on But pricing risk we selection. of we in XXXX, started have reason we in I we're Spray. front XXXX issue. out think a really the where And -- aggressive action agents. Steve really it. can a in really the is took standpoint, that it piece to relationship got such I before, that sense segmentation believe really of really what I book.

a XXXX. we were as auto pretty rate pain, pushing. But were, have basis, agents our starting in necessary model. from as we far of our we how "an back we're that daily you and We few We delivering know change outlier" them, regularly causing we considerable so distribution hard on heard were

'XX, others pain I 'XX, quarter kind think in started really really away. beginning And and Well, fourth started noticing similar fast forward of, really, action. to because has gone taking that it's

you year to x-cap look our the it accident at is commercial on if auto, improve. continuing So

crossed We haven't line. finish the

to wanted the with feel where heading good we're I be. about and Now that can tell trajectory isn't we really But you ratio we loss where that.

Operator

Josh line Shanker with Deutsche from comes the question next Your Bank. of

Joshua Shanker

Congratulations. quarter. great Another

market? time So you've growth your noticed you're worth somebody how build that know to talked rate And a differently. to about I I started well this overtime morning, just question trying series. individual got a net doing in I wanted high the

talked getting them it much generated, you've business about of how about business, that new in you're in generated. terms change new most years it in to in premium sometimes you've tend business recently talked the Some some of

In planning the forward, total and terms the given this on own segment of of in disclosure? Are has a breaking terms talking clarity growth of you're out premium. its been good going this here, about you into

Michael Sewell

Mike is this Sewell. Josh,

We are would so personal planning out. of on and Go not we additional it some forth. would the on not that information now qualify be breaking GAAP still That a But not ahead, rules. whether or lines, part segment its within charts own Josh. the give as a separate under

Joshua Shanker

i same about we relative a lines, more Well be was high high or net the if whether we about two, of profitable margin may the in broadly? rate versus it's versus wondering, in talk whether more business personal And business the worth whole, profitability? lines worth can net level rate the about talk personal

Stephen Spray

Sure, Josh. This is Steve Spray.

how deliberate right start to about would net a X and first A XX% give $XXX -- was new When premium book high our about now, of net you book. $XXX million, XX% it's on this over we worth. high me is on it. break up it's I ago, total out you year little give worth, at approaching was being million, flavor XX% our written there. It's now about with, little net and started about years up can personal business over numbers It's worth. we really Let focusing I some think lines high

lines, Van high him to personal experience brought leads you well. net had years Heuvel all us I came leads nearly worth has as experience, an experienced, Den personal -- we've that people many tell of years will with worth got high net of who with XX Will XX

deliberate business because high broader over like market. and became the a into that outperformed worth of we were personal has as historically, experienced the through value We net Plus forms bring we overnight, that. our time, it XX-year all company coverage claims get So and company. a to we lines

this we're the for that with premiums homeowner may So larger I We beginning the of them, net year it as growing will fully natural losses some in expected We're have writing larger well. worth with the we there. very variability. did front, high from that was tell risks this as on business, a quarter-to-quarter experienced some that we losses progression have larger can also us larger bring inherent quarter variability. but homes third on you

dug see of to don't on any by trend each in We've one agency. geography We those.

name You it.

just inherent it's variability again, it's, think it's from expected. quarter-to-quarter, we So

continue well. front it going on that expect We forward to as

Now the runaway well. I industry, worth we're homeowner benefit reporting going in at earlier of what rate as competitors look And net and you many we the us think, goes is I the remain high to there. seeing kind some to the it's think if well, saying was are of pain that area as for will positive

Joshua Shanker

so -- we and robustly is Coast in And the I'm about that tri-state are in any is not the writing you're should we But New naturally, sticking on because sort your concentrated wrong. York? Can West places. expect than or talk concentration scaling started, your that is more X in of correct or years the reasons geographic the New York not with as of strategy, you me area if it's other for the I think just where you whether

Stephen Spray

Josh. a It's no. great Well, Yes. question,

Let me the clear into where -- agents. rolled we that with Northeast. We've centered net high of the me, in excuse country high country. It's running just appointed. believe up agents all the XX we're as not net have worth XX now out We're active, well. I across our worth across states, our states product

the are New is in of lot that the clientele a lot coast, growing a of also candidly, York -- we and Now growing in Northeast, in those on California. and are we

wild XX the losses it's our in We fire there, some flux experience say, me, slowed avoided actually were experienced undersized losses from we've by we the we been and total That didn't XX design. -- has growth California -- in our total excuse market and I past risks on and was either, experience about that losses. any loss declined. losses. that Now we and talk fire had would We is, and 'XX 'XX

is think our really solid So underwriting well. we there as

but bit are a to still slowed California we So completely has California. committed

good there, we it's that grow we'll opportunity, to that the a Does agents question, continue and too. Our answer Josh? think

Joshua Shanker

within that's then the little were you the were talk the of Yes, the you seem agencies. That's away next And that market taking as market, there does from entrench to it. do to that admitted of And on an about can XXXX? business It's a be lot E&S where like extent bit omen of looking great. great. in think for you market, easy, as in terms to your you happens competitors well course, there from you it will from never pull who but easier year a came business form was the expect past business

Steven Johnston

great Yes. a It's question.

I it's from kind of a that everywhere, Josh. little of think coming bit

terms in a still I and because of an little knitting cycle and in key think some have in think remained into continue back out, big the The -- way. is consistency for send a is we appetite of market to taking a that and our more of getting our the approach key value there bit that That's more their back underwriting I companies kind to is continue flux. flows they've forth that and and and agents, they're certainly a stable, pricing get E&S stayed have on company. word point trip market, to and just of to what between admitted us, and that continues stuck more just they writing. to admitted our based opportunities retrenching think E&S chunk -- and is business business though flowing still element of there's I Josh is on market our condition proposition the --

Operator

with from RBC. Dwelle of next Your Mark the question line comes

Mark Dwelle

of ground lot don't think maybe on. just two has more covered. other we've But the ask already I -- a question, I two think hit a been

First one for Mike.

the up rates declined. with any typically just And within that what of there if investment Or Just in for you're portion kind portfolio interest year? given is me having or strategically for different anything positioning? of you could just that there, portfolio doing remind reinvestment

Martin Hollenbeck

favoring kind more X interest treasury is couple years basis -- kind be front. tax-exempt seeing income really some in Sure. fixed that different you on year-to-date, income our exception which We versus yields don't purchase, on variables XXX pressure do determines There's skewed lot what the that's detain of taxable the Mark, really to of really would points Hollenbeck. of of in in the that this portfolio. will in Marty last X bonds. The a being as

the of hand, aftermath the financial very we other and a yields call were XX-year that or the a lost paper lot the those through in and I've not corporate bonds about bonds was during mentioned in high, crisis. maturities On prior it calls, calls, of have

out the good lost, seems we've feel bleeding The that, door on So of back be abating that we fairly yields is now. to worst been over. confident

if So interest we to the growth. income on for say, XX-year range. we think traction get X% X.X% get We let's treasury, example, can to, up the can some

typically on we again, that's with -- of the the will tax we go So point risk-adjusted, and choose that. kind got those adjusted yield curve yields

short and answer anything really So is, not much different. we're doing

Mark Dwelle

devastating that have expect to and to? probably been question, to event helpful any you substantial the too have fairly it's That's that for lost you. market big traditionally soon Is tornadoes there. Dallas, would And the in that's exposure a Okay. for But a particular. obviously, same some

Steven Johnston

This for time. obviously point that, on is seen Steve, We've don't on in is at claims too that. ground early people really comment the really but have we're to you and our getting it this specifics

Operator

Instructions]. of next line comes KBW. the Shields with And from question Meyer your [Operator

Meyer Shields

I was leases we a get line accident business. of breakdown reserve wondering year if could of the by 'XX

Steven Johnston

Yes.

Mike that, We have and up. it is pulling

Michael Sewell

'XX? year Accident

Steven Johnston

'XX.

Michael Sewell

Yes.

Meyer? is year-to-date asked basis, what you for, a So on

Meyer Shields

Yes. it Whatever's quarter? in or third

Michael Sewell

Yes.

the for for development XXXX. So reserve

on So we if drill these. of any can down

commercial Cincinnati we lines, XX.X%. Re, for lines, lines, surplus and X.X%; X.X%; had -- it for that X.X%; So actually was the personal was

X.X%. it was a overall, So

Steven Johnston

And percents. all those are

Michael Sewell

when lines That's percents. it said And was -- right. was exactly I all there. personal for X.X% the that are Those strengthening

Steven Johnston

So in thing. just of it dollars, total terms the whole was million in $XX for Meyer,

Michael Sewell

For the whole thing.

Meyer Shields

Understood. Right.

in trends I asking lines. anticipating you may comments can not this yes in other top your workers quick year-over-year look is casualty. questions. worsening that composition something light I'm that Okay, seeing ago continue? of about the I or for at years compensation that trends Two think. workers Are in higher favorable just we recognizing few loss a pick that When that's And the

Steven Johnston

it's the there. latter I think

turn with can picks like it the and -- be a that longtail just prudent just to line medical in that, in pays inflation a You small your movement way. with number big

we too aggressive So to difficult our there. approach, get don't want with prudent

Meyer Shields

helpful. want the than That's earlier finally, casualty. you by And you would've increased so design, wondering Okay. I'm do mentioned E&S predominantly casualty. that thought because have would I is that the is book less property submission there the flow

Steven Johnston

of side. over like, just book what size been a for general little our And It's liability little it's to the is -- design, you the premium average just E&S by Yes. a the looks on $X,XXX. flavor casualty give on Meyer,

on our or $X of limits So limits end, XX% our small there, less. profile the certainly are million

too. So for a kind of that gives feel you

XX% The there admitted the the of and would company between when it's on write an is XX% add is that we say casualty other other of line, up thing E&S, picking Cincinnati -- I Insurance the time business side. lines about

it liability condition really company it be might as an auto workers write price tough write premises will will and example the a property, Insurance where Cincinnati it liability, manufacturing concern exposure compensation. can that E&S So and product term, the underwrite appropriately, a has the then our

So that of XX% to time. happens the XX%

us So towards as driving casualty more well. that's

Operator

turn [Operator there that like questions. I'd Instructions]. to to call showing no the are I'm over further Mr. Johnston. back And

Steven Johnston

thanks a you, all of speaking again us joining We Thank today. you on call. done, and forward Katherine. fourth day. Have great quarter for our Well to to look you with

Operator

call. your today's Thank concludes gentlemen, for and this conference participation. Ladies you

You may disconnect. now

Cincinnati Financial (CINF) 25 Oct 192019 Q3 Earnings call transcript