Cincinnati Financial — Third Quarter 2026 Earnings Summary

Financial Performance:

• Net income for the third quarter of 2026 was $459 million ($2.96 per share), a 59% decrease from $1.122 billion ($7.11 per share) in the third quarter of 2025.
• Non-GAAP operating income for the third quarter of 2026 was $443 million ($2.86 per share), a 1% decrease from $449 million ($2.85 per share) in the prior year period.
• Total revenues for the third quarter of 2026 were $3.047 billion, an 18% decrease from $3.726 billion in the third quarter of 2025, primarily driven by a $657 million decrease in net investment gains.
• Investment income, net of expenses, for the third quarter of 2026 was $325 million, a 10% increase from $295 million in the prior year period.
• Net income for the nine months ended September 30, 2026, was $1.988 billion ($12.75 per share), a 16% increase from $1.717 billion ($10.88 per share) in the same period of 2025.
• Non-GAAP operating income for the nine months ended September 30, 2026, was $997 million ($6.39 per share), a 38% increase from $723 million ($4.58 per share) in the prior year period.
• Book value per share was $105.42 at September 30, 2026, up 7% from $98.76 at September 30, 2025.
• Cash dividends declared for the third quarter of 2026 were $0.94 per share, an 8% increase from $0.87 per share in the prior year period.
• Consolidated cash and total investments totaled $34.378 billion at September 30, 2026, a 4% increase from $33.214 billion at year-end 2025.

Guidance and Future Outlook:

• Management stated that the nine-month 2026 combined ratio of 95.8% is comfortably within the long-term target range of 92% to 98%.
• The company intends to continue increasing dividends to shareholders through the normal variability of investment and insurance markets.
• Growth strategies include the introduction of new specialty products through The Cincinnati Specialty Underwriters Insurance Company and Cincinnati Global Underwriting, and opportunistic growth of Cincinnati Re.

Business Segments and Product Lines:

• Property Casualty:
  • Earned premiums were $2.605 billion for the third quarter of 2026, a 5% increase from $2.484 billion in the prior year period.
  • Net written premiums grew 2% to $2.550 billion in the third quarter of 2026.
  • The combined ratio for the third quarter of 2026 was 90.9%, an increase of 2.7 percentage points from 88.2% in the prior year period.
  • The combined ratio for the nine months of 2026 was 95.8%, a 2.6 percentage point improvement from 98.4% in the prior year period.
  • New business written premiums were $315 million in the third quarter of 2026, down 12% from the prior year period.
• Commercial Lines:
  • Earned premiums were $1.270 billion for the third quarter of 2026, a 3% increase from $1.229 billion in the prior year period.
  • Net written premiums were flat at $1.199 billion in the third quarter of 2026.
  • The combined ratio for the third quarter of 2026 was 92.8%, an increase of 1.7 percentage points from 91.1% in the prior year period.
  • The combined ratio for the nine months of 2026 was 98.5%, an increase of 6.5 percentage points from 92.0% in the prior year period.
• Personal Lines:
  • Earned premiums were $888 million for the third quarter of 2026, a 6% increase from $838 million in the prior year period.
  • Net written premiums grew 1% to $957 million in the third quarter of 2026.
  • The combined ratio for the third quarter of 2026 was 90.3%, an increase of 2.1 percentage points from 88.2% in the prior year period.
  • The combined ratio for the nine months of 2026 was 95.6%, a 16.2 percentage point improvement from 111.8% in the prior year period.
• Excess and Surplus Lines:
  • Earned premiums were $187 million for the third quarter of 2026, a 7% increase from $174 million in the prior year period.
  • Net written premiums grew 5% to $184 million in the third quarter of 2026.
  • The combined ratio for the third quarter of 2026 was 89.4%, a 0.4 percentage point improvement from 89.8% in the prior year period.
  • The combined ratio for the nine months of 2026 was 89.7%, a 0.1 percentage point improvement from 89.8% in the prior year period.
• Life Insurance:
  • Net income of the life insurance subsidiary was $31 million for the third quarter of 2026, an 11% increase from $28 million in the prior year period.
  • Term life insurance earned premiums were $62 million for the third quarter of 2026, a 2% increase from $61 million in the prior year period.
  • Net income of the life insurance subsidiary for the nine months of 2026 was $87 million, a 16% increase from $75 million in the prior year period.

Market and Competitive Landscape:

• The company operates in a competitive market, balancing new business opportunities with underwriting discipline.
• Average renewal pricing increases for property casualty segments were in the low-single-digit percent range.
• Personal lines average renewal pricing increases were near the low end of the high-single-digit percent range.
• The company appointed 300 new agencies in the first nine months of 2026, including 44 that market only personal lines products.

Risks and Challenges:

• Catastrophe losses increased by 7.0 percentage points in the third quarter of 2026 compared to the prior year, moving closer to historical averages.
• Commercial lines catastrophe losses increased by 5.1 points for the nine-month period.
• Personal lines catastrophe losses increased by 12.1 points in the third quarter of 2026.
• The company faces risks related to loss reserves, claim frequency and severity, and the ability to manage catastrophe risk.
• Investment portfolio performance is subject to stock market volatility and interest rate fluctuations.

Management Commentary and Tone:

• Stephen M. Spray, President and CEO, expressed pride in the field claims teams for their efforts in resolving claims and helping communities.
• Management highlighted that the third quarter combined ratio reflects continued efforts in pricing segmentation and purposeful diversification.
• Management noted that the nine-month non-GAAP operating income increase of 38% demonstrates healthy performance.
• Management emphasized the company's ability to execute long-term strategies while increasing dividends due to ample capital.

Other Key Points:

• The value creation ratio for the first nine months of 2026 was 5.8%, compared to 13.8% for the same period in 2025.
• The value creation ratio for the third quarter of 2026 was -2.1%, compared to 8.9% in the prior year period.
• The company recognized a less than $1 million after-tax increase in the fair value of equity securities still held in the third quarter of 2026.
• The debt-to-total-capital ratio was 4.8% at September 30, 2026, compared to 4.9% at December 31, 2025.
• The bond portfolio had an average rating of A2/A at September 30, 2026.
• The equity portfolio represented 39.7% of total investments at September 30, 2026.