Cincinnati Financial has reported an expected second-quarter pre-tax catastrophe losses from severe weather of around $65m as of June 10, 2010, for its property casualty insurance operations through The Cincinnati Insurance Companies.
Catastrophe losses affect property casualty insurance underwriting income, one of the sources of consolidated net income along with profits from investment operations and life insurance operations.
The company said that its storm losses typically rise in the second quarter, averaging 7.7% points over the past 10 years compared with a full-year average of 4.2% points. If no additional catastrophe losses are incurred beyond those the company estimated through June 10, the company’s 2010 second-quarter estimate would stand at approximately nine percentage points, bringing the company’s early estimate for the first half to approximately 5.6 percentage points.
Kenneth Stecher, president and CEO of Cincinnati, said: “A total of eight events, including a storm in June that primarily affected our policyholders in northern Ohio, together accounted for approximately half of our policyholders’ estimated second-quarter catastrophe losses.
“The other half was largely due to claims in Nashville, Tennessee for water-damaged business equipment and related business interruption.”