Cincinnati Financial Corporation posted a property casualty combined ratio of 100.8% in the second quarter of 2026, up 5.9 percentage points from 94.9% in the same period last year, as elevated catastrophe losses pushed the company to an underwriting loss for the quarter.
Property casualty catastrophe losses accounted for 14.4 percentage points of the loss ratio in the second quarter, up from 12.4 points a year earlier. Ohio was a particularly active loss state, with catastrophe losses running nearly four times higher than the company's five-year second-quarter average for the state.
The commercial lines segment absorbed the sharpest deterioration. Its combined ratio widened to 104.1% from 92.9%, a swing of 11.2 percentage points, with catastrophe losses adding 4.9 points.
Personal lines posted a 2.1 percentage-point improvement to 99.9%, as that segment's catastrophe load fell 1.6 points year over year. The excess and surplus lines segment continued to produce an underwriting profit, with its combined ratio at 90.5%, down 0.6 points from 91.1%.
On a six-month basis, the combined ratio stood at 98.2%, a 5.6 percentage-point improvement from 103.8% in the first half of 2025. Catastrophe losses in the period ran well below the elevated levels of a year earlier.
"We are optimistic that further maturing of our plans to increase both product and geographic diversification will continue to help mute the impacts of catastrophe losses in any one quarter," said Stephen M. Spray, president and chief executive officer of Cincinnati Financial.
Prior accident year reserve development added a favorable 1.7 percentage points in the quarter, equivalent to $42 million. That compared with a 2.6-point benefit of $63 million in the second quarter of 2025.
Net written premiums rose 3% to $2.825 billion in the quarter, supported by renewal pricing increases and higher insured exposures. New business written premiums declined 13% to $353 million, with the decrease concentrated in personal lines.
"To help keep our pipeline of opportunities full, we continue to appoint new agencies in geographies where we see the best prospects for profitable growth," Spray said. "So far this year, we've appointed more than 200 agencies. With total agency relationships still under 3,000, we have a lot of runway to fuel growth without dampening the exclusivity of a Cincinnati contract that our current agents enjoy."
Spray said investment income was the main source of profits for the quarter. Pretax investment income rose 12% to $319 million, with bond interest income up 14%.
Non-GAAP operating income for the first half totaled $554 million. For the quarter, non-GAAP operating income was $224 million, or $1.43 per share, down 28% from $311 million, or $1.97 per share, a year earlier. The $87 million decrease included a $61 million after-tax impact from higher catastrophe losses.
GAAP net income was $1.255 billion, or $8.05 per share, compared with $685 million, or $4.34 per share, in the second quarter of 2025. The increase was driven by an $882 million after-tax rise in the fair value of equity securities still held.
The life insurance subsidiary reported net income of $30 million, up $4 million from a year earlier, with term life earned premiums growing 5%.
Book value per share reached $108.64 at June 30, a record high and up $6.29 since year-end 2025. The value creation ratio for the first half of 2026 was 8.0%, compared with 4.6% for the same period last year.
Cincinnati Financial declared a quarterly cash dividend of $0.94 per share, up 8% from the second quarter of 2025.
