NU Online News Service, Feb. 6, 3:10 p.m. EST

Chicago-based insurer CNA says 2011 fourth-quarter net income dropped 37 percent on the combination of lower net-investment income, catastrophe losses and reserve charges in its life business.

The company says fourth-quarter net income was $190 million, down $112 million from the 2010 fourth quarter.

Property and casualty net written premiums increased 3 percent, or $46 million, to $1.5 billion. The combined ratio for the company improved 2.4 points to 87.2.

For the year, the company says net income dropped 11 percent, or $76 million, to $614 million. P&C net written premiums increased 5 percent or $323 million to $6.22 billion. The combined ratio rose 3.6 points to 98.4.

During the fourth quarter, CNA experienced catastrophe losses of $11 million, compared to $14 million in 2010. For the year, catastrophe losses in 2011 stood at $144 million compared to $79 million the previous year.

The company increased insurance reserves in its life segment by $148 million for its annuity and long term care business.

Discussing the results during a financial analyst's conference call, Thomas F. Motamed, chairman and chief executive officer of CNA, says the company saw improved underwriting profitability in P&C commercial and specialty business. He adds that the company is pleased that the “market is accepting rate increases after a long period of rate decreases,” and notes that the company will continue to “focus on the fundamentals.”

“We are only writing business at the right price the first time to bring it in the door and then we are constantly looking to push rate once it's in the door,” says Motamed.

Special Reports /

CNA 4Q Net Income Drops 37%

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