NU Online News Service, Nov. 2, 3:14 p.m. EST

CNA Financial Corporation reported third-quarter net income of $263 million, a $594 million improvement over a net loss of $331 million for the period last year.

The Chicago-based commercial insurer credited the improvement to lower catastrophe losses, higher net investment income, and a $61 million after-tax gain from a settlement resolving litigation related to the placement of personal accident reinsurance. But an unfavorable change in current accident-year underwriting results excluding catastrophes partially offset the favorable factors, according to the company.

For the first nine months of 2009, CNA reported net income of $173 million, a 368 percent increase over the $37 million net income figure reported for the same period in 2008.

For its property and casualty operations in the third quarter, CNA reported gross written premiums of $1.9 billion, down from $2.1 billion in the 2008 third quarter. Standard lines dropped to $711 million from $804 million, and specialty lines dropped to $1.2 billion from $1.3 billion.

Net written premiums in the quarter decreased $91 million for standard lines to $632 million from $723 million. The company blamed the decrease on current economic conditions.

Net written premiums for specialty lines in the quarter decreased $30 million to $845 million from $875 million. "This decrease reflects lower net written premiums for CNA Global, partially offset by growth in U.S. specialty lines," CNA said.

Strong rate increases in the financial institutions and directors and officers lines drove the modest growth in U.S. specialty, the company said.

The 2009 third-quarter combined ratio improved to 101 from 107 in 2008.

Thomas F. Motamed, chairman and chief executive officer of CNA, said, "In our core property and casualty operations, we are pleased with the continued strong performance of the specialty lines segment. We continue to focus on improving profitability in the standard lines segment. Rate trends are encouraging across our portfolio. However, the recession has reduced exposures, putting downward pressure on premium volume."

On the investment side, the company reported net realized investment losses of $67 million for the 2009 third quarter compared to net realized losses of $423 million a year ago. CNA said decreased other-than-temporary impairment losses led to the improvement.

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CNA 3Q Net Income Back In Positive Territory

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