CNA Financial (CNA -0.86%), a major commercial property and casualty insurance group, posted its second quarter 2025 earnings on August 4, 2025. The most notable news was robust core profitability, with non-GAAP core earnings per share of $1.23, above consensus estimates of $0.97. Investment income and commercial premium growth drove the upside, even as net income (GAAP) slipped year over year. The quarter reflected solid premium growth and underwriting improvements. Reserve charges in legacy exposures weighed on net results and highlight ongoing risks.

MetricQ2 2025Q2 2025 EstimateQ2 2024Y/Y Change
EPS (Non-GAAP, Core income per diluted share)$1.23$0.97$1.193.4%
Net Income$299 million$317 million(5.7%)
Core Income (Non-GAAP)$335 million$326 million2.8%
Property & Casualty Core Income (Non-GAAP)$448 million$380 million17.9%
Net Investment Income$662 million$618 million7.1%
Property & Casualty Combined Ratio94.1%94.8%(0.7) pp

Source: Analyst estimates for the quarter provided by FactSet.

Understanding CNA Financial’s Business and Recent Focus Areas

CNA Financial operates as a diversified insurance carrier, mainly providing commercial property and casualty policies for businesses in North America and select markets worldwide. Its core divisions include Specialty, which covers professional liability and other niche risks, Commercial, which offers a broad range of corporate insurance products, and International, which addresses client needs in overseas markets.

Regulatory compliance is a non-negotiable part of business, as insurance companies must maintain adequate capital and robust risk management procedures. The ability to grow new business, achieve expense efficiency, and maintain underwriting discipline are key to its ongoing success. Financial health hinges on investment returns and prudent claims reserving, especially because insurance profits depend on accurately projecting and covering claims costs.

Excluding business via third party captives, gross written premium increased 5%, net written premium grew 6%, and new business premiums jumped 8%, hitting $645 million. Commercial lines saw especially notable growth, with net earned premium in this segment rising 12% year-over-year on a GAAP basis. Renewal pricing remained firm, with written rates up 3% and overall renewal premium change up 5%.

Underwriting results improved as the combined ratio for the core property and casualty business, which measures insurance losses and expenses as a percentage of premium income, fell to 94.1%. A ratio under 100 % indicates an underwriting profit. This improvement reflects fewer catastrophe-related claims and a lower expense ratio of 29.8%, now below 30% for the first time since 2008. Catastrophe losses, such as those from severe storms or natural disasters, were $62 million, well beneath the five-year average for this season and down from last year. The P&C segment registered an underwriting gain (non-GAAP) of $150 million, up 21% from the prior year.

By segment, Its underwriting gain nearly doubled to $74 million, and Specialty, which focuses on professional and niche liability products, posted a small dip in underwriting profit, and International reported premium growth but a slight decrease in underwriting gain. Meanwhile, Life & Group, mostly in runoff, managed to break even. A common measure of insurance performance, the underlying loss ratio (non-GAAP), inched up in each segment, particularly in commercial auto insurance, which management flagged as an area with rising claims severity.

The quarter highlighted one key risk: reserve charges related to legacy mass tort liabilities. CNA booked an $88 million after-tax charge for prior period development, up from $28 million in Q2 2024. Reserve strengthening relates to cases where previously set aside funds for old liability exposures are found insufficient, requiring a one-time additional charge that directly reduces earnings. This development stemmed partly from an anticipated legal agreement concerning the Diocese of Rochester. Management stated, “The current year quarter includes an $88 million after-tax charge related to unfavorable prior period development associated with legacy mass tort compared with a $28 million after-tax charge in Q2 2024.”

Net investment income increased 7%, as both fixed income and alternative investments posted gains. The company’s statutory capital and surplus stood at $11.2 billion, and the book value per share reached $39.39, or $45.25 excluding accumulated other comprehensive income. This speaks to strong financial flexibility. In the insurance industry, these capital and surplus figures measure the cushion that protects policyholders and underpins regulatory compliance.

Dividend policy remained consistent during the period. The quarterly dividend was maintained at $0.46 per share. This rate marks a continuation of steady shareholder returns, with dividends paid year to date totaling $2.92 per share.

Management did not provide a quantitative outlook or forward earnings guidance for the rest of fiscal 2025. The company did, however, express confidence in statements such as, “We are well positioned and confident in our abilities to execute on the many opportunities to grow profitably for the remainder of the year.”

Investors and market participants will likely keep an eye on developments in loss ratio trends, particularly in areas like commercial auto, where rising claims severity could weigh on future results. Continued monitoring of reserve adequacy for older exposures, such as mass tort liabilities, remains important after this quarter’s reserve charge. New business growth, investment income, and maintenance of capital strength will be central themes for CNA as the year progresses.

The quarterly dividend was maintained at $0.46 per share.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.