WS Investor
02 Nov 2026, 18:29
CNA Financial Falls 1.6% as Long-Term Care Reserve Charge and Weaker Underwriting Pressure Earnings
CNA Financial (NYSE: CNA) shares fell about 1.6% after the insurer reported a sharp decline in third-quarter 2026 earnings, driven by a long-term care reserve charge, weaker Property & Casualty underwriting and higher catastrophe losses.
Net income fell to $196 million, or $0.72 per share, from $403 million, or $1.48 per share, a year earlier. Core income declined to $203 million, or $0.75 per share, from $409 million, or $1.50 per share.
Property & Casualty core income decreased to $397 million from $456 million. The combined ratio worsened to 97.0% from 92.8%, while the underlying combined ratio increased to 94.2% from 91.3%. Catastrophe losses rose to $78 million pretax from $41 million, and the underlying loss ratio increased 2.2 points to 64.1%.
The largest earnings drag came from the Life & Group segment, which posted a core loss of $171 million versus a $22 million loss a year earlier. Results included a $137 million after-tax impact from CNA’s annual long-term care reserve assumption update. Management said recent investment portfolio actions are expected to almost entirely offset the economic impact over time, although that benefit is not reflected in current-period GAAP earnings.
Net written premiums in the P&C business increased 3%, with renewal premium changes of 3% and written rate growth of 2%. Net investment income totaled $635 million, supported by higher fixed-income income but partially offset by weaker limited partnership and equity returns.
The 1.6% decline appears to reflect the steep drop in earnings, deterioration in underwriting metrics and the sizable long-term care reserve charge. While management emphasized that the reserve impact should be largely offset economically by higher future investment income, investors appear to be focusing on the immediate pressure on profitability and the weaker combined ratio.
CNA Financial (NYSE: CNA) shares fell about 1.6% after the insurer reported a sharp decline in third-quarter 2026 earnings, driven by a long-term care reserve charge, weaker Property & Casualty underwriting and higher catastrophe losses.
Net income fell to $196 million, or $0.72 per share, from $403 million, or $1.48 per share, a year earlier. Core income declined to $203 million, or $0.75 per share, from $409 million, or $1.50 per share.
Property & Casualty core income decreased to $397 million from $456 million. The combined ratio worsened to 97.0% from 92.8%, while the underlying combined ratio increased to 94.2% from 91.3%. Catastrophe losses rose to $78 million pretax from $41 million, and the underlying loss ratio increased 2.2 points to 64.1%.
The largest earnings drag came from the Life & Group segment, which posted a core loss of $171 million versus a $22 million loss a year earlier. Results included a $137 million after-tax impact from CNA’s annual long-term care reserve assumption update. Management said recent investment portfolio actions are expected to almost entirely offset the economic impact over time, although that benefit is not reflected in current-period GAAP earnings.
Net written premiums in the P&C business increased 3%, with renewal premium changes of 3% and written rate growth of 2%. Net investment income totaled $635 million, supported by higher fixed-income income but partially offset by weaker limited partnership and equity returns.
The 1.6% decline appears to reflect the steep drop in earnings, deterioration in underwriting metrics and the sizable long-term care reserve charge. While management emphasized that the reserve impact should be largely offset economically by higher future investment income, investors appear to be focusing on the immediate pressure on profitability and the weaker combined ratio.
