CNA cuts prices and volume

Q1 losses blamed on investment but rates a volumes fall too

CNA has announced Q1 loss of $195m because of investment losses and lower business volumes at falling prices.

Financial highlights (2008Q1 in brackets)

Net operating income $149m ($221m)
Net realized investment losses $344m ($33m)
Net income/loss from continuing operations -$195m ($188m)
Net income/loss -$195m ($187m)
Combined ratio for P&C 98.2% (98.1%)
Standard lines GWP $829 ($832m)
Specialty lines GWP $1,276m ($1,293m)
Total P&C GWP $2,105m ($2,125m)
Standard lines averaged rate decreases of 2% (6%)
Specialty lines averaged rate decreases of 2% (3%).

Thomas Motamed, recently appointed chairman and chief executive said: “After four months at CNA, I am more confident than ever in our company’s position and franchise in both the specialty lines and standard lines markets.

“Our first quarter results continue to reflect the turmoil in the capital markets and its impact on our investment income and realised investment results.”