What changed in this filing

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Item 2. Management’s Discussion and Analysis

2022-10-31 compared with 2022-08-01 · 251 added, 203 removed, 382 unchanged (54% of the section changed)

20 unchanged sentences

Claims of creditors of our subsidiaries will generally have priority as to the assets of such subsidiaries over our claims and those of our creditors and shareholders.

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We are not responsible for the liabilities and obligations of our subsidiaries and there are no Parent Company guarantees.

RESULTS OF OPERATIONS

Consolidated Financial Results

The following table summarizes net income (loss) attributable to Loews Corporation by segment and net income (loss) per share attributable to Loews Corporation for the three and six months ended June 30, 2022 and 2021:

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

7 unchanged sentences

Diluted net income per share $ 0.54 $ 0.85 $ 2.64 $ 4.70

Net income attributable to Loews Corporation for the three months ended June 30, 2022 was $180 million, or $0.73 per share, compared to $754 million, or $2.86 per share in the comparable 2021 period.

Net income attributable to Loews Corporation for the six months ended June 30, 2022 was $518 million, or $2.09 per share, compared to $1.0 billion, or $3.82 per share in the comparable 2021 period.

The Corporate segment includes a gain of $438 million (after tax) related to the sale of 47% of Altium Packaging and its deconsolidation in the second quarter of 2021.

Excluding this significant transaction, the decrease in net income attributable to Loews Corporation for the three months ended June 30, 2022 as compared to the comparable prior year period, was primarily driven by lower net investment income from limited partnership and common stock investments and net investment losses recognized in the second quarter of 2022 compared to net investment gains in the comparable prior year period.

This decline was partially offset by higher property & casualty underwriting income and higher net investment income from fixed income securities at CNA and significantly improved results at Loews Hotels & Co .

The drivers of the decrease in net income for the six months ended June 30, 2022 as compared to the comparable 2021 period are consistent with the three-month discussion above.

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Net income attributable to Loews Corporation for the three months ended September 30, 2022 was $130 million, or $0.54 per share, compared to $220 million, or $0.85 per share in the comparable 2021 period.

Net income attributable to Loews Corporation for the nine months ended September 30, 2022 was $648 million, or $2.64 per share, compared to $1.2 billion, or $4.70 per share in the comparable 2021 period.

Net income attributable to Loews Corporation in the third quarter of 2022 as compared to the comparable 2021 period included higher underwriting income and increased net investment income from fixed income securities at CNA and improved results at Loews Hotels & Co offset by losses from limited partnership and common stock investments and net investment losses from sales of fixed income securities at CNA.

The Corporate segment included a gain of $438 million (after tax) related to the sale of 47% of Altium Packaging and its deconsolidation in the nine months ended September 30, 2021.

Excluding this significant transaction, the drivers of the decrease in net income attributable to Loews Corporation for the nine months ended September 30, 2022 as compared to the comparable 2021 period are consistent with the three-month discussion above.

CNA Financial

The following table summarizes the results of operations for CNA for the three and six months ended June 30, 2022 and 2021 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

The following table summarizes the results of operations for CNA for the three and nine months ended September 30, 2022 and 2021 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

For further discussion of Net investment income and Investment gains (losses), see the Investments section of this MD&A.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

17 unchanged sentences

Net income attributable to Loews Corporation $ 115 $ 229 $ 579 $ 838

Three Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $147 million for the three months ended June 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and investment losses for the three months ended June 30, 2022 as compared with investment gains in the comparable 2021 period.

Lower net investment income was from limited partnerships and common stock and lower investment results were driven by the unfavorable change in fair value of non-redeemable preferred stock.

These decreases to net income were partially offset by improved underwriting results and higher net investment income from fixed income securities for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Catastrophe losses were $37 million ($26 million after tax and noncontrolling interests) for the three months ended June 30, 2022 as compared with $54 million ($38 million after tax and noncontrolling interests) in the comparable 2021 period and were primarily related to severe weather related events.

Six Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $145 million for the six months ended June 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and investment losses for the six months ended June 30, 2022 as compared with investment gains in the comparable 2021 period.

Lower net investment income was from limited partnerships and common stock and lower investment results were driven by the unfavorable change in fair value of non-redeemable preferred stock.

These decreases to net income were partially offset by improved underwriting results and higher net investment income from fixed income securities for the six months ended June 30, 2022

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as compared with the comparable 2021 period.

Catastrophe losses were $57 million ($40 million after tax and noncontrolling interests) for the six months ended June 30, 2022 as compared with $179 million ($126 million after tax and noncontrolling interests) in the comparable 2021 period and were primarily related to severe weather related events.

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $114 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and investment losses for the three months ended September 30, 2022 as compared with investment gains in the comparable 2021 period.

Lower net investment income was driven by unfavorable limited partnership and common stock results and lower investment results were driven by net losses on fixed maturity securities.

These decreases to net income were partially offset by improved underwriting results and higher net investment income from fixed income securities for the three months ended September 30, 2022 as compared with the comparable 2021 period.

Catastrophe losses were $114 million ($80 million after tax and noncontrolling interests) for the three months ended September 30, 2022 as compared with $178 million ($125 million after tax and noncontrolling interests) in the comparable 2021 period.

Catastrophe losses for the three months ended September 30, 2022 were driven by severe weather related events, including $87 million for Hurricane Ian.

Catastrophe losses for the three months ended September 30, 2021 included $114 million for Hurricane Ida.

Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $259 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and investment losses for the nine months ended September 30, 2022 as compared with investment gains in the comparable 2021 period.

Lower net investment income was driven by unfavorable limited partnership and common stock results and lower investment results were driven by the unfavorable change in fair value of non-redeemable preferred stock and net losses on fixed maturity securities.

These decreases to net income were partially offset by improved underwriting results and higher net investment income from fixed income securities for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

Catastrophe losses were $171 million ($121 million after tax and noncontrolling interests) for the nine months ended September 30, 2022 as compared with $357 million ($251 million after tax and noncontrolling interests) in the comparable 2021 period.

Catastrophe losses for the nine months ended September 30, 2022 were driven by severe weather related events, including $87 million for Hurricane Ian.

Catastrophe losses for the nine months ended September 30, 2021 were driven by severe weather related events, primarily Hurricane Ida and Winter Storms Uri and Viola.

CNA’s Property & Casualty and Other Insurance Operations

27 unchanged sentences

Gross written premiums, excluding third-party captives, excludes business which is ceded to third-party captives, including business related to large warranty programs.

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The following tables summarize the results of CNA’s Property & Casualty Operations for the three and six months e nded June 30, 2022 and 2021.

Three Months Ended June 30, 2022 Specialty

The following tables summarize the results of CNA’s Property & Casualty Operations for the three and nine months e nded September 30, 2022 and 2021.

Three Months Ended September 30, 2022 Specialty

International

19 unchanged sentences

New business $ 130 $ 246 $ 79 $ 455

Three Months Ended June 30, 2021

Three Months Ended September 30, 2021

Gross written premiums $ 1,953 $ 1,010 $ 276 $ 3,239

17 unchanged sentences

New business $ 147 $ 204 $ 54 $ 405

Table of c o ntents

Six Months Ended June 30, 2022 Specialty

Nine Months Ended September 30, 2022 Specialty

International

19 unchanged sentences

New business $ 407 $ 754 $ 245 $ 1,406

Six Months Ended June 30, 2021

Nine Months Ended September 30, 2021

Gross written premiums $ 5,650 $ 3,284 $ 958 $ 9,892

17 unchanged sentences

New business $ 370 $ 615 $ 204 $ 1,189

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Three Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Gross written premiums, excluding third-party captives, for Specialty increased $76 million for the three months ended June 30, 2022 as compared with the comparable 2021 period driven by rate and higher new business.

Net written premiums for Specialty increased $46 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the three months ended June 30, 2022 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $268 million for the three months ended June 30, 2022 as compared with the comparable 2021 period driven by higher new business and retention.

Net written premiums for Commercial increased $303 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

The prior period included a one-time written premium catch-up resulting from the addition of a quota share treaty to CNA’s property reinsurance program.

Excluding the impact of the written premium catch-up in the prior period, net written premiums increased $191 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Prior period written premiums were also unfavorably impacted by the March 2021 cybersecurity attack.

The increase in net earned premiums for the three months ended June 30, 2022 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $43 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, gross written premiums increased $59 million driven by retention and rate.

Net written premiums for International increased $38 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, net written premiums increased $52 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the three months ended June 30, 2022 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations decreased $34 million for the three months ended June 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income driven by limited partnership and common stock results, partially offset by improved underwriting results.

Total catastrophe losses were $37 million for the three months ended June 30, 2022 as compared with $54 million for the comparable 2021 period.

For the three months ended June 30, 2022 and 2021, Specialty had $1 million of catastrophe losses, Commercial had catastrophe losses of $29 million and $51 million and International had catastrophe losses of $7 million and $2 million.

Favorable net prior year loss reserve development of $37 million and $11 million was recorded for the three months ended June 30, 2022 and 2021.

For the three months ended June 30, 2022 and 2021, Specialty recorded favorable net prior year loss reserve development of $10 million in each period, Commercial recorded favorable net prior year loss reserve development of $22 million and no net prior year loss reserve development and International recorded favorable net prior year loss reserve development of $5 million and $1 million.

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Gross written premiums, excluding third-party captives, for Specialty increased $15 million for the three months ended September 30, 2022 as compared with the comparable 2021 period driven by retention and rate.

Net written premiums for Specialty increased $18 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the three months ended September 30, 2022 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $177 million for the three months ended September 30, 2022 as compared with the comparable 2021 period driven by higher new business and rate.

Net written premiums for Commercial increased $131 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the three months ended September 30, 2022 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $12 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, gross written premiums increased $31 million driven by higher new business and rate.

Net written premiums for International increased $2 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, net written premiums increased $19 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

Net earned premiums for the three months ended September 30, 2022 were consistent with the comparable 2021 period for International.

Core income for Property & Casualty Operations increased $43 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to improved underwriting results and higher net investment income from fixed income securities partially offset by lower net investment income from limited partnerships and common stock results.

Total catastrophe losses were $114 million for the three months ended September 30, 2022 as compared with $178 million for the comparable 2021 period.

For the three months ended September 30, 2022 and 2021, Specialty had catastrophe losses of $1 million and $3 million, Commercial had catastrophe losses of $103 million and $166 million and International had catastrophe losses of $10 million and $9 million.

Favorable net prior year loss reserve development of $17 million and $10 million was recorded for the three months ended September 30, 2022 and 2021.

For the three months ended September 30, 2022 and 2021, Specialty recorded favorable net prior year loss reserve development of $15 million in each period, Commercial recorded favorable net prior year loss reserve development of $2 million and unfavorable net prior year loss reserve development of $2 million and International recorded no net prior year loss reserve development and unfavorable net prior year loss reserve development of $3 million.

Further information on net prior year loss reserve development is included in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 0.2 points for the three months ended June 30, 2022 as compared with the comparable 2021 period due to a 0.4 point increase in the expense ratio partially offset by a 0.2 point improvement in the loss ratio.

The increase in the expense ratio was driven by higher underwriting expenses partially offset by lower acquisition costs.

The improvement in the loss ratio was primarily driven by improved non-catastrophe current accident year underwriting results.

Commercial’s combined ratio improved 6.4 points for the three months ended June 30, 2022 as compared with the comparable 2021 period primarily due to a 4.0 point improvement in the loss ratio and a 2.3 point improvement in the expense ratio.

The improvement in the loss ratio was driven by lower catastrophe losses which were 3.0 points of the loss ratio for the three months ended June 30, 2022, as compared with 5.8 points of the loss ratio in the comparable 2021 period and favorable net prior year loss reserve development.

The combined ratio excluding catastrophes and development improved 1.0 point for the three months ended June 30, 2022 as compared with the comparable 2021 period.

The improvement in the expense ratio of 2.3 points was driven by lower acquisition costs and higher net earned premium partially offset by an increase in underwriting expenses.

The loss ratio excluding catastrophes and development increased 1.4 points primarily driven by a shift in mix of business associated with the property quota share treaty purchased during June of 2021.

Property coverages, which have a lower underlying loss ratio than most other commercial coverages, now represent a smaller proportion of net earned premiums.

Table of c o ntents

International’s combined ratio improved 1.4 points for the three months ended June 30, 2022 as compared with the comparable 2021 period due to a 1.4 point improvement in the expense ratio driven by lower acquisition costs.

The loss ratio for the three months ended June 30, 2022 was consistent with the comparable 2021 period as favorable net prior year loss reserve development and improved non-catastrophe current accident year underwriting results were offset by higher catastrophe losses.

Catastrophe losses were 2.8 points of the loss ratio for the three months ended June 30, 2022, as compared with 0.8 points of the loss ratio in the comparable 2021 period.

Six Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Gross written premiums, excluding third-party captives, for Specialty increased $145 million for the six months ended June 30, 2022 as compared with the comparable 2021 period driven by rate and higher new business.

Net written premiums for Specialty increased $75 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the six months ended June 30, 2022 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $363 million for the six months ended June 30, 2022 as compared with the comparable 2021 period driven by higher new business and retention.

Net written premiums for Commercial increased $344 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

Specialty’s combined ratio increased 0.5 points for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a 1.1 point increase in the expense ratio largely offset by a 1.0 point improvement in the loss ratio.

The increase in the expense ratio was largely due to higher underwriting expenses driven by investments in technology and talent.

The improvement in the loss ratio was primarily driven by improved current accident year underwriting results.

Commercial’s combined ratio improved 9.7 points for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a 9.1 point improvement in the loss ratio and a 0.5 point improvement in the expense ratio.

The improvement in the loss ratio was primarily driven by lower catastrophe losses which were 10.0 points of the loss ratio for the three months ended September 30, 2022, as compared with 18.6 points of the loss ratio in the comparable 2021 period.

The improvement in the expense ratio of 0.5 points was driven by higher net earned premiums and lower acquisition costs partially offset by an increase in underwriting expenses.

International’s combined ratio improved 1.1 points for the three months ended September 30, 2022 as compared with the comparable 2021 period due to a 0.7 point improvement in the loss ratio and a 0.4 point improvement in the expense ratio.

The improvement in the loss ratio was primarily due to improved non-catastrophe underwriting results.

Catastrophe losses were 4.1 points of the loss ratio for the three months ended September 30, 2022, as compared with 3.4 points of the loss ratio in the comparable 2021 period.

The improvement in the expense ratio of 0.4 points was primarily driven by lower acquisition costs partially offset by an increase in underwriting expenses.

Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Gross written premiums, excluding third-party captives, for Specialty increased $160 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period driven by retention and higher new business.

Net written premiums for Specialty increased $93 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the nine months ended September 30, 2022 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $540 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period driven by higher new business and retention.

Net written premiums for Commercial increased $475 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

The prior period included a one-time written premium catch-up resulting from the addition of a quota share treaty to CNA’s property reinsurance program.

Excluding the impact of the prior period written premium catch-up, net written premiums increased $232 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the six months ended June 30, 2022 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $63 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, gross written premiums increased $90 million driven by retention and rate.

Net written premiums for International increased $54 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, net written premiums increased $78 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the six months ended June 30, 2022 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $24 million for the six months ended June 30, 2022 as compared with the comparable 2021 period primarily due to improved underwriting results largely offset by lower net investment income driven by limited partnership and common stock results.

Total catastrophe losses were $57 million for the six months ended June 30, 2022 as compared with $179 million for the comparable 2021 period.

For the six months ended June 30, 2022 and 2021, Specialty had catastrophe losses of $1 million and $6 million, Commercial had catastrophe losses of $45 million and $166 million and International had catastrophe losses of $11 million and $7 million.

Favorable net prior year loss reserve development of $49 million and $26 million was recorded for the six months ended June 30, 2022 and 2021.

For the six months ended June 30, 2022 and 2021, Specialty recorded favorable net prior year loss reserve development of $20 million and $25 million, Commercial recorded favorable net prior year loss reserve development of $24 million and no net prior year loss reserve development and International recorded favorable net prior year loss reserve development of $5 million and $1 million.

Excluding the impact of the prior period written premium catch-up, net written premiums increased $363 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the nine months ended September 30, 2022 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $75 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, gross written premiums increased $121 million driven by higher new business and retention.

Net written premiums for International increased $56 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

Excluding the effect of foreign currency exchange rates, net written premiums increased $97 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

The increase in net earned premiums for the nine months ended September 30, 2022 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $67 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to improved underwriting results and higher net investment income from fixed income securities partially offset by lower net investment income from limited partnership and common stock results.

Total catastrophe losses were $171 million for the nine months ended September 30, 2022 as compared with $357 million for the comparable 2021 period.

For the nine months ended September 30, 2022 and 2021, Specialty had catastrophe losses of $2 million and $9 million, Commercial had catastrophe losses of $148 million and $332 million and International had catastrophe losses of $21 million and $16 million.

Favorable net prior year loss reserve development of $66 million and $36 million was recorded for the nine months ended September 30, 2022 and 2021.

For the nine months ended September 30, 2022 and 2021, Specialty recorded favorable net prior year loss reserve development of $35 million and $40 million, Commercial recorded favorable net prior year loss reserve development of $26 million and unfavorable net prior year loss reserve development of $2 million and International recorded favorable net prior year loss reserve development of $5 million and unfavorable net prior year loss reserve development of $2 million.

Further information on net prior year loss reserve development is included in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 0.1 point for the six months ended June 30, 2022 as compared with the comparable 2021 period due to a 0.5 point increase in the expense ratio largely offset by a 0.4 point improvement in the loss ratio.

The increase in the expense ratio was driven by higher underwriting expenses partially offset by higher net earned premiums.

Specialty’s combined ratio increased 0.2 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a 0.6 point increase in the expense ratio largely offset by a 0.5 point improvement in the loss ratio.

The increase in the expense ratio was largely due to higher underwriting expenses driven by investments in technology and talent.

The improvement in the loss ratio was primarily driven by improved current accident year underwriting results.

Catastrophe losses were 0.1 point of the loss ratio for the six months ended June 30, 2022, as compared with 0.3 points of the loss ratio in the comparable 2021 period.

Commercial’s combined ratio improved 9.3 points for the six months ended June 30, 2022 as compared with the comparable 2021 period primarily due to a 7.7 point improvement in the loss ratio and a 1.5 point improvement in the expense ratio.

The improvement in the loss ratio was driven by lower catastrophe losses which were 2.4 points of the loss ratio for the six months ended June 30, 2022, as compared with 9.6 points of the loss ratio in the comparable 2021 period, and favorable net prior year loss reserve development.

The combined ratio excluding catastrophes and development improved 0.5 points for the six months ended June 30, 2022 as compared with the comparable 2021 period.

Table of c o ntents

improvement in the expense ratio was driven by lower acquisition costs and higher net earned premiums partially offset by an increase in underwriting expenses.

Catastrophe losses were 0.1 point of the loss ratio for the nine months ended September 30, 2022, as compared with 0.4 points of the loss ratio in the comparable 2021 period.

Commercial’s combined ratio improved 9.4 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to an 8.0 point improvement in the loss ratio and a 1.3 point improvement in the expense ratio.

The improvement in the loss ratio was driven by lower catastrophe losses which were 5.0 points of the loss ratio for the nine months ended September 30, 2022, as compared with 12.6 points of the loss ratio in the comparable 2021 period, and favorable net prior year loss reserve development.

The combined ratio excluding catastrophes and development improved 0.7 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

The improvement in the expense ratio of 1.3 points was driven by higher net earned premiums and lower acquisition costs partially offset by an increase in underwriting expenses.

The loss ratio excluding catastrophes and development increased 0.7 points primarily driven by a shift in mix of business associated with the property quota share treaty purchased during June of 2021.

Property coverages, which have a lower underlying loss ratio than most other commercial coverages, now represent a smaller proportion of net earned premiums.

International’s combined ratio improved 2.4 points for the six months ended June 30, 2022 as compared with the comparable 2021 period due to a 1.5 point improvement in the expense ratio and a 0.9 point improvement in the loss ratio.

The improvement in the expense ratio was driven by lower acquisition costs.

The improvement in the loss ratio was driven by favorable net prior year loss reserve development and improved non-catastrophe current accident year underwriting results, partially offset by higher net catastrophe losses.

Catastrophe losses were 2.0 points of the loss ratio for the six months ended June 30, 2022, as compared with 1.4 points of the loss ratio in the comparable 2021 period.

International’s combined ratio improved 2.0 points for the nine months ended September 30, 2022 as compared with the comparable 2021 period due to a 1.2 point improvement in the expense ratio and a 0.8 point improvement in the loss ratio.

The improvement in the expense ratio was primarily driven by lower acquisition costs.

The improvement in the loss ratio was driven by improved non-catastrophe underwriting results, partially offset by higher net catastrophe losses.

Catastrophe losses were 2.7 points of the loss ratio for the nine months ended September 30, 2022, as compared with 2.0 points of the loss ratio in the comparable 2021 period.

Other Insurance Operations

The following table summarizes the results of CNA’s Other Insurance Operations for the three and six months ended June 30, 2022 and 2021.

Three Months Ended Six Months Ended

June 30, June 30,

The following table summarizes the results of CNA’s Other Insurance Operations for the three and nine months ended September 30, 2022 and 2021.

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

2 unchanged sentences

Net investment income 192 242 610 736

Core loss (72) (10) (77) (10)

Three Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Core results for Other Insurance Operations decreased $62 million for the three months ended June 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and a $51 million charge for the three months ended June 30, 2022 related to unfavorable net prior year loss reserve development largely associated with legacy mass tort abuse claims as compared with a $32 million charge in the comparable 2021 period.

Net prior year loss reserve development is further discussed in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1.

Six Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Core results for Other Insurance Operations decreased $67 million for the six months ended June 30, 2022 as compared with the comparable 2021 period primarily due to lower net investment income and higher net prior year loss reserve development associated with legacy mass tort abuse claims.

Core income (loss) (47) 20 (124) 10

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Core results for Other Insurance Operations decreased $67 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to a $54 million pretax decline in net investment income from limited partnerships.

Results for the three months ended September 30, 2022 and 2021 included no unlocking event for future policy benefit reserves as a result of the gross premium valuation (“GPV”).

Core loss for the three months ended September 30, 2022 included a $25 million pretax favorable impact from the reduction in long term care claim reserves resulting from the annual claim reserve review in the third quarter of 2022.

The favorable impact was driven by a $107 million release of all remaining incurred but not reported (“IBNR”) reserves established during 2020 and 2021 in response to the COVID-19 pandemic partially offset by an $82 million unfavorable impact from higher claim severity, including utilization and cost of care inflation, than anticipated in the reserve estimates.

The annual structured settlement claim reserve review resulted in a $5 million pretax favorable impact from the reduction in reserves due to discount rate assumption changes.

Core income for the three months ended September 30, 2021 included a $40 million pretax favorable impact from the reduction in long term care claim reserves resulting from the annual claim reserve reviews in the third quarter of 2021.

Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Core results for Other Insurance Operations decreased $134 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, the drivers of which were generally consistent with the three month discussion above.

In addition, core results for the nine months ended September 30, 2022 included higher net prior year loss reserve development associated with legacy mass tort abuse claims and an increase in expenses as a result of continued investments in technology infrastructure and security as compared with the comparable 2021 period.

These results were partially offset by the prior period recognition of a $12 million loss resulting from the legacy excess workers’ compensation loss portfolio transfer (“EWC LPT”).

Net prior year loss reserve development is further discussed in Note 4 of the Notes to Consolidated Condensed Financial Statements included under Item 1.

Table of c o ntents

Life & Group Policyholder Reserves

Annually, in the third quarter, CNA assesses the adequacy of its long term care future policy benefit reserves by performing a GPV to determine if there is a premium deficiency.

See the Insurance Reserves section of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021 for further information on the reserving process.

The September 30, 2022 GPV indicated that the recorded reserves included a margin of approximately $125 million.

A summary of the changes in the estimated reserve margin is presented in the table below:

(In millions)

Long term care active life reserve - change in estimated reserve margin

September 30, 2021 estimated margin $ 72

Changes in underlying economic assumptions (a)

Changes in underlying morbidity assumptions (30)

Changes in underlying persistency assumptions 40

Changes in underlying premium rate action assumptions 190

Changes in underlying expense and other assumptions (17)

September 30, 2022 Estimated Margin $ 125

(a) Economic assumptions include the impact of interest rates and cost of care inflation.

The increase in the margin in 2022 was primarily driven by changes in discount rate assumptions due to higher near term expected reinvestment rates and higher than previously estimated rate increases on active rate increase programs.

These favorable drivers were partially offset by changes in cost of care inflation assumptions.

CNA has determined that additional future policy benefit reserves for profits followed by losses are not currently required based on the most recent projection.

The table below summarizes the estimated pretax impact on CNA’s results of operations from various hypothetical revisions to its future policy benefit reserve assumptions.

The annual GPV process involves updating all assumptions to management’s then current best estimate, and historically all significant assumptions have been revised each year.

In the table below, CNA has assumed that revisions to such assumptions would occur in each policy type, age and duration within each policy group.

The impact of each sensitivity is discrete and does not reflect the impact one factor may have on another or the mitigating impact from CNA’s actions, which may include additional future premium rate increases.

Although such hypothetical revisions are not currently required or anticipated, CNA believes they could occur based on past variances in experience and its expectations of the ranges of future experience that could reasonably occur.

Any required increase in the recorded reserves resulting from a hypothetical revision in the table below would first reduce the margin in the carried reserves before it would affect results from operations.

Any actual adjustment would be dependent on the specific policies affected and, therefore, may differ from the estimates summarized below.

The estimated impacts to results of operations in the table below are after consideration of the existing margin.

September 30, 2022

Estimated Reduction to Pretax Income

(In millions)

Hypothetical revisions

2.5% increase in morbidity $ 200

5% increase in morbidity 500

5% decrease in active life mortality and lapse $ 100

10% decrease in active life mortality and lapse 300

Discount rates:

25 basis point decline in new money interest rates $ —

50 basis point decline in new money interest rates 100

(a) Represents a sensitivity in future paid claims.

Non-GAAP Reconciliation of Core Income to Net Income

The following table reconciles core income to net income attributable to Loews Corporation for t he three and six months ended June 30, 2022 and 2021:

Three Months Ended Six Months Ended

June 30, June 30,

The following table reconciles core income to net income attributable to Loews Corporation for t he three and nine months ended September 30, 2022 and 2021:

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

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For further information on Boardwalk Pipelines’ revenue recognition policies see Note 1 of the Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2021.

The following table summarizes the results of operations for Boardwalk Pipelines for the three and six months ended June 30, 2022 and 2021, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Boardwalk Pipelines’ operations and maintenance expenses are impacted by its compliance with the requirements of, among other regulations, the Pipeline and Hazardous Materials Safety Administration Mega Rule (“Mega Rule”), as further discussed in Results of Operations of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2021.

The following table summarizes the results of operations for Boardwalk Pipelines for the three and nine months ended September 30, 2022 and 2021, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Boardwalk Pipelines also utilizes earnings before interest, income tax expense, depreciation and amortization (“EBITDA”), a non-GAAP measure, as a financial measure to assess its operating and financial performance and return on invested capital.

Management believes some investors may find this measure useful in evaluating Boardwalk Pipelines’ performance.

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Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

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EBITDA $ 192 $ 184 $ 644 $ 627

Three Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $8 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

EBITDA decreased $3 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Total revenues increased $13 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Including the items in fuel and transportation expense, operating revenues increased $9 million, primarily driven by an increase in storage and parking and lending revenues of $5 million due to favorable market conditions and an increase in transportation revenues of $4 million due to recently completed growth projects.

Operating costs and expenses increased $16 million for the three months ended June 30, 2022 as compared with the comparable 2021 period.

Excluding items offset with operating revenues, operating costs and expenses increased $12 million, primarily due to increased costs from maintenance projects associated with the requirements of the Pipeline and Hazardous Materials Safety Administration Mega Rule (“PHMSA Mega Rule”).

Depreciation and amortization expenses increased $6 million for the three months ended June 30, 2022 as compared with the comparable 2021 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expenses increased $2 million for the three months ended June 30, 2022 as compared with the comparable 2021 period, primarily due to higher average outstanding long-term debt.

Six Months Ended June 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $2 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

EBITDA increased $9 million for the six months ended June 30, 2022 as compared with the comparable 2021 period.

Total revenues increased $22 million for the six months ended June 30, 2022 as compared with the comparable 2021 period, primarily driven by an increase in transportation revenues of $16 million due to recently completed growth projects and an increase in storage and parking and lending revenues of $6 million due to favorable market conditions.

Operating costs and expenses increased $13 million for the six months ended June 30, 2022 as compared with the comparable 2021 period primarily due to increased costs from maintenance projects associated with the requirements of the PHMSA Mega Rule.

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Depreciation and amortization expenses increased $9 million for the six months ended June 30, 2022 as compared with the comparable 2021 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expense increased $3 million for the six months ended June 30, 2022 as compared with the comparable 2021 period primarily due to higher average outstanding long-term debt.

Three Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $4 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

EBITDA increased $8 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

T he decrease in net income as compared with the increase in EBITDA is primarily due to the increase in depreciation and amortization expense and interest expense as discussed below.

Total revenues increased $32 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

Including the items in fuel and transportation expense, operating revenues increased $28 million, primarily driven by an increase in transportation revenues of $25 million due to recently completed growth projects, higher utilization-based revenues and re-contracting at higher rates.

In addition, storage and parking and lending revenues increased $5 million due to favorable market conditions.

Operating costs and expenses increased $24 million for the three months ended September 30, 2022 as compared with the comparable 2021 period.

Excluding items offset with operating revenues, operating costs and expenses increased $20 million, primarily due to increased costs from maintenance projects associated with compliance with the requirements of the Mega Rule and asset impairment charges resulting from an increase in the estimate of existing asset retirement obligations related to retired assets.

Depreciation and amortization expenses increased $11 million for the three months ended September 30, 2022 as compared with the comparable 2021 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expenses increased $2 million for the three months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to higher average outstanding long-term debt.

Nine Months Ended September 30, 2022 Compared to the Comparable 2021 Period

Net income attributable to Loews Corporation decreased $6 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

EBITDA increased $17 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

The decrease in net income as compared with the increase in EBITDA is primarily due to the increase in depreciation and amortization expense and interest expense as discussed below.

Total revenues increased $54 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

Including the items in fuel and transportation expense, operating revenues increased $50 million, primarily driven by an increase in transportation revenues of $41 million due to recently completed growth projects, re-contracting at higher rates and higher utilization-based revenues.

In addition, storage and parking and lending revenues increased $11 million due to favorable market conditions.

Operating costs and expenses increased $37 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period.

Excluding items offset with operating revenues, operating costs and expenses increased $33 million, primarily due to increased costs from maintenance projects associated with compliance with the requirements of the Mega Rule and asset impairment charges resulting from an increase in the estimate of existing asset retirement obligations related to retired assets.

Depreciation and amortization expenses increased $20 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expense increased $5 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period primarily due to higher average outstanding long-term debt.

Non-GAAP Reconciliation of Net Income attributable to Loews Corporation to EBITDA

The following table for Boardwalk Pipelines presents a reconciliation of net income attributable to Loews Corporation to EBITDA for the three and six months ended June 30, 2022 and 2021:

The following table for Boardwalk Pipelines presents a reconciliation of net income attributable to Loews Corporation to EBITDA for the three and nine months ended September 30, 2022 and 2021:

Three Months Ended

Six Months Ended

Nine Months Ended

September 30,

(In millions)

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42 40 126 121

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$ 192 $ 184 $ 644 $ 627

Loews Hotels & Co

The following table summarizes the results of operations for Loews Hotels & Co for the three and six months ended June 30, 2022 and 2021, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended Six Months Ended

June 30, June 30,

The following table summarizes the results of operations for Loews Hotels & Co for the three and nine months ended September 30, 2022 and 2021, as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

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Depreciation and amortization expense 16 15 47 47

Equity (income) loss from joint ventures (53) (3) (79) 9

Equity income from joint ventures (36) (26) (115) (17)

Interest (1) 8 7 25

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Net income (loss) attributable to Loews Corporation $ 25 $ 13 $ 84 $ (51)

Net income (loss) attributable to Loews Corporation improved by $65 million and $123 million for the three and six months ended June 30, 2022 as compared to the comparable prior year periods.

Loews Hotels & Co’s results significantly improved for the three and six months ended June 30, 2022 as compared with the comparable 2021 periods as overall travel demand and resulting business levels were considerably higher in 2022.

Travel, particularly to resort destinations, has significantly rebounded from the impacts of the COVID-19 pandemic causing overall occupancy rates to improve.

Operating revenues improved by $92 million and $176 million and operating expenses increased by $43 million and $93 million for the three and six months ended June 30, 2022 as compared with the comparable 2021 periods.

Net income (loss) attributable to Loews Corporation improved by $12 million and $135 million for the three and nine months ended September 30, 2022 as compared to the comparable prior year periods.

Loews Hotels & Co’s results significantly improved for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods as overall travel demand and resulting business levels were considerably higher in 2022.

Travel has significantly rebounded from the impacts of the COVID-19 pandemic, causing overall occupancy rates to improve.

Operating revenues improved by $42 million and $218 million and operating expenses increased by $35 million and $128 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods.

The increase in operating revenues was driven by stronger occupancy levels and higher average daily rates at many hotels in 2022 as compared to 2021.

Operating expenses have likewise increased to support the higher demand levels and resumption of additional pre-pandemic services.

Equity (income) loss from joint ventures improved $50 million and $88 million for the three and six months ended June 30, 2022 as compared with the comparable 2021 periods.

This improvement was the result of having all 9,000 rooms available at the Universal Orlando Resort in the first half of 2022 along with greater occupancy levels and higher average daily rates, particularly at the Universal Orlando Resort.

During the second quarter of 2022, Loews Hotels & Co recorded an impairment charge of $14 million to reduce the carrying value of an asset to its estimated fair value.

Interest expense decreased $5 million and $9 million for the three and six months ended June 30, 2022 as compared with the comparable 2021 periods due primarily to the increase in fair value of an interest rate cap that was executed in the first quarter of 2022, higher capitalized interest on a project under development, and lower average debt balances.

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Equity income from joint ventures improved $10 million and $98 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods.

The increase in equity income from joint ventures was driven by stronger occupancy levels and higher average daily rates at many joint venture hotels, particularly at the Universal Orlando Resort, during 2022 as compared to 2021.

Operating expenses have likewise increased to support the higher demand levels and resumption of additional pre-pandemic services at those joint venture hotels.

Additionally, improvement in the 2022 nine months period also resulted from having all 9,000 rooms available at the Universal Orlando Resort for the entire 2022 period whereas certain properties were not available for periods of 2021.

The three and nine months ended September 30, 2022 include impairment charges of $8 million and $22 million to reduce the carrying value of an asset to its estimated fair value.

Interest expense decreased $9 million and $18 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods due primarily to the increase in fair value of an interest rate cap of $7 million and $11 million that was executed in the first quarter of 2022, higher capitalized interest on a project under development, and lower average debt balances.

Corporate operations consist primarily of investment income, interest expense and administrative costs at the Parent Company.

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Corporate also includes the consolidated operations of Altium Packaging through March 31, 2021 and the equity method of accounting for Altium Packaging subsequent to its deconsolidation on April 1, 2021.

The following table summarizes the results of operations for Corporate for the three and six months ended June 30, 2022 and 2021 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report:

Three Months Ended Six Months Ended

June 30, June 30,

The following table summarizes the results of operations for Corporate for the three and nine months ended September 30, 2022 and 2021 as presented in Note 11 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report:

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

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Net income (loss) attributable to Loews Corporation $ (44) $ (60) $ (179) $ 278

Net investment losses for the Parent Company were $65 million and $81 million for the three and six months ended June 30, 2022 as compared with income of $24 million and $70 million for the comparable 2021 periods, primarily due to the decline in fair value of equity based investments.

Investment gains of $540 million for the three and six months ended June 30, 2021 were primarily due to a gain of $555 million ($438 million after tax) on the sale of 47% of Altium Packaging and deconsolidation on April 1, 2021.

Operating revenues and other for the six months ended June 30, 2021 include $280 million of consolidated operating revenues for Altium Packaging through March 31, 2021.

Operating and other expenses decreased $7 million for the three months ended June 30, 2022 as compared with the comparable 2021 period, primarily due to lower corporate overhead expenses at the Parent Company.

Operating and other expenses decreased $293 million for the six months ended June 30, 2022 as compared with the comparable 2021 period, primarily due to $279 million of operating expenses for Altium Packaging through March 31, 2021 prior to its deconsolidation and use of the equity method for Altium Packaging since its deconsolidation.

In addition, there were lower corporate overhead and legal expenses at the Parent Company for the six months ended June 30, 2022 as compared with the comparable 2021 period .

Interest expenses decreased $26 million for the six months ended June 30, 2022 as compared with the comparable 2021 period due to consolidated interest expenses for Altium Packaging through March 31, 2021, which included a charge of approximately $14 million to write off debt issuance costs for the early retirement of debt.

Income tax expense of $114 million and $145 million for the three and six months ended June 30, 2021 includes the recognition of $117 million of taxes on the investment gain related to the sale of 47% of Altium Packaging.

The income tax

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expense for the six months ended June 30, 2021 also included the recognition of a $40 million deferred tax liability related to the sale of Altium Packaging.

Net investment loss for the Parent Company decreased $11 million for the three months ended September 30, 2022 as compared with the comparable 2021 period primarily due to improved results from short term investments in the Parent Company trading portfolio.

Net investment loss was $100 million for the nine months ended September 30, 2022 as compared with net investment income of $40 million in the comparable 2021 period primarily due to the decline in fair value of equity based investments.

Investment gains of $540 million for the nine months ended September 30, 2021 were primarily due to a gain of $555 million ($438 million after tax) on the sale of 47% of Altium Packaging and its deconsolidation on April 1, 2021.

Operating revenues and other for the nine months ended September 30, 2021 include $280 million of consolidated operating revenues for Altium Packaging through March 31, 2021.

Operating and other expenses decreased $10 million for the three months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to lower corporate expenses at the Parent Company.

Operating and other expenses decreased $303 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to $279 million of operating expenses for Altium Packaging through March 31, 2021 prior to its deconsolidation and use of the equity method for Altium Packaging since its deconsolidation.

In addition, there were lower corporate expenses at the Parent Company for the nine months ended September 30, 2022 as compared with the comparable 2021 period .

Interest expenses decreased $26 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period due to consolidated interest expenses for Altium Packaging through March 31, 2021, which included a charge of approximately $14 million to write off debt issuance costs for the early retirement of debt.

Income tax expense of $126 million for the nine months ended September 30, 2021 includes the recognition of $117 million of taxes on the investment gain and the recognition of a $40 million deferred tax liability, both of which are related to the sale of 47% of Altium Packaging.

LIQUIDITY AND CAPITAL RESOURCES

Parent Company

Parent Company cash and investments, net of receivables and payables, totaled $3.5 billion at June 30, 2022 as compared to $3.4 billion at December 31, 2021.

During the six months ended June 30, 2022 , we received $681 million in cash dividends from CNA, including a special cash dividend of $486 million.

Cash outflows during the six months ended June 30, 2022 included the payment of $380 million to fund treasury stock purchases, $31 million of cash dividends to our shareholders and $33 million of cash contributions to Loews Hotels & Co.

Parent Company cash and investments, net of receivables and payables, totaled $3.2 billion at September 30, 2022 as compared to $3.4 billion at December 31, 2021.

During the nine months ended September 30, 2022 , we received $778 million in cash dividends from CNA, including a special cash dividend of $486 million.

Cash outflows during the nine months ended September 30, 2022 included the payment of $611 million to fund treasury stock purchases, $46 million of cash dividends to our shareholders, $26 million to purchase common shares of CNA and equity contributions of $33 million to Loews Hotels & Co and $79 million to Altium Packaging.

As a holding company we depend on dividends from our subsidiaries and returns on our investment portfolio to fund our obligations.

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Depending on market and other conditions, we may purchase our shares and shares of our subsidiaries outstanding common stock in the open market, in privately negotiated transactions or otherwise.

During the six months ended June 30, 2022 , we purchased 6.3 million shares of Loews Corporation common stock.

As of July 29, 2022, we had purchased an additional 1.3 million shares of Loews Corporation common stock in 2022 at an additional aggregate cost of $75 million.

As of July 29, 2022, there were 240,947,343 shares of Loews Corporation common stock outstanding.

During the nine months ended September 30, 2022 , we purchased 10.5 million shares of Loews Corporation common stock and 0.7 million shares of CNA’s common stock.

As of October 28, 2022, we had purchased an additional 0.7 million shares of Loews Corporation common stock in 2022 at an additional aggregate cost of $38 million.

As of October 28, 2022, there were 237,427,052 shares of Loews Corporation common stock outstanding.

Future uses of our cash may include investing in our subsidiaries, new acquisitions, dividends and/or repurchases of our and our subsidiaries’ outstanding common stock.

The declaration and payment of future dividends to holders of our common stock will be at the discretion of our Board of Directors and will depend on many factors, including our earnings, financial condition and business needs.

CNA’s cash provided by operating activities was $1.3 billion for the six months ended June 30, 2022 and $685 million for the comparable 2021 period.

CNA’s cash provided by operating activities was $2.0 billion for the nine months ended September 30, 2022 and $1.4 billion for the comparable 2021 period.

The increase in cash provided by operating activities was driven by the prior year payment of the EWC LPT premium.

CNA paid cash dividends of $2.80 per share on its common stock, including a special cash dividend of $2.00 per share, during the six months ended June 30, 2022.

On July 29, 2022, CNA’s Board of Directors declared a quarterly cash dividend of $0.40 per share payable September 1, 2022 to shareholders of record on August 15, 2022 .

CNA paid cash dividends of $3.20 per share on its common stock, including a special cash dividend of $2.00 per share, during the nine months ended September 30, 2022.

On October 28, 2022, CNA’s Board of Directors declared a quarterly cash dividend of $0.40 per share payable December 1, 2022 to shareholders of record on November 15, 2022 .

CNA’s declaration and payment of future dividends is at the discretion of its Board of Directors and will depend on many factors, including CNA’s earnings, financial condition, business needs and regulatory constraints.

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Additionally, ordinary dividends may only be paid from earned surplus, which is calculated by removing unrealized gains from unassigned surplus.

As of June 30, 2022, CCC was in a positive earned surplus position.

CCC paid dividends of $690 million and $480 million during the six months ended June 30, 2022 and 2021.

As of September 30, 2022, CCC was in a positive earned surplus position.

CCC paid dividends of $845 million and $600 million during the nine months ended September 30, 2022 and 2021.

The actual level of dividends paid in any year is determined after an assessment of available dividend capacity, holding company liquidity and cash needs as well as the impact the dividends will have on the statutory surplus of the applicable insurance company.

CNA has an effective shelf registration statement on file with the SEC under which it may publicly issue an unspecified amount of debt, equity or hybrid securities from time to time.

Boardwalk Pipelines’ cash provided by operating activities increased $35 million for the six months ended June 30, 2022 compared to the comparable 2021 period, primarily due to the timing of receivables and prepaids.

For the six months ended June 30, 2022 and 2021, Boardwalk Pipelines’ capital expenditures were $122 million and $138 million, consisting of growth capital expenditures of $76 million and $86 million and maintenance capital

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expenditures of $39 million and $52 million.

During the six months ended June 30, 2022, Boardwalk Pipelines also spent $7 million on natural gas to be used in its integrated natural gas pipeline system.

Boardwalk Pipelines anticipates that its existing capital resources, including its cash on hand, revolving credit facility and cash flows from operating activities, will be adequate to fund its operations and capital expenditures for 2022 and to retire the outstanding $300 million aggregate principal amount of its 3.4% senior notes due in February of 2023.

Boardwalk Pipelines’ cash provided by operating activities increased $55 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, primarily due to the timing of gas transportation receivables and the impacts of higher natural gas prices on fuel tracker activities.

For the nine months ended September 30, 2022 and 2021, Boardwalk Pipelines’ capital expenditures were $208 million and $239 million, consisting of growth capital expenditures of $122 million and $130 million and maintenance capital expenditures of $79 million and $89 million.

During the nine months ended September 30, 2022, Boardwalk Pipelines also spent $7 million on natural gas to be used in its integrated natural gas pipeline system.

During the nine months ended September 30, 2021, Boardwalk Pipelines acquired certain natural gas pipeline assets for approximately $20 million.

Boardwalk Pipelines also has an effective shelf registration statement on file with the SEC under which it may publicly issue $1.0 billion of debt securities, warrants or rights from time to time.

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Boardwalk Pipelines used the proceeds to retire the outstanding $300 million aggregate principal amount of its 4.0% senior notes due June 2022 in March of 2022, to fund growth capital expenditures and for general corporate purposes.

In September of 2022, Boardwalk Pipelines notified the holders of the 2023 Notes that it intends to retire the 2023 Notes on November 1, 2022, at a redemption price of 100% of the principal amount plus any unpaid and accrued interest.

Boardwalk Pipelines will fund the retirement of the 2023 Notes from available cash.

In June of 2022, Boardwalk Pipelines’ revolving credit facility was amended to, among other things, extend the maturity date by one year to May 27, 2027, while preserving the two one-year extensions that can be exercised at Boardwalk Pipelines’ election and complete a full transition to interest rates based on the term Secured Overnight Financing Rate (“SOFR”).

As of June 30, 2022, Boardwalk Pipelines had no outstanding borrowings and all of the $1.0 billion available borrowing capacity under its revolving credit facility.

As of June 30, 2022, Loews Hotels & Co, through its subsidiaries, has loans that mature within twelve months and is actively working with lenders to refinance $13 million in current maturities of long term debt.

Extending these loans, along with certain loans of unconsolidated joint venture partnerships, may require Loews Hotels & Co to make principal pay downs, establish restricted cash reserves or provide guaranties of a subsidiary’s debt.

As of September 30, 2022, Boardwalk Pipelines had no outstanding borrowings and all of the $1.0 billion available borrowing capacity under its revolving credit facility.

As of September 30, 2022, Loews Hotels & Co has a $13 million loan that matures within twelve months, which it currently intends to pay off in the fourth quarter of 2022.

Loews Hotels & Co, through its subsidiaries, has loans maturing beyond twelve months which it will work to refinance prior to maturity.

Extending any indebtedness, including loans of unconsolidated joint venture partnerships, may require Loews Hotels & Co to make principal pay downs, establish restricted cash reserves or provide guaranties of the subsidiary’s debt.

Through the date of this Report, none of Loews Hotels & Co’s subsidiaries are in default on any of their loans.

Through July 29, 2022, Loews Hotels & Co received capital contributions of $33 million from Loews Corporation to fund development projects.

In October of 2022, Loews Hotels & Co contributed $34 million as an initial investment in two joint venture development projects expected to open in 2025.

These projects are currently estimated to require an aggregate investment of approximately $200 million in capital contributions from Loews Hotels & Co.

Based on the timing of capital calls relative to the seasonality of Loews Hotels & Co’s business, capital contributions from Loews Corporation to Loews Hotels & Co may be required.

Through October 28, 2022, Loews Hotels & Co received capital contributions of $33 million from Loews Corporation to fund development projects during 2022.

In August of 2022, we made a cash contribution of $79 million to our equity method investee, Altium Packaging.

These funds and a pro rata contribution from our joint venture partner were used by Altium Packaging for acquisitions which expand its offerings and increase its bottle manufacturing capabilities throughout key industries and geographies.

Investment activities of our non-insurance subsidiaries primarily consist of investments in fixed income securities, including short term investments.

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Certain of these types of Parent Company investments generally have greater volatility, less liquidity and greater risk than fixed income investments and are included within Results of Operations – Corporate.

The Parent Company enters into short sales and invests in certain derivative instruments that are used for asset and liability management activities, income enhancements to its portfolio management strategy and to benefit from anticipated future movements in the underlying markets.

future movements in the underlying markets.

If such movements do not occur as anticipated, then significant losses may occur.

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CNA’s investment portfolio supports its obligation to pay future insurance claims and provides investment returns which are an important part of CNA’s overall profitability.

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Net Investment Income

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Fixed income securities, as presented, include both fixed maturity securities and non-redeemable preferred stock.

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

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Limited partnership and common stock return (2.1)% 3.8 % (2.4)% 16.4 %

CNA’s net investment income decreased $159 million and $215 million for the three and six months ended June 30, 2022 as compared with the comparable 2021 periods, driven by unfavorable limited partnership and common stock results, partially offset by higher income from fixed income securities.

CNA’s net investment income decreased $91 million and $306 million for the three and nine months ended September 30, 2022 as compared with the comparable 2021 periods, driven by unfavorable limited partnership and common stock results, partially offset by higher income from fixed income securities.

Investment Gains (Losses)

The components of CNA’s investment gains (losses) are presented in the following table:

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

2022 2021 2022

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Non-redeemable preferred stock (2) (2) (111) 17

Short term and other 27 (10) 56 7

Derivatives, short term and other (42) 2 14 9

Total investment gains (losses) (96) 22 (166) 117

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Investment gains (losses) attributable to Loews Corporation $ (76) $ 16 $ (115) $ 84

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CNA’s investment results decreased $97 million and $165 million for the three and six months ended June 30, 2022 as compared with the comparable 2021 periods, driven by the unfavorable change in fair value of non-redeemable preferred stock.

(a) Excludes the loss in the third quarter of 2022 on the assets supporting the funds withheld liability, which is reflected in the Derivatives, short term and other line.

CNA’s pretax investment results decreased $118 million for the three months ended September 30, 2022 as compared with the comparable 2021 period, driven by the net losses on fixed maturity securities in the three months ended September 30, 2022 as compared to net gains in the comparable 2021 period.

Additionally, Derivatives, short term and other for the three months ended September 30, 2022 includes a $35 million non-economic net loss related to the expected novation of a coinsurance agreement on CNA’s legacy annuity business in its Other Insurance Operations and the associated funds withheld embedded derivative.

CNA’s pretax investment results decreased $283 million for the nine months ended September 30, 2022 as compared with the comparable 2021 period, driven by the unfavorable change in fair value of non-redeemable preferred stock and net losses on fixed maturity securities in the nine months ended September 30, 2022 as compared to net gains in the comparable 2021 period.

Further information on CNA’s investment gains and losses is set forth in Note 2 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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The following table presents the estimated fair value and net unrealized gains (losses) of CNA’s fixed maturity securities by rating distribution:

June 30, 2022

September 30, 2022

December 31, 2021

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Total $ 37,251 $ (4,076) $ 44,380 $ 4,446

As of June 30, 2022 and December 31, 2021, 1% of CNA’s fixed maturity portfolio was rated internally.

AAA rated securities included $0.6 billion and $1.7 billion of pre-refunded municipal bonds as of June 30, 2022 and December 31, 2021.

As of September 30, 2022 and December 31, 2021, 1% of CNA’s fixed maturity portfolio was rated internally.

AAA rated securities included $0.4 billion and $1.7 billion of pre-refunded municipal bonds as of September 30, 2022 and December 31, 2021.

The following table presents CNA’s available-for-sale fixed maturity securities in a gross unrealized loss position by ratings distribution:

June 30, 2022

September 30, 2022

Estimated Fair Value

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Total $ 29,944 $ 4,583

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The following table presents the maturity profile for these available-for-sale fixed maturity securities.

Securities not due to mature on a single date are allocated based on weighted average life:

June 30, 2022

September 30, 2022

Estimated Fair Value

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Amounts presented are net of payable and receivable amounts for securities purchased and sold, but not yet settled.

June 30, 2022

September 30, 2022

December 31, 2021

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Total $ 38,992 6.7 $ 47,373 6.6

The effective duration of investments supporting Other Insurance Operations liabilities at June 30, 2022 lengthened as compared with December 31, 2021, reflecting strategic repositioning to capitalize on higher rates and reduce reinvestment risk.

The effective duration of investments supporting Other Insurance Operations liabilities at September 30, 2022 lengthened as compared with December 31, 2021, reflecting strategic repositioning to capitalize on higher rates and reduce reinvestment risk.

CNA’s investment portfolio is periodically analyzed for changes in duration and related price risk.

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A summary of these risks and specific analysis on changes is included in the Quantitative and Qualitative Disclosures about Market Risk included under Item 7A of our Annual Report on Form 10-K for the year ended December 31, 2021.

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CRITICAL ACCOUNTING ESTIMATES

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This will be partially offset by the de-recognition of Shadow Adjustments associated with long-duration contracts.

The net impact of these changes is expected to be a $2.0 billion - $2.3 billion (after tax and noncontrolling interests) decrease in Accumulated other comprehensive income as of the transition date of January 1, 2021.

To illustrate the sensitivity of this adjustment, had the interest rates in effect as of June 30, 2022 been used in the calculation, the transition impact would have been a $0.3 billion - $0.6 billion (after tax and noncontrolling interests) decrease in Accumulated other comprehensive income.

The net impact of these changes is expected to be a decrease of approximately $2.1 billion (after tax and noncontrolling interests) in Accumulated other comprehensive income as of the transition date of January 1, 2021.

To illustrate the sensitivity of this adjustment, had the interest rates in effect as of September 30, 2022 been used in the calculation, the transition impact to AOCI would have been approximately zero.

The requirement to review, and update if there is a change, cash flow assumptions at least annually is expected to change the pattern of earnings being recognized.

Under current accounting guidance, the third quarter 2022 gross premium valuation assessment indicated a pretax reserve margin of $125 million, with no unlocking event.

However under the new guidance, the effect of changes in cash flow assumptions from the assessment would be recorded in results of operations (except for discount rate changes which would be recorded quarterly through AOCI).

For a discussion of accounting standards updates that have been adopted or will be adopted in the future, please read Note 1 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis