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Item 2. Management’s Discussion and Analysis

2024-05-06 compared with 2023-10-30 · 140 added, 439 removed, 290 unchanged (67% of the section changed)

15 unchanged sentences

The Corporate segment is primarily comprised of Loews Corporation, excluding its operating subsidiaries, and the equity method of accounting for Altium Packaging LLC (“Altium Packaging”).

Unless the context otherwise requires, as used herein, the term “Company” means Loews Corporation including its subsidiaries, the terms “Parent Company,” “we,” “our,” “us” or like terms mean Loews Corporation excluding its subsidiaries and the term “Net income (loss) attributable to Loews Corporation” means Net income (loss) attributable to Loews Corporation shareholders.

Unless the context otherwise requires, as used herein, the term “Company” means Loews Corporation including its consolidated subsidiaries, the terms “Parent Company,” “we,” “our,” “us” or like terms mean Loews Corporation excluding its subsidiaries, the term “Net income (loss) attributable to Loews Corporation” means Net income (loss) attributable to Loews Corporation shareholders and the term “subsidiaries” means Loews Corporation’s consolidated subsidiaries.

We rely upon our invested cash balances and distributions from our subsidiaries to generate the funds necessary to meet our obligations and to declare and pay any dividends to our shareholders.

4 unchanged sentences

Consolidated Financial Results

The following table summarizes net income (loss) attributable to Loews Corporation by segment and the basic and diluted net income per share attributable to Loews Corporation for the three and nine months ended September 30, 2023 and 2022:

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

Three Months Ended March 31 2024 2023

(In millions, except per share data)

CNA Financial (a) $ 235 $ (37) $ 758 $ 398

CNA Financial $ 310 $ 268

Boardwalk Pipelines 121 86

1 unchanged sentence

Corporate 10 (3)

Net income (loss) attributable to Loews Corporation $ 253 $ (22) $ 988 $ 467

Basic net income (loss) per share $ 1.12 $ (0.09) $ 4.32 $ 1.91

Diluted net income (loss) per share (a) $ 1.12 $ (0.09) $ 4.31 $ 1.90

(a) As of January 1, 2023, Accounting Standards Update (“ASU”) 2018-12, “ Financial Services – Insurance (Topic 944):

Targeted Improvements to the Accounting for Long-Duration Contracts,” (“ASU 2018-12”) was adopted using the modified retrospective method applied as of the transition date of January 1, 2021.

Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance.

For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Net income attributable to Loews Corporation for the three months ended September 30, 2023 was $253 million, or $1.12 per share, compared to net loss of $22 million, or $0.09 per share in the comparable 2022 period.

Net income attributable to Loews Corporation for the nine months ended September 30, 2023 was $988 million, or $4.31 per share, compared to $467 million, or $1.90 per share in the comparable 2022 period.

Corporate includes a $37 million after-tax charge for the termination of a non-contributory defined benefit pension plan for the three and nine months ended September 30, 2023 .

Loews Hotels & Co includes a $36 million after-tax gain related to the acquisition of an additional equity interest in, and the consolidation of, a previously unconsolidated joint venture property for the nine months ended September 30, 2023.

The increase in net income attributable to Loews Corporation in the third quarter of 2023 as compared to the comparable 2022 period was driven by improved results at CNA due to higher net investment income, lower investment losses, higher underlying underwriting income, and a significantly lower unfavorable impact from long-term care annual reserve reviews performed in the third quarter of each year.

Additionally the parent company posted higher investment returns on equity securities and short-term investments.

Results drivers for the nine months ended September 30, 2023 as compared to the comparable 2022 period are consistent with the three-month period discussed above.

Net income attributable to Loews Corporation $ 457 $ 375

Basic and diluted net income per share $ 2.05 $ 1.61

Net income attributable to Loews Corporation for the three months ended March 31, 2024 was $457 million, or $2.05 per share, compared to net income of $375 million, or $1.61 per share in the comparable 2023 period.

The increase in net income attributable to Loews Corporation for the three months ended March 31, 2024 as compared to the comparable 2023 period was primarily driven by higher net income at CNA and Boardwalk Pipelines.

The increase at CNA is primarily due to higher net investment income and favorable net prior year loss reserve development, partially offset by higher catastrophe losses and the increase at Boardwalk Pipelines is primarily due to higher revenues from re-contracting at higher rates and recently completed growth projects.

CNA Financial

The following table summarizes the results of operations for CNA for the three and nine months ended September 30, 2023 and 2022 as presented in Note 13 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 months ended March 31, 2024 and 2023 as presented in Note 12 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 Nine Months Ended

September 30, September 30,

2023 2022 (a) 2023 2022 (a)

Three Months Ended March 31 2024 2023

(In millions)

11 unchanged sentences

Total 3,017 2,781

Income (loss) before income tax 326 (51) 1,058 531

Income tax (expense) benefit (68) 9 (220) (88)

Net income (loss) 258 (42) 838 443

Income before income tax 427 371

Income tax expense (89) (74)

Net income 338 297

Amounts attributable to noncontrolling interests (28) (29)

Net income (loss) attributable to Loews Corporation $ 235 $ (37) $ 758 $ 398

(a) As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021.

Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance.

For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation increased $272 million for the three months ended September 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income from limited partnership and common stock returns and fixed income securities, lower investment losses driven by a decrease in net losses on fixed maturity securities, improved underlying underwriting income and lower catastrophe losses.

Catastrophe losses were $94 million ($67 million after tax and noncontrolling interests) for the three months ended September 30, 2023 as compared with $114 million ($80 million after tax and noncontrolling interests) in the comparable 2022 period.

Net income for the three months ended September 30, 2022 also included a $186 million ($131 million after tax and noncontrolling interests) increase to long term care reserves primarily driven by the unfavorable impact of increased cost of care inflation offset by favorable premium rate assumptions.

These increases to net income were partially offset by unfavorable net prior year loss reserve development for the three months ended September 30, 2023 as compared with favorable net prior year loss reserve development for the comparable 2022 period.

Nine Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation increased $360 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income from limited partnership and common stock returns and fixed income securities and lower investment losses driven by the favorable relative change in fair value of non-redeemable preferred stock and improved underlying underwriting income.

Net income for the nine months ended September 30, 2022 also included a $186 million ($131 million after tax and noncontrolling interests) increase to long term care reserves primarily driven by the unfavorable impact of increased cost of care inflation offset by favorable premium rate assumptions.

These increases to net income were partially offset by higher catastrophe losses and unfavorable net prior year loss reserve development for the nine months ended September 30, 2023 as compared with favorable net prior year loss reserve development for the comparable 2022 period.

Catastrophe losses were $214 million ($152 million after tax and noncontrolling interests) for the nine months ended September 30, 2023 as compared with $171 million ($121 million after tax and noncontrolling interests) in the comparable 2022 period.

Results for the three and nine months ended September 30, 2023 were impacted by unfavorable net pension costs related to CNA’s legacy United States of America (“U.S.”) pension plan, primarily due to higher interest cost on projected benefit obligations as a result of an increase in discount rates year over year, as well as a lower expected return on plan assets as a result of a lower plan asset base given actual asset returns in 2022.

A portion of this additional cost has resulted in an unfavorable impact on the expense ratio for the three and nine months ended September 30, 2023.

Net income attributable to Loews Corporation $ 310 $ 268

Net income attributable to Loews Corporation increased $42 million for the three months ended March 31, 2024 as compared with the comparable 2023 period due to higher net investment income and favorable net prior year loss reserve development, par tially offset by higher catastrophe losses.

CNA’s Property & Casualty and Other Insurance Operations

27 unchanged sentences

New business represents premiums from policies written with new customers and additional policies written with existing customers.

Gross written

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

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

CNA uses underwriting gain (loss), calculated using GAAP financial results, to monitor insurance operations.

1 unchanged sentence

Underlying underwriting gain (loss) represents underwriting results excluding catastrophe losses and development-related items.

The following tables summarize the results of CNA’s Property & Casualty Operations for the three and nine months e nded September 30, 2023 and 2022.

Three Months Ended September 30, 2023 Specialty

The following tables summarize the results of CNA’s Property & Casualty Operations for the three months e nded March 31, 2024 and 2023.

Three Months Ended March 31, 2024 Specialty

International

8 unchanged sentences

Other performance metrics:

Loss ratio excluding catastrophes and development 58.6 % 61.5 % 57.9 % 60.0 %

Effect of catastrophe impacts 7.4 2.3 4.1

Effect of development-related items (0.6) (0.2)

Loss ratio 58.0 % 68.9 % 60.2 % 63.9 %

Expense ratio 31.8 29.5 28.1 30.1

Dividend ratio 0.3 0.5 0.3

Combined ratio 90.1 % 98.9 % 88.3 % 94.3 %

Combined ratio excluding catastrophes and development 90.7 % 91.5 % 86.0 % 90.4 %

Rate 1 % 8 % 2 % 5 %

Renewal premium change 2 9 7 6

Retention 87 83 84 84

New business $ 121 $ 292 $ 62 $ 475

Three Months Ended September 30, 2022

Gross written premiums $ 1,890 $ 1,187 $ 288 $ 3,365

Gross written premiums excluding third-party captives 958 1,184 288 2,430

Net written premiums 840 962 258 2,060

Net earned premiums 810 1,023 270 2,103

Underwriting gain (loss) 92 (23) 15 84

Net investment income 102 112 16 230

Core income 161 80 19 260

Other performance metrics:

Loss ratio excluding catastrophes and development 58.4 % 61.5 % 58.6 % 59.9 %

Underlying loss ratio 59.2 % 62.0 % 58.1 % 60.5 %

Effect of catastrophe impacts 6.8 2.0 3.8

4 unchanged sentences

Combined ratio 90.7 % 97.6 % 93.3 % 94.6 %

Combined ratio excluding catastrophes and development 90.4 % 91.9 % 90.3 % 91.1 %

Underlying combined ratio 91.3 % 90.8 % 91.3 % 91.0 %

Rate 2 % 6 % 1 % 4 %

2 unchanged sentences

New business $ 94 $ 367 $ 68 $ 529

Nine Months Ended September 30, 2023 Specialty

International

Three Months Ended March 31, 2023 Specialty Commercial International Total

(In millions, except %)

7 unchanged sentences

Other performance metrics:

Loss ratio excluding catastrophes and development 58.5 % 61.5 % 57.8 % 59.9 %

Effect of catastrophe impacts 5.7 2.7 3.2

Effect of development-related items (0.3) (0.2) 1.7

Loss ratio 58.2 % 67.0 % 62.2 % 63.1 %

Expense ratio 31.9 29.6 30.3 30.6

Dividend ratio 0.2 0.5 0.3

Combined ratio 90.3 % 97.1 % 92.5 % 94.0 %

Combined ratio excluding catastrophes and development 90.6 % 91.6 % 88.1 % 90.8 %

Rate 1 % 8 % 4 % 5 %

Renewal premium change 2 10 7 7

Retention 88 85 83 85

New business $ 349 $ 945 $ 239 $ 1,533

Nine Months Ended September 30, 2022

Gross written premiums $ 5,640 $ 3,824 $ 1,033 $ 10,497

Gross written premiums excluding third-party captives 2,816 3,711 1,033 7,560

Net written premiums 2,443 3,097 839 6,379

Net earned premiums 2,376 2,901 803 6,080

Underwriting gain 273 94 58 425

Net investment income 305 343 44 692

Core income 485 350 63 898

Other performance metrics:

Loss ratio excluding catastrophes and development 58.6 % 61.5 % 58.6 % 60.0 %

Underlying loss ratio 58.4 % 61.5 % 57.5 % 59.8 %

Effect of catastrophe impacts 4.2 2.8 2.4

4 unchanged sentences

Combined ratio 90.0 % 96.0 % 97.2 % 93.9 %

Combined ratio excluding catastrophes and development 89.8 % 92.1 % 90.7 % 91.1 %

Underlying combined ratio 90.0 % 91.8 % 89.3 % 90.8 %

Rate 2 % 7 % 4 % 5 %

2 unchanged sentences

New business $ 108 $ 310 $ 85 $ 503

Three Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Gross written premiums, excluding third-party captives, for Specialty decreased $9 million for the three months ended September 30, 2023 as compared with the comparable 2022 period driven by lower new business and rate.

Net written premiums for Specialty decreased $15 million for the three months ended September 30, 2023 as compared with the comparable 2022 period.

The increase in net earned premiums for the three months ended September 30, 2023 was consistent with the trend in net written premiums in recent quarters for Specialty.

Gross written premiums for Commercial increased $156 million for the three months ended September 30, 2023 as compared with the comparable 2022 period driven by rate and higher new business.

Net written premiums for Commercial increased $109 million for the three months ended September 30, 2023 as compared with the comparable 2022 period.

The increase in net earned premiums for the three months ended September 30, 2023 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $18 million, or $12 million excluding the effect of foreign currency exchange rates, for the three months ended September 30, 2023 as compared with the comparable 2022 period driven by favorable renewal premium change and retention.

Net written premiums for International increased $24 million, or $17 million excluding the effect of foreign currency exchange rates, for the three months ended September 30, 2023 as compared with the comparable 2022 period.

The increase in n et earned premiums for the three months ended September 30, 2023 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $91 million for the three months ended September 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income, improved underlying underwriting income and lower catastrophe losses partially offset by lower favorable net prior year loss reserve development.

Total catastrophe losses for Property & Casualty Operations were $94 million for the three months ended September 30, 2023 as compared with $114 million for the comparable 2022 period.

For the three months ended September 30, 2023 and 2022, Specialty had no catastrophe losses and catastrophe losses of $1 million, Commercial had catastrophe losses of $87 million and $103 million and International had catastrophe losses of $7 million and $10 million.

Favorable net prior year loss reserve development for Property & Casualty Operations of $7 million and $17 million was recorded for the three months ended September 30, 2023 and 2022.

For the three months ended September 30, 2023 and 2022, Specialty recorded favorable net prior year loss reserve development of $5 million and $15 million, Commercial recorded favorable net prior year loss reserve development of $2 million for each period and International recorded no net prior year loss reserve development.

Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Specialty’s combined ratio increased 1.4 points for the three months ended September 30, 2023 as compared with the comparable 2022 period largely due to a 1.3 point increase in the loss ratio.

The increase in the loss ratio was primarily driven by lower favorable net prior year loss reserve development.

Commercial’s combined ratio improved 3.0 points for the three months ended September 30, 2023 as compared with the comparable 2022 period due to a 2.6 point improvement in the loss ratio and a 0.4 point improvement in the expense ratio.

The improvement in the loss ratio was due to lower catastrophe losses, which were 7.4 points of the loss ratio for the three months ended September 30, 2023, as compared with 10.0 points of the loss ratio in the comparable 2022 period.

The improvement in the expense ratio was driven by higher net earned premiums, partially offset by higher employee related and acquisition costs.

International’s combined ratio improved 6.1 points for the three months ended September 30, 2023 as compared with the comparable 2022 period due to a 3.6 point improvement in the expense ratio and a 2.5 point improvement in the loss ratio.

The improvement in the expense ratio was driven by a 4.7 point favorable reinsurance acquisition related catch-up adjustment and higher net earned premiums partially offset by higher employee related costs.

The improvement in the loss ratio was driven by lower catastrophe losses, which were 2.3 points of the loss ratio for the three months ended September 30, 2023, as compared with 4.1 points of the loss ratio in the comparable 2022 period.

Nine Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Gross written premiums, excluding third-party captives, for Specialty decreased $20 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period driven by lower new business and rate.

Net written premiums for Specialty decreased $5 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

The increase in net earned premiums for the nine months ended September 30, 2023 was consistent with the trend in net written premiums in recent quarters for Specialty.

Gross written premiums for Commercial increased $680 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period driven by rate and higher new business.

Net written premiums for Commercial increased $491 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

The increase in net earned premiums for the nine months ended September 30, 2023 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International increased $92 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

Excluding the effect of foreign currency exchange rates, gross written premiums increased $111 million driven by favorable renewal premium change and retention.

Net written premiums for International increased $73 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

Excluding the effect of foreign currency exchange rates, net written premiums increased $83 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

The increase in n et earned premiums for the nine months ended September 30, 2023 was consistent with the trend in net written premiums for International.

Core income for Property & Casualty Operations increased $173 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period primarily due to higher net investment income and improved underlying underwriting income, partially offset by lower favorable net prior year loss reserve development and higher catastrophe losses.

Total catastrophe losses for Property & Casualty Operations were $214 million for the nine months ended September 30, 2023 as compared with $171 million for the comparable 2022 period.

For the nine months ended September 30, 2023 and 2022, Specialty had no catastrophe losses and catastrophe losses of $2 million, Commercial had catastrophe losses of $190 million and $148 million and International had catastrophe losses of $24 million and $21 million.

Favorable net prior year loss reserve development for Property & Casualty Operations of $11 million and $66 million was recorded for the nine months ended September 30, 2023 and 2022.

For the nine months ended September 30, 2023 and 2022, Specialty recorded favorable net prior year loss reserve development of $9 million and $35 million, Commercial recorded favorable net prior year loss reserve development of $17 million and $26 million and International recorded unfavorable net prior year loss reserve development of $15 million and favorable net prior year loss reserve development of $5 million.

Gross written premiums, excluding third-party captives, for Specialty decreased $6 million for the three months ended March 31, 2024 as compared with the comparable 2023 period driven by lower new business, partially offset by favorable rate.

Net written premiums for Specialty increased $4 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

The increase in net earned premiums for the three months ended March 31, 2024 was consistent with the trend in net written premiums for Specialty.

Gross written premiums for Commercial increased $244 million for the three months ended March 31, 2024 as compared with the comparable 2023 period driven by favorable renewal premium change and higher new business.

Net written premiums for Commercial increased $150 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

The increase in net earned premiums for the three months ended March 31, 2024 was consistent with the trend in net written premiums for Commercial.

Gross written premiums for International decreased $24 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

Excluding the effect of foreign currency exchange rates, gross written premiums decreased $31 million driven by lower new business.

Net written premiums for International decreased $11 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

Excluding the effect of foreign currency exchange rates, net written premiums decreased $16 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

The increase in n et earned premiums for the three months ended March 31, 2024 was consistent with the trend in net written premiums in recent quarters for International.

Core income for Property & Casualty Operations increased $26 million for the three months ended March 31, 2024 as compared with the comparable 2023 period driven by higher net investment income and favorable net prior year loss reserve development partially offset by higher catastrophe losses.

Catastrophe losses for Property & Casualty Operations were $88 million for the three months ended March 31, 2024 as compared with $52 million for the comparable 2023 period.

For the three months ended March 31, 2024 and 2023, Specialty had no catastrophe losses, Commercial had catastrophe losses of $82 million and $44 million and International had catastrophe losses of $6 million and $8 million.

Favorable net prior year loss reserve development for Property & Casualty Operations of $7 million was recorded for the three months ended March 31, 2024 as compared with unfavorable net prior year loss reserve development of $13 million for the three months ended March 31, 2023.

For the three months ended March 31, 2024 and 2023, Specialty recorded favorable net prior year loss reserve development of $5 million and no net prior year loss reserve development, Commercial recorded favorable net prior year loss reserve development of $2 million in each period and International recorded no net prior year loss reserve development and unfavorable net prior year loss reserve development of $15

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 1.8 points for the nine months ended September 30, 2023 as compared with the comparable 2022 period due to a 0.9 point increase in the expense ratio and a 0.9 point increase in the loss ratio.

The increase in the expense ratio was primarily driven by higher employee related costs.

The increase in the loss ratio was primarily driven by lower favorable net prior year loss reserve development.

Commercial’s combined ratio increased 0.5 points for the nine months ended September 30, 2023 as compared with the comparable 2022 period due to a 1.0 point increase in the loss ratio, partially offset by a 0.5 point improvement in the expense ratio.

The increase in the loss ratio was driven by higher catastrophe losses, which were 5.7 points of the loss ratio for the nine months ended September 30, 2023, as compared with 5.0 points of the loss ratio in the comparable 2022 period, and lower favorable net prior year loss reserve development.

The improvement in the expense ratio was driven by higher net earned premiums, partially offset by higher employee related costs.

International’s combined ratio improved 0.3 points for the nine months ended September 30, 2023 as compared with the comparable 2022 period due to a 1.8 point improvement in the expense ratio, partially offset by a 1.5 point increase in the loss ratio.

The improvement in the expense ratio was driven by a 1.3 point favorable reinsurance acquisition related catch-up adjustment and higher net earned premiums partially offset by higher employee related costs.

The increase in the loss ratio was driven by unfavorable net prior period loss reserve development of $15 million recorded for the nine months ended September 30, 2023 as compared with favorable net prior year loss reserve development of $5 million recorded in the comparable 2022 period.

Catastrophe losses were 2.7 points of the loss ratio for each of the nine months ended September 30, 2023 and 2022.

Specialty’s combined ratio increased 0.7 points for the three months ended March 31, 2024 as compared with the comparable 2023 period due to a 0.4 point increase in the expense ratio and a 0.2 point increase in the loss ratio.

The increase in the expense ratio was driven by higher acquisition costs.

The increase in the loss ratio was due to an increase in the underlying loss ratio partially offset by favorable net prior year loss reserve development.

Commercial’s combined ratio increased 1.6 points for the three months ended March 31, 2024 as compared with the comparable 2023 period primarily due to a 3.1 point increase in the loss ratio, partially offset by a 1.6 point improvement in the expense ratio.

The increase in the loss ratio was primarily driven by higher catastrophe losses, which were 6.8 points of the loss ratio for the three months ended March 31, 2024 as compared with 4.2 points of the loss ratio in the comparable 2023 period.

The improvement in the expense ratio was driven by higher net earned premiums and lower acquisition costs partially offset by higher employee related costs.

International’s combined ratio improved 3.9 points for the three months ended March 31, 2024 as compared with the comparable 2023 period due to a 5.3 point improvement in the loss ratio, partially offset by a 1.4 point increase in the expense ratio.

The improvement in the loss ratio for the three months ended March 31, 2024 was driven by unfavorable net prior year loss reserve development recorded for the comparable 2023 period.

Catastrophe losses were 2.0 points of the loss ratio for the three months ended March 31, 2024, as compared with 2.8 points of the loss ratio in the comparable 2023 period.

The increase in the expense ratio was driven by higher employee related costs partially offset by higher net earned premiums.

Other Insurance Operations

The following table summarizes the results of CNA’s Other Insurance Operations for the three and nine months ended September 30, 2023 and 2022.

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

The following table summarizes the results of CNA’s Other Insurance Operations for the three months ended March 31, 2024 and 2023.

Three Months Ended March 31 2024 2023

(In millions)

1 unchanged sentence

Net investment income 252 224

Core loss (a)

(62) (217) (149) (327)

(a) As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021.

Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance.

Core loss for Other Insurance Operations for the three and nine months ended September 30, 2022 was adjusted by $(170) million and $(203) million as a result of adopting the standard.

For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Core results for Other Insurance Operations improved $155 million for the three months ended September 30, 2023 as compared with the comparable 2022 period.

Both periods are inclusive of cash flow assumption updates as a result of the annual long-term care reserve reviews completed in the third quarter of each year.

Results for the prior year quarter have been adjusted to reflect the application of ASU 2018-12 and include an unfavorable impact from cash flow assumption updates in 2022.

The cash flow assumption updates for the three months ended September 30, 2023 resulted in an $8 million pretax increase in long term care reserves.

Adjusted to reflect the application of ASU 2018-12, the cash flow assumption updates for the three months ended September 30, 2022 resulted in a $186 million pretax increase to long term care reserves, primarily driven by the unfavorable impact of increased cost of care inflation offset by favorable premium rate assumptions.

The annual structured settlement reserve review resulted in a pretax reduction in claim reserves of $6 million and $5 million for the three months ended September 30, 2023 and 2022.

Core results for the three months ended September 30, 2023 also included higher net investment income as compared with the comparable 2022 period, partially offset by a $16 million charge for the three months ended September 30, 2023 related to unfavorable net prior year loss reserve development largely associated with legacy mass tort claims as compared with no charge for the comparable 2022 period.

Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Nine Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Core results for Other Insurance Operations improved $178 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period primarily due to the annual reserve reviews performed in the third quarter of each year partially offset by long term care policy buyouts.

Policy buyouts generally result in an unfavorable impact on core results, as the cash payments are linked to higher statutory reserve levels.

CNA expects to continue offering policy buyouts for the remainder of 2023 and into future years.

Core results for the nine months ended September 30, 2023 also included higher net investment income and lower unfavorable net period year loss reserve development associated with legacy mass tort claims as compared with the comparable 2022 period.

Further information on net prior year loss reserve development is included in Note 5 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Impact of Office Consolidation on Fourth Quarter 2023 Results

In the fourth quarter of 2023, CNA committed to consolidate some of its offices, which include its principal executive offices.

As a result of the consolidation, a pretax charge of approximately $24 million is anticipated to be recorded in the fourth quarter of 2023 in Other Insurance Operations.

Future Policy Benefit Reserves

Annually in the third quarter, an actuarial analysis is performed on policyholder morbidity, persistency, premium rate increases and expense experience.

This analysis, combined with judgment, informs the setting of updated cash flow assumptions used to estimate the liability for future policyholder benefits (“LFPB”).

Further information on the reserving process is included in Note 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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

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 management 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 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 any net premium ratio impacts.

September 30, 2023

Estimated Reduction to Pretax Income

(In millions)

Hypothetical revisions

2.5% increase in morbidity $ 275

5% increase in morbidity 600

5% decrease in active life mortality and lapse $ 150

10% decrease in active life mortality and lapse 300

Premium rate actions:

25% decrease in anticipated future premium rate increases $ 25

50% decrease in anticipated future premium rate increases 50

The following table summarizes policyholder reserves for CNA’s long term care operations:

September 30, 2023 Claim and claim adjustment expenses Future policy benefits Total

(In millions)

Long term care $ 12,654 $ 12,654

Structured settlement annuities and other $ 552 552

Total 552 12,654 13,206

Ceded reserves 97 97

Total gross reserves $ 649 $ 12,654 $ 13,303

December 31, 2022 Claim and claim adjustment expenses Future policy benefits Total

(In millions)

Long term care (a)(b) $ 13,480 $ 13,480

Structured settlement annuities and other $ 594 594

Total 594 13,480 14,074

Ceded reserves 101 101

Total gross reserves $ 695 $ 13,480 $ 14,175

(a) As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021.

Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance.

For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

(b) In conjunction with the adoption of ASU 2018-12, at January 1, 2023 the long term care reserves for policyholders currently receiving benefits were reclassified from Claim and claim adjustment expenses to Future policy benefits.

This change was applied retrospectively as of January 1, 2021.

As part of the annual reserve reviews, statutory long term care reserve adequacy is evaluated by premium deficiency testing, by comparing carried statutory reserves with best-estimate reserves, which incorporates best estimate discount rate and liability assumptions in its determination.

Statutory margin is the excess of carried reserves over best estimate reserves.

As of September 30, 2023, statutory long term care margin increased to $1.3 billion, primarily driven by a more favorable interest rate environment resulting in a higher yielding investment portfolio.

Core loss (17) (21)

Core results for Other Insurance Operations improved $4 million for the three months ended March 31, 2024 as compared with the comparable 2023 period, primarily due to higher net investment income, partially offset by a $5 million charge related to office consolidation in the 2024 period.

Non-GAAP Reconciliation of Net Income Attributable to Loews Corporation to Core Income

The following table reconciles net income attributable to Loews Corporation to core income for t he three and nine months ended September 30, 2023 and 2022:

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

The following table reconciles net income attributable to Loews Corporation to core income for t he three months ended March 31, 2024 and 2023:

Three Months Ended March 31 2024 2023

(In millions)

Net income (loss) attributable to Loews Corporation (a) $ 235 $ (37) $ 758 $ 398

Net income attributable to Loews Corporation $ 310 $ 268

Investment losses 17 28

Consolidation adjustments including

noncontrolling interests (a)

Noncontrolling interests 28 29

Total core income $ 355 $ 325

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Property & Casualty Operations 372 $ 346

Other Insurance Operations (a) (62) (217) (149) (327)

Other Insurance Operations (17) (21)

Total core income $ 355 $ 325

(a) As of January 1, 2023, ASU 2018-12 was adopted using the modified retrospective method applied as of the transition date of January 1, 2021.

Prior period amounts presented in the financial statements have been adjusted to reflect application of the new guidance.

Core loss for Other Insurance Operations for the three and nine months ended September 30, 2022 was adjusted by $(170) million and $(203) million as a result of adopting the standard.

For additional information see Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Boardwalk Pipelines

A significant portion of Boardwalk Pipelines’ revenues is fee-based, being derived from capacity reservation charges under firm agreements with customers, which do not vary significantly period to period, but are impacted by longer term trends in its business such as changes in pricing on contract renewals and other factors.

Boardwalk Pipelines’ operating costs and expenses do not vary significantly based upon the amount of products transported, with the exception of costs recorded in fuel and transportation expense, which are netted with fuel retained on our Consolidated Condensed Statements of Operations.

Boardwalk Pipelines has little to no direct commodity price exposure.

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, 2023.

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”) and Boardwalk Pipelines’ efforts to monitor, control and reduce emissions, 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, 2022.

The following table summarizes the results of operations for Boardwalk Pipelines for the three and nine months ended September 30, 2023 and 2022, as presented in Note 13 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 and Boardwalk Pipelines’ efforts to monitor, control and reduce emissions, 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, 2023.

On September 29, 2023, Boardwalk Pipelines acquired Williams Olefins Pipeline Holdco LLC, renamed Boardwalk Ethane Pipeline Holdco, LLC (“Bayou Ethane”), after the acquisition, from Williams Field Services Group, LLC.

Bayou Ethane provides ethane supply and transportation services for industrial customers in Louisiana and Texas.

The following table summarizes the results of operations for Boardwalk Pipelines for the three months ended March 31, 2024 and 2023, as presented in Note 12 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Boardwalk Pipelines also utilizes a non-GAAP measure, earnings before interest, income tax expense, depreciation and amortization (“EBITDA”) 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.

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

Three Months Ended March 31 2024 2023

(In millions)

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EBITDA $ 307 $ 256

Three Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation and EBITDA increased $15 million and $10 million for the three months ended September 30, 2023 as compared with the comparable 2022 period.

Total revenues increased $24 million for the three months ended September 30, 2023 as compared with the comparable 2022 period, due to higher operating revenues.

Including fuel and transportation expenses, operating revenues increased $16 million, primarily driven by an increase in transportation revenues of $14 million due to re-contracting at higher rates, higher natural gas liquids and other hydrocarbons (referred to together as “NGLs”) transportation revenues and recently completed growth projects, as well as a $7 million increase in storage, parking and lending revenues due to favorable market conditions.

Operating costs and expenses increased $8 million for the three months ended September 30, 2023 as compared with the comparable 2022 period.

Excluding expenses offset with operating revenues, operating costs and expenses increased $6 million, primarily due to increased costs from maintenance projects associated with the requirements of the Mega Rule and higher employee-related and outside services costs.

Interest expenses decreased $3 million for the three months ended September 30, 2023 as compared with the comparable 2022 period, primarily due to lower average outstanding long-term debt.

Nine Months Ended September 30, 2023 Compared to the Comparable 2022 Period

Net income attributable to Loews Corporation and EBITDA increased $27 million and $25 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

Total revenues increased $80 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

This increase was primarily due to operating revenues, which increased $69 million, primarily driven by an increase in transportation revenues of $60 million primarily due to re-contracting at higher rates and recently completed growth projects as well as a $20 million increase in storage, parking and lending revenues due to favorable market conditions, partially offset by lower product sales of $9 million.

In addition, interest income increased $11 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period.

Operating costs and expenses increased $44 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period, due to higher costs from increased maintenance projects associated with the requirements of the Mega Rule and higher employee-related, materials and supplies and outside services costs.

Depreciation and amortization expenses increased $9 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period due to an increased asset base from recently completed growth projects and a change in the estimated life of certain assets.

Interest expenses decreased $9 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period, primarily due to lower average outstanding long-term debt.

EBITDA and net income attributable to Loews Corporation increased $51 million and $35 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

Total revenues increased $120 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

Boardwalk Pipelines’ transportation revenues increased $24 million, primarily due to re-contracting at higher rates and recently completed growth projects;

storage, parking and lending revenues increased $7 million due to favorable market conditions;

product sale revenues from the sale of natural gas, ethylene and propane increased $9 million;

and the Bayou Ethane acquisition contributed $75 million of operating revenues, primarily resulting from ethane product sales.

Operating costs and expenses increased $65 million for the three months ended March 31, 2024 as compared with the comparable 2023 period primarily reflecting operations of the Bayou Ethane acquisition.

Depreciation and amortization expenses increased $5 million for the three months ended March 31, 2024 as compared with the comparable 2023 period due to an increased asset base from recently completed growth projects and the Bayou Ethane acquisition.

Interest expenses increased $4 million for the three months ended March 31, 2024 as compared with the comparable 2023 period, primarily due to higher average outstanding debt.

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

The following table reconciles net income attributable to Loews Corporation to EBITDA for the three and nine months ended September 30, 2023 and 2022:

Three Months Ended

Nine Months Ended

September 30,

2023 2022 2023 2022

The following table reconciles net income attributable to Loews Corporation to EBITDA for the three months ended March 31, 2024 and 2023:

Three Months Ended March 31 2024 2023

(In millions)

Net income attributable to Loews Corporation $ 121 $ 86

$ 49 $ 34 $ 191 $ 164

Interest, net

33 42 106 126

Income tax expense

Depreciation and amortization

103 103 306 297

$ 202 $ 192 $ 669 $ 644

Loews Hotels & Co

The following table summarizes the results of operations for Loews Hotels & Co for the three and nine months ended September 30, 2023 and 2022, as presented in Note 13 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,

2023 2022 2023 2022

The following table summarizes the results of operations for Loews Hotels & Co for the three months ended March 31, 2024 and 2023, as presented in Note 12 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Three Months Ended March 31 2024 2023

(In millions)

Operating revenue $ 183 $ 155

Gain on acquisition of a joint venture 46

Revenues related to reimbursable expenses 33 37

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Operating 155 130

Asset impairments 8 9 22

Reimbursable expenses 33 37

Depreciation and amortization expense 18 16 51 47

Depreciation and amortization 21 16

Equity income from joint ventures (27) (31)

Interest 3 (1) 9 7

Total 188 158

2 unchanged sentences

Net income attributable to Loews Corporation $ 16 $ 24

Net income attributable to Loews Corporation decreased $8 million and increased $31 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 periods primarily due to the reasons discussed below.

Operating revenues improved by $11 million and $57 million and operating expenses increased by $13 million and $54 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 periods.

The increase in operating revenues was driven by consolidating the results of a property previously accounted for under the equity method and a higher overall occupancy level at owned hotels.

The increase in operating expenses was largely due to consolidating the results of a property previously accounted for under the equity method in addition to increased staffing costs and higher property taxes.

The nine months ended September 30, 2023 includes a gain of $46 million ($36 million after tax) related to the acquisition of an additional equity interest in, and the consolidation of, a previously unconsolidated joint venture property .

Equity income from joint ventures decreased $10 million and $17 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 periods.

The overall occupancy level at joint venture properties was lower in 2023 compared to the comparable prior year periods.

Average daily rates increased nominally for the nine months ended September 30, 2023, but declined for the three months ended September 30, 2023, compared to the comparable prior year periods.

Expenses at joint venture properties have increased in 2023 compared to 2022, largely due to increased staffing costs, as well as higher property insurance, property taxes and interest costs.

The nine months ended September 30, 2023 includes impairment charges of $9 million and the three and nine months ended September 30, 2022 include impairment charges of $8 million and $22 million to reduce the carrying value of assets to their estimated fair value.

Interest expense increased $4 million and $2 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 perio ds due primarily to consolidating the results of a property in the three and nine months ended September 30, 2023 that was previously accounted for under the equity method, and lower favorable impact of interest rate caps, offset by the increase in capitalized interest on projects under development.

Net income attributable to Loews Corporation decreased $8 million for the three months ended March 31, 2024 as compared with the comparable 2023 period primarily due to the reasons discussed below.

Operating revenues improved by $28 million and operating expenses increased by $25 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

The increas e in operating revenues and operating expenses was driven by the opening of the Loews Arlington Hotel and Convention Center, including pre-opening expenses, in the first quarter of 2024 and consolidating the results of a property previously accounted for under the equity method.

Operating revenues also improved due to higher occupancy levels at city center hotels as a result of the continued recovery in group travel in 2024 as compared with the comparable 2023 period and an increase in food and beverage revenues.

Operating expenses also increased due to increased staffing costs, as well as higher insurance expenses and property taxes.

Equity income from joint ventures decreased $4 million for the three months ended March 31, 2024 as compared with the comparable 2023 period.

The decrease was driven by a reduction in overall occupancy levels at many joint venture hotels, particularly at the Universal Orlando Resort, during the first quarter of 2024 as compared with the comparable 2023 period and consolidating the results of a property previously accounted for under the equity method.

Expenses at joint venture properties increased in 2024 compared to 2023, largely due to increased staffing costs, as well as higher insurance expenses and property taxes.

Depreciation and amortization increased $5 million for the three months ended March 31, 2024 as compared with the comparable 2023 period mainly due to the opening of the Loews Arlington Hotel and Convention Center in the first quarter of 2024 and consolidating the results of a property previously accounted for under the equity method.

Interest expense for the three months ended March 31, 2024 was consistent with the comparable 2023 perio d as higher interest rates and average outstanding debt balances were offset by the favorable impact of interest rate caps and the increase in capitalized interest on projects under development.

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

1 unchanged sentence

Corporate also includes the equity method of accounting for Altium Packaging.

The following table summarizes the results of operations for Corporate for the three and nine months ended September 30, 2023 and 2022 as presented in Note 13 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,

2023 2022 2023 2022

The following table summarizes the results of operations for Corporate for the three months ended March 31, 2024 and 2023 as presented in Note 12 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report:

Three Months Ended March 31 2024 2023

(In millions)

Net investment income (loss) $ 31 $ (19) $ 84 $ (100)

Operating revenues and other 4 6

Total 31 (15) 84 (94)

Net investment income $ 54 $ 42

Operating and other 22 19

1 unchanged sentence

Interest 19 22

Total 91 40 175 129

Loss before income tax (60) (55) (91) (223)

Income tax benefit 12 11 15 44

Net loss attributable to Loews Corporation $ (48) $ (44) $ (76) $ (179)

Net investment income for the Parent Company was $31 million and $84 million for the three and nine months ended September 30, 2023 as compared with net investment losses of $19 million and $100 million in the comparable 2022 periods, primarily due to the favorable change in the fair value of equity based investments and improved results from short term investments and fixed maturity securities in the trading portfolio.

Operating and other expenses increased by $53 million and $47 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 periods.

These increases were primarily due to a settlement expense of $47 million in the third quarter of 2023 to recognize unrealized losses, which were included in AOCI, due to the termination of a non-contributory defined benefit plan.

For additional information see Note 10 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Interest expenses decreased by $5 million and $6 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 periods due to the retirement of the Parent Company’s $500 million aggregate principal amount of its 2.6% senior notes in May of 2023.

Income (loss) before income tax 12 (2)

Income tax expense (2) (1)

Net income (loss) attributable to Loews Corporation $ 10 $ (3)

Net income attributable to Loews Corporation increased $13 million for the three months ended March 31, 2024 as compared with the comparable 2023 period primarily due to the reasons discussed below.

Net investment income for the Parent Company increased $12 million for the three months ended March 31, 2024 as compared with the comparable 2023 period, primarily due to higher returns on equity investments.

Interest expenses decreased by $3 million for the three months ended March 31, 2024 as compared with the comparable 2023 period due to the retirement of the Parent Company’s $500 million aggregate principal amount of its 2.6% senior notes in May of 2023.

LIQUIDITY AND CAPITAL RESOURCES

Parent Company

Parent Company cash and investments, net of receivables and payables, totaled $2.3 billion at September 30, 2023 as compared to $3.2 billion at December 31, 2022.

During the nine months ended September 30, 2023 , we received $602 million in cash dividends from CNA, including a special cash dividend of $293 million.

Cash outflows during the nine months ended September 30, 2023 included the payment of $709 million to fund treasury stock purchases, $500 million to retire at maturity the outstanding aggregate principal amount of our 2.6% senior notes, $43 million of cash dividends to our shareholders, $178 million to purchase common shares of CNA and equity contributions of $38 million to Loews Hotels & Co .

Parent Company cash and investments, net of receivables and payables, totaled $3.2 billion at March 31, 2024 as compared to $2.6 billion at December 31, 2023.

During the three months ended March 31, 2024 , we received $656 million in cash dividends from our subsidiaries, including a special cash dividend of $497 million from CNA and a $50 million distribution from Boardwalk Pipelines.

Cash outflows during the three months ended March 31, 2024 included the payment of $24 million to fund treasury stock purchases and $14 million of cash dividends to our shareholders .

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

2 unchanged sentences

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

During the nine months ended September 30, 2023 , we purchased 11.9 million shares of Loews Corporation common stock and 4.5 million shares of CNA’s common stock.

As of October 27, 2023, there were 223,250,642 shares of Loews Corporation common stock outstanding.

We repurchased 0.9 million shares of Loews Corporation common stock for a total cost of $67 million since December 31, 2023 .

As of May 3, 2024, there were 221,406,259 shares of Loews Corporation common stock outstanding.

Future uses of our cash may include investing in our subsidiaries, new acquisitions, dividends and/or purchases 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 $1.8 billion for the nine months ended September 30, 2023 as compared with $2.0 billion for the comparable 2022 period.

The decrease in cash provided by operating activities was driven by higher net claim payments, which includes long term care policy buyouts of $160 million and lower distributions from limited partnerships, partially offset by an increase in premiums collected.

CNA paid cash dividends of $2.46 per share on its common stock, including a special cash dividend of $1.20 per share, during the nine months ended September 30, 2023.

On October 27, 2023, CNA’s Board of Directors declared a quarterly cash dividend of $0.42 per share payable November 30, 2023 to shareholders of record on November 13, 2023 .

CNA’s cash provided by operating activities was $504 million for the three months ended March 31, 2024 as compared with $436 million for the comparable 2023 period.

The increase in cash provided by operating activities was driven by an increase in premiums collected and higher distributions from limited partnerships, partially offset by an increase in net claim payments and higher operating expenses.

CNA paid cash dividends of $2.44 per share on its common stock, including a special cash dividend of $2.00 per share, during the three months ended March 31, 2024.

On May 2, 2024, CNA’s Board of Directors declared a quarterly cash dividend of $0.44 per share payable June 6, 2024 to shareholders of record on May 20, 2024 .

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.

1 unchanged sentence

Dividends to CNA from Continental Casualty Company (“CCC”), a subsidiary of CNA, are subject to the insurance holding company laws of the State of Illinois, the domiciliary state of CCC.

Under these laws, ordinary dividends, or dividends that do not require prior approval by the Illinois Department of Insurance (the “Department”), are determined based on the greater of the prior year’s statutory net income or 10% of statutory surplus as of the end of the prior year, as well as the timing and amount of dividends paid in the preceding 12 months.

Under these laws, ordinary dividends, or dividends that do not require prior approval by the Illinois Department of Insurance, are determined based on the greater of the prior year’s statutory net income or 10% of statutory surplus as of the end of the prior year, as well as the timing and amount of dividends paid in the preceding 12 months.

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

As of September 30, 2023, CCC was in a positive earned surplus position.

CCC paid dividends of $770 million and $845 million during the nine months ended September 30, 2023 and 2022.

As of March 31, 2024, CCC was in a positive earned surplus position.

CCC paid dividends of $300 million and $475 million during the three months ended March 31, 2024 and 2023.

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.

In May of 2023 , CNA completed a public offering of $400 million aggregate principal amount of its 5.5% senior notes due June 15, 2033 and in August of 2023, CNA completed a public offering of an additional $100 million aggregate principal amount of its 5.5% senior notes due June 15, 2033.

In February of 2024 , CNA completed a public offering of $500 million aggregate principal amount of its 5.1% senior notes due February 15, 2034 .

CNA intends to use the net proceeds towards retiring the outstanding $550 million aggregate principal amount of its 4.0% senior notes due May 2024.

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 $48 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period, primarily due to changes in net income adjusted for depreciation and amortization and other non-cash operating activities.

For the nine months ended September 30, 2023 and 2022, Boardwalk Pipelines’ capital expenditures were $232 million and $208 million, consisting of growth capital expenditures of $137 million and $122 million and maintenance capital expenditures of $95 million and $79 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, 2023, Boardwalk Pipelines purchased Williams Olefins Pipeline Holdco LLC (“Bayou Ethane”) for $348 million in cash.

For further information, see Note 2 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

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 2023.

During the third quarter of 2023, Boardwalk Pipelines filed a $1.5 billion shelf registration statement with the SEC, which was declared effective in September of 2023, under which it may publicly issue debt securities, warrants or rights from time to time.

As of September 30, 2023, Boardwalk Pipelines had available the entire $1.0 billion of borrowing capacity under its revolving credit facility.

In June of 2023, Boardwalk Pipelines’ amended its revolving credit facility to extend the maturity date by one year to May 26, 2028.

For further information, see Note 8 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

As of September 30, 2023, Loews Hotels & Co, through its subsidiaries, had $464 million in mortgage loans that mature within twelve months.

Loews Hotels & Co currently intends to exercise options to extend or refinance these loans prior to maturity.

Extending or refinancing 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.

Boardwalk Pipelines’ cash provided by operating activities increased $43 million for the three months ended March 31, 2024 as compared with the comparable 2023 period, primarily due to changes in net income adjusted for depreciation and amortization.

For the three months ended March 31, 2024 and 2023, Boardwalk Pipelines’ capital expenditures were $97 million and $86 million, consisting of growth capital expenditures of $59 million in each period and maintenance capital expenditures of $38 million and $27 million.

In February of 2024 , Boardwalk Pipelines completed a public offering of $600 million aggregate principal amount of its 5.6% senior notes due August 1, 2034 .

As of March 31, 2024, Boardwalk Pipelines had the full borrowing capacity of $1.0 billion available under its revolving credit facility.

The revolving credit facility has a borrowing capacity of $1.0 billion through May 27, 2027, and a borrowing capacity of $912 million from May 28, 2027 to May 26, 2028.

Boardwalk Pipelines anticipates that its existing capital resources, including its cash and cash equivalents, short-term investments, revolving credit facility and cash flows from operating activities, will be adequate to fund its operations and capital expenditures for 2024 and to retire its $600 million of debt that is maturing in December 2024.

As of March 31, 2024, Boardwalk Pipelines also has an effective shelf registration statement on file with the SEC under which it may publicly issue up to $900 million of debt securities, warrants or rights from time to time.

In February of 2024, Boardwalk Pipelines paid a distribution of $50 million to the Company.

As of March 31, 2024, Loews Hotels & Co, through its subsidiaries, had $527 million in mortgage loans that mature within twelve months.

Loews Hotels & Co currently intends to refinance these loans prior to maturity.

Refinancing 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, all Loews Hotels & Co’s subsidiaries are in compliance with their debt covenants.

Through October 27, 2023 , Loews Hotels & Co received capital contributions of $38 million from Loews Corporation to fund development projects during 2023.

Loews Hotels & Co received aggregate proceeds of $23 million for the sale of an owned hotel in the first quarter of 2024.

In addition, Loews Hotels & Co agreed to acquire all of the remaining outstanding noncontrolling equity interest of an owned and consolidated hotel for $30 million.

This transaction was completed on April 1, 2024.

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

12 unchanged sentences

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

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

Three Months Ended March 31 2024 2023

(In millions)

8 unchanged sentences

Limited partnership and common stock return 2.9 % 1.3 %

CNA’s net investment income increased $131 million and $351 million for the three and nine months ended September 30, 2023 as compared with the comparable 2022 periods, driven by higher limited partnership and common stock returns and higher income from fixed income securities and other.

CNA’s net investment income increased $84 million for the three months ended March 31, 2024 as compared with the comparable 2023 period, driven by favorable limited partnership and common stock returns and higher income from fixed income securities as a result of favorable reinvestment rates.

Investment Gains (Losses)

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

Three Months Ended Nine Months Ended

September 30, September 30,

2023 2022 2023 2022

Three Months Ended March 31 2024 2023

(In millions)

11 unchanged sentences

Investment losses attributable to Loews Corporation $ (16) $ (25)

CNA’s pretax investment losses decreased $58 million for the three months ended September 30, 2023 as compared with the comparable 2022 period, which reflects lower net losses on fixed maturity securities.

CNA’s pretax investment losses

decreased $61 million for the nine months ended September 30, 2023 as compared with the comparable 2022 period, driven by the favorable relative change in fair value of non-redeemable preferred stock.

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

The coinsurance agreement was novated in the fourth quarter of 2022.

CNA’s pretax investment losses decreased $13 million for the three months ended March 31, 2024 as compared with the comparable 2023 period, driven by the favorable change in fair value of non-redeemable preferred stock.

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.

1 unchanged sentence

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

September 30, 2023

March 31, 2024

December 31, 2023

11 unchanged sentences

Total $ 40,605 $ (2,253) $ 40,425 $ (1,973)

As of September 30, 2023 and December 31, 2022, 1% of CNA’s fixed maturity portfolio was rated internally.

AAA rated securities included $0.2 billion and $0.3 billion of pre-funded municipal bonds as of September 30, 2023 and December 31, 2022.

As of March 31, 2024 and December 31, 2023, 1% of CNA’s fixed maturity portfolio was rated internally.

AAA rated securities included $0.2 billion of pre-funded municipal bonds as of March 31, 2024 and December 31, 2023.

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

September 30, 2023

March 31, 2024

Estimated Fair Value

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AAA 1,661 280

AA 4,458 1,037

BBB 11,672 1,083

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

September 30, 2023

March 31, 2024

Estimated Fair Value

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Total $ 27,012 $ 3,096

Commercial Real Estate

CNA’s investment portfolio has exposure to the commercial real estate sector primarily through its fixed maturity securities and mortgage loan portfolios.

The performance of these assets is dependent on a number of factors, including the performance of the underlying collateral (which is influenced by cash flows from underlying property leases), changes in the fair value of collateral, refinancing risk, and the creditworthiness of tenants of credit tenant loan properties (where lease payments directly service the loan).

Within CNA’s fixed maturity securities portfolio, its exposure is primarily through the commercial mortgage-backed securities portfolio and the corporate and other bonds portfolio, which contains obligations of real estate investment trust (“REIT”) issuers.

Commercial mortgage-backed securities include both single asset, single borrower collateral that is securitized independently and conduit collateral that is securitized in diversified pools.

The following tables present the estimated fair value and net unrealized gains (losses) of CNA’s commercial mortgage-backed securities by property type and by ratings distribution:

September 30, 2023

Estimated Fair Value

Net Unrealized Gains (Losses)

(In millions)

Commercial mortgage-backed:

Single asset, single borrower:

Office $ 293 $ (83)

Retail 269 (37)

Lodging 216 (23)

Industrial 91 (6)

Multifamily 58 (4)

Total single asset, single borrower 927 (153)

Conduits (multi property, multi borrower pools) 627 (119)

Total commercial mortgage-backed $ 1,554 $ (272)

September 30, 2023

Estimated Fair Value

Net Unrealized Gains (Losses)

(In millions)

Commercial mortgage backed:

AAA $ 504 $ (39)

Non-investment grade 52 (24)

Total commercial mortgage-backed $ 1,554 $ (272)

The following tables present the estimated fair value and net unrealized gains (losses) of the REIT issuer exposure within CNA’s corporate and other bonds portfolio by property type and by ratings distribution:

September 30, 2023

Estimated Fair Value

Net Unrealized Gains (Losses)

(In millions)

Corporate and other bonds - REITs:

Retail $ 462 $ (53)

Office 237 (32)

Industrial 83 (8)

Other (a) 412 (41)

Total corporate and other bonds - REITs $ 1,194 $ (134)

(a) Other includes a diversified mix of property type strategies including self-storage, healthcare and apartments.

September 30, 2023

Estimated Fair Value

Net Unrealized Gains (Losses)

(In millions)

Corporate and other bonds - REITs:

AA $ 10 $ (1)

BBB 918 (112)

Non-investment grade 22 (3)

Total corporate and other bonds - REITs $ 1,194 $ (134)

Mortgage loans are commercial in nature and are carried at unpaid principal balance, net of unamortized fees and an allowance for expected credit losses.

The allowance for expected credit losses is developed by assessing the credit quality of pools of mortgage loans in good standing using debt service coverage ratios (“DSCR”) and loan-to-value ratios (“LTV”).

This assessment utilizes historical credit loss experience adjusted to reflect current conditions and reasonable and supportable forecasts.

As of September 30, 2023 the allowance for expected credit losses on CNA’s mortgage portfolio was $35 million, or 3.4% of its amortized cost basis.

The following table presents the amortized cost basis of mortgage loans by property type:

September 30, 2023

Amortized Cost Percentage of Total

(In millions, except %)

Mortgage loans:

Retail $ 470 45 %

Office 246 24

Industrial 133 13

Total mortgage loans 1,030 100 %

Allowance for expected credit losses (35)

Total mortgage loans - net of allowance $ 995

In addition to the mortgage loan portfolio, CNA invests in securitized credit tenant loans and ground lease financings that are classified as fixed maturity securities and are largely investment grade quality.

As of September 30, 2023 , these holdings had an estimated fair value of $437 million and net unrealized losses of $128 million.

CNA owns other fixed maturity securities which have exposure to cell towers, data centers and other collateral types that could be viewed as having real estate characteristics.

CNA views these securities to have risks more similar to operating enterprises that do not share the same risks as the broader commercial real estate market.

CNA does not hold any direct investments in commercial real estate.

Additionally, CNA does not have significant exposure through its limited partnership portfolio to funds whose primary strategy is real estate focused.

A primary objective in the management of CNA’s investment portfolio is to optimize return relative to the corresponding liabilities and respective liquidity needs.

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

September 30, 2023

March 31, 2024

December 31, 2023

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(In millions of dollars)

Investments supporting Other Insurance Operations $ 13,737 9.8 $ 14,511 9.9

Other investments 26,459 4.6 25,445 4.7

Life & Group $ 14,835 10.0 $ 15,137 10.2

Property & Casualty and other 28,123 4.5 27,981 4.5

Total $ 42,958 6.4 $ 43,118 6.5

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Accordingly, certain amounts currently recorded or disclosed in the financial statements will likely be adjusted in the future based on new available information and changes in other facts and circumstances.

See the Critical Accounting Estimates for accounting estimates related to Reinsurance and Insurance Receivables, Valuation of Investments and Impairment of Securities, and the Insurance Reserves sections of our MD&A in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022 for further information.

The information presented below restates in their entirety, as a result of the adoption of ASU 2018-12 and its impact on long term care reserves, the accounting estimates related to Insurance Reserves and Long Term Care Reserves included in the Critical Accounting Estimates section of our MD&A in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022 .

Further information on the long term care reserving process under the new guidance is included in Notes 1 and 6 of the Notes to Consolidated Condensed Financial Statements included under Item 1 of this Report.

Insurance Reserves

Insurance reserves are established for both short and long-duration insurance contracts.

Short-duration contracts are primarily related to property and casualty insurance policies where the reserving process is based on actuarial estimates of the amount of loss, including amounts for known and unknown claims.

Long-duration contracts are primarily related to long term care policies and the reserves are recorded as Future policy benefits reserves as discussed below.

The reserve for unearned premiums represents the portion of premiums written related to the unexpired terms of coverage.

The reserving process is discussed in further detail in the Insurance Reserves section of our MD&A in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022 .

Long Term Care Reserves

Future policy benefits reserves for long term care policies are based on certain assumptions, including morbidity, persistency (inclusive of mortality), future premium rate increases and expenses.

The adequacy of the reserves is contingent upon actual experience and future expectations related to these key assumptions.

If actual or expected future experience differs from these assumptions, the reserves may not be adequate, requiring an increase to reserves.

The reserves are discounted using upper-medium grade fixed income instrument yields as of each reporting date.

In addition, regulatory approval may not be received for the level of premium rate increases requested.

Changes to reserves could materially adversely impact our results of operations, financial condition and equity.

the Critical Accounting Estimates and the Insurance Reserves sections of our MD&A included under Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023 for further information.

ACCOUNTING STANDARDS UPDATE

In August 2018, the Financial Accounting Standards Board (“FASB”) issued ASU 2018-12.

The updated accounting guidance requires changes to the measurement and disclosure of long-duration contracts.

For the Company, this includes CNA’s long term care business in Other Insurance Operations.

Prior period amounts in the financial statements have been adjusted to reflect application of ASU 2018-12.

Net income attributable to Loews Corporation for the third quarter of 2022 decreased $152 million from what was previously reported under legacy accounting guidance, primarily related to CNA’s third quarter 2022 annual review of cash flow reserving assumptions.

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

Under the new guidance favorable changes to the upper-medium grade fixed income instrument discount rate were recorded through Accumulated other comprehensive income quarterly, while the net unfavorable impact of increased cost of care inflation offset by favorable premium rate action assumptions was recorded in income.

Excluding the third quarter of 2022, net income attributable to Loews Corporation did not change materially from what was reported prior to adoption of ASU 2018-12.

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

FORWARD-LOOKING STATEMENTS

Investors are cautioned that certain statements contained in this Report as well as in other of our and our subsidiaries’ SEC filings and periodic press releases and certain statements made by us and our subsidiaries and our and their officials during presentations may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”).

Investors are cautioned that certain statements contained in this Report as well as in other of our and our subsidiaries’ SEC filings and periodic press releases and certain statements made by us and our subsidiaries and our and their officials in presentations or remarks may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”).

Forward-looking statements include, without limitation, any statement that does not directly relate to any historical or current fact and may project, indicate or imply future results, events, performance or achievements.

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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