Cincinnati Global Adds Two New Lines of Business

Rhea-AI Summary

Cincinnati Financial Corporation (CINF) announced the launch of two new insurance lines: Contingency and Specie, through its global subsidiary, Cincinnati Global Underwriting Ltd.™. These lines aim to expand their specialty offerings in film production insurance and high-value property coverage. Francis Hernandez will lead the Contingency line, while Ian Seakens will take charge of Specie in early 2021. The company considers these sectors to be historically profitable and sees potential for significant growth in service to clients and brokers.

Positive

• Launch of two new specialty insurance lines: Contingency and Specie.
• Historically profitable sectors identified for potential growth.
• Experienced leadership joining the team to enhance underwriting capabilities.

Negative

• None.

CINCINNATI, Nov. 4, 2020 /PRNewswire/ -- Cincinnati Financial Corporation (Nasdaq: CINF) today announced that its London-based global specialty underwriting subsidiary, Cincinnati Global Underwriting Ltd.™, will begin writing two new lines of business: Contingency and Specie.

Contingency insurance covers film and entertainment risks, such as: insuring film and TV production for their props, sets, wardrobe and filming equipment; providing peace of mind that productions are completed within budget and delivered on time; and offering event cancellation for tradeshows, conferences, exhibitions, sporting events, theatrical performances, concerts and music festivals.

A Specie portfolio includes coverage for theft or loss of high-value portable property including fine art, jewelry, gold bullion and cash in transit.

Francis Hernandez joined Cincinnati Global as Head of Contingency on November 2. Hernandez began working in the insurance industry in 1988, specializing in Contingency since 1993. He has experience building profitable portfolios of entertainment business as an underwriter and a broker. Hernandez most recently headed Chubb's successful International Film & Entertainment Division.

Ian Seakens will also be joining Cincinnati Global as Head of Specie in early 2021. He brings with him 35 years of industry experience in Specie and Specialty Lines insurance. Seakens joins from AEGIS London where he worked for the last 10 years building an excellent reputation as a lead underwriter in the London market. Until Seakens joins the company, the Specie portfolio will be run by experienced underwriter Charlotte McIntyre, who also recently joined the Cincinnati Global team from AEGIS London.

Cincinnati Global Director of Corporate Development Kevin Timmons stated: "We are delighted that Frankie, Ian and Charlotte are joining our expanding team. We have identified Contingency and Specie as historically profitable classes of business through which we can grow and provide excellent service to clients and brokers. Following CGU's acquisition by Cincinnati Financial Corporation, we announced our intention to diversify our underwriting through the addition of new specialty classes of business. We believe Frankie and Ian's lead underwriting capability will enable us to meet these objectives and facilitate future profitable growth."

About Cincinnati Financial

Cincinnati Financial Corporation offers primarily business, home and auto insurance through The Cincinnati Insurance Company and its two standard market property casualty companies. The same local independent insurance agencies that market those policies may offer products of our other subsidiaries, including life insurance, fixed annuities and surplus lines property and casualty insurance. For additional information about the company, please visit cinfin.com.

Mailing Address:	Street Address:
P.O. Box 145496	6200 South Gilmore Road
Cincinnati, Ohio 45250-5496	Fairfield, Ohio 45014-5141

Safe Harbor

This is our "Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995. Our business is subject to certain risks and uncertainties that may cause actual results to differ materially from those suggested by the forward-looking statements in this report. Some of those risks and uncertainties are discussed in our 2019 Annual Report on Form 10-K, Item 1A, Risk Factors, Page 35 and Item 1A, Risk Factors in our subsequent Quarterly Reports on Form 10-Q.

Factors that could cause or contribute to such differences include, but are not limited to:

• Effects of the COVID-19 pandemic that could affect results for reasons such as: 
• Securities market disruption or volatility and related effects such as decreased economic activity that affect the company's investment portfolio and book value
• An unusually high level of claims in our insurance or reinsurance operations that increase litigation-related expenses
• An unusually high level of insurance losses, including risk of legislation or court decisions extending business interruption insurance in commercial property coverage forms to cover claims for pure economic loss related to the COVID-19 pandemic
• Decreased premium revenue and cash flow from disruption to our distribution channel of independent agents, consumer self-isolation, travel limitations, business restrictions and decreased economic activity
• Inability of our workforce, agencies or vendors to perform necessary business functions
• Unusually high levels of catastrophe losses due to risk concentrations, changes in weather patterns, environmental events, terrorism incidents or other causes
• Increased frequency and/or severity of claims or development of claims that are unforeseen at the time of policy issuance
• Inadequate estimates, assumptions or reliance on third-party data used for critical accounting estimates
• Declines in overall stock market values negatively affecting the company's equity portfolio and book value
• Prolonged low interest rate environment or other factors that limit the company's ability to generate growth in investment income or interest rate fluctuations that result in declining values of fixed-maturity investments, including declines in accounts in which we hold bank-owned life insurance contract assets
• Domestic and global events resulting in capital market or credit market uncertainty, followed by prolonged periods of economic instability or recession, that lead to:
• Significant or prolonged decline in the fair value of a particular security or group of securities and impairment of the asset(s)
• Significant decline in investment income due to reduced or eliminated dividend payouts from a particular security or group of securities
• Significant rise in losses from surety and director and officer policies written for financial institutions or other insured entities
• Our inability to integrate Cincinnati Global and its subsidiaries into our on-going operations, or disruptions to our on-going operations due to such integration
• Recession or other economic conditions resulting in lower demand for insurance products or increased payment delinquencies
• Difficulties with technology or data security breaches, including cyberattacks, that could negatively affect our ability to conduct business; disrupt our relationships with agents, policyholders and others; cause reputational damage, mitigation expenses and data loss and expose us to liability under federal and state laws
• Disruption of the insurance market caused by technology innovations such as driverless cars that could decrease consumer demand for insurance products
• Delays, inadequate data developed internally or from third parties, or performance inadequacies from ongoing development and implementation of underwriting and pricing methods, including telematics and other usage-based insurance methods, or technology projects and enhancements expected to increase our pricing accuracy, underwriting profit and competitiveness
• Increased competition that could result in a significant reduction in the company's premium volume
• Changing consumer insurance-buying habits and consolidation of independent insurance agencies that could alter our competitive advantages
• Inability to obtain adequate ceded reinsurance on acceptable terms, amount of reinsurance coverage purchased, financial strength of reinsurers and the potential for nonpayment or delay in payment by reinsurers
• Inability to defer policy acquisition costs for any business segment if pricing and loss trends would lead management to conclude that segment could not achieve sustainable profitability
• Inability of our subsidiaries to pay dividends consistent with current or past levels
• Events or conditions that could weaken or harm the company's relationships with its independent agencies and hamper opportunities to add new agencies, resulting in limitations on the company's opportunities for growth, such as:
• Downgrades of the company's financial strength ratings
• Concerns that doing business with the company is too difficult
• Perceptions that the company's level of service, particularly claims service, is no longer a distinguishing characteristic in the marketplace
• Inability or unwillingness to nimbly develop and introduce coverage product updates and innovations that our competitors offer and consumers expect to find in the marketplace
• Actions of insurance departments, state attorneys general or other regulatory agencies, including a change to a federal system of regulation from a state-based system, that:
• Impose new obligations on us that increase our expenses or change the assumptions underlying our critical accounting estimates
• Place the insurance industry under greater regulatory scrutiny or result in new statutes, rules and regulations
• Restrict our ability to exit or reduce writings of unprofitable coverages or lines of business
• Add assessments for guaranty funds, other insurance–related assessments or mandatory reinsurance arrangements; or that impair our ability to recover such assessments through future surcharges or other rate changes
• Increase our provision for federal income taxes due to changes in tax law
• Increase our other expenses
• Limit our ability to set fair, adequate and reasonable rates
• Place us at a disadvantage in the marketplace
• Restrict our ability to execute our business model, including the way we compensate agents
• Adverse outcomes from litigation or administrative proceedings
• Events or actions, including unauthorized intentional circumvention of controls, that reduce the company's future ability to maintain effective internal control over financial reporting under the Sarbanes-Oxley Act of 2002
• Unforeseen departure of certain executive officers or other key employees due to retirement, health or other causes that could interrupt progress toward important strategic goals or diminish the effectiveness of certain longstanding relationships with insurance agents and others
• Events, such as an epidemic, natural catastrophe or terrorism, that could hamper our ability to assemble our workforce at our headquarters location

Further, the company's insurance businesses are subject to the effects of changing social, global, economic and regulatory environments. Public and regulatory initiatives have included efforts to adversely influence and restrict premium rates, restrict the ability to cancel policies, impose underwriting standards and expand overall regulation. The company also is subject to public and regulatory initiatives that can affect the market value for its common stock, such as measures affecting corporate financial reporting and governance. The ultimate changes and eventual effects, if any, of these initiatives are uncertain.

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SOURCE Cincinnati Financial Corporation

FAQ

What new lines of business has CINF introduced?

CINF has introduced Contingency and Specie insurance lines.

Who will lead the new Contingency insurance line at Cincinnati Global?

Francis Hernandez will serve as the Head of Contingency.

When will Ian Seakens join Cincinnati Global?

Ian Seakens is set to join Cincinnati Global as Head of Specie in early 2021.

What does Contingency insurance cover?

Contingency insurance covers risks in film and entertainment, including event cancellation.

What is included in the Specie insurance portfolio?

The Specie portfolio includes coverage for theft or loss of high-value portable property like fine art and jewelry.