- Net Income Growth Full-year 2025 net income reached $2.4 billion (+4% YoY), with Q4 net income surging 67% to $676 million.
- Combined Ratio 2025 property-casualty combined ratio was 94.9%, up 1.5 points YoY due to a 1.6-point increase in catastrophe loss ratio.
- Investment Income Investment income rose 14% YoY ($9% QoQ), with bond interest income up 10% in Q4 and $1.6 billion in fixed maturity purchases for 2025.
- Business Growth Commercial lines new business grew 31% YoY in 2025, while personal lines increased 14%, driven by disciplined risk selection and agent relationships.
- Reinsurance Savings Favorable reinsurance development totaled $65 million for 2025 ($20 million Q4), with a 7% reduction in property CAT program rates despite expanded coverage.
Underwriting Performance
The full year 2025 property-casualty combined ratio was 1.5 percentage points higher than last year, driven by an increase of 1.6 points in the catastrophe loss ratio. The company's commercial lines business averaged mid-single-digit percentage rate increases, while personal lines saw rate increases in the low double-digit range for homeowners and high single-digit range for personal auto. As Stephen Michael Spray noted, "We've seen significant growth, particularly in commercial lines, with new business up 31% in 2025 over 2023 and personal lines up 14%."
Investment Income and Portfolio Performance
Investment income was a significant contributor to the company's higher net income, rising 9% for the fourth quarter and 14% for the full year 2025. The pretax average yield of 4.92% for the fixed maturity portfolio was similar to last year. Net purchases of fixed maturity securities totaled $1,600,000,000 for the full year 2025. The company's investment strategy is expected to drive solid growth in 2026 and beyond, with reinvestment yields running about 70 basis points above the book yield.
Valuation and Outlook
With a Price-to-Book Ratio (P/B) of 1.62, the company's valuation appears reasonable. The Dividend Yield is 2.13%, providing a relatively stable source of return. Analysts estimate next year's revenue growth at 7.2%. Given the company's strong underwriting performance, investment income growth, and reasonable valuation, Cincinnati Financial Corporation is well-positioned for future growth.