Michael Zaremski's questions to Cincinnati Financial Corp (CINF) leadership • Q2 2025
Question
Michael Zaremski of BMO Capital Markets inquired about the drivers of the lower-than-expected expense ratio and its future run rate. He also asked about the higher loss pick for workers' compensation, ongoing pressures in commercial auto, and the competitive dynamics in the property market, particularly for the SME segment versus the Lloyd's market.
Answer
EVP & CFO Michael Sewell attributed the improved expense ratio to premium growth outpacing expenses and stated the goal is to consistently stay below 30%. President & CEO Stephen Spray addressed commercial lines, citing a prudent approach for workers' comp and noting that social inflation is pressuring commercial auto, though recent accident years look good. He also contrasted the competitive large-property market with the stable rate environment in CINF's core small-to-middle market package business.